Palm Springs City Council
April 27, 2023

(Revised 09 13 18)

PUBLIC INTEGRITY DISCLOSURE

APPLICANT DISCLOSURE FORM

1. Name of Entity

2. Address of Entity (Principle Place of Business)

3. Local or California Address (if different than #2)

4. State where Entity is Registered with Secretary of State If other than California, is the Entity also registered in California?  Yes  No

5. Type of Entity
 Corporation  Limited Liability Company  Partnership  Trust  Other (please specify)

6. Officers, Directors, Members, Managers, Trustees, Other Fiduciaries (please specify) Note: If any response is not a natural person, please identify all officers, directors, members, managers and other fiduciaries for the member, manager, trust or other entity _________________________________________________  Officer  Director  Member  Manager [name]
 General Partner  Limited Partner
 Other ____________________________________
_________________________________________________  Officer  Director  Member  Manager [name]
 General Partner  Limited Partner
 Other ____________________________________
_________________________________________________  Officer  Director  Member  Manager [name]
 General Partner  Limited Partner
 Other ____________________________________
Item 1L - Page 10
CITY OF PALM SPRINGS – PUBLIC INTEGRITY DISCLOSURE FORM APPLICANT DISCLOSURE FORM

(Revised 09 13.18)

7. Owners/Investors with a 5% beneficial interest in the Applicant Entity or a related entity

EXAMPLE
JANE DOE
[name of owner/investor]
50%, ABC COMPANY, Inc.
[percentage of beneficial interest in entity
and name of entity]
A.
[name of owner/investor]   [percentage of beneficial interest in entity and name of entity]
B.
[name of owner/investor]    [percentage of beneficial interest in entity and name of entity]
C.
[name of owner/investor]    [percentage of beneficial interest in entity and name of entity]
D.
[name of owner/investor]    [percentage of beneficial interest in entity and name of entity]
E.
[name of owner/investor]   [percentage of beneficial interest in entity and name of entity]
I DECLARE UNDER PENALTY OF PERJURY UNDER THE LAWS OF THE STATE OF CALIFORNIA THAT THE FOREGOING IS TRUE AND CORRECT.

Signature of Disclosing Party, Printed Name, Title Date Item 1L - Page 11

CITY COUNCIL STAFF REPORT
04/27/2023
SUBJECT:

APPROVE CONTRACT SERVICES AGREEMENT NO. 23S081 WITH AIRBADGE,

LLC TO PROVIDE SOFTWARE SERVICES FOR AIRPORT BADGING FOR THE

PALM SPRINGS INTERNATIONAL AIRPORT
RECOMMENDATION:

Approve Contract Services Agreement No. 23S081 with AirBadge, LLC, to provide annual software services integrating with AAAE in an amount not to exceed $270,000 commencing on July 1, 2023 and ending on June 30, 2026.

1. 2. Authorize the City Manager or designee to execute all necessary documents.

Attachments
Item 1M

CITY COUNCIL STAFF REPORT
DATE: APRIL 27, 2023 CONSENT CALENDAR
SUBJECT: APPROVE CONTRACT SERVICES AGREEMENT NO. 23S081 WITH

AIRBADGE, LLC TO PROVIDE SOFTWARE SERVICES FOR AIRPORT

BADGING FOR THE PALM SPRINGS INTERNATIONAL AIRPORT
FROM: Scott C. Stiles, City Manager
BY: Department of Aviation
SUMMARY:

This action will approve a three-year contract services agreement with AirBadge, LLC to provide software services for implementing the American Association of Airport Executives (AAAE) badging and training program for the Palm Springs International Airport.

RECOMMENDATION:

1. Approve Contract Services Agreement No. 23S081 (Attachment A) with AirBadge, LLC to provide annual software services integrating with AAAE in an amount not to exceed $270,000 commencing on July 1, 2023 and ending on June 30, 2026.

2. Authorize the City Manager or designee to execute all necessary documents.

BUSINESS PRINCIPAL DISCLOSURE:

According to the Public Integrity Disclosure Form (Attachment B) submitted on March 14, 2023, AirBadge, LLC is registered in the State of California.

BACKGROUND:

Individuals seeking employment with airlines, concessionaires, service providers and contractors working at the Palm Springs International Airport (Airport) must undergo a federally mandated background clearance and complete Airport specific training in order to obtain badges giving them access to secured areas of the Airport campus. Telos Identity Management Solutions, LLC (Telos) has been providing the Airport with background clearance services such as fingerprinting and vetting that are approved by Item 1M - Page 1
City Council Staff Report
April 27, 2023 – Page 2
AirBadge, LLC Contract Services Agreement No. 23S081
the Transportation Security Administration (TSA), and AAAE has been providing the Airport with Interactive Employee Training (IET). The Airport intends on using AAAE for both the background clearance services and IET.

The current Airport badging process requires applicants to contact the Airport badging office to schedule an appointment. At the appointment the individuals must provide a completed paper badge application and complete their fingerprinting, background check and video training. The badge scheduling process is lengthy and inefficient. The Airport badging process can be improved by implementing a more efficient and digital system, reducing the number of steps involved, and streamlining the scheduling and completion of required steps.

STAFF ANALYSIS
AirBadge, LLC is the only Software as a Service (SaaS) provider that is integrated with the federally mandated vetting and training platforms provided by AAAE. AirBadge, LLC provides the software for the required training services to new applicants and badge holders, provides an identity management system to manage the badge holder TSA mandated audits, and allows for Airport employees to schedule appointments with the Airport badging office via an online booking system. As a result of this unique integration factor, staff has determined that this procurement qualifies as a sole source procurement under Section 7.05.020 of the City of Palm Springs Municipal Code.

The AirBadge, LLC subscription SaaS includes support, hosting, maintenance and updates to SaaS which integrates the federally mandated vetting services and training platforms.

Costs for the annual subscription fee and base licenses, which include 500 additional blocks of licenses, are outlined in Table 1 below:

Software and Support
Services
Year One Year
Two
Year Three Three-year
Agreement
Annual Subscription Fee $72,000 $72,000 $72,000 $216,000 Base Licenses w/500
Additional Blocks of Licenses
$18,000 $18,000 $18,000 $54,000
Total Not To Exceed $90,000 $90,000 $90,000 $270,000
Table 1 – Software and Support Services
ALIGNMENT WITH STRATEGIC PLANNING:

The requested action aligns with the City Council Priority 3A, Community Infrastructure.

Item 1M - Page 2
City Council Staff Report
April 27, 2023 – Page 3
AirBadge, LLC Contract Services Agreement No. 23S081
FISCAL IMPACT:

Funding in the amount of $90,000 will be budgeted in Account 4157055.40105 in Fiscal Year 2023-24. The remaining $180,000 will be budgeted in future fiscal years.

REVIEWED BY:

Department Director: Harry Barrett Jr.

Procurement and Contracting Manager: Kim Baker
City Attorney: Geremy Holm
City Manager: Scott Stiles
ATTACHMENTS:

A. Contract Service Agreement No. 23S081
B. Public Integrity Business Disclosure
Item 1M - Page 3

ATTACHMENT A
AGREEMENT NO. 23S081

WITH AIRBADGE, LLC
Item 1M - Page 4
CONTRACT SERVICES AGREEMENT NO. 23S081

AIRBADGE, LLC
THIS AGREEMENT NO. 23S081 FOR CONTRACT SERVICES (“Agreement”) is made and entered into on _________, by and between the City of Palm Springs, a California charter city and municipal corporation (“City”), and Airbadge, a California Limited Liability Company, (“Contractor”). City and Contractor are individually referred to as “Party” and are collectively referred to as the “Parties”.

RECITALS
A. City requires the services of a contractor, to implement a badge management system for the Palm Springs International Airport, (“Project”).

B. Contractor has submitted to City a proposal to provide Badge Management Software, for the customization of platform setting integration of America Association of Airport Executives (AAAE) Transportation Security Clearance (TSC), AAAE Interactive Employee Training (IET), the Airport’s Security Access Control System (SACS), data import & technical support to City under the terms of this Agreement.

C. Based on its experience, education, training, and reputation, Contractor is qualified and desires to provide the necessary services to City for the Project.

D. City desires to retain the services of Contractor for the Project.

NOW, THEREFORE, in consideration of the promises and mutual obligations, covenants, and conditions contained herein, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

AGREEMENT

1. CONTRACTOR SERVICES

1.1 Scope of Services. In compliance with all terms and conditions of this Agreement, Contractor shall provide services to City as described in the Order Form & Services Agreement attached to this Agreement as Exhibit “A” and incorporated herein by reference (the “Services” or “Work”). Exhibit "A" includes the agreed upon schedule of performance and the schedule of fees. Contractor warrants that the Services shall be performed in a competent, professional, and satisfactory manner consistent with the level of care and skill ordinarily exercised by high quality, experienced, and well qualified members of the profession currently practicing under similar conditions. In the event of any inconsistency between the terms contained in Exhibit “A” and the terms set forth in this Agreement, the terms set forth in this Agreement shall govern.

1.2 Compliance with Law. Contractor shall comply with all applicable federal, state, and local laws, statutes and ordinances and all lawful orders, rules, and regulations when Item 1M - Page 5
performing the Services. Contractor shall be liable for all violations of such laws and regulations in connection with the Services and this Agreement.

1.3 Licenses and Permits. Contractor shall obtain at its sole cost and expense such licenses, permits, and approvals as may be required by law for the performance of the Services required by this Agreement.

1.4 Familiarity with Work. By executing this Agreement, Contractor warrants that it has carefully considered how the Work should be performed and fully understands the facilities, difficulties, and restrictions attending performance of the Work under this Agreement.

2. TIME FOR COMPLETION
The time for completion of the Services to be performed by Contractor is an essential condition of this Agreement. Contractor shall prosecute regularly and diligently the work of this Agreement according to the agreed upon schedule of performance set forth in Exhibit “A.” Neither Party shall be accountable for delays in performance caused by any condition beyond the reasonable control and without the fault or negligence of the non-performing Party. Delays shall not entitle Contractor to any additional compensation regardless of the Party responsible for the delay.

3. COMPENSATION OF CONTRACTOR

3.1 Compensation of Contractor. Contractor shall be compensated and reimbursed for the services rendered under this Agreement in accordance with the schedule of fees set forth in Exhibit “A”. The total amount of Compensation shall not exceed $270,000.

3.2 Method of Payment. In any month in which Contractor wishes to receive payment, Contractor shall submit to City an invoice for Services rendered prior to the date of the invoice, no later than the first working day of such month, in the form approved by City’s finance director. Payments shall be based on the hourly rates set forth in Exhibit “A” for authorized services performed. City shall pay Contractor for all expenses stated in the invoice that are approved by City and consistent with this Agreement, within thirty (30) days of receipt of Contractor’s invoice.

3.3 Changes. In the event any change or changes in the Services is requested by City, Parties shall execute a written amendment to this Agreement, specifying all proposed amendments, including, but not limited to, any additional fees. An amendment may be entered into:

A. To provide for revisions or modifications to documents, work product, or Work, when required by the enactment or revision of any subsequent law; or B. To provide for additional services not included in this Agreement or not customarily furnished in accordance with generally accepted practice in Contractor’s profession.

Item 1M - Page 6

3.4 Appropriations. This Agreement is subject to, and contingent upon, funds being appropriated by the City Council of City for each fiscal year. If such appropriations are not made, this Agreement shall automatically terminate without penalty to City.

4. PERFORMANCE SCHEDULE

4.1 Time of Essence. Time is of the essence in the performance of this Agreement.

4.2 Schedule of Performance. All Services rendered under this Agreement shall be performed under the agreed upon schedule of performance set forth in Exhibit “A.” Any time period extension must be approved in writing by the Contract Officer.

4.3 Force Majeure. The time for performance of Services to be rendered under this Agreement may be extended because of any delays due to a Force Majeure Event, if Contractor notifies the Contract Officer within ten (10) days of the commencement of the Force Majeure Event. A Force Majeure Event shall mean an event that materially affects the Contractor’s performance and is one or more of the following: (1) Acts of God or other natural disasters occurring at the project site; (2) terrorism or other acts of a public enemy; (3) orders of governmental authorities (including, without limitation, unreasonable and unforeseeable delay in the issuance of permits or approvals by governmental authorities that are required for the Work); and (4) pandemics, epidemics or quarantine restrictions. For purposes of this section, “orders of governmental authorities,” includes ordinances, emergency proclamations and orders, rules to protect the public health, welfare and safety, and other actions of the City in its capacity as a municipal authority. After Contractor notification, the Contract Officer shall investigate the facts and the extent of any necessary delay and extend the time for performing the Services for the period of the enforced delay when and if, in the Contract Officer’s judgment, such delay is justified. The Contract Officer’s determination shall be final and conclusive upon the Parties to this Agreement. The Contractor will not receive an adjustment to the contract price or any other compensation. Notwithstanding the foregoing, the City may still terminate this Agreement in accordance with the termination provisions of this Agreement.

4.4 Term. Unless earlier terminated in accordance with Section 4.5 of this Agreement, this Agreement shall continue in full force and effect for a period of three years, commencing on issuance of Notice to Proceed, (“Initial Term”) unless extended by mutual written agreement of the Parties. Unless written notice of non-renewal is received by Contractor at least sixty (60) days, but not less than thirty (30) days, prior to the end of the Initial Term, this Agreement shall renew for one additional one-year period (“Renewal Term”). However, under no circumstances, shall this Agreement be renewed for more than two additional terms of one year.

4.5 Termination Prior to Expiration of Term. City may terminate this Agreement at any time, with or without cause, upon thirty (30) days written notice to Contractor. Where termination is due to the fault of Contractor and constitutes an immediate danger to health, safety, and general welfare, the period of notice shall be such shorter time as may be determined by the City. Upon receipt of the notice of termination, Contractor shall immediately cease all Services except such as may be specifically approved by the Contract Officer. Contractor shall be entitled to retain all compensation Contractor has received up to and including the date of Item 1M - Page 7
notice of termination, and shall be entitled to compensation for all Services rendered prior to receipt of the notice of termination and for any Services authorized by the Contract Officer after such notice. City shall not be liable for any costs other than the charges or portions thereof which are specified herein. Contractor shall not be entitled to damages or compensation for termination of Work. If the termination is for cause, the City shall have the right to take whatever steps it deems necessary to correct Contractor's deficiencies and charge the cost thereof to Contractor, who shall be liable for the full cost of the City's corrective action. Contractor may not terminate this Agreement except for cause, upon thirty (30) days written notice to City.

5. COORDINATION OF WORK

5.1 Representative of Contractor. The following principal of Contractor is designated as being the principal and representative of Contractor authorized to act and make all decisions in its behalf with respect to the specified Services: Nathan Smallcomb, Co-Founder. It is expressly understood that the experience, knowledge, education, capability, and reputation of the foregoing principal is a substantial inducement for City to enter into this Agreement.

Therefore, the foregoing principal shall be responsible during the term of this Agreement for directing all activities of Contractor and devoting sufficient time to personally supervise the Services under this Agreement. The foregoing principal may not be changed by Contractor without prior written approval of the Contract Officer.

5.2 Contract Officer. The Contract Officer shall be the City Manager or his/her designee ("Contract Officer"). Contractor shall be responsible for keeping the Contract Officer fully informed of the progress of the performance of the Services. Contractor shall refer any decisions that must be made by City to the Contract Officer. Unless otherwise specified, any approval of City shall mean the approval of the Contract Officer.

5.3 Prohibition Against Subcontracting or Assignment. The experience, knowledge, education, capability, and reputation of Contractor, its principals and employees, were a substantial inducement for City to enter into this Agreement. Contractor shall not contract with any other individual or entity to perform any Services required under this Agreement without the City's express written approval. In addition, neither this Agreement nor any interest may be assigned or transferred, voluntarily or by operation of law, without the prior written approval of City. Consent for assignment is not required in connection with an assignment to a corporate affiliate, or in connection with an assignment to an affiliate, or in connection with any merger, reorganization, consolidation, sale of assets, or a similar transaction. Subcontracts, if any, shall contain a provision making them subject to all provisions stipulated in this Agreement including without limitation the insurance and indemnification requirements. If Contractor is permitted to subcontract any part of this Agreement by City, Contractor shall be responsible to City for the acts and omissions of its subcontractor(s) in the same manner as it is for persons directly employed. For avoidance of doubt, a third party technology provider that provides features or functionality in connection with the Services shall not be deemed a sublicensee under this section. Nothing contained in this Agreement shall create any contractual relationships between any subcontractor and City.

5.4 Independent Contractor. Neither City nor any of its employees shall have any control over the manner, mode, or means by which Contractor, its agents or employees, perform Item 1M - Page 8
the Services required, except as otherwise specified. Contractor shall perform all required Services as an independent contractor of City and shall not be an employee of City and shall remain at all times as to City a wholly independent contractor with only such obligations as are consistent with that role; however, City shall have the right to review Contractor’s work product, result, and advice. Contractor shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of City. Contractor shall pay all wages, salaries, and other amounts due personnel in connection with their performance under this Agreement and as required by law. Contractor shall be responsible for all reports and obligations respecting such personnel, including, but not limited to: social security taxes, income tax withholding, unemployment insurance, and workers’ compensation insurance. Contractor shall not have any authority to bind City in any manner.

5.5 Personnel. Contractor agrees to assign the following individuals to perform the services in this Agreement. Contractor shall not alter the assignment of the following personnel without the prior written approval of the Contract Officer. Acting through the City Manager, the City shall have the unrestricted right to order the removal of any personnel assigned by Contractor by providing written notice to Contractor.

Name: Title:

Nathan Smallcomb Co-Founder
Dylan Smallcomb Co-Founder

5.6 California Labor Code Requirements.

A. Contractor is aware of the requirements of California Labor Code Sections 1720 et seq. and 1770 et seq., which require the payment of prevailing wage rates and the performance of other requirements on certain “public works” and “maintenance” projects (“Prevailing Wage Laws”). If the Services are being performed as part of an applicable “public works” or “maintenance” project, as defined by the Prevailing Wage Laws, and if the total compensation is $15,000 or more for maintenance or $25,000 or more for construction, alteration, demolition, installation, or repair, Contractor agrees to fully comply with such Prevailing Wage Laws. Contractor shall defend, indemnify and hold the City, its officials, officers, employees and agents free and harmless from any claims, liabilities, costs, penalties or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws. It shall be mandatory upon the Contractor and all subcontractors to comply with all California Labor Code provisions, which include but are not limited to prevailing wages (Labor Code Sections 1771, 1774 and 1775), employment of apprentices (Labor Code Section 1777.5), certified payroll records (Labor Code Sections 1771.4 and 1776), hours of labor (Labor Code Sections 1813 and 1815) and debarment of contractors and subcontractors (Labor Code Section 1777.1).

B. If the Services are being performed as part of an applicable “public works” or “maintenance” project and if the total compensation is $15,000 or more for maintenance or $25,000 or more for construction, alteration, demolition, installation, or repair, then pursuant to Labor Code Sections 1725.5 and 1771.1, the Contractor and all subcontractors performing such Item 1M - Page 9
Services must be registered with the Department of Industrial Relations. Contractor shall maintain registration for the duration of the Project and require the same of any subcontractors, as applicable. This Agreement may also be subject to compliance monitoring and enforcement by the Department of Industrial Relations. It shall be Contractor’s sole responsibility to comply with all applicable registration and labor compliance requirements.

6. INSURANCE
Contractor shall procure and maintain, at its sole cost and expense, policies of insurance as set forth in the attached Exhibit "B", incorporated herein by reference.

7. INDEMNIFICATION.

7.1 Indemnification. To the fullest extent permitted by law, Contractor shall defend (at Contractor’s sole cost and expense), indemnify, protect, and hold harmless City, its elected officials, officers, employees, agents, and volunteers (collectively the “Indemnified Parties”), from and against any and all liabilities, actions, suits, claims, demands, losses, costs, judgments, arbitration awards, settlements, damages, demands, orders, penalties, and expenses including legal costs and attorney fees (collectively “Claims”), including but not limited to Claims arising from injuries to or death of persons (Contractor’s employees included), for damage to property, including property owned by City, for any violation of any federal, state, or local law or ordinance or in any manner arising out of, pertaining to, or incident to any errors or omissions, or willful misconduct committed by Contractor, its officers, employees, representatives, and agents, that arise out of or relate to Contractor’s performance of Services or this Agreement. This indemnification clause excludes Claims arising from the sole negligence or willful misconduct of the Indemnified Parties. Under no circumstances shall the insurance requirements and limits set forth in this Agreement be construed to limit Contractor’s indemnification obligation or other liability under this Agreement. Contractor’s indemnification obligation shall survive the expiration or earlier termination of this Agreement until all actions against the Indemnified Parties for such matters indemnified are fully and finally barred by the applicable statute of limitations or, if an action is timely filed, until such action is final.

7.2 Design Professional Services Indemnification and Reimbursement. If Contractor’s obligation to defend, indemnify, and/or hold harmless arises out of Contractor’s performance as a “design professional” (as that term is defined under Civil Code section 2782.8), then, and only to the extent required by Civil Code section 2782.8, which is fully incorporated herein, Contractor’s indemnification obligation shall be limited to the extent which the Claims arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Contractor in the performance of the Services or this Agreement, and, upon Contractor obtaining a final adjudication by a court of competent jurisdiction, Contractor’s liability for such claim, including the cost to defend, shall not exceed the Contractor’s proportionate percentage of fault.

7.3 Intellectual Property Indemnification. Contractor will defend City against any claim, suit, demand, or action made or brought against City by a third party alleging that the Services, or City’s use or access thereof in accordance with this Agreement, infringes any intellectual property rights of such third party, and will indemnify and hold City harmless from any damages, losses, liabilities, costs, and fees (including reasonable attorney’s fees) finally Item 1M - Page 10
awarded against City in connection with or in settlement of any such claim, suit, demand, or action. The foregoing obligations do not apply with respect to portions or components of any Platform (as “Platform” is defined in Exhibit “A”) or Service (i) not supplied by Contractor, (ii) made in whole or in part in accordance with City specifications, (iii) that are modified after delivery, or granting of access, by Contractor, (iv) combined with other products, processes, or materials where the alleged infringement relates to such combination, (v) where City continues allegedly infringing activity after being notified thereof or after being informed of modifications that would have avoided the alleged infringement, or (vi) where City’s use of the Services is not strictly in accordance with this Agreement. If, due to a claim of infringement, a Platform is held by a court of competent jurisdiction to be, or is believed by Contractor to be infringing, Contractor may, at its option and expense (a) replace or modify such Platform to be noninfringing provided that such modification or replacement contains substantially similar features and functionality, (b) obtain for City a license to continue using such Platform, or (c) if neither of the foregoing is commercially practicable, terminate this Agreement and City’s rights hereunder and provide City a full refund of any prepaid, unused fees for such Platform. This Section states City’s sole and exclusive remedies for claims of infringement.

8. RECORDS AND REPORTS

8.1 Reports. Contractor shall periodically prepare and submit to the Contract Officer reports concerning the performance of the Services required by this Agreement, or as the Contract Officer shall require.

8.2 Records. Contractor shall keep complete, accurate, and detailed accounts of all time, costs, expenses, and expenditures pertaining in any way to this Agreement. Contractor shall keep such books and records as shall be necessary to properly perform the Services required by this Agreement and enable the Contract Officer to evaluate the performance of such Services. The Contract Officer shall have full and free access to such books and records at all reasonable times, including the right to inspect, copy, audit, and make records and transcripts from such records.

8.3 Ownership of Documents. All drawings, specifications, reports, records, documents, and other materials prepared by Contractor in the performance of this Agreement shall be the property of City. Contractor shall deliver all above-referenced documents to City upon request of the Contract Officer or upon the termination of this Agreement. Contractor shall have no claim for further employment or additional compensation as a result of the exercise by City of its full rights or ownership of the documents and materials. Contractor may retain copies of such documents for Contractor's own use. Contractor shall have an unrestricted right to use the concepts embodied in such documents.

8.4 Release of Documents. All drawings, specifications, reports, records, documents, and other materials prepared by Contractor in the performance of Services under this Agreement shall not be released publicly without the prior written approval of the Contract Officer.

8.5 Audit and Inspection of Records. After receipt of reasonable notice and during the regular business hours of City, Contractor shall provide City, or other agents of City, such Item 1M - Page 11
access to Contractor’s books, records, payroll documents, and facilities as City deems necessary to examine, copy, audit, and inspect all accounting books, records, work data, documents, and activities directly related to Contractor’s performance under this Agreement. Contractor shall maintain such books, records, data, and documents in accordance with generally accepted accounting principles and shall clearly identify and make such items readily accessible to such parties during the term of this Agreement and for a period of three (3) years from the date of final payment by City hereunder.

9. ENFORCEMENT OF AGREEMENT

9.1 California Law. This Agreement shall be construed and interpreted both as to validity and to performance of the parties in accordance with the laws of the State of California.

Legal actions concerning any dispute, claim, or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Riverside, State of California, or any other appropriate court in such county, and Contractor covenants and agrees to submit to the personal jurisdiction of such court in the event of such action.

9.2 Interpretation. This Agreement shall be construed as a whole according to its fair language and common meaning to achieve the objectives and purposes of the Parties. The terms of this Agreement are contractual and the result of negotiation between the Parties.

Accordingly, any rule of construction of contracts (including, without limitation, California Civil Code Section 1654) that ambiguities are to be construed against the drafting party, shall not be employed in the interpretation of this Agreement. The caption headings of the various sections and paragraphs of this Agreement are for convenience and identification purposes only and shall not be deemed to limit, expand, or define the contents of the respective sections or paragraphs.

9.3 Waiver. No delay or omission in the exercise of any right or remedy of a nondefaulting Party on any default shall impair such right or remedy or be construed as a waiver.

No consent or approval of City shall be deemed to waive or render unnecessary City’s consent to or approval of any subsequent act of Contractor. Any waiver by either Party of any default must be in writing. No such waiver shall be a waiver of any other default concerning the same or any other provision of this Agreement.

9.4 Rights and Remedies are Cumulative. Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the parties are cumulative. The exercise by either Party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party.

9.5 Legal Action. In addition to any other rights or remedies, either Party may take legal action, in law or in equity, to cure, correct, or remedy any default, to recover damages for any default, to compel specific performance of this Agreement, to obtain injunctive relief, a declaratory judgment, or any other remedy consistent with the purposes of this Agreement.

9.6 Attorney Fees. In the event any dispute between the Parties with respect to this Agreement results in litigation or any non-judicial proceeding, the prevailing Party shall be entitled, in addition to such other relief as may be granted, to recover from the non-prevailing Item 1M - Page 12
Party all reasonable costs and expenses. These include but are not limited to reasonable attorney fees, expert contractor fees, court costs and all fees, costs, and expenses incurred in any appeal or in collection of any judgment entered in such proceeding.

10. CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION

10.1 Non-Liability of City Officers and Employees. No officer or employee of City shall be personally liable to the Contractor, or any successor-in-interest, in the event of any default or breach by City or for any amount which may become due to the Contractor or its successor, or for breach of any obligation of the terms of this Agreement.

10.2 Conflict of Interest. Contractor acknowledges that no officer or employee of the City has or shall have any direct or indirect financial interest in this Agreement, nor shall Contractor enter into any agreement of any kind with any such officer or employee during the term of this Agreement and for one (1) year thereafter. Contractor warrants that Contractor has not paid or given, and will not pay or give, any third party any money or other consideration in exchange for obtaining this Agreement.

10.3 Covenant Against Discrimination. In connection with its performance under this Agreement, Contractor shall not discriminate against any employee or applicant for employment because of actual or perceived race, religion, color, sex, age, marital status, ancestry, national origin (i.e., place of origin, immigration status, cultural or linguistic characteristics, or ethnicity), sexual orientation, gender identity, gender expression, physical or mental disability, or medical condition (each a “prohibited basis”). Contractor shall ensure that applicants are employed, and that employees are treated during their employment, without regard to any prohibited basis. As a condition precedent to City’s lawful capacity to enter this Agreement, and in executing this Agreement, Contractor certifies that its actions and omissions hereunder shall not incorporate any discrimination arising from or related to any prohibited basis in any Contractor activity, including but not limited to the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship; and further, that Contractor is in full compliance with the provisions of Palm Springs Municipal Code Section 7.09.040, including without limitation the provision of benefits, relating to nondiscrimination in city contracting.

11. MISCELLANEOUS PROVISIONS

11.1 Notice. Any notice, demand, request, consent, approval, or communication that either Party desires, or is required to give to the other Party or any other person shall be in writing and either served personally or sent by pre-paid, first-class mail to the address set forth below. Notice shall be deemed communicated seventy-two (72) hours from the time of mailing if mailed as provided in this Section. Either Party may change its address by notifying the other Party of the change of address in writing.

Item 1M - Page 13
To City:

To Contractor:

City of Palm Springs
Attention: City Manager/ City Clerk
3200 E. Tahquitz Canyon Way
Palm Springs, California 92262
AirBadge, LLC
Attention: Dylan Smallcomb
2777 Yulupa Avenue, Suite 229
Santa Rosa, California 95405

11.2 Integrated Agreement. This Agreement constitutes the entire understanding between the Parties and supersedes and cancels all prior negotiations, arrangements, agreements, representations, and understandings, if any, made by or among the Parties with respect to the subject matter in this Agreement.

11.3 Amendment. No amendments or other modifications of this Agreement shall be binding unless through written agreement signed by all Parties.

11.4 Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. In the event that any one or more of the phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable by valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or sections of this Agreement, which shall be interpreted to carry out the intent of the Parties.

11.5 Successors in Interest. This Agreement shall be binding upon and inure to the benefit of the Parties’ successors and assignees.

11.6 Third Party Beneficiary. Except as may be expressly provided for in this Agreement, nothing contained in this Agreement is intended to confer, nor shall this Agreement be construed as conferring, any rights, including, without limitation, any rights as a third-party beneficiary or otherwise, upon any entity or person not a party to this Agreement.

11.7 Recitals. The above-referenced Recitals are hereby incorporated into the Agreement as though fully set forth in this Agreement and each Party acknowledges and agrees that such Party is bound, for purposes of this Agreement, by the same.

11.8 Authority. The persons executing this Agreement on behalf of the Parties warrant that they are duly authorized to execute this Agreement on behalf of Parties and that by so executing this Agreement the Parties are formally bound to the provisions of this Agreement.

11.9 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original.

Item 1M - Page 14

11.10 No Joint Venture. No agency, partnership, joint venture, or employment is created as a result of this Agreement, and neither party has authority of any kind to bind the other party in any respect whatsoever.

12. FEDERAL PROVISIONS
Since funding for the Services is provided, in whole or in part, by the Federal Aviation Administration, Supplier shall also fully and adequately comply with the provisions included in Exhibit “C” attached hereto and incorporated herein by reference (“Federal Provisions”). With respect to any conflict between such Federal Provisions and the terms of this Agreement and/or the provisions of state law, the more stringent requirement shall control. [SIGNATURES ON NEXT PAGE]
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SIGNATURE PAGE TO AGREEMENT NO. 23S081 BY AND BETWEEN THE CITY OF

PALM SPRINGS AND AIRBADGE LLC
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the dates stated below.

CONTRACTOR:

By: _____________________________________ By: _________________________________________ Signature Signature
(2nd signature required for Corporations)
Date: Date:

CITY OF PALM SPRINGS:

APPROVED BY CITY COUNCIL:

Date: _______ Item No.

APPROVED AS TO FORM: ATTEST:

By: ___________________________ By: _______________________________ City Attorney City Clerk
APPROVED:

By: _______________________________ Date:

City Manager – over $50,000
Deputy/Assistant City Manager – up to $50,000
Director – up to $25,000
Manager – up to $5,000
Item 1M - Page 16
EXHIBIT “A”
CONTRACTOR’S

SCOPE OF SERVICES/WORK
Including,
Schedule of Fees
And
Schedule of Performance
Item 1M - Page 17
Scope:

A. Customization: Contractor to help City configure platform settings for City’s specific needs (excludes adding, modifying, or removing elements or modules to the platform) B. Integration: AAAE Transportation Security Clearinghouse (TSC), AAAE Interactive Employee Training (IET) and PSP’s Security Access Control System (SACS) C. Data Import: Contractor to facilitate a test import and live import of City supplied data.

City understands that successful testing is largely dependent upon coordination and cooperation with Contractor during this phase
D. Technical Support: Contractor will provide support for City via email, telephone or similar as conditions allow. Contractor will respond within one business day E. Change Management: City is responsible for change management. Contractor will provide consultation for formulating change management plan F. Scheduling: Contractor will provide scheduling as part of the core platform which affords users and badge office staff the ability to organize meetings as part of the badge application workflow or as a one-off request
G. Platform services shall include the following:
• Badges
• Badge Applications
• People Signatories
• Companies
• Appointments
• Files
• Audit
• Action Items
• Messaging
• Notifications
• Staff
• TSC Cross Check
• Reports
H. Platform includes the following connectivity modules:
• PACS (Genetec)
• Fingerprints
• TSC
• IET
• Imports
• eSign
Item 1M - Page 18
Product Fees:

Base Licenses 2000
Additional Block of Licenses 500
Fee for each additional Block $18,000
Service Fees:

One-Time Fee $0.00
Annual Subscription $72,000
Payment Interval Annual
Payment Terms Net 30
Annual Fee Increase CPI
Item 1M - Page 19
EXHIBIT “B”

INSURANCE PROVISIONS
Including
Verification of Coverage,
Sufficiency of Insurers,
Errors and Omissions Coverage,
Minimum Scope of Insurance,
Deductibles and Self-Insured Retentions, and
Severability of Interests (Separation of Insureds)
Item 1M - Page 20

INSURANCE

1. Procurement and Maintenance of Insurance. Contractor shall procure and maintain public liability and property damage insurance against all claims for injuries against persons or damages to property resulting from Contractor’s performance under this Agreement.

Contractor shall procure and maintain all insurance at its sole cost and expense, in a form and content satisfactory to the City, and submit concurrently with its execution of this Agreement.

Contractor shall also carry workers’ compensation insurance in accordance with California workers’ compensation laws. Such insurance shall be kept in full force and effect during the term of this Agreement, including any extensions. Should any of the policies be canceled before the expiration date thereof, the issuing company will mail 30 days written notice to the certificate holder named. Certificates of insurance evidencing the foregoing and designating the City, its elected officials, officers, employees, agents, and volunteers as additional named insureds by original endorsement shall be delivered to and approved by City prior to commencement of services. The procuring of such insurance and the delivery of policies, certificates, and endorsements evidencing the same shall not be construed as a limitation of Contractor’s obligation to indemnify City, its elected officials, officers, agents, employees, and volunteers.

2. Minimum Scope of Insurance. The minimum amount of insurance required under this Agreement shall be as follows:

1. Comprehensive general liability and personal injury with limits of at least one million dollars ($1,000,000.00) combined single limit coverage per occurrence and two million dollars ($2,000,000) general aggregate;

2. Professional liability (errors and omissions) insurance with limits of at least one million dollars ($1,000,000.00) per occurrence and two million dollars ($2,000,000) annual aggregate is:
____X_____ required
_________ is not required;

3. Workers’ Compensation insurance in the statutory amount as required by the State of California and Employer’s Liability Insurance with limits of at least one million dollars $1 million per occurrence. If Contractor has no employees, Contractor shall complete the City’s Request for Waiver of Workers’ Compensation Insurance Requirement form.

4. Cyber Liability Insurance with limits not less than $2,000,000 per occurrence or claim, $2,000,000 aggregate. Coverage shall be sufficiently broad to respond to the duties and obligations as is undertaken by Contractor in this agreement and shall include, but not be limited to, claims involving infringement of intellectual property, including but not limited to infringement of copyright, trademark, trade dress, invasion of privacy violations, information theft, damage to or destruction of electronic information, release of private information, alteration of electronic information, extortion and network security. The policy shall provide coverage for breach response costs as well as regulatory fines and penalties as well as credit monitoring expenses with limits sufficient to respond to these obligations.

Item 1M - Page 21

3. Primary Insurance. For any claims related to this Agreement, Contractor’s insurance coverage shall be primary with respect to the City and its respective elected officials, officers, employees, agents, and volunteers. Any insurance or self-insurance maintained by City and its respective elected officials, officers, employees, agents, and volunteers shall be in excess of Contractor’s insurance and shall not contribute with it. For Workers’ Compensation and Employer’s Liability Insurance only, the insurer shall waive all rights of subrogation and contribution it may have against City, its elected officials, officers, employees, agents, and volunteers.

4. Errors and Omissions Coverage. If Errors & Omissions Insurance is required, and if Contractor provides claims made professional liability insurance, Contractor shall also agree in writing either (1) to purchase tail insurance in the amount required by this Agreement to cover claims made within three years of the completion of Contractor’s services under this Agreement, or (2) to maintain professional liability insurance coverage with the same carrier in the amount required by this Agreement for at least three years after completion of Contractor’s services under this Agreement. Contractor shall also be required to provide evidence to City of the purchase of the required tail insurance or continuation of the professional liability policy.

5. Sufficiency of Insurers. Insurance required in this Agreement shall be provided by authorized insurers in good standing with the State of California. Coverage shall be provided by insurers admitted in the State of California with an A.M. Best’s Key Rating of B++, Class VII, or better, unless otherwise acceptable to the City.

6. Verification of Coverage. Contractor shall furnish City with both certificates of insurance and endorsements, including additional insured endorsements, affecting all of the coverages required by this Agreement. The certificates and endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. All proof of insurance is to be received and approved by the City before work commences. City reserves the right to require Contractor’s insurers to provide complete, certified copies of all required insurance policies at any time. Additional insured endorsements are not required for Errors and Omissions and Workers’ Compensation policies.

Verification of Insurance coverage may be provided by: (1) an approved General and/or Auto Liability Endorsement Form for the City of Palm Springs or (2) an acceptable Certificate of Liability Insurance Coverage with an approved Additional Insured Endorsement with the following endorsements stated on the certificate:

A. "The City of Palm Springs, its officials, employees, and agents are named as an additional insured…” ("as respects City of Palm Springs Contract No.___" or "for any and all work performed with the City" may be included in this statement).

B. "This insurance is primary and non-contributory over any insurance or selfinsurance the City may have..." ("as respects City of Palm Springs Contract No.___" or "for any and all work performed with the City" may be included in this statement).

C. "Should any of the above-described policies be canceled before the expiration date thereof, the issuing company will mail 30 days written notice to the Certificate Holder Item 1M - Page 22
named." Language such as, “endeavor to” mail and "but failure to mail such notice shall impose no obligation or liability of any kind upon the company, its agents or representative" is not acceptable and must be crossed out.

D. Both the Workers’ Compensation and Employers' Liability policies shall contain the insurer's waiver of subrogation in favor of City, its elected officials, officers, employees, agents, and volunteers.

In addition to the endorsements listed above, the City of Palm Springs shall be named the certificate holder on the policies.

All certificates of insurance and endorsements are to be received and approved by the City before work commences. All certificates of insurance must be authorized by a person with authority to bind coverage, whether that is the authorized agent/broker or insurance underwriter.

Failure to obtain the required documents prior to the commencement of work shall not waive the Contractor’s obligation to provide them.

7. Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City prior to commencing any work or services under this Agreement. At the option of the City, either (1) the insurer shall reduce or eliminate such deductibles or self-insured retentions with respect to the City, its elected officials, officers, employees, agents, and volunteers; or (2) Contractor shall procure a bond guaranteeing payment of losses and related investigations, claim administration, and defense expenses.

Certificates of Insurance must include evidence of the amount of any deductible or self-insured retention under the policy. Contractor guarantees payment of all deductibles and self-insured retentions.

8. Severability of Interests (Separation of Insureds). This insurance applies separately to each insured against whom claim is made or suit is brought except with respect to the limits of the insurer’s liability.

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Exhibit “C”

FEDERAL AVIATION ADMINISTRATION

FEDERAL PROVISIONS
Provision
Reference Provision Description
Page
No.

FAA - 01 Access to Records and Reports 2
FAA - 02 Affirmative Action Requirement * 3
FAA – 03 Breach of Contract Terms 5
FAA – 04 Buy American Preference * 6
FAA – 05 Civil Rights General 7
FAA – 06 Civil Rights – Title VI Assurances * 8
FAA – 07 Clean Air and Water Pollution Control 11
FAA – 08 Contract Work Hours and Safety Standards Act Requirements 12 FAA – 09 Copeland Anti-Kickback Act 14
FAA – 10 Davis Bacon Requirements 15
FAA – 11 Debarment and Suspension * 22
FAA – 12 Disadvantaged Business Enterprise * 23
FAA – 13 Distracted Driving 25
FAA – 14 Prohibition on Certain Telecommunications and Video Surveillance Services or Equipment
26 FAA – 15 Drug Free Workplace Requirements (not applicable to Contractors)
27 FAA – 16 Equal Employment Opportunity 28
FAA – 17 Federal Fair Labor Standards Act * 36
FAA – 18 Lobbying and Influencing Federal Employees 37
FAA – 19 Prohibition of Segregated Facilities 38
FAA – 20 Occupational Safety and Health Act of 1970 39
FAA – 21 Procurement of Recovered Materials * 40
FAA – 22 Right to Inventions 41
FAA – 23 Seismic Safety 42
FAA – 24 Tax Delinquency and Felony Convictions* 43
FAA – 25 Termination of Contract 44
FAA – 26 Trade Restriction Certification (Foreign) * 45 FAA – 27 Veteran’s Preference 47
FAA – 28 Domestic Preferences for Procurements * 48
*Solicitation Clause also
Item 1M - Page 24
FAA - 01 Access to Records and Reports
The Supplier must maintain an acceptable cost accounting system. The Supplier agrees to provide the City, the Federal Aviation Administration and the Comptroller General of the United States or any of their duly authorized representatives access to any books, documents, papers and records of the Supplier which are directly pertinent to the specific contract for the purpose of making audit, examination, excerpts and transcriptions. The Supplier agrees to maintain all books, records and reports required under this contract for a period of not less than three years after final payment is made and all pending matters are closed.

Reference: 2 CFR § 200.333, 2 CFR § 200.336, FAA Order 5100.38 Item 1M - Page 25
FAA - 02 Affirmative Action Requirement
Not applicable.

Item 1M - Page 26
FAA – 03 Breach of Contract
See Section 4.5 of the Agreement.

Reference: 2 CFR § 200 Appendix II(A)
Item 1M - Page 27
FAA – 04 Buy American Preferences
The Buy American Preference requirement in 49 USC § 50101 requires that all steel and manufactured goods used on AIP projects be produced in the United States. Specific Buy American requirements will be outline in the solicitation documents. If no requirements are found in the solicitation this clause if void.

Reference: Title 49 USC § 50101
Item 1M - Page 28
FAA – 05 Civil Rights General
The Supplier agrees to comply with pertinent statutes, Executive Orders and such rules as are promulgated to ensure that no person shall, on the grounds of race, creed, color, national origin, sex, age, or disability be excluded from participating in any activity conducted with or benefiting from Federal assistance.

This provision binds the Supplier and subcontractors from the bid solicitation period through the completion of the contract. This provision is in addition to that required by Title VI of the Civil Rights Act of 1964.

Reference: 49 USC § 47123
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FAA – 06 Civil Rights – Title VI Assurances
Compliance with Nondiscrimination Requirements:

During the performance of this contract, the Supplier, for itself, its assignees, and successors in interest (hereinafter referred to as the “Supplier”), agrees as follows:

1. Compliance with Regulations: The Supplier (hereinafter includes consultants) will comply with the Title VI List of Pertinent Nondiscrimination Acts and Authorities, as they may be amended from time to time, which are herein incorporated by reference and made a part of this contract.

2. Nondiscrimination: The Supplier, with regard to the work performed by it during the contract, will not discriminate on the grounds of race, color, or national origin in the selection and retention of subcontractors, including procurements of materials and leases of equipment. The Supplier will not participate directly or indirectly in the discrimination prohibited by the Nondiscrimination Acts and Authorities, including employment practices when the contract covers any activity, project, or program set forth in Appendix B of 49 CFR part 21.

3. Solicitations for Subcontracts, including Procurements of Materials and Equipment:

In all solicitations, either by competitive bidding or negotiation made by the Supplier for work to be performed under a subcontract, including procurements of materials, or leases of equipment, each potential subcontractor or supplier will be notified by the Supplier of the Supplier’s obligations under this contract and the Nondiscrimination Acts and Authorities on the grounds of race, color, or national origin.

4. Information and Reports: The Supplier will provide all information and reports required by the Acts, the Regulations, and directives issued pursuant thereto and will permit access to its books, records, accounts, other sources of information, and its facilities as may be determined by the sponsor or the Federal Aviation Administration to be pertinent to ascertain compliance with such Nondiscrimination Acts and Authorities and instructions.

Where any information required of a contractor is in the exclusive possession of another who fails or refuses to furnish the information, the Supplier will so certify to the sponsor or the Federal Aviation Administration, as appropriate, and will set forth what efforts it has made to obtain the information.

5. Sanctions for Noncompliance: In the event of a Supplier’s noncompliance with the nondiscrimination provisions of this contract, the sponsor will impose such contract sanctions as it or the Federal Aviation Administration may determine to be appropriate, including, but not limited to:
a. Withholding payments to the Supplier under the contract until the Supplier complies; and/or
b. Cancelling, terminating, or suspending a contract, in whole or in part.

Item 1M - Page 30

6. Incorporation of Provisions: The Supplier will include the provisions of paragraphs one through six in every subcontract, including procurements of materials and leases of equipment, unless exempt by the Acts, the Regulations, and directives issued pursuant thereto. The Supplier will take action with respect to any subcontract or procurement as the sponsor or the Federal Aviation Administration may direct as a means of enforcing such provisions including sanctions for noncompliance. Provided, that if the Supplier becomes involved in, or is threatened with litigation by a subcontractor, or supplier because of such direction, the Supplier may request the sponsor to enter into any litigation to protect the interests of the sponsor. In addition, the Supplier may request the United States to enter into the litigation to protect the interests of the United States.

A6.4.5 Title VI List of Pertinent Nondiscrimination Acts and Authorities Title VI List of Pertinent Nondiscrimination Acts and Authorities During the performance of this contract, the Supplier, for itself, its assignees, and successors in interest (hereinafter referred to as the “Supplier”) agrees to comply with the following nondiscrimination statutes and authorities; including but not limited to:
• Title VI of the Civil Rights Act of 1964 (42 USC § 2000d et seq., 78 stat. 252) (prohibits discrimination on the basis of race, color, national origin); • 49 CFR part 21 (Non-discrimination in Federally-assisted programs of the Department of Transportation—Effectuation of Title VI of the Civil Rights Act of 1964); • The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, (42 USC § 4601) (prohibits unfair treatment of persons displaced or whose property has been acquired because of Federal or Federal-aid programs and projects); • Section 504 of the Rehabilitation Act of 1973 (29 USC § 794 et seq.), as amended (prohibits discrimination on the basis of disability); and 49 CFR part 27; • The Age Discrimination Act of 1975, as amended (42 USC § 6101 et seq.) (prohibits discrimination on the basis of age);
• Airport and Airway Improvement Act of 1982 (49 USC § 471, Section 47123), as amended (prohibits discrimination based on race, creed, color, national origin, or sex); • The Civil Rights Restoration Act of 1987 (PL 100-209) (broadened the scope, coverage and applicability of Title VI of the Civil Rights Act of 1964, the Age Discrimination Act of 1975 and Section 504 of the Rehabilitation Act of 1973, by expanding the definition of the terms “programs or activities” to include all of the programs or activities of the Federal-aid recipients, sub-recipients and contractors, whether such programs or activities are Federally funded or not);
• Titles II and III of the Americans with Disabilities Act of 1990, which prohibit discrimination on the basis of disability in the operation of public entities, public and private transportation systems, places of public accommodation, and certain testing entities (42 USC Item 1M - Page 31
§§ 12131 – 12189) as implemented by U.S. Department of Transportation regulations at 49 CFR parts 37 and 38;
• The Federal Aviation Administration’s Nondiscrimination statute (49 USC § 47123) (prohibits discrimination on the basis of race, color, national origin, and sex); • Executive Order 12898, Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations, which ensures nondiscrimination against minority populations by discouraging programs, policies, and activities with disproportionately high and adverse human health or environmental effects on minority and low-income populations; • Executive Order 13166, Improving Access to Services for Persons with Limited English Proficiency, and resulting agency guidance, national origin discrimination includes discrimination because of limited English proficiency (LEP). To ensure compliance with Title VI, you must take reasonable steps to ensure that LEP persons have meaningful access to your programs (70 Fed. Reg. at 74087 to 74100);
• Title IX of the Education Amendments of 1972, as amended, which prohibits you from discriminating because of sex in education programs or activities (20 USC 1681 et seq).

Reference: 49 USC § 47123, FAA Order 1400.11
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FAA – 07 Clean Air/Water Pollution Control
If the Agreement exceeds $150,000, Supplier agrees to comply with all applicable standards, orders, and regulations issued pursuant to the Clean Air Act (42 USC § 740-7671q) and the Federal Water Pollution Control Act as amended (33 USC § 1251-1387). The Supplier agrees to report any violation to the City immediately upon discovery. The City assumes responsibility for notifying the Environmental Protection Agency (EPA) and the Federal Aviation Administration.

Supplier must include this requirement in all subcontracts that exceeds $150,000.

Reference: 2 CFR § 200, Appendix II(G)
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FAA – 08 Contract Work Hours and Safety Standards
Not applicable.

Item 1M - Page 34
FAA – 09 Copeland Anti-Kickback
Not applicable.

Item 1M - Page 35
FAA – 10 Davis Bacon Requirements
Not applicable.

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FAA – 11 Debarment and Suspension
A11.3.1 Bidder or Offeror Certification
By submitting a bid/proposal under the solicitation for this contract, the Supplier must have certified that neither it nor its principals are presently debarred or suspended by any Federal department or agency from participation in this transaction.

A11.3.2 Lower Tier Contract Certification

CERTIFICATION OF LOWER TIER CONTRACTORS REGARDING DEBARMENT The Supplier, by administering each lower tier subcontract that exceeds $25,000 as a “covered transaction”, must verify each lower tier participant of a “covered transaction” under the project is not presently debarred or otherwise disqualified from participation in this federally assisted project. The Supplier will accomplish this by:

1. Checking the System for Award Management at website: http://www.sam.gov.

2. Collecting a certification statement similar to the Certification of Offerer /Bidder Regarding Debarment, above.

3. Inserting a clause or condition in the covered transaction with the lower tier contract.

If the Federal Aviation Administration later determines that a lower tier participant failed to disclose to a higher tier participant that it was excluded or disqualified at the time it entered the covered transaction, the FAA may pursue any available remedies, including suspension and debarment of the non-compliant participant.

Reference: 2 CFR part 180 (Subpart C), 2 CFR part 1200, DOT Order 4200.5 Item 1M - Page 37
FAA – 12 Disadvantaged Business Enterprise
Contract Assurance (§ 26.13) –
The Supplier or subcontractor shall not discriminate on the basis of race, color, national origin, or sex in the performance of this contract. The Supplier shall carry out applicable requirements of 49 CFR part 26 in the award and administration of Department of Transportation-assisted contracts. Failure by the Supplier to carry out these requirements is a material breach of this contract, which may result in the termination of this contract or such other remedy as the City deems appropriate, which may include, but is not limited to:
1) Withholding monthly progress payments;
2) Assessing sanctions;
3) Liquidated damages; and/or
4) Disqualifying the Supplier from future bidding as non-responsible.

Prompt Payment (§26.29) – The prime contractor agrees to pay each subcontractor under this prime contract for satisfactory performance of its contract no later than [10 days] days from the receipt of each payment the prime contractor receives from [the City]. The prime contractor agrees further to return retainage payments to each subcontractor within [30 days] days after the subcontractor’s work is satisfactorily completed. Any delay or postponement of payment from the above referenced time frame may occur only for good cause following written approval of the [City]. This clause applies to both DBE and non-DBE subcontractors.

Reference: 49 CFR part 26
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FAA – 13 Distracted Driving

TEXTING WHEN DRIVING
In accordance with Executive Order 13513, “Federal Leadership on Reducing Text Messaging While Driving”, (10/1/2009) and DOT Order 3902.10, “Text Messaging While Driving”, (12/30/2009), the Federal Aviation Administration encourages recipients of Federal grant funds to adopt and enforce safety policies that decrease crashes by distracted drivers, including policies to ban text messaging while driving when performing work related to a grant or subgrant.

In support of this initiative, the City encourages the Supplier to promote policies and initiatives for its employees and other work personnel that decrease crashes by distracted drivers, including policies that ban text messaging while driving motor vehicles while performing work activities associated with the project. The Supplier must include the substance of this clause in all sub-tier contracts exceeding $3,500 that involve driving a motor vehicle in performance of work activities associated with the project.

Reference: Executive Order 13513, DOT Order 3902.10
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FAA – 14 Energy Conservation Requirements
Supplier and Subcontractor agree to comply with mandatory standards and policies relating to energy efficiency as contained in the state energy conservation plan issued in compliance with the Energy Policy and Conservation Act (42 USC 6201et seq).

Reference: 2 CFR § 200, Appendix II(H)
Item 1M - Page 40
FAA – 15 Drug Free Workplace Requirements
The Drug-Free Workplace Act of 1988 requires some Federal contractors and all Federal grantees to agree that they will provide drug-free workplaces as a condition of receiving a contract or grant from a Federal agency. The Act does not apply to contractors, subcontractors, or subgrantees, although the Federal grantees workplace may be where the contractors, subcontractors, or subgrantees are working.

Reference: 49 CFR part 32, Drug-Free Workplace Act of 1988 (41 U.S.C. 701 et seq., as amended)
Item 1M - Page 41
FAA – 16 Equal Employment Opportunity
A16.3.1 EEO Contract Clause
During the performance of this contract, the Supplier agrees as follows:
(1) The Supplier will not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. The Supplier will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, sexual orientation, gender identify, or national origin. Such action shall include, but not be limited to, the following:
employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff, or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Supplier agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause.
(2) The Supplier will, in all solicitations or advertisements for employees placed by or on behalf of the Supplier, state that all qualified applicants will receive considerations for employment without regard to race, color, religion, sex, or national origin. (3) The Supplier will send to each labor union or representative of workers with which it has a collective bargaining agreement or other contract or understanding, a notice to be provided advising the said labor union or workers’ representatives of the Supplier’s commitments under this section and shall post copies of the notice in conspicuous places available to employees and applicants for employment.
(4) The Supplier will comply with all provisions of Executive Order 11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. (5) The Supplier will furnish all information and reports required by Executive Order 11246 of September 24, 1965, and by rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to his books, records, and accounts by the administering agency and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and orders.
(6) In the event of the Supplier’s noncompliance with the nondiscrimination clauses of this contract or with any of the said rules, regulations, or orders, this contract may be canceled, terminated, or suspended in whole or in part and the Supplier may be declared ineligible for further Government contracts or federally assisted construction contracts in accordance with procedures authorized in Executive Order 11246 of September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in Executive Order 11246 of September 24, 1965, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law.
(7) The Supplier will include the portion of the sentence immediately preceding paragraph (1) and the provisions of paragraphs (1) through (7) in every subcontract or purchase order Item 1M - Page 42
unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to section 204 of Executive Order 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The Supplier will take such action with respect to any subcontract or purchase order as the administering agency may direct as a means of enforcing such provisions, including sanctions for noncompliance: Provided, however, that in the event a contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the administering agency the Supplier may request the United States to enter into such litigation to protect the interests of the United States.

A16.3.2 EEO Specification

STANDARD FEDERAL EQUAL EMPLOYMENT OPPORTUNITY

CONSTRUCTION CONTRACT SPECIFICATIONS

1. As used in these specifications:
a. “Covered area” means the geographical area described in the solicitation from which this contract resulted;
b. “Director” means Director, Office of Federal Contract Compliance Programs (OFCCP), U.S. Department of Labor, or any person to whom the Director delegates authority; c. “Employer identification number” means the Federal social security number used on the Employer’s Quarterly Federal Tax Return, U.S. Treasury Department Form 941; d. “Minority” includes:
(1) Black (all persons having origins in any of the Black African racial groups not of Hispanic origin);
(2) Hispanic (all persons of Mexican, Puerto Rican, Cuban, Central or South American, or other Spanish culture or origin regardless of race); (3) Asian and Pacific Islander (all persons having origins in any of the original peoples of the Far East, Southeast Asia, the Indian Subcontinent, or the Pacific Islands); and (4) American Indian or Alaskan native (all persons having origins in any of the original peoples of North America and maintaining identifiable tribal affiliations through membership and participation or community identification).

2. Whenever the Supplier, or any subcontractor at any tier, subcontracts a portion of the work involving any construction trade, it shall physically include in each subcontract in excess of $10,000 the provisions of these specifications and the Notice which contains the applicable goals for minority and female participation and which is set forth in the solicitations from which this contract resulted.

