Victorville City Council
February 20, 2024

SECTION 2. FRINGE BENEFITS - The following is provided as an overview and should not be considered as a complete description of benefits. The fringe benefits for the City of Victorville full -time employees effective July 1, 2023, unless otherwise specified, through June 30, 2024, shall be:

Annual Vacation Leave - All full-time employees shall earn annual vacation credits accrued bi-weekly in the beginning of the years listed below and are authorized to accumulate vacation leave credits as follows:

Years of Full-Time
Employment
Annual Vacation Hours
Earned
Hours Earned Per Pay
Period (26 pay periods
per year)
Maximum Vacation
Accrual Hours
0-5 80 3.08 160
6-10 120 4.62 240
11-15 160 6.15 320
16+ 200 7.69 400

Full-time employees are eligible to use annual leave time as it accrues. Effective January 1, 2012, accruals will be earned every pay period. (See City of Victorville Personnel Rules, Rule X, Sections 1 and 2.) Sick Leave – Accrued at the rate of 3.7 hours per pay period for all probationary and full -time employees, for a total of 96 hours per year.

Healthy Workplaces/Healthy Families Act of 2014 Paid Sick Leave – A part-time employee who, on or after July 1, 2015, works in California for 30 or more days within a year from the beginning of employment is entitled to paid sick leave. Paid sick leave accrues at the rate of one hour per every 30 hours worked, paid at the employees’ regular wage rate. Accrual shall begin on the first day of employment. Accruals may be capped at 48 hours or 6 days.

Sick Leave Yearly Payoff - Non-represented full-time employees who maintain a minimum of 144 hours and have completed 5 years of full-time of continuous service with the City of Victorville will be able to receive a payoff of their accrued sick leave hours. The maximum payoff cannot exceed 144 hours, every December, beginning December 2021.

Non-represented part-time employees who maintain a minimum of 72 hours and have completed 5 years of part-time continuous service with the City of Victorville will be able to receive a payoff of their accrued sick leave hours. The maximum payoff cannot exceed 72 hours, every December, beginning December 2021.

The sick leave payoff will be based on the following scale:

Sick Leave Accrued as of
Date of Termination
Cash Payment of hours
of Accrued Sick Leave
240 hours or less 35%
241 to 320 hours 40%
321 to 400 hours 45%
401 to 480 hours 50%
481 to 560 hours 55%
561 to 640 hours 60%
641 to 720 hours 65%
721 to 800 hours 70%
801 to 880 hours 75%
881 to 960 hours 80%
961 to 1,040 hours 85%
1,041 to 1,120 hours 90%
1,121 to 1,200 hours 95%
1,201 hours and above 100%

Upon completion of five (5) years of continuous service, sick leave payout upon separation of service or termination is calculated according to the above formula, pursuant to Resolution 09-103.

Holidays

Day Date Holiday
Monday July 3, 2023 Independence Day Eve
Tuesday July 4, 2023 Independence Day
Monday September 4, 2023 Labor Day
Friday November 10, 2023 Veterans Day
Thursday November 23, 2023 Thanksgiving Day
Friday November 24, 2023 Day after Thanksgiving
Monday December 25, 2023 Christmas Holiday
Friday December 29, 2023 Christmas Eve Holiday (Observed) Monday January 1, 2024 New Year's Day Holiday
Monday January 15, 2024 Martin Luther King, Jr. Day
Monday February 19, 2024 President's Day
Monday May 27, 2024 Memorial Day Holiday
Wednesday June 19, 2024 Juneteenth
1 Floating Holiday
Total of 14 Holidays

Note: Actual holidays vary each year. Three days in December are designated as permanent Cost of Living Adjustment (COLA) reduction days and applied to the December holiday schedule. Actual COLA reduction days taken are based on individual department needs and must be taken within 30 days. Days off during the December holidays shall not be prorated for any employee hired after January 1, 2023.

Floating Holiday may be taken in conjunction with another holiday, vacation, or sick leave day. No partial holiday may be taken. Floating Holiday may be taken after six months of service.

Premium Holiday Pay- Based on the approved holidays in this section and excluding the floating holiday, nonexempt, full-time, non-represented employees who are eligible for paid holidays but who are required to work on a company holiday will be paid at one and one- half times their regular rate of pay for the hours worked in addition to holiday pay. Part -time employees who are required to work on an approved company holiday will be eligible to receive one and one-half times their regular rate of pay for the hours worked.