3. If the Supplier is participating (pursuant to 41 CFR part 60-4.5) in a Hometown Plan approved by the U.S. Department of Labor in the covered area either individually or through an association, its affirmative action obligations on all work in the Plan area (including Item 1M - Page 43
goals and timetables) shall be in accordance with that Plan for those trades which have unions participating in the Plan. Contractors shall be able to demonstrate their participation in and compliance with the provisions of any such Hometown Plan. Each contractor or subcontractor participating in an approved plan is individually required to comply with its obligations under the EEO clause and to make a good faith effort to achieve each goal under the Plan in each trade in which it has employees. The overall good faith performance by other contractors or subcontractors toward a goal in an approved Plan does not excuse any covered contractor’s or subcontractor’s failure to take good faith efforts to achieve the Plan goals and timetables.

4. The Supplier shall implement the specific affirmative action standards provided in paragraphs 7a through 7p of these specifications. The goals set forth in the solicitation from which this contract resulted are expressed as percentages of the total hours of employment and training of minority and female utilization the Supplier should reasonably be able to achieve in each construction trade in which it has employees in the covered area. Covered construction contractors performing construction work in a geographical area where they do not have a Federal or federally assisted construction contract shall apply the minority and female goals established for the geographical area where the work is being performed.

Goals are published periodically in the Federal Register in notice form, and such notices may be obtained from any Office of Federal Contract Compliance Programs office or from Federal procurement contracting officers. The Supplier is expected to make substantially uniform progress in meeting its goals in each craft during the period specified.

5. Neither the provisions of any collective bargaining agreement nor the failure by a union with whom the Supplier has a collective bargaining agreement to refer either minorities or women shall excuse the Supplier’s obligations under these specifications, Executive Order 11246, or the regulations promulgated pursuant thereto.

6. In order for the non-working training hours of apprentices and trainees to be counted in meeting the goals, such apprentices and trainees shall be employed by the Supplier during the training period and the Supplier shall have made a commitment to employ the apprentices and trainees at the completion of their training, subject to the availability of employment opportunities. Trainees shall be trained pursuant to training programs approved by the U.S. Department of Labor.

7. The Supplier shall take specific affirmative actions to ensure equal employment opportunity.

The evaluation of the Supplier’s compliance with these specifications shall be based upon its effort to achieve maximum results from its actions. The Supplier shall document these efforts fully and shall implement affirmative action steps at least as extensive as the following:
a. Ensure and maintain a working environment free of harassment, intimidation, and coercion at all sites, and in all facilities at which the Supplier’s employees are assigned to work. The Supplier, where possible, will assign two or more women to each construction project. The Supplier shall specifically ensure that all foremen, superintendents, and other onsite Item 1M - Page 44
supervisory personnel are aware of and carry out the Supplier’s obligation to maintain such a working environment, with specific attention to minority or female individuals working at such sites or in such facilities.
b. Establish and maintain a current list of minority and female recruitment sources, provide written notification to minority and female recruitment sources and to community organizations when the Supplier or its unions have employment opportunities available, and maintain a record of the organizations’ responses.
c. Maintain a current file of the names, addresses, and telephone numbers of each minority and female off-the-street applicant and minority or female referral from a union, a recruitment source, or community organization and of what action was taken with respect to each such individual. If such individual was sent to the union hiring hall for referral and was not referred back to the Supplier by the union or, if referred, not employed by the Supplier, this shall be documented in the file with the reason therefore along with whatever additional actions the Supplier may have taken.
d. Provide immediate written notification to the Director when the union or unions with which the Supplier has a collective bargaining agreement has not referred to the Supplier a minority person or female sent by the Supplier, or when the Supplier has other information that the union referral process has impeded the Supplier’s efforts to meet its obligations. e. Develop on-the-job training opportunities and/or participate in training programs for the area which expressly include minorities and women, including upgrading programs and apprenticeship and trainee programs relevant to the Supplier’s employment needs, especially those programs funded or approved by the Department of Labor. The Supplier shall provide notice of these programs to the sources compiled under 7b above. f. Disseminate the Supplier’s EEO policy by providing notice of the policy to unions and training programs and requesting their cooperation in assisting the Supplier in meeting its EEO obligations; by including it in any policy manual and collective bargaining agreement; by publicizing it in the company newspaper, annual report, etc.; by specific review of the policy with all management personnel and with all minority and female employees at least once a year; and by posting the company EEO policy on bulletin boards accessible to all employees at each location where construction work is performed. g. Review, at least annually, the company’s EEO policy and affirmative action obligations under these specifications with all employees having any responsibility for hiring, assignment, layoff, termination, or other employment decisions, including specific review of these items, with onsite supervisory personnel such superintendents, general foremen, etc., prior to the initiation of construction work at any job site. A written record shall be made and maintained identifying the time and place of these meetings, persons attending, subject matter discussed, and disposition of the subject matter. h. Disseminate the Supplier’s EEO policy externally by including it in any advertising in the news media, specifically including minority and female news media, and providing written Item 1M - Page 45
notification to and discussing the Supplier’s EEO policy with other contractors and subcontractors with whom the Supplier does or anticipates doing business. i. Direct its recruitment efforts, both oral and written, to minority, female, and community organizations, to schools with minority and female students; and to minority and female recruitment and training organizations serving the Supplier’s recruitment area and employment needs. Not later than one month prior to the date for the acceptance of applications for apprenticeship or other training by any recruitment source, the Supplier shall send written notification to organizations, such as the above, describing the openings, screening procedures, and tests to be used in the selection process. j. Encourage present minority and female employees to recruit other minority persons and women and, where reasonable, provide after school, summer, and vacation employment to minority and female youth both on the site and in other areas of a contractor’s workforce. k. Validate all tests and other selection requirements where there is an obligation to do so under 41 CFR part 60-3.
l. Conduct, at least annually, an inventory and evaluation at least of all minority and female personnel, for promotional opportunities and encourage these employees to seek or to prepare for, through appropriate training, etc., such opportunities. m. Ensure that seniority practices, job classifications, work assignments, and other personnel practices do not have a discriminatory effect by continually monitoring all personnel and employment related activities to ensure that the EEO policy and the Supplier’s obligations under these specifications are being carried out.
n. Ensure that all facilities and company activities are non-segregated except that separate or single user toilet and necessary changing facilities shall be provided to assure privacy between the sexes.
o. Document and maintain a record of all solicitations of offers for subcontracts from minority and female construction contractors and suppliers, including circulation of solicitations to minority and female contractor associations and other business associations. p. Conduct a review, at least annually, of all supervisor’s adherence to and performance under the Supplier’s EEO policies and affirmative action obligations.

8. Contractors are encouraged to participate in voluntary associations, which assist in fulfilling one or more of their affirmative action obligations (7a through 7p). The efforts of a contractor association, joint contractor union, contractor community, or other similar groups of which the Supplier is a member and participant may be asserted as fulfilling any one or more of its obligations under 7a through 7p of these specifications provided that the Supplier actively participates in the group, makes every effort to assure that the group has a positive impact on the employment of minorities and women in the industry, ensures that the concrete benefits of the program are reflected in the Supplier’s minority and female workforce participation, makes a good faith effort to meet its individual goals and Item 1M - Page 46
timetables, and can provide access to documentation which demonstrates the effectiveness of actions taken on behalf of the Supplier. The obligation to comply, however, is the Supplier’s and failure of such a group to fulfill an obligation shall not be a defense for the Supplier’s noncompliance.

9. A single goal for minorities and a separate single goal for women have been established.

The Supplier, however, is required to provide equal employment opportunity and to take affirmative action for all minority groups, both male and female, and all women, both minority and non-minority. Consequently, if the particular group is employed in a substantially disparate manner (for example, even though the Supplier has achieved its goals for women generally), the Supplier may be in violation of the Executive Order if a specific minority group of women is underutilized.

10. The Supplier shall not use the goals and timetables or affirmative action standards to discriminate against any person because of race, color, religion, sex, or national origin.

11. The Supplier shall not enter into any subcontract with any person or firm debarred from Government contracts pursuant to Executive Order 11246.

12. The Supplier shall carry out such sanctions and penalties for violation of these specifications and of the Equal Opportunity Clause, including suspension, termination, and cancellation of existing subcontracts as may be imposed or ordered pursuant to Executive Order 11246, as amended, and its implementing regulations, by the Office of Federal Contract Compliance Programs. Any contractor who fails to carry out such sanctions and penalties shall be in violation of these specifications and Executive Order 11246, as amended.

13. The Supplier, in fulfilling its obligations under these specifications, shall implement specific affirmative action steps, at least as extensive as those standards prescribed in paragraph 7 of these specifications, so as to achieve maximum results from its efforts to ensure equal employment opportunity. If the Supplier fails to comply with the requirements of the Executive Order, the implementing regulations, or these specifications, the Director shall proceed in accordance with 41 CFR part 60-4.8.

14. The Supplier shall designate a responsible official to monitor all employment related activity to ensure that the company EEO policy is being carried out, to submit reports relating to the provisions hereof as may be required by the Government, and to keep records. Records shall at least include for each employee, the name, address, telephone number, construction trade, union affiliation if any, employee identification number when assigned, social security number, race, sex, status (e.g., mechanic, apprentice, trainee, helper, or laborer), dates of changes in status, hours worked per week in the indicated trade, rate of pay, and locations at which the work was performed. Records shall be maintained in an easily understandable and retrievable form; however, to the degree that existing records satisfy this requirement, contractors shall not be required to maintain separate records.

15. Nothing herein provided shall be construed as a limitation upon the application of other laws which establish different standards of compliance or upon the application of requirements Item 1M - Page 47
for the hiring of local or other area residents (e.g. those under the Public Works Employment Act of 1977 and the Community Development Block Grant Program).

Reference: 2 CFR 200, Appendix II(C), 41 CFR § 60-1.4, 41 CFR § 60-4.3, Executive Order 11246
Item 1M - Page 48
FAA – 17 Federal Fair Labor Standards Act
The provisions of 29 CFR part 201, the Federal Fair Labor Standards Act (FLSA), are incorporated by reference with the same force and effect as if given in full text. The FLSA sets minimum wage, overtime pay, recordkeeping, and child labor standards for full and part-time workers.

The Supplier has full responsibility to monitor compliance to the referenced statute or regulation.

The Supplier must address any claims or disputes that arise from this requirement directly with the U.S. Department of Labor – Wage and Hour Division.

Reference: 29 USC § 201, et seq
Item 1M - Page 49
FAA – 18 Lobbying and Influencing Federal Employees
Consultants and contractors that apply or bid for an award of $100,000 or more must have certified that it will not and has not used Federal appropriated funds to pay any person or organization for influencing or attempting to influence an officer or employee of any agency, a member of Congress, officer or employee of Congress, or an employee of a member of Congress in connection with obtaining any Federal contract, grant, or another award covered by 31 USC 1352. Each tier must also disclose any lobbying with non-Federal funds that takes place in connection with obtaining any Federal award.

For an award over $100,00, the bidder or offeror certifies by signing and submitting this bid or proposal, to the best of his or her knowledge and belief, that:
• No Federal appropriated funds have been paid or will be paid, by or on behalf of the bidder or offeror, to any person for influencing or attempting to influence an officer or employee of an agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement. • If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete and submit Standard Form-LLL, “Disclosure Form to Report Lobbying,” in accordance with its instructions. • The undersigned shall require that the language of this certification be included in the award documents for all sub-awards at all tiers (including subcontracts, sub-grants, and contracts under grants, loans, and cooperative agreements) and that all sub-recipients shall certify and disclose accordingly.

Reference: 31 USC § 1352 – Byrd Anti-Lobbying Amendment, 2 CFR part 200, Appendix II(J), 49 CFR part 20, Appendix A
Item 1M - Page 50
FAA – 19 Prohibition of Segregated Facilities
Not applicable.

Item 1M - Page 51
FAA – 20 Occupational Safety and Health Act
All contracts and subcontracts that result from this solicitation incorporate by reference the requirements of 29 CFR Part 1910 with the same force and effect as if given in full text. The employer must provide a work environment that is free from recognized hazards that may cause death or serious physical harm to the employee. The employer retains full responsibility to monitor its compliance and their subcontractor’s compliance with the applicable requirements of the Occupational Safety and Health Act of 1970 (20 CFR Part 1910). The employer must address any claims or disputes that pertain to a referenced requirement directly with the U.S.

Department of Labor – Occupational Safety and Health Administration.

Reference: 29 CFR part 1910
Item 1M - Page 52
FAA – 21 Procurement of Recovered Materials
Supplier and subcontractor agree to comply with Section 6002 of the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, and the regulatory provisions of 40 CFR Part 247. In the performance of this contract and to the extent practicable, the Supplier and subcontractors are to use products containing the highest percentage of recovered materials for items designated by the Environmental Protection Agency (EPA) under 40 CFR Part 247 whenever:
1) The contract requires procurement of $10,000 or more of a designated item during the fiscal year; or
2) The contractor has procured $10,000 or more of a designated item using Federal funding during the previous fiscal year.

The list of EPA-designated items is available at www.epa.gov/smm/comprehensiveprocurement-guidelines-construction-products.

Section 6002(c) establishes exceptions to the preference for recovery of EPA-designated products if the contractor can demonstrate the item is:
a) Not reasonably available within a timeframe providing for compliance with the contract performance schedule;
b) Fails to meet reasonable contract performance requirements; or c) Is only available at an unreasonable price.

Reference: 2 CFR § 200.322, 40 CFR part 247, Solid Waste Disposal Act Item 1M - Page 53
FAA – 22 Rights to Inventions
Contracts or agreements that include the performance of experimental, developmental, or research work must provide for the rights of the Federal Government and the City in any resulting invention as established by 37 CFR part 401, Rights to Inventions Made by Non-profit Organizations and Small Business Firms under Government Grants, Contracts, and Cooperative Agreements. This contract incorporates by reference the patent and inventions rights as specified within 37 CFR §401.14. Supplier must include this requirement in all sub-tier contracts involving experimental, developmental, or research work.

Reference: 2 CFR § 200, Appendix II(F), 37 CFR §401
Item 1M - Page 54
FAA - 23 Seismic Safety
Not applicable.

Item 1M - Page 55
FAA – 24 Tax Delinquency and Felony Conviction
The Supplier must have certified under the procurement process that resulted in the award of this contract that:
• Supplier has not been convicted of a Federal felony within the last 24 months; or • Supplier does not have any outstanding tax liability for which all judicial and administrative remedies have lapsed or been exhausted.

Reference: Sections 415 and 416 of Title IV, Division L of the Consolidated Appropriations Act, 2014 (Pub. L. 113-76), and similar provisions in subsequent appropriations acts.

DOT Order 4200.6 - Requirements for Procurement and Non-Procurement Regarding Tax Delinquency and Felony Convictions
Item 1M - Page 56
FAA – 25 Termination of Contract
See Section 4.5 of the Agreement.

Reference: 2 CFR § 200 Appendix II(B), FAA Advisory Circular 150/5370-10, Section 80-09 Item 1M - Page 57
FAA – 26 Foreign Trade Restriction

TRADE RESTRICTION CERTIFICATION
By accepting this contract the Supplier certifies the following statements are true – 1) is not owned or controlled by one or more citizens of a foreign country included in the list of countries that discriminate against U.S. firms as published by the Office of the United States Trade Representative (USTR);
2) has not knowingly entered into any contract or subcontract for this project with a person that is a citizen or national of a foreign country included on the list of countries that discriminate against U.S. firms as published by the USTR; and
3) has not entered into any subcontract for any product to be used on the Federal project that is produced in a foreign country included on the list of countries that discriminate against U.S. firms published by the USTR.

This certification concerns a matter within the jurisdiction of an agency of the United States of America and the making of a false, fictitious, or fraudulent certification may render the maker subject to prosecution under Title 18 USC Section 1001.

The Supplier must provide immediate written notice to the City if the Supplier learns that its certification or that of a subcontractor was erroneous when submitted or has become erroneous by reason of changed circumstances. The Supplier must require subcontractors provide immediate written notice to the Supplier if at any time it learns that its certification was erroneous by reason of changed circumstances.

Unless the restrictions of this clause are waived by the Secretary of Transportation in accordance with 49 CFR 30.17, no contract shall be awarded to an Offeror or subcontractor:
1) who is owned or controlled by one or more citizens or nationals of a foreign country included on the list of countries that discriminate against U.S. firms published by the USTR or
2) whose subcontractors are owned or controlled by one or more citizens or nationals of a foreign country on such USTR list or
3) who incorporates in the public works project any product of a foreign country on such USTR list.

Nothing contained in the foregoing shall be construed to require establishment of a system of records in order to render, in good faith, the certification required by this provision. The knowledge and information of a contractor is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings.

The Supplier agrees it will incorporate this provision for certification without modification in all lower tier subcontracts. The Supplier may rely on the certification of a prospective subcontractor that it is not a firm from a foreign country included on the list of countries that discriminate Item 1M - Page 58
against U.S. firms as published by USTR, unless the Supplier has knowledge that the certification is erroneous.

This certification is a material representation of fact upon which reliance was placed when making an award. If it is later determined that the Supplier or subcontractor knowingly rendered an erroneous certification, the Federal Aviation Administration (FAA) may direct through the City cancellation of the contract or subcontract for default at no cost to the City or the FAA.

Reference: 49 USC § 50104, 49 CFR part 30
Item 1M - Page 59
FAA – 27 Veteran’s Preference
In the employment of labor (excluding executive, administrative, and supervisory positions), the Supplier and all sub-tier contractors must give preference to covered veterans as defined within Title 49 United States Code Section 47112. Covered veterans include Vietnam-era veterans, Persian Gulf veterans, Afghanistan-Iraq war veterans, disabled veterans, and small business concerns (as defined by 15 USC 632) owned and controlled by disabled veterans. This preference only applies when there are covered veterans readily available and qualified to perform the work to which the employment relates.

Reference: 49 USC § 47112(c)
Item 1M - Page 60

ATTACHMENT B

PUBLIC INTEGRITY BUSINESS DISCLOSURE
Item 1M - Page 61
CITY OF PALM SPRINGS – PUBLIC INTEGRITY DISCLOSURE

APPLICANT DISCLOSURE FORM
(Revised 09 13 18)

PUBLIC INTEGRITY DISCLOSURE

APPLICANT DISCLOSURE FORM

1. Name of Entity

2. Address of Entity (Principle Place of Business)

3. Local or California Address (if different than #2)

4. State where Entity is Registered with Secretary of State If other than California, is the Entity also registered in California?  Yes  No

5. Type of Entity
 Corporation  Limited Liability Company  Partnership  Trust  Other (please specify)

6. Officers, Directors, Members, Managers, Trustees, Other Fiduciaries (please specify) Note: If any response is not a natural person, please identify all officers, directors, members, managers and other fiduciaries for the member, manager, trust or other entity _________________________________________________  Officer  Director  Member  Manager [name]
 General Partner  Limited Partner
 Other ____________________________________
_________________________________________________  Officer  Director  Member  Manager [name]
 General Partner  Limited Partner
 Other ____________________________________
_________________________________________________  Officer  Director  Member  Manager [name]
 General Partner  Limited Partner
 Other ____________________________________
AirBadge LLC
2777 Yulupa Ave Suite 229 Santa Rosa, CA 95405
California
Dylan Smallcomb
Nathan Smallcomb
Item 1M - Page 62
✓
✓
CITY OF PALM SPRINGS – PUBLIC INTEGRITY DISCLOSURE

APPLICANT DISCLOSURE FORM
(Revised 09 13 18)

7. Owners/Investors with a 5% beneficial interest in the Applicant Entity or a related entity

EXAMPLE

JANE DOE
[name of owner/investor]
50%, ABC COMPANY, Inc.
[percentage of beneficial interest in entity
and name of entity]
A.
[name of owner/investor] [percentage of beneficial interest in entity
and name of entity]
B.
[name of owner/investor] [percentage of beneficial interest in entity
and name of entity]
C.
[name of owner/investor] [percentage of beneficial interest in entity
and name of entity]
D.
[name of owner/investor] [percentage of beneficial interest in entity
and name of entity]
E.
[name of owner/investor] [percentage of beneficial interest in entity and name of entity]

I DECLARE UNDER PENALTY OF PERJURY UNDER THE LAWS OF THE STATE OF CALIFORNIA THAT THE FOREGOING IS TRUE AND CORRECT.

Signature of Disclosing Party, Printed Name, Title Date Dylan Smallcomb 49.5% of AirBadge LLC
Nathan Smallcomb 49.5% of AirBadge LLC
03/14/2023
Item 1M - Page 63

CITY COUNCIL STAFF REPORT
04/27/2023
SUBJECT:

APPROVE A NEW AIRPORT USE AND LEASE AGREEMENT AND

NON-SIGNATORY AIRLINE OPERATING PERMIT FOR THE PALM SPRINGS

INTERNATIONAL AIRPORT
RECOMMENDATION:

Approve the new AULA for seven Signatory Airlines: Air Canada, Alaska Airlines, American Airlines, Delta Air Lines, Southwest Airlines, United Airlines, and WestJet along with other future eligible airlines desiring to enter into an AULA for an initial five-year term beginning July 1, 2023, through June 30, 2028, with two, two-year extension option periods.

1. Approve the new Permit for five Non-Signatory Airlines: Allegiant, JetBlue, Avelo, Flair, and Sun Country along with other future airlines desiring to obtain a Permit to operate at the Airport on a month-to-month basis beginning July 1, 2023.

2. 3. Authorize the City Manager or his designee to execute all necessary documents.

Attachments
Item 1N

CITY COUNCIL STAFF REPORT
DATE: APRIL 27, 2023 CONSENT CALENDAR
SUBJECT: APPROVE A NEW AIRPORT USE AND LEASE AGREEMENT AND NONSIGNATORY AIRLINE OPERATING PERMIT FOR THE PALM SPRINGS

INTERNATIONAL AIRPORT
FROM: Scott C. Stiles, City Manager
BY: Department of Aviation
SUMMARY:

This action approves a new Airport Use and Lease Agreement (AULA) and a new NonSignatory Airline Operating Permit (Permit) for the Palm Springs International Airport (Airport).

RECOMMENDATION:

1. Approve the new AULA (Attachment A) for seven Signatory Airlines: Air Canada, Alaska Airlines, American Airlines, Delta Air Lines, Southwest Airlines, United Airlines, and WestJet along with other future eligible airlines desiring to enter into an AULA for an initial five-year term beginning July 1, 2023 through June 30, 2028, with two, two-year extension option periods.

2. Approve the new Permit (Attachment B) for five Non-Signatory Airlines: Allegiant, JetBlue, Avelo, Flair, and Sun Country along with other future airlines desiring to obtain a Permit to operate at the Airport on a month-to-month basis beginning July 1, 2023.

3. Authorize the City Manager or his designee to execute all necessary documents.

BACKGROUND:

An Airport Use and Lease Agreement (AULA) establishes the contractual business relationship between an airline and an airport operator, such as the City, typically over a multi-year period (3-5 years). An AULA further specifies the terms and conditions of an airline’s use of and payment for airfield and terminal facilities, including the financial obligations, terms of use, and other responsibilities of each party pertaining to the use of the airport’s facilities as well as the occupancy of land and buildings by the airline.

Item 1N - Page 1
City Council Staff Report
April 27, 2023 -- Page 2
Adoption of New AULA and Permit
The ratemaking methodology used by an airport operator is a key consideration of an AULA because it provides the basis for how an airline will pay an airport operator for the use and occupancy of airport facilities. The determination of a ratemaking methodology is guided by the goals and objectives of an airport operator, the operating environment of the airport, and federal regulations. It is common for an airport operator to use costaccounting principles to establish direct and indirect cost centers for the allocation of both revenues and expenses for purposes of determining airline rates and fees. Residual, Compensatory, and Hybrid are the rate setting methodologies typically used at U.S. airports for establishing airline rates and charges and are described in further detail below:

Residual
• An airport operator recovers the net costs of operating airfield and terminal facilities after crediting all, or a portion of, nonairline revenues to the airline rates and fee requirement.
• Because the airlines receive credit for non-airline revenues, the airlines assume the financial risk should non-airline revenues decrease or fall short of expectations. • Given the assumption of financial risk by the airlines, an airport operator usually grants airlines the right to approve airport capital investment decisions. • Since airlines are credited all or the majority of non-airline revenues for purposes of calculating their rates, the airport operator is typically limited in its ability to build airport equity for future capital investments or other airport funding needs.

Compensatory
• An airport operator calculates the direct and indirect cost of operating the airfield and terminal facilities and recovers only those costs allocated and attributable to those facilities occupied and used by the airlines – i.e., the airfield and terminal. • The airport operator assumes financial risk for operation of the cost centers but retains all non-airline revenue generated on the airport. • Airlines have limited or no input on airport capital investment decisions.

Hybrid
• An airport operator uses both the residual and compensatory methodologies – i.e., airfield is residual while terminal is compensatory – depending upon the ability of one or more airport cost centers to be self-sustaining. • Because both methodologies are used, there is a balance of risk and facility control by and between the airlines and the airport operator.
• To maintain reasonable cost structures, airport operators agree to share with the airlines some portion of year-end actual annual net revenues generated through airport operations.
• Decisions on airport capital investments are typically more balanced between the two parties since the airlines are not being required to serve as the financial backstop for the full operation of the airport.

Item 1N - Page 2
City Council Staff Report
April 27, 2023 -- Page 3
Adoption of New AULA and Permit
STAFF ANALYSIS:

The existing AULA is based on an airport-wide full residual ratemaking methodology, which means the airlines receive 100 percent credit of all non-airline revenues generated at the Airport for purposes of calculating rates and fees. The current AULA has been in effect since July 1, 2014; however, it has been in holdover since June 30, 2022 as the Department of Aviation has continued negotiations with the Signatory Airlines for a new AULA.

The City’s airport-wide residual ratemaking methodology has been in effect for approximately 20 years and has served both the City and airlines well during this period.

However, Airport has, and continues to evolve which has warranted the examination and use of an alternative ratemaking approach which would allow the City to retain a portion of non-airline revenues for purposes of meeting future capital needs and attain greater flexibility for capital investment decisions.

Based upon negotiations with the current AULA Signatory Airlines, the new AULA will use a hybrid approach for setting airline rates and charges whereby the airline landing fee will be based on a residual ratemaking approach while the terminal rental rate will be calculated using a compensatory approach. In addition, the City will share 50 percent of year-end net remaining revenues with the airlines based on annual audited financial and operational data. Use of this hybrid ratemaking methodology would provide the following benefits to the City:
• Balance financial risk and facility control between the City and airlines. • Establish defined and transparent direct and indirect cost centers for purposes of allocating airport revenues and expenses and setting airline rates and charges. • Provides the City with the ability to retain a portion of year end net remaining revenues to build available funds to undertake future capital projects.

The City’s current Permit is also updated to reflect applicable terms and conditions included in the new AULA. The Permit will retain the existing 25 percent premium for those airlines not party to the new AULA and operating through the Permit.

At its meeting on April 19, 2023, the Airport Commission recommended the approval of the agreement and permit.

ENVIRONMENTAL ASSESSMENT:

The requested City Council action is not a “Project” as defined by the California Environmental Quality Act (CEQA). Pursuant to Section 15378(a), a “Project” means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. According to Section 15378(b), a “Project” does not include: (5) Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.

Item 1N - Page 3
City Council Staff Report
April 27, 2023 -- Page 4
Adoption of New AULA and Permit
ALIGNMENT WITH STRATEGIC PLANNING:

Approval of this action supports City Council priority 3A, Community Infrastructure – Improve City Facilities.

FISCAL IMPACT:

The following table presents projections of key financial data for the Airport Fund for the period FY 2024 – 2027 with the use of the hybrid ratemaking approach with year-end revenue sharing:

These projections, based on assumptions and data from the fall of 2022, indicate that the City’s Airport Fund Balance is expected to increase by approximately $10.8 million over this four (4) year period and an equal amount will be shared with the airlines. In addition, the average airline cost per enplaned passenger (CPE) is expected to increase less than $1.00 during this period from $8.13 in FY 2024 to $9.05 in FY 2027. While a new AULA will change the business terms and conditions between the airlines and the City, it will be based on the requirement to continue to adequately provide revenues necessary to fund operating expenditures, local capital improvements, and the required local matching share requirement for all federal and state grant-in-aid.

REVIEWED BY:

Department Director: Harry Barrett, Jr.

Acting Finance Director: Kristopher Mooney
City Attorney: Jeff Ballinger
City Manager: Scott Stiles
ATTACHMENTS:

A. Palm Springs International Airport Use and Lease Agreement B. Palm Springs International Airport Non-Signatory Airline Operating Permit Item 1N - Page 4
Cash Flow 2024 2025 2026 2027 Total
Net Remaining Revenue $5,224,211 $5,418,619 $5,308,055 $5,638,786 $21,589,671 Revenue Sharing Percent
Airport Share 50% 50% 50% 50%
Airline Share 50% 50% 50% 50%
Revenue Sharing Allocation
Airport Share $2,612,105 $2,709,310 $2,654,027 $2,819,393 $10,794,835 Airline Share $2,612,105 $2,709,310 $2,654,027 $2,819,393 $10,794,835 Total $5,224,211 $5,418,619 $5,308,055 $5,638,786 $21,589,671 Effective CPE $8.13 $8.62 $9.15 $9.05

ATTACHMENT A

PALM SPRINGS INTERNATIONAL AIRPORT

USE AND LEASE AGREEMENT
Item 1N - Page 5
Final
Airport Use and Lease Agreement
July 1, 2023
Item 1N - Page 6
Airport Use and Lease Agreement – Final Dated October 24, 2022 i

AIRPORT USE AND LEASE AGREEMENT

TABLE OF CONTENTS
DEFINITIONS ..................................................................................................................... 2 TERM ................................................................................................................................ 11 RIGHTS, SPECIFIC PRIVILEGES, AND AIRLINE PREMISES...................................... 14 CAPITAL EXPENDITURES ............................................................................................. 31 RENTALS AND FEES...................................................................................................... 35 Item 1N - Page 7
Article 1.

Section 1.01 Definitions .. ......................................................................... ................ ........ .......... 2 Section 1.02 Cross-References ..................................................................... ................ .......... 10 Article 2.

Section 2.01 Term .. ...... ........ .......... ............................... .................................... .. ...... .. ...... .. .... 11 Section 2.02 Extension of Agreement ..... ...... .. .. .. ............................. ............ ...... ........ .. ...... ...... 11 Section 2.03 Release of Exclusive Use Space and I or Preferential Use Space ..................... 12 Section 2.04 Surrender of Airline Premises ............................................................................. 12 Article 3.

Section 3.01 Use of the Airport ........................................................................ .... ...... ........ ...... 14 Section 3.02 Specific Rights of Airline at the Airport ............ ........ ...... .................. .... .... ............ 14 Section 3.03 Limitations on Use of Airport ......................... .......... ............ .. ...... .. ... ........ ........... 19 Section 3.04 Airline Space ......................................... ........ ........ ...... .......... ........ ........ .............. 21 Section 3. 05 Availability of Adequate Facilities ................ .............. .. .... .... ........ ........ ........ ........ 22 Section 3.06 Accommodation of Air Transportation Companies .. ...................... .... .... .... .. .... .... 23 Section 3.07 Accommodation of Specific Flights ........... ...... ...... .. ...... .. .............................. ...... 25 Section 3.08 Accommodation of Airline ......................... .... ........ .. ...... .. .................................... 26 Section 3.09 Assignment of Preferential Use Space ........... ........ ........ ........ ........ ........ .. .......... 26 Section 3. 10 Minimum Activity Level ....................................................................... ........ ...... .. 27 Section 3. 11 Reassignment of Preferential Use Space ............................. .............................. 27 Section 3. 12 Additional Preferential Use Space ................................................ ........ ........ ...... 28 Section 3.13 Use of Aircraft Gates Not Assigned on a Preferential Use Basis .... .. ............ .. .... 28 Section 3. 14 Relocation Expenses ....... .. .... ..................................................................... .. ...... 28 Section 3. 15 Employee Parking Facilities ................................................................ ........ ........ 29 Section 3. 16 Access ........................................ ........ ........................ ........................................ 29 Article 4.

Section 4.01 Need for Capital Expenditures ............................................................................ 31 Section 4.02 Issuance of Bonded Indebtedness ...... ............ ........ ........ ........ ........ .................... 31 Section 4.03 Review of Capital Expenditures ............................................................ .. ............ 31 Article 5.

Section 5.01 Landing Fees .......... ................ ........ ........ ........ ........ .... .... .... .... .... .... .... .... .... .... .... 35 Section 5.02 Baggage Handling System Fees ................. .................................................. .. .... 35 Section 5.03 Loading Bridge Fees ......................................................... .... ........................ ...... 36 Section 5.04 Terminal Building Rentals .. ....................................... ........ .......... ........ ........ ........ 36 Section 5. 05 Monthly Activity Report ............................... .......... .. ...... .. ...... .. ................ ............ 37 Section 5.06 Time of Payment ........ .. ...... ................................................................................. 37 Section 5.07 Payments ...................................................................................... ...... ................ 38 Section 5.08 Additional Charges .................................. ........ ........ ........ ........ ........ ........ .. .... ...... 39 Section 5.09 Passenger Facility Charges ................................................................ ........ ........ 39 Airport Use and Lease Agreement – Final Dated October 24, 2022 ii ADJUSTMENT OF AIRLINE RENTALS AND FEES....................................................... 44 MAINTENANCE, REPAIR, ALTERATIONS AND IMPROVEMENTS............................. 48

DAMAGE OR DESTRUCTION, INSURANCE, INDEMNIFICATION AND
RELEASE OF LIABILITY................................................................................................. 54 ENVIRONMENTAL COMPLIANCE ................................................................................. 62 ASSIGNMENT, SUBLEASE, REASSIGNMENT, MERGER, BANKRUPTCY................ 70 CONDEMNATION ............................................................................................................ 71

RULES AND REGULATIONS, COMPLIANCE WITH LAW,
NONDISCRIMINATION .................................................................................................... 73 Item 1N - Page 8
Section 5. 10 Interest on Overdue Payments ........................................... ........ ........ ................ 39 Section 5. 11 Provision Against Setoffs .............................. ................ .... ........ ........ ........ ........ .. 40 Section 5. 12 Contract Security ......... ............................ ................................... .. ...................... 40 Section 5. 13 Non-Signatory Airline Rates and Charges ..... .............. ............. .......... ........ ........ 42 Section 5. 14 Payment of Utility Charges .......................................... ........................................ 42 Section 5. 15 No Other Fees and Charges .... ............................ ............................. .. ................ 43 Section 5. 16 Audit ...... .. ...... .. ...... .. ...... .. ...... .. ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 43 Article 6.

Section 6.01 Effective Date of Adjustments .... ............................. .... .... ........ .... .... ........ ........ .. .. 44 Section 6.02 City Records .. .... ...................................... ....................... ........ ...... .. ........ ...... .. .... 44 Section 6.03 Reports .. .... .......................... ......................................................................... ...... 44 Section 6.04 Midyear Adjustments ... ........................................... ........ ........ ........ ........ ........ .. .. 45 Section 6. 05 Settlement .. ............ ...... ...... .......... .... .............................. ....... ........ ...... ........ ........ 46 Section 6.06 Airport Revenue Sharing .... ........... ................ ........ .... ........ ........ ........ ........ ........ .. 46 Section 6.07 Incorporation of Exhibit D ............ .... ........................ ........ ........ ........ ...... .. ...... .. .... 47 Article 7.

Section 7.01 Designation of Maintenance and Operation Responsibilities .... .. .... .. ........ .......... 48 Section 7.02 Airline's Responsibilities ................................................................. .... .... ............ 48 Section 7.03 City's Responsibilities ....................................................................................... .. 49 Section 7.04 City's Right to Inspect and Make Repairs ....................... ........ ...... .. ........ ...... .. .... 50 Section 7. 05 Alterations and Improvements ................ .................... ........ ........ ........ ................ 50 Article 8.

Section 8.01 Damage or Destruction ................................... ...... ...... .......... ........ .............. ........ 54 Section 8.02 Insurance .. .. .... ........ .. .......... .... .... ............ .... .... .... .... .... .... .... .... ........ ........ ........ .... 55 Section 8.03 Indemnification ...................................... ........ ........ .............. ........ ........ ........ ........ 59 Section 8.04 Release of Liability Regarding Certain Damages ................ .. .............................. 60 Article 9.

Section 9.01 Definitions .. .. ...... ........ .. ...... ........ .. .. ......... ........ ........ ........ ........ ........ ........ ........ .... 62 Section 9.02 Duty to Comply with Environmental Laws ............... ................ ........ ...... .. ...... .. .. .. 65 Section 9.03 Liability and Responsibility for Corrective Action ............. ........ .... .... ........ ...... .. .... 65 Section 9.04 Right to Inspect and Test ... ........ ............................. ........ ........ ........ ............ ........ 66 Section 9. 05 Duty to Furnish Information ............................................... .................. ........ ........ 67 Section 9.06 Term of Environmental Provisions ....... ..................... ..... ............... ...... ........ ........ 69 Section 9.07 Sustainability ...................... ............................................................................. .... 69 Article 10.

Section 10.01 Assignment and Sublease ......... .. ........... .......................... ........ ................ .. ........ 70 Section 10. 02 Remedies Under Federal Bankruptcy Laws .................................... .. ...... ............ 70 Article 11 .

Article 12.

Airport Use and Lease Agreement – Final Dated October 24, 2022 iii AGREEMENT TO NOT GRANT MORE FAVORABLE TERMS ..................................... 78 DEFAULT AND TERMINATION ...................................................................................... 79 NOTICES .......................................................................................................................... 87 MISCELLANEOUS........................................................................................................... 88 Item 1N - Page 9
Section 12.01 Covenant Against Discrimination . ................................. ........ ........ ........ ........ ...... 73 Section 12. 02 Airport Rules and Regulations ...................... ........ ........ ........ ........ ...... ........ ........ 7 4 Section 12. 03 Compliance with Law .......................................................................................... 75 Section 12. 04 Amendment Required by FAA ................ ........ ............................ ........ ........ ........ 76 Section 12. 05 Assurances Required By FAA. .............. ........ .................... .................... ........ ...... 76 Section 12. 06 14 CFR Part 382 Boarding Assistance for Aircraft Compliance .... ...... ...... .. .... .... 76 Article 13.

Section 13.01 Agreement To Not Grant More Favorable Terms ...... ............ .. ...... .. ...... .. ...... .. .... 78 Article 14.

Section 14.01 Airlines Default and Default Notices ........ ........ ........ ........................ .................... 79 Section 14.02 City's Remedies .................................................. ............ .................................... 81 Section 14.03 Possession by City. .... ......................................................................... ........ ........ 84 Section 14.04 No Remedy Exclusive ........ ............ .... .... ....................................... ........ ........ ...... 84 Section 14.05 Waiver and Voluntary Acts .................................................................. .. ...... .. ...... 84 Section 14.06 Additional Remedy in Bankruptcy ....................................................................... 85 Section 14.07 Events Permitting Termination of Agreement by Airline .................................... .. 85 Section 14.08 Statement Regarding a Certified Access Specialist .... .. ........ .......... .... ........ .... .... 85 Article 15.

Section 15.01 Delivery of Notices ..... .. ............ ............................................................. .. ...... .. .... 87 Article 16.

Section 16.01 Successors and Assigns Bound ... ................................. ........ .......................... .... 88 Section 16. 02 Governing Law ... .......................... ....................................................................... 88 Section 16. 03 Jurisdiction and Venue ........................................................................................ 88 Section 16. 04 Non-Liability ........................................................................................ ........ ........ 88 Section 16. 05 Attorneys' Fees and Costs .................................. ........ .............................. .......... 88 Section 16. 06 Noninterference with Operation of the Airport ..................................................... 89 Section 16.07 Quiet Enjoyment .................. .............. ........ ..................... ........ ........ ...... ...... ........ 89 Section 16. 08 Taxes ........................................................ .................... ................ .. ...... .. ...... .. .... 89 Section 16. 09 Liens ................................................................................................................... 91 Section 16. 10 Subordination to Agreements with the U.S. Government ................ .................... 91 Section 16. 11 Incorporation of Exhibits ................................................... .... .............................. 92 Section 16. 12 Affiliate Designation and Requirements .... .. .......... ........ ........ ........ ...... ................ 92 Section 16. 13 Incorporation of Required Provisions .............................. ...... ...... .. ........ ........ ...... 92 Section 16. 14 Force Majeure .... .. ........ ........ ........ ............... ............ ........ .... ........ ........ ........ .... .... 92 Section 16. 15 Headings ...... ................................... ................ ........ .... ........ ........ ........ ........ .... .... 93 Section 16. 16 Remedies ......................... ........................................................................... ........ 93 Section 16. 17 Nonexclusive Rights .. .. ...... .. ...... ............................. ................ ............ ........ .... .... 93 Section 16. 18 Inspection of Books and Records ... ...... .. ...... .. .............. .... .... .. .... .... ...... .. ...... .. .... 93 Section 16. 19 Generally Accepted Accounting Principles ......................................................... 93 Section 16. 20 General Interpretation ......................................................................................... 94 Section 16.21 Surrender of Possession - Holding Over ................. ........ ........ ........ .................... 94 Section 16.22 Consent Not to be Unreasonably Withheld ................................. ................ ........ 95 Section 16. 23 Authority of Executive Director .................................... ........ ........ ........ ........ ........ 95 Section 16. 24 Invalid Provision .................................................................................................. 95 Airport Use and Lease Agreement – Final Dated October 24, 2022 iv

LIST OF EXHIBITS
Item 1N - Page 10
Section 16.25
Section 16. 26
Section 16.27
Section 16.28
Section 16. 29
Section 16.30
Section 16.31
Section 16.32
Section 16.33
Section 16.34
Section 16.35
Section 16.36
Section 16.37
Exhibit A
Exhibit B
Exhibit C
Exhibit D
Exhibit E
Exhibit F
Exhibit G
Exhibit H
Public Address System ................ ........................... ........ ........ ........ .... .. ...... ........ 96 Employees of Airline ..................................................... ........ ........ .. ........ ........ .... 96 Removal of Disabled Aircraft ............................................................................... 96 Licenses, Fees and Permits .................... ........ ........ .................................... ........ 97 Airport Access License Permit ............................................................................ 97 14 Code of Federal Regulations Part 77 Compliance ... .... .. ........ ........ ...... .. ........ 97 Reservations -Airspace and Noise ................................... .... ........ ........ .. .... ........ 97 National Emergency. .......................... .. ............................... .. ...... .......... .. ............ 97 Time is of the Essence .................................... ........ ........................ ........ ............ 98 Noise Abatement and Mitigation .......... ............................................................... 98 Authority for Agreement .................... .................. .. .. ........ ................ .... .... ............ 98 No Oral Agreements ............ ........ ........ ........................... ................ ........ ...... ...... 98 Entire Agreement ........... .. ........ ............................... .......... .. ...... .. ...... .. ...... .. ........ 99 Airport Boundary
Terminal Building Space Maps
Summary of Terminal Building Areas
Rates for Rentals, Fees and Charges
Responsibilities of City and Airline for Operation and Maintenance of the Terminal Building
Affiliate Identification and Requirements
Monthly Activity Report
Federal Nondiscrimination Requirements
Airport Use and Lease Agreement – Final Dated October 24, 2022 1

AIRPORT USE AND LEASE AGREEMENT
This AIRPORT USE AND LEASE AGREEMENT (“Agreement”) made and entered into as of the day of by and between the CITY OF
PALM SPRINGS, a charter city and municipal corporation organized and existing under the laws of the State of California (“City”), and , a
corporation organized and existing under the laws of the State of _ (“Airline”).

RECITALS
A. The City owns and operates the Palm Springs International Airport (“Airport”), located in the City of Palm Springs, County of Riverside, State of California.

B. City operates the Airport as a governmental function for the primary purpose of providing to the public the service of air transportation.

C. Airline is engaged in the business of commercial air transportation of persons, property, cargo and mail (“Air Transportation”) and desires to enter into a use and lease agreement covering certain premises, facilities, rights, licenses, services and privileges at the Airport.

D. City and Airline mutually desire to enter into an Agreement to set forth the rights, privileges, and obligations of both parties with respect to the leased portions of the Airport, and to grant operating privileges at the Airport subject to the terms and conditions hereinafter set forth.

E. City and Airline desire to enter into this Agreement also to facilitate the development, promotion, and improvement of air commerce for the Coachella Valley region and its visitors.

F. City has the right to permit and to grant the use of its property at the Airport to Airline for the operation of Airline’s Air Transportation services.

G. To the extent this Agreement may be construed as an exclusive or limited agreement in connection with the management of the Airport’s facilities and concessions, which is not the parties intent, the Airline acknowledges that this Agreement is being entered into under the provisions of California Public Utilities Code Section 21690.5 et seq.

NOW, THEREFORE, in consideration of the mutual covenants and promises in this Agreement, the parties hereto covenant, agree and bind themselves as follows:

Item 1N - Page 11
Airport Use and Lease Agreement – Final Dated October 24, 2022 2

DEFINITIONS
Definitions
When used elsewhere in this Agreement, the words and phrases in this Section

1.01 shall have the following meanings:

A. “Affiliate” shall mean any Air Transportation Company that:
(1) is a parent or subsidiary of Airline, a subsidiary of the parent of Airline or otherwise under common control with Airline.
(2) shares an International Air Transport Association (IATA) code with Airline at the Airport.
(3) otherwise operates under essentially the same trade name as Airline or its parent or subsidiary at the Airport or uses essentially the same livery as Airline or its parent or subsidiary; provided that no “major” airline, as such term is defined by the FAA, shall be classified as an Affiliate of another “major” airline unless either clause (1) or (3) above defines the relationship between such airlines at the Airport. A Signatory Airline must designate in writing to the City any Air Transportation Company that will be an Affiliate of that Signatory Airline at the Airport. A Signatory Airline must also designate in writing to the City to terminate such Affiliate status of an Air Transportation Company. Affiliates shall have the rights afforded Airline without payment of any additional charges or premiums, provided Airline:
(a) remains a Signatory Airline to this Agreement.
(b) agrees to be billed for Affiliate’s activity at the Airport related to activity under Airline’s brand; while it is flying on the behalf of Airline at the Airport.
(c) agrees and shall be obligated to serve as a financial guarantor for all rentals, fees, and charges incurred by any Affiliate of Airline while it is Item 1N - Page 12
Article 1.

Section 1.01
Airport Use and Lease Agreement – Final Dated October 24, 2022 3 flying on behalf of Airline at the Airport. Airline shall be responsible for any and all unpaid rentals, fees, and charges of any such Affiliate while such Affiliate operates at the Airport as an Affiliate of Airline; provided however, Airline shall only be responsible for such payments as relate to any terminated Affiliate’s operations before such termination as an Affiliate of Airline took effect. Termination as an Affiliate of Airline will not occur until Airline notifies City in writing and such termination will be effective as of the date of such notification.

B. “Agreement” shall mean this Signatory Airline-Airport Use and Lease Agreement between City and Airline, as the same may be amended, modified or altered from time to time pursuant to the terms hereof.

C. “Aircraft Aprons” shall mean those areas of the Airport that are designated by the City for the parking of Airline aircraft and support vehicles, and the loading and unloading of passenger aircraft.

D. “Aircraft Arrivals” shall mean any and all landings by aircraft at the Airport but shall exclude any landings by general aviation aircraft or by aircraft owned or operated by the U.S. Government.

E. “Aircraft Gate” shall mean a specific portal located in the Bono and RJ Concourse passenger holdrooms which provides passenger access to and from an Aircraft Parking Position. Bono Concourse Aircraft Gates include, CUPPS system and equipment, a gate podium, a Loading Bridge, and adjoining Aircraft Parking Position while RJ Concourse Aircraft Gates include CUPPS system and equipment, a gate podium, and an adjoining ground level Aircraft Parking Position.

Aircraft Gates are shown on Exhibit B.

F. “Aircraft Parking Position” shall mean the marked positions located on the Aircraft Aprons adjacent to the Bono and RJ Concourses where Airline aircraft are required to park to enplane and deplane passengers.

G. “Airfield” shall mean those portions of the Airport provided for the Item 1N - Page 13
Airport Use and Lease Agreement – Final Dated October 24, 2022 4 landing, taking off, and taxiing of aircraft, including runways, taxiways, approach and runway protection zones, safety areas, infield areas, landing and navigational aids, and land areas required by or related to aeronautical use of the Airport (other than the Aircraft Aprons).

H. “Airline” shall mean the Air Transportation Company executing this Agreement.

I. “Airline Premises” shall mean those areas in the Terminal Building assigned to Airline as Exclusive Use Space, Preferential Use Space or Joint Use Space, as defined herein, and shown in Exhibits B and C, attached hereto and incorporated herein.

J. “Airport” shall mean the Palm Springs International Airport owned and operated by the City of Palm Springs, the location of which is 3400 East Tahquitz Canyon Way, Palm Springs, California, Riverside County, as it exists as of the effective date of this Agreement and as it may be changed from time to time in the future.

K. “Airport Budget” shall have the meaning set forth in Exhibit D, Section I – Definitions.

L. “Airport Cost Center” shall have the meaning set forth in Exhibit D.

M. “Airport Purpose” shall mean any action or undertaking by City directly or indirectly related to the development and preservation of the Airport for air commerce.

N. “Airport Revenue” shall have the meaning set forth in Exhibit D, Section I – Definitions.

O. “Airport Revenue Sharing” shall mean a portion of Net Remaining Airport Revenues that the City will share with the Signatory Airlines as further described in Section 6.06 and will be calculated in accordance with Table D-7 of Exhibit D.

Item 1N - Page 14
Airport Use and Lease Agreement – Final Dated October 24, 2022 5 P. “Airport Rules and Regulations” shall mean those certain rules and regulations adopted by the City for the use and occupancy of the Airport as described further in Section 12.02.

Q. “Air Transportation” shall mean the carriage of persons, property, cargo, baggage, or mail by aircraft.

R. “Air Transportation Business” shall mean the business operated by Airline at the Airport for the commercial transportation by air of persons, property, mail, parcels, or cargo and associated services.

S. “Air Transportation Company” shall mean a legal entity engaged in the business of scheduled or non-scheduled commercial transportation by air of persons, property, mail, parcels or cargo and associated services.

T. “Baggage Handling System, or BHS” shall mean the City-owned systems and equipment at the Airport, exclusive of the TSA inspection systems and equipment, used for the transportation of checked baggage.

U. “Bonds” shall mean any bonds issued by the City for Capital Expenditures in accordance with a Master Indenture of Trust.

V. “Bond Coverage” shall mean, for any series of Bonds, a given percentage of the Annual Bond Debt Service as identified in the Master Indenture at the time of the issuance of the Bonds.

W. “Capital Expenditure” shall have the meaning set forth in Exhibit D, Section 1 – Definitions.

X. “City” shall mean the City of Palm Springs, California.

Y. “City Council” shall mean the governing body of the City of Palm Springs.

Z. “City Manager” shall mean the City Manager of the City of Palm Item 1N - Page 15
Airport Use and Lease Agreement – Final Dated October 24, 2022 6 Springs, or the City Manager’s designee.

AA. “Code of Federal Regulations, or CFR” shall mean the codification of the general and permanent rules published in the Federal Register by executive departments and agencies of the United States of America.

BB. “Common Use Passenger Processing System (CUPPS)” shall mean City-owned IT systems and equipment provided, by the City for use by Airline, including but not limited to systems and equipment for passenger processing, flight and baggage information display, and baggage handling.

CC. “Debt Service” shall have the meaning set forth in Exhibit D, Section I – Definitions.

DD. “Default” or “Event of Default” shall mean the events set forth in Section 14.01.

EE. “Deplaned Passenger” shall mean any revenue passenger disembarking an aircraft at the Terminal Building, including any such passenger that shall subsequently board another aircraft of the same or a different Air Transportation Company or the same aircraft, previously operating under a different flight number.

FF. “Effective Date” shall mean July 1, 2023.

GG. “Executive Director” shall mean the person designated Executive Director by City, or such other person, division, department, bureau or agency, as may be designated by the City Council or the City Manager from time to time to exercise functions equivalent or similar to those now exercised by the Executive Director; the term also includes any person expressly designated by the Executive Director to exercise rights/and or obligations empowered in the “Executive Director” under this Agreement.

HH. “Expiration Date” shall mean June 30, 2028 unless extended in accordance with Section 2.02 of this Agreement.

Item 1N - Page 16
Airport Use and Lease Agreement – Final Dated October 24, 2022 7 II. “Enplaned Passenger” shall mean any revenue passenger boarding an aircraft at the Terminal Building, including any such passenger that previously disembarked from another aircraft of the same or a different Air Transportation Company or from the same aircraft, previously operating under a different flight number.

JJ. “Exclusive Use Space” shall mean that space set forth in Exhibits B and C consisting of Airline office, operations, and curb-side check in space and leased by City to Airline for Airline’s sole use.

KK. “FAA” shall mean the Federal Aviation Administration of the United States Government or any federal agency or agencies succeeding to its jurisdiction.

LL. “Fiscal Year” shall mean the twelve (12) month period beginning July 1 of any year and ending June 30 of the following year or any other period adopted by City for its financial affairs.

MM. “Joint Use Charge” shall have the meaning set forth in Exhibit D, Section I – Definitions.

NN. “Joint Use Space” shall mean that space set forth in Exhibit B, which is attached hereto and incorporated herein, and leased by City to Airline for shared use with one or more other airlines.

OO. “Majority In Interest of Airlines” (“MII”) shall mean Signatory Airlines who together had at least fifty-one percent (51%) of the Signatory Airlines’ Enplaned Passengers, including those carried by the Signatory Airlines’ Affiliates, and at least fifty-one percent (51%) of the signatory Airlines in count, during the immediately preceding Fiscal Year for any Capital Expenditures in the Airfield, Baggage Handling System (BHS), Loading Bridge, or Terminal Building Cost Centers, which are subject to review of Capital Expenditures as described in Section 4.03
Item 1N - Page 17
Airport Use and Lease Agreement – Final Dated October 24, 2022 8 PP. “Master Indenture” shall mean the Master Indenture of Trust, dated as of July 1, 2019, between the City and U.S. Bank National Association, as trustee and any subsequent ordinance or resolution, heretofore or hereafter adopted, amendatory or supplemental thereto, authorizing the issuance of Bonds or other securities or obligations which are payable from or secured by all or any part of the Airport Revenue.

QQ. “Maximum Gross Landing Weight” shall mean that maximum certificated weight, in thousand (1,000) pound units, of each aircraft authorized by the FAA to land at the Airport as recited in Airline’s flight manual governing that aircraft type.

RR. “Net Remaining Airport Revenue” shall have the meaning set forth in Exhibit D, Section I – Definitions.

SS. “Non-Signatory Airline” shall mean an Airline or its Affiliate or any other Aircraft Operator serving the Airport that has entered into an airport non-signatory permit agreement with the City, which meets the requirements and is paying 1.25 times the rates as outlined in Exhibit D.

TT. “Non-Signatory Airline Rates” shall mean the rates described in Section 5.13 of this Agreement.

UU. “Operation and Maintenance Expenses or O&M Expenses” shall have the meaning set forth in Exhibit D, Section I – Definitions.

VV. “Passenger Facility Charge (PFC)” shall mean a fee authorized by 49 United States Code (USC) 40117 and regulated by 14 CFR Part 158 as such statute and regulations currently exist or as they may be amended during the Term of this Agreement.

XX. “Preferential Use” shall mean nonexclusive use to which an airline has priority over all other users, subject to the terms and conditions of this Agreement, in common with others.

Item 1N - Page 18
Airport Use and Lease Agreement – Final Dated October 24, 2022 9 YY. “Preferential Use Space” shall mean that portion of Airline Premises that is not Exclusive Use Space or Joint Use Space in which Airline has priority over all other users, subject to the terms and conditions of this Agreement, thereof and as set forth in Exhibit B and Exhibit C.

ZZ. “Public Areas” shall mean those Terminal Building areas not leased on an Exclusive, Preferential, or Joint Use basis, or otherwise, to any person, company or corporation, which are open to the general public. Such areas are shown in Exhibit B.

AAA. “Public View” shall mean those areas within the Terminal Building which are reasonably expected to be seen by the general public when in the Terminal Building.

BBB. “Signatory Airlines” shall mean each Airline and its Affiliates and other Air Transportation Companies serving the Airport that are party to a Signatory Agreement substantially similar to this Agreement selling tickets under their own name and is obligated to pay City rentals and fees in the amount of at least $250,000 per year.”
CCC. “Special Purpose Facilities” shall mean capital improvements or facilities located on any property owned or leased by City and located at Airport which are financed by the issuance of Special Facilities Revenue Bonds.

DDD. “Special Purpose Facilities Revenue Bonds” shall mean any debt of City which is secured by and payable solely from rentals or other charges derived by City under a lease, sale or other agreement (or any document securing the same) between City and the person, firm or corporation utilizing the Special Facilities financed thereby.

EEE. “Substantial Completion” shall mean the date on which City’s architects or engineers certify any premises, or project, at the Airport to be substantially complete as to permit use and occupancy.