Stability Pay – Non-represented employees will receive stability pay, starting after 10 years of part -time or full-time service or the combination of the two with the City of Victorville, during the last pay period of the fiscal year, beginning on July 2023, based on the following scale:

Years of Service Amount
10 - 14 $500
15 - 19 $1,000
20 + $1,500

Executive Leave – Provided to Department Heads, Assistant Department Heads, and other designated staff, based on the City Manager’s evaluation of the amount of time worked. Advance written approval by the City Manager is required. (See Administrative Policy D-1.)

Compensatory Time – Employees eligible for compensatory time may accrue such time, up to the limit of 80 hours for full-time employees. Compensatory time may not be earned until 40 hours have been worked in a workweek. Compensatory time earned after 40 hours in a workweek are earned at one and one-half rates.

It is the employee’s choice whether to receive compensatory time or overtime pay. Part-time employees and Safety Shift Personnel are not eligible for compensatory time.

Retirement – Effective July 1, 2015, the City ceased to pay the 8.0% employee share of contributions to the California Public Employees’ Retirement System (CalPERS). The City ceased to report the Employer Paid Member Contributions (EPMC) to PERS as special compensation. The City shall participate in the CalPERS replacement benefit plan or equivalent. The City provides all full -time employees 4th level 1959 Survivor’s Benefits.

For full-time employees and Council Members hired on or after January 1, 2013, CalPERS contributions will be implemented according to the Public Employees’ Pension Reform Act of 2013 (PEPRA) AB 340 and AB 197. Council Members have the option to elect membership to CalPERS.

Miscellaneous Classic Formula: Member formula: 2.5% @ 55 Employees pay CalPERS 8% employee contribution.

Miscellaneous PEPRA Formula: Member formula 2.0% @ 62 Employee will pay the statutorily mandated employee contribution rate of one half of the total normal cost.

Safety Classic Formula: Member formula: 2% @ 50 Employee pay CalPERS 9% employee contribution.

Safety PEPRA Formula: Member formula 2.7% @ 57. Employee will pay the statutorily mandated employee

contribution rate of one half of the total normal cost.

Deferred Compensation – As of January 1, 2024, full-time employees shall be eligible to transfer up to $23,000 of annual salary per year into a City-approved Deferred Compensation Plan; full-time employees 50 years of age and above are allowed a catch- up provision of $7,500. An additional standard provision is available to full-time employees who are planning on retiring within three years. Under this provision funds not utilized may be contributed the year prior to retirement. Deferred Compensation funds may be accessed through a loan program.

A 401(a) Defined Contribution Plan is available for new full -time employees who may elect an employee contribution, under Section 401(a) of the Internal Revenue Code. The plan document allows a 60-day period for the individuals to make an election from the initial date of hire. Pursuant to Federal Regulations, effective December 31, 2009, existing full-time employees may not enroll or modify an existing 401(a) plan.

Employer contributions will not be offered in any new recruitments effective July 1, 2022. Employees receiving employer contributions toward deferred compensation prior to July 1, 2022, will be grandfathered into the pre-existing deferred compensation structure, and will continue to receive the employer contribution offered for the following non- represented classifications (should the grandfathered employee maintain continuous employment with the City and receive a promotion to a higher position): Fire Chief $800, Division Chief $750, Battalion Chief $750, Fire Marshal $750.

Retirement Medical Coverage – City employees and Council Members who meet CalPERS’s requirements and retire simultaneously with the City of Victorville are considered City retirees.

The City shall be responsible for retirees’ (beginning with eight years of service) medical insurance premium as follows:

Years of Service 25 + 20-24 15-19 8-14
City Paid 100% 75% 50% 25%

Retirees must have been previously enrolled in medical coverage, for twelve consecutive months, in the City’s medical insurance plan at time of retirement to be eligible to receive the medical reimbursement based on the above table.

For early retirees under age 65 - Payment is based on the single-party rate of the medical options available through the City’s insurance plan, not to exceed $900 per month.

For retirees age 65 and over – Payment is based on available Medicare Supplemental options single-party rate, available through the City’s insurance plan, not to exceed $900 per month.

City Retirees from non-represented groups may postpone their medical insurance enrollment to a later date.

Out-of-state City Retirees Medical Reimbursement – City Retirees from non -represented groups residing outside the state of California will be eligible to enroll in medical insurance plans outside of CalPERS and remain eligible to receive medical reimbursement based on the years of service according to the table above.

Proof of payment will be required.

Retirees age 65 and over must be enrolled with Medicare Part A (Hospital) and Part B (Medical) in order to

be eligible for a retiree medical plan offered through the City.

Retirees may continue dental and vision insurance coverage at their own expense.

Retirees must have been previously enrolled in medical coverage, for twelve consecutive months, in the City’s medical insurance plan at time of retirement to be eligible to receive the one time pay-off option.