Item 1N - Page 19
Airport Use and Lease Agreement – Final Dated October 24, 2022 10 FFF. “Terminal Building” shall mean the passenger terminal building and associated curbside entrance areas located on the Airport as shown on Exhibit B.

GGG. “Total Landed Weight” shall have the meaning set forth in Exhibit D, Section I – Definitions.

HHH. “TSA” shall mean the Office of Homeland Security and Transportation Security Administration, or their authorized successor(s).

III. “Turn” shall mean the arrival and departure of an aircraft from an Airline Gate. The movement of an empty aircraft to or from an Airline Gate shall not constitute a Turn, unless said movement is immediately (a) followed by the enplaning of passengers or (b) preceded by the deplaning of passengers.

Cross-References
All references to articles, sections, and exhibits in this Agreement relate to material in this Agreement unless specifically noted otherwise.

Item 1N - Page 20
Section 1.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 11 TERM
Term
This Agreement shall commence upon execution by City and Airline but no sooner than July 1, 2023 and shall terminate at 11:59 PM (Pacific Time) on June 30, 2028, unless terminated sooner as provided herein (the “Initial Term”).

Extension of Agreement
Provided Airline is not in default of any of the terms and conditions of this Agreement beyond the expiration of applicable notice and cure period, this Agreement shall be automatically extended for two separate two-year periods (the first extension period beginning July 1, 2028 and ending June 30, 2030 [“First Term Extension”] and the second extension period beginning July 1, 2030 and ending June 30, 2032 [“Second Term Extension”]), unless:

A. Should sixty-six percent (66%) or more of Signatory Airlines operating at the Airport provide written notice to City on or before September 30, 2027 for the First Term Extension or on or before September 30, 2029 for the Second Term Extension, of their intent to terminate their individual Agreements with City; or B. City provides written notice to Airline no later than September 30, 2027 for the First Term Extension or on or before September 30, 2029 for the Second Term Extension, of City’s intent to terminate this Agreement.

The parties acknowledge and agree that, if Airline provides notice on or before September 30, 2027 or September 30, 2029 of its intent to terminate this Agreement, the term shall not be extended with respect to Airline, irrespective of whether the Signatory Airline Agreements are extended with other Signatory Airlines. Except as otherwise provided for herein, the renewal term shall be upon the same terms and conditions set forth herein. It is agreed and understood that Airline is under no obligation to remain a Signatory Airline during the First Term Extension or Second Term Extension as provided herein provided Airline notifies Item 1N - Page 21
Article 2.

Section 2.01
Section 2.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 12 City of its decision to no longer remain a Signatory Airline on or before September 30, 2027 or September 30, 2029. No further action shall be required by Airline or City for the extension to take effect.

Release of Exclusive Use Space and / or Preferential Use Space Should this Agreement be extended subject to Section 2.02, Airline will be entitled to release all or part of its Exclusive Use Space or Preferential Use Space provided such release occurs at the same effective dates as the First Term Extension and Second Term Extension. Such changes to Exclusive Use Space or Preferential Use Space will be reflected in updated Exhibits B and C prepared by City.

Surrender of Airline Premises
Airline covenants and agrees that on expiration of the term of this Agreement, or on earlier termination as hereinafter provided, or on reassignment of the Airline Premises to others as hereinafter provided, it will peaceably surrender possession of the Airline Premises, or that portion of the Airline Premises that has been reassigned, as applicable, leased hereunder in good condition, reasonable wear and tear, acts of God, acts of terrorism, fire and other casualties excepted, and City shall have the right to take possession of said Airline Premises, or that portion of the Airline Premises that has been reassigned, as applicable.

Airline shall have the right, on termination or reassignment and within thirty (30) days thereafter, to remove all trade fixtures, equipment and other personal property installed or placed by it at its expense, in, on or about the Airport, subject to any valid lien that City may have thereon for unpaid rentals or fees. All City property damaged by, or as the result of, the removal of Airline’s property shall be restored by Airline, at its own expense, to the condition existing prior to such damage.

Airline shall not abandon any of its property on the Airline Premises. Any and all property not removed by Airline within thirty (30) calendar days from Item 1N - Page 22
Section 2.03
Section 2.04
Airport Use and Lease Agreement – Final Dated October 24, 2022 13 termination or reassignment shall be disposed of by the City and all direct and indirect costs associated with the disposal shall be paid by Airline.

This Section 2.04 shall survive the expiration or termination of this Agreement.

Item 1N - Page 23
Airport Use and Lease Agreement – Final Dated October 24, 2022 14

RIGHTS, SPECIFIC PRIVILEGES, AND AIRLINE PREMISES
Use of the Airport
The parties agree that the purpose of this Agreement is to enable Airline to provide an Air Transportation Business at the Airport. Consistent with this purpose, Airline, its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, and suppliers shall have the right to the use of the Airport and appurtenances, together with all facilities, improvements, equipment, and services that have been or may hereafter be provided for use at or in connection with the Airport, subject to the Airport Rules and Regulations and the terms of this Agreement.

Specific Rights of Airline at the Airport
Consistent with the purpose set forth in Section 3.01, and subject to the terms and conditions of this Agreement, Airline shall have the right to use, in common with others so authorized by City, areas, other than areas leased exclusively or preferentially to others (except as set forth herein), facilities, equipment, and improvements at the Airport for the operation of Airline's Air Transportation Business and all activities reasonably necessary to such operations, to include the following:

A. The landing, taking off, flying over, taxiing, towing, provisioning, and conditioning of Airline's aircraft and, in areas designated by City, the extended parking, servicing, loading or unloading, storage, or maintenance of Airline's aircraft and support equipment subject to the availability of space; provided, however, that Airline will not permit the use of the Airfield by any aircraft operated or controlled by Airline that exceeds the design strength or capability of the Airfield as described in the then-current FAA-approved Airport Layout Plan (ALP) or subsequent engineering evaluation report.

B. The loading and unloading of persons, property, parcels, mail and belly cargo by motor vehicles or other means of conveyance reasonably approved by Item 1N - Page 24
Article 3.

Section 3.01
Section 3.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 15 City at Aircraft Aprons or such other locations as may be designated by the Executive Director.

C. Subject to the provisions of Section 12.02 hereof, Airline shall have the right to perform ground handling services for itself or other airlines engaged in an Air Transportation Business. Said ground handling services may be provided via an independent vendor so long as said vendor is properly licensed by the City to operate on the Airport. In the event Airline agrees to ground handle any portion of the operations of another Air Transportation Company, excluding Affiliates, Airline shall provide City advance written notice of such proposed activities, including a description of the type and extent of services to be provided. Consent shall be in writing and shall not be unreasonably withheld. Notwithstanding the foregoing, Airline shall not provide ground handling services to any Air Transportation Company which does not have the consent of City for the operation of its Air Transportation Business at the Airport and a handling agreement between Airline and the Air Transportation Company.

D. The sale of air transportation tickets and services, the procession of passengers and their baggage for air travel, the sale, handling and providing of mail, freight, and express services, and other reasonable and customary activities associated with Airline’s Air Transportation Business.

E. This Agreement does not convey any rights to Airline to provide commercial ground transportation services to any person upon payment of any fee or charge. However, so long as all applicable ground transportation ordinances, laws, Airport Rules and Regulations are complied with, Airline may provide, directly or by agreement with third parties, prearranged ground transportation services for its employees, or passengers who must be transported to or from the Airport due to weather or other extraordinary event, without the imposition by the City of any ground transportation fees or other charges in addition to those specified in this Agreement, provided that approval of the Executive Director is secured in advance of such transportation. If a third party is utilized to provide such ground Item 1N - Page 25
Airport Use and Lease Agreement – Final Dated October 24, 2022 16 transportation services, then Airline shall provide (or cause to be provided) documentation that the third party’s transportation was provided exclusively to Airline’s employees, or passengers who must be transported to or from the Airport due to weather or other extraordinary event, to the satisfaction of the Executive Director, to receive an exemption from the City of its ground transportation fees and other charges.

F. The purchase at the Airport or elsewhere, of fuels, lubricants, and any other supplies and services, from any person or company, subject to City's right to require that each provider of services or supplier to Airline secures written authorization from City to conduct such activity at the Airport, pays required applicable service-oriented fees, and abides by all reasonable Airport Rules and Regulations established by City. No discriminatory limitations or restrictions shall be imposed by City that interferes with such purchases; provided, however, nothing herein shall be construed to permit Airline to store aviation fuels at the Airport. The granting of the right to store aviation fuels shall be subject to the execution of a separate agreement between Airline and City.

G. The training at the Airport of employees of Airline. Training is to be limited to that incidental to Airline’s Air Transportation Business at the Airport.

Flight training and testing of aircraft and other equipment shall be undertaken by Airline only with the prior written approval of the Executive Director, and to the extent permitted by, and subject to, the conditions of the Airport Rules and Regulations. All training and testing conducted by Airlines shall be incidental to the use of the Airport in the operation by Airline of its Air Transportation Business and shall not unreasonably hamper or interfere with the use of the Airport and its facilities by others entitled to the use of same. City reserves the right to restrict or prohibit such training and testing operations which it deems to unreasonably interfere with the use of the Airport, including excessive noise as reasonably determined by City.

H. The purchase of Airline’s requirements of personal property, services, Item 1N - Page 26
Airport Use and Lease Agreement – Final Dated October 24, 2022 17 food, beverage, other passenger supplies, and any other materials and supplies used by Airline that are incidental to the operation of Airline’s Air Transportation Business. Airline may: (i) provide food and beverages, at Airline's sole cost and expense, or install or maintain vending machines in its non-public Exclusive Use Space, for the sole use of Airline's employees, subject to the approval of the Executive Director, (ii) provide for its own in-flight kitchen for catering services to its passengers and crews, or to those of its Affiliates for consumption aboard aircraft, (iii) provide food and beverages to its customers and guests during irregular operations or emergencies, and (iv) provide food and beverages to its guests in a VIP-type club.

I. The sale, disposition, or exchange of Airline’s aircraft, engines, accessories and other equipment, and materials or supplies (excepting fuel and lubricants), provided that (1) such items are not otherwise available on the Airport from a vendor other than another airline, and (2) such right shall not be construed as authorizing the conduct of a separate regular business by Airline, but as permitting Airline to perform only such functions as are incidental to the operation of its Air Transportation Business.

J. The servicing by Airline, or by its suppliers of materials, or furnishers of services, of aircraft and other equipment operated by Airline including the provision of line maintenance, or other materials or supplies, in Exclusive Use Space or Preferential Use Space areas or other locations designated by the Executive Director.

K. The right, but not the obligation, in conjunction with other Signatory Airline’s operating at the Airport, to form a consortium to perform certain operations and maintenance, janitorial, and passenger services that are the responsibility of Airline and other airlines under the terms of this Agreement. Upon written request from the Executive Director, Airline shall provide a copy of said consortium’s articles of incorporation/formation and By-Laws and other documentation regarding the consortium. Airline further understands and acknowledges that any Item 1N - Page 27
Airport Use and Lease Agreement – Final Dated October 24, 2022 18 consortium formed by airlines to operate at Airport must meet certain minimum operating standards and expectations as set and established by City and the cost to form and operate said consortium shall be borne solely by the Airline and other members of said consortium.

L. The installation, maintenance, and operation, at Airline’s sole expense, of identifying signs, posters, graphics and frequent flier program advertising on Airline Premises, subject to the prior written approval of the Executive Director.

Such signs shall be substantially uniform in size, type and location with those of other airlines, consistent with City’s graphic standards and the Airport Rules and Regulations, and in compliance with all laws and ordinances.

M. The installation, maintenance, and operation, at Airline’s sole expense, of such radio, meteorological, and aerial navigation equipment and facilities at suitable locations on the Airport subject to the prior written approval of the Executive Director. The use and location of such equipment and facilities shall not conflict, impede, or otherwise interfere with other similar equipment and facilities on the Airport; and the use and location of such equipment and facilities on the Airport shall be subject to payment of standard rental rates established by City for such use of the Airport.

N. The installation, maintenance, and operation at Airline’s sole expense, of data and voice transportation, communications equipment (e.g. data, telephone, wireless), network infrastructure components, and support computers with their associated peripherals at suitable locations, as may be necessary or convenient for Airline operations suitable locations on the Airport subject to the prior written approval of the Executive Director. The use and location of such equipment shall not interfere with the use of other similar equipment on the Airport, and the use and location of such equipment on the Airport shall be subject to payment of such nondiscriminatory reasonable fee or charge as may lawfully be established by City for such use of the Airport by Airline.

O. The right to participate in nonexclusive porter services in conjunction Item 1N - Page 28
Airport Use and Lease Agreement – Final Dated October 24, 2022 19 with all airlines serving the Airport to assist passengers with luggage.

P. The right to provide curbside baggage check-in service, the location and operation of which shall be subject to the prior written approval of the City, the Airport Rules and Regulations, and the TSA.

Q. The installation of personal property, including furniture, furnishings, supplies, machinery, and equipment, in Airline’s Exclusive Use Space as Airline may deem necessary, useful or prudent for the operation of its Air Transportation Business. Title to such personal property shall remain with Airline, subject to the provisions of this Agreement.

R. The construction of modifications, finishes, and improvements in Airline Premises as Airline may deem necessary or prudent for the operation of its Air Transportation Business, subject to the provisions of Section 7.05 of this Agreement.

Nothing in this Section 3.02 shall restrict City from requiring a permit and levying a charge on any person or company for conducting business at the Airport.

Furthermore, City intends to levy a charge for such business conducted at Airport, including Airline’s provision of non-Air Transportation services to others, except for ground transportation services provided free of any fee or charge as set forth in Section 3.02 (D) of this Agreement.

Limitations on Use of Airport
In connection with the exercise of Airline's rights under this Agreement, neither Airline nor any of its agents, employees, directors, officers, contractors, invitees, licensees, or representatives shall:

A. Do anything that may interfere with the effectiveness or accessibility of the drainage and sewage system, electrical system, air conditioning system, fire protection system, sprinkler system, alarm system, fire hydrants and hoses, if any, installed or located on or at the Airport.

Item 1N - Page 29
Section 3.03
Airport Use and Lease Agreement – Final Dated October 24, 2022 20 B. Conduct a business of any kind at the Airport except its Air Transportation Business or interfere unreasonably with other persons or tenants leasing or lawfully using Airport facilities. Nothing in this Section shall be construed as in any way limiting the general powers of City to fully exercise its statutory functions.

C. Have installed or maintained in, Preferential Use Space, or Joint Use Space amusement machines, vending machines, public pay phones, facsimile, copy machines, or other machines operated by coins, tokens or credit cards unless otherwise approved by the Executive Director.

D. Not do or permit to be done anything, either by act or failure to act, that shall cause the cancellation or violation of the provisions, or any part thereof, of any policy of insurance for the Airport, or that shall cause a hazardous condition so as to increase the risks normally attendant upon operations permitted by this Agreement. If Airline shall do or permit to be done any act not permitted under this Agreement, or fail to do any act required under this Agreement, regardless of whether such act shall constitute a breach of this Agreement, which act or failure, in and of itself, causes an increase in City's insurance premiums, Airline shall immediately remedy such actions.

E. Keep or store, at any time, flammable or combustible liquids except in storage facilities especially constructed for such purposes in accordance with federal, State, and City laws including the Uniform Fire Code and the Uniform Building Code. For purposes of this Agreement, flammable or combustible liquids shall have the same definitions as set forth in the most recent Uniform Fire Code.

F. Do anything that may be in conflict with 14 CFR Part 139 or jeopardize the Airport’s FAA issued Operating Certificate.

G. Do anything that may be in conflict with the Airport’s TSA approved Airport Security Plan or violate 14 CFR Part 1542.

Item 1N - Page 30
Airport Use and Lease Agreement – Final Dated October 24, 2022 21 Airline Space
A. Subject to the Executive Director’s ability to reassign as provided for in this Agreement, Airline hereby leases space as identified in Exhibits B & C of this Agreement. On or before the Effective Date, the City will issue to Airline a Premises Notice, attached hereto as Exhibit B & C, that will designate which areas of the Airport, if any, the City will make available for Airline’s use as: (i) Exclusive Use Space, (ii) Preferential Use Space and (iii) Joint Use Space. Airline acknowledges and agrees that the Premises Notice may be revised by the City and reissued to Airline from time to time during the Term in accordance with the terms and conditions of this Agreement. The City and Airline agree that, upon issuance by the City, and acknowledgment and acceptance in writing by the Airline, each revised Premises Notice shall be deemed attached to and incorporated into this Agreement as Exhibit B & C, and shall supersede and replace the last issued Premises Notice deemed attached to and incorporated into this Agreement as Exhibit B & C without the need for a written amendment of the Agreement signed by the City and Airline.

B. Airline shall use Exclusive Use Space and Preferential Use Space for office purposes and the sale of Air Transportation, handling, ticketing, billing and manifesting of passengers, baggage, cargo, property and mail in the conduct of its Air Transportation Business or on behalf of any other Air Transportation Company authorized by the Executive Director to use the Airport.

C. Airline shall use its Joint Use Space for purposes designated for such joint use area by the Executive Director.

D. If, during the Term, Airline requires additional Premises, Airline may request such additional Premises by submitting a written request to the Executive Director, and the Executive Director may approve or deny any such request in the Executive Director’s sole discretion, but no such approval will be unreasonably withheld; provided, however, that in determining whether to approve such a written request, the Executive Director shall give due consideration to (a) Airline’s need to Item 1N - Page 31
Section 3.04
Airport Use and Lease Agreement – Final Dated October 24, 2022 22 expand its Premises, including its historical, present and reasonably projected frequency of operations; (b) any planned or completed changes in the Terminal Building; (c) the need to address current or reasonably anticipated operational issues or facility imbalances; (d) the City’s current or future business needs and requirements; (e) competing demands for use of the additional space sought by Airline; and (f) any other factors directly affecting the fair and open competition among Air Carriers operating or desiring to operate at the Airport.

E. All costs associated with any reallocation, reduction or addition requested by Airline under Section 3.04, including without limitation the costs of the City, shall be funded by Airline.

F. A revised Premises Notice will be issued upon any change under this Section 3.04 to adjust the space and any changes to the rental amount.

Availability of Adequate Facilities
A. Airline acknowledges City’s objective to offer to all Air Transportation Companies desiring to serve the Airport access to the Airport and to provide adequate facilities at the Airport. Recognizing that physical and financial limitations may preclude timely expansion of the Airport to meet the stated requests of the Airline or other Air Transportation Companies (“Requesting Airline”) for additional facilities at the Airport, Airline acknowledges that it may be necessary for Air Transportation Companies operating at the Airport, including Airline, to share Preferential Use Space from time to time subject to existing agreements, leases, and the Airport Rules and Regulations. Airline further acknowledges that City may also have a need to accommodate the immediate, non-recurring needs of an Air Transportation Company, such as charters, and flights delayed or diverted due to weather or mechanical reasons.

B. It is the policy of City, to the extent reasonably practicable, to accommodate a Requesting Airline’s need for facilities at the Airport in the following manner: (1) first, by City offering the use of unleased space in the Item 1N - Page 32
Section 3.05
Airport Use and Lease Agreement – Final Dated October 24, 2022 23 Terminal Building to a Requesting Airline and entering into an agreement with the Requesting Airline for the use and occupancy of such unleased space; (2) second, through the use of a City-approved sublease agreement between an Air Transportation Company with an existing agreement with the City and a Requesting Airline; (3) third, through an existing Air Transportation Company accommodation of a Requesting Airline for use of Preferential Use Space as may be required by the City; (4) fourth, through the reassignment of an existing Air Transportation Company’s Preferential Use Space in accordance with the provisions of Section 3.11 of this Agreement; and (5) fifth, through the expansion of Airport facilities, unless in the opinion of City, the physical, financial, or time limitations make such expansion impractical.

C. The parties acknowledge and agree that any accommodation agreement made by Airline with a Requesting Airline voluntarily, or pursuant to a directive from City, shall recognize Airline’s Preferential Use privileges assigned to the Preferential Use Space in question and the necessity that the Requesting Airline’s operations be compatible with those of the Airline.

Accommodation of Air Transportation Companies
A. Upon receipt of a request for an accommodation by a Requesting Airline, the Executive Director will require the Requesting Airline to first coordinate directly with the Signatory Airlines if the Airport facilities being requested, such as an Aircraft Gate, are not available. Airline shall cooperate in good faith with the Executive Director to accommodate the needs of a Requesting Airline by permitting such Requesting Airline to utilize Airline’s Preferential Use Space for such time period(s) as reasonably necessary to permit the Requesting Airline’s scheduled operations at such times when the use of such facilities will not interfere with Airline’s operations, or those of its Affiliates, approved sub-licensees or Air Transportation Companies being handled by Airline.

B. In the event a Requesting Airline and the Signatory Airlines are unable to reach an agreement regarding the Requesting Airline’s requested Item 1N - Page 33
Section 3.06
Airport Use and Lease Agreement – Final Dated October 24, 2022 24 accommodation, the Executive Director will determine whether any Air Transportation Company operating at the Airport, including Airline, has the ability to accommodate any or all of such Requesting Airline’s proposed operations. If the Executive Director determines that Airline has the ability to accommodate the Requesting Airline’s proposed operations, the Executive Director will notify Airline in writing of its determination. In the event Airline objects to the Executive Director’s determination, Airline may notify the Executive Director of its objection within fifteen (15) days of the date of the Executive Director’s notice, which shall include the reasons why Airline believes that it will be unable to accommodate the Requesting Airline. In making its final determination, the Executive Director shall consider Airline’s capabilities, capacity, facilities, plans for future operations, and personnel, Airline’s requirements and contractual obligations, the compatibility of the Requesting Airline’s proposed operations with those of Airline, and the need for labor harmony. If the Executive Director, after considering the information, if any, provided by Airline, reasonably determines that Airline has the capability to accommodate a Requesting Airline, City may direct Airline, in writing, to accommodate the Requesting Airline to the extent of, and during those periods when, the Executive Director deems reasonable and shall provide Airline and the Requesting Airline with a written statement specifying the terms and conditions of the accommodation which shall (i) not interfere with the Airline’s scheduled flights and (ii) commence no earlier than 30 days after delivery of such written statement.

Notwithstanding anything to the contrary contained herein, prior to any Requesting Airline being permitted to use Airline’s leased Airline Premises, the Executive Director shall require such Requesting Airline to indemnify Airline and its officers, directors, employees, agents and Affiliates against any claims, damages, injuries and costs (including reasonable attorneys’ fees) arising from the acts or omissions of the Requesting Airline, its officers, directors, employees, agents, and Affiliates and deliver to Airline reasonably satisfactory evidence of insurance coverage, which insurance shall provide at least the coverages (including amounts) as are required of Airline under this Agreement, and name Airline as an additional insured party. Such indemnification provision, among other things, shall be included in a Item 1N - Page 34
Airport Use and Lease Agreement – Final Dated October 24, 2022 25 written agreement between Airline and Requesting Airline prior to any Requesting Airline being permitted to use Airline’s leased Airline Premises/ C. Notwithstanding the foregoing, in no event shall the requirements of this Section 3.06 be construed to authorize the City to require Airline to alter its scheduled operations, or those of its Affiliates and Air Transportation Companies that are ground handled by Airline, in order to accommodate a Requesting Airline.

In addition, the requirements of this Section 3.06 shall not apply to Airline’s Exclusive Use Space.

D. If Airline accommodates another Air Transportation Company pursuant to this Section 3.06, the Requesting Airline shall pay to the City BHS Fees, Joint Use Fees, Per Use Fees – Aircraft Gate, and Per Use Fees – Ticket Counter, as appropriate and applicable, for space utilized by Requesting Airline.

City will credit the amount of the Per Use Fees to Airline for such accommodation.

Accommodation of Specific Flights
A. Airline shall cooperate in good faith with City to accommodate specific flights of other Air Transportation Companies from time to time, as deemed necessary by the Executive Director, for situations, including, but not limited to, the following:

1. Unscheduled flights, including charters, diversions due to weather and other circumstances not otherwise accommodated or handled by other Air Transportation Companies operating at the Airport.

2. Scheduled flights for which the Air Transportation Company has no assigned Aircraft Gate(s) or its assigned Aircraft Gate(s) are occupied at the time its flight arrives.

B. Airline shall not be required to accommodate other Air Transportation Companies pursuant to this Section 3.07 if Airline’s Preferential Use Aircraft Gate(s) or Ticket Counter are occupied by Airline’s flights or flights of other Air Item 1N - Page 35
Section 3.07
Airport Use and Lease Agreement – Final Dated October 24, 2022 26 Transportation Companies already being accommodated or ground handled by Airline at the time a flight requiring accommodation will arrive; provided, however, the overnight parking of Airline's aircraft at an Aircraft Gate, or at any other time beginning ninety (90) minutes following the arrival of an aircraft and ending one (1) hour before its scheduled departure shall not be deemed an occupied Aircraft Gate for the purposes of this Article, provided that the Executive Director has designated an alternative parking position for such aircraft. Executive Director will provide Airline reasonable advance notice of the need to relocate Airline’s aircraft at an Aircraft Gate.

C. If Airline accommodates another Air Transportation Company’s flight pursuant to this Section 3.07, Requesting Airline shall pay to City BHS Fees, Per Use Fees – Aircraft Gate, Per Use Fees – Ticket Counter, and Joint Use Fees as appropriate for space utilized by Requesting Airline. City will credit the amount of the Per Use Fees to Airline for such accommodation.

Accommodation of Airline
Subject to the terms and conditions of this Agreement, and the good faith cooperation of other Signatory Airlines, Airline shall be entitled to the same rights of accommodation of its needs for use or lease of additional facilities as specified in this Article at any time that Airline requests accommodation or has individual flights needing to be accommodated pursuant to Section 3.07.

Assignment of Preferential Use Space
Upon the Effective Date of this Agreement, the Executive Director will assign Airline one (1) Preferential Use Aircraft Gate and Preferential Use Ticket Counter Space in the Terminal Building. Assignment and use of assigned Preferential Use Aircraft Gate and Preferential Use Ticket Counter Space by Airline will be subject to the provisions of Section 3.10.

Item 1N - Page 36
Section 3.08
Section 3.09
Airport Use and Lease Agreement – Final Dated October 24, 2022 27 Minimum Activity Level
A. On or before July 1 of each year of this Agreement, the City will provide Airline a Preferential Aircraft Gate and Ticket Counter Use Analysis for the immediately preceding six month period. Airline’s average Preferential Aircraft Gate and Ticket Counter use will be calculated by dividing the total number of the Airline’s Turns during the period evaluated by the Preferential Aircraft Gate and Ticket Counter Use Analysis by the total number of preferentially assigned Ticket Counter(s) and Aircraft Gate(s) assigned to Airline. Preferential Aircraft Gate and Ticket Counter Use will be reviewed annually to monitor current use.

B. The Executive Director reserves the right to reassign Airline’s Preferential Aircraft Gate and Ticket Counter Space to another Signatory or NonSignatory Airline if: (1) Airline’s Preferential Aircraft Gate and Ticket Counter Use Analysis indicates Airline’s use of a preferentially assigned Aircraft Gate or Ticket Counter falls below an average of four (4) Turns per day (“Minimum Activity Level”); (2) the Executive Director determines that there is a reasonable need for the Airline’s preferentially assigned Aircraft Gate or Ticket Counter by another Signatory or Non-Signatory Airline and the other Signatory or Non-Signatory Airline meets the required four (4) Turns per day minimum; (3) the City has no available Aircraft Gates or Ticket Counter available to assign to the other Signatory or NonSignatory Airline; and (4) there are no unassigned Aircraft Gates or Ticket Counter Space used by other Signatory Airlines with lower average weekday utilization.

Prior to such reassignment becoming effective, Airline shall have a one-hundred eighty (180) day period to adjust its schedule to four (4) or more Turns per day to avoid reassignment. When determining a specific Preferential Use Aircraft Gate or Ticket Counter to be reassigned, the Executive Director shall coordinate with Airline to ensure that the space Airline retains will be sufficient to support Airline’s operations at the Airport.

Reassignment of Preferential Use Space
If, at any time, the Executive Director determines that Airline does not meet Item 1N - Page 37
Section 3.10
Section 3.11
Airport Use and Lease Agreement – Final Dated October 24, 2022 28 the Minimum Activity Level for Preferential Use Space as set forth in Section 3.10, the Executive Director may cancel Airline’s Preferential Use of such underutilized Preferential Use Space by giving Airline at least thirty (30) days’ prior written notice. If during the thirty (30) days’ notice period provided above Airline institutes additional scheduled aircraft arrivals and departures for the purpose of loading and unloading passengers, which would exceed the number of flights in place by the secondary user, then Airline shall have the right to retain Airline’s Preferential Use of such Preferential Use Space.

Additional Preferential Use Space
Should Airline’s Preferential Aircraft Gate and Ticket Counter Use Analysis indicate that the number of Turns for an assigned Preferential Use Aircraft Gate or Ticket Counter exceed seven (7) per day or should Airline provide City with a published schedule showing seven (7) Turns a day at such preferentially assigned Aircraft Gate or Ticket Counter during an upcoming six (6) month period, the Executive Director may assign a second Preferential Use Gate and additional Preferential Use Ticket Counter Space to Airline subject to availability of such Preferential Use Space.

Use of Aircraft Gates Not Assigned on a Preferential Use Basis Any Aircraft Gate that is not assigned by the Executive Director as a Preferential Use Gate (“Non-Preferential Use Gate”) may be utilized by a Signatory or Non-Signatory Airline, when available, and subject to the Executive Director’s assignment. Use of a Non-Preferential Use Gate will be subject to the Rates and Fees on a Per-Use basis as identified in Exhibit “D.”
Relocation Expenses
In an effort to optimize passenger flow and use of the Airport or to minimize the need for construction of improvements, the Executive Director may request Airline to relocate its operations to alternate comparable areas within the Terminal Building provided such alternate area is comparable to the existing location.

Item 1N - Page 38
Section 3.12
Section 3.13
Section 3.14
Airport Use and Lease Agreement – Final Dated October 24, 2022 29 Subject to the terms and conditions of this Agreement, Airline shall be eligible for reimbursement of its reasonable and necessary relocation costs, as approved by the Executive Director, through Rental Credits. Relocation costs may include moving expenses, construction, signage, rewiring, and other costs incidental to the relocation. Prior to relocation, Airline shall submit a proposal outlining the necessary costs for the relocation, including any plans or specifications for construction, if any. Airline shall use reasonable efforts to minimize costs. City shall retain the right to require competitive quotes for work submitted in the relocation proposal. Airline’s request for reimbursement shall include documentation reasonably satisfactory to City evidencing the costs incurred by Airline to complete the relocation.

Employee Parking Facilities
City will make reasonable efforts to make available area(s) at the Airport for vehicular parking for Airline's personnel employed at the Airport; provided, however, such area(s) shall not be used for the long-term storage of vehicles or trailers; and usage of the area(s) is subject to Section 5.08 and to the Airport Rules and Regulations for such parking established by City at rates established by the City. Long-term shall mean periods greater than two (2) weeks. Airline shall, on request of the Executive Director, provide verification that it is only providing parking for its employees employed at Airport.

Access
A. Subject to the terms of this Agreement, the Airport Rules and Regulations, and such restrictions as Airline may impose with respect to its Exclusive Use Space, City hereby grants to Airline, its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, and suppliers, the right and privilege of access, ingress and egress to the Terminal Building.

B. The ingress and egress provided for in Section 3.16 (A) shall not be Item 1N - Page 39
Section 3.15
Section 3.16
Airport Use and Lease Agreement – Final Dated October 24, 2022 30 used, enjoyed or extended to any person engaging in any activity or performing any act or furnishing any service for or on behalf of Airline that Airline is not authorized to engage in or perform under the terms of this Agreement unless that person is expressly authorized by the Executive Director.

C. The Executive Director shall have the right at any time to close, relocate, reconstruct, change, alter or modify any such means of access provided for Airline’s use pursuant to this Agreement or otherwise, either temporarily or permanently, provided that reasonable notice to Airline and a reasonably convenient and adequate means of access, ingress and egress shall exist or be provided in lieu thereof. City shall suffer no liability by reason thereof, and such action shall in no way alter or affect any of Airline’s obligations under this Agreement, except to the extent the City violates the terms of this Section 3.16.

Item 1N - Page 40
Airport Use and Lease Agreement – Final Dated October 24, 2022 31

CAPITAL EXPENDITURES
Need for Capital Expenditures
The parties hereto recognize that Capital Expenditures to preserve, protect, enhance, expand, or otherwise improve the Airport, or part thereof, will be required during the Term of this Agreement. Any such Capital Expenditures shall be subject to the provisions of Section 4.03, below.

Issuance of Bonded Indebtedness
During the Term of this Agreement, and any extension thereof, the City expressly reserves the right to issue Bonds to finance Airport Capital Expenditures.

This Agreement, and all rights of Airline hereunder, are expressly subordinated and subject to any lien or provisions of any pledge, transfer, hypothecation, or assignment made (at any time) by City to secure Airport Bond financing. This Agreement shall be subject and subordinate to the terms, covenants, and conditions of a Bond Ordinance adopted by the City authorizing the issuance of Bonds for Airport improvements. City may amend or modify the adopted Bond Ordinance or make any change thereto that does not materially adversely affect Airline rights under this Agreement. Conflicts between this Agreement and the Bond Ordinance shall be resolved in favor of the Bond Ordinance. All definitional terms that are not specifically defined herein are to have the meanings set forth in the Bond Ordinance.

Review of Capital Expenditures
On or before March 31 of each Fiscal Year, City shall notify Airline in writing of its intent to undertake, by taking a future recommendation to the City Council, a Capital Expenditure that is anticipated to be funded with one million dollars ($1,000,000) or more in City funds (net of PFCs, CFCs, grants, or insurance proceeds) in the Airfield, Baggage Handling System (BHS), Loading Bridge, or Terminal Building Cost Centers. The notice from City shall include the following Item 1N - Page 41
Article 4.

Section 4.01
Section 4.02
Section 4.03
Airport Use and Lease Agreement – Final Dated October 24, 2022 32 information associated with the Capital Expenditure, which is subject to MII consideration:

1. A description of the proposed Capital Expenditure together with cost estimates and any available preliminary drawings.

2. A statement of the need for such Capital Expenditure.

3. A statement of the benefits to be derived from such Capital Expenditure.

4. The allocation of the cost thereof to the various Airport Cost Centers.

5. City’s preferred means of financing the cost and the Fiscal Year in which the cost will be included in Airline’s rents or fees.

A. Within fifteen (15) days of the date of City’s notice, Airline may request in writing, a meeting with City for the purpose of discussing the proposed Capital Expenditure. In the event a request is timely delivered to City, City shall set a date and time to meet collectively with the Signatory Airlines for the purpose of discussing the proposed Capital Expenditure. City agrees to consider comments and recommendations of the Signatory Airlines with respect to the proposed Capital Expenditure.

B. City may proceed with a Capital Expenditure, unless the Signatory Airlines constituting a MII, issue a written notice to City within thirty (30) days of the date of the meeting that they are requesting a deferral of the Capital Expenditure (“Deferral Notice”), time being of the essence. In the event a timely Deferral Notice is delivered to City, the City would have the option to a) defer the proposed Capital Expenditure for a period of twelve (12) months to reduce the scope and cost of the Capital Expenditure and resubmit it for MII consideration or b) proceed with the Capital Expenditure in a manner so as not to impact airline rates and charges.

Item 1N - Page 42
Airport Use and Lease Agreement – Final Dated October 24, 2022 33 C. City shall have the right to request reconsideration of a deferral of a Capital Expenditure by the Signatory Airlines constituting a MII, and the deferral may be reversed by the Signatory Airlines constituting a MII at any time.

D. Notwithstanding any provision of this Agreement to the contrary, City may proceed at any time with any Capital Expenditure that is not subject to MII consideration hereunder, and with any other planning, construction, improvement or development project that is not defined as a Capital Expenditure hereunder. The following Capital Expenditures shall not be subject to consideration by the Signatory Airlines, including Airline, hereunder and shall be permitted to be undertaken by City at any time:

1. A Capital Expenditure required by any governmental authority having jurisdiction over the Airport, including, but not limited to, the State of California, including any agency or political subdivision thereof, and any federal agency including, but not limited to, the FAA, TSA, and the Department of Transportation.

2. A Capital Expenditure necessary to repair casualty damage to Airport property.

3. Special Purpose Facilities for which the tenant(s) or other user(s) thereof shall be required to reimburse City for the costs of the Capital Expenditure that will be paid with Revenues, including, but not limited to, financing costs.

4. A Capital Expenditure necessary to settle a claim, satisfy a judgment, comply with any judicial or administrative order issued against City by reason of its ownership, operation, maintenance, or use of the Airport.

5. A Capital Expenditure to prevent or address an emergency that might result in the closure of the Airport, or any portion thereof, as reasonably determined by City.

Item 1N - Page 43
Airport Use and Lease Agreement – Final Dated October 24, 2022 34

6. A Capital Expenditure that is required to make available additional Terminal Building space or related facilities for the expansion of an Air Transportation Company, or to make space or facilities available in the Terminal Building to accommodate a new entrant or expanding Air Transportation Company; provided that: (1) such Air Transportation Company enters into a binding commitment to lease the space so made available for at least the remaining Term and on the same terms as provided for the lease of comparable space under this Agreement; and (2) existing space or facilities are not otherwise available to accommodate the Air Transportation Company under Article 3 of this Agreement in a competitive, non-disruptive and otherwise satisfactory manner.

7. A Capital Expenditure that will not impact Signatory Airline rates, fees or charges hereunder.

8. A Capital Expenditure that is anticipated to be funded with one million dollars ($1,000,000) or less in City funds (net of PFCs, CFCs, grants or insurance proceeds) in the Airfield, Baggage Handling System (BHS), Loading Bridge, or Terminal Building Cost Centers Item 1N - Page 44
Airport Use and Lease Agreement – Final Dated October 24, 2022 35

RENTALS AND FEES
Airline shall pay City rentals for use of Airline Premises, and fees and charges for the other rights, licenses, and privileges granted hereunder during the Term of this Agreement including rentals, fees, and charges payable by Airline with respect to the Airfield Area Cost Center, Baggage Handling System (BHS) Cost Center, Loading Bridge Cost Center, and Terminal Building Cost Center. The rentals, fees, and charges for each of these Airport Cost Centers shall be calculated as set forth in Exhibit D.

Landing Fees
Airline shall pay to City monthly fees based on Aircraft Arrivals for the preceding month. Airline’s Landing Fees shall be determined as the product of the Landing Fee Rate for the period, calculated in accordance with Exhibit D attached hereto, and Airline’s Total Landed Weight for the month. Airline’s landed weight for the month shall be determined as the sum of the products obtained by multiplying the Maximum Gross Landing Weight of each type of Airline’s aircraft by the number of landings of each said aircraft during such month.

If Airline fails to furnish City with the report required in Section 5.05, Airline’s Landing Fee shall be determined by assuming that the Total Landed Weight for Airline during the preceding month was one hundred percent (100%) of the Total Landed Weight for the most recent month for which such figure is available. Any necessary adjustment in such Landing Fee shall be calculated after the required report is delivered to City by Airline for the month in question, and resulting surpluses or deficits shall be applied to Airline’s Landing Fee for the next succeeding month.

Baggage Handling System Fees
Throughout the Term of the Agreement, Airline shall pay to City Baggage Handling System Fees calculated in accordance with Exhibit D.

Item 1N - Page 45
Article 5.

Section 5.01
Section 5.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 36 Loading Bridge Fees
Throughout the Term of the Agreement, Airline shall pay to City monthly Loading Bridge Fees calculated in accordance with Exhibit D.

Terminal Building Rentals
“Terminal Building Rentals” shall be determined as the sum of Airline’s rentals for Exclusive Use Space, Preferential Use Space, Joint Use Space, Per Use Fees – Gates, and Per Use Fees – Ticket Counter. (Per Use Fees shall mean the sum of Per Use Fees – Gates, and Per Use Fees – Ticket Counter ).

A. Airline’s annual Terminal Building Rentals for Exclusive Use Space and Preferential Use Space shall be determined as the Terminal Building Rental Rate, calculated in accordance with Exhibit D, multiplied by the amount of the corresponding type of space leased by Airline as Exclusive Use Space and Preferential Use Space as set forth in Exhibits B and C.

B. Total Terminal Building Rentals for Joint Use Space shall be calculated as the Terminal Building Rental Rate for each period calculated in accordance with Exhibit D, multiplied by the Airline’s share of the Joint Use Space. Airline’s share of the Joint Use Space shall be determined in accordance with the Joint Use Formula. City shall use Airline’s Monthly Activity Report, to be submitted by Airline to City in accordance with Section 5.05, for purposes of determining charges for Joint Use Space.

C. The amount due by Airline for Per Use Fees shall be calculated as the product of each Per Use Fee for the applicable period calculated in accordance with Exhibit D, and the number of times Airline used such space. City shall use Airline’s Monthly Activity Report, to be submitted by Airline to City in accordance with Section 5.05, for purposes of determining charges for Per Use Fees.

Item 1N - Page 46
Section 5.03
Section 5.04
Airport Use and Lease Agreement – Final Dated October 24, 2022 37 Monthly Activity Report
Airline shall furnish to the City, on or before the tenth (10th) day of each month, an accurate verified report detailing its operations for the previous month on forms prescribed by the Executive Director. Said report shall include the information presented in Exhibit G and shall be submitted electronically to [email protected]. The acceptance by City of any payment made by Airline shall not preclude City from verifying the accuracy of Airline's report submitted to City as provided in this Section 5.05, or from recovering any additional payment actually due from Airline.

Time of Payment
The following sets forth the time of Airline payments of rents, fees, and charges to City:

A. Rents and fees for Exclusive Use Space and Preferential Use Space shall be due and payable, without invoice, deduction, or setoff, in monthly installments in advance on or before the first day of each month.

B. Landing Fees, BHS Fees, Loading Bridge Fees, Joint Use Fees, Per Use Fees – Gate, Per Use Fees – Ticket Counter, and Non-Terminal Building RON Parking Fees for each month of operations shall be due and payable without deduction or setoff within fifteen (15) days after transmittal of an invoice by City, given that Airline’s monthly statistical report as required in Section 5.05 shall be received by the City within ten (10) days after the last day of the month after such month of operations.

C. Airline shall faithfully collect and promptly remit to City (without notice or demand by City and in accordance with 14 CFR Part 158 (as this regulation may be amended from time to time) the proceeds of the City’s Passenger Facility Charge so long as the City has an approved Passenger Facility Charge in effect.

D. Rents, fees, and charges not described in paragraphs (A), (B), and (C) Item 1N - Page 47
Section 5.05
Section 5.06
Airport Use and Lease Agreement – Final Dated October 24, 2022 38 above shall be due and payable within thirty (30) days after transmittal of a monthly invoice therefore by City. City will provide such invoice within thirty (30) days of activity for which charge is generated.

E. The acceptance of any payment made by Airline shall not preclude City from verifying the accuracy of Airline's report and computations or from recovering any additional payment actually due from Airline or preclude Airline from later demonstrating that Airline's report was inaccurate and that a lesser amount was properly owed (and to recover any such overpayment).

F. In establishing the rents, fees, and charges set forth in this Agreement, City is anticipating timely payment of such rents, fees, and charges. Untimely payment of these rents, fees, and charges jeopardizes the operation of the Airport.

Therefore, in the event that rents, fees, and charges are not paid timely by Airline, the Executive Director is authorized and directed to seek any necessary legal and administrative remedy to obtain collection of the unpaid rents, fees, and charges and to assure timely payment of future rents, fees, and charges. These remedies shall be in addition to late fees required herein and may include any of the following:

1. Seeking administrative relief through appropriate federal agencies, including the FAA.

2. Equitable and judicial remedies.

3. Such other legal and administrative remedies as permitted by law.

G. Failure to send a timely invoice does not relieve Airline from any obligation of payment.

Payments
Rents, fees, and charges shall be paid in United States Dollars by wire, electronic funds transfer, or check payable to The Palm Springs International Item 1N - Page 48
Section 5.07
Airport Use and Lease Agreement – Final Dated October 24, 2022 39 Airport the City of Palm Springs, which shall be delivered or mailed, postage prepaid, to City of Palm Springs, ___________________________ or which may be paid by wire transfers to accounts of the Airport designated in writing by the Executive Director.

Additional Charges
City, after reasonable notice to Airline, may, but is not obligated to, cure any Default on Airline’s part in fulfilling Airline’s covenants and obligations under this Agreement. Any amounts paid or lawful costs incurred by City to cure any such Default(s) are hereby agreed to and declared to be Additional Charges. Unless otherwise provided herein, all Additional Charges shall be due and payable with the next succeeding installment of monthly rent due under this Agreement.

Passenger Facility Charges
Airline agrees to faithfully collect and promptly remit to City (without notice or demand by City and in accordance with 14 CFR Part 158) the proceeds of the City's PFC so long as the City has an FAA approved PFC in effect. Airline shall pay the City interest for late payment of Passenger Facility Charge proceeds to City in accordance with Section 5.10. Further, both Airline and City hereby covenant to fulfill their responsibilities under the terms of 14 CFR Part 158. If legislation and regulations, in effect on the date of this Agreement, governing passenger facilities charges, use fees, or similar charges on Airline’s passengers using the Airport are amended, changed, or eliminated during the term of this Agreement, the City reserves the right to appropriately adjust such charges, levy new charges, revise charges, or implement additional charges as determined by the City to be necessary. City may seek PFC funding for PFC eligible projects rather than funding by Airline rates and charges.

Interest on Overdue Payments
Without waiving any other rights available to City, in the event of default in Airline's payment of rentals, fees or charges under this Agreement, including Item 1N - Page 49
Section 5.08
Section 5.09
Section 5.10
Airport Use and Lease Agreement – Final Dated October 24, 2022 40 Passenger Facility Charge proceeds, in the event that Airline is delinquent for a period of seven (7) calendar days or more from the date when due in paying City any such rentals, fees or charges, and Airline fails to cure any such delinquency within five (5) business days after receiving written notice from City, Airline shall pay City interest thereon, from the date such rents, fees or charges become payable to the date of payment at the rate of one and one-half percent (1.5%) per month; provided, however, that if the maximum rate then provided by law is less than one and one-half percent (1.5%) per month, then the rate shall be such maximum legal rate. City may, but is not obligated to, provide Airline with a written reminder where invoiced rentals, fees or charges have not been received within thirty (30) calendar days of transmittal of the invoice therefor.

Provision Against Setoffs
It is the obligation of Airline to pay all fees and charges, free of any setoffs or claims, in the amount and at the times specified in this Agreement. In the event that Airline desires to contest the validity or amount of any such fees and charges, Airline shall first pay the same to City and may then seek a refund in any appropriate forum.

Contract Security
A. Unless Airline has provided regularly scheduled flights to and from the Airport pursuant to an agreement with City for no less than eighteen (18) consecutive months prior to the Effective Date without violating such agreement beyond any applicable cure period, Airline shall provide City with a clean, irrevocable letter of credit, surety bond or other security acceptable to City (“Contract Security”) in an amount equal to City’s estimate of three (3) months’ fees and charges payable by Airline hereunder, to guarantee the faithful performance by Airline of its obligations under this Agreement and the payment of all fees and charges due hereunder. The Contract Security shall be provided to City prior to the Effective Date. Airline shall be obligated to maintain the Contract Security in effect for no less than eighteen (18) consecutive months. The Contract Item 1N - Page 50
Section 5.11
Section 5.12
Airport Use and Lease Agreement – Final Dated October 24, 2022 41 Security shall be in a form and issued by a company reasonably acceptable to City.

In the event that any such Contract Security shall be for a period of less than the full period required by this Agreement, or if the Contract Security may be canceled, Airline shall provide a renewal or replacement Contract Security at least sixty (60) days prior to the later of: (1) the date the Contract Security expires, or (2) the effective date of cancellation of the Contract Security.

B. If an Event of Default occurs hereunder (as set forth in Section 14.01), or upon Airline’s election to assume this Agreement under federal bankruptcy laws, City shall have the right to impose or re-impose the Contract Security requirements of Section 5.12(A) above upon Airline by written notice to Airline. In such event, Airline shall provide City with the required Contract Security within ten (10) days of receipt of City’s written notice and shall thereafter maintain such Contract Security for a period of no less than eighteen (18) consecutive months. To the extent no Event of Default occurs, and Airline makes no act or omission that, with the passage of time or giving of notice, or both, would constitute an Event of Default hereunder for a period of eighteen (18) consecutive months, Airline shall be released from its obligation to maintain the Contract Security required by this Section. City’s rights under this Section shall be in addition to all other rights and remedies available to City either by law or under the terms and conditions of this Agreement.

C. If Airline is more than fourteen (14) days late for three (3) consecutive months in remitting rentals, fees and charges described in Section 5.01 through

5.04, City shall have the right to impose or re-impose the Contract Security requirements of Section 5.12(A) above upon Airline by written notice to Airline. In such event, Airline shall provide City with the required Contract Security within ten (10) days of receipt of City’s written notice and shall thereafter maintain such Contract Security for a period of no less than eighteen (18) consecutive months.

In the event Airline does not remit fees late during the 18-consecutive month period, Airline shall be released from its obligation to maintain the Contract Security required by this Section. City’s rights under this Section shall be in Item 1N - Page 51
Airport Use and Lease Agreement – Final Dated October 24, 2022 42 addition to all other rights and remedies available to City either by law or under the terms and conditions of this Agreement.

D. The parties acknowledge and agree that any Contract Security provided by Airline will not be considered “property of the estate” for purposes of the United States Bankruptcy Code, it being understood that any Contract Security is property of the third party providing it (subject to City’s ability to draw against the Contract Security) and that all PFCs collected by Airline with respect to Enplaned Passengers at the Airport (other than any portion for Airline’s expenses or that is reimbursable to a ticket purchaser), are property of City.

E. Notwithstanding any provision of this Agreement to the contrary, failure to maintain Contract Security as required herein shall constitute a material Default hereunder and shall be grounds for termination of this Agreement in accordance with Article 14 of this Agreement.

Non-Signatory Airline Rates and Charges
Any Air Transportation Company providing service at the Airport that is not a Signatory Airline shall pay a twenty-five (25) percent premium over the rates, fees, and charges charged to Signatory Airlines, as further detailed in Exhibit D.

Non-Signatory Airline landing fees shall be credited against the amounts owed by Signatory Airlines.

Payment of Utility Charges
Airline shall pay promptly for all utilities and utility services used by Airline at or in Airline’s Exclusive Use Space or Preferential Use Space in excess of those utility services specifically provided by City. Airline expressly waives any and all claims against City for compensation for any and all loss or damage sustained by reason of any defect, deficiency or impairment of any water supply system, drainage or sewer system, gas supply system, telephone system, electrical supply system, or electrical apparatus or wires serving the Airline Premises.

Item 1N - Page 52
Section 5.13
Section 5.14
Airport Use and Lease Agreement – Final Dated October 24, 2022 43 No Other Fees and Charges
Except as expressly provided for in this Agreement, no further rentals, fees, or charges shall be charged against or collected by City from Airline, for the Airline Premises, facilities, rights, licenses, and privileges granted to Airline under this Agreement. However, City expressly reserves the right to assess and collect reasonable fees for fuel sales, ground handling services, fuel flowage, fueling services, inflight catering, food/beverage sales, vending, parking, and commercial ground transportation. Also, City expressly reserves the right to assess and collect a Passenger Facility Charge in accordance with Section 5.09.

Anything in this Agreement to the contrary notwithstanding, this Section

5.15 shall not be interpreted or understood as contracting away any City governmental authority.

Audit
Airline agrees to keep books and records on its operations at the Airport, and the Executive Director or any other authorized City representative, upon reasonable advance written notice to Airline, shall have the right to inspect and audit such books and records to ensure compliance with prevailing municipal bond disclosure requirements of the City and to determine that City has received from Airline all moneys due City under the terms hereof, including, but not limited to, rents, fees, and charges and PFCs (if applicable) payable to City by Airline.

Likewise, Airline shall have the right to inspect the books and records of the City relating to the provisions hereof upon reasonable advance written notice to City.

Item 1N - Page 53
Section 5.15
Section 5.16
Airport Use and Lease Agreement – Final Dated October 24, 2022 44

ADJUSTMENT OF AIRLINE RENTALS AND FEES
Effective Date of Adjustments
The Landing Fee, the BHS Fee, the Loading Bridge Fee, and the Terminal Building rental rates, as described in Article 5 and calculated as presented in Exhibit D, shall be adjusted annually as hereinafter set forth. Throughout this Article, whenever the adjustment calculation involves an estimate, the estimate of the Executive Director shall be used. Such adjustments shall be effective on the first day of the Fiscal Year for which they apply.

City Records
A. City shall establish and maintain an Airport accounting system in accordance with Generally Accepted Accounting Principles and shall maintain accounting records that document the following items for each Airport Cost Center:

1. Airport Revenues.

2. Operation and Maintenance Expenses, including Indirect Expenses.

3. Expenses of City incurred for the improvement, renovation, or enhancement of the Airport.

B. City shall further maintain records evidencing the allocation of all capital funds to each Airport Cost Center. Included in the allocation to each Airport Cost Center shall be its proportionate share of the expenses of any Bond issuance, capitalized interest, and funding of special funds, determined with reference to the allocation of costs funded through securities or other capital fund sources. All State and federal funds received by City shall be deposited in the appropriate fund(s).

Reports
A. On or before March 1st of each Fiscal Year, upon request by City, Item 1N - Page 54
Article 6.

Section 6.01
Section 6.02
Section 6.03
Airport Use and Lease Agreement – Final Dated October 24, 2022 45 Airline shall submit to City for budgetary purposes, a written estimate of the Total Landed Weight for Airline for the succeeding Fiscal Year.

B. On or before April 30 of each Fiscal Year, the Executive Director shall submit to Airline the following reports in addition to report(s) described in Section

4.03. 1. City’s proposed Airport Budget for the succeeding Fiscal Year which shall include:
a. Estimated Airport Operation and Maintenance Expenses. b. Debt service, if any, and any estimated Bond fund deposits.

2. A statement of estimated revenue from all sources other than Landing Fees, the BHS Fees, Loading Bridge Fees, and Terminal Building rentals for the succeeding Fiscal Year.

3. A schedule of all Capital Expenditure(s) for the Airport proposed to be undertaken by City during the succeeding Fiscal Year, as provided in Section 4.03.

4. A calculation of the Landing Fee, the BHS Fees, the Loading Bridge Fee, and the Terminal Building rental rates, calculated in accordance with Exhibit D to be effective from and after the beginning of the Fiscal Year for which the Airport Budget is adopted.

C. City Council retains the responsibility and is solely responsible for making all final decisions with respect to the Airport Budget.

Midyear Adjustments
If it appears to City during the course of any Fiscal Year, that the budgeted expenses or projected levels of airline activity City used to calculate the rents, fees, and charges set forth in the Rates and Fees Schedule are likely to vary by more than ten percent (10%) from actual results, City may make adjustments to such Item 1N - Page 55
Section 6.04
Airport Use and Lease Agreement – Final Dated October 24, 2022 46 rents, fees, and charges at midyear. City shall provide Airline with at least thirty (30) days' advance written notice of any adjustments to be made under this paragraph, which shall include accompanying budget variances and calculations to demonstrate the need for adjustment and resulting change in rates, fees, and charges. Any such mid-year adjustment will be effective the first day of the month following the notification period.

Settlement
As soon as possible following the completion of the City’s annual independent financial audit, City shall furnish Airline with an accounting of the costs and expenses actually incurred, actual allocations for direct and indirect expenses, revenues and other credits actually realized (reconciled to the annual independent financial audit of the City), and actual Enplaned Passengers and Landed Weight during such Fiscal Year with respect to each of the components of the calculation of the various rates, fees, and charges identified in Exhibit D and shall recalculate the rates, fees, and charges required for the Fiscal Year based on those actual costs and revenues.

In the event that Airline’s rentals, fees, and charges billed and paid during the prior Fiscal Year were more than the amount of Airline’s rentals, fees, and charges required (as recalculated based on actual costs and revenues), such excess amount shall be paid in a lump sum by City to Airline within sixty (60) days of the calculation of such final settlement.

In the event that Airline’s rentals, fees, and charges billed and paid during the prior Fiscal Year were less than the amount of Airline’s rentals, fees, and charges required (as recalculated based on actual costs and revenues), such deficiency shall be billed to Airline and payable by Airline within sixty (60) days of the date of invoice.

Airport Revenue Sharing.

Beginning with Fiscal Year 2024 and continuing for each Fiscal Year Item 1N - Page 56
Section 6.05
Section 6.06
Airport Use and Lease Agreement – Final Dated October 24, 2022 47 thereafter, in conjunction with calculation of Settlement described in Section 6.05, City will share with the Signatory Airlines a portion of Net Remaining Airport Revenues calculated in accordance with Exhibit D. The Signatory Airlines’ percentage of Revenue Sharing on Net Remaining Airport Revenues will be as follows: Fiscal Year 2024 - Sixty-Five percent (65%); Fiscal Year 2025 - Fifty-Five percent (55%); Fiscal Year 2026 – Forty-Five (45%); Fiscal Year 2027 - Thirty-Five percent (35%): and Fiscal Year 2028 – Thirty-Five percent (35%). Should this Agreement be extended in accordance with Section 2.02, the Signatory Airlines’ percentage of Revenue Sharing on Net Remaining Airport Revenues will be ThirtyFive percent (35%).