Effective February 11, 2000, an employee may opt for a one-time pay-off, at the time of retirement, in lieu of monthly medical retirement benefits. This shall be paid on a pro-rated basis, contingent upon years of service described in the chart below.

Years of Service 25 + 20-24 15-19 8-14
City Paid 100% 75% 50% 25%
Pay-off Amount $18,800 $15,039 $11,278 $7,522

These amounts may change annually, based on the CPI applied to the City employees’ wages.

Medicare - Employees hired after April 1, 1986, shall contribute 1.45% of their base salary as a matching share of contribution to provide Medicare coverage, available upon retirement, based on Social Security Administration guidelines.

Fringe – The amount of $900 per month is provided by the City for health, dental, and vision coverage for all full-time employees and Council Members. Married couples who are both full -time employees with the City may utilize the full fringe each for family medical, dental and vision. If eligible family members are enrolled, they must be enrolled in the same coverage as elected by the employee. The maximum cash back benefit for employees and Council Members waiving medical benefits is $400 per month. Any Council Member who is a CalPERS Retiree and not allowed to enroll in the City’s active plan may apply up to a maximum of $900 towards a CalPERS retiree medical premium. Employees and Council Members may purchase dental and vision coverage with this amount. Any remaining balance may be deposited into a flexible spending account or included as taxable income on their paychecks. Flexible spending accounts are provided for pre-tax deposits to cover expenses for health care and/or dependent day care. The City is responsible for the monthly administrative fee associated with the health care and dependent day care plans.

Additionally, full-time employees who enroll in medical, dental and vision plans and are paying out-of-pocket, the City will subsidize 50% of the total out-of-pocket cost up to $700 per month. This subsidy does not apply to Council Members or retirees.

Workers' Compensation Program – Insurance provided by the City for work -related injuries occurring to the employee during the course of employment. (See City of Victorville Personnel Rules, Rule X, Section 4.) (See Family and Medical Leave Act Policy No. B-25)

Employee Assistance Program – The City provides for a confidential counseling program for employees and eligible dependents.

Unemployment Insurance – May provide income for the employee if laid off or involuntarily terminated for reasons other than misconduct.

Life insurance - Group term life insurance and accidental death and dismemberment insurance is paid by

the City at the rate of .162 per thousand dollars of base salary and is rounded to the nearest $1,000. For Full- time employees, the benefit is one times annual salary, to a maximum of $250,000. A maximum of $10,000 life insurance policy is paid by the City for Council Members.

Short-Term Disability (STD) Insurance – Full-time employees shall contribute .61% per $100 of monthly salary. Employee premiums are post -tax; therefore, benefits will not be taxed upon receipt of payment.

Employees may be eligible to receive disability payments after 7 days of missed work, and benefits shall continue for 13 weeks for a qualifying illness or injury . STD pays 60% of employees’ weekly base pay, with a minimum of $50 per week, up to a maximum of $1,600 per week. Part-time employees are not elig ible. (See City of Victorville Personnel Rules, Rule X, Section 12.) (See Family and Medical Leave Act Policy No.

B-25).

Long-Term Disability – The City provides coverage for full-time employees after 90 days of disability. The City’s premium is $.70 per $100 of monthly salary and covers 66.67% of employees’ monthly salary. Minimum of $50 per month to a maximum of $5,000 per month.

Paid Parental Leave - Non-represented full-time and part-time employees are eligible for up to four (4) weeks of paid maternity/paternity/adoption leave. Paid Parental Leave (PPL) is compensated at 60% of the employee’s weekly earnings and must be coordinated with sick and/or annual leave accruals, accordingly.

Paid Parental Leave may not be used in conjunction with short-term disability benefits.

Paid Parental Leave is associated with the birth of an employee’s own child or the placement of a child with the employee in connection with adoption. The purpose of paid parental leave is to enable the employee to care for and bond with a newborn or a newly adopted child. Paid Parental Leave may be taken within the first year of the employee’s child's arrival by birth or adoption. This leave is not subject for an extension or a payout.

If both parents are employees, both may access the paid benefits of this policy. This policy will run concurrently with Family and Medical Leave Act (FMLA) leave, as applicable. In order to be eligible to take Paid Parental Leave, a full-time employee must have been employed with the City for at least 12 months and have passed probation. A part-time employee must have 12 months of continuous service. Additionally, the employee must have worked at least 1,250 hours during the 12 consecutive months immediately preceding the date the leave would begin, (Temporary employees, interns, planning commissioners, and council members are not eligible for this benefit).