Airline’s portion of the Revenue Sharing on Net Remaining Airport Revenues shall be an amount equal to the Airline’s proportionate share of total Signatory Airlines’ Total Enplaned Passengers during a Fiscal Year. City shall prepare statements of adjusted rates for rentals, fees, and charges with the calculation of Revenue Sharing included and transmit the same to Airline for the Fiscal Year for which Airport Revenue Sharing has been calculated. Within sixty (60) days of the calculation of such Fiscal Year Settlement, City shall remit a lump sum payment representing Airline’s proportionate share of such Revenue Sharing.

Incorporation of Exhibit D.

Adjustments to rates for rentals, fees, and charges but not the methodology of calculating them shall apply without the necessity of formal amendment of this Agreement. Upon each adjustment pursuant to this Article 6, a revised Exhibit D1 and D-2, showing the calculation of Landing Fee, the BHS Fee, the Loading Bridge Fee, and the Terminal Building rental rates for the applicable Fiscal Year shall be prepared by the City and submitted to Airline. Said exhibit shall then be deemed part of this Agreement without formal amendment thereto.

Item 1N - Page 57
Section 6.07
Airport Use and Lease Agreement – Final Dated October 24, 2022 48

MAINTENANCE, REPAIR, ALTERATIONS AND IMPROVEMENTS
Designation of Maintenance and Operation Responsibilities In addition to the obligations of Airline and City set forth in this Article 7, responsibilities for maintenance, cleaning, and operation of the Airport shall be as set forth in Exhibit E, attached hereto and made a part hereof.

Airline’s Responsibilities
It is understood and agreed that Airline and City shall have the following maintenance and repair obligations:

A. Airline agrees that by commencing occupancy of all Exclusive Use Space and Preferential Use Space assigned to it pursuant to this Agreement, Airline is representing that such space is in good and tenantable condition.

B. Airline shall at its sole expense and in a manner acceptable to the Executive Director:

1. Maintain its Exclusive Use Space in a neat, sanitary, safe, clean, presentable, and orderly condition.

2. Maintain its Preferential Use Space in a neat, clean and orderly condition, free from litter, debris, refuse, petroleum products or grease which result from the activities of its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, or suppliers; including the removal of all oil and grease spillage that is attributable to Airline’s aircraft or equipment.

3. Perform ordinary preventive maintenance and upkeep and nonstructural repair of all facilities located in Exclusive Use Space that is not in Public View.

Item 1N - Page 58
Article 7.

Section 7.01
Section 7.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 49

4. Immediately repair any damage in any other space at the Airport caused by Airline, its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, or suppliers.

C. After written notice and an opportunity for Airline to cure, City may, at the sole discretion of the Executive Director, provide any or all of the above delineated maintenance and repair obligations that are not timely performed by Airline and recover its entire cost plus an administrative charge equivalent to no more than fifteen percent (15%) of the entire cost from Airline as Additional Charges.

City’s Responsibilities
A. City, during the term of this Agreement, shall retain FAA Airport Certification in accordance with 14 CFR Part 139 and keep the Airport in reasonably good repair.

B. City shall equip, furnish, and decorate the areas in Public View of the Terminal Building except for Airline baggage service offices.

C. City shall provide and supply to Airline’s Exclusive Use Space heat, electricity, air conditioning, wastewater disposal, water, pest control and access to trash and recycling receptacles. Interruptions of services shall not constitute a Default by City or an Event of Default hereunder, but City shall use its best efforts to restore such service after interruption.

D. City shall provide and supply to the areas in Public View of the Terminal Building heat, electricity, light, air conditioning, wastewater disposal, water, and janitorial services, including trash removal and recycling receptacles.

Interruptions of services shall not constitute a breach of this Agreement by City, but City shall use its best efforts to restore such service after interruption.

E. The undertakings by City under this Section 7.03 do not relieve Airline Item 1N - Page 59
Section 7.03
Airport Use and Lease Agreement – Final Dated October 24, 2022 50 of its duties to maintain all Airline Premises (as set forth in this Agreement, including Exhibit E) and to use Joint Use Space with due care.

City’s Right to Inspect and Make Repairs
City, by its officers, employees, agents, contractors, subcontractors and other representatives, shall have the right, at such times as may be reasonable under the circumstances, and after reasonable notice (except in the case of an emergency) to enter Airline’s Exclusive Use Space, Preferential Use Space and Joint Use Space for the following purposes:

A. To inspect such space to determine whether Airline has complied and is complying with the terms and conditions of this Agreement.

B. To exercise its governmental functions relating to the public health, safety, good conduct and the proper management of the Airport.

C. To accomplish repairs or replacements by City required of City by Section 7.03, or in any case where Airline is obligated to make repairs or replacements and has failed to do so, after reasonable notice, make such repairs or replacements on Airline’s behalf.

D. In the exercise of City’s right to inspect, no such entry by or on behalf of City upon any Exclusive Use Space, Preferential Use Space and Joint Use Space leased to Airline shall be deemed to constitute an interference with the possession and quiet enjoyment thereof by Airline.

Alterations and Improvements
A. No improvements, alterations or additions including, but not limited to, repainting, redecorating, and re-carpeting shall be made in or about Airline’s Exclusive Use and Preferential Use Space by Airline without first obtaining written consent of City. All such improvements, structure, alterations, additions and work shall be in full accordance with all written conditions prescribed by the City. Prior to the construction of any improvements, Airline shall submit to City for review and Item 1N - Page 60
Section 7.04
Section 7.05
Airport Use and Lease Agreement – Final Dated October 24, 2022 51 approval, the plans of such improvements, including the color of all paint and carpet. Such plans shall conform to the general architectural scheme and overall plans adopted by the City for the Terminal Building.

B. Upon approval by the City of Airline’s plans as required in Section

7.05A, Airline shall cause the construction called for by said plans to be commenced and completed with reasonable dispatch. Upon completion of any improvement, Airline shall furnish to City, at no charge, a complete set of working drawings of the improvement as constructed in a form and manner required by City.

C. All improvements, alterations, or additions constructed by Airline in the Airline’s Premises, including the plans and specification therefor, shall conform in all respects to the applicable statutes, ordinances, building code, rules and regulations of the City of Palm Springs and such other governmental authority as may have jurisdiction at the Airport. City’s approval, as provided for in this Section

7.05, shall not constitute a representation or warranty as to such conformity which shall remain Airline’s responsibility. Airline, at its own cost and expense, shall procure all permits necessary for such construction.

D. All renovation or construction by Airline pursuant to this Section 7.05 shall be at Airline’s sole cost and expense. Airline shall keep its Airline Premises, and the improvements constructed thereon, free and clear of all liens and shall pay all costs for labor and material arising out of such construction and shall hold City harmless from any liability in respect thereto. Airline shall have the right to contest any and all liens filed against its Airline Premises. Airline further agrees that City shall have the right to post notices of non-responsibility as provided by Sections 3094 and 3129 of the Civil Code of the State of California.

E. Airline shall make no structural alterations to the roof, walls, or floors of any permanent structures in which Airline’s Premises are located without first obtaining City’s written consent.

Item 1N - Page 61
Airport Use and Lease Agreement – Final Dated October 24, 2022 52 F. Any and all improvements, alterations, or additions erected or installed by Airline upon the Airline’s Premises shall become a part of the land on which they are erected and title thereto shall thereupon vest in City upon the expiration or sooner termination of this Agreement.

G. Airline shall be financially responsible for, and shall indemnify and hold City harmless from, damage to the Terminal Building caused by Airline, its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, or suppliers. In the event that Airline fails to timely repair any such damage, the City, after reasonable written notice to Airline, may repair such damage on Airline’s behalf, and the City may recover its entire cost plus a reasonable administrative charge (not to exceed fifteen percent (15%) of the entire cost) from Airline as Additional Charges.

H. Airline acknowledges Airline’s Premises are located within a public building and, as such, any improvements, alterations, or additions constructed by Airline may be subject to payment of prevailing wage under the provisions of the California Labor Code. To the extent any such work is subject to prevailing wage requirements, the following shall apply:

1. Airline shall and shall cause its contractors and subcontractors to pay prevailing wages in the construction of any such improvements, alterations or additions as those wages are determined pursuant to Labor Code Sections 1720 et seq.; to employ apprentices as required by Labor Code Sections 1777.5 et seq.; and comply with the other applicable provisions of Labor Code Sections 1720 et seq., 1725.5, 1771, 1771.1, 1771.4, 1776, 1777.5 et seq., 1810-1815 and the implementing regulations of the Department of Industrial Relations (the “DIR”) for all such Labor Code sections.

2. Airline shall indemnify, hold harmless and defend to the extent permitted by law, City, its councilmembers, commissioners, officials, employees, and agents, against any claim for damages, compensation, Item 1N - Page 62
Airport Use and Lease Agreement – Final Dated October 24, 2022 53 fines, penalties, or other amounts arising out of the failure or alleged failure of Airline, or its consultants, subconsultants, contractors or subcontractors to pay prevailing wages as determined pursuant to Labor Code Sections 1720 et seq., to hire apprentices in accordance with Labor Code Sections 1777.5 et seq., or to comply with the other applicable provisions of Labor Code Sections 1720 et seq., 1725.5, 1771, 1771.1, 1771.4, 1776, 1777.5 et seq., 1810-1815 and the implementing regulations of the DIR in connection with any improvements, alterations, or additions constructed by Airline. The provisions of this Section shall survive termination of this Agreement.

Item 1N - Page 63
Airport Use and Lease Agreement – Final Dated October 24, 2022 54

DAMAGE OR DESTRUCTION, INSURANCE, INDEMNIFICATION AND

RELEASE OF LIABILITY
Damage or Destruction
A. Should the Exclusive Use Space, Preferential Use Space or Joint Use Space, or any portions thereof, or buildings or structures of which such space may be a part, are damaged by fire or other casualty, City shall notify Airline whether the space shall be repaired as soon as practicable. If the space is to be repaired, it shall be repaired with due diligence by City, and the rental allocable to the particular building, rooms, or other portion of the space rendered untenantable, for the period from the occurrence of the damage to the Substantial Completion of the repairs, shall be abated, provided that, if the damage or destruction was caused by Airline’s acts or omissions, such rental shall not be abated. City shall use its commercially reasonable efforts to provide Airline with temporary, comparable, substitute space, if available, at rental rates not to exceed those set forth in Exhibit D, until such time as the repairs are substantially completed provided; however, that if the remaining space under this Agreement and any temporary, substitute space will not allow Airline to conduct its operations, Airline may terminate this Agreement upon at least seven (7) calendar days’ written notice to City.

B. The rentals payable hereunder with respect to Exclusive Use Space, Preferential Use Space or Joint Use Space shall be paid up to the time of such damage and shall thereafter be abated equitably in proportion as the part of the area rendered untenantable bears to total Airline Premises until such time as such affected Airline Premises shall be restored adequately for Airline's use; provided, however, that if this Agreement is terminated the rentals will be payable only to the date of said termination.

C. If City fails to notify Airline of its decision to repair within sixty (60) calendar days after the damage described above occurs, City shall be deemed to have elected not to repair the damage, and Airline may terminate the provisions of the Agreement as to the space damaged or destroyed only, and such termination Item 1N - Page 64
Article 8.

Section 8.01
Airport Use and Lease Agreement – Final Dated October 24, 2022 55 as to such space is to be effective as of the date of the damage.

Insurance
A. By use and occupancy of space on Airport Premises, Airline understands and agrees that it shall, at its expense purchase and maintain or cause to maintain in force the following insurance coverage for itself and its officers, agents, employees passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees and suppliers. Airline shall maintain in full force and effect the forms of insurance specified under this Section 8.02.

All such insurance hereunder shall be maintained with insurance underwriters who have a Best’s Key Rating Guide/Property-Casualty/United States or www.ambest.com or an equivalent financial strength rating from the S&P, Moody’s, or Fitch.

All liability insurance policies shall provide coverage which includes, or has the same substantive effect as, the following wording:

1. The City of Palm Springs, its governing Board and each of its officers, directors, officials, employees, and authorized agents and volunteers, (collectively, “City Additional Insureds”), in their respective capacities as such, shall be included as additional insureds hereunder as respects to liability caused, in whole or in part, by the acts or omissions of Airline, or the acts or omissions of those acting on behalf of Airline; or premises owned, occupied or used by Airline in conjunction with work or services provided by Airline to the extent of the named insured’s obligations under its Agreement with the City of Palm Springs.

Such required liability policy shall contain a Severability of Interest (Cross Liability) clause which states “It is agreed that the insurance afforded by these policies shall apply separately to each insured against whom a claim is made or a suit is brought with respect to the limits of the Airline’s liability.

Item 1N - Page 65
Section 8.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 56

2. It is agreed that this insurance policy shall apply as primary and any insurance or self-insurance as may be maintained by the City of Palm Springs, its governing Board, officers, directors, officials, employees, and authorized agents and volunteers shall apply in excess of and shall not contribute with insurance provided by this policy.

3. This insurance shall not be materially changed, altered, canceled or non-renewed until after thirty (30) days advance written notice has been given to the City of Palm Springs except that only ten (10) day notice shall be required in the event of cancellation due to non-payment of premium.

Prior to the effective date of this Agreement, Airline shall furnish City with evidence of all insurance policies. Prior to the expiration of any then-current policy of insurance, Airline shall deliver to City evidence showing that such insurance coverage has been renewed. At least five (5) calendar days prior to the date of cancellation or reduction of coverage, as received in the written notice from the insurer, Airline shall deliver to the Executive Director evidence showing reinstatement or other provision for the required insurance.

All such evidence shall be in the form of certificates of insurance reasonably satisfactory to the Executive Director, accompanied by a copy of an endorsement, if applicable, to each policy containing the language required by Section 8.02(A) and, if applicable, cross liability coverage shall be in the following amounts:

B. Aircraft liability insurance and comprehensive form airline liability or airport liability insurance, covering bodily injury, personal injury, property damage, products/completed operations liability, premise liability, and contractual liability specifying this Agreement, with a liability limit of not less than three hundred million dollars ($300,000,000) combined single limit per occurrence. Said limit shall be reduced to $150,000,000 where Airline’s maximum seating capacity on any Item 1N - Page 66
Airport Use and Lease Agreement – Final Dated October 24, 2022 57 airplane operated by Airline is thirty (30) or less. With respect to coverage for products/completed operations and personal injury, except with respect to passengers, a sublimit of not less than twenty five million dollars ($25,000,000) per occurrence, and in the annual aggregate, shall be permitted. Said aircraft liability shall be applicable to owned, non-owned, and hired aircraft.

C. Automobile liability insurance with a liability limit of not less than five million dollars ($5,000,000) for all owned, non-owned, and hired vehicles operated by or on behalf of Airline on the Airport, including any additional or replacement vehicles.

D. Liquor liability insurance for Airline serving alcoholic beverages in an amount not less than ten million dollars ($10,000,000) per occurrence.

E. Employer’s liability insurance in an amount not less than one million dollars ($1,000,000) per occurrence.

F. Airline shall likewise maintain workers’ compensation insurance or evidence of self-insurance, if applicable, in accordance with the laws of the State of California, covering all its employees who may from time to time be at the Airport in such capacity. Airline shall require each of its agents, licensees, subcontractors, and suppliers of the Airline Premises to maintain such workers’ compensation insurance covering their employees coming on the Airport in connection with Airline’s operations hereunder. The workers’ compensation policy(s) required hereunder shall be endorsed to state that the workers’ compensation carrier waives its right of subrogation against the City of Palm Springs, its governing Board, officers, directors, officials, employees, and authorized agents and volunteers. Upon request by the Executive Director, Airline shall furnish the Executive Director with a certificate of insurance of such workers’ compensation insurance in a form reasonably acceptable to City.

G. Environmental Impairment Liability insurance with a limit of not less than five million dollars ($5,000,000) including coverage for Third Party Pollution Item 1N - Page 67
Airport Use and Lease Agreement – Final Dated October 24, 2022 58 Liability, Remediation coverage, and offsite cleanup. Satisfaction of the requirement for Environmental Impairment Liability may be made by securing a policy of insurance for this coverage or providing to the City a letter on company letterhead stating that Airline is self-insured for this coverage. If a policy of insurance is secured to meet this insurance requirement, the City of Palm Springs, its governing Board, officers, directors, officials, employees, and authorized agents and volunteers (collectively, “City Additional Insureds”) shall be included as Additional Insureds.

H. The parties understand and agree that the minimum limits of the insurance herein required may become inadequate during the term of this Agreement, and Airline and City agree that each will increase such minimum limits by reasonable amounts on request of the Executive Director with concurrence of City Risk Manager.

I. If at any time Airline fails to obtain or maintain in force the insurance required herein, such failure shall constitute an incurable Default permitting City, at its option, to immediately terminate this Agreement and take possession upon giving the notice specified in Article 14, but without giving any prior notice of Default pursuant to Article 14, and City shall have all available remedies specified in Article 14 or permitted by law. Under this provisions, City does not have to wait until the expiration of the fifteen (15) day notice period as stated in Article 14, but upon providing written notification, can immediately take possession and terminate the Agreement.

J. If any claim for damages is filed with Airline or if any lawsuit is instituted against Airline, Airline shall give prompt and timely notice thereof to the Executive Director, provided that claims and lawsuits subject to such notice are only those that arise out of or are in any way connected with Airline’s or its officers’, representatives’, agents’, employees’, passengers’, guests’, patrons’, contractors’, subcontractors’', licensees’, subtenants’, invitees’, or suppliers’ use of the Airline Premises or Airline's operations or activities in regard to the Airport and that in any Item 1N - Page 68
Airport Use and Lease Agreement – Final Dated October 24, 2022 59 way, directly or indirectly, contingently or otherwise, affect or might reasonably affect City. Notice shall be deemed prompt and timely if given within thirty (30) calendar days following the date of receipt of a claim or ten (10) calendar days following the date of service of process of a lawsuit. Accident or property damage claims in an amount less than ten thousand dollars ($10,000) shall be excluded from the requirements of this Section 8.02(J).

K. If any claim for damages is filed with City or if any lawsuit is instituted against City, City shall give prompt and timely notice thereof to Airline, provided that claims and lawsuits subject to such notice are only those that arise out of or are in any way connected with the operation of the Airport by City and that in any way, directly or indirectly, contingently or otherwise, affect or might reasonably affect Airline. Notice shall be deemed prompt and timely if given within thirty (30) calendar days following the date of receipt of a claim or ten (10) calendar days following the date of service of process of a lawsuit. Accident or property damage claims in an amount less than ten thousand dollars ($10,000) shall be excluded from the requirements of this Section 8.02(K).

L. In the event Airline chooses to provide self-insurance in order to satisfy any requirements of this Section, self-insurance retentions must be declared to and approved by the City. The City may require the Airline to purchase coverage with a lower retention or provide proof of liability to pay losses and related investigations, claim administration, and defense expenses within the retention.

Any and all deductibles and SIRs shall be the sole responsibility of Airline and shall not apply to the City Additional Insureds.

Indemnification
To the fullest extent permitted by law, Airline shall indemnify, defend and hold harmless the City of Palm Springs, its governing Board, officers, directors, officials, employees, and authorized volunteers and agents, (collectively “Indemnified Parties”), from and against any and all claims, demands, actions, losses, liabilities, damages, and all expenses and costs incidental thereto Item 1N - Page 69
Section 8.03
Airport Use and Lease Agreement – Final Dated October 24, 2022 60 (collectively “Claims”), including cost of defense, settlement, arbitration, and reasonable attorneys’ fees, sustained by any person or to any property in, on, or about the Airport, or Airline Premises used or occupied by Airline for Airline’s operations or activities resulting from injuries to or death of persons, including but not limited to employees of either party hereto, and damage to or destruction of property or loss of use thereof, including but not limited to the property of either party hereto, arising out of, pertaining to, or resulting from the acts or omissions of the Airline, its officers, directors, officials, employees, volunteers, agents, representatives, contractors, subcontractors invitees, passengers, guests, subtenants and suppliers, excepting only such injury, death or damage to the extent it is caused by the negligence of one or more of the Indemnified Parties.

Airline shall not be liable for any Claims arising from the sole negligence or willful misconduct of one or more of the Indemnified Parties where such indemnification would be invalid under Section 2782 of the Civil Code
This indemnity shall not be limited by the types and amounts of insurance or self-insurance maintained by the Airline.

Nothing in this Indemnity shall be construed to create any duty to, any standard of care with reference to, or any liability or obligation, contractual or otherwise, to any third party.

The provisions of this indemnity shall survive the termination or expiration of this Agreement.

Release of Liability Regarding Certain Damages
A. City shall not be liable for, and is hereby released from, all liability to Airline, Airline’s insurance carrier, or anyone claiming under or through Airline for bodily injury or any loss or damage to real or personal property occasioned by flood, fire, earthquake, lightning, windstorm, hail, explosion, terrorism, riot, strike, civil commotion, military confrontation, smoke, vandalism, malicious mischief, acts of civil disobedience, acts of civil authority, forfeiture, or any other cause beyond City’s Item 1N - Page 70
Section 8.04
Airport Use and Lease Agreement – Final Dated October 24, 2022 61 control.

B. City shall not be liable for, and is hereby released from all liability to Airline, Airline’s insurance carrier, or anyone claiming under or through Airline for any loss or damage whatsoever to the property or effects of Airline resulting from the discharge of water or other substances from pipes, sprinklers, or conduits, containers or appurtenances thereof or fixtures thereto, or for any damage resulting from the discharge or failure of electric current, regardless of cause or origin, except for such damage as may be caused by reason of the negligence of City, its employees or agents.

Item 1N - Page 71
Airport Use and Lease Agreement – Final Dated October 24, 2022 62

ENVIRONMENTAL COMPLIANCE
Definitions
The following definitions shall apply as used in this Article:

A. “Environmental Laws” shall mean all present and future federal, state, and local statutes, regulations, ordinances, permits, codes, orders, limitations, restrictions, or prohibitions of any governmental authority, including City codes and orders, relative to the occupancy and use of the Airline Premises, the Airport and Airfield Area regarding the environment, including, without limitation, Pollutants, wetlands, waters of the United States, areas inhabited by Endangered, Threatened, or Sensitive Species, the protection of the environment, public health, welfare or safety, including, without limitation, those related to Pollutants (as such terms are defined herein).

B. “Endangered, Threatened and Sensitive Species” shall mean any flora or fauna identified by the provisions of the California Endangered Species Act (California Fish and Game Code §2050, et seq.), the Federal Endangered Species Act (16 U.S.C. §§1531-1543), and the Federal Migratory Bird Treaty Act (16 U.S.C. §§703-712) on the Airport.

C. “Hazardous Material” shall mean any substance whether solid, liquid, or gaseous in nature:

1. the presence of which requires investigation or remediation under any federal, state or local statute, regulation, ordinance, order or common law; or

2. which is or becomes defined as a hazardous waste, hazardous substance, pollutant or contaminant under any federal, state, or local statute, regulation, rule, or ordinance, or amendments thereto, including, without limitation, the following: (a) Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. §§9601-9675); (b) Item 1N - Page 72
Article 9.

Section 9.01
Airport Use and Lease Agreement – Final Dated October 24, 2022 63 Resource Conservation and Recovery Act (42 U.S.C. §§6901-6992); (c) Clean Air Act (42 U.S.C. §§7401-7642); (d) Clean Water Act (33 U.S.C. §§1251-1387); (e) state and federal regulations relating to storm water discharges, including without limitation, 40 CFR Part 122; or

3. the presence of which on the Airport causes or threatens to cause a nuisance upon the Airport or to adjacent properties or poses or threatens to pose a hazard to the health or safety of persons on or about the Airport; or

4. without limitation, which contains gasoline, diesel fuel, other petroleum hydrocarbons, natural gas, liquids, polychlorinated biphenyls (PCBs), asbestos, or lead-based paint; or

5. defined as a “Hazardous Waste” or “Extremely Hazardous Waste” or “Restricted Hazardous Waste” under Sections 25115, 15117 or 25122.7 or listed pursuant to Section 25140 of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law); or

6. defined as a “Hazardous Substance” under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.8 (CarpenterPresley-Tanner Hazardous Substance Account Act); or

7. defined as a “Hazardous Materials” or “Hazardous Substance” or “Hazardous Waste” under Section 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory); or

8. defined as a “Hazardous Substance” under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances); or

9. including petroleum; or
Item 1N - Page 73
Airport Use and Lease Agreement – Final Dated October 24, 2022 64

10. including asbestos; or

11. listed under this Article 9 or defined as “Hazardous Wastes” or “Extremely Hazardous” pursuant to Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20; or

12. designated as a “Hazardous Waste” pursuant to Section 311 of the Federal Water Pollution Control Act (33 U.S.C. Section 1317); or

13. defined as a “Hazardous Waste” pursuant to Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. (42 U.S.C. Section 6903); or

14. defined as a “Hazardous Substance” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq. (42 U.S.C. Section 9601).

D. “Process Water” shall mean water which contains Hazardous Material or Solid Waste from any point or non-point source subject to the Clean Water Act, amendments thereto, and regulations promulgated pursuant thereto, including without limitation, requirements of the National Pollution Discharge Elimination System Program and the State of California Porter-Cologne Water Quality Control Act.

E. “Pollutants” shall mean Hazardous Materials, Solid Wastes, and Process Waters (as such terms are defined herein).

F. “Release” shall mean any depositing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment, regardless of intent.

G. “Solid Waste” shall have the same meaning as in the Resource Conservation and Recovery Act and shall include sewage.

Item 1N - Page 74
Airport Use and Lease Agreement – Final Dated October 24, 2022 65 Duty to Comply with Environmental Laws
Airline shall, relative to its occupancy and use of the Airline Premises, the Airport, and the Airfield Area, comply with all Environmental Laws.

Liability and Responsibility for Corrective Action
Airline shall be liable and responsible for any Release of Pollutants arising out of the Airline’s occupancy or use of the Airline Premises, or Airport, or Airfield Area, which is caused by Airline, or its employees, agents, representatives, or Affiliates (hereinafter “Airline Release”). Liability and responsibility for such Airline Releases shall include, but not be limited to:

A. all immediate actions reasonably necessary under Environment Laws to promptly control any such Airline Release and to mitigate any immediate threat to public health, safety, and the environment resulting from such Airline Release; B. any further repairs or corrective actions, conducted in a timely manner, reasonably necessary under Environmental Laws to remediate the Airline Release and to protect public health, safety, and the environment, and to bring the affected areas on or outside the Airline Premises, or Airport, or Airfield Area into compliance with Environmental Laws and other applicable regulatory requirements; C. damages to persons, property and the Airline Premises, or Airport, or Airfield Area resulting from such Airline Release;
D. all claims resulting from those damages;
E. fines imposed by any governmental agency to the Airline Release, and F. any other liability as provided by law.

If Airline causes, or permits the use or storage of Hazardous Materials resulting in a release of Pollutants on the Airport, then Airline shall indemnify, defend and hold harmless City, its governing Board, officers, directors, officials, Item 1N - Page 75
Section 9.02
Section 9.03
Airport Use and Lease Agreement – Final Dated October 24, 2022 66 employees, and authorized volunteers and agents, (collectively “Indemnified Parties”) from and against, any and all claims, demands, actions, judgments, damages, penalties, fines, costs, liabilities or losses, and all expenses and costs incidental thereto (collectively “Claims”) including cost of defense, settlement, arbitration and reasonable attorneys’ fees, which arise during or after the term of this Agreement as a result of such a Release of Pollutants . This indemnification of City by Airline includes, without limitation, costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any Federal, State or local governmental agency or political subdivision because of Hazardous Material present in the soil or ground water on or under the Airport, excepting pre-existing conditions. Without limiting the foregoing, if the presence of any Hazardous Material caused or permitted by Airline results in any Release of Pollutants, Airline shall promptly take all actions at its sole expense as are necessary to render the Airport in compliance with all Environmental Laws; provided that City’s approval of such actions shall first be obtained, which approval shall not be unreasonably conditioned, delayed, or withheld so long as such actions would not potentially have any material adverse long-term or short-term effect on the Airport. City shall have a direct right of action against Airline to enforce this provision.

Right to Inspect and Test
The City, or its designated representatives, may at any time during the term of this Agreement enter upon the Airline Premises and make any inspections, assessments, investigations, audits, tests or measurements City deems reasonably necessary, including boring into surfaces or the ground, in order to determine if a Release of Pollutants has occurred. City shall give Airline a minimum of forty-eight (48) hours’ notice in writing prior to conducting any inspections or tests, unless, in City’s reasonable judgment, based on significant release of hazardous materials or other emergency situation, circumstances require otherwise, and such tests shall be conducted in a manner so as to minimize any inconvenience and disruption to Airline's operations. If such tests indicate a Item 1N - Page 76
Section 9.04
Airport Use and Lease Agreement – Final Dated October 24, 2022 67 Release has occurred, then City will confer with the airline to determine the party responsible for such Release. If the Airline is determined to be the responsible party the City may require Airline, at Airline's expense, to have tests for such Pollutants conducted by a qualified party or parties on the Airline Premises, or Airport, or Airfield Area, as required by Environmental Law. If Pollutants that originated from an Airline Release have impacted any area outside the Airline Premises, including but not limited to surface, subsurface, surface water, and groundwater, then City, at City’s reasonable discretion, may require Airline, at Airline’s expense, to have tests for such Pollutants conducted by a qualified party or parties on said area outside the Airline Premises, or Airport, or Airfield Area as required by Environmental Laws.

Duty to Furnish Information
At the reasonable written request of the City in advance, Airline shall make available for inspection and copying any or all non-privileged substantive documents and materials that Airline possesses associated with Airline’s operations at or occupancy or use of the Airline Premises, or Airport, or Airfield Area by Airline, including without limitation any and all associated records, test results, studies or other documentation regarding environmental conditions relating to Airline’s use, storage, or treatment of any Hazardous Materials or Solid Wastes or Process Waters.

Immediately upon receipt by Airline (and in no event later than five (5) business days after receipt), Airline shall provide the City with copies of any notice or other document issued to Airline (or any employee, agent, contractor, sublessee, or any other third party under Airline’s direction or control) by any governmental agency alleging non-compliance or investigating potential noncompliance with any Environmental Laws (i) arising out of the occupancy or use of the Airline Premises, or Airport, or Airfield Area by Airline, or (ii) at the Airport and alleged to have arisen in whole or in part from Airline operations, activities, actions or omissions of Airline or third parties under Airline’s direction or control.

Item 1N - Page 77
Section 9.05
Airport Use and Lease Agreement – Final Dated October 24, 2022 68 At the request of the City (but in no event more than thirty (30) days after such request), the Airline shall provide the results of any tests conducted by Airline or Airline’s qualified party at the Airline Premises, the Airport or Airfield Area, including but not be limited to, comprehensive soil, emission, material, Process Water, surface water or groundwater sampling and testing or other procedures to determine any actual or possible Release of Pollutants.

Airline shall report such known or identified Releases to City within seventytwo (72) hours. If (i) such Releases are determined to be an Airline Release, and (ii) necessary to determine compliance with Environmental Laws, Airline shall diligently proceed to identify the horizontal and vertical extent of the Release, how it will be controlled or mitigated or remediated as required by Environmental Law(s), when and by whom it will be controlled or mitigated or remediated, and the cost of such corrective actions. By way of clarification, the above requirements shall not apply to the extent that a Release of Pollutants.

If Airline provides privileged or confidential materials to City, City agrees to not disclose such materials unless required by law. To the extent that the Airline is subject to disclosure requirements under the California Public Records Act (Govt.

Code § 6250 – 6276.48) or other federal, state, and local public record laws (collectively, “the Disclosure Laws”), the following additional terms apply:

In the event the City receives a request for disclosure of such information or disclosure under the Disclosure Laws, then City will provide Airline with reasonable prior notice, and in no case less than ten (10) days’ notice, of the request prior to disclosing the information or documentation. If Airline claims the information or documentation is exempt from disclosure under the Disclosure Laws, it must obtain a protective order, injunctive order, or other appropriate remedy from a California court of law before the City’s deadline for responding to the request. If Airline fails to obtain such judicial relief within that time, the City may disclose the requested information without any penalty or liability to Airline.

Item 1N - Page 78
Airport Use and Lease Agreement – Final Dated October 24, 2022 69 Term of Environmental Provisions
The provisions of this Article, including the representations, warranties, covenants and indemnities of Airline, shall expressly survive termination of this Agreement and Airline’s obligations and liabilities under this Article shall continue so long as City bears any liability or responsibility under the Environmental Laws arising from Airline’s occupancy or use of the Airline Premises, or Airport, or Airfield Area during the term of this Agreement.

Sustainability
Airline shall, relative to its occupancy and use of the Airline Premises, the Airport, and the Airfield Area, comply with all Environmental Laws, and where appropriate, will work collaboratively with the City to help meet the City’s sustainability initiatives.

Item 1N - Page 79
Section 9.06
Section 9.07
Airport Use and Lease Agreement – Final Dated October 24, 2022 70

ASSIGNMENT, SUBLEASE, REASSIGNMENT, MERGER,

BANKRUPTCY
Assignment and Sublease
Airline shall not at any time sublet, assign, transfer, convey, mortgage, pledge, or encumber its interest under this Agreement, or any part of the leased space, to any party other than a wholly owned subsidiary of Airline, to any Airline Transportation Company under the same control as the parent company of Airline, or corporation with which Airline may merge or consolidate, without prior written approval of the City. Any such attempt to sublet, assign, or transfer in violation of the provisions hereof shall be null and void and considered a Default hereunder.

No sublease, assignment, transfer, conveyance, mortgage, pledge or encumbrance by Airline shall relieve Airline of its primary responsibility for all payments and performance of all other obligations required of Airline by this Agreement. Consent by City to any type of sublease, assignment, transfer, conveyance, mortgage, pledge or encumbrance shall not in any way be construed to relieve Airline from obtaining further consent for any subsequent sublease, assignment, transfer, conveyance, mortgage, pledge or encumbrance of any nature whatsoever.

Remedies Under Federal Bankruptcy Laws
Notwithstanding the foregoing, upon the filing by or against Airline of any proceeding under Federal bankruptcy laws, if Airline has defaulted in the performance of any provision of this Agreement within the six (6) months preceding such filing, City shall have the right to cancel this Agreement, in addition to other remedies provided under provisions of the Federal Bankruptcy Rules and Regulations and Federal Judgeship Act of 1984, as such may be subsequently amended, supplemented, or replaced. Such cancellation shall be by written notice to Airline within sixty (60) days from the date of Airline’s initial filing in bankruptcy court.

Item 1N - Page 80
Article 10.

Section 10.01
Section 10.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 71

CONDEMNATION
A. In the event the entire Airline Premises shall be appropriated or taken under the power of eminent domain by any public or quasi-public authority, this Agreement shall terminate and expire as of the date of such taking, and City and Airline shall each thereupon be released from any liability thereafter accruing hereunder.

B. In the event more than twenty percent (20%) of the square footage of the Airline Premises is taken under the power of eminent domain by any public or quasi-public authority, or if by reason of any appropriation or taking, regardless of the amount so taken, the remainder of the Airline Premises is not useable for Air Transportation, either City or Airline shall have the right to terminate this Agreement as of the date Airline is required to vacate a portion of the Airline Premises, upon giving notice in writing of such election within thirty (30) days after receipt by Airline from City of written notice that said Airline Premises have been so appropriated or taken. City agrees immediately after learning of any appropriation or taking to give to Airline notice in writing thereof.

C. If this Agreement is terminated in either manner herein above provided, City shall be entitled to the entire award or compensation in such proceedings. Airline’s right to receive compensation or damages for its fixtures and personal property shall not be affected in any manner hereby.

D. If both City and Airline elect not to so terminate this Agreement, or if neither has the right to so terminate this Agreement following any such taking, then in either such event City agrees, at City’s cost and expense, to the extent of any severance damages attributable to damages to the Airline Premises available to City, to as soon as reasonably possible restore the Airline Premises on the land remaining to a complete unit of like quality and character as existed prior to such appropriation or taking.

E. For the purposes of this Section, a voluntary sale or conveyance in lieu Item 1N - Page 81
Article 11.

Airport Use and Lease Agreement – Final Dated October 24, 2022 72 of condemnation shall be deemed an appropriation or taking under the power of eminent domain. Airline hereby waives any statutory rights of termination which may arise by reason of any partial taking of the Airline Premises under the power of eminent domain.

Item 1N - Page 82
Airport Use and Lease Agreement – Final Dated October 24, 2022 73

RULES AND REGULATIONS, COMPLIANCE WITH LAW,

NONDISCRIMINATION
Covenant Against Discrimination.

A. In connection with its performance under this Agreement, Airline agrees to comply with pertinent statutes, Executive Orders and such rules as are promulgated to ensure that no person shall, because of actual or perceived race, religion, color, sex, age, marital status, ancestry, national origin ( i.e., place of origin, immigration status, cultural or linguistic characteristics, or ethnicity), sexual orientation, gender identity, gender expression, physical or mental disability, or medical condition (each a “prohibited basis”), be excluded from participating in any activity conducted with or benefiting from Federal assistance. If Airline transfers its obligation to another, the transferee is obligated in the same manner as the Airline.

This provision obligates the Airline for the period during which the Airline, or its successor, operates at the Airport and the City remains obligated to the Federal Aviation Administration. This provision is in addition to that required by Title VI of the Civil Rights Act of 1964.

B. Airline shall ensure that applicants are employed, and that employees are treated during their employment, without regard to any prohibited basis. As a condition precedent to City’s lawful capacity to enter this Agreement, and in executing this Agreement, Airline certifies that its actions and omissions hereunder shall not incorporate any discrimination arising from or related to any prohibited basis in any Airline activity, including but not limited to the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship; and further, that Airline is in full compliance with the provisions of Palm Springs Municipal Code Section 7.09.040, including without limitation the provision of benefits, relating to non-discrimination in City contracting.

C. Airline further represents and warrants to City that as a condition of the use of Airport services and facilities, Airline shall comply with all applicable Item 1N - Page 83
Article 12.

Section 12.01
Airport Use and Lease Agreement – Final Dated October 24, 2022 74 provisions of the Federal Nondiscrimination requirements set forth in Exhibit H.

Airport Rules and Regulations
A. City, in its governmental capacity, has adopted and will enforce the Airport Rules and Regulations which are the laws, rules, regulations, policies, and other written guidance documents respecting the occupancy and use of the Airport, its services, and facilities by persons, vehicles, aircraft, and equipment that in the City’s opinion will reasonably ensure the safe, efficient, and economically practicable operation of the Airport and provide for the safety and convenience of those using the Airport, and to protect the Airport and its facilities and the public from damage or injury resulting from operations on, into, and from the Airport.

B. Airline shall observe and obey all Airport Rules and Regulations. City agrees that its Airport Rules and Regulations shall not be inconsistent with the express terms of this Agreement or any law, regulation or directive of the FAA or of any other federal or State agency. Copies of the Airport Rules and Regulations, as promulgated, shall be made available to Airline’s local manager by the Executive Director. City shall provide Airline with reasonable notice prior to adoption of any new or amended Rules or Regulations in order to provide Airline with the opportunity to comment on same prior to adoption. Airline, upon written request to the Executive Director, shall be furnished (at the notice address provided herein and to Airline's on-Airport manager) a current version of any such Airport rules or regulations and any amendments thereto.

C. Airline shall take all reasonably necessary steps to ensure that its officers, agents, employees, representatives, contractors, subcontractors, licensees or invitees fully comply with all Airport Rules and Regulations.

D. City shall prescribe penalties and injunctive remedies for violations of the Airport Rules and Regulations, and these penalties and injunctive remedies may be applied by the Executive Director to Airline for violations by any of Airline's officers, representatives, agents, employees, passengers, guests, patrons, Item 1N - Page 84
Section 12.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 75 contractors, subcontractors, licensees, subtenants, invitees, or suppliers.

Compliance with Law
Airline shall not, in connection with any of its activities or operations, use any of the Airport’s facilities or permit the same to be used by any of its officers, representatives, agents, employees, contractors, subcontractors, licensees, subtenants, invitees, or suppliers for any illegal purpose and shall:

A. Comply with all applicable ordinances, laws, and rules and regulations of any city, City, state, federal government or agency that has jurisdiction to pass laws or ordinances or to make and enforce rules and regulations governing conduct on and operations at the Airport and the use of its facilities.

B. Strictly comply with existing or future Department of Homeland Security – TSA rules, regulations or requirements, including but not limited to the TSA approved Airport Security Program, 49 CFR Part 1542, directives issued by the Executive Director relating to Airport security, or other regulations concerning Airport security
C. Make, at its own expense, all nonstructural improvements, repairs and alterations to its Exclusive Use Space, Preferential Use Space, equipment, and personal property that are required to comply with or conform to any of such laws, ordinances, and the rules and regulations referred to in Section 12.02.

D. Reimburse City for a pro rata portion of all nonstructural improvements, repairs and alterations that are required to comply with or conform to any of such laws, ordinances and rules and regulations referred to in Section

12.02. E. Be and remain an independent contractor with respect to all installations, construction and services performed hereunder by or at the request of City.

Item 1N - Page 85
Section 12.03
Airport Use and Lease Agreement – Final Dated October 24, 2022 76 Amendment Required by FAA
This Agreement may be amended without further consideration for the purpose of complying with FAA requirements.

Assurances Required By FAA
Airline will, at all times during this Agreement, comply with the applicable provisions of the FAA’s “Airport Sponsor Assurances” (Assurances) and any subsequent revisions, updates, or amendments thereto. City is not responsible for notifying Airline of any changes to the Assurances. Airline is required to contact the FAA for any updates or revisions. The Airline shall include compliance with these Assurances in all other agreements it enters into with third parties, pertaining to, referencing or otherwise related to activities regarding the Airline Premises. The Assurances document is available on the FAA’s website.
14 CFR Part 382 Boarding Assistance for Aircraft Compliance Airline, when required by 14 CFR Part 382 or any other laws, rules or applicable regulations now or hereafter adopted by federal or state governments, shall provide certain facilities for the movement of passengers with disabilities while enplaning and deplaning its aircraft. To the extent required by law, Airline shall be responsible for acquiring or making arrangements for the use of boarding assistance devices, when applicable, for its aircraft. Airline shall ensure that all lifts and other accessibility equipment used by it are maintained in proper working condition. Airline shall ensure that those personnel involved in providing boarding assistance through the use of lifts or other accessibility equipment are properly trained in the use and operation of the devices and appropriate boarding assistance procedures that safeguard the safety and dignity of passengers.

Airline shall have the right, on a non-exclusive, non-preferential basis with other authorized users thereof, to provide such assistance by utilizing any Cityowned passenger loading ramp in conjunction with its Air Transportation Business at the Airport. Airline shall be solely responsible for providing the personnel Item 1N - Page 86
Section 12.04
Section 12.05
Section 12.06
Airport Use and Lease Agreement – Final Dated October 24, 2022 77 necessary to operate the apparatus. Airline’s personnel shall operate such Cityowned apparatus in conformance with all written operating instructions and recommendations promulgated by the manufacturer of the apparatus and shall store the apparatus in a parking location approved by the City. The City shall be responsible for the maintenance and repair of any City-owned apparatus; provided however: (a) City may include the costs associated with such maintenance and repair in the Airfield Cost Center; and (b) Airline shall be obligated to reimburse City for the cost of all repairs necessitated by Airline’s negligent operation of the apparatus, or operation of the apparatus by the Airline contrary to manufacturer’s written instructions and recommendations. Airline shall hold City and its employees and officers harmless from, and indemnify against, any claims for personal injury, property damage, or consequential losses, subject to policy terms, conditions, limitations and exclusions, that might be brought by Airline, and of Airline’s officers, directors, agents, representatives, or employees, or by any third party whomsoever, stemming from the Airline’s use or operation of the apparatus; provided, however, that Airline shall not be obligated to hold City, its employees, and officers harmless from, or to indemnify against, any claim based upon the City’s, its employee’s officers, contractors or another Air Transportation Company’s negligence or negligent maintenance or repair of the apparatus.

Item 1N - Page 87
Airport Use and Lease Agreement – Final Dated October 24, 2022 78

AGREEMENT TO NOT GRANT MORE FAVORABLE TERMS
Agreement To Not Grant More Favorable Terms
A. City covenants and agrees not to enter into any lease, contract or any other agreement with any other Air Transportation Company containing substantially more favorable terms than this Agreement, or grant to any tenant engaged in an Air Transportation Business, rights or privileges with respect to the Airport that are not accorded Airline hereunder, unless the same rights, terms and privileges are concurrently made available to Airline B. If any other Air Transportation Company shall undertake any operations at the Airport for the carriage of passengers, baggage, cargo or mail by air, City shall require, such other aircraft operator to execute and deliver an agreement, permit, license, lease or contract with City providing for the same terms as Airline’s Agreement and also for rates, charges and fees substantially similar as City charges Airline including, but not limited to:

1. The payment of Landing Fees at rates and on such other terms and conditions as are not less burdensome on the other Air Transportation Company than those rates or terms and conditions then in effect for Airline.

2. The payment of rentals for aircraft parking and the use of City equipment and for any space leased from City in the Terminal Building at rates not less than those rental rates then payable by Airline for similar facilities.

3. The payment for use by such other Air Transportation Company of all Joint Use Space and operating costs of all baggage handling or other passenger service systems, calculated and billed to such entity as in the case of Airline.

Item 1N - Page 88
Article 13.

Section 13.01
Airport Use and Lease Agreement – Final Dated October 24, 2022 79

DEFAULT AND TERMINATION
Airlines Default and Default Notices
A. The following shall be “Events of Default” under this Agreement constituting a material breach of the Agreement and the terms “Events of Default” and “Default” shall mean, whenever they are used in this Agreement, any one of the following events:

1. If the rentals and fees, Passenger Facility Charge proceeds or reports required pursuant to 14 CFR Part 158, or other money payments that Airline herein agrees to pay, or any part hereof, shall be unpaid on the date the same becomes due and not cured in accordance with Section 5.10.

2. If Airline files a voluntary petition in bankruptcy, or makes a general assignment for the benefit of creditors, or if Airline is adjudicated as bankrupt.

3. The taking of jurisdiction of Airline or its assets by a court of competent jurisdiction pursuant to proceedings brought under the provisions of any federal reorganization act, or forfeiture.

4. The appointment of a receiver or a trustee of Airline’s assets by a court of competent jurisdiction or a voluntary agreement with Airline’s creditors, and the same is not removed within ninety (90) calendar days from the date of such appointment.

5. If a custodian is appointed for or takes possession of Airline’s property, other than a trustee receiver or agent who is appointed or authorized to take charge of less than substantially all of Airline’s property for the purpose of enforcing a lien against such property. For this purpose, “custodian” means one of the following:
a. A receiver or trustee of any of Airline’s property, appointed in Item 1N - Page 89
Article 14.

Section 14.01
Airport Use and Lease Agreement – Final Dated October 24, 2022 80 any case or proceeding other than a case or proceeding under the federal Bankruptcy Code, as amended.
b. An assignee under a general assignment for the benefit of Airline’s creditors.
c. A trustee, receiver or agent under applicable law, or under a contract, who is appointed or authorized to take charge of Airline’s property for the purpose of enforcing a lien against such property, or for the purpose of the general administration of such property for the benefit of Airline’s creditors.

6. If any act occurs that permanently deprives Airline of the rights, power and privileges necessary for the proper conduct and operation of its Air Transportation Business.

7. If Airline abandons and fails to use its Exclusive Use Space, or Preferential Use Space for a period of thirty (30) calendar days at any one time, except when such abandonment and cessation are due to fire, earthquake, strike, governmental action, or acts, omissions or Default of City, or any other cause beyond Airline’s control.

8. If Airline uses or permits the use of its Exclusive Use Space, or Preferential Use Space at any time for any purpose for which the use thereof at that time is not authorized by this Agreement, or by a subsequent written agreement between the parties, or permits the use thereof in violation of any law, rule or regulation to which Airline has agreed in this Agreement to perform.

9. If Airline discontinues Air Transportation to the Airport as a consequence of Airline’s filing a bankruptcy petition, voluntary or involuntary, seeking a reorganization or readjustment of its indebtedness under the federal bankruptcy laws or under any other statute of the United States or any state thereof or being adjudged Item 1N - Page 90
Airport Use and Lease Agreement – Final Dated October 24, 2022 81 bankrupt, Airline shall be deemed to have forfeited its leasehold space.

10. If Airline is in violation of any material provision of this Agreement.

B. Prior to pursuing any remedy for a curable default by Airline, City shall, before pursuing any remedy, give written notice of such Default to Airline and an opportunity to cure the Default. Each notice of Default shall specify the alleged event of Default and the intended remedy.

C. If the alleged Default is nonpayment of rent, fees or other sums to be paid by Airline to City, Airline shall have thirty (30) calendar days after written notice is given to cure the Default. For the cure of any other Default, Airline shall promptly and diligently, after notice, commence curing the Default and shall have thirty (30) calendar days after written notice is given to complete the cure or, in the case of a failure or omission that cannot be cured by the payment of money and cannot be cured within thirty (30) calendar days, such additional time as the parties may agree thereto. If the Default is not curable, City may terminate this Agreement, with reasonable notice of Default, and / or pursue any remedy specified in Section

14.02 or as provided by law.

City’s Remedies
If any Default by Airline shall continue uncured following notice of Default for the period applicable to the Default under the provisions of this Agreement, or if the Default is not curable, City shall have the following remedies:

A. City may, at its election, terminate this Agreement by giving Airline notice of termination. No acts by City other than giving written notice to Airline shall terminate this Agreement. Acts of maintenance and efforts to relet, assign, reassign, allocate, reallocate, or relocate Airline Premises shall not constitute a termination of Airline's right to possession. On the giving of the notice, all Airline’s rights in the Airline Premises and in all improvements shall terminate. Termination under this Section 14.02(A) shall not relieve Airline from the payment of any sum then due City or from any claim for damages previously accrued or then accruing Item 1N - Page 91
Section 14.02
Airport Use and Lease Agreement – Final Dated October 24, 2022 82 against Airline.

B. City may, at its election, reenter Airline Premises by giving Airline notice of such election and, without terminating this Agreement, City may at any time relet Airline Premises and improvements or any parts thereof for the account and in the name of Airline or otherwise. City may execute any agreements made under this provision either in City’s name or in Airline's name and shall be entitled to all rents from the use, operation or occupancy of the Airline Premises or improvements or both. Airline shall nevertheless pay to City, on the due date specified in this Agreement, the equivalent of all sums required of Airline under this Agreement, plus City’s expenses, less the avails of any releting or attornment.

In addition to all other rights and remedies it may have, City shall have all of the rights and remedies of a landlord pursuant to Section 1951.2 and 1951.4 of the California Civil Code:

1. In the event that Airline breaches this Agreement and abandons the Airline Premises before the end of the Term hereof, or if Airline’s right to possession is terminated by City because of a breach of this Agreement, this Agreement terminates. Upon such termination, the City may recover from Airline:
a. The “worth at the time of award” of the unpaid Rent which had been earned at the time of termination;
b. The “worth at the time of award” of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that Airline proves could have been reasonably avoided;
c. The “worth at the time of award” of the amount by which the unpaid Rent for the balance of the Term hereof after the time of award exceeds the amount of such rental loss that Airline proves could reasonably be avoided; and
Item 1N - Page 92
Airport Use and Lease Agreement – Final Dated October 24, 2022 83 d. Any other amount necessary to compensate City for all the detriment proximately caused by Airline’s failure to perform its obligations under this Agreement, or which in the ordinary course of things would be likely to result therefrom.

2. The “worth at the time of award” of the amounts referred to in Section 14.02 (B) (1) (a) is computed by allowing interest at the rate of eighteen percent (18%) or, if the maximum charge permitted by law is less than the foregoing amount, then the rate shall be such amount determined to be the maximum legal amount. The “worth at the time of award” of the amount referred to in Section 14.02 (B) (1) (c) is computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1%).

3. Damages which City may recover pursuant to Section 14.02 (B) (1) (c) include the “worth at the time of award” of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such rental loss for the same period that Airline proves could be reasonably avoided; City may also recover damages pursuant to Section 14.02 (B) (1) (c) in the event that City relets the Airline Premises prior to the time of award and proves that in releting the property it acted reasonably and in a good-faith effort to mitigate the damages.

4. Efforts by City to mitigate the damages caused by Airlines breach of this Agreement do not waive City’s right to recover damages pursuant to said Section 1951.2 and this Section.

5. Nothing in this Section affects the right of City under this Agreement to indemnification for liability arising prior to the termination of this Agreement for personal injuries or property damage, as herein provided.

Item 1N - Page 93
Airport Use and Lease Agreement – Final Dated October 24, 2022 84

6. Notwithstanding the foregoing, the City has the remedy described in California Civil Code Section 1951.4 (City may continue lease in effect after Airline’s breach and abandonment and recover rent as it becomes due, if Airline has right to sublet or assign, subject only to reasonable limitations). In the event of Lessee’s breach of this Agreement and abandonment of the Airline Premises, pursuant to Section 1951.4 of the California Civil Code, City may, at its sole option, elect to continue this Agreement and enforce all its rights and remedies herein against Airline, including the right to recover the Rent as it becomes due.

C. City shall be entitled at its election to damages and shall have all the remedies available by law.

Possession by City
When giving notice of termination or notice of election to reenter the Airline Premises, City may take possession upon fifteen (15) calendar days’ notice or such later date as may be specified in such notice.

No Remedy Exclusive
No remedy conferred herein upon or reserved to City is intended to be exclusive and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any Default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle City to exercise any remedy reserved to it in this Agreement, it shall not be necessary to give any notice, other than such notice as may be required in this Agreement or by law.

Waiver and Voluntary Acts
No waiver of any breach or Default shall constitute a waiver of any other Item 1N - Page 94
Section 14.03
Section 14.04
Section 14.05
Airport Use and Lease Agreement – Final Dated October 24, 2022 85 breach or Default, whether of the same or any other term, agreement or condition.

No waiver, benefit, privilege or service voluntarily given or performed by either party shall give the other any contractual right by custom, estoppel or otherwise.

The subsequent acceptance of rent, fees or other money payments pursuant to this Agreement shall not constitute a waiver of any preceding breach or Default by Airline other than Default in the payment of the particular rental payment so accepted regardless of City’s knowledge of the preceding breach at the time of accepting this payment. Acceptance of rent, fees or other money payments after termination shall not constitute a reinstatement, extension or renewal of the Agreement or revocation of any notice or other act by City.

Additional Remedy in Bankruptcy
The parties hereto expressly agree, notwithstanding anything in this Agreement to the contrary, that in the event that Airline becomes a debtor under any chapter of the Bankruptcy Code and this Agreement has not been terminated prior to the commencement of Airline's bankruptcy proceedings, all rents, fees and charges payable by Airline to, or on behalf of, City hereunder, whether or not expressly denominated as rent, shall constitute rent solely for the purposes of calculating City's damage pursuant to 11 U.S.C. Section 502(b)(6) or any similar provision of the Bankruptcy Code, in the event that this Agreement is rejected in such bankruptcy proceeding.

Events Permitting Termination of Agreement by Airline
If City is in Default of any material portion of this Agreement, Airline may terminate this Agreement and terminate all of its future obligations hereunder at any time that Airline is not in Default in its payments or other obligations to City hereunder, and such Default continues for a period of sixty (60) calendar days after receipt of written notice of such Default from Airline.

Statement Regarding a Certified Access Specialist
Pursuant to California Civil Code §1938, the City states that the Airline Item 1N - Page 95
Section 14.06
Section 14.07
Section 14.08
Airport Use and Lease Agreement – Final Dated October 24, 2022 86 Premises:

Have not undergone an inspection by a Certified Access Specialist (CASp).

Have undergone an inspection by a Certified Access Specialist (CASp) and it was determined that the Airline Premises met all applicable construction-related accessibility standards and a disability access inspection certificate has been issued pursuant to California Civil Code §55.51 et seq.

Have undergone an inspection by a Certified Access Specialist (CASp) and it was determined that the Airline Premises did not meet all applicable construction-related accessibility standards pursuant to California Civil Code §55.51 et seq.

A Certified Access Specialist (CASp) can inspect the subject Airline Premises and determine whether the subject Airline Premises comply with all of the applicable construction-related accessibility standards under state law.

Although state law does not require a CASp inspection of the subject Airline Premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject Airline Premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the Airline Premises.

Item 1N - Page 96
•
•
Airport Use and Lease Agreement – Final Dated October 24, 2022 87

NOTICES
Delivery of Notices
A. Any request, demand, authorization, direction, notice, consent or waiver provided or permitted to be made upon, given by, or furnished to, the City or Airline shall be in writing and served personally, sent by certified mail, return receipt requested, express carrier delivery or via email, if email address is provided below. Either party shall have the right, by giving written notice to the other or to change the address at which its notices are to be received. Until any such change is made, notices shall be addressed and delivered as follows:

1. When to City:

Executive Director
Palm Springs International Airport
300 E. Tahquitz Canyon Way, Suite OFC
Palm Springs, CA 92262
and
Attention: City Manager
3200 E. Tahquitz Way, PO Box 2743
Palm Springs, CA 92261

2. When to Airline:
____________________________________________
____________________________________________
____________________________________________
Attention: ____________________________________
B. Any such notice or other document shall be deemed to be received as of three days after the date deposited in the mail, if mailed in accordance with Section 15.01.A
Item 1N - Page 97
Article 15.

Section 15.01
Airport Use and Lease Agreement – Final Dated October 24, 2022 88

MISCELLANEOUS
Successors and Assigns Bound
This Agreement shall be binding on and inure to the benefit of the successors and assigns of the parties hereto.

Governing Law
The parties hereto agree that this Agreement shall be governed and construed in accordance with the laws of the State of California.

Jurisdiction and Venue
The parties hereto agree that the State of California is the proper jurisdiction for litigation of any matters relating to this Agreement, and service mailed to the address of Airline set forth herein shall be adequate service for such litigation. The parties further agree that the state and Federal courts located in Riverside County, California are the proper place for venue as to any such litigation and Airline agrees to submit to the personal jurisdiction of such court in the event of such litigation.

Non-Liability
No member of City Council, an Airport Commissioner, or a director, officer, agent, consultant or employee of the City or Airline shall be charged personally or be held liable by or to the other party under any term or provision of this Agreement, or any amendment thereto, or because of any breach hereof, or because of its execution.

Attorneys’ Fees and Costs
In the event any action or suit or proceeding is brought by either party to collect the fees and charges due or to become due hereunder or any portion thereof or to take possession of said Airline Premises or to enforce compliance with this Agreement for failure to observe any of the covenants of this Agreement, Item 1N - Page 98
Article 16.

Section 16.01
Section 16.02
Section 16.03
Section 16.04
Section 16.05
Airport Use and Lease Agreement – Final Dated October 24, 2022 89 and such party is the prevailing party in such action, suit or proceeding, the losing party agrees to pay such sums as the Court may judge reasonable attorneys’ fees and costs to be allowed in said suit, action or proceeding.

Noninterference with Operation of the Airport
Airline, by accepting this Agreement, expressly agrees for itself, its successors and assigns that it will not make use of the Airline Premises in any manner that might interfere with the landing and taking off of aircraft at the Airport or otherwise constitute a hazard. In the event the aforesaid covenant is breached, upon reasonable notice to Airline and opportunity to cure, City reserves the right to enter into the Airline Premises hereby leased and cause the abatement of such interference at the expense of Airline.

City shall maintain and keep in reasonably good repair the Airport landing areas, including taxiways, and shall have the right to direct and control all activities of Airline in this regard.

Quiet Enjoyment
Airline shall, upon payment of the rentals and fees as herein required, and subject to performance and compliance by Airline of the covenants, conditions and agreements on the part of Airline to be performed and complied with hereunder, peaceably have and enjoy the rights, uses and privileges of the Airport, its appurtenances and facilities as granted hereby and by the Airport Rules and Regulations.

Taxes
A. Under this Agreement, a possessory interest subject to property taxation may be created. Notice is hereby given pursuant to California Revenue and Taxation Code, Section 107.6, and Government Code Section 53340.1, that Airline’s interest may be subject to property taxation and special taxation pursuant to The Mello Roos Community Facilities Act of 1982 (Chapter 2.5, commencing Item 1N - Page 99
Section 16.06
Section 16.07
Section 16.08
Airport Use and Lease Agreement – Final Dated October 24, 2022 90 with Section 5331, of Part 1 of , Division 2 of Title 5 the California Government Code), (Mello Roos Community Facilities Act of 1982) and that Airline may be subject to the payment of property taxes and special taxation levied on such interest.

B. Airline shall pay, but such payment shall not be considered part of Airport Revenue, all taxes (including any possessory interest tax), assessments and charges of whatever character which at any time during the term of this Agreement may be levied against Airline or become a lien by virtue of any levy, assessment or charge against Airline by federal, State and any other public agency, including the City, with respect to: (1) any of the space leased under this Agreement or such facilities of the Airport as are made available for use by Airline hereunder; (2) any personal property belonging to Airline situated on the space leased under this Agreement; or (3) Airline’s leasehold improvements or operations hereunder. Payment of any such taxes, assessments and charges, shall be made by Airline directly to the taxing or assessing authority charged with collection thereof.

C. Airline may, at its own expense, contest the amount or validity of any tax or assessment, or the inclusion of the space leased under this Agreement as taxable or assessable property, directly against the taxing or assessing authority.

Airline shall indemnify and hold City harmless from all taxes, penalties, costs, expenses and attorney fees incurred by City resulting directly or indirectly from all such tax contests.

D. On any termination of this Agreement, all lawful taxes then levied and all liens upon any such property or taxable interest therein shall be paid in full by Airline forthwith, or as soon as a statement thereof has been issued by the tax collector if termination occurs during the interval between attachment of the lien and issuance of a statement.

Item 1N - Page 100
Airport Use and Lease Agreement – Final Dated October 24, 2022 91 Liens
Airline shall cause to be removed promptly any and all liens of any nature arising out of or because of any construction performed by Airline or any of its contractors or subcontractors upon Exclusive Use Space, Preferential Use Space, or Joint Use Space or arising out of or because of the performance of any work or labor by or for it to them at said Airline Premises, reserving the right to contest in court the validity of any such liens. Airline shall have the right to post an appropriate bond to cover its obligations pursuant to this Section 16.09.

In the event any person or corporation shall attempt to assert a mechanic's lien against the Airline Premises for improvements made by Airline, Airline shall indemnify and hold City harmless from such claim, including the cost of defense.

Subordination to Agreements with the U.S. Government
This Agreement is subject and subordinate to the provisions of any agreements heretofore or hereafter made between City and the United States, relative to the development, operation or maintenance of the Airport, the execution of which has been required as a condition precedent to the transfer of federal rights or property to City for Airport Purpose, or to the expenditure of federal funds for the improvement or development of the Airport, including the expenditure of federal funds for the development of the Airport in accordance with the provisions of the Federal Aviation Act of 1958, the Federal Aid to Airports Act, the Airport and Airway Development Act of 1970, and the Airport and Airway Improvement Act of 1982, as such acts may have been amended from time to time. City covenants that, to the best of its knowledge, it has no existing agreements with the United States that contain provisions expressly in conflict with the express provisions of this Agreement.

In the event that the FAA requires, as a condition precedent to the granting of funds for the improvement of the Airport, modification or changes to this Agreement, Airline agrees to consent to such amendments, modifications, Item 1N - Page 101
Section 16.09
Section 16.10
Airport Use and Lease Agreement – Final Dated October 24, 2022 92 revisions, supplements or deletions of any of the terms, conditions or requirements of this Agreement as may be reasonably required to enable City to obtain such grant of funds, provided that in no event shall such changes impair the rights of Airline hereunder.

Incorporation of Exhibits
All exhibits referred to in this Agreement are intended to be and hereby are specifically made a part of this Agreement.

Affiliate Designation and Requirements
Airline shall furnish City with Exhibit F evidencing current Affiliate(s) for Airline at least five (5) calendar days prior to the Effective Date of this Agreement.

Airline shall maintain a current Exhibit F with the City evidencing Affiliate(s) during the Term of this Agreement and shall provide at least five (5) calendar days prior written notice to the Executive Director of any changes to Affiliates at the Airport.

Incorporation of Required Provisions
The parties incorporate herein by this reference all provisions lawfully required to be contained herein by any governmental body or agency.

Force Majeure
Neither City nor Airline shall be deemed in violation of this Agreement if it is prevented from performing any of the obligations hereunder by reason of strikes, boycotts, labor disputes, embargoes, shortage of energy or materials, acts of God, acts of a public enemy, terrorism, acts of superior governmental authority, weather conditions, riots, rebellion, sabotage or any other circumstances for which it is not responsible or which are not within its control, provided these provisions shall not excuse Airline from paying the rentals and fees specified in Article 5.

Item 1N - Page 102
Section 16.11
Section 16.12
Section 16.13
Section 16.14
Airport Use and Lease Agreement – Final Dated October 24, 2022 93 Headings
The headings of the Articles and Sections of this Agreement are inserted only as a matter of convenience and for reference and do not define or limit the scope or intent of any provisions of this Agreement and shall not be construed to affect in any manner the terms and provisions hereof or the interpretation or construction thereof.

Remedies
The rights and remedies given to the City and Airline in this Agreement are distinct, separate and cumulative, and no one of them, whether or not exercised by either party, shall be deemed to be in exclusion of any of the others herein or by law or in equity provided.

Nonexclusive Rights
It is understood and agreed that nothing herein contained shall be construed to grant to Airline any exclusive right or privilege within the meaning of Section 308 of the Federal Aviation Act for the conduct of any activity on the Airport, except that, subject to the terms and provisions hereof, Airline shall have the right to exclusive possession of the Exclusive Use Space leased to Airline under the provisions of this Agreement.

Inspection of Books and Records
Each party hereto, at its expense and on reasonable notice, shall have the right from time to time to inspect the books, records, and other data of the other party relating to the provisions and requirements hereof, provided such inspection is made during regular business hours.

Generally Accepted Accounting Principles
Whenever any report or disclosure referred to in this Agreement consists, either in whole or in part, of financial information, such report or disclosure shall be Item 1N - Page 103
Section 16.15
Section 16.16
Section 16.17
Section 16.18
Section 16.19
Airport Use and Lease Agreement – Final Dated October 24, 2022 94 prepared in accordance with generally accepted accounting principles, except where provided to the contrary in this Agreement.

General Interpretation
Insofar as this Agreement grants, permits or contemplates the use of space or facilities or the doing of any other act or thing at the Airport by Airline, such use or the doing of such act or thing is to be in connection with the operation of the civil air transportation system by Airline for the carriage by aircraft of persons, property, cargo, baggage, and mail on scheduled or nonscheduled flights, whether as a common carrier, a contract carrier, a private carrier or otherwise. Each of the parties, however, has entered into this Agreement solely for its own benefit; and (without limiting the right of either party to maintain suits, actions or other proceedings because of breaches of this Agreement) the Agreement does not grant to any third person (excepting a successor party to City or Airline) a right to claim damages or bring any suit, action or other proceeding against either City or Airline because of any breach hereof.

Surrender of Possession - Holding Over
Airline agrees to yield and deliver to the City the possession of the Airline Premises including the Airline Premises leased exclusively or preferentially to Airline or jointly to Airline and others, at the termination of this Agreement by expiration or otherwise. Such Airline Premises shall be delivered in clean and good condition in accordance with Airline’s express obligations hereunder, except for reasonable wear and tear, fire and other casualty. Airline shall have the right at any time during the term of this Agreement, or any renewal or extension hereof, to remove or sell its trade fixtures and equipment situated on the Airline Premises that were installed, or placed by it, at its expense in, on or about the Airline Premises pursuant to the provisions of this Agreement subject however to any valid lien that the City may have thereon for unpaid fees or other charges. Any such removal shall be at Airline’s expense and accomplished in a good workmanlike manner. Any damage occasioned by such removal shall be repaired Item 1N - Page 104
Section 16.20
Section 16.21
Airport Use and Lease Agreement – Final Dated October 24, 2022 95 at Airline’s expense so that the Airline Premises may be surrendered in a good, clean and sanitary condition.

Any holding over by Airline after cancellation or termination of this Agreement shall not operate to extend or renew such Agreement for any further term whatsoever, except Airline’s holding over after the cancellation or termination of the Agreement shall be considered a month-to-month tenancy terminable by either party upon thirty (30) days’ prior written notice of such termination. Such holding over shall otherwise be upon the same terms and conditions as set forth in this Agreement.

Consent Not to be Unreasonably Withheld
Whenever the consent or approval of the City or the Airline is called for herein, it is understood and agreed that such approval shall be in writing and obtained in advance and shall not be unreasonably withheld or delayed.

Authority of Executive Director
All rights and obligations of City under this Agreement may be exercised by the Executive Director or his designee, unless specifically provided otherwise or required by law.

Invalid Provision
If any covenant, condition or provision herein contained is held to be invalid by any court of competent jurisdiction, the invalidity of any such covenant, condition or provision shall in no way affect any other covenant, condition or provision herein contained, provided that the invalidity of any such covenant, condition or provision does not materially prejudice either party hereto in its respective rights and obligations contained in the valid covenants, conditions or provisions in this Agreement.

Item 1N - Page 105
Section 16.22
Section 16.23
Section 16.24
Airport Use and Lease Agreement – Final Dated October 24, 2022 96 Public Address System
Airline agrees that the use of City’s public address, voice and data communication system will be in accordance with the Airport Rules and Regulations. Airline shall not install, cause to be installed or use any other such system at the Terminal Building without the prior written approval of Director.

Employees of Airline
Airline shall require all of its employees, agents, officers, representatives, suppliers, contractors, subcontractors, licensees, subtenants, invitees, and suppliers hired by Airline and working about the Terminal Building to wear clean and neat attire and to display appropriate identification.

Removal of Disabled Aircraft
Airline shall promptly remove any of its disabled aircraft from any part of the Airport (including, without limitation, runways, taxiways, aprons and Bono Concourse and RJ Concourse Aircraft Gates) and place any such disabled aircraft in such storage areas as may be designated by City (or at Airline’s discretion, in an off-Airport location). Airline may store such disabled aircraft only for such length of time and on such terms and conditions as may be established by City. If Airline fails to remove any of its disabled aircraft promptly, City may, but shall not be obligated to, cause the removal of such disabled aircraft, provided, however, the obligation to remove or store such disabled aircraft shall not be inconsistent with federal and State laws and regulations and Airline agrees to reimburse City for all costs of such removal, and Airline further hereby releases City from any and all claims for damage to the disabled aircraft or otherwise arising from or in any way connected with such removal by City, except to the extent such damage arises from the negligence or willful misconduct of City, its employees, agents or contractors.

Item 1N - Page 106
Section 16.25
Section 16.26
Section 16.27
Airport Use and Lease Agreement – Final Dated October 24, 2022 97 Licenses, Fees and Permits
Airline shall obtain and pay for all licenses, fees, permits, or other authorization or charges as required under federal, State or local laws and regulations insofar as they are necessary to comply with the requirements of this Agreement and the privileges extended hereunder.

Airport Access License Permit
City reserves the right to establish a licensing or permit procedure for vehicles requiring access to and operations on the Aircraft Apron and to levy directly against Airline or its suppliers a uniform and nondiscriminatory regulatory or administrative charge for issuance of such Airport access license or permit. 14 Code of Federal Regulations Part 77 Compliance
Airline agrees to comply with the notification and review requirements covered 14 CFR Part 77 in the event future construction of a building is planned for the Airline Premises, or in the event of any planned modification or alteration of any present or future building or structure on the Airline Premises.

Reservations - Airspace and Noise
There is hereby reserved to City, its successors and assigns, for the use and benefit of the public, a right of flight for the passage of aircraft in the airspace above the surface of the Airline Premises. This public right of flight shall include the right to cause in such airspace any noise inherent in the operation of any aircraft used for navigation or flight through such airspace or landing at, taking off from, or other operations on the Airport.

National Emergency
This Agreement and all the provisions hereof shall be subject to whatever right the U.S. Government now has, or in the future may have or acquire, affecting the control, operation, regulation and taking over of said Airport or the exclusive or Item 1N - Page 107
Section 16.28
Section 16.29
Section 16.30
Section 16.31
Section 16.32
Airport Use and Lease Agreement – Final Dated October 24, 2022 98 nonexclusive use of the Airport by the United States during time of war or national emergency.

Time is of the Essence
Time is of the essence in this Agreement.

Noise Abatement and Mitigation
Airline acknowledges that the City of Palm Springs and its neighboring cities are noise sensitive communities; therefore, Airline shall comply with any formal noise abatement program or policy established by the City in conformance with federal statutes, laws, rules, and regulations and use reasonable efforts to comply with informal noise abatement programs established by the City. The Airline shall notify the City promptly and may challenge such programs if the Airline believes such formal or informal noise abatement programs may interfere with safe aircraft operation or if Airline believes such programs are not in conformance with federal statues, laws, rules and regulations.

Authority for Agreement
Airline warrants and represents that it has the right, power, and legal capacity to enter into, and perform its obligations under this Agreement, and no approvals or consents of any persons are necessary in connection with it. The execution, delivery, and performance of this Agreement by the undersigned Airline representatives have been duly authorized by all necessary corporate action of Airline, and this Agreement will constitute a legal, valid, and binding obligation of Airline, enforceable in accordance with its terms.

No Oral Agreements
This Agreement (i) covers in full each and every agreement of every kind or nature whatsoever between the parties hereto concerning this Agreement, (ii) supersedes, any and all previous obligations, agreements and understandings, if any, between the parties, oral or written, and (iii) merges all preliminary Item 1N - Page 108
Section 16.33
Section 16.34
Section 16.35
Section 16.36
Airport Use and Lease Agreement – Final Dated October 24, 2022 99 negotiations and agreements of whatsoever kind or nature herein. Airline acknowledges that no representations or warranties of any kind or nature not specifically set forth herein have been made by City or its agents or representatives.

Entire Agreement
This Agreement, together with all exhibits attached hereto, constitutes the entire agreement between the parties hereto, and all other representations or statements heretofore made, verbal or written, are merged herein, and this Agreement may be amended only in writing, and executed by duly authorized representatives of the parties hereto.

Item 1N - Page 109
Section 16.37
Airport Use and Lease Agreement – Final Dated October 24, 2022 100

SIGNATURE PAGE TO AIRPORT USE AND LEASE AGREEMENT
BY AND BETWEEN THE CITY OF PALM SPRINGS AND (*INSERT NAME*) IN WITNESS WHEREOF, the parties have executed and entered into this Agreement as of the date first written above.

AIRLINE:

By:

Signature
Date:

By:

Signature
(2nd signature required for Corporation)
Date:

CITY OF PALM SPRINGS:

APPROVED BY CITY COUNCIL:

Date: ________ Item No. ________
APPROVED AS TO FORM: ATTEST:

By:

City Attorney
By:

City Clerk
APPROVED:

By:

City Manager
Date: :

Item 1N - Page 110

EXHIBIT A

AIRPORT BOUNDARY
Item 1N - Page 111

EXHIBIT B

TERMINAL BUILDING SPACE MAPS
Item 1N - Page 112

EXHIBIT C

SUMMARY OF TERMINAL BUILDING AREAS
Item 1N - Page 113

EXHIBIT D

RATES FOR RENTALS, FEES, AND CHARGES
Item 1N - Page 114

EXHIBIT E

RESPONSIBILITIES OF CITY AND AIRLINE
FOR

OPERATION AND MAINTENANCE OF TERMINAL BUILDING
Item 1N - Page 115

EXHIBIT F

AFFILIATE IDENTIFICATION AND REQUIREMENTS
Item 1N - Page 116

EXHIBIT G

MONTHLY ACTIVITY REPORT
Item 1N - Page 117

EXHIBIT H

FEDERAL NONDISCRIMINATION REQUIREMENTS
Item 1N - Page 118
Title VI Clauses for Compliance with Nondiscrimination Requirements.

During the performance of this Agreement, Airline, for itself, its assignees, and successors in interest, agrees as follows:

1. Compliance with Regulations: Airline will comply with the Title VI List of Pertinent Nondiscrimination Acts and Authorities (“Nondiscrimination Acts and Authorities” as set forth in paragraph B below), as they may be amended from time to time, which are herein incorporated by reference and made a part of this Agreement.

2. Nondiscrimination: Airline, with regard to the work performed by it during this Agreement, will not discriminate on the grounds of race, color, or national origin in the selection and retention of subcontractors, including procurements of materials and leases of equipment. Airline will not participate directly or indirectly in the discrimination prohibited by the Nondiscrimination Acts and Authorities, including employment practices when this Agreement covers any activity, project, or program set forth in Appendix B of 49 CFR part 21.

3. Solicitations for Subcontracts, including Procurements of Materials and Equipment: In all solicitations, either by competitive bidding or negotiation made by Airline for work to be performed under a subcontract, including procurements of materials, or leases of equipment, each potential subcontractor or supplier will be notified by Airline of Airline’s obligations under this Agreement and the Nondiscrimination Acts and Authorities on the grounds of race, color, or national origin.

4. Information and Reports: Airline will provide all information and reports required by the Acts, the Regulations, and directives issued pursuant thereto and will permit access to its books, records, accounts, other sources of information, and its facilities as may be determined by the sponsor or the Federal Aviation Administration to be pertinent to ascertain compliance with such Nondiscrimination Acts and Authorities and instructions. Where any information required of Airline is in the exclusive possession of another who fails or refuses to furnish the information, Airline will so certify to the sponsor or the Federal Aviation Administration, as appropriate, and will set forth what efforts it has made to obtain the information.

5. Sanctions for Noncompliance: In the event of Airline’s noncompliance with the non-discrimination provisions of this Agreement, City will impose such contract sanctions as it or the Federal Aviation Administration may determine to be appropriate, including, but not limited to:
a. Withholding payments to Airline under this Agreement until Airline complies; and/or
b. Cancelling, terminating, or suspending a contract, in whole or in part.

Incorporation of Provisions: Airline will include the provisions of paragraphs one through six in every subcontract, including procurements of materials and leases of equipment, unless exempt by the Acts, the Regulations, and directives issued pursuant thereto. Airline will take action with respect to any subcontract or procurement as the Item 1N - Page 119
sponsor or the Federal Aviation Administration may direct as a means of enforcing such provisions including sanctions for noncompliance. Provided, that if Airline becomes involved in, or is threatened with litigation by a subcontractor, or supplier because of such direction, Airline may request the sponsor to enter into any litigation to protect the interests of the sponsor. In addition, Airline may request the United States to enter into the litigation to protect the interests of the United States.

Item 1N - Page 120

ATTACHMENT B

PALM SPRINGS INTERNATIONAL AIRPORT

NON-SIGNATORY AIRLINE OPERATING PERMIT
Item 1N - Page 121
Non-Signatory Airline Operating Permit
July 1, 2023
Item 1N - Page 122
Non-Signatory Airline Operating Permit i

NON-SIGNATORY AIRLINE OPERATING PERMIT

TABLE OF CONTENTS
DEFINITIONS ..................................................................................................................... 2 TERM .................................................................................................................................. 7 RIGHTS, SPECIFIC PRIVILEGES, AND AIRLINE PREMISES ........................................ 8 RENTALS AND FEES...................................................................................................... 16 MAINTENANCE, REPAIR, ALTERATIONS AND IMPROVEMENTS............................. 23 Item 1N - Page 123
Non-Signatory Airline Operating Permit ii

DAMAGE OR DESTRUCTION, INSURANCE, INDEMNIFICATION AND
RELEASE OF LIABILITY................................................................................................. 28 ENVIRONMENTAL COMPLIANCE ................................................................................. 34 ASSIGNMENT .................................................................................................................. 42

RULES AND REGULATIONS, COMPLIANCE WITH LAW,
NONDISCRIMINATION .................................................................................................... 42 NOTICES .......................................................................................................................... 47 MISCELLANEOUS........................................................................................................... 47 Item 1N - Page 124
Non-Signatory Airline Operating Permit iii

LIST OF EXHIBITS
Item 1N - Page 125
Non-Signatory Airline Operating Permit 1

NON-SIGNATORY AIRLINE OPERATING PERMIT
This NON-SIGNATORY AIRLINE OPERATING PERMIT (“PERMIT”) is issued as of the day of by the City of Palm
Springs, a charter city and municipal corporation organized and existing under the laws of the State of California (“City”), to ______________, a corporation organized and existing under the laws of the State of _________________ (“Airline”); whose initial address and representative is as follows:

Address:_________________________________________________________ City / State / Zip Code:______________________________________________ Airline Representative: ______________________________________________ Title: ____________________________________________________________ Phone: ______________________________________
Fax:_________________________________________
Email: _______________________________________

RECITALS
A. The City owns and operates the Palm Springs International Airport (“Airport”), located in the City of Palm Springs, County of Riverside, State of California.

B. The City operates the Airport as a governmental function for the primary purpose of providing to the public the service of air transportation.

C. Airline is engaged in the business of commercial air transportation of persons, property, cargo and mail (“Air Transportation”) and desires to enter into a Permit with the City to use certain Airport premises and exercise certain rights, licenses, services and privileges at the Airport in connection with its Air Transportation Business.

D. City has the right to issue and enter into this Permit and to grant the use of its property at the Airport to Airline for the operation of Airline’s Air Transportation Business.

E. To the extent this Permit may be construed as an exclusive or limited agreement in connection with the management of the Airport’s facilities and concessions, which is not the parties intent, the Airline acknowledges that this Permit is being issued by the City under the provisions of California Public Utilities Code Section 21690.5 et seq.

Item 1N - Page 126
Non-Signatory Airline Operating Permit 2
NOW, THEREFORE, In consideration of the covenants and promises in this Permit, Airline covenants, agrees and binds itself as follows:

DEFINITIONS
Definitions
When used elsewhere in this Permit, the words and phrases in this Section 1.01 shall have the following meanings:

A. “Affiliate” shall mean any Air Transportation Company that:
(1) is a parent or subsidiary of Airline, a subsidiary of the parent of Airline or otherwise under common control with Airline.
(2) shares an International Air Transport Association (IATA) code with Airline at the Airport.
(3) otherwise operates under essentially the same trade name as Airline or its parent or subsidiary at the Airport or uses essentially the same livery as Airline or its parent or subsidiary; provided that no “major” airline, as such term is defined by the FAA, shall be classified as an Affiliate of another “major” airline unless either clause (1) or (3) above defines the relationship between such airlines at the Airport. Airline must designate in writing to the City any Air Transportation Company that will be an Affiliate of that Airline at the Airport. Airline must also designate in writing to the City to terminate such Affiliate status of an Air Transportation Company. Affiliates shall have the rights afforded Airline through this Permit without payment of any additional charges or premiums, provided Airline:
(a) remains a signatory to this Permit.
(b) agrees to be billed for Affiliate’s activity at the Airport related to activity under Airline’s brand; while it is flying on the behalf of Airline at the Airport.

Item 1N - Page 127
Non-Signatory Airline Operating Permit 3
(c) agrees and shall be obligated to serve as a financial guarantor for all rentals, fees, and charges incurred by any Affiliate of Airline while it is flying on behalf of Airline at the Airport. Airline shall be responsible for any and all unpaid rentals, fees, and charges of any such Affiliate while such Affiliate operates at the Airport as an Affiliate of Airline; provided however, Airline shall only be responsible for such payments as relate to any terminated Affiliate’s operations before such termination as an Affiliate of Airline took effect. Termination as an Affiliate of Airline will not occur until Airline notifies City in writing and such termination will be effective as of the date of such notification.

B. “Aircraft Aprons” shall mean those areas of the Airport that are designated by the City for the parking of Airline aircraft and support vehicles, and the loading and unloading of passenger aircraft.

C. “Aircraft Arrivals” shall mean any and all landings by aircraft at the Airport but shall exclude any landings by general aviation aircraft or by aircraft owned or operated by the U.S. Government.

D. “Aircraft Gate” shall mean a specific portal located in the Bono and RJ Concourse passenger holdrooms which provides passenger access to and from an Aircraft Parking Position. Bono Concourse Aircraft Gates include, CUPPS system and equipment, a gate podium, a Loading Bridge, and adjoining Aircraft Parking Position while RJ Concourse Aircraft Gates include CUPPS system and equipment, a gate podium, and an adjoining ground level Aircraft Parking Position. Aircraft Gates are shown on Exhibit B.

E. “Aircraft Parking Position” shall mean the marked positions located on the Aircraft Aprons adjacent to the Bono and RJ Concourses where Airline aircraft are required to park to enplane and deplane passengers.

F. “Airfield” shall mean those portions of the Airport provided for the landing, taking off, and taxiing of aircraft, including runways, taxiways, approach and runway Item 1N - Page 128
Non-Signatory Airline Operating Permit 4
protection zones, safety areas, infield areas, landing and navigational aids, and land areas required by or related to aeronautical use of the Airport (other than the Aircraft Aprons).

G. “Airline” shall mean the Air Transportation Company executing this Permit.

H. “Airline Premises” shall mean those areas in the Terminal Building assigned to Airline by City as Exclusive Use Space, Preferential Use Space or Joint Use Space, as defined herein, and shown in Exhibits B and C, attached hereto and incorporated herein.

I. “Airport” shall mean the Palm Springs International Airport owned and operated by the City of Palm Springs, the location of which is 3400 East Tahquitz Canyon Way, Palm Springs, California, Riverside County, as it exists as of the effective date of this Permit and as it may be changed from time to time in the future.

J. “Airport Purpose” shall mean any action or undertaking by City directly or indirectly related to the development and preservation of the Airport for air commerce.

K. “Airport Rules and Regulations” shall mean those certain rules and regulations adopted by the City for the use and occupancy of the Airport as described further in Section 9.02.

L. “Air Transportation” shall mean the carriage of persons, property, cargo, baggage, or mail by aircraft.

M. “Air Transportation Business” shall mean the business operated by Airline at the Airport for the commercial transportation by air of persons, property, mail, parcels, or cargo and associated services.

N. “Air Transportation Company” shall mean a legal entity engaged in the business of scheduled or non-scheduled commercial transportation by air of persons, property, mail, parcels or cargo and associated services.

Item 1N - Page 129
Non-Signatory Airline Operating Permit 5
O. “Baggage Handling System, or BHS” shall mean the City-owned systems and equipment at the Airport, exclusive of the TSA inspection systems and equipment, used for the transportation of checked baggage.

P. “Code of Federal Regulations, or CFR” shall mean the codification of the general and permanent rules published in the Federal Register by executive departments and agencies of the United States of America.

Q. “Common Use Passenger Processing System (CUPPS)” shall mean City-owned IT systems and equipment provided, by the City for use by Airline, including but not limited to systems and equipment for passenger processing, flight and baggage information display, and baggage handling.

R. “Effective Date” shall mean July 1, 2023.

S. “Executive Director” shall mean the person designated Executive Director by City, or such other person, division, department, bureau or agency, as may be designated by the City Council or the City Manager from time to time to exercise functions equivalent or similar to those now exercised by the Executive Director; the term also includes any person expressly designated by the Executive Director to exercise rights/and or obligations empowered in the “Executive Director” under this Permit.

T. “Enplaned Passenger” shall mean any revenue passenger boarding an aircraft at the Terminal Building, including any such passenger that previously disembarked from another aircraft of the same or a different Air Transportation Company or from the same aircraft, previously operating under a different flight number.

U. “Exclusive Use Space” shall mean that space set forth in Exhibits B and C consisting of Airline office, operations, and curb-side check in space and leased by City to Airline for Airline’s sole use.

V. “FAA” shall mean the Federal Aviation Administration of the United Item 1N - Page 130
Non-Signatory Airline Operating Permit 6
States Government or any federal agency or agencies succeeding to its jurisdiction.

W. “Joint Use Space” shall mean that space set forth in Exhibit B, which is attached hereto and incorporated herein, and leased by City to Airline for shared use with one or more other airlines.

X. “Maximum Gross Landing Weight” shall mean that maximum certificated weight, in thousand (1,000) pound units, of each aircraft authorized by the FAA to land at the Airport as recited in Airline’s flight manual governing that aircraft type.

Y. “Non-Signatory Airline” shall mean Airline or its Affiliate or any other Air Transportation Company serving the Airport that has been issued a Permit by the City, and is paying 1.25 times the Signatory Airline rates as outlined in Exhibit D.

Z. “Passenger Facility Charge (PFC)” shall mean a fee authorized by 49 United States Code (USC) 40117 and regulated by 14 CFR Part 158 as such statute and regulations currently exist or as they may be amended during the Term of this Permit.

BB. “Permit” shall mean this Non-Signatory Airline Operating Permit.

CC. “Preferential Use” shall mean nonexclusive use to which an airline has priority over all other users, subject to the terms and conditions of this Permit, in common with others.

DD. “Preferential Use Space” shall mean that portion of Airline Premises that is not Exclusive Use Space or Joint Use Space in which Airline has priority over all other users, subject to the terms and conditions of this Permit, thereof and as set forth in Exhibit B and Exhibit C.

EE. “Public View” shall mean those areas within the Terminal Building which are reasonably expected to be seen by the general public when in the Terminal Building.

FF.“Signatory Airlines” shall mean each Airline and its Affiliates and other Air Item 1N - Page 131
Non-Signatory Airline Operating Permit 7
Transportation Companies serving the Airport that are party to a Signatory Agreement selling tickets under their own name and is obligated to pay City rentals and fees in the amount of at least $250,000 per year.

GG. “Terminal Building” shall mean the passenger terminal building and associated curbside entrance areas located on the Airport as shown on Exhibit B.

HH. “TSA” shall mean the Office of Homeland Security and Transportation Security Administration, or their authorized successor(s).

II. “Turn” shall mean the arrival and departure of an aircraft from an Airline Gate. The movement of an empty aircraft to or from an Airline Gate shall not constitute a Turn, unless said movement is immediately (a) followed by the enplaning of passengers or (b) preceded by the deplaning of passengers.

Cross-References
All references to articles, sections, and exhibits in this Permit relate to material in this Permit unless specifically noted otherwise.

TERM
Effective Date
This Permit shall commence upon execution by City and Airline and shall continue on a month-to-month basis until such time as either party provides the other party in writing at least thirty (30) days’ notice of cancellation/termination.

Airline’s Rights Upon Expiration of Permit
Upon expiration or early termination of this Permit, all of Airline’s rights, authority, and privileges to use the Airport and occupy Airport facilities as granted by the City herein shall cease.

Surrender of Airline Premises
Item 1N - Page 132
Non-Signatory Airline Operating Permit 8
Airline covenants and agrees that on expiration of this Permit, or on earlier termination as hereinafter provided, or on reassignment of the Airline Premises to others as hereinafter provided, it will peaceably surrender possession of the Airline Premises, or that portion of the Airline Premises that has been reassigned, as applicable, leased hereunder in good condition, reasonable wear and tear, acts of God, acts of terrorism, fire and other casualties excepted, and City shall have the right to take possession of said Airline Premises, or that portion of the Airline Premises that has been reassigned, as applicable.

Airline shall have the right, on termination or reassignment and within thirty (30) days thereafter, to remove all trade fixtures, equipment and other personal property installed or placed by it at its expense, in, on or about the Airport, subject to any valid lien that City may have thereon for unpaid rentals or fees. All City property damaged by, or as the result of, the removal of Airline’s property, shall be restored by Airline, at its own expense, to the condition existing prior to such damage.

Airline shall not abandon any of its property on the Airline Premises. Any and all property not removed by Airline within thirty (30) calendar days from termination or reassignment shall be disposed of by the City and all direct and indirect costs associated with the disposal shall be paid by Airline.

This Section 2.03 shall survive the expiration or termination of this Permit.

RIGHTS, SPECIFIC PRIVILEGES, AND AIRLINE PREMISES
Use of the Airport
The parties agree that the purpose of this Permit is to enable Airline to provide an Air Transportation Business at the Airport. Consistent with this purpose, Airline, its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, and suppliers shall have the right to the use of the Airport and appurtenances, together with all facilities, improvements, equipment, and services that have been or may Item 1N - Page 133
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hereafter be provided for use at or in connection with the Airport, subject to the Airport Rules and Regulations and the terms of this Permit.

Specific Rights of Airline at the Airport
Consistent with the purpose set forth in Section 3.01, and subject to the terms and conditions of this Permit, Airline shall have the right to use, in common with others so authorized by City, areas, other than areas leased exclusively or preferentially to others (except as set forth herein), facilities, equipment, and improvements at the Airport for the operation of Airline's Air Transportation Business and all activities reasonably necessary to such operations, to include the following:

A. The landing, taking off, flying over, taxiing, towing, provisioning, and conditioning of Airline's aircraft and, in areas designated by City, the extended parking, servicing, loading or unloading, storage, or maintenance of Airline's aircraft and support equipment subject to the availability of space; provided, however, that Airline will not permit the use of the Airfield by any aircraft operated or controlled by Airline that exceeds the design strength or capability of the Airfield as described in the then-current FAA-approved Airport Layout Plan (ALP) or subsequent engineering evaluation report.

B. The loading and unloading of persons, property, parcels, mail and belly cargo by motor vehicles or other means of conveyance reasonably approved by City at Aircraft Aprons or such other locations as may be designated by the Executive Director.

C. Subject to the provisions of Section 9.02 hereof, Airline shall have the right to perform ground handling services for itself or other airlines engaged in an Air Transportation Business. Said ground handling services may be provided via an independent vendor so long as said vendor is properly licensed by the City to operate on the Airport. In the event Airline agrees to ground handle any portion of the operations of another Air Transportation Company, excluding Affiliates, Airline Item 1N - Page 134
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shall provide City advance written notice of such proposed activities, including a description of the type and extent of services to be provided. Consent shall be in writing and shall not be unreasonably withheld. Notwithstanding the foregoing, Airline shall not provide ground handling services to any Air Transportation Company which does not have the consent of City for the operation of its Air Transportation Business at the Airport and a handling agreement between Airline and the Air Transportation Company.

D. The sale of air transportation tickets and services, the procession of passengers and their baggage for air travel, the sale, handling and providing of mail, freight, and express services, and other reasonable and customary activities associated with Airline’s Air Transportation Business.

E. This Permit does not convey any rights to Airline to provide commercial ground transportation services to any person upon payment of any fee or charge.

However, so long as all applicable ground transportation ordinances, laws, Airport Rules and Regulations are complied with, Airline may provide, directly or by agreement with third parties, prearranged ground transportation services for its employees, or passengers who must be transported to or from the Airport due to weather or other extraordinary event, without the imposition by the City of any ground transportation fees or other charges in addition to those specified in this Permit, provided that approval of the Executive Director is secured in advance of such transportation. If a third party is utilized to provide such ground transportation services, then Airline shall provide (or cause to be provided) documentation that the third party’s transportation was provided exclusively to Airline’s employees, or passengers who must be transported to or from the Airport due to weather or other extraordinary event, to the satisfaction of the Executive Director, to receive an exemption from the City of its ground transportation fees and other charges.

F. The purchase at the Airport or elsewhere, of fuels, lubricants, and any other supplies and services, from any person or company, subject to City's right to require that each provider of services or supplier to Airline secures written Item 1N - Page 135
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authorization from City to conduct such activity at the Airport, pays required applicable service-oriented fees, and abides by all reasonable Airport Rules and Regulations established by City. No discriminatory limitations or restrictions shall be imposed by City that interferes with such purchases; provided, however, nothing herein shall be construed to permit Airline to store aviation fuels at the Airport. The granting of the right to store aviation fuels shall be subject to the execution of a separate agreement between Airline and City.

G. The training at the Airport of employees of Airline. Training is to be limited to that incidental to Airline’s Air Transportation Business at the Airport. Flight training and testing of aircraft and other equipment shall be undertaken by Airline only with the prior written approval of the Executive Director, and to the extent permitted by, and subject to, the conditions of the Airport Rules and Regulations.

All training and testing conducted by Airlines shall be incidental to the use of the Airport in the operation by Airline of its Air Transportation Business and shall not unreasonably hamper or interfere with the use of the Airport and its facilities by others entitled to the use of same. City reserves the right to restrict or prohibit such training and testing operations which it deems to unreasonably interfere with the use of the Airport, including excessive noise as reasonably determined by City.

H. The purchase of Airline’s requirements of personal property, services, food, beverage, other passenger supplies, and any other materials and supplies used by Airline that are incidental to the operation of Airline’s Air Transportation Business. Airline may: (i) provide food and beverages, at Airline's sole cost and expense, or install or maintain vending machines in its non-public Exclusive Use Space, for the sole use of Airline's employees, subject to the approval of the Executive Director, (ii) provide for its own in-flight kitchen for catering services to its passengers and crews, or to those of its Affiliates for consumption aboard aircraft, (iii) provide food and beverages to its customers and guests during irregular operations or emergencies, and (iv) provide food and beverages to its guests in a VIP-type club.

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I. The sale, disposition, or exchange of Airline’s aircraft, engines, accessories and other equipment, and materials or supplies (excepting fuel and lubricants), provided that (1) such items are not otherwise available on the Airport from a vendor other than another airline, and (2) such right shall not be construed as authorizing the conduct of a separate regular business by Airline, but as permitting Airline to perform only such functions as are incidental to the operation of its Air Transportation Business.

J. The servicing by Airline, or by its suppliers of materials, or furnishers of services, of aircraft and other equipment operated by Airline including the provision of line maintenance, or other materials or supplies, in Exclusive Use Space or Preferential Use Space areas or other locations designated by the Executive Director.

K. The right, but not the obligation, to join a consortium to perform certain operations and maintenance, janitorial, and passenger services that are the responsibility of Airline and other airlines.

L. The installation, maintenance, and operation, at Airline’s sole expense, of identifying signs, posters, graphics and frequent flier program advertising on Airline Premises, subject to the prior written approval of the Executive Director.

Such signs shall be substantially uniform in size, type and location with those of other airlines, consistent with City’s graphic standards and the Airport Rules and Regulations, and in compliance with all laws and ordinances.

M. The installation, maintenance, and operation, at Airline’s sole expense, of such radio, meteorological, and aerial navigation equipment and facilities at suitable locations on the Airport subject to the prior written approval of the Executive Director. The use and location of such equipment and facilities shall not conflict, impede, or otherwise interfere with other similar equipment and facilities on the Airport; and the use and location of such equipment and facilities on the Airport shall be subject to payment of standard rental rates established by City for such use of the Airport.

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N. The installation, maintenance, and operation at Airline’s sole expense, of data and voice transportation, communications equipment (e.g. data, telephone, wireless), network infrastructure components, and support computers with their associated peripherals at suitable locations, as may be necessary or convenient for Airline operations suitable locations on the Airport subject to the prior written approval of the Executive Director. The use and location of such equipment shall not interfere with the use of other similar equipment on the Airport, and the use and location of such equipment on the Airport shall be subject to payment of such nondiscriminatory reasonable fee or charge as may lawfully be established by City for such use of the Airport by Airline.

O. The right to participate in nonexclusive porter services in conjunction with all airlines serving the Airport to assist passengers with luggage.

P. The right to provide curbside baggage check-in service, the location and operation of which shall be subject to the prior written approval of the City, the Airport Rules and Regulations, and the TSA.

Q. The installation of personal property, including furniture, furnishings, supplies, machinery, and equipment, in Airline’s Exclusive Use Space as Airline may deem necessary, useful or prudent for the operation of its Air Transportation Business. Title to such personal property shall remain with Airline, subject to the provisions of this Permit.

R. The construction of modifications, finishes, and improvements in Airline Premises as Airline may deem necessary or prudent for the operation of its Air Transportation Business, subject to the provisions of Section 5.05 of this Permit.

Nothing in this Section 3.02 shall restrict City from requiring a permit and levying a charge on any person or company for conducting business at the Airport.

Furthermore, City intends to levy a charge for such business conducted at Airport, including Airline’s provision of non-Air Transportation services to others, except for ground transportation services provided free of any fee or charge as set forth in Item 1N - Page 138
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Section 3.02 (D) of this Permit.

Limitations on Use of Airport
In connection with the exercise of Airline's rights under this Permit, neither Airline nor any of its agents, employees, directors, officers, contractors, invitees, licensees, or representatives shall:

A. Do anything that may interfere with the effectiveness or accessibility of the drainage and sewage system, electrical system, air conditioning system, fire protection system, sprinkler system, alarm system, fire hydrants and hoses, if any, installed or located on or at the Airport.

B. Conduct a business of any kind at the Airport except its Air Transportation Business or interfere unreasonably with other persons or tenants leasing or lawfully using Airport facilities. Nothing in this Section shall be construed as in any way limiting the general powers of City to fully exercise its statutory functions.

C. Have installed or maintained in, Preferential Use Space, or Joint Use Space amusement machines, vending machines, public pay phones, facsimile, copy machines, or other machines operated by coins, tokens or credit cards unless otherwise approved by the Executive Director.

D. Not do or permit to be done anything, either by act or failure to act, that shall cause the cancellation or violation of the provisions, or any part thereof, of any policy of insurance for the Airport, or that shall cause a hazardous condition so as to increase the risks normally attendant upon operations permitted by this Permit.

If Airline shall do or permit to be done any act not permitted under this Permit, or fail to do any act required under this Permit, regardless of whether such act shall constitute a breach of this Permit, which act or failure, in and of itself, causes an increase in City's insurance premiums, Airline shall immediately remedy such actions.

E. Keep or store, at any time, flammable or combustible liquids except in Item 1N - Page 139
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storage facilities especially constructed for such purposes in accordance with federal, State, and City laws including the Uniform Fire Code and the Uniform Building Code. For purposes of this Permit, flammable or combustible liquids shall have the same definitions as set forth in the most recent Uniform Fire Code.

F. Do anything that may be in conflict with 14 CFR Part 139 or jeopardize the Airport’s FAA issued Operating Certificate.

G. Do anything that may be in conflict with the Airport’s TSA approved Airport Security Plan or violate 14 CFR Part 1542.

Airline Space
A. Airline is hereby assigned Exclusive Use Space, Preferential Use Space, and Joint Use Space as identified in Exhibits B & C of this Permit. On or before the Effective Date, the City will issue to Airline a Premises Notice, that will designate which areas of the Airport, if any, the City will make available for Airline’s use as: (i) Exclusive Use Space, (ii) Preferential Use Space and (iii) Joint Use Space.

B. Airline shall use Exclusive Use Space and Preferential Use Space for office purposes and the sale of Air Transportation, handling, ticketing, billing and manifesting of passengers, baggage, cargo, property and mail in the conduct of its Air Transportation Business or on behalf of any other Air Transportation Company authorized by the Executive Director to use the Airport.

C. Airline shall use its Joint Use Space for purposes designated for such joint use area by the Executive Director.

Employee Parking Facilities
City will make reasonable efforts to make available area(s) at the Airport for vehicular parking for Airline's personnel employed at the Airport; provided, however, such area(s) shall not be used for the long-term storage of vehicles or trailers; and usage of the area(s) is subject to the Airport Rules and Regulations for such parking established by City at rates established by the City. Long-term Item 1N - Page 140
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shall mean periods greater than two (2) weeks. Airline shall, on request of the Executive Director, provide verification that it is only providing parking for its employees employed at Airport.

Access
A. Subject to the terms of this Permit, the Airport Rules and Regulations, and such restrictions as Airline may impose with respect to its Exclusive Use Space, City hereby grants to Airline, its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, and suppliers, the right and privilege of access, ingress and egress to the Terminal Building.

B. The ingress and egress provided for in Section 3.06 (A) shall not be used, enjoyed or extended to any person engaging in any activity or performing any act or furnishing any service for or on behalf of Airline that Airline is not authorized to engage in or perform under the terms of this Permit unless that person is expressly authorized by the Executive Director.

C. The Executive Director shall have the right at any time to close, relocate, reconstruct, change, alter or modify any such means of access provided for Airline’s use pursuant to this Permit or otherwise, either temporarily or permanently, provided that reasonable notice to Airline and a reasonably convenient and adequate means of access, ingress and egress shall exist or be provided in lieu thereof. City shall suffer no liability by reason thereof, and such action shall in no way alter or affect any of Airline’s obligations under this Permit, except to the extent the City violates the terms of this Section 3.06.

RENTALS AND FEES
Airline shall pay to City rentals and fees for use and occupancy of the Airport in the manner set forth in this Article 4 and Exhibit D. Airline acknowledges that the following fees and charges shall be subject to change as deemed necessary by the City and in accordance with the Signatory Airline Agreement.

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Landing Fees
Airline shall pay to City monthly fees based on Aircraft Arrivals for the preceding month. Airline’s Landing Fees shall be determined as the product of the Non-Signatory Landing Fee Rate for the period and Airline’s Total Landed Weight for the month. Airline’s landed weight for the month shall be determined as the sum of the products obtained by multiplying the Maximum Gross Landing Weight of each Airline’s aircraft by the number of landings of each said aircraft during such month.

Baggage Handling System Fees
Throughout the Term of the Permit, Airline shall pay to City Non-Signatory Baggage Handling System Fees.

Loading Bridge Fees
Throughout the Term of the Permit, Airline shall pay to City monthly Loading Bridge Fees.

Terminal Building Rentals
“Terminal Building Rentals” shall be determined as the sum of Airline’s rentals for Exclusive Use Space, Preferential Use Space, Joint Use Space, Per Use Fees – Gates, and Per Use Fees – Ticket Counter. (Per Use Fees shall mean the sum of Per Use Fees – Gates, and Per Use Fees – Ticket Counter ).

A. Airline’s annual Terminal Building Rentals for Exclusive Use Space and Preferential Use Space shall be determined as the Non-Signatory Airline Terminal Building Rental Rate multiplied by the amount of the corresponding type of space leased by Airline as Exclusive Use Space and Preferential Use Space as set forth in Exhibits B and C.

B. Total Terminal Building Rentals for Joint Use Space shall be calculated as the Non-Signatory Airline Terminal Building Rental Rate multiplied by the Item 1N - Page 142
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Airline’s share of the Joint Use Space. Airline’s share of the Joint Use Space shall be determined in accordance with the Joint Use Formula. City shall use Airline’s Monthly Activity Report, to be submitted by Airline to City in accordance with Section 4.05, for purposes of determining charges for Joint Use Space.

C. The amount due by Airline for Per Use Fees shall be calculated as the product of each Non-Signatory Airline Per Use Fee for the applicable period and the number of times Airline used such space. City shall use Airline’s Monthly Activity Report, to be submitted by Airline to City in accordance with Section 4.05, for purposes of determining charges for Per Use Fees.

Monthly Activity Report
Airline shall furnish to the City, on or before the tenth (10th) day of each month, an accurate verified report detailing its operations for the previous month on forms prescribed by the Executive Director. Said report shall include the information presented in Exhibit G and shall be submitted electronically to [email protected]. The acceptance by City of any payment made by Airline shall not preclude City from verifying the accuracy of Airline's report submitted to City as provided in this Section 4.05, or from recovering any additional payment actually due from Airline.

Time of Payment
The following sets forth the time of Airline payments of rents, fees, and charges to City:

A. Rents and fees for Exclusive Use Space and Preferential Use Space shall be due and payable, without invoice, deduction, or setoff, in monthly installments in advance on or before the first day of each month.

B. Landing Fees, BHS Fees, Loading Bridge Fees, Joint Use Fees, Per Use Fees – Gate, Per Use Fees – Ticket Counter, and Non-Terminal Building RON Item 1N - Page 143
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Parking Fees for each month of operations shall be due and payable without deduction or setoff within fifteen (15) days after transmittal of an invoice by City, given that Airline’s monthly statistical report as required in Section 4.05 shall be received by the City within ten (10) days after the last day of the month after such month of operations.

C. Airline shall faithfully collect and promptly remit to City (without notice or demand by City and in accordance with 14 CFR Part 158 (as this regulation may be amended from time to time) the proceeds of the City’s Passenger Facility Charge so long as the City has an approved Passenger Facility Charge in effect.

D. Rents, fees, and charges not described in paragraphs (A), (B), and (C) above shall be due and payable within thirty (30) days after transmittal of a monthly invoice therefore by City. City will provide such invoice within thirty (30) days of activity for which charge is generated.

E. The acceptance of any payment made by Airline shall not preclude City from verifying the accuracy of Airline's report and computations or from recovering any additional payment actually due from Airline or preclude Airline from later demonstrating that Airline's report was inaccurate and that a lesser amount was properly owed (and to recover any such overpayment).

F. In establishing the rents, fees, and charges set forth in this Permit, City is anticipating timely payment of such rents, fees, and charges. Untimely payment of these rents, fees, and charges jeopardizes the operation of the Airport.

Therefore, in the event that rents, fees, and charges are not paid timely by Airline, the Executive Director is authorized and directed to seek any necessary legal and administrative remedy to obtain collection of the unpaid rents, fees, and charges and to assure timely payment of future rents, fees, and charges. These remedies shall be in addition to late fees required herein and may include any of the following:

1. Seeking administrative relief through appropriate federal agencies, including the FAA.

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2. Equitable and judicial remedies.

3. Such other legal and administrative remedies as permitted by law.

G. Failure to send a timely invoice does not relieve Airline from any obligation of payment.

Payments
Rents, fees, and charges shall be paid in United States Dollars by check payable to the City of Palm Springs, and shall be delivered or mailed, postage prepaid, to City of Palm Springs, Palm Springs International Airport (PSP), 3400 E. Tahquitz Canyon Way, Suite 1, Palm Springs, CA 92262.

Passenger Facility Charges
Airline agrees to faithfully collect and promptly remit to City (without notice or demand by City and in accordance with 14 CFR Part 158) the proceeds of the City's PFC so long as the City has an FAA approved PFC in effect. Airline shall pay the City interest for late payment of Passenger Facility Charge proceeds to City in accordance with Section 4.09. Further, both Airline and City hereby covenant to fulfill their responsibilities under the terms of 14 CFR Part 158. If legislation and regulations, in effect on the date of this Permit, governing passenger facilities charges, use fees, or similar charges on Airline’s passengers using the Airport are amended, changed, or eliminated during the term of this Permit, the City reserves the right to appropriately adjust such charges, levy new charges, revise charges, or implement additional charges as determined by the City to be necessary. City may seek PFC funding for PFC eligible projects rather than funding by Airline rates and charges.

Interest on Overdue Payments
In the event that Airline is delinquent for a period of seven (7) calendar days or more from the date when due in paying City any such rentals, fees or charges, Item 1N - Page 145
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and Airline fails to cure any such delinquency within five (5) business days after receiving written notice from City, Airline shall pay City interest thereon, from the date such rents, fees or charges become payable to the date of payment at the rate of one and one-half percent (1.5%) per month; provided, however, that if the maximum rate then provided by law is less than one and one-half percent (1.5%) per month, then the rate shall be such maximum legal rate.

Provision Against Setoffs
It is the obligation of Airline to pay all fees and charges, free of any setoffs or claims, in the amount and at the times specified in this Permit. In the event that Airline desires to contest the validity or amount of any such fees and charges, Airline shall first pay the same to City and may then seek a refund in any appropriate forum.

Contract Security
A. Unless Airline has provided regularly scheduled flights to and from the Airport pursuant to a permit or Signatory Airline Agreement with City for no less than eighteen (18) consecutive months prior to the Effective Date without violating such agreement beyond any applicable cure period, Airline shall provide City with a clean, irrevocable letter of credit, surety bond or other security acceptable to City (“Contract Security”) in an amount equal to City’s estimate of three (3) months’ fees and charges payable by Airline hereunder, to guarantee the faithful performance by Airline of its obligations under this Permit and the payment of all fees and charges due hereunder. The Contract Security shall be in a form and issued by a company reasonably acceptable to City. In the event that any such Contract Security shall be for a period of less than the full period required by this Permit, or if the Contract Security may be canceled, Airline shall provide a renewal or replacement Contract Security at least sixty (60) days prior to the later of: (1) the date the Contract Security expires, or (2) the effective date of cancellation of the Contract Security.

B. The parties acknowledge and agree that any Contract Security provided Item 1N - Page 146
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by Airline will not be considered “property of the estate” for purposes of the United States Bankruptcy Code, it being understood that any Contract Security is property of the third party providing it (subject to City’s ability to draw against the Contract Security) and that all PFCs collected by Airline with respect to Enplaned Passengers at the Airport (other than any portion for Airline’s expenses or that is reimbursable to a ticket purchaser), are property of City.

Payment of Utility Charges
Airline shall pay promptly for all utilities and utility services used by Airline at or in Airline’s Exclusive Use Space or Preferential Use Space in excess of those utility services specifically provided by City. Airline expressly waives any and all claims against City for compensation for any and all loss or damage sustained by reason of any defect, deficiency or impairment of any water supply system, drainage or sewer system, gas supply system, telephone system, electrical supply system, or electrical apparatus or wires serving the Airline Premises.

No Other Fees and Charges
Except as expressly provided for in this Permit, no further rentals, fees, or charges shall be charged against or collected by City from Airline, for the Airline Premises, facilities, rights, licenses, and privileges granted to Airline under this Permit. However, City expressly reserves the right to assess and collect reasonable fees for fuel sales, ground handling services, fuel flowage, fueling services, inflight catering, food/beverage sales, vending, parking, and commercial ground transportation. Also, City expressly reserves the right to assess and collect a Passenger Facility Charge in accordance with Section 4.08.

Anything in this Permit to the contrary notwithstanding, this Section 4.13 shall not be interpreted or understood as contracting away any City governmental authority.

Incorporation of Exhibit D.