Safety shoes - All employees, with the exception of Safety Personnel, who are required to wear safety shoes, shall receive $225 reimbursement per fiscal year. Employees may purchase multiple pairs of shoes so long the allowance is not exceeded. Exceptions are governed by Administrative Policy No. G-7.

Uniforms - Payment for non-safety uniform service shall not exceed $174 per year per employee for those employees required to wear uniforms. Reimbursement to Victorville Municipal Utilities Service employees who maintain their own uniforms, due to specialized uniforms and handling, shall not exceed $300 per year.

The following non-represented Victorville Fire Department Positions will receive uniform allowance as follows:

Fire Chief, Deputy Chief of Operations, Division Chief, Battalion Chief, Battalion Chief / Deputy Fire Marshal, EMS Manager $75.00 per month. Emergency Management Coordinator, EMS Specialist, EMS Administrative Technician, Fire Inspector $37.50 per month.

Per CalPERS PEPRA legislation passed January 1, 2013, Uniform allowance is not pensionable for PEPRA CalPERS members.

Stand-by Pay – Available to qualified full -time non- safety and non- exempt regular employees who are required to be immediately available for duty. Employees called to work while on Stand- by will be paid at a rate of $300 per week plus their regular rate of pay for the hours actually worked, subject to FLSA overtime provisions.

Bilingual Pay – Upon the recommendation of the Department Head and based on the need of the Department, full-time and part -time employees who are proficient in speaking a qualified foreign language shall receive $50.00 per month of additional pay as a bilingual pay incentive. To be eligible, personnel must pass the City’s written and oral exam. Currently the qualified foreign language is Spanish.

Tuition Reimbursement – Available to full-time regular employees, after one year of full -time service. All courses taken for reimbursement must be approved by the City Manager/Deputy City Manager and the Personnel Officer prior to the beginning of the course. Courses eligible for reimbursement must be job related and toward a related degree. Tuition reimbursement will include any associated fees including books, permits and other required fees (excluding shipping costs) up to a maximum of $3,000 per fiscal year based on prior approval by the Department Head and Personnel Officer. The Tuition Reimbursement program may be suspended if allocated funds are exhausted and/or if the Council chooses not to allocate the funds necessary to continue the program in any particular fiscal year due to budget constraints. (See Tuition Reimbursement Administrative Policy No: B-31)

Work Week – Full-time non- safety employees will work a 40- hour week schedule. All Safety non- shift employees will work a 40-hour week schedule.

Work schedules:

The work schedule effective July 13th, 2019, will be a 9/80 schedule, whereby all full -time employees will work 40 hours per week. Exceptions to the 9/80 schedule may be approved by the City Manager if it is determined that it is in the best interest of the City. The work week begins each Friday at 12:01pm and ends each Friday at 12:00pm, with the exception of certain Library Staff, Airport Field Operations Workers, VMUS Field Operations Workers, Community Services Park Maintenance Workers, Code Enforcement Officers, Engineering Traffic Field Workers and Animal Control Officers, who will have a work week beginning each Saturday at 12:00am and ending each Friday at 11:59pm.

Overtime will be calculated for all non- exempt employees, who exceed 40 total actual hours worked over a consecutive 168 hours or 7 days (per FLSA) between these times, excluding Safety Shift Personnel.

For all non-exempt, employees, including Safety Shift Personnel, only hours actually worked will be counted when calculating overtime pay. Approved paid leave shall not be considered as time worked for the purpose of computing the total number of hours worked in the work period. Overtime is calculated pursuant to federal law.

Per Resolution No. 22-096, any overtime pay provided to the Battalion Chiefs is a benefit provided pursuant

to this resolution and is not required under the FLSA; and thus, the City will compensate Battalion Chiefs' overtime at a rate which will be one and one-half times the Battalion Chief's base hourly rate.

Regular hours worked each pay period will continue to be paid at a standard 112 hours and not based on the actual shift hours worked.

Extra hours actually worked in a pay period will be computed as overtime based on the standard 112 hours that are paid in each pay period for the Battalion Chief classification. An example is provided in Exhibit A to Resolution No. 22-096 for further illustration.

All overtime work is subject to pre-approval by the Fire Chief; and the Fire Chief may authorize overtime for shift work or emergency incidents beyond the Battalion Chiefs' regularly scheduled assignments.

Time spent in meetings and trainings outside the Battalion Chiefs' regularly scheduled assignments, as pre- approved by the Fire Chief, will be compensated at the overtime rate.

The Battalion Chiefs will no longer qualify for Executive Leave under Rule IV, Section 5 of the City's Personnel Rules and Regulations.