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Adjustments to Non-Signatory Airline rates for rentals, fees, and charges shall apply without the necessity of formal amendment of this Permit. Upon each adjustment a revised Exhibit D shall be prepared by the City and submitted to Airline. Said exhibit shall then be deemed part of this Permit without formal amendment thereto.

MAINTENANCE, REPAIR, ALTERATIONS AND IMPROVEMENTS
Designation of Maintenance and Operation Responsibilities In addition to the obligations of Airline and City set forth in this Article 5, responsibilities for maintenance, cleaning, and operation of the Airport shall be as set forth in Exhibit E, attached hereto and made a part hereof. Airline and City agree that the provisions of this Article 5 and Exhibit E in no way void or limit Airline’s right, but not obligation, in conjunction with other airline’s operating at the Airport, to form a consortium to perform certain operations and maintenance, janitorial, and passenger services that are the responsibility of Airline and other airlines in accordance with Section 3.02K.

Airline’s Responsibilities
It is understood and agreed that Airline and City shall have the following maintenance and repair obligations:

A. Airline agrees that by commencing occupancy of all Exclusive Use Space and Preferential Use Space assigned to it pursuant to this Permit, Airline is representing that such space is in good and tenantable condition.

B. Airline shall at its sole expense and in a manner acceptable to the Executive Director:

1. Maintain its Exclusive Use Space in a neat, sanitary, safe, clean, presentable, and orderly condition.

2. Maintain its Preferential Use Space in a neat, clean and orderly Item 1N - Page 148
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condition, free from litter, debris, refuse, petroleum products or grease which result from the activities of its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, or suppliers; including the removal of all oil and grease spillage that is attributable to Airline’s aircraft or equipment.

3. Perform ordinary preventive maintenance and upkeep and nonstructural repair of all facilities located in Exclusive Use Space that is not in Public View.

4. Immediately repair any damage in any other space at the Airport caused by Airline, its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, or suppliers.

C. After written notice and an opportunity for Airline to cure, City may, at the sole discretion of the Executive Director, provide any or all of the above delineated maintenance and repair obligations that are not timely performed by Airline and recover its entire cost plus an administrative charge equivalent to no more than fifteen percent (15%) of the entire cost from Airline as Additional Charges.

City’s Responsibilities
A. City, during the term of this Permit, shall retain FAA Airport Certification in accordance with 14 CFR Part 139 and keep the Airport in reasonably good repair.

B. City shall equip, furnish, and decorate the areas in Public View of the Terminal Building except for Airline baggage service offices.

C. City shall provide and supply Airline’s Exclusive Use Space heat, electricity, air conditioning, wastewater disposal, water, pest control and access to trash and recycling receptacles.

D. City shall provide and supply to the areas in Public View of the Terminal Item 1N - Page 149
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Building heat, electricity, light, air conditioning, wastewater disposal, water, and janitorial services, including trash removal and recycling receptacles. Interruptions of services shall not constitute a breach of this Permit by City, but City shall use its best efforts to restore such service after interruption.

E. The undertakings by City under this Section 5.03 do not relieve Airline of its duties to maintain all Airline Premises (as set forth in this Permit, including Exhibit E) and to use Joint Use Space with due care.

City’s Right to Inspect and Make Repairs
City, by its officers, employees, agents, contractors, subcontractors and other representatives, shall have the right, at such times as may be reasonable under the circumstances, and after reasonable notice (except in the case of an emergency) to enter Airline’s Exclusive Use Space, Preferential Use Space and Joint Use Space for the following purposes:

A. To inspect such space to determine whether Airline has complied and is complying with the terms and conditions of this Permit.

B. To exercise its governmental functions relating to the public health, safety, good conduct and the proper management of the Airport.

C. To accomplish repairs or replacements by City required of City by Section

5.03, or in any case where Airline is obligated to make repairs or replacements and has failed to do so, after reasonable notice, make such repairs or replacements on Airline’s behalf.

D. In the exercise of City’s right to inspect, no such entry by or on behalf of City upon any Exclusive Use Space, Preferential Use Space and Joint Use Space leased to Airline shall be deemed to constitute an interference with the possession and quiet enjoyment thereof by Airline.

Alterations and Improvements
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A. No improvements, alterations or additions including, but not limited to, repainting, redecorating, and re-carpeting shall be made in or about Airline’s Exclusive Use and Preferential Use Space by Airline without first obtaining written consent of City. All such improvements, structure, alterations, additions and work shall be in full accordance with all written conditions prescribed by the City. Prior to the construction of any improvements, Airline shall submit to City for review and approval, the plans of such improvements, including the color of all paint and carpet.

Such plans shall conform to the general architectural scheme and overall plans adopted by the City for the Terminal Building.

B. Upon approval by the City of Airline’s plans as required in Section 5.05.A, Airline shall cause the construction called for by said plans to be commenced and completed with reasonable dispatch. Upon completion of any improvement, Airline shall furnish to City, at no charge, a complete set of working drawings of the improvement as constructed in a form and manner required by City.

C. All improvements, alterations, or additions constructed by Airline in the Airline’s Premises, including the plans and specification therefor, shall conform in all respects to the applicable statutes, ordinances, building code, rules and regulations of the City of Palm Springs and such other governmental authority as may have jurisdiction at the Airport. City’s approval, as provided for in this Section

5.05, shall not constitute a representation or warranty as to such conformity which shall remain Airline’s responsibility. Airline, at its own cost and expense, shall procure all permits necessary for such construction.

D. All renovation or construction by Airline pursuant to this Section 5.05 shall be at Airline’s sole cost and expense. Airline shall keep its Airline Premises, and the improvements constructed thereon, free and clear of all liens and shall pay all costs for labor and material arising out of such construction and shall hold City harmless from any liability in respect thereto. Airline shall have the right to contest any and all liens filed against its Airline Premises. Airline further agrees that City shall have the right to post notices of non-responsibility as provided by Sections Item 1N - Page 151
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3094 and 3129 of the Civil Code of the State of California.

E. Airline shall make no structural alterations to the roof, walls, or floors of any permanent structures in which Airline’s Premises are located without first obtaining City’s written consent.

F. Any and all improvements, alterations, or additions erected or installed by Airline upon the Airline’s Premises shall become a part of the land on which they are erected and title thereto shall thereupon vest in City upon the expiration or sooner termination of this Permit.

G. Airline shall be financially responsible for, and shall indemnify and hold City harmless from, damage to the Terminal Building caused by Airline, its officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, or suppliers. In the event that Airline fails to timely repair any such damage, the City, after reasonable written notice to Airline, may repair such damage on Airline’s behalf, and the City may recover its entire cost plus a reasonable administrative charge (not to exceed fifteen percent (15%) of the entire cost) from Airline as Additional Charges.

H. Airline acknowledges Airline’s Premises are located within a public building and, as such, any improvements, alterations, or additions constructed by Airline may be subject to payment of prevailing wage under the provisions of the California Labor Code. To the extent any such work is subject to prevailing wage requirements, the following shall apply:

1. Airline shall and shall cause its contractors and subcontractors to pay prevailing wages in the construction of any such improvements, alterations or additions as those wages are determined pursuant to Labor Code Sections 1720 et seq.; to employ apprentices as required by Labor Code Sections 1777.5 et seq.; and comply with the other applicable provisions of Labor Code Sections 1720 et seq., 1725.5, 1771, 1771.1, 1771.4, 1776, 1777.5 et seq., 1810-1815 and the Item 1N - Page 152
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implementing regulations of the Department of Industrial Relations (the “DIR”) for all such Labor Code sections.

2. Airline shall indemnify, hold harmless and defend to the extent permitted by law, City, its councilmembers, commissioners, officials, employees, and agents, against any claim for damages, compensation, fines, penalties, or other amounts arising out of the failure or alleged failure of Airline, or its consultants, subconsultants, contractors or subcontractors to pay prevailing wages as determined pursuant to Labor Code Sections 1720 et seq., to hire apprentices in accordance with Labor Code Sections 1777.5 et seq., or to comply with the other applicable provisions of Labor Code Sections 1720 et seq., 1725.5, 1771, 1771.1, 1771.4, 1776, 1777.5 et seq., 1810-1815 and the implementing regulations of the DIR in connection with any improvements, alterations, or additions constructed by Airline. The provisions of this Section shall survive termination of this Permit.

DAMAGE OR DESTRUCTION, INSURANCE, INDEMNIFICATION AND

RELEASE OF LIABILITY
Damage or Destruction
Airline shall promptly repair or replace any property of the City damaged or destroyed by the Airline operations hereunder. Airline shall not install any fixtures or make any alterations or improvements in or additions or repairs to any property of the City except with the prior written approval of the City’s Executive Director.

Insurance
A. By use and occupancy of the Airport, Airline understands and agrees that it shall, at its expense purchase and maintain or cause to maintain in force the following insurance coverage for itself and its officers, agents, employees passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees and suppliers. Airline shall maintain in full force and effect the forms of Item 1N - Page 153
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insurance specified under this Section 6.02.

All such insurance hereunder shall be maintained with insurance underwriters who have a Best’s Key Rating Guide/Property-Casualty/United States or www.ambest.com or an equivalent financial strength rating from the S&P, Moody’s, or Fitch.

All liability insurance policies shall provide coverage which includes, or has the same substantive effect as, the following wording:

1. The City of Palm Springs, its governing Board and each of its officers, directors, officials, employees, and authorized agents and volunteers, (collectively, “City Additional Insureds”), in their respective capacities as such, shall be included as additional insureds hereunder as respects to liability caused, in whole or in part, by the acts or omissions of Airline, or the acts or omissions of those acting on behalf of Airline; or premises owned, occupied or used by Airline in conjunction with work or services provided by Airline to the extent of the named insured’s obligations under its Permit with the City of Palm Springs. Such required liability policy shall contain a Severability of Interest (Cross Liability) clause which states “It is agreed that the insurance afforded by these policies shall apply separately to each insured against whom a claim is made or a suit is brought with respect to the limits of the Airline’s liability.

2. It is agreed that this insurance policy shall apply as primary and any insurance or self-insurance as may be maintained by the City of Palm Springs, its governing Board, officers, directors, officials, employees, and authorized agents and volunteers shall apply in excess of and shall not contribute with insurance provided by this policy.

3. This insurance shall not be materially changed, altered, canceled, or non-renewed until after thirty (30) days advance written notice has Item 1N - Page 154
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been given to the City of Palm Springs. Ten (10) days advance written notice shall be given to the City of Palm Springs in the event of cancellation of this insurance due to non-payment of premiums by Airline and seven (7) days, or such lessor period, as may be customary, advance written notice shall be given to the City of Palm Springs in the event of cancellation due to war and associated perils.

Prior to the effective date of this Permit, Airline shall furnish City with evidence of all insurance policies. Prior to the expiration of any then-current policy of insurance, Airline shall deliver to City evidence showing that such insurance coverage has been renewed. At least five (5) calendar days prior to the date of cancellation or reduction of coverage, as received in the written notice from the insurer, Airline shall deliver to the Executive Director evidence showing reinstatement or other provision for the required insurance.

All such evidence shall be in the form of certificates of insurance reasonably satisfactory to the Executive Director, accompanied by a copy of an endorsement, if applicable, to each policy containing the language required by Section 6.02(A) and, if applicable, cross liability coverage shall be in the following amounts:

B. Aircraft liability insurance and comprehensive form airline liability or airport liability insurance, covering bodily injury, personal injury, property damage, products/completed operations liability, premise liability, and contractual liability specifying this Permit, with a liability limit of not less than three hundred million dollars ($300,000,000) combined single limit per occurrence. Said limit shall be reduced to $150,000,000 where Airline’s maximum seating capacity on any airplane operated by Airline is thirty (30) or less. With respect to coverage for products/completed operations and personal injury, except with respect to passengers, a sublimit of not less than twenty five million dollars ($25,000,000) per occurrence, and in the annual aggregate, shall be permitted. Said aircraft liability Item 1N - Page 155
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shall be applicable to owned, non-owned, and hired aircraft.

C. Automobile liability insurance with a liability limit of not less than five million dollars ($5,000,000) for all owned, non-owned, and hired vehicles operated by or on behalf of Airline on the Airport, including any additional or replacement vehicles.

D. Liquor liability insurance for Airline serving alcoholic beverages in an amount not less than ten million dollars ($10,000,000) per occurrence.

E. Employer’s liability insurance in an amount not less than one million dollars ($1,000,000) per occurrence.

F. Airline shall likewise maintain workers’ compensation insurance or evidence of self-insurance, if applicable, in accordance with the laws of the State of California, covering all its employees who may from time to time be at the Airport in such capacity. Airline shall require each of its agents, licensees, subcontractors, and suppliers of the Airline Premises to maintain such workers’ compensation insurance covering their employees coming on the Airport in connection with Airline’s operations hereunder. The workers’ compensation policy(s) required hereunder shall be endorsed to state that the workers’ compensation carrier waives its right of subrogation against the City of Palm Springs, its governing Board, officers, directors, officials, employees, and authorized agents and volunteers.

Upon request by the Executive Director, Airline shall furnish the Executive Director with a certificate of insurance of such workers’ compensation insurance in a form reasonably acceptable to City.

G. Pollution coverage sufficiently broad enough to respond to bodily injury or property damage resulting from Airline abnormal operations with a limit not less than $5,000,000 on an occurrence basis. This policy can be provided either by endorsement to the Aviation Liability Coverage in Section 6.02.B. or by a separate policy.

H. The parties understand and agree that the minimum limits of the Item 1N - Page 156
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insurance herein required may become inadequate during the term of this Permit, and Airline and City agree that each will increase such minimum limits by reasonable amounts on request of the Executive Director with concurrence of City Risk Manager.

I. The City, at its sole option, may immediately terminate this Permit should Airline fail to obtain or maintain in force the insurance required herein.

J. If any claim for damages is filed with Airline or if any lawsuit is instituted against Airline, Airline shall give prompt and timely notice thereof to the Executive Director, provided that claims and lawsuits subject to such notice are only those that arise out of or are in any way connected with Airline’s or its officers’, representatives’, agents’, employees’, passengers’, guests’, patrons’, contractors’, subcontractors’', licensees’, subtenants’, invitees’, or suppliers’ use of the Airline Premises or Airline's operations or activities in regard to the Airport and that in any way, directly or indirectly, contingently or otherwise, affect or might reasonably affect City. Notice shall be deemed prompt and timely if given within thirty (30) calendar days following the date of receipt of a claim or ten (10) calendar days following the date of service of process of a lawsuit. Accident or property damage claims in an amount less than ten thousand dollars ($10,000) shall be excluded from the requirements of this Section 6.02.J.

K. If any claim for damages is filed with City or if any lawsuit is instituted against City, City shall give prompt and timely notice thereof to Airline, provided that claims and lawsuits subject to such notice are only those that arise out of or are in any way connected with the operation of the Airport by City and that in any way, directly or indirectly, contingently or otherwise, affect or might reasonably affect Airline. Notice shall be deemed prompt and timely if given within thirty (30) calendar days following the date of receipt of a claim or ten (10) calendar days following the date of service of process of a lawsuit. Accident or property damage claims in an amount less than ten thousand dollars ($10,000) shall be excluded from the requirements of this Section 6.02.K.

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L. In the event Airline chooses to provide self-insurance to satisfy any requirements of this Section, Airline shall submit to City for approval all selfinsurance retentions (SIR) to be declared by Airline. The City may require Airline to purchase insurance coverage with a lower retention or provide a Certificate of Insurance evidencing the existence of such insurance coverage to pay losses and related investigations, claim administration, and defense expenses within the retention. Any and all deductibles and SIRs shall be the sole responsibility of Airline and shall not apply to the City Additional Insureds.

Indemnification
To the fullest extent permitted by law, Airline shall indemnify, defend and hold harmless the City of Palm Springs, its governing Board, officers, directors, officials, employees, and authorized volunteers and agents, (collectively “Indemnified Parties”), from and against any and all claims, demands, actions, losses, liabilities, damages, and all expenses and costs incidental thereto (collectively “Claims”), including cost of defense, settlement, arbitration, and reasonable attorneys’ fees, sustained by any person or to any property in, on, or about the Airport, or Airline Premises used or occupied by Airline for Airline’s operations or activities resulting from injuries to or death of persons, including but not limited to employees of either party hereto, and damage to or destruction of property or loss of use thereof, including but not limited to the property of either party hereto, arising out of, pertaining to, or resulting from the acts or omissions of the Airline, its officers, directors, officials, employees, volunteers, agents, representatives, contractors, subcontractors invitees, passengers, guests, subtenants and suppliers, excepting only such injury, death or damage to the extent it is caused by the negligence of one or more of the Indemnified Parties.

Airline shall not be liable for any Claims arising from the sole negligence or willful misconduct of one or more of the Indemnified Parties where such indemnification would be invalid under Section 2782 of the Civil Code
This indemnity shall not be limited by the types and amounts of insurance Item 1N - Page 158
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or self-insurance maintained by the Airline.

Nothing in this Indemnity shall be construed to create any duty to, any standard of care with reference to, or any liability or obligation, contractual or otherwise, to any third party.

The provisions of this indemnity shall survive the termination or expiration of this Permit.

Release of Liability Regarding Certain Damages
A. City shall not be liable for, and is hereby released from, all liability to Airline, Airline’s insurance carrier, or anyone claiming under or through Airline for bodily injury or any loss or damage to real or personal property occasioned by flood, fire, earthquake, lightning, windstorm, hail, explosion, terrorism, riot, strike, civil commotion, military confrontation, smoke, vandalism, malicious mischief, acts of civil disobedience, acts of civil authority, forfeiture, or any other cause beyond City’s control.

B. City shall not be liable for, and is hereby released from all liability to Airline, Airline’s insurance carrier, or anyone claiming under or through Airline for any loss or damage whatsoever to the property or effects of Airline resulting from the discharge of water or other substances from pipes, sprinklers, or conduits, containers or appurtenances thereof or fixtures thereto, or for any damage resulting from the discharge or failure of electric current, regardless of cause or origin, except for such damage as may be caused by reason of the negligence of City, its employees or agents.

ENVIRONMENTAL COMPLIANCE
Definitions
The following definitions shall apply as used in this Article 7:

A. “Environmental Laws” shall mean all present and future federal, state, Item 1N - Page 159
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and local statutes, regulations, ordinances, permits, codes, orders, limitations, restrictions, or prohibitions of any governmental authority, including City codes and orders, relative to the occupancy and use of the Airline Premises, the Airport and Airfield Area regarding the environment, including, without limitation, Pollutants, wetlands, waters of the United States, areas inhabited by Endangered, Threatened, or Sensitive Species, the protection of the environment, public health, welfare or safety, including, without limitation, those related to Pollutants (as such terms are defined herein).

B. “Endangered, Threatened and Sensitive Species” shall mean any flora or fauna identified by the provisions of the California Endangered Species Act (California Fish and Game Code §2050, et seq.), the Federal Endangered Species Act (16 U.S.C. §§1531-1543), and the Federal Migratory Bird Treaty Act (16 U.S.C. §§703-712) on the Airport.

C. “Hazardous Material” shall mean any substance whether solid, liquid, or gaseous in nature:

1. the presence of which requires investigation or remediation under any federal, state or local statute, regulation, ordinance, order or common law; or

2. which is or becomes defined as a hazardous waste, hazardous substance, pollutant or contaminant under any federal, state, or local statute, regulation, rule, or ordinance, or amendments thereto, including, without limitation, the following: (a) Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. §§9601-9675); (b) Resource Conservation and Recovery Act (42 U.S.C. §§6901-6992); (c) Clean Air Act (42 U.S.C. §§7401-7642); (d) Clean Water Act (33 U.S.C. §§1251-1387); (e) state and federal regulations relating to storm water discharges, including without limitation, 40 CFR Part 122; or

3. the presence of which on the Airport causes or threatens to cause Item 1N - Page 160
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a nuisance upon the Airport or to adjacent properties or poses or threatens to pose a hazard to the health or safety of persons on or about the Airport; or

4. without limitation, which contains gasoline, diesel fuel, other petroleum hydrocarbons, natural gas, liquids, polychlorinated biphenyls (PCBs), asbestos, or lead-based paint; or

5. defined as a “Hazardous Waste” or “Extremely Hazardous Waste” or “Restricted Hazardous Waste” under Sections 25115, 15117 or 25122.7 or listed pursuant to Section 25140 of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law); or

6. defined as a “Hazardous Substance” under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.8 (CarpenterPresley-Tanner Hazardous Substance Account Act); or

7. defined as a “Hazardous Materials” or “Hazardous Substance” or “Hazardous Waste” under Section 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory); or

8. defined as a “Hazardous Substance” under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances); or

9. including petroleum; or

10. including asbestos; or

11. listed under this Article 7 or defined as “Hazardous Wastes” or “Extremely Hazardous” pursuant to Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20; or
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12. designated as a “Hazardous Waste” pursuant to Section 311 of the Federal Water Pollution Control Act (33 U.S.C. Section 1317); or

13. defined as a “Hazardous Waste” pursuant to Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. (42 U.S.C. Section 6903); or

14. defined as a “Hazardous Substance” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq. (42 U.S.C. Section 9601).

D. “Process Water” shall mean water which contains Hazardous Material or Solid Waste from any point or non-point source subject to the Clean Water Act, amendments thereto, and regulations promulgated pursuant thereto, including without limitation, requirements of the National Pollution Discharge Elimination System Program and the State of California Porter-Cologne Water Quality Control Act.

E. “Pollutants” shall mean Hazardous Materials, Solid Wastes, and Process Waters (as such terms are defined herein).

F. “Release” shall mean any depositing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing into the environment, regardless of intent.

G. “Solid Waste” shall have the same meaning as in the Resource Conservation and Recovery Act and shall include sewage.

Duty to Comply with Environmental Laws
Airline shall, relative to its occupancy and use of the Airline Premises, the Airport, and the Airfield Area, comply with all Environmental Laws.

Liability and Responsibility for Corrective Action
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Airline shall be liable and responsible for any Release of Pollutants arising out of the Airline’s occupancy or use of the Airline Premises, or Airport, or Airfield Area, which is caused by Airline, or its employees, agents, representatives, or Affiliates (hereinafter “Airline Release”). Liability and responsibility for such Airline Releases shall include, but not be limited to:

A. all immediate actions reasonably necessary under Environment Laws to promptly control any such Airline Release and to mitigate any immediate threat to public health, safety, and the environment resulting from such Airline Release; B. any further repairs or corrective actions, conducted in a timely manner, reasonably necessary under Environmental Laws to remediate the Airline Release and to protect public health, safety, and the environment, and to bring the affected areas on or outside the Airline Premises, or Airport, or Airfield Area into compliance with Environmental Laws and other applicable regulatory requirements; C. damages to persons, property and the Airline Premises, or Airport, or Airfield Area resulting from such Airline Release;
D. all claims resulting from those damages;
E. fines imposed by any governmental agency to the Airline Release, and F. any other liability as provided by law.

If Airline causes, or permits the use or storage of Hazardous Materials resulting in a release of Pollutants on the Airport, then Airline shall indemnify, defend and hold harmless City, its governing Board, officers, directors, officials, employees, and authorized volunteers and agents, (collectively “Indemnified Parties”) from and against, any and all claims, demands, actions, judgments, damages, penalties, fines, costs, liabilities or losses, and all expenses and costs incidental thereto (collectively “Claims”) including cost of defense, settlement, arbitration and reasonable attorneys’ fees, which arise during or after the term of this Permit as a result of such a Release of Pollutants . This indemnification of City Item 1N - Page 163
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by Airline includes, without limitation, costs incurred in connection with any investigation of site conditions or any clean up, remedial, removal or restoration work required by any Federal, State or local governmental agency or political subdivision because of Hazardous Material present in the soil or ground water on or under the Airport, excepting pre-existing conditions. Without limiting the foregoing, if the presence of any Hazardous Material caused or permitted by Airline results in any Release of Pollutants, Airline shall promptly take all actions at its sole expense as are necessary to render the Airport in compliance with all Environmental Laws; provided that City’s approval of such actions shall first be obtained, which approval shall not be unreasonably conditioned, delayed, or withheld so long as such actions would not potentially have any material adverse long-term or short-term effect on the Airport. City shall have a direct right of action against Airline to enforce this provision.

Right to Inspect and Test
The City, or its designated representatives, may at any time during the term of this Permit enter upon the Airline Premises and make any inspections, assessments, investigations, audits, tests or measurements City deems reasonably necessary, including boring into surfaces or the ground, in order to determine if a Release of Pollutants has occurred. City shall give Airline a minimum of forty-eight (48) hours’ notice in writing prior to conducting any inspections or tests, unless, in City’s reasonable judgment, based on significant release of hazardous materials or other emergency situation, circumstances require otherwise, and such tests shall be conducted in a manner so as to minimize any inconvenience and disruption to Airline's operations. If such tests indicate a Release has occurred, then City will confer with the airline to determine the party responsible for such Release. If the Airline is determined to be the responsible party the City may require Airline, at Airline's expense, to have tests for such Pollutants conducted by a qualified party or parties on the Airline Premises, or Airport, or Airfield Area, as required by Environmental Law. If Pollutants that originated from an Airline Release have impacted any area outside the Airline Item 1N - Page 164
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Premises, including but not limited to surface, subsurface, surface water, and groundwater, then City, at City’s reasonable discretion, may require Airline, at Airline’s expense, to have tests for such Pollutants conducted by a qualified party or parties on said area outside the Airline Premises, or Airport, or Airfield Area as required by Environmental Laws.

Duty to Furnish Information
At the reasonable written request of the City in advance, Airline shall make available for inspection and copying any or all non-privileged substantive documents and materials that Airline possesses associated with Airline’s operations at or occupancy or use of the Airline Premises, or Airport, or Airfield Area by Airline, including without limitation any and all associated records, test results, studies or other documentation regarding environmental conditions relating to Airline’s use, storage, or treatment of any Hazardous Materials or Solid Wastes or Process Waters.

Immediately upon receipt by Airline (and in no event later than five (5) business days after receipt), Airline shall provide the City with copies of any notice or other document issued to Airline (or any employee, agent, contractor, sublessee, or any other third party under Airline’s direction or control) by any governmental agency alleging non-compliance or investigating potential noncompliance with any Environmental Laws (i) arising out of the occupancy or use of the Airline Premises, or Airport, or Airfield Area by Airline, or (ii) at the Airport and alleged to have arisen in whole or in part from Airline operations, activities, actions or omissions of Airline or third parties under Airline’s direction or control.

At the request of the City (but in no event more than thirty (30) days after such request), the Airline shall provide the results of any tests conducted by Airline or Airline’s qualified party at the Airline Premises, the Airport or Airfield Area, including but not be limited to, comprehensive soil, emission, material, Process Water, surface water or groundwater sampling and testing or other procedures to determine any actual or possible Release of Pollutants.

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Airline shall report such known or identified Releases to City within seventytwo (72) hours. If (i) such Releases are determined to be an Airline Release, and (ii) necessary to determine compliance with Environmental Laws, Airline shall diligently proceed to identify the horizontal and vertical extent of the Release, how it will be controlled or mitigated or remediated as required by Environmental Law(s), when and by whom it will be controlled or mitigated or remediated, and the cost of such corrective actions. By way of clarification, the above requirements shall not apply to the extent that a Release of Pollutants.

If Airline provides privileged or confidential materials to City, City agrees to not disclose such materials unless required by law. To the extent that the Airline is subject to disclosure requirements under the California Public Records Act (Govt.

Code § 6250 – 6276.48) or other federal, state, and local public record laws (collectively, “the Disclosure Laws”), the following additional terms apply:

In the event the City receives a request for disclosure of such information or disclosure under the Disclosure Laws, then City will provide Airline with reasonable prior notice, and in no case less than ten (10) days’ notice, of the request prior to disclosing the information or documentation. If Airline claims the information or documentation is exempt from disclosure under the Disclosure Laws, it must obtain a protective order, injunctive order, or other appropriate remedy from a California court of law before the City’s deadline for responding to the request. If Airline fails to obtain such judicial relief within that time, the City may disclose the requested information without any penalty or liability to Airline.

Term of Environmental Provisions
The provisions of this Article, including the representations, warranties, covenants and indemnities of Airline, shall expressly survive termination of this Permit and Airline’s obligations and liabilities under this Article shall continue so long as City bears any liability or responsibility under the Environmental Laws arising from Airline’s occupancy or use of the Airline Premises, or Airport, or Airfield Area during the term of this Permit.

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Sustainability
Airline shall, relative to its occupancy and use of the Airline Premises, the Airport, and the Airfield Area, comply with all Environmental Laws, and where appropriate, will work collaboratively with the City to help meet the City’s sustainability initiatives.

ASSIGNMENT
Assignment and Sublease
Airline shall not at any time sublet, assign, transfer, convey, mortgage, pledge, or encumber its interest under this Permit, or any part of the leased space, to any party other than a wholly owned subsidiary of Airline, to any Airline Transportation Company under the same control as the parent company of Airline, or corporation with which Airline may merge or consolidate, without prior written approval of the City.

RULES AND REGULATIONS, COMPLIANCE WITH LAW,

NONDISCRIMINATION
Covenant Against Discrimination.

A. In connection with its performance under this Permit, Airline agrees to comply with pertinent statutes, Executive Orders and such rules as are promulgated to ensure that no person shall, because of actual or perceived race, religion, color, sex, age, marital status, ancestry, national origin ( i.e., place of origin, immigration status, cultural or linguistic characteristics, or ethnicity), sexual orientation, gender identity, gender expression, physical or mental disability, or medical condition (each a “prohibited basis”), be excluded from participating in any activity conducted with or benefiting from Federal assistance. If Airline transfers its obligation to another, the transferee is obligated in the same manner as the Airline. This provision obligates the Airline for the period during which the Airline, or its successor, operates at the Airport and the City remains obligated to the Federal Aviation Item 1N - Page 167
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Administration. This provision is in addition to that required by Title VI of the Civil Rights Act of 1964.

B. Airline shall ensure that applicants are employed, and that employees are treated during their employment, without regard to any prohibited basis. As a condition precedent to City’s lawful capacity to enter this Permit, and in executing this Permit, Airline certifies that its actions and omissions hereunder shall not incorporate any discrimination arising from or related to any prohibited basis in any Airline activity, including but not limited to the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship; and further, that Airline is in full compliance with the provisions of Palm Springs Municipal Code Section 7.09.040, including without limitation the provision of benefits, relating to non-discrimination in City contracting.

C. Airline further represents and warrants to City that as a condition of the use of Airport services and facilities, Airline shall comply with all applicable provisions of the Federal Nondiscrimination requirements set forth in Exhibit H.

Airport Rules and Regulations
A. City, in its governmental capacity, has adopted and will enforce the Airport Rules and Regulations which are the laws, rules, regulations, policies, and other written guidance documents respecting the occupancy and use of the Airport, its services, and facilities by persons, vehicles, aircraft, and equipment that in the City’s opinion will reasonably ensure the safe, efficient, and economically practicable operation of the Airport and provide for the safety and convenience of those using the Airport, and to protect the Airport and its facilities and the public from damage or injury resulting from operations on, into, and from the Airport.

B. Airline shall observe and obey all Airport Rules and Regulations. City agrees that its Airport Rules and Regulations shall not be inconsistent with the express terms of this Permit or any law, regulation or directive of the FAA or of any Item 1N - Page 168
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other federal or State agency. Copies of the Airport Rules and Regulations, as promulgated, shall be made available to Airline’s local manager by the Executive Director. City shall provide Airline with reasonable notice prior to adoption of any new or amended Rules or Regulations in order to provide Airline with the opportunity to comment on same prior to adoption. Airline, upon written request to the Executive Director, shall be furnished (at the notice address provided herein and to Airline's on-Airport manager) a current version of any such Airport rules or regulations and any amendments thereto.

C. Airline shall take all reasonably necessary steps to ensure that its officers, agents, employees, representatives, contractors, subcontractors, licensees or invitees fully comply with all Airport Rules and Regulations.

D. City shall prescribe penalties and injunctive remedies for violations of the Airport Rules and Regulations, and these penalties and injunctive remedies may be applied by the Executive Director to Airline for violations by any of Airline's officers, representatives, agents, employees, passengers, guests, patrons, contractors, subcontractors, licensees, subtenants, invitees, or suppliers.

Compliance with Law
Airline shall not, in connection with any of its activities or operations, use any of the Airport’s facilities or permit the same to be used by any of its officers, representatives, agents, employees, contractors, subcontractors, licensees, subtenants, invitees, or suppliers for any illegal purpose and shall:

A. Comply with all applicable ordinances, laws, and rules and regulations of any city, City, state, federal government or agency that has jurisdiction to pass laws or ordinances or to make and enforce rules and regulations governing conduct on and operations at the Airport and the use of its facilities.

B. Strictly comply with existing or future Department of Homeland Security – TSA rules, regulations or requirements, including but not limited to the TSA approved Airport Security Program, 49 CFR Part 1542, directives issued by the Item 1N - Page 169
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Executive Director relating to Airport security, or other regulations concerning Airport security
C. Make, at its own expense, all nonstructural improvements, repairs and alterations to its Exclusive Use Space, Preferential Use Space, equipment, and personal property that are required to comply with or conform to any of such laws, ordinances, and the rules and regulations referred to in Section 9.02.

D. Reimburse City for a pro rata portion of all nonstructural improvements, repairs and alterations that are required to comply with or conform to any of such laws, ordinances and rules and regulations referred to in Section 9.02.

E. Be and remain an independent contractor with respect to all installations, construction and services performed hereunder by or at the request of City.

Amendment Required by FAA
This Permit may be amended without further consideration for the purpose of complying with FAA requirements.

Assurances Required By FAA
Airline will, at all times during this Permit, comply with the applicable provisions of the FAA’s “Airport Sponsor Assurances” (Assurances) and any subsequent revisions, updates, or amendments thereto. City is not responsible for notifying Airline of any changes to the Assurances. Airline is required to contact the FAA for any updates or revisions. The Airline shall include compliance with these Assurances in all other agreements it enters into with third parties, pertaining to, referencing or otherwise related to activities regarding the Airline Premises. The Assurances document is available on the FAA’s website.
14 CFR Part 382 Boarding Assistance for Aircraft Compliance Airline, when required by 14 CFR Part 382 or any other laws, rules or applicable regulations now or hereafter adopted by federal or state governments, Item 1N - Page 170
Non-Signatory Airline Operating Permit 46
shall provide certain facilities for the movement of passengers with disabilities while enplaning and deplaning its aircraft. To the extent required by law, Airline shall be responsible for acquiring or making arrangements for the use of boarding assistance devices, when applicable, for its aircraft. Airline shall ensure that all lifts and other accessibility equipment used by it are maintained in proper working condition. Airline shall ensure that those personnel involved in providing boarding assistance through the use of lifts or other accessibility equipment are properly trained in the use and operation of the devices and appropriate boarding assistance procedures that safeguard the safety and dignity of passengers.

Airline shall have the right, on a non-exclusive, non-preferential basis with other authorized users thereof, to provide such assistance by utilizing any Cityowned passenger loading ramp in conjunction with its Air Transportation Business at the Airport. Airline shall be solely responsible for providing the personnel necessary to operate the apparatus. Airline’s personnel shall operate such Cityowned apparatus in conformance with all written operating instructions and recommendations promulgated by the manufacturer of the apparatus and shall store the apparatus in a parking location approved by the City. The City shall be responsible for the maintenance and repair of any City-owned apparatus; provided however: (a) City may include the costs associated with such maintenance and repair in the Airfield Cost Center; and (b) Airline shall be obligated to reimburse City for the cost of all repairs necessitated by Airline’s negligent operation of the apparatus, or operation of the apparatus by the Airline contrary to manufacturer’s written instructions and recommendations. Airline shall hold City and its employees and officers harmless from, and indemnify against, any claims for personal injury, property damage, or consequential losses, subject to policy terms, conditions, limitations and exclusions, that might be brought by Airline, and of Airline’s officers, directors, agents, representatives, or employees, or by any third party whomsoever, stemming from the Airline’s use or operation of the apparatus; provided, however, that Airline shall not be obligated to hold City, its employees, and officers harmless from, or to indemnify against, any claim based upon the City’s, its employee’s officers, contractors or another Air Transportation Item 1N - Page 171
Non-Signatory Airline Operating Permit 47
Company’s negligence or negligent maintenance or repair of the apparatus.

NOTICES
Delivery of Notices
Any notice given under the provision of the Permit shall be in writing and shall be delivered personally or sent by certified or registered mail, postage prepaid addressed to Airline at the address set forth on Page 1 of this Permit and to the City as follows:

Executive Director and City Manager
Palm Springs International Airport 3200 E. Tahquitz Canyon Way 3400 E. Tahquitz Canyon Way, Suite 1 Palm Springs, CA 92262 Palm Springs, CA 92262
Any such notice or other document shall be deemed to be received as of three (3) days after the date deposited in the mail, if mailed in accordance with this Section.

MISCELLANEOUS
Governing Law
The parties hereto agree that this Permit shall be governed and construed in accordance with the laws of the State of California.

Jurisdiction and Venue
The parties hereto agree that the State of California is the proper jurisdiction for litigation of any matters relating to this Permit, and service mailed to the address of Airline set forth herein shall be adequate service for such litigation. The parties further agree that the state and Federal courts located in Riverside County, California are the proper place for venue as to any such litigation and Airline agrees to submit to the personal jurisdiction of such court in the event of such litigation.

Item 1N - Page 172
Non-Signatory Airline Operating Permit 48
Non-Liability
No member of City Council, an Airport Commissioner, or a director, officer, agent, consultant or employee of the City or Airline shall be charged personally or be held liable by or to the other party under any term or provision of this Permit, or any amendment thereto, or because of any breach hereof, or because of its execution.

Attorneys’ Fees and Costs
In the event any action or suit or proceeding is brought by either party to collect the fees and charges due or to become due hereunder or any portion thereof or to take possession of said Airline Premises or to enforce compliance with this Permit for failure to observe any of the covenants of this Permit, and such party is the prevailing party in such action, suit or proceeding, the losing party agrees to pay such sums as the Court may judge reasonable attorneys’ fees and costs to be allowed in said suit, action or proceeding.

Noninterference with Operation of the Airport
Airline, by accepting this Permit, expressly agrees for itself, its successors and assigns that it will not make use of the Airline Premises in any manner that might interfere with the landing and taking off of aircraft at the Airport or otherwise constitute a hazard. In the event the aforesaid covenant is breached, upon reasonable notice to Airline and opportunity to cure, City reserves the right to enter into the Airline Premises hereby leased and cause the abatement of such interference at the expense of Airline.

Quiet Enjoyment
Airline shall, upon payment of the rentals and fees as herein required, and subject to performance and compliance by Airline of the covenants, conditions and agreements on the part of Airline to be performed and complied with hereunder, peaceably have and enjoy the rights, uses and privileges of the Airport, its Item 1N - Page 173
Non-Signatory Airline Operating Permit 49
appurtenances and facilities as granted hereby and by the Airport Rules and Regulations.

Taxes
A. Under this Permit, a possessory interest subject to property taxation may be created. Notice is hereby given pursuant to California Revenue and Taxation Code, Section 107.6, and Government Code Section 53340.1, that Airline’s interest may be subject to property taxation and special taxation pursuant to The Mello Roos Community Facilities Act of 1982 (Chapter 2.5, commencing with Section 5331, of Part 1 of , Division 2 of Title 5 the California Government Code), (Mello Roos Community Facilities Act of 1982) and that Airline may be subject to the payment of property taxes and special taxation levied on such interest.

B. Airline shall pay, but such payment shall not be considered part of Airport Revenue, all taxes (including any possessory interest tax), assessments and charges of whatever character which at any time during the term of this Permit may be levied against Airline or become a lien by virtue of any levy, assessment or charge against Airline by federal, State and any other public agency, including the City, with respect to: (1) any of the space leased under this Permit or such facilities of the Airport as are made available for use by Airline hereunder; (2) any personal property belonging to Airline situated on the space leased under this Permit; or (3) Airline’s leasehold improvements or operations hereunder. Payment of any such taxes, assessments and charges, shall be made by Airline directly to the taxing or assessing authority charged with collection thereof.

C. On any termination of this Permit, all lawful taxes then levied and all liens upon any such property or taxable interest therein shall be paid in full by Airline forthwith, or as soon as a statement thereof has been issued by the tax collector if termination occurs during the interval between attachment of the lien and issuance of a statement.

Subordination to Agreements with the U.S. Government
Item 1N - Page 174
Non-Signatory Airline Operating Permit 50
This Permit is subject and subordinate to the provisions of any agreements heretofore or hereafter made between City and the United States, relative to the development, operation or maintenance of the Airport, the execution of which has been required as a condition precedent to the transfer of federal rights or property to City for an Airport Purpose, or to the expenditure of federal funds for the improvement or development of the Airport, including the expenditure of federal funds for the development of the Airport in accordance with the provisions of the Federal Aviation Act of 1958, the Federal Aid to Airports Act, the Airport and Airway Development Act of 1970, and the Airport and Airway Improvement Act of 1982, as such acts may have been amended from time to time. City covenants that, to the best of its knowledge, it has no existing agreements with the United States that contain provisions expressly in conflict with the express provisions of this Permit.

In the event that the FAA requires, as a condition precedent to the granting of funds for the improvement of the Airport, modification or changes to this Permit, Airline agrees to consent to such amendments, modifications, revisions, supplements or deletions of any of the terms, conditions or requirements of this Permit as may be reasonably required to enable City to obtain such grant of funds, provided that in no event shall such changes impair the rights of Airline hereunder.

Incorporation of Exhibits
All Exhibits referred to in this Permit are intended to be and hereby are specifically made a part of this Permit.

Affiliate Designation and Requirements
Airline shall furnish City with Exhibit F evidencing current Affiliate(s) for Airline at least five (5) calendar days prior to the Effective Date of this Permit.

Airline shall maintain a current Exhibit F with the City evidencing Affiliate(s) during the Term of this Permit and shall provide at least five (5) calendar days prior written notice to the Executive Director of any changes to Affiliates at the Airport.

Force Majeure
Item 1N - Page 175
Non-Signatory Airline Operating Permit 51
Neither City nor Airline shall be deemed in violation of this Permit if it is prevented from performing any of the obligations hereunder by reason of strikes, boycotts, labor disputes, embargoes, shortage of energy or materials, acts of God, acts of a public enemy, terrorism, acts of superior governmental authority, weather conditions, riots, rebellion, sabotage or any other circumstances for which it is not responsible or which are not within its control, provided these provisions shall not excuse Airline from paying the rentals and fees specified in Article 4.

Headings
The headings of the Articles and Sections of this Permit are inserted only as a matter of convenience and for reference and do not define or limit the scope or intent of any provisions of this Permit and shall not be construed to affect in any manner the terms and provisions hereof or the interpretation or construction thereof.

Remedies
The rights and remedies given to the City and Airline in this Permit are distinct, separate and cumulative, and not one of them, whether or not exercised by either party, shall be deemed to be in exclusion of any of the others herein or by law or in equity provided.

Nonexclusive Rights
It is understood and agreed that nothing herein contained shall be construed to grant to Airline any exclusive right or privilege within the meaning of Section 308 of the Federal Aviation Act for the conduct of any activity on the Airport, except that, subject to the terms and provisions hereof, Airline shall have the right to exclusive possession of the Exclusive Use Space leased to Airline under the provisions of this Permit.

General Interpretation
Insofar as this Permit grants, permits or contemplates the use of space or Item 1N - Page 176
Non-Signatory Airline Operating Permit 52
facilities or the doing of any other act or thing at the Airport by Airline, such use or the doing of such act or thing is to be in connection with the operation of the civil air transportation system by Airline for the carriage by aircraft of persons, property, cargo, baggage, and mail on scheduled or nonscheduled flights, whether as a common carrier, a contract carrier, a private carrier or otherwise. Each of the parties, however, has entered into this Permit solely for its own benefit; and (without limiting the right of either party to maintain suits, actions or other proceedings because of breaches of this Permit) the Permit does not grant to any third person (excepting a successor party to City or Airline) a right to claim damages or bring any suit, action or other proceeding against either City or Airline because of any breach hereof.

Surrender of Possession
Airline agrees to yield and deliver to the City the possession of the Airline Premises including the Airline Premises leased exclusively or preferentially to Airline or jointly to Airline and others, at the termination of this Permit by expiration or otherwise. Such Airline Premises shall be delivered in clean and good condition in accordance with Airline’s express obligations hereunder, except for reasonable wear and tear, fire and other casualty. Airline shall have the right at any time during the term of this Permit, to remove or sell its trade fixtures and equipment situated on the Airline Premises that were installed, or placed by it, at its expense in, on or about the Airline Premises pursuant to the provisions of this Permit subject however to any valid lien that the City may have thereon for unpaid fees or other charges. Any such removal shall be at Airline’s expense and accomplished in a good workmanlike manner. Any damage occasioned by such removal shall be repaired at Airline’s expense so that the Airline Premises may be surrendered in a good, clean and sanitary condition.

Authority of Executive Director
All rights and obligations of City under this Permit may be exercised by the Executive Director or his designee, unless specifically provided otherwise or Item 1N - Page 177
Non-Signatory Airline Operating Permit 53
required by law.

Public Address System
Airline agrees that the use of City’s public address, voice and data communication system will be in accordance with the Airport Rules and Regulations. Airline shall not install, cause to be installed or use any other such system at the Terminal Building without the prior written approval of Director.

Employees of Airline
Airline shall require all of its employees, agents, officers, representatives, suppliers, contractors, subcontractors, licensees, subtenants, invitees, and suppliers hired by Airline and working about the Terminal Building to wear clean and neat attire and to display appropriate identification.

Removal of Disabled Aircraft
Airline shall promptly remove any of its disabled aircraft from any part of the Airport (including, without limitation, runways, taxiways, aprons and Bono Concourse and RJ Concourse Aircraft Gates) and place any such disabled aircraft in such storage areas as may be designated by City (or at Airline’s discretion, in an off-Airport location). Airline may store such disabled aircraft only for such length of time and on such terms and conditions as may be established by City. If Airline fails to remove any of its disabled aircraft promptly, City may, but shall not be obligated to, cause the removal of such disabled aircraft, provided, however, the obligation to remove or store such disabled aircraft shall not be inconsistent with federal and State laws and regulations and Airline agrees to reimburse City for all costs of such removal, and Airline further hereby releases City from any and all claims for damage to the disabled aircraft or otherwise arising from or in any way connected with such removal by City, except to the extent such damage arises from the negligence or willful misconduct of City, its employees, agents or contractors.

Item 1N - Page 178
Non-Signatory Airline Operating Permit 54
Licenses, Fees and Permits
Airline shall obtain and pay for all licenses, fees, permits, or other authorization or charges as required under federal, State or local laws and regulations insofar as they are necessary to comply with the requirements of this Permit and the privileges extended hereunder.

Reservations - Airspace and Noise
There is hereby reserved to City, its successors and assigns, for the use and benefit of the public, a right of flight for the passage of aircraft in the airspace above the surface of the Airline Premises. This public right of flight shall include the right to cause in such airspace any noise inherent in the operation of any aircraft used for navigation or flight through such airspace or landing at, taking off from, or other operations on the Airport.

National Emergency
This Permit and all the provisions hereof shall be subject to whatever right the U.S. Government now has, or in the future may have or acquire, affecting the control, operation, regulation and taking over of said Airport or the exclusive or nonexclusive use of the Airport by the United States during time of war or national emergency.

Noise Abatement and Mitigation
Airline acknowledges that the City of Palm Springs and its neighboring cities are noise sensitive communities; therefore, Airline shall comply with any formal noise abatement program or policy established by the City in conformance with federal statutes, laws, rules, and regulations and use reasonable efforts to comply with informal noise abatement programs established by the City.

Authority for Permit
Airline warrants and represents that it has the right, power, and legal Item 1N - Page 179
Non-Signatory Airline Operating Permit 55
capacity to enter into, and perform its obligations under this Permit, and no approvals or consents of any persons are necessary in connection with it. The execution, delivery, and performance of this Permit by the undersigned Airline representatives have been duly authorized by all necessary corporate action of Airline, and this Permit will constitute a legal, valid, and binding obligation of Airline, enforceable in accordance with its terms.

Entire Permit
This Permit, together with all exhibits attached hereto, constitutes the entire agreement between the parties hereto, and all other representations or statements heretofore made, verbal or written, are merged herein, and this Permit may be amended only in writing, and executed by duly authorized representatives of the parties hereto.

Item 1N - Page 180
Non-Signatory Airline Operating Permit 56

SIGNATURE PAGE TO AIRPORT PERMIT
BY AND BETWEEN THE CITY OF PALM SPRINGS AND __________
IN WITNESS WHEREOF, the parties have executed and entered into this Permit as of the date first written above.

AIRLINE:

By: ___________________________________
Signature
Date:

CITY OF PALM SPRINGS:

APPROVED BY CITY COUNCIL:

Date: ________ Item No. ________
APPROVED AS TO FORM: ATTEST:

By:

City Attorney
By:

City Clerk
APPROVED:

By:

City Manager
Date: :

Item 1N - Page 181

EXHIBIT A

AIRPORT BOUNDARY
Item 1N - Page 182
Palm Springs International Airport
Airport Boundary
Exhibit A
Item 1N - Page 183

EXHIBIT B

TERMINAL BUILDING SPACE MAPS
Item 1N - Page 184
Exclusive Use Space
Preferential Use Space
Palm Springs International Airport
Terminal Building Space Map
Exclusive and Preferential Space - Ticket Wing
Exhibit B-1

NORTH TICKET WING

SOUTH TICKET WING
Item 1N - Page 185
Palm Springs International Airport
Terminal Building Space Map
Joint Use Space
Exhibit B-2
Item 1N - Page 186
Palm Springs International Airport
Terminal Building Space Map
Exclusive Space – Bono Offices
Exhibit B-1
Item 1N - Page 187
Palm Springs International Airport
Terminal Building Space Map
Exclusive – Mezzanine Level – Main Terminal
Exhibit B-1
Item 1N - Page 188

EXHIBIT C

SUMMARY OF TERMINAL BUILDING AREAS
Item 1N - Page 189
(Fiscal Year Ending June 30)

FISCAL YEAR
2023

LEASED SPACE
EXCLUSIVE USE SPACE 1/
Alaska 2,670
American 2,037
Delta 1,392
Southwest 1,851
Skywest 450
United 2,011
Westjet 714
Air Canada 385
Boutique -
Allegiant -
Frontier -
JetBlue 355
Sun Country 69
Flair 120
EXCLUSIVE USE SPACE 12,054

PREFERENTIAL USE SPACE
Alaska 1,297
American 1,337
Delta 919
Southwest 637
Skywest -
United 1,337
Westjet 1,011
Air Canada 1,001
Allegiant 517
Frontier -
JetBlue 319
Sun Country 410
Flair 319
Avelo 319
PREFERENTIAL USE SPACE 9,423

HOLDROOM SPACE
Bono Terminal Holdroom 15,584
RJ Terminal Holdroom 14,644
TOTAL HOLDROOM SPACE 30,228
EXHIBIT C: SUMMARY OF TERMINAL AREAS
Item 1N - Page 190
(Fiscal Year Ending June 30)

FISCAL YEAR
2023

JOINT USE SPACE
Baggage Claim 19,112
Checkpoint 5,858
Checkpoint Queueing 12,246
Bono Holdroom Common Area 8,000
TOTAL JOINT USE SPACE 45,216

TOTAL LEASED AIRLINE SPACE
Exclusive 12,054
Preferential 9,423
Joint Use 45,216
TOTAL LEASED AIRLINE SPACE 66,693

UNLEASED AIRLINE SPACE
Exclusive Use 638
Preferential Use 867
Check-In Kiosks and Curbside Space -
Baggage Services Space -
Other Unleased Space -
TOTAL UNLEASED AIRLINE SPACE 1,505

NON-AIRLINE LEASABLE SPACE
Concessions/Other 17,845
TSA -
Admin -
TOTAL NON-AIRLINE RENTABLE SPACE 17,845
TOTAL LEASABLE SPACE 116,271
Non-Leasable Space:

Mechanical -
Circulation -
Public Circulation Enclosed 23,700
Public Circulation Unenclosed 56,200
Total Non-Leasable Space 79,900
TOTAL TERMINAL SPACE 196,171
NOTES:
1/ Bono hallway space of 840 sq ft. is included as exclusive use space for airlines that lease a Bono office SOURCE: City of Palm Springs; Ricondo & Associates, Inc., September 2022.

PREPARED BY: Ricondo & Associates, Inc., October 2022.

EXHIBIT C: SUMMARY OF TERMINAL AREAS
Item 1N - Page 191

EXHIBIT D

RATES FOR RENTALS, FEES, AND CHARGES
Item 1N - Page 192

EXHIBIT D

RATES FOR RENTALS, FEES, AND CHARGES
FISCAL YEAR 2024

1. Terminal Rental Rate.
a. Signatory Airline: $ per square foot.
b. Non-signatory Airline: $ per square foot.1

2. Landing Fee Rate.
a. Signatory Airline: $ per 1,000 pounds of Landed Weight. b. Non-Signatory Airline: $ per 1,000 pounds of Landed Weight.

3. Loading Bridge Fee:
a. Signatory Airline: $ per loading bridge attached to preferentially leased holdroom at the Bono Concourse.
b. Non-Signatory Airline: $ per loading bridge attached to preferentially leased holdroom at the Bono Concourse.

4. Per Use Fee – Aircraft Gate (Bono Concourse):
a. Signatory Airline: $ per one hour thirty minute period (1.5 hours) use, or any portion thereof.
b. Non-Signatory Airline: $ per one hour thirty minute period (1.5 hours) use, or any portion thereof.

5. Per Use Fee – Aircraft Gate (RJ Concourse):
a. Signatory Airline: $ per one hour thirty minute period (1.5 hours)use, or any portion thereof.
b. Non-Signatory Airline: $ per one hour thirty minute period (1.5 hours) use, or any portion thereof.

6. Per Use – Fee Ticket Counter:
a. Signatory Airline: $ per four (4) hour use, or portion thereof, of ticket counter area.
b. Non-Signatory Airline: $ per four (4) hour use, or portion thereof, of ticket counter area.

7. Non-Terminal RON Parking Fee: $0.00 for each Overnight use of Remote aircraft parking area.
1 Non-Signatory Airline rates shall apply to Non-Signatory Airlines if terminal rental rates and landing fees apply to such tenants/licensees. Non-Signatory Joint Use charges will include a twenty-five percent surcharge in addition to the rate charged to Signatory Airlines.

Item 1N - Page 193

EXHIBIT E

RESPONSIBILITIES OF CITY AND AIRLINE
FOR

OPERATION AND MAINTENANCE OF TERMINAL BUILDING
Item 1N - Page 194
Area/Item
City Airline
Aircraft Apron
Pavement Maintenance X
Pavement Markings X
Pavement Sweeping X
Airline Signage X
Fuel Spill Cleanup X
Exclusive and Preferential Use Space
Exterior Shell/Structure X
Access Control X
Airline Security Control X
Janitorial X
General Electrical/Mechanical/Plumbing X
Light Fixtures X
Interior Painting X
Carpeting/floor finishes X
Ticket Counter Shells X
Ticket Counter Inserts X
Baggage Handling System (BHS) X
Airline Improvements X
Airline Signage X
Holdrooms/Aircraft Gates
Counter Shells X
Counter/Inserts X
Signage (Directional) X
Arrival and Departure Boards X
Public Address System X
Loading Bridges X
Custodial X
Furniture X
Carpeting/floor finishes X
A&D TV Screens X
Carpet X
Access Control X
Airline Security Control X
Airline Signage X
Terminal Building - Public Use & General
Structural Maintenance, including roof X
City installed equipment and systems X
Electrical service - Terminal, Aircraft
Apron, BHS, and Loading Bridges
X
EXHIBIT E: MAINTENANCE AND OPERATIONS RESPONSIBILITIES
Responsibility
Item 1N - Page 195
Area/Item
City Airline
Terminal Building - Public Use & General
HVAC service - Terminal, Aircraft
Apron, BHS, and Loading Bridges
X
Light fixtures X
Plumbing - excluding fixtures in Leased Space X
Domestic Water X
Carpeting/floor finishes X
SOURCE: City of Palm Springs; Ricondo & Associates, Inc., September 2022.

PREPARED BY: Ricondo & Associates, Inc., October 2022.

Responsibility
Item 1N - Page 196

EXHIBIT F

AFFILIATE IDENTIFICATION AND REQUIREMENTS
Item 1N - Page 197

EXHIBIT F

AFFILIATE IDENTIFICATION AND REQUIREMENTS
“Airline”:
“Affiliate”: d/b/a
Affiliate Address:

Affiliate Point of Contact:

Telephone:

Fax:

Email:

Date Start of Service:

Date of Termination:

Airline and Affiliate acknowledge and agree that Affiliate shall comply with all terms, conditions, covenants, and obligations as set forth in the Palm Springs International Airport Airline-Airport Use and Lease Agreement, dated July 1, 2023.

AIRLINE
By:

AFFILIATE
By:

Item 1N - Page 198

EXHIBIT G

MONTHLY ACTIVITY REPORT
Item 1N - Page 199

PSP MONTHLY AIRLINE ACTIVITY REPORT
AIRLINE: MONTH: YEAR: 2023 STATUS: SIGNATORY
SUBMITTED BY: PHONE: EMAIL:

TTL WAIVED
ENPLANED DEPLANED TOTAL SIGNATORY Sig Cost # Flts # Flts TTL USE WAIVED USE 0 BONO USE $0.00 $0.00
RJ USE $0.00 $0.00
DESTINATION # OF FLIGHTS TOTAL TOTAL $0.00 $0.00
0 ENPLANED DEPLANED TOTAL
0 *AIRLINE

INCENTIVE -
WAIVER

DESTINATIONS
AIRCRAFT TYPE (EX: 737 MAX) SEAT CAPACITY MGLW
(1,000 LB.)
TOTAL

LANDINGS

QUALIFIED

LANDINGS

TOTAL MGLW LANDING FEE

CALCULATION

TOTAL SEAT

CAPACITY

TOTAL MGLW
WAIVED

TOTAL WAIVED

LANDING FEE

CALCULATION

LANDING FEE

CALCULATION
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
0 $ - 0 0 $ - $ -
TOTALS 0 0 0 $ - 0 0 $ - $ -
NOTES:
*ONLY Airlines who have approved application and approved routes may qualify for the airline incentive waivers Send report to [email protected] by the 10th of the month

REVENUE PASSENGERS ONLY TOTAL HOLD ROOM USE CITY USE ONLY

CANCELED FLIGHTS

AIR CARGO (POUNDS)

MONTHLY LANDINGS BY AIRCRAFT TYPE CITY USE ONLY
Reports are due before the 10th of each month for the prior month.

Please e-mail to [email protected]
Item 1N - Page 200 Rev.9 -VC-3-2022

EXHIBIT H

FEDERAL NONDISCRIMINATION REQUIREMENTS
Item 1N - Page 201
Title VI Clauses for Compliance with Nondiscrimination Requirements.

During the performance of this Agreement, Airline, for itself, its assignees, and successors in interest, agrees as follows:

1. Compliance with Regulations: Airline will comply with the Title VI List of Pertinent Nondiscrimination Acts and Authorities (“Nondiscrimination Acts and Authorities” as set forth in paragraph B below), as they may be amended from time to time, which are herein incorporated by reference and made a part of this Agreement.

2. Nondiscrimination: Airline, with regard to the work performed by it during this Agreement, will not discriminate on the grounds of race, color, or national origin in the selection and retention of subcontractors, including procurements of materials and leases of equipment. Airline will not participate directly or indirectly in the discrimination prohibited by the Nondiscrimination Acts and Authorities, including employment practices when this Agreement covers any activity, project, or program set forth in Appendix B of 49 CFR part 21.

3. Solicitations for Subcontracts, including Procurements of Materials and Equipment: In all solicitations, either by competitive bidding or negotiation made by Airline for work to be performed under a subcontract, including procurements of materials, or leases of equipment, each potential subcontractor or supplier will be notified by Airline of Airline’s obligations under this Agreement and the Nondiscrimination Acts and Authorities on the grounds of race, color, or national origin.

4. Information and Reports: Airline will provide all information and reports required by the Acts, the Regulations, and directives issued pursuant thereto and will permit access to its books, records, accounts, other sources of information, and its facilities as may be determined by the sponsor or the Federal Aviation Administration to be pertinent to ascertain compliance with such Nondiscrimination Acts and Authorities and instructions. Where any information required of Airline is in the exclusive possession of another who fails or refuses to furnish the information, Airline will so certify to the sponsor or the Federal Aviation Administration, as appropriate, and will set forth what efforts it has made to obtain the information.

5. Sanctions for Noncompliance: In the event of Airline’s noncompliance with the non-discrimination provisions of this Agreement, City will impose such contract sanctions as it or the Federal Aviation Administration may determine to be appropriate, including, but not limited to:
a. Withholding payments to Airline under this Agreement until Airline complies; and/or
b. Cancelling, terminating, or suspending a contract, in whole or in part.

Incorporation of Provisions: Airline will include the provisions of paragraphs one through six in every subcontract, including procurements of materials and leases of equipment, unless exempt by the Acts, the Regulations, and directives issued pursuant thereto. Airline will take action with respect to any subcontract or procurement as the sponsor or the Federal Aviation Administration may direct as a means of enforcing such Item 1N - Page 202
provisions including sanctions for noncompliance. Provided, that if Airline becomes involved in, or is threatened with litigation by a subcontractor, or supplier because of such direction, Airline may request the sponsor to enter into any litigation to protect the interests of the sponsor. In addition, Airline may request the United States to enter into the litigation to protect the interests of the United States.

Item 1N - Page 203

CITY COUNCIL STAFF REPORT
04/27/2023
SUBJECT:

APPROVE SERVICE AGREEMENT NO. 23S080 WITH THE AMERICAN

ASSOCIATION OF AIRPORT EXECUTIVES TO PROVIDE MANDATED VETTING

AND COMPUTER-BASED TRAINING FOR THE PALM SPRINGS INTERNATIONAL

AIRPORT
RECOMMENDATION:

1. Approve a three-year agreement with American Association of Airport Executives to provide mandated background vetting services and computer-based training in the amount of $126,675 commencing on July 1, 2023, and ending on June 30, 2026, included as Attachment A.

2. Authorize the City Manager or designee to execute all necessary documents.

Attachments
Item 1O

CITY COUNCIL STAFF REPORT
DATE: APRIL 27, 2023 CONSENT CALENDAR
SUBJECT: APPROVE SERVICE AGREEMENT NO. 23S080 WITH THE AMERICAN

ASSOCIATION OF AIRPORT EXECUTIVES TO PROVIDE MANDATED

VETTING AND COMPUTER-BASED TRAINING FOR THE PALM

SPRINGS INTERNATIONAL AIRPORT
FROM: Scott C. Stiles, City Manager
BY: Department of Aviation
SUMMARY:

This action will approve a three-year service agreement with the American Association of Airport Executives (AAAE) to provide mandated background vetting services and computer-based training for the Palm Springs International Airport.

RECOMMENDATION:

1. Approve a three-year agreement with American Association of Airport Executives to provide mandated background vetting services and computer-based training in the amount of $126,675 commencing on July 1, 2023 and ending on June 30, 2026, included as Attachment A.

2. Authorize the City Manager or designee to execute all necessary documents.

BUSINESS PRINCIPAL DISCLOSURE:

According to the Public Integrity Disclosure Form (Attachment B) submitted on March 14, 2023, AAAE is an Illinois corporation registered to do business in California. The persons serving presently are Officer Todd Hauptli, President & CEO and Director Mark Gale, Chair.

BACKGROUND:

Individuals seeking employment with airlines, concessionaires, service providers and contractors working at the Palm Springs International Airport (Airport) must undergo a multiple-step background check in order to obtain badges that will give them access to secured areas of the Airport campus. The Airport screens an average of 1,100 applicants Item 1O - Page 1
City Council Staff Report
April 27, 2023 – Page 2
AAAE Contract Services Agreement No. 23S080
each year. Once the background check has been successfully completed, applicants are required to take a computer-based interactive training course on safety and security procedures at the Airport. Recurrent training is also offered to badge holders. In addition, direct employees of the Department of Aviation can access online computer-based training courses as needed to comply with new requirements as well as elective courses to further their knowledge on relevant Airport topics.

STAFF ANALYSIS:

The Airport has been using the services of AAAE for over two decades to provide computer-based training to Airport employees. Training videos include new employee hire materials as well as required and elective training videos on safety, security, Federal Aviation Administration (FAA) requirements, Transportation Security Administration (TSA) requirements, Aircraft Rescue and Firefighting, and Airport management topics.

While AAAE has provided training, the background checks were performed by a separate company, Telos Identification Management Solutions, LLC (Telos), and Airport staff had been renewing both of the agreements each year.

Airport staff wishes to partner with AAAE to continue offering training courses and to provide background vetting services. These vetting services are referred to as Designated Aviation Channeling (DAC), and AAAE is a TSA approved Designated Aviation Channeler. DAC services include fingerprint-based Criminal History Records Checks (CHRC) and biographical Security Threat Assessment (STA) checks.

Under this agreement, AAAE will:
• Collect fingerprints and biographical data and forward them to the appropriate Federal agency for processing. Submission status can be tracked at any point of the process.
• Facilitate the Airport’s participation in the federally mandated Record of Arrest and Prosecution (RAP) Back Program, which provides automatically updated information about current employees.
• Ensures that the City data transmitted to TSA is secured in accordance with the Federal Information Security Management Act, and appropriate Department of Homeland Security (DHS) and TSA security policies.
• Ensures that processes are in strict accordance with TSA and Federal Bureau of Investigation (FBI) regulations while maintaining the highest standards for privacy of the employee’s information.
• Makes AAAE’s platform available for integration with the Airport’s chosen thirdparty identity management provider.

Fees for Designated Aviation Channeling vetting services are outlined in Table 1 below based on an average of 1,100 employees processed each year.

Item 1O - Page 2
City Council Staff Report
April 27, 2023 – Page 3
AAAE Contract Services Agreement No. 23S080
DAC Vetting Services Number of
Employees
Fee per
Employee
Annual Cost
Criminal History Record Check 1100 $14.00 $15,400
Security Threat Assessment 1100 $2.00 $2,200
RAP Back Subscription 1100 $1.75 $1,925
Annual Cost $19,525
x3 years
Three-Year Total Not To Exceed $58,575
Table 1 – DAC Vetting Services
Under this agreement, AAAE will continue to provide Computer-Based Training (CBT), and AAAE will also:
• Provide an initial upgrade of CBT courses and software. This new Interactive Employee Training - Learning Suite (IET-LS) which offers initial employee hire and recurrent training will be configured online to the Airport’s specific credential requirements to host the Airport course at a one-time cost of $15,000. • Provide a selection of courses and content to the Airport for review and testing. • Provide a maintenance support and service plan including telephone support and helpdesk, maintenance of the database, video-quality system updates and patches, interactive course changes and updates, one train-the-trainer yearly visit, regulatory requirement updates, video edits, software enhancements and updates to increase efficiency of the training operation and hosting of the Airport’s training course curriculum.

The annual cost for IET-LS support amounts to $13,200; Digicast support, which covers all elective videos, amounts to $4,500.

Training services costs are detailed in Table 2 below:

Software and Support Services Year
One
Year
Two
Year
Three
Three-year
Agreement
Learning Suite Upgrade – One-time
fee
$15,000 - - $15,000
Annual IET Support $13,200 $13,200 $13,200 $39,600
Annual Digicast Support $4,500 $4,500 $4,500 $13,500
Total Not To Exceed $32,700 $17,700 $17,700 $68,100
Table 2 – Training Services Costs
The three-year cost for all services amounts to $126,675.

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City Council Staff Report
April 27, 2023 – Page 4
AAAE Contract Services Agreement No. 23S080
The Airport wishes to add another software component, AirBadge, to the AAAE platform.

This item will be presented under a separate agreement and staff report, but its introduction in this context is relevant to the selection of AAAE to provide Federal Mandated Security Background Clearances and Training. AirBadge is a unique product which allows Airport applicants to complete badge applications remotely and electronically, employers to track and update badge status in real time, and the Airport Security Manager (ASM) to produce TSA-ordered badge audits promptly and accurately.

This software will save countless hours of labor for the Airport badging office and for the ASM. This feature can only be integrated into the AAAE platform.

Because of AAAE’s expertise, credentials with the TSA as an approved DAC and the possibility of integrating AirBadge, Airport staff considers AAAE a preferred vendor. By selecting this company, staff is abiding by Section 7.05.030 of the City of Palm Springs Municipal Code as it pertains to special expertise procurement.

This Agreement requires City Council approval in accordance with Municipal Code Title 7 adopted by Ordinance in July of 2021, which establishes approval levels based upon the cumulative value of contracts and continuous purchases of the same goods or services. Since 2011, the City has spent approximately $286,867 maintaining interactive employee training services and subscriptions with AAAE.

ALIGNMENT WITH STRATEGIC PLANNING:

The requested action aligns with the City Council Priority 3A, Community Infrastructure.

FISCAL IMPACT:
$52,225 is budgeted in Account 4157055.40105 in Fiscal Year 2024. The remaining annual amounts will be budgeted in future fiscal years.

REVIEWED BY:

Department Director: Harry Barrett, Jr.

Acting Finance Director: Kristopher Mooney
Procurement and Contracting Manager: Kim Baker
City Attorney: Geremy Holm
City Manager: Scott Stiles
ATTACHMENTS:

A. Contract Service Agreement No. 23S080
B. Public Integrity Business Disclosure
Item 1O - Page 4

ATTACHMENT A
AGREEMENT NO. 23S080

WITH AMERICAN ASSOCIATION

OF AIRPORT EXECUTIVES (AAAE)
Item 1O - Page 5
SERVICES AGREEMENT NO. 23S080 BY AND BETWEEN THE CITY OF PALM

SPRINGS AND THE AMERICAN ASSOCIATION OF AIRPORT EXECUTIVES (AAAE)
THIS SERVICES AGREEMENT NO. 23S080 (“Agreement”) is made and entered into as of May 4, 2023 (the “Effective Date”) by and between (i) the American Association of Airport Executives (“AAAE”), and (ii) the City of Palm Springs, a charter city and municipal corporation organized under the laws of the State of California (“City”), who, intending to be legally bound, hereby agree as follows:

1. Purpose of Agreement; Scope of Services.

The purpose of this Agreement is to provide Designated Aviation Channeling (DAC) services via AAAE’s Transportation Security Clearinghouse and support of Computer Based Training (CBT) solutions to operate effectively and efficiently, in accordance with federal regulations (“Services”). The scope of services and the parties’ responsibilities are as defined in Exhibit “A” (DAC services) and Exhibit “B” (CBT solutions) attached hereto and by this reference made a part hereof.

2. Fees and Payment

2.1 Fee Payment. In full payment for the Services to be provided, City shall pay the fees set forth in Exhibit “C” at the times and in the manner set forth herein. The total amount of Compensation shall not exceed $126,675.00

2.2 Payment Procedures. For DAC services, the City shall establish and maintain a deposit account on which AAAE shall have the limited authority to debit the fees set forth in Sections 2.2 and 2.3 for each of City’s enrollments. City shall retain full ownership of the deposit account and shall replenish such account balance periodically as needed. The AAAE shall notify City immediately at any time that there is an unavailability of funds in City’s deposit account. City’s deposit account can be replenished by ACH, wire transfer, check or credit card. AAAE will debit the City’s deposit account for any ACH or electronic transfer fees incurred prior to releasing the funds for processing records. For development of CBT programs, AAAE shall submit an invoice to the City for the total project cost noted in Exhibit “C” after delivery of the training courses for User Acceptance Testing. For support of CBT solutions, AAAE shall submit an invoice to the City on an annual basis, starting with the first of the month following the execution of this Agreement.

The City shall pay such invoice within thirty (30) calendar days of receipt.

2.3 Invoicing. For DAC services, the City’s account will be debited through an automated system. However, for the purposes of corrections or other administrative purposes where an individual will be required to have access to the account, AAAE shall designate a qualified AAAE official, and alternate, with accounting responsibilities to have access to the deposit account.

The AAAE shall provide to the City the ability to view basic financial information on AAAE website through the Financial Information link. This information can be sorted and Item 1O - Page 6
searched by the City to provide an invoice itemizing with reasonable specificity the debits made by AAAE during the prior month. In the event City disputes any items, the parties shall work in good faith to resolve such disputes and make any necessary refunds and credits.

3. Term and Termination

3.1 Term. Unless earlier terminated in accordance with Section 3.2 or 3.3 of this Agreement, this Agreement shall continue in full force and effect for a period of 3 years commencing on July 1, 2023, and ending on June 30, 2026, unless extended by mutual written agreement of the Parties.

3.2 Termination for Default. This Agreement may be terminated by either party in the event that the other party has not performed any material obligation or has otherwise breached any material term of this Agreement upon the expiration of thirty (30) days (or any longer cure period authorized by the non-breaching party with respect to any individual breach) after receipt of written notice thereof if the breach or nonperformance has not then been cured.

3.3 Action upon Termination. Upon expiration or earlier termination of the Agreement, in regard to the DAC services, AAAE shall provide to City a final accounting, including but not limited to, all uninvoiced amounts.

4. Representations and General Warranties

4.1 By AAAE. The AAAE hereby represents and warrants to City as follows:
a. Authorization and Binding Obligation. The AAAE has full corporate power and authority to enter into, deliver and perform fully its obligations under this Agreement. This Agreement has been fully executed and delivered by AAAE, and constitutes the legal, valid, and binding obligation of AAAE, enforceable against it in accordance with its terms.
b. No Conflict. The execution, delivery and performance by AAAE of its obligations under this Agreement do not knowingly conflict with, result in a breach of or require any consent under the charter or bylaws of AAAE or any applicable law or regulation, any order, writ, injunction or decree of any court or governmental authority or agency, or any agreement or instrument to which AAAE is a party or by which it is bound or to which it subject, or constitute a default under such agreement or instrument.

4.2 By City. City hereby represents and warrants to AAAE as follows:
a. Authorization and Binding Obligation. City has full corporate power and authority to enter into, deliver and perform fully its obligations under this Agreement.

This Agreement has been duly executed and delivered by City and constitutes the legal, valid, and binding obligation thereof, enforceable against City in accordance with its terms.

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b. No Conflict. The execution, delivery and performance by City of its obligations under this Agreement do not conflict with, result in a breach of or require any consent under, the charter or bylaws of City or any applicable law or regulation, or any order, writ, injunction or decree of any court or governmental authority or agency, or any agreement or instrument to which City is a party, or by which it is bound or to which it is subject, or constitute a default under any such agreement or instrument.

5. Warranty and Use of Software for CBT Solutions
a. Use of Software. The parties agree that the Software is proprietary to AAAE.

AAAE retains all intellectual property rights, including copyright, patent and trade secret rights and the City agrees that the Software and all related data whether oral or written, and furnished under this Agreement are provided for the City’s (and its consultants and contractors) exclusive use for the purposes of this Agreement and will be held in confidence. The City agrees not to duplicate or disclose any information provided relative to the Software in whole or in part, for the use of others.

The City will use the Software only for its own internal training purposes. b. Warranty. AAAE warrants that the software and training courses at the time of installation of CBT shall materially conform to the specifications agreed-upon in Exhibits A and B of this Agreement. In case of a nonconformance, the City shall promptly notify AAAE. AAAE shall correct any nonconformance after notification within a reasonable time by the means it determines to be the most appropriate, whether by telephone instructions, the issuance of updating documentation, corrective code, hardware replacement or modification, or other methods.

Notwithstanding the warranties outlined above, AAAE makes no other warranties, express or implied, oral, or written, and makes no representation or guarantees to City whatsoever and specifically disclaims all other warranties.

6. Confidentiality

6.1 Confidentiality. Each party shall maintain in strict confidence, and agrees not to disclose to any third party, except as necessary for the performance of this Agreement when authorized by the other party in writing, Confidential Information that one party receives (“Recipient”) from disclosing party (“Discloser”). “Confidential Information” means all non-public information of a competitively sensitive nature concerning the disclosing party, including, but not limited to: (a) software, data, and information regarding services, systems or products; (b) processes, procedures, operations, engineering or technology; (c) present product lines, including without limitation, their design, manufacture, marketing, quality control, costs, configurations and uses for such products, as well as the aforementioned information related to products which are the subject of either party’s research and development; (d) customer lists, customer information, business plans or data, sales volumes, profitability figures, financial information or other economic Item 1O - Page 8
or business information; or (e) any efforts undertaken by either party on behalf of their members or customers.

6.2 Exceptions. Confidential Information does not include: information that is required by law and/or order of competent legal authority to be disclosed; information that is or subsequently may come within the knowledge of the public generally through no fault of Recipient; information that Recipient can show was previously known to it as a matter of record at the time of receipt; information that Recipient may subsequently obtain lawfully from a third party who has lawfully obtained the information free of any confidentiality obligations; or information that Recipient may subsequently develop as a matter of record, independently of disclosure by Discloser.

6.3 Duration. With respect to Confidential Information not constituting a trade secret, this Agreement shall remain in full force and effect for a period of three (3) years; with respect to Confidential Information constituting a trade secret, this Agreement shall remain in full force and effect for so long as the Confidential Information constitutes a trade secret.

6.4 Injunctive Relief. Recipient acknowledges that disclosure of any Confidential Information by it or its employees will give rise to irreparable injury to Discloser or the owner of such information, not adequately compensated by damages.

Accordingly, Discloser or such other party may seek and obtain injunctive relief against the breach or threatened breach of this Section, in addition to any other legal remedies which may be available, without the requirement of posting bond.

7. Intellectual Property Rights

7.1 The AAAE and City acknowledge that both parties and/or third parties retain all right, title and interest under applicable contractual, copyright, intellectual property, and related laws to their previously owned, developed or obtained intellectual property and any enhancements and modifications to same and in the databases and information contained therein used to provide either party’s products or services hereunder, and the parties shall use such materials consistent with such right, title and interest and notify the applicable party of any threatened or actual infringement thereof.

7.2 The AAAE retains all its previously owned, developed or obtained intellectual property. The City shall use AAAE’s intellectual property with such rights as necessary to perform the functions of AAAE’s Background Check Web Services (BCWS), and notify AAAE of any threatened or actual infringement thereof.

7.3 In the event that development work is undertaken under this contract by AAAE, which specifically excludes all previously owned, developed or obtained intellectual property, then any such developed items shall be owned by AAAE except in instances related to CBT solutions where AAAE develops City specific data or video, which are explicitly for the City and using the City’s information, then such developed data and video shall be owned by the City.

Item 1O - Page 9

7.4 City shall not, except as required by applicable law (and then only to that extent):
• Reverse engineer, translate, disassemble, decompile the whole or any part of AAAE’s service offering, solution or proprietary assets or otherwise attempt to access same;
• Assign, transfer, sell, license, sub-license, lease, rent, charge or otherwise deal in or encumber the proprietary material of AAAE or use the proprietary material of AAAE on behalf of or for the benefit of any third party, or make available the same in any way whatsoever to any third party without AAAE’s prior written consent in a fashion contrary to the terms of this Agreement; • Distribute, create derivative works of or modify proprietary material of AAAE in anyway, nor create or develop a competitive or similar offering to that of AAAE, nor use, copy, duplicate or display the proprietary material of AAAE on a commercial or development basis except as expressly provided under an agreement.

8. Data Protection
The AAAE is dedicated to protecting the City provided data, including biometric and biographic information, and providing the City with the highest level of service.

City provided data, which includes personal information sent to AAAE, is not disclosed, made available or otherwise used for any purposes other than for those purposes of completing fingerprint-based criminal history records checks and security threat assessments as prescribed by federal regulation or other forms of government mandate or requests or as mutually agreed upon by City and AAAE. Fingerprint and biographical information can be used for other purposes only with the data provider’s express permission or as required to comply with applicable laws.

The AAAE does not disclose the City provided information to companies outside AAAE and AAAE agents and subcontractors, except as required by law. The confidentiality of City information is an important part of our operations and a standard business practice.

9. Limitation of Liability
Notwithstanding the aforementioned, in no event shall any party be liable for any special, indirect, exemplary, incidental, punitive, or consequential damages arising out of or otherwise relating to the use or performance of the Services.

10. Indemnification

10.1 Indemnification. Each party (the “Indemnifying Party”) will defend the other party and its officers, directors, employees, and agents (its “Related Parties”) from Item 1O - Page 10
and against any claim, allegation or action (any “Action”) brought against the other party or one of its Related Parties by a third party (other than by the other party itself or another of its Related Parties) to the extent relating to, resulting from, or arising out of the gross negligence or willful misconduct of the Indemnifying Party in the performance (or failure to perform) any of its obligations under this Agreement. The Indemnifying Party will further pay those liabilities, direct damages, fees, expenses, and costs (including reasonable attorneys' fees and court costs) (“Losses”) finally awarded against the other party or one of its Related Parties in any such Action or those Losses agreed to in a monetary settlement of such Action, as applicable.

10.2 Non-Infringement Indemnification. AAAE will defend City from and against any action brought against City by a third party that the use by City of the Software infringes any U.S. patent, or copyright or misappropriates any trade secret in existence under any laws of any state within the U.S. AAAE will pay those Losses finally awarded against City in any such Action or those Losses agreed to in a monetary settlement of such action, as applicable. If City is, or AAAE reasonably believes City may be, enjoined from using any Software due to an action covered by this Section, AAAE may procure the right for City to continue using the Software, replace or modify the Software so that it becomes non-infringing, or terminate this Agreement and provide City a refund of any pre-paid amounts applicable to the Software (if any). AAAE will have no obligation under this Section or otherwise with respect to any action or Losses in the case of: (a) any use of any Software other than by City; (b) any use of any software not under and in accordance with this Agreement; (c) any use of any Software in combination with products, equipment, services, processes, software, data or information not supplied by AAAE; or (d) any modification of or enhancement to any Software other than by AAAE.

11. Miscellaneous

11.1 Relationship. This Agreement does not create any partnership, joint venture, franchisor-franchisee, or employer-employee relationship between the parties hereto.

Neither party hereto is granted any express or implied right or authority to bind the other party hereto in any manner whatsoever.

11.2 No Third-Party Beneficiaries. There are no third-party beneficiaries entitled to enforce any provisions of this Agreement.

11.3 Entire Agreement. This Agreement, together with the Exhibits attached hereto, contains the entire agreement and understanding of the parties hereto with respect to the matters herein set forth, and all prior agreements, negotiations and understandings relating to the subject matter of this Agreement are merged herein and are superseded and canceled by this Agreement.

11.4 Amendment. This Agreement may not be modified except in writing, signed by both of the parties hereto.

Item 1O - Page 11

11.5 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California without giving effect to conflicts of law principles thereof.

11.6 Notices. All communications between the parties with respect to any of the provisions of this Agreement shall be in writing, and shall be sent by personal delivery or airmail, facsimile transmission, or other commercial means of rapid delivery, postage or costs of transmission and delivery prepaid, to:

If to AAAE, to:

American Association of Airport Executives
601 Madison Street
Alexandria, VA 22314
Attn: Kyle Herbig, Vice President – Airport Solutions
If to City:

City of Palm Springs
ATTN: Scott Daugherty, Airport Security Coordinator
3400 East Tahquitz Canyon Way, Palm Springs, CA 92262
or at such other address, such other person’s attention, or such other facsimile number, as shall be specified by like notice.

11.7 Severability. In the event that any provision of this Agreement is declared by a court of competent jurisdiction or arbitration tribunal to be void or unenforceable, the parties hereto expressly agree that such void or unenforceable provision shall be deemed severed from this Agreement, and the remainder of this Agreement shall not be affected thereby and shall remain in full force and effect to the extent feasible in the absence of the void and unenforceable provision. The parties furthermore agree to execute and deliver such amendatory contractual provisions to accomplish lawfully as nearly possible the goals and purposes of the provision so held to be void or unenforceable.

11.8 Waiver. Any party may waive compliance by the other party with any of the provisions of this Agreement. No waiver of any provision shall be construed as a waiver of any other provision or the same provision in a subsequent instance. Any waiver must be in writing.

11.9 Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. No assignment of this Agreement or of any contractual rights or obligations hereunder may be made by either party (by operation of law or otherwise) without the prior written consent of the other party hereto, which shall not be unreasonably withheld, and any attempted assignment without the required consent shall be null and void.

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11.10 Cooperation. Each party hereto shall take all such steps and measures as may be requested by the other party hereto in order to effectuate the purposes of this Agreement.

11.11 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement.

11.12 Headings. The section headings and other descriptions contained in this Agreement are for reference purposes only and shall not affect any way the meaning or interpretation of this Agreement.

11.13 Further Assurances. Each party hereto shall do and perform or cause to be done and performed all further acts and things and shall execute and deliver all such other certificates, instruments and documents as any other party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

11.14 Dispute Resolution. The parties shall make good faith efforts to first resolve internally any dispute under this Agreement by escalating it to higher levels of management.

11.15 Insurance. AAAE shall procure and maintain, at its sole cost and expense, policies of insurance in the attached Exhibit “D”, incorporated herein by reference.

12. FEDERAL PROVISIONS
Since funding for the Services is provided, in whole or in part, by the Federal Aviation Administration, Supplier shall also fully and adequately comply with the provisions included in Exhibit “E” attached hereto and incorporated herein by reference (“Federal Provisions”). With respect to any conflict between such Federal Provisions and the terms of this Agreement and/or the provisions of state law, the more stringent requirement shall control.
[SIGNATURES ON NEXT PAGE]
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SIGNATURE PAGE TO SERVICES AGREEMENT NO. 23S080 BY AND BETWEEN

THE CITY OF PALM SPRINGS AND AMERICAN ASSOCIATION OF AIRPORT

EXECUTIVES
IN WITNESS WHEREOF, this Agreement has been duly executed by or on behalf of each of the parties hereto as of the date first above written.

AMERICAN ASSOCIATION OF AIRPORT EXECUTIVES:

By: _____________________________________ By: _________________________________________ Signature Signature
(2nd signature required for Corporations)
Date: Date:

CITY OF PALM SPRINGS:

APPROVED BY CITY COUNCIL:

Date: _______ Item No.

APPROVED AS TO FORM: ATTEST:

By: ___________________________ By:______________________________ City Attorney City Clerk
APPROVED:

By: _______________________________ Date:

City Manager – over $50,000
Deputy/Assistant City Manager – up to $50,000
Director – up to $25,000
Manager – up to $5,000
Item 1O - Page 14
Exhibit “A”
Designated Aviation Channeling Services
The AAAE is a Transportation Security Administration (TSA) approved Designated Aviation Channeler (DAC) for: (1) the statutorily required biometric checks; (2) the TSA mandated biographical data checks; and (3) individual subscription enrollment to the federally mandated Rap Back Program.

Specifically, AAAE’s channeling responsibilities include the receipt and processing of mandated background investigations, consisting of a (1) fingerprint-based criminal history records check and (2) biographical security threat assessment, of each individual employed in, or applying for, a position in which the individual: (3) has unescorted access, or may permit other individuals to have unescorted access, to aircraft of an air carrier or foreign air carrier or a secured or sterile area of an airport in the United States; (4) will be responsible for screening passengers or property to be carried aboard an aircraft; (5) is a supervisor of the individuals described in (4) above; (6) who exercises security-related functions associated with aircraft, or performs their duties in sensitive areas of the aviation system, as the TSA Administrator determines is necessary to ensure air transportation security; and (7) is an airport operator employee or agent known as a trusted agent who collects information from applicants and current airport identification media holders used for Criminal History Record Checks (CHRC) and Security Threat Assessments (STA) checks, transmits the information to AAAE, authorizes the issuance of identification media, or issues the identification media.

In consideration of the fees paid pursuant to the terms of the Agreement, AAAE will collect and process CHRC and STAs.

The AAAE service obligations are:
o Accepting the City’s aviation worker fingerprints, biographical data and required payments for processing the background investigations and immediately forwarding each background check to TSA or another appropriate Federal agency for processing, using electronic means to transmit electronic prints.
o Facilitating the airport’s participation in the federally mandated Rap Back program, maintaining the City’s subscriptions and providing support to the City for the program’s requirements.
o Utilizing AAAE’s fingerprint tracking process, which allows for accurate fingerprint submission status at any point in the background check process.
o Performing “real-time” processing to transmit fingerprints to the federal system.

Item 1O - Page 15
o Providing quality assurance and error corrections, when possible, allowing for the maintenance of one of the best error rates in the U.S. for submissions to the FBI.
o Providing superior customer support to City for questions regarding AAAE services and coordinating the resolution of City problems regarding TSA technical and procedural issues.
o Ensure that the City data transmitted to TSA is secured in accordance with the Federal Information Security Management Act (FISMA), DHS 4300a controls, and appropriate DHS and TSA security policies. o Ensure that processes are in strict accordance with TSA and FBI regulations and guidance and AAAE maintains the highest standards for privacy of the employee information.
o Make AAAE’s BCWS platform available for integration with airport’s chosen third-party identity management provider.

The City’s obligations are:

City agrees to use AAAE as a DAC for the aviation worker vetting programs outlined above for the term of the agreement and so long as AAAE is approved as a DAC by TSA.

City shall perform all obligations required to support AAAE in performing the services, including, but not limited to:
o Delivering to AAAE formatted data, associated supporting documentation, and certification, as required by TSA;
o Establishing and maintaining secure and reliable communication with AAAE and keep the communication methods in good working order; and o Providing AAAE with complete and accurate documents and biometric data for each aviation worker program applicant and in a form and format that is reasonably acceptable to AAAE.

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Exhibit “B”
Computer Based Training Solutions Statement of Work
The following is the maintenance support and service plan for the CBT solutions, also known as the Interactive Employee Training (IET).

AAAE will provide Computer Based Training to the City consisting of a customized, webbased training solution. AAAE’s web-based system, the Interactive Employee Training Learning Suite (IET), is airport-specific, scalable and has cloud-based capabilities.

AAAE’s obligations are as follows:

AAAE will be directly involved in all aspects of the project and is responsible for planning and execution. AAAE’s team consists of a Project Manager who will be the City’s primary point of contact, and several team members who are assigned to deliver their tasks according to the project schedule or timeline. On large projects, some team members may serve as Team Leads, providing task and technical leadership. The Project Manager will be responsible for overseeing the day-to-day activity and coordinate all functions and workflows.

At initiation of the project, the Project Manager will schedule a kickoff meeting to review development phases and approval cycles. The courses and their content will be provided to the City for review, and the City will have time to review course material. The Project Manager will provide the City with a project timeline and scope of work. If at any time, the City desires to make any changes or variations from the script(s) or storyboard(s) or from any material or work in progress, and such changes result in additional costs to AAAE, AAAE agrees to notify the City of the amount before any such additional costs are incurred and AAAE shall proceed only after receiving approval (written or oral) from Authorized Representative, approval by City shall be binding and incorporated into the terms of this Agreement. Reimbursement for such additional costs shall be payable in accordance with the terms of this Agreement for final payment.

The City’s obligations are as follows:

User Acceptance Testing. Those authorized to conduct user acceptance testing for the City will have seven (7) business days to make comments upon delivery from the AAAE. If no comments are received after seven (7) business days from delivery, AAAE will assume the City has accepted and approved the delivered courses and complete the project. If the City makes changes to the courses after the user acceptance period is complete, then a change order will be initiated at a rate of $150 per hour charged to the City.

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Maintenance Support / Service Plan
Service Description
8AM - 8PM EST
Monday-Friday Phone
Support
Includes technical telephone support between the hours of 8AM & 8PM EST Monday – Friday (except Federal holidays).

Database Support
Includes complete maintenance of the database and 24/7 availability of all user data. AAAE ensures data integrity by using overlapping Internet service providers (ISPs), firewall protection for the on-site and remote servers and the daily back up of all data.

Helpdesk Ticketing
System
AAAE implements a helpdesk ticketing system to improve the quality of service, accountability, and customer satisfaction.

System Updates and
Patches
Includes all operating and video-quality system updates and patches developed by AAAE with remote installation.

Interactive Course
Changes
Includes periodic editing of test questions and other interactive modifications that can be accomplished in the AAAE studio/edit facilities.

This package comes with a total allowance of 24 hours per year of labor.

These allowance hours may be used for interactive course changes. Each additional hour of labor over the maximum amount will be billed at a rate of $150/hour.

Train the Trainer
Includes an annual on-site visit for the purpose of introducing our IET training system to new staff or to hold a Q&A session for staff that are familiar with IET. Our hands-on approach will also be an opportunity for us to demonstrate any new tools or features of IET.

Regulatory
Requirements
Package includes updates to course material and videos to remain compliant with federal regulatory changes.

Custom
Content/Video
Changes
Allows for periodic changes/additions to a custom or Value-Added video course that can be accomplished in the AAAE studio/edit facilities. This package comes with a total allowance of 24 hours per year of labor.

These allowance hours may be used for custom content / video changes.

Each additional hour of labor over the maximum amount will be billed at a rate of $150/hour.

Software
Enhancements and
Updates
Includes periodic Learning Suite and Player enhancements AAAE will make to the IET platform to increase efficiency and automation of the software and training operation.

AAAE Hosting
AAAE will host the City’s training course curriculum. Required web browsers include Google Chrome, Microsoft Edge, Apple Safari, and Mozilla Firefox.

Item 1O - Page 18
Exhibit “C”
Fees and Payment
City shall pay the fees set forth in this Exhibit for the Services performed by AAAE as outlined in the Agreement.

Fees for DAC Services
City shall pay AAAE:
• Fourteen dollars ($14.00) per criminal history record check (CHRC) submission or resubmission. This fee is inclusive of the federal fee assessed by the Federal Bureau of Investigation (FBI).

PSP Annual Average - 1100 CHRCs x $14.00 = $15,400.00
__________________________________________________________________ • Two dollars ($2.00) per security threat assessment (STA).

PSP Annual Average - 1100 STAs x $2.00 = $2,200.00
__________________________________________________________________ • One Dollar and Seventy-Five Cents ($1.75) per RAP Back subscription.

PSP Annual Average – 1100 Rap Back Enrollments x $1.75 = $1,925.00 __________________________________________________________________ • Airport Employee Vetting Services Total Annual Cost Not To Exceed $19,525.00 • Airport Employee Vetting Services Three-year total not to exceed = $58,575.00 __________________________________________________________________ There shall be no annual, monthly or any other recurring fees associated with each of the aforementioned background check types. The AAAE reserves the right to adjust the above fees in case of a federal change in the price of a CHRC, provided that it provides fifteen (15) days’ notice to City prior to implementing such price adjustment.

Item 1O - Page 19
Fees for upgrade of CBT Courses and Software (One Time Fee - 1 st Year)

SOFTWARE DESCRIPTION PRICE
Enterprise License and IET-LS
Online Configuration
Learning Suite (database) license for training records and reporting via web-based application. Labor required to
configure IET-LS online site to the airport’s specific credential requirements to host the airport’s courses.
• New Database
• Current PSP SIDA and Non-Movement Area Driver
Training courses
• New Authorized Signatory training course
• New Airport Insider Threat training course
• New Airport Active Shooter training course
$15,000.00
Fees for ongoing support of Computer Based Training (CBT) Solutions The City shall pay AAAE for upgrade of existing CBT Courses and Software - One Time Annual Fee = $15,000.00
The City shall pay AAAE annually for ongoing IET support = $13,200.00 The City shall pay annually for ongoing Digicast support = $4,500.00 Employee Training Services Combined - $32,700.00 / first year Employee Training Services Combined - $17,700.00 / second year Employee Training Services Combined - $17,700.00 / third year Employee Training Services Combined Three Years – Total $68,100.00 NOTE: Airport Employee Vetting Services and Training Services to be Invoiced and Paid Separately.

Item 1O - Page 20
Exhibit “D”
Insurance

1. Procurement and Maintenance of Insurance. AAAE shall procure and maintain public liability and property damage insurance against all claims for injuries against persons or damages to property resulting from AAAE’s performance under this Agreement. AAAE shall procure and maintain all insurance at its sole cost and expense, in a form and content satisfactory to the City, and submit concurrently with its execution of this Agreement. AAAE shall also carry workers’ compensation insurance in accordance with California workers’ compensation laws. Such insurance shall be kept in full force and effect during the term of this Agreement, including any extensions. Such insurance shall not be cancelable without thirty (30) days advance written notice to City of any proposed cancellation. Certificates of insurance evidencing the foregoing and designating the City, its elected officials, officers, employees, agents, and volunteers as additional named insureds by original endorsement shall be delivered to and approved by City prior to commencement of services. The procuring of such insurance and the delivery of policies, certificates, and endorsements evidencing the same shall not be construed as a limitation of AAAE’s obligation to indemnify City, its elected officials, officers, agents, employees, and volunteers.

2. Minimum Scope of Insurance. The minimum amount of insurance required under this Agreement shall be as follows:

1. Comprehensive general liability and personal injury with limits of at least one million dollars ($1,000,000.00) combined single limit coverage per occurrence and two million dollars ($2,000,000) general aggregate;

2. Automobile liability insurance with limits of at least one million dollars ($1,000,000.00) per occurrence

3. Workers’ Compensation insurance in the statutory amount as required by the State of California and Employer’s Liability Insurance with limits of at least one million dollars $1 million per occurrence. If AAAE has no employees, AAAE shall complete the City’s Request for Waiver of Workers’ Compensation Insurance Requirement form.

4. Cyber Liability Insurance with limits not less than $2,000,000 per occurrence or claim, $2,000,000 aggregate. Coverage shall be sufficiently broad to respond to the duties and obligations as is undertaken by AAAE in this agreement and shall include, but not be limited to, claims involving infringement of intellectual property, including but not limited to infringement of copyright, trademark, trade dress, invasion of privacy violations, information theft, damage to or destruction of electronic information, release of private information, alteration of electronic information, extortion and network security.

The policy shall provide coverage for breach response costs as well as regulatory fines and penalties as well as credit monitoring expenses with limits sufficient to respond to these obligations.

Item 1O - Page 21

3. Primary Insurance. For any claims related to this Agreement, AAAE’s insurance coverage shall be primary with respect to the City and its respective elected officials, officers, employees, agents, and volunteers. Any insurance or self-insurance maintained by City and its respective elected officials, officers, employees, agents, and volunteers shall be in excess of AAAE’s insurance and shall not contribute with it. For Workers’ Compensation and Employer’s Liability Insurance only, the insurer shall waive all rights of subrogation and contribution it may have against City, its elected officials, officers, employees, agents, and volunteers.

4. Sufficiency of Insurers. Insurance required in this Agreement shall be provided by authorized insurers in good standing with the State of California. Coverage shall be provided by insurers admitted in the State of California with an A.M. Best’s Key Rating of B++, Class VII, or better, unless otherwise acceptable to the City.

5. Verification of Coverage. AAAE shall furnish City with both certificates of insurance and endorsements, including additional insured endorsements, affecting all of the coverages required by this Agreement. The certificates and endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. All proof of insurance is to be received and approved by the City before work commences. City reserves the right to require AAAE’s insurers to provide complete, certified copies of all required insurance policies at any time. Additional insured endorsements are not required for Errors and Omissions and Workers’ Compensation policies.

Verification of Insurance coverage may be provided by: (1) an approved General and/or Auto Liability Endorsement Form for the City of Palm Springs or (2) an acceptable Certificate of Liability Insurance Coverage with an approved Additional Insured Endorsement with the following endorsements stated on the certificate:

A. "The City of Palm Springs, its officials, employees, and agents are named as an additional insured…” ("as respects City of Palm Springs Contract No.___" or "for any and all work performed with the City" may be included in this statement).

B. "This insurance is primary and non-contributory over any insurance or selfinsurance the City may have..." ("as respects City of Palm Springs Contract No.___" or "for any and all work performed with the City" may be included in this statement).

C. "Should any of the above-described policies be canceled before the expiration date thereof, the issuing company will mail 30 days written notice to the Certificate Holder named." Language such as, “endeavor to” mail and "but failure to mail such notice shall impose no obligation or liability of any kind upon the company, its agents or representative" is not acceptable and must be crossed out.

D. The Workers’ Compensation policy shall contain the insurer's waiver of subrogation in favor of City, its elected officials, officers, employees, agents, and volunteers.

Item 1O - Page 22
In addition to the endorsements listed above, the City of Palm Springs shall be named the certificate holder on the policies.

All certificates of insurance and endorsements are to be received and approved by the City before work commences. All certificates of insurance must be authorized by a person with authority to bind coverage, whether that is the authorized agent/broker or insurance underwriter. Failure to obtain the required documents prior to the commencement of work shall not waive the AAAE’s obligation to provide them.

6. Deductibles and Self-Insured Retentions. Any deductibles or selfinsured retentions must be declared to and approved by the City prior to commencing any work or services under this Agreement. At the option of the City, either (1) the insurer shall reduce or eliminate such deductibles or self-insured retentions with respect to the City, its elected officials, officers, employees, agents, and volunteers; or (2) AAAE shall procure a bond guaranteeing payment of losses and related investigations, claim administration, and defense expenses. Certificates of Insurance must include evidence of the amount of any deductible or self-insured retention under the policy. AAAE guarantees payment of all deductibles and self-insured retentions.

7. Severability of Interests (Separation of Insureds). This insurance applies separately to each insured against whom claim is made or suit is brought except with respect to the limits of the insurer’s liability.

Item 1O - Page 23
Exhibit “E”

FEDERAL AVIATION ADMINISTRATION

FEDERAL PROVISIONS
Provision
Reference Provision Description
Page
No.

FAA - 01 Access to Records and Reports 2
FAA - 02 Affirmative Action Requirement * 3
FAA – 03 Breach of Contract Terms 5
FAA – 04 Buy American Preference * 6
FAA – 05 Civil Rights General 7
FAA – 06 Civil Rights – Title VI Assurances * 8
FAA – 07 Clean Air and Water Pollution Control 11
FAA – 08 Contract Work Hours and Safety Standards Act
Requirements
12 FAA – 09 Copeland Anti-Kickback Act 14
FAA – 10 Davis Bacon Requirements 15
FAA – 11 Debarment and Suspension * 22
FAA – 12 Disadvantaged Business Enterprise * 23
FAA – 13 Distracted Driving 25
FAA – 14 Prohibition on Certain Telecommunications and Video Surveillance Services or Equipment
26 FAA – 15 Drug Free Workplace Requirements (not applicable to Contractors)
27 FAA – 16 Equal Employment Opportunity 28
FAA – 17 Federal Fair Labor Standards Act * 36
FAA – 18 Lobbying and Influencing Federal Employees 37
FAA – 19 Prohibition of Segregated Facilities 38
FAA – 20 Occupational Safety and Health Act of 1970 39
FAA – 21 Procurement of Recovered Materials * 40
FAA – 22 Right to Inventions 41
FAA – 23 Seismic Safety 42
FAA – 24 Tax Delinquency and Felony Convictions* 43
FAA – 25 Termination of Contract 44
FAA – 26 Trade Restriction Certification (Foreign) * 45 FAA – 27 Veteran’s Preference 47
FAA – 28 Domestic Preferences for Procurements * 48
*Solicitation Clause also
Updated 2.8.2023
Item 1O - Page 24
FAA - 01 Access to Records and Reports
APPLICABILITY – pertains to all contracts.

The Contractor must maintain an acceptable cost accounting system. The Contractor agrees to provide the City, the Federal Aviation Administration and the Comptroller General of the United States or any of their duly authorized representatives access to any books, documents, papers and records of the Contractor which are directly pertinent to the specific contract for the purpose of making audit, examination, excerpts and transcriptions. The Contractor agrees to maintain all books, records and reports required under this contract for a period of not less than three years after final payment is made and all pending matters are closed.

Reference: 2 CFR § 200.334, 2 CFR § 200.337, FAA Order 5100.38 Item 1O - Page 25
FAA - 02 Affirmative Action Requirement

NOTICE OF REQUIREMENT FOR AFFIRMATIVE ACTION TO

ENSURE EQUAL EMPLOYMENT OPPORTUNITY
APPLICABILITY – pertains to all contracts over $10,000 as follows:

Construction – AIP funded construction work contracts and subcontracts that exceed $10,000. Construction work means construction, rehabilitation, alteration, conversion, extension, demolition or repair of buildings, highways or other changes or improvements to real property, including facilities providing utility services. The term also includes the supervision, inspection and other onsite functions incidental to the actual construction.

Equipment – any equipment project exceeding $10,000 that involves installation of equipment onsite (e.g., electrical vault equipment). This provision does not apply to equipment acquisition projects where the manufacture of the equipment takes place offsite at a manufacturer’s plant (e.g., firefighting and snow removal vehicles).

Professional Services – any professional service agreement if the professional services agreement includes tasks that meet the definition of construction work [as defined by the U.S. Department of Labor (DOL)] and exceeds $10,000. Examples include installation of monitoring systems (e.g., noise, environmental, etc.).

Property/Land – any agreement associated with land acquisition if the agreement includes construction work (defined above) that exceeds $10,000. Examples include demolition of structures or installation of boundary fencing.

REQUIREMENTS -

1. The Contractor’s attention is called to the “Equal Opportunity Clause” and the “Standard Federal Equal Employment Opportunity Construction Contract Specifications” set forth herein.

2. The goals and timetables for minority and female participation, expressed in percentage terms for the Contractor’s aggregate workforce in each trade on all construction work in the covered area, are as follows:

Timetables
Goals for minority participation for each trade: Does Not Apply Goals for female participation in each trade: N/A
These goals are applicable to all of the Contractor’s construction work (whether or not it is Federal or federally assisted) performed in the covered area. If the Contractor performs construction work in a geographical area located outside of the covered area, it shall apply the goals established for such geographical area where the work is actually performed. With regard to this second area, the Contractor also is subject to the goals for both its federally involved and nonfederally involved construction.

The Contractor’s compliance with the Executive Order and the regulations in 41 CFR Part 60-4 shall be based on its implementation of the Equal Opportunity Clause, specific affirmative action obligations required by the specifications set forth in 41 CFR 60-4.3(a) Item 1O - Page 26
and its efforts to meet the goals. The hours of minority and female employment and training must be substantially uniform throughout the length of the contract, and in each trade, and the Contractor shall make a good faith effort to employ minorities and women evenly on each of its projects. The transfer of minority or female employees or trainees from Contractor to Contractor or from project to project for the sole purpose of meeting the Contractor’s goals shall be a violation of the contract, the Executive Order and the regulations in 41 CFR Part 60-4. Compliance with the goals will be measured against the total work hours performed.

3. The Contractor shall provide written notification to the Director of the Office of Federal Contract Compliance Programs (OFCCP) within 10 working days of award of any construction subcontract in excess of $10,000 at any tier for construction work under the contract resulting from this solicitation. The notification shall list the name, address, and telephone number of the subcontractor; employer identification number of the subcontractor; estimated dollar amount of the subcontract; estimated starting and completion dates of the subcontract; and the geographical area in which the subcontract is to be performed.

4. As used in this notice and in the contract resulting from this solicitation, the “covered area” is California, Riverside County, Palm Springs.

Reference: 41 CFR Part 60-4
Item 1O - Page 27
FAA – 03 Breach of Contract
APPLICABILITY – required for all contracts that exceed the simplified acquisition threshold as stated in 2 CFR Part 200, Appendix II (A). This threshold is occasionally adjusted for inflation and is $250,000.

REQUIREMENT -
See Section 4.5 of the Agreement.

Reference: 2 CFR § 200 Appendix II(A)
Item 1O - Page 28
FAA – 04 Buy American Preferences
APPLICABILITY – required for contracts defined as follows:
• Construction Projects involving the replacement, rehabilitation, reconstruction of airfield surfaces such as on runways, taxiways, taxilanes, aprons, roadways, parking lots, etc. – Insert the Certificate of compliance to FAA Buy American Preference based on Construction Projects.
• Equipment and Buildings Projects involving and including the acquisition of equipment such as snow removal equipment, navigational aids, wind cones, and the construction of buildings such as hangars, terminal development, lighting vaults, aircraft rescue & firefighting buildings, etc. - Insert the Certificate of Compliance with FAA Buy American Preference Based on Equipment/Building Projects.

REQUIREMENT -
The Contractor certifies that all constructions materials, defined to mean an article, material, or supply other than an item of primarily iron or steel; a manufactured product; cement and cementitious materials; aggregates such as stone, sand, or gravel; or aggregate binding agents or additives that are or consist primarily of: non-ferrous metals; plastic and polymer-based products (including polyvinylchloride, composite building materials, and polymers used in fiber optic cables); glass (including optic glass); lumber; or drywall used in the project are manufactured in the U.S.

Reference: Title 49 USC § 50101
Item 1O - Page 29
FAA – 05 Civil Rights General
APPLICABILITY – required for all contracts regardless of funding source.

REQUIREMENT -
In all its activities within the scope of its airport program, the Contractor agrees to comply with pertinent statutes, Executive Orders, and such rules as identified in Title VI List of Pertinent Nondiscrimination Acts and Authorities to ensure that no person shall, on the grounds of race, color, national origin (including limited English proficiency), creed, sex (including sexual orientation and gender identity), age, or disability be excluded from participating in any activity conducted with or benefiting from Federal assistance. The above provision binds the Contractor and subcontractors from the bid solicitation period through the completion of the contract.

This provision is in addition to that required by Title VI of the Civil Rights Act of 1964.

Reference: 49 USC § 47123
Item 1O - Page 30
FAA – 06 Civil Rights – Title VI Assurances
APPLICABILITY – required for all contracts.

REQUIREMENT -
Title VI List of Pertinent Nondiscrimination Acts and Authorities During the performance of this contract, the Contractor, for itself, its assignees, and successors in interest (hereinafter referred to as the “Contractor”) agrees to comply with the following non-discrimination statutes and authorities; including but not limited to:
• Title VI of the Civil Rights Act of 1964 (42 USC § 2000d et seq., 78 stat. 252) (prohibits discrimination on the basis of race, color, national origin); • 49 CFR part 21 (Non-discrimination in Federally-Assisted programs of the Department of Transportation—Effectuation of Title VI of the Civil Rights Act of 1964); • The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, (42 USC § 4601) (prohibits unfair treatment of persons displaced or whose property has been acquired because of Federal or Federal-aid programs and projects); • Section 504 of the Rehabilitation Act of 1973 (29 USC § 794 et seq.), as amended (prohibits discrimination on the basis of disability); and 49 CFR part 27 (Nondiscrimination on the Basis of Disability in Programs or Activities Receiving Federal Financial Assistance);
• The Age Discrimination Act of 1975, as amended (42 USC § 6101 et seq.) (prohibits discrimination on the basis of age);
• Airport and Airway Improvement Act of 1982 (49 USC § 47123), as amended (prohibits discrimination based on race, creed, color, national origin, or sex); • The Civil Rights Restoration Act of 1987 (PL 100-259) (broadened the scope, coverage and applicability of Title VI of the Civil Rights Act of 1964, the Age Discrimination Act of 1975 and Section 504 of the Rehabilitation Act of 1973, by expanding the definition of the terms “programs or activities” to include all of the programs or activities of the Federal-aid recipients, sub-recipients and contractors, whether such programs or activities are Federally funded or not);
• Titles II and III of the Americans with Disabilities Act of 1990 (42 USC § 12101, et seq) (prohibit discrimination on the basis of disability in the operation of public entities, public and private transportation systems, places of public accommodation, and certain testing entities) as implemented by U.S. Department of Transportation regulations at 49 CFR parts 37 and 38;
• The Federal Aviation Administration’s Nondiscrimination statute (49 USC § 47123) (prohibits discrimination on the basis of race, color, national origin, and sex); • Executive Order 12898, Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations (ensures nondiscrimination against minority populations by discouraging programs, policies, and activities with disproportionately high Item 1O - Page 31
and adverse human health or environmental effects on minority and low-income populations);
• Executive Order 13166, Improving Access to Services for Persons with Limited English Proficiency, and resulting agency guidance, national origin discrimination includes discrimination because of limited English proficiency (LEP). To ensure compliance with Title VI, you must take reasonable steps to ensure that LEP persons have meaningful access to your programs [70 Fed. Reg. 74087 (2005)];
• Title IX of the Education Amendments of 1972, as amended, which prohibits you from discriminating because of sex in education programs or activities (20 USC § 1681, et seq).

Compliance with Nondiscrimination Requirements:

During the performance of this contract, the Contractor, for itself, its assignees, and successors in interest (hereinafter referred to as the “Contractor”), agrees as follows:

1. Compliance with Regulations: The Contractor (hereinafter includes consultants) will comply with the Title VI List of Pertinent Nondiscrimination Acts and Authorities, as they may be amended from time to time, which are herein incorporated by reference and made a part of this contract.

2. Nondiscrimination: The Contractor, with regard to the work performed by it during the contract, will not discriminate on the grounds of race, color, national origin (including limited English proficiency), creed, sex (including sexual orientation and gender identity), age, or disability in the selection and retention of subcontractors, including procurements of materials and leases of equipment. The Contractor will not participate directly or indirectly in the discrimination prohibited by the Nondiscrimination Acts and Authorities, including employment practices when the contract covers any activity, project, or program set forth in Appendix B of 49 CFR part 21.

3. Solicitations for Subcontracts, including Procurements of Materials and Equipment: In all solicitations, either by competitive bidding or negotiation made by the Contractor for work to be performed under a subcontract, including procurements of materials, or leases of equipment, each potential subcontractor or supplier will be notified by the Contractor of the Contractor’s obligations under this contract and the Nondiscrimination Acts and Authorities on the grounds of race, color, or national origin.

4. Information and Reports: The Contractor will provide all information and reports required by the Acts, the Regulations, and directives issued pursuant thereto and will permit access to its books, records, accounts, other sources of information, and its facilities as may be determined by the City or the Federal Aviation Administration to be pertinent to ascertain compliance with such Nondiscrimination Acts and Authorities and instructions. Where any information required of a Contractor is in the exclusive possession of another who fails or refuses to furnish the information, the Contractor will so certify to the City or the Federal Aviation Administration, as appropriate, and will set forth what efforts it has made to obtain the information.

Item 1O - Page 32

5. Sanctions for Noncompliance: In the event of a Contractor’s noncompliance with the non-discrimination provisions of this contract, the City will impose such contract sanctions as it or the Federal Aviation Administration may determine to be appropriate, including, but not limited to:
a. Withholding payments to the Contractor under the contract until the Contractor complies; and/or
b. Cancelling, terminating, or suspending a contract, in whole or in part.

6. Incorporation of Provisions: The Contractor will include the provisions of paragraphs one through six in every subcontract, including procurements of materials and leases of equipment, unless exempt by the Acts, the Regulations, and directives issued pursuant thereto. The Contractor will take action with respect to any subcontract or procurement as the City or the Federal Aviation Administration may direct as a means of enforcing such provisions including sanctions for noncompliance. Provided, that if the Contractor becomes involved in, or is threatened with litigation by a subcontractor, or supplier because of such direction, the Contractor may request the City to enter into any litigation to protect the interests of the City. In addition, the Contractor may request the United States to enter into the litigation to protect the interests of the United States.

Reference: 49 USC § 47123, FAA Order 1400.11
Item 1O - Page 33
FAA – 07 Clean Air/Water Pollution Control
APPLICABILITY – This provision is required for all contracts and lower tier contracts that exceed $150,000.

REQUIREMENT -
If the Agreement exceeds $150,000, Contractor agrees to comply with all applicable standards, orders, and regulations issued pursuant to the Clean Air Act (42 USC § 7401- 7671q) and the Federal Water Pollution Control Act as amended (33 USC § 1251-1387).

The Contractor agrees to report any violation to the City immediately upon discovery. The City assumes responsibility for notifying the Environmental Protection Agency (EPA) and the Federal Aviation Administration.

Contractor must include this requirement in all subcontracts that exceeds $150,000.

Reference: 2 CFR § 200, Appendix II(G); 42 USC § 7401; 33 USC § 1251 Item 1O - Page 34
FAA – 08 Contract Work Hours and Safety Standards
APPLICABILITY – This provision is required for contracts as follows:

Contract Work Hours and Safety Standards Act Requirements (CWHSSA) (40 USC §§ 3702 & 3704) requires contractors and subcontractors on covered contracts to pay laborers and mechanics employed in the performance of the contracts not less than one and one-half times their basic rate of pay for all hours worked over 40 in a workweek. CWHSSA prohibits unsanitary, hazardous, or dangerous working conditions on federally-assisted projects. The Wage and Hour Division (WHD) within the U.S. Department of Labor (DOL) enforces the compensation requirements of this Act, while DOL’s Occupational Safety and Health Administration (OSHA) enforces the safety and health requirements.

Contract Types –
Construction – This provision applies to all contracts and lower tier contracts that exceed $100,000, and employ laborers, mechanics, watchmen, and guards.

Equipment – This provision applies to any equipment project exceeding $100,000 that involves installation of equipment onsite (e.g., electrical vault equipment). This provision does not apply to equipment acquisition projects where the manufacture of the equipment takes place offsite at the vendor plant (e.g., ARFF and SRE vehicles).

Professional Services – This provision applies to professional service agreements that exceed $100,000 and employs laborers, mechanics, watchmen, and guards. This includes members of survey crews and exploratory drilling operations.

Property – While most land transactions do not involve employment of laborers, mechanics, watchmen, and guards, under certain circumstances, a property acquisition project could require such employment. Examples include the installation of property fencing or testing for environmental contamination

CONTRACT WORKHOURS AND SAFETY STANDARDS ACT REQUIREMENTS

1. Overtime Requirements.

No contractor or subcontractor contracting for any part of the contract work which may require or involve the employment of laborers or mechanics shall require or permit any such laborer or mechanic, including watchmen and guards, in any workweek in which he or she is employed on such work to work in excess of forty hours in such workweek unless such laborer or mechanic receives compensation at a rate not less than one and one-half times the basic rate of pay for all hours worked in excess of forty hours in such workweek.

2. Violation; Liability for Unpaid Wages; Liquidated Damages.

In the event of any violation of the clause set forth in paragraph (1) of this clause, the Contractor and any subcontractor responsible therefor shall be liable for the unpaid wages. In addition, such contractor and subcontractor shall be liable to the United States (in the case of work done under contract for the District of Columbia or a territory, to such District or to such territory), for liquidated damages. Such liquidated damages shall be computed with respect to each individual laborer or mechanic, including watchmen and guards, employed in violation of the clause set forth in paragraph (1) of this clause, in the sum of $29 for each calendar day on Item 1O - Page 35
which such individual was required or permitted to work in excess of the standard workweek of forty hours without payment of the overtime wages required by the clause set forth in paragraph (1) of this clause.

3. Withholding for Unpaid Wages and Liquidated Damages.

The Federal Aviation Administration (FAA) or the City shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld, from any moneys payable on account of work performed by the Contractor or subcontractor under any such contract or any other Federal contract with the same prime Contractor, or any other federally-assisted contract subject to the Contract Work Hours and Safety Standards Act, which is held by the same prime Contractor, such sums as may be determined to be necessary to satisfy any liabilities of such Contractor or subcontractor for unpaid wages and liquidated damages as provided in the clause set forth in paragraph (2) of this clause.

4. Subcontractors.

The Contractor or subcontractor shall insert in any subcontracts the clauses set forth in paragraphs (1) through (4) and also a clause requiring the subcontractor to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible for compliance by any subcontractor or lower tier subcontractor with the clauses set forth in paragraphs (1) through (4) of this clause.

Reference: 2 CFR Part 200, Appendix II(E); 2 CFR § 5.5(b); 40 USC § 3702; 40 USC § 3704
Item 1O - Page 36
FAA – 09 Copeland Anti-Kickback

APPLICABILITY -
The Copeland (Anti-Kickback) Act (18 USC § 874 and 40 USC § 3145) makes it unlawful to induce by force, intimidation, threat of dismissal from employment, or by any other manner, any person employed in the construction or repair of public buildings or public works, financed in whole or in part by the United States, to give up any part of the compensation to which that person is entitled under a contract of employment. The Copeland Act also requires each contractor and subcontractor to furnish weekly a statement of compliance with respect to the wages paid each employee during the preceding week.

Contract Types –
Construction – This provision applies to all construction contracts and subcontracts financed under the AIP that exceed $2,000.

Equipment – This provision applies to all equipment installation projects (e.g., electrical vault improvements) financed under the AIP that exceed $2,000. This provision does not apply to equipment acquisitions where the equipment is manufactured at the vendor’s plant (e.g., SRE and ARFF vehicles).

Professional Services –The emergence of different project delivery methods has created situations where Professional Service Agreements (PSAs) include tasks that meet the definition of construction, alteration, or repair as defined in 29 CFR Part 5. If such tasks result in work that qualifies as construction, alteration, or repair and it exceeds $2,000, the PSA must incorporate the Copeland Anti-kickback provision.

Property –Ordinarily, land acquisition projects would not involve employment of laborers or mechanics and thus the Copeland Anti-Kickback provision would not apply. However, land projects that involve installation of boundary fencing and demolition of structures would involve laborers and mechanics. The City must include this provision if the land acquisition project involves employment of laborers or mechanics for a contract exceeding $2,000.

REQUIREMENT -
Contractor must comply with the requirements of the Copeland “Anti-Kickback” Act (18 USC 874 and 40 USC 3145), as supplemented by Department of Labor regulation 29 CFR part 3. Contractor and subcontractors are prohibited from inducing, by any means, any person employed on the project to give up any part of the compensation to which the employee is entitled. The Contractor and each Subcontractor must submit to the City, a weekly statement on the wages paid to each employee performing on covered work during the prior week. City must report any violations of the Act to the Federal Aviation Administration.

Reference: 2 CFR Part 200, Appendix II(D); 29 CFR Parts 3 and 5 Item 1O - Page 37
FAA – 10 Davis Bacon Requirements

APPLICABILITY -
The Davis-Bacon Act (40 USC §§ 3141-3144, 3146, and 3147) ensures that laborers and mechanics employed under the contract receive pay no less than the locally prevailing wages and fringe benefits as determined by the Department of Labor.

Contract Types –
Construction –all construction contracts and subcontracts that exceed $2,000 and include funding from the AIP.

Equipment – This provision applies to all equipment installation projects (e.g., electrical vault improvements) financed under the AIP that exceed $ 2,000. This provision does not apply to equipment acquisitions where the equipment is manufactured at the vendor’s plant (e.g., SRE and ARFF vehicles)
Professional Services – The emergence of different project delivery methods has created situations where Professional Service Agreements (PSAs) includes tasks that meet the definition of construction, alteration, or repair as defined in 29 CFR Part 5. If such tasks result in work that qualifies as construction, alteration, or repair and it exceeds $2,000, the PSA must incorporate this clause.

Property – Ordinarily, land acquisition projects would not involve employment of laborers or mechanics and thus the provision would not apply. However, land projects that involve installation of boundary fencing and demolition of structures would involve laborers and mechanics. The City must include this provision if the land acquisition project involves employment of laborers or mechanics for a contract exceeding $2,000.

Fencing Projects – Fencing projects that exceed $2,000 must include this provision.

DAVIS-BACON REQUIREMENTS

1. Minimum Wages.
(i) All laborers and mechanics employed or working upon the site of the work will be paid unconditionally and not less often than once a week, and without subsequent deduction or rebate on any account (except such payroll deductions as are permitted by the Secretary of Labor under the Copeland Act (29 CFR Part 3)), the full amount of wages and bona fide fringe benefits (or cash equivalent thereof) due at time of payment computed at rates not less than those contained in the wage determination of the Secretary of Labor which is attached hereto and made a part hereof, regardless of any contractual relationship which may be alleged to exist between the Contractor and such laborers and mechanics.

Contributions made or costs reasonably anticipated for bona fide fringe benefits under section 1(b)(2) of the Davis-Bacon Act on behalf of laborers or mechanics are considered wages paid to such laborers or mechanics, subject to the provisions of paragraph (1)(iv) of this section; also, regular contributions made or costs incurred for more than a weekly period (but not less often than quarterly) under plans, funds, or programs which cover the particular weekly period, are deemed to be constructively made or incurred during such Item 1O - Page 38
weekly period. Such laborers and mechanics shall be paid the appropriate wage rate and fringe benefits on the wage determination for the classification of work actually performed, without regard to skill, except as provided in 29 CFR § 5.5(a)(4). Laborers or mechanics performing work in more than one classification may be compensated at the rate specified for each classification for the time actually worked therein: Provided, that the employer’s payroll records accurately set forth the time spent in each classification in which work is performed. The wage determination (including any additional classification and wage rates conformed under (1)(ii) of this section) and the Davis-Bacon poster (WH-1321) shall be posted at all times by the Contractor and its subcontractors at the site of the work in a prominent and accessible place where it can easily be seen by the workers. (ii)(A) The contracting officer shall require that any class of laborers or mechanics, including helpers, which is not listed in the wage determination and which is to be employed under the contract shall be classified in conformance with the wage determination. The contracting officer shall approve an additional classification and wage rate and fringe benefits therefore only when the following criteria have been met:
(1) The work to be performed by the classification requested is not performed by a classification in the wage determination;
(2) The classification is utilized in the area by the construction industry; and (3) The proposed wage rate, including any bona fide fringe benefits, bears a reasonable relationship to the wage rates contained in the wage determination. (B) If the Contractor and the laborers and mechanics to be employed in the classification (if known), or their representatives, and the contracting officer agree on the classification and wage rate (including the amount designated for fringe benefits where appropriate), a report of the action taken shall be sent by the contracting officer to the Administrator of the Wage and Hour Division, U.S. Department of Labor, Washington, DC 20210. The Administrator, or an authorized representative, will approve, modify, or disapprove every additional classification action within 30 days of receipt and so advise the contracting officer or will notify the contracting officer within the 30-day period that additional time is necessary.
(C) In the event the Contractor, the laborers, or mechanics to be employed in the classification, or their representatives, and the contracting officer do not agree on the proposed classification and wage rate (including the amount designated for fringe benefits, where appropriate), the contracting officer shall refer the questions, including the views of all interested parties and the recommendation of the contracting officer, to the Administrator for determination. The Administrator, or an authorized representative, will issue a determination within 30 days of receipt and so advise the contracting officer or will notify the contracting officer within the 30-day period that additional time is necessary. (D) The wage rate (including fringe benefits where appropriate) determined pursuant to subparagraphs (1)(ii) (B) or (C) of this paragraph, shall be paid to all workers performing work in the classification under this contract from the first day on which work is performed in the classification.

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(iii) Whenever the minimum wage rate prescribed in the contract for a class of laborers or mechanics includes a fringe benefit which is not expressed as an hourly rate, the contractor shall either pay the benefit as stated in the wage determination or shall pay another bona fide fringe benefit or an hourly cash equivalent thereof. (iv) If the Contractor does not make payments to a trustee or other third person, the Contractor may consider as part of the wages of any laborer or mechanic the amount of any costs reasonably anticipated in providing bona fide fringe benefits under a plan or program, Provided, that the Secretary of Labor has found, upon the written request of the Contractor, that the applicable standards of the Davis-Bacon Act have been met. The Secretary of Labor may require the Contractor to set aside in a separate account assets for the meeting of obligations under the plan or program.

2. Withholding. The Federal Aviation Administration or the CIty shall upon its own action or upon written request of an authorized representative of the Department of Labor withhold or cause to be withheld from the Contractor under this contract or any other Federal contract with the same prime contractor, or any other federally-assisted contract subject to Davis-Bacon prevailing wage requirements, which is held by the same prime contractor, so much of the accrued payments or advances as may be considered necessary to pay laborers and mechanics, including apprentices, trainees, and helpers, employed by the Contractor or any subcontractor the full amount of wages required by the contract. In the event of failure to pay any laborer or mechanic, including any apprentice, trainee, or helper, employed or working on the site of the work, all or part of the wages required by the contract, the Federal Aviation Administration may, after written notice to the Contractor, City, Applicant, or Owner, take such action as may be necessary to cause the suspension of any further payment, advance, or guarantee of funds until such violations have ceased.

3. Payrolls and Basic Records.
(i) Payrolls and basic records relating thereto shall be maintained by the Contractor during the course of the work and preserved for a period of three years thereafter for all laborers and mechanics working at the site of the work. Such records shall contain the name, address, and social security number of each such worker; his or her correct classification; hourly rates of wages paid (including rates of contributions or costs anticipated for bona fide fringe benefits or cash equivalents thereof of the types described in 1(b)(2)(B) of the Davis-Bacon Act); daily and weekly number of hours worked; deductions made; and actual wages paid. Whenever the Secretary of Labor has found under 29 CFR 5.5(a)(1)(iv) that the wages of any laborer or mechanic include the amount of any costs reasonably anticipated in providing benefits under a plan or program described in section 1(b)(2)(B) of the Davis-Bacon Act, the Contractor shall maintain records that show that the commitment to provide such benefits is enforceable, that the plan or program is financially responsible, and that the plan or program has been communicated in writing to the laborers or mechanics affected, and records which show the costs anticipated or the actual costs incurred in providing such benefits. Contractors employing apprentices or trainees under approved programs shall maintain written evidence of the registration of apprenticeship programs and certification of trainee programs, the registration of the apprentices and trainees, and the ratios and wage rates prescribed in the applicable programs.

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(ii)(A) The Contractor shall submit weekly for each week in which any contract work is performed a copy of all payrolls to the Federal Aviation Administration if the agency is a party to the contract, but if the agency is not such a party, the Contractor will submit the payrolls to the applicant, the City, or Owner, as the case may be, for transmission to the Federal Aviation Administration. The payrolls submitted shall set out accurately and completely all of the information required to be maintained under 29 CFR § 5.5(a)(3)(i), except that full social security numbers and home addresses shall not be included on weekly transmittals. Instead the payrolls shall only need to include an individually identifying number for each employee (e.g., the last four digits of the employee’s social security number). The required weekly payroll information may be submitted in any form desired. Optional Form WH–347 is available for this purpose from the Wage and Hour Division Web site at http://www.dol.gov/esa/whd/forms/wh347instr.htm or its successor site. The prime contractor is responsible for the submission of copies of payrolls by all subcontractors. Contractors and subcontractors shall maintain the full social security number and current address of each covered worker and shall provide them upon request to the Federal Aviation Administration if the agency is a party to the contract, but if the agency is not such a party, the Contractor will submit them to the applicant, the City, or Owner, as the case may be, for transmission to the Federal Aviation Administration, the Contractor, or the Wage and Hour Division of the Department of Labor for purposes of an investigation or audit of compliance with prevailing wage requirements. It is not a violation of this section for a prime contractor to require a subcontractor to provide addresses and social security numbers to the prime contractor for its own records, without weekly submission to the sponsoring government agency (or the applicant, City, or Owner). (B) Each payroll submitted shall be accompanied by a "Statement of Compliance," signed by the Contractor or subcontractor or his or her agent who pays or supervises the payment of the persons employed under the contract and shall certify the following:
(1) That the payroll for the payroll period contains the information required to be provided under 29 CFR § 5.5(a)(3)(ii), the appropriate information is being maintained under 29 CFR § 5.5 (a)(3)(i), and that such information is correct and complete; (2) That each laborer and mechanic (including each helper, apprentice, and trainee) employed on the contract during the payroll period has been paid the full weekly wages earned, without rebate, either directly or indirectly, and that no deductions have been made either directly or indirectly from the full wages earned, other than permissible deductions as set forth in Regulations, 29 CFR Part 3;
(3) That each laborer or mechanic has been paid not less than the applicable wage rates and fringe benefits or cash equivalents for the classification of work performed, as specified in the applicable wage determination incorporated into the contract. (C) The weekly submission of a properly executed certification set forth on the reverse side of Optional Form WH-347 shall satisfy the requirement for submission of the “Statement of Compliance” required by paragraph (3)(ii)(B) of this section. (D) The falsification of any of the above certifications may subject the Contractor or subcontractor to civil or criminal prosecution under Section 1001 of Title 18 and Section 231 of Title 31 of the United States Code.

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(iii) The Contractor or subcontractor shall make the records required under paragraph (3)(i) of this section available for inspection, copying, or transcription by authorized representatives of the City, the Federal Aviation Administration, or the Department of Labor and shall permit such representatives to interview employees during working hours on the job. If the Contractor or subcontractor fails to submit the required records or to make them available, the Federal agency may, after written notice to the Contractor, the City, applicant, or Owner, take such action as may be necessary to cause the suspension of any further payment, advance, or guarantee of funds. Furthermore, failure to submit the required records upon request or to make such records available may be grounds for debarment action pursuant to 29 CFR § 5.12.

4. Apprentices and Trainees.
(i) Apprentices. Apprentices will be permitted to work at less than the predetermined rate for the work they performed when they are employed pursuant to and individually registered in a bona fide apprenticeship program registered with the U.S. Department of Labor, Employment and Training Administration, Office of Apprenticeship Training, Employer and Labor Services, or with a State Apprenticeship Agency recognized by the Office, or if a person is employed in his or her first 90 days of probationary employment as an apprentice in such an apprenticeship program, who is not individually registered in the program, but who has been certified by the Office of Apprenticeship Training, Employer and Labor Services or a State Apprenticeship Agency (where appropriate) to be eligible for probationary employment as an apprentice. The allowable ratio of apprentices to journeymen on the job site in any craft classification shall not be greater than the ratio permitted to the contractor as to the entire work force under the registered program. Any worker listed on a payroll at an apprentice wage rate, who is not registered or otherwise employed as stated above, shall be paid not less than the applicable wage rate on the wage determination for the classification of work actually performed. In addition, any apprentice performing work on the job site in excess of the ratio permitted under the registered program shall be paid not less than the applicable wage rate on the wage determination for the work actually performed. Where a contractor is performing construction on a project in a locality other than that in which its program is registered, the ratios and wage rates (expressed in percentages of the journeyman’s hourly rate) specified in the Contractor’s or subcontractor’s registered program shall be observed.

Every apprentice must be paid at not less than the rate specified in the registered program for the apprentice’s level of progress, expressed as a percentage of the journeymen hourly rate specified in the applicable wage determination. Apprentices shall be paid fringe benefits in accordance with the provisions of the apprenticeship program. If the apprenticeship program does not specify fringe benefits, apprentices must be paid the full amount of fringe benefits listed on the wage determination for the applicable classification.

If the Administrator determines that a different practice prevails for the applicable apprentice classification, fringes shall be paid in accordance with that determination. In the event the Office of Apprenticeship Training, Employer and Labor Services, or a State Apprenticeship Agency recognized by the Office, withdraws approval of an apprenticeship program, the Contractor will no longer be permitted to utilize apprentices at less than the applicable predetermined rate for the work performed until an acceptable program is approved.

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(ii) Trainees. Except as provided in 29 CFR § 5.16, trainees will not be permitted to work at less than the predetermined rate for the work performed unless they are employed pursuant to and individually registered in a program which has received prior approval, evidenced by formal certification by the U.S. Department of Labor, Employment and Training Administration. The ratio of trainees to journeymen on the job site shall not be greater than permitted under the plan approved by the Employment and Training Administration. Every trainee must be paid at not less than the rate specified in the approved program for the trainee’s level of progress, expressed as a percentage of the journeyman hourly rate specified in the applicable wage determination. Trainees shall be paid fringe benefits in accordance with the provisions of the trainee program. If the trainee program does not mention fringe benefits, trainees shall be paid the full amount of fringe benefits listed on the wage determination unless the Administrator of the Wage and Hour Division determines that there is an apprenticeship program associated with the corresponding journeyman wage rate on the wage determination that provides for less than full fringe benefits for apprentices. Any employee listed on the payroll at a trainee rate that is not registered and participating in a training plan approved by the Employment and Training Administration shall be paid not less than the applicable wage rate on the wage determination for the classification of work actually performed. In addition, any trainee performing work on the job site in excess of the ratio permitted under the registered program shall be paid not less than the applicable wage rate on the wage determination for the work actually performed. In the event the Employment and Training Administration withdraws approval of a training program, the Contractor will no longer be permitted to utilize trainees at less than the applicable predetermined rate for the work performed until an acceptable program is approved.
(iii) Equal Employment Opportunity. The utilization of apprentices, trainees, and journeymen under this part shall be in conformity with the equal employment opportunity requirements of Executive Order 11246, as amended, and 29 CFR Part 30.

5. Compliance with Copeland Act Requirements.

The Contractor shall comply with the requirements of 29 CFR Part 3, which are incorporated by reference in this contract.

6. Subcontracts.

The Contractor or subcontractor shall insert in any subcontracts the clauses contained in 29 CFR §§ 5.5(a)(1) through (10) and such other clauses as the Federal Aviation Administration may by appropriate instructions require, and also a clause requiring the subcontractors to include these clauses in any lower tier subcontracts. The prime contractor shall be responsible for the compliance by any subcontractor or lower tier subcontractor with all the contract clauses in 29 CFR § 5.5.

7. Contract Termination: Debarment.

A breach of the contract clauses in paragraph 1 through 10 of this section may be grounds for termination of the contract, and for debarment as a contractor and a subcontractor as provided in 29 CFR § 5.12.

8. Compliance with Davis-Bacon and Related Act Requirements.

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All rulings and interpretations of the Davis-Bacon and Related Acts contained in 29 CFR Parts 1, 3, and 5 are herein incorporated by reference in this contract.

9. Disputes Concerning Labor Standards.

Disputes arising out of the labor standards provisions of this contract shall not be subject to the general disputes clause of this contract. Such disputes shall be resolved in accordance with the procedures of the Department of Labor set forth in 29 CFR Parts 5, 6, and 7. Disputes within the meaning of this clause include disputes between the Contractor (or any of its subcontractors) and the contracting agency, the U.S. Department of Labor, or the employees or their representatives.

10. Certification of Eligibility.
(i) By entering into this contract, the Contractor certifies that neither it (nor he or she) nor any person or firm who has an interest in the Contractor’s firm is a person or firm ineligible to be awarded Government contracts by virtue of section 3(a) of the Davis-Bacon Act or 29 CFR § 5.12(a)(1).
(ii) No part of this contract shall be subcontracted to any person or firm ineligible for award of a Government contract by virtue of section 3(a) of the Davis-Bacon Act or 29 CFR §

5.12(a)(1).
(iii) The penalty for making false statements is prescribed in the U.S. Criminal Code, 18 USC § 1001.

Reference: 2 CFR Part 200, Appendix II(D); 29 CFR Part 5; 49 USC § 47112(b); 40 USC §§ 3141-3144, 3146, and 3147
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FAA – 11 Debarment and Suspension
APPLICABILITY - This requirement applies to covered transactions, which are defined in 2 CFR part 180 (Subpart B). AIP funded contracts are non-procurement transactions, as defined by 2 CFR § 180.970. Covered transactions include any AIP-funded contract, regardless of tier, that is awarded by a contractor, subcontractor, supplier, consultant, or its agent or representative in any transaction, if the amount of the contract is expected to equal or exceed $25,000. This includes contracts associated with land acquisition projects.

REQUIREMENT -
A11.3.1 Bidder or Offeror Certification
By submitting a bid/proposal under the solicitation for this contract, the Contractor must have certified that neither it nor its principals are presently debarred or suspended by any Federal department or agency from participation in this transaction.

A11.3.2 Lower Tier Contract Certification

CERTIFICATION OF LOWER TIER CONTRACTORS REGARDING DEBARMENT The Contractor, by administering each lower tier subcontract that exceeds $25,000 as a “covered transaction”, must verify each lower tier participant of a “covered transaction” under the project is not presently debarred or otherwise disqualified from participation in this federally assisted project. The Contractor will accomplish this by:

1. Checking the System for Award Management at website: http://www.sam.gov.

2. Collecting a certification statement similar to the Certification of Offerer /Bidder Regarding Debarment, above.

3. Inserting a clause or condition in the covered transaction with the lower tier contract.

If the Federal Aviation Administration later determines that a lower tier participant failed to disclose to a higher tier participant that it was excluded or disqualified at the time it entered the covered transaction, the FAA may pursue any available remedies, including suspension and debarment of the non-compliant participant.

Reference: 2 CFR part 180 (Subpart B), 2 CFR part 200 Appendix II(H), 2 CFR Part 1200, DOT Order 4200.5; Executive Orders 12549 and 12689 Item 1O - Page 45
FAA – 12 Disadvantaged Business Enterprise
APPLICABILITY – all contracts with Airports that have a DBE program on file with the FAA.

Contract Assurance (§ 26.13) –
The Contractor or subcontractor shall not discriminate on the basis of race, color, national origin, or sex in the performance of this contract. The Contractor shall carry out applicable requirements of 49 CFR part 26 in the award and administration of Department of Transportation-assisted contracts. Failure by the Contractor to carry out these requirements is a material breach of this contract, which may result in the termination of this contract or such other remedy as the City deems appropriate, which may include, but is not limited to:
1) Withholding monthly progress payments;
2) Assessing sanctions;
3) Liquidated damages; and/or
4) Disqualifying the Contractor from future bidding as non-responsible.

Prompt Payment (§26.29) – The prime contractor agrees to pay each subcontractor under this prime contract for satisfactory performance of its contract no later than [10 days] days from the receipt of each payment the prime contractor receives from [the City]. The prime contractor agrees further to return retainage payments to each subcontractor within [30 days] days after the subcontractor’s work is satisfactorily completed. Any delay or postponement of payment from the above referenced time frame may occur only for good cause following written approval of the [City]. This clause applies to both DBE and nonDBE subcontractors.

Termination of DBE Subcontracts (49 CFR § 26.53(f)) –
The prime Contractor must not terminate a DBE subcontractor listed in response to the solicitation (or an approved substitute DBE firm) without prior written consent of the City.

This includes, but is not limited to, instances in which the prime contractor seeks to perform work originally designated for a DBE subcontractor with its own forces or those of an affiliate, a non-DBE firm, or with another DBE firm.

The prime Contractor shall utilize the specific DBEs listed to perform the work and supply the materials for which each is listed unless the Contractor obtains written consent of the City. Unless City consent is provided, the prime Contractor shall not be entitled to any payment for work or material unless it is performed or supplied by the listed DBE.

The City may provide such written consent only if the City agrees, for reasons stated in the concurrence document, that the prime Contractor has good cause to terminate the DBE firm. For purposes of this paragraph, good cause includes the circumstances listed in 49 CFR §26.53.

Before transmitting to the City its request to terminate and/or substitute a DBE subcontractor, the prime Contractor must give notice in writing to the DBE subcontractor, Item 1O - Page 46
with a copy to the City, of its intent to request to terminate and/or substitute, and the reason for the request.

The prime contractor must give the DBE five days to respond to the prime contractor's notice and advise the City and the Contractor of the reasons, if any, why it objects to the proposed termination of its subcontract and why the City should not approve the prime Contractor's action. If required in a particular case as a matter of public necessity (e.g., safety), the City may provide a response period shorter than five days.

In addition to post-award terminations, the provisions of this section apply to preaward deletions of or substitutions for DBE firms put forward by offerors in negotiated procurements.

Reference: 49 CFR part 26
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FAA – 13 Distracted Driving
APPLICABILITY - contracts that exceed the micro-purchase threshold of 2 CFR § 200.320 (currently set at $10,000).

REQUIREMENT -

TEXTING WHEN DRIVING
In accordance with Executive Order 13513, “Federal Leadership on Reducing Text Messaging While Driving”, (10/1/2009) and DOT Order 3902.10, “Text Messaging While Driving”, (12/30/2009), the Federal Aviation Administration encourages recipients of Federal grant funds to adopt and enforce safety policies that decrease crashes by distracted drivers, including policies to ban text messaging while driving when performing work related to a grant or subgrant.

In support of this initiative, the City encourages the Contractor to promote policies and initiatives for its employees and other work personnel that decrease crashes by distracted drivers, including policies that ban text messaging while driving motor vehicles while performing work activities associated with the project. The Contractor must include the substance of this clause in all sub-tier contracts exceeding $10,000 that involve driving a motor vehicle in performance of work activities associated with the project.

Reference: Executive Order 13513, DOT Order 3902.10
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FAA – 14 Prohibition on Certain Telecommunications and Video Surveillance Services and Equipment
APPLICABILITY - all AIP funded contracts and lower-tier contracts.

REQUIREMENT -
Contractor and Subcontractor agree to comply with mandatory standards and policies relating to use and procurement of certain telecommunications and video surveillance services or equipment in compliance with the National Defense Authorization Act [Public Law 115-232 § 889(f)(1)].

Reference: 2 CFR § 200, Appendix II(K); 2 CFR § 200.216 Item 1O - Page 49
FAA – 15 Drug Free Workplace Requirements
APPLICABILITY - This provision applies to all AIP funded projects, but not to the contracts between the City and a contractor, subcontractors, suppliers, or subgrantees.

The Drug-Free Workplace Act of 1988 requires some Federal contractors and all Federal grantees to agree that they will provide drug-free workplaces as a condition of receiving a contract or grant from a Federal agency. The Act does not apply to contractors, subcontractors, or subgrantees, although the Federal grantees workplace may be where the contractors, subcontractors, or subgrantees are working.

Reference: 49 CFR part 32, Drug-Free Workplace Act of 1988 (41 U.S.C. 701 et seq., as amended)
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FAA – 16 Equal Employment Opportunity
APPLICABILITY – The purpose of this provision is to provide equal opportunity for all persons, without regard to race, color, religion, sex, or national origin who are employed or seeking employment with contractors performing under a federally-assisted construction contract. There are two provisions ― a construction clause and a specification clause.

The equal opportunity contract clause applies to any contract or subcontract when the amount exceeds $10,000. Once the equal opportunity clause is determined to be applicable, the contract or subcontract must include the clause for the remainder of the year, regardless of the amount or the contract.

Contract Types –
Construction – all construction contracts and subcontracts as required above.

Equipment – all equipment contracts as required above that involves installation of equipment onsite (e.g., electrical vault equipment). This provision does not apply to equipment acquisition projects where the manufacture of the equipment takes place offsite at the vendor plant (e.g., ARFF and SRE vehicles).

Professional Services – all professional service agreements as required above.

Property – all land acquisition projects that include work that qualifies as construction work as defined by 41 CFR part 60 as required above. An example is installation of boundary fencing.

REQUIREMENT -
A16.3.1 EEO Contract Clause
During the performance of this contract, the Contractor agrees as follows:
(1) The Contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, sexual orientation, gender identity, or national origin. The Contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, sexual orientation, gender identify, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff, or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause.
(2) The Contractor will, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, sexual orientation, gender identity, or national origin.

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(3) The contractor will not discharge or in any other manner discriminate against any employee or applicant for employment because such employee or applicant has inquired about, discussed, or disclosed the compensation of the employee or applicant or another employee or applicant. This provision shall not apply to instances in which an employee who has access to the compensation information of other employees or applicants as a part of such employee's essential job functions discloses the compensation of such other employees or applicants to individuals who do not otherwise have access to such information, unless such disclosure is in response to a formal complaint or charge, in furtherance of an investigation, proceeding, hearing, or action, including an investigation conducted by the employer, or is consistent with the contractor's legal duty to furnish information.
(4) The Contractor will send to each labor union or representative of workers with which it has a collective bargaining agreement or other contract or understanding, a notice to be provided by the agency contracting officer, advising the labor union or workers’ representative of the Contractor’s commitments under this section 202 of Executive Order 11246 of September 24, 1965, and shall post copies of the notice in conspicuous places available to employees and applicants for employment. (5) The Contractor will comply with all provisions of Executive Order 11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. (6) The Contractor will furnish all information and reports required by Executive Order 11246 of September 24, 1965, and by the rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to his books, records, and accounts by the contracting agency and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and orders. (7) In the event of the Contractor’s noncompliance with the nondiscrimination clauses of this contract or with any such rules, regulations, or orders, this contract may be canceled, terminated, or suspended in whole or in part and the Contractor may be declared ineligible for further Government contracts in accordance with procedures authorized in Executive Order 11246 of September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in Executive Order 11246 of September 24, 1965, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law.
(8) The Contractor will include the provisions of paragraphs (1) through (8) in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to section 204 of Executive Order 11246 of September 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The Contractor will take such action with respect to any subcontract or purchase order as may be directed by the Secretary of Labor as a means of enforcing such provisions, including sanctions for noncompliance: Provided, however, that in the event the contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction, the Contractor may request the United States to enter into such litigation to protect the interests of the United States.

A16.3.2 EEO Specification
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STANDARD FEDERAL EQUAL EMPLOYMENT OPPORTUNITY

CONSTRUCTION CONTRACT SPECIFICATIONS
a. “Covered area” means the geographical area described in the solicitation from which this contract resulted;
b. “Director” means Director, Office of Federal Contract Compliance Programs (OFCCP), U.S. Department of Labor, or any person to whom the Director delegates authority; c. “Employer identification number” means the Federal social security number used on the Employer’s Quarterly Federal Tax Return, U.S. Treasury Department Form 941; d. “Minority” includes:
(1) Black (all persons having origins in any of the Black African racial groups not of Hispanic origin);
(2) Hispanic (all persons of Mexican, Puerto Rican, Cuban, Central or South American, or other Spanish culture or origin, regardless of race); (3) Asian and Pacific Islander (all persons having origins in any of the original peoples of the Far East, Southeast Asia, the Indian Subcontinent, or the Pacific Islands); and
(4) American Indian or Alaskan native (all persons having origins in any of the original peoples of North America and maintaining identifiable tribal affiliations through membership and participation or community identification).

2. Whenever the Contractor, or any subcontractor at any tier, subcontracts a portion of the work involving any construction trade, it shall physically include in each subcontract in excess of $10,000 the provisions of these specifications and the Notice which contains the applicable goals for minority and female participation and which is set forth in the solicitations from which this contract resulted.

3. If the Contractor is participating (pursuant to 41 CFR part 60-4.5) in a Hometown Plan approved by the U.S. Department of Labor in the covered area either individually or through an association, its affirmative action obligations on all work in the Plan area (including goals and timetables) shall be in accordance with that Plan for those trades which have unions participating in the Plan. Contractors must be able to demonstrate their participation in and compliance with the provisions of any such Hometown Plan.

Each contractor or subcontractor participating in an approved plan is individually required to comply with its obligations under the EEO clause and to make a good faith effort to achieve each goal under the Plan in each trade in which it has employees.

The overall good faith performance by other contractors or subcontractors toward a goal in an approved Plan does not excuse any covered contractor’s or subcontractor’s failure to take good faith efforts to achieve the Plan goals and timetables.

4. The Contractor shall implement the specific affirmative action standards provided in paragraphs 7a through 7p of these specifications. The goals set forth in the solicitation from which this contract resulted are expressed as percentages of the total hours of employment and training of minority and female utilization the Contractor should reasonably be able to achieve in each construction trade in which it has Item 1O - Page 53
employees in the covered area. Covered construction contractors performing construction work in a geographical areas where they do not have a Federal or federally assisted construction contract shall apply the minority and female goals established for the geographical area where the work is being performed. Goals are published periodically in the Federal Register in notice form, and such notices may be obtained from any Office of Federal Contract Compliance Programs office or from Federal procurement contracting officers. The Contractor is expected to make substantially uniform progress in meeting its goals in each craft during the period specified.

5. Neither the provisions of any collective bargaining agreement, nor the failure by a union with whom the Contractor has a collective bargaining agreement, to refer either minorities or women shall excuse the Contractor’s obligations under these specifications, Executive Order 11246, or the regulations promulgated pursuant thereto.

6. In order for the nonworking training hours of apprentices and trainees to be counted in meeting the goals, such apprentices and trainees must be employed by the Contractor during the training period, and the Contractor must have made a commitment to employ the apprentices and trainees at the completion of their training, subject to the availability of employment opportunities. Trainees must be trained pursuant to training programs approved by the U.S. Department of Labor.

7. The Contractor shall take specific affirmative actions to ensure equal employment opportunity. The evaluation of the Contractor’s compliance with these specifications shall be based upon its effort to achieve maximum results from its actions. The Contractor shall document these efforts fully, and shall implement affirmative action steps at least as extensive as the following:
a. Ensure and maintain a working environment free of harassment, intimidation, and coercion at all sites, and in all facilities at which the Contractor’s employees are assigned to work. The Contractor, where possible, will assign two or more women to each construction project. The Contractor shall specifically ensure that all foremen, superintendents, and other onsite supervisory personnel are aware of and carry out the Contractor’s obligation to maintain such a working environment, with specific attention to minority or female individuals working at such sites or in such facilities.
b. Establish and maintain a current list of minority and female recruitment sources, provide written notification to minority and female recruitment sources and to community organizations when the Contractor or its unions have employment opportunities available, and maintain a record of the organizations’ responses. c. Maintain a current file of the names, addresses, and telephone numbers of each minority and female off-the-street applicant and minority or female referral from a union, a recruitment source, or community organization and of what action was taken with respect to each such individual. If such individual was sent to the union hiring hall for referral and was not referred back to the Contractor by the union or, if referred, not employed by the Contractor, this shall be documented Item 1O - Page 54
in the file with the reason therefor, along with whatever additional actions the Contractor may have taken.
d. Provide immediate written notification to the Director when the union or unions with which the Contractor has a collective bargaining agreement has not referred to the Contractor a minority person or woman sent by the Contractor, or when the Contractor has other information that the union referral process has impeded the Contractor’s efforts to meet its obligations.
e. Develop on-the-job training opportunities and/or participate in training programs for the area which expressly include minorities and women, including upgrading programs and apprenticeship and trainee programs relevant to the Contractor’s employment needs, especially those programs funded or approved by the Department of Labor. The Contractor shall provide notice of these programs to the sources compiled under 7b above.
f. Disseminate the Contractor’s EEO policy by providing notice of the policy to unions and training programs and requesting their cooperation in assisting the Contractor in meeting its EEO obligations; by including it in any policy manual and collective bargaining agreement; by publicizing it in the company newspaper, annual report, etc.; by specific review of the policy with all management personnel and with all minority and female employees at least once a year; and by posting the company EEO policy on bulletin boards accessible to all employees at each location where construction work is performed. g. Review, at least annually, the company’s EEO policy and affirmative action obligations under these specifications with all employees having any responsibility for hiring, assignment, layoff, termination, or other employment decisions including specific review of these items with onsite supervisory personnel such superintendents, general foremen, etc., prior to the initiation of construction work at any job site. A written record shall be made and maintained identifying the time and place of these meetings, persons attending, subject matter discussed, and disposition of the subject matter. h. Disseminate the Contractor’s EEO policy externally by including it in any advertising in the news media, specifically including minority and female news media, and providing written notification to and discussing the Contractor’s EEO policy with other contractors and subcontractors with whom the Contractor does or anticipates doing business.
i. Direct its recruitment efforts, both oral and written, to minority, female, and community organizations, to schools with minority and female students and to minority and female recruitment and training organizations serving the Contractor’s recruitment area and employment needs. Not later than one month prior to the date for the acceptance of applications for apprenticeship or other training by any recruitment source, the Contractor shall send written notification to organizations such as the above, describing the openings, screening procedures, and tests to be used in the selection process.

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j. Encourage present minority and female employees to recruit other minority persons and women and, where reasonable, provide after school, summer, and vacation employment to minority and female youth both on the site and in other areas of a contractor’s work force.
k. Validate all tests and other selection requirements where there is an obligation to do so under 41 CFR part 60-3.
l. Conduct, at least annually, an inventory and evaluation at least of all minority and female personnel, for promotional opportunities and encourage these employees to seek or to prepare for, through appropriate training, etc., such opportunities.
m. Ensure that seniority practices, job classifications, work assignments, and other personnel practices do not have a discriminatory effect by continually monitoring all personnel and employment related activities to ensure that the EEO policy and the Contractor’s obligations under these specifications are being carried out. n. Ensure that all facilities and company activities are nonsegregated except that separate or single-user toilet and necessary changing facilities shall be provided to assure privacy between the sexes.
o. Document and maintain a record of all solicitations of offers for subcontracts from minority and female construction contractors and suppliers, including circulation of solicitations to minority and female contractor associations and other business associations.
p. Conduct a review, at least annually, of all supervisor’s adherence to and performance under the Contractor’s EEO policies and affirmative action obligations.

8. Contractors are encouraged to participate in voluntary associations, which assist in fulfilling one or more of their affirmative action obligations (7a through 7p). The efforts of a contractor association, joint contractor-union, contractor-community, or other similar group of which the Contractor is a member and participant may be asserted as fulfilling any one or more of its obligations under 7a through 7p of these specifications provided that the Contractor actively participates in the group, makes every effort to assure that the group has a positive impact on the employment of minorities and women in the industry, ensures that the concrete benefits of the program are reflected in the Contractor’s minority and female workforce participation, makes a good faith effort to meet its individual goals and timetables, and can provide access to documentation which demonstrates the effectiveness of actions taken on behalf of the Contractor. The obligation to comply, however, is the Contractor’s and failure of such a group to fulfill an obligation shall not be a defense for the Contractor’s noncompliance.

9. A single goal for minorities and a separate single goal for women have been established. The Contractor, however, is required to provide equal employment opportunity and to take affirmative action for all minority groups, both male and female, and all women, both minority and non-minority. Consequently, the Contractor Item 1O - Page 56
may be in violation of the Executive Order if a particular group is employed in a substantially disparate manner (for example, even though the Contractor has achieved its goals for women generally, the Contractor may be in violation of the Executive Order if a specific minority group of women is underutilized).

10. The Contractor shall not use the goals and timetables or affirmative action standards to discriminate against any person because of race, color, religion, sex, sexual orientation, gender identity, or national origin.

11. The Contractor shall not enter into any subcontract with any person or firm debarred from Government contracts pursuant to Executive Order 11246.

12. The Contractor shall carry out such sanctions and penalties for violation of these specifications and of the Equal Opportunity Clause, including suspension, termination, and cancellation of existing subcontracts as may be imposed or ordered pursuant to Executive Order 11246, as amended, and its implementing regulations, by the Office of Federal Contract Compliance Programs. Any contractor who fails to carry out such sanctions and penalties shall be in violation of these specifications and Executive Order 11246, as amended.

13. The Contractor, in fulfilling its obligations under these specifications, shall implement specific affirmative action steps, at least as extensive as those standards prescribed in paragraph 7 of these specifications, so as to achieve maximum results from its efforts to ensure equal employment opportunity. If the Contractor fails to comply with the requirements of the Executive Order, the implementing regulations, or these specifications, the Director shall proceed in accordance with 41 CFR part 60-4.8.

14. The Contractor shall designate a responsible official to monitor all employment related activity to ensure that the company EEO policy is being carried out, to submit reports relating to the provisions hereof as may be required by the Government, and to keep records. Records shall at least include for each employee, the name, address, telephone numbers, construction trade, union affiliation if any, employee identification number when assigned, social security number, race, sex, status (e.g., mechanic, apprentice, trainee, helper, or laborer), dates of changes in status, hours worked per week in the indicated trade, rate of pay, and locations at which the work was performed. Records shall be maintained in an easily understandable and retrievable form; however, to the degree that existing records satisfy this requirement, contractors shall not be required to maintain separate records.

15. Nothing herein provided shall be construed as a limitation upon the application of other laws which establish different standards of compliance or upon the application of requirements for the hiring of local or other area residents (e.g. those under the Public Works Employment Act of 1977 and the Community Development Block Grant Program).

Reference: 2 CFR 200, Appendix II(C), 41 CFR § 60-1.4, 41 CFR § 60-4.3, Executive Order 11246
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FAA – 17 Federal Fair Labor Standards Act
APPLICABILITY – Contract Types – Per the Department of Labor, all employees of certain enterprises having workers engaged in interstate commerce; producing goods for interstate commerce; or handling, selling, or otherwise working on goods or materials that have been moved in or produced for such commerce by any person are covered by the FLSA.

All consultants, sub-consultants, contractors, and subcontractors employed under this federally assisted project must comply with the FLSA.

Professional Services – 29 CFR § 213 exempts employees in a bona fide executive, administrative or professional capacity. Because professional firms employ individuals that are not covered by this exemption, the agreement with a professional services firm must include the FLSA provision.

REQUIREMENT -
The provisions of 29 CFR part 201, the Federal Fair Labor Standards Act (FLSA), are incorporated by reference with the same force and effect as if given in full text. The FLSA sets minimum wage, overtime pay, recordkeeping, and child labor standards for full and part-time workers.

The Contractor has full responsibility to monitor compliance to the referenced statute or regulation. The Contractor must address any claims or disputes that arise from this requirement directly with the U.S. Department of Labor – Wage and Hour Division.

Reference: 29 USC § 201, et seq; 2 CFR § 200.430
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FAA – 18 Lobbying and Influencing Federal Employees
APPLICABILITY- all contracts exceeding $100,000.

REQUIREMENT -
Consultants and contractors that apply or bid for an award of $100,000 or more must have certified that it will not and has not used Federal appropriated funds to pay any person or organization for influencing or attempting to influence an officer or employee of any agency, a member of Congress, officer or employee of Congress, or an employee of a member of Congress in connection with obtaining any Federal contract, grant, or another award covered by 31 USC §1352. Each tier must also disclose any lobbying with nonFederal funds that takes place in connection with obtaining any Federal award.

For an award over $100,00, the bidder or offeror certifies by signing and submitting this bid or proposal, to the best of his or her knowledge and belief, that:
• No Federal appropriated funds have been paid or will be paid, by or on behalf of the bidder or offeror, to any person for influencing or attempting to influence an officer or employee of an agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement.
• If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, the undersigned shall complete and submit Standard FormLLL, “Disclosure Form to Report Lobbying,” in accordance with its instructions. • The undersigned shall require that the language of this certification be included in the award documents for all sub-awards at all tiers (including subcontracts, sub-grants, and contracts under grants, loans, and cooperative agreements) and that all subrecipients shall certify and disclose accordingly.

This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction imposed by section 1352, title 31, U.S. Code.

Any person who fails to file the required certification shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure.

Reference: 31 USC § 1352 – Byrd Anti-Lobbying Amendment, 2 CFR part 200, Appendix II(I), 49 CFR part 20, Appendix A
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FAA – 19 Prohibition of Segregated Facilities
APPLICABILITY - The Contractor must comply with the requirements of the EEO clause by ensuring that facilities they provide for employees are free of segregation on the basis of race, color, religion, sex, sexual orientation, gender identity, or national origin. This clause must be included in all contracts that include the equal opportunity clause, regardless of the amount of the contract.

Contract Types – any contract containing the Equal Employment Opportunity clause of 41 CFR § 60-1.4. This obligation flows down to subcontract and sub-tier purchase orders containing the Equal Employment Opportunity clause.

Construction – Construction work means construction, rehabilitation, alteration, conversion, extension, demolition or repair of buildings, highways, or other changes or improvements to real property, including facilities providing utility services. The term also includes the supervision, inspection, and other onsite functions incidental to the actual construction.

Equipment – On site installation of equipment such as airfield lighting control equipment meets the definition of construction and thus this provision would apply. This provision does not apply to equipment projects involving manufacture of the item at a vendor’s manufacturing plant. An example would be the manufacture of a SRE or ARFF vehicle.

Professional Services – Professional services that include tasks that qualify as construction work as defined by 41 CFR part 60-1. Examples include the installation of noise monitoring equipment.

Property/Land – Land acquisition contracts that include tasks that qualify as construction work as defined by 41 CFR part 60-1. Examples include demolition of structures or installation of boundary fencing.

REQUIREMENT -
(a) The Contractor agrees that it does not and will not maintain or provide for its employees any segregated facilities at any of its establishments, and that it does not and will not permit its employees to perform their services at any location under its control where segregated facilities are maintained. The Contractor agrees that a breach of this clause is a violation of the Equal Employment Opportunity clause in this contract.
(b) “Segregated facilities,” as used in this clause, means any waiting rooms, work areas, rest rooms and wash rooms, restaurants and other eating areas, time clocks, locker rooms and other storage or dressing areas, parking lots, drinking fountains, recreation or entertainment areas, transportation, and housing facilities provided for employees that are segregated by explicit directive or are in fact segregated on the basis of race, color, religion, sex, sexual orientation, gender identity, or national origin because of written or oral policies or employee custom. The term does not include separate or single-user rest rooms or necessary dressing or sleeping areas provided to assure privacy between the sexes.

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(c) The Contractor shall include this clause in every subcontract and purchase order that is subject to the Equal Employment Opportunity clause of this contract.

Reference: 2 CFR Part 200, Appendix II (C); 41 CFR Part 60-1 Item 1O - Page 61
FAA – 20 Occupational Safety and Health Act
APPLICABILITY – Contract Types – All contracts and subcontracts must comply with the Occupational Safety and Health Act of 1970 (OSH). The U.S. Department of Labor Occupational Safety and Health Administration (OSHA) oversees the workplace health and safety standards wage provisions from OSH.

REQUIREMENT -
All contracts and subcontracts that result from this solicitation incorporate by reference the requirements of 29 CFR Part 1910 with the same force and effect as if given in full text.

The employer must provide a work environment that is free from recognized hazards that may cause death or serious physical harm to the employee. The employer retains full responsibility to monitor its compliance and their subcontractor’s compliance with the applicable requirements of the Occupational Safety and Health Act of 1970 (29 CFR Part 1910). The employer must address any claims or disputes that pertain to a referenced requirement directly with the U.S. Department of Labor – Occupational Safety and Health Administration.

Reference: 29 CFR part 1910
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FAA – 21 Procurement of Recovered Materials
APPLICABILITY – Contract Types – This provision applies to any contracts that include procurement of products designated in subpart B of 40 CFR part 247 where the purchase price of the item exceeds $10,000 or the value of the quantity acquired by the preceding fiscal year exceeded $10,000.

Construction and Equipment – all construction and equipment projects.

Professional Services and Property – if the agreement includes procurement of a product that exceeds $10,000.

REQUIREMENT -
Contractor and subcontractor agree to comply with Section 6002 of the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act, and the regulatory provisions of 40 CFR Part 247. In the performance of this contract and to the extent practicable, the Contractor and subcontractors are to use products containing the highest percentage of recovered materials for items designated by the Environmental Protection Agency (EPA) under 40 CFR Part 247 whenever:
1) The contract requires procurement of $10,000 or more of a designated item during the fiscal year; or
2) The contractor has procured $10,000 or more of a designated item using Federal funding during the previous fiscal year.

The list of EPA-designated items is available at www.epa.gov/smm/comprehensiveprocurement-guidelines-construction-products.

Section 6002(c) establishes exceptions to the preference for recovery of EPA-designated products if the contractor can demonstrate the item is:
a) Not reasonably available within a timeframe providing for compliance with the contract performance schedule;
b) Fails to meet reasonable contract performance requirements; or c) Is only available at an unreasonable price.

Reference: 2 CFR § 200.323, 2 CFR Part 200, Appendix II (J); 40 CFR part 247, 42 USC § 6901, et seq (Resource Conservation and Recovery Act) Item 1O - Page 63
FAA – 22 Rights to Inventions
APPLICABILITY – Contract Types – This provision applies to all contracts and subcontracts with small business firms or nonprofit organizations that include performance of experimental, developmental, or research work. This clause is not applicable to construction, equipment, or professional service contracts unless the contract includes experimental, developmental, or research work.

REQUIREMENT -
Contracts or agreements that include the performance of experimental, developmental, or research work must provide for the rights of the Federal Government and the City in any resulting invention as established by 37 CFR part 401, Rights to Inventions Made by Nonprofit Organizations and Small Business Firms under Government Grants, Contracts, and Cooperative Agreements. This contract incorporates by reference the patent and inventions rights as specified within 37 CFR §401.14. Contractor must include this requirement in all sub-tier contracts involving experimental, developmental, or research work.

Reference: 2 CFR § 200, Appendix II(F), 37 CFR 401
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FAA - 23 Seismic Safety
APPLICABILITY – Contract Types – This provision applies to construction of new buildings and additions to existing buildings financed in whole or in part through the Airport Improvement Program.

Professional Services– any contract involved in the construction of new buildings or structural addition to existing buildings.

Construction – any contract involved in the construction of new buildings or structural addition to existing buildings.

Equipment – if the project involves construction or structural addition to a building such as an electrical vault project to accommodate or install equipment.

Land – This provision will not typically apply to a property/land project.

REQUIREMENT -
A23.3.1 Professional Service Agreements for Design

SEISMIC SAFETY
In the performance of design services, the Consultant agrees to furnish a building design and associated construction specification that conform to a building code standard that provides a level of seismic safety substantially equivalent to standards as established by the National Earthquake Hazards Reduction Program (NEHRP). Local building codes that model their building code after the current version of the International Building Code (IBC) meet the NEHRP equivalency level for seismic safety. At the conclusion of the design services, the Consultant agrees to furnish the Owner a “certification of compliance” that attests conformance of the building design and the construction specifications with the seismic standards of NEHRP or an equivalent building code.

A23.3.2 Construction Contracts

SEISMIC SAFETY
The Contractor agrees to ensure that all work performed under this contract, including work performed by subcontractors, conforms to a building code standard that provides a level of seismic safety substantially equivalent to standards established by the National Earthquake Hazards Reduction Program (NEHRP). Local building codes that model their code after the current version of the International Building Code (IBC) meet the NEHRP equivalency level for seismic safety.

Reference: 49 CFR Part 41
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FAA – 24 Tax Delinquency and Felony Conviction
APPLICABILITY – This provision applies to all contracts funded in whole or part with AIP.

REQUIREMENT -
The Contractor must have certified under the procurement process that resulted in the award of this contract that:
• Contractor has not been convicted of a Federal felony within the last 24 months; or • Contractor does not have any outstanding tax liability for which all judicial and administrative remedies have lapsed or been exhausted.

Reference: Sections 8113 of the Consolidated Appropriations Act, 2022 (Public Law 117-103), and similar provisions in subsequent appropriations acts.

DOT Order 4200.6 – Appropriations Act Requirements for Procurement and NonProcurement Regarding Tax Delinquency and Felony Convictions Item 1O - Page 66
FAA – 25 Termination of Contract
APPLICABILITY – All contracts and subcontracts in excess of $10,000.

REQUIREMENT -
See Section 4.5 of the Agreement.

Reference: 2 CFR § 200 Appendix II(B), FAA Advisory Circular 150/5370-10, Section 80-09
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FAA – 26 Foreign Trade Restriction
APPLICABILITY – all AIP funded projects.

REQUIREMENT -

TRADE RESTRICTION CERTIFICATION
By accepting this contract the Contractor certifies the following statements are true – 1) is not owned or controlled by one or more citizens of a foreign country included in the list of countries that discriminate against U.S. firms as published by the Office of the United States Trade Representative (USTR);
2) has not knowingly entered into any contract or subcontract for this project with a person that is a citizen or national of a foreign country included on the list of countries that discriminate against U.S. firms as published by the USTR; and 3) has not entered into any subcontract for any product to be used on the Federal project that is produced in a foreign country included on the list of countries that discriminate against U.S. firms published by the USTR.