The Battalion Chief/Deputy Fire Marshal and the Battalion Chief assigned to the Training Division will continue to be eligible for Executive Leave under Rule IV, Section 5 of the City's Personnel Rules and Regulations for extra hours worked beyond their 9/ 80 work schedule and directly related to their primary assignments. However, if either position works beyond their primary assignment to cover as Battalion Chief over a suppression shift, or assist on incidents, the City will compensate such hours as overt ime at a rate which will be one and one-half times the Battalion Chief’s base hourly rate based on a 56-hour workweek.

City of Victorville Fire Department Additional Compensation – Included in Memorandum of Understanding in effect May 17, 2022, through May 16, 2027.

Title Salary Rang e Current Hourly Rate Hourly Rate Effective 2-20-2 4 Aquatic Aide M $17.00 $17.00
Recreation Leader I M $17.00 $17.00
Lifeguard 1 $18.41 $18.41
Senior Recreation Leader 1 $18.41 $18.41
Senior Lifeguard 2 $19.83 $19.83
Administrative Intern 2 $19.83 $19.83
Library Aide 2 $19.83 $19.83
Recreation Specialist 3 $21.53 $21.53
Pool Manager 3 $21.53 $21.53
Library Clerk 4 $23.79 $23.79
Office Aide 4 $23.79 $23.79
Maintenance Aide 5 $24.93 $24.93
Vehicle Service Worker - PT 5 $24.93 $24.93
Library Technician 6 $26.34 $26.34
Engineering Intern 6 $26.34 $26.34
Recreation Supervisor - PT 10 $45.38 $45.38
Assistant Engineer - PT 20 $79.31 $79.31

CITY OF VICTORVILLE
MID-YEAR 2023-2024 PART-TIME TABLE OF COMPENSATION

Item Number: 16
City Council / Board of Directors
Written Communications
Meeting of: February 20, 2024
Submitted By:

C. Eric Ray, Airport Director
Subject:

First Lease Amendment to the Standard Lease Agreement for Buildings 553 and 739 by and between the Southern California Logistics Airport Authority and ComAv Technical Services, LLC.

Recommendation:

That the Southern California Logistics Airport Authority (“SCLAA”) Board of Directors:
(1) approve the First Amendment to the Standard Lease Agreement for Buildings 553 and 739 (“Amendment”), by and between the SCLAA and ComAv Technical Services, LLC, (“ComAv”); and
(2) authorize the Airport Director to execute said Agreement.

Fiscal Impact:

The First Amendment presented herein will result in a reduction in gross lease revenue of $350,837.34 over the remaining 31 months of the term (June 1, 2024 – December 31, 2026), which includes a reduction of $10,405.90 in June 2024. The table below outlines the proposed fiscal impact of the proposed First Amendment.

FY 2023-2024
(June)
FY 2024-2025 FY 2025-2026 FY 2026-2027
(July – December)
$4,785.46 $58,286.90 $60,035.51 $30,461.37
The revenue associated with this First Amendment decreases the budgeted revenue established for Account 4501103A-45200, the revenue account for Building 553, for fiscal year 2023-2024 and is included in the mid-year budget proposal. Future appropriations for the subject Agreement will be considered at the time the annual budget is approved. 5 7
0 Strategic Plan Goal:

The City of Victorville Strategic Plan 2023-2026 identifies multi-year strategic goals and various strategies to work toward achieving those goals. Goal A fosters fiscal health through disciplined long-term planning, cost control, increased revenues, and cost recovery.

Background:

ComAv has been a major tenant at the Southern California Logistics Airport (“SCLA”) for over twenty years, offering fully integrated aircraft asset management service to a vast array of aircraft owners and operators. As a fully certified commercial aircraft maintenance provider, ComAv performs maintenance inspections, repairs and modifications on Boeing and Airbus commercial jetliners, as well as asset management and engine services. ComAv provides both active and inactive aircraft storage, with over 200 aircraft currently in its custody. ComAv’s involvement in the end-of-lifecycle business entails divisions specializing in the aircraft parts and recycling sectors, including management of an engine pool in excess of 150 engines.

With over 250 employees, ComAv is the largest employer at the SCLA. Since executing their first lease agreement in 1998, ComAv has grown to its current leasehold estate that includes nine SCLA owned buildings and a significant ground leasehold interest.

Discussion:

As the economy recovered from the pandemic, ComAv lost a sizable portion of their maintained aircraft storage business due to airlines placing aircraft back into service.

These market changes have required ComAv to scale back certain business operations and reduce their fixed expenditures. Concurrently, ComAv started seeking new business interests, primarily in the form of heavy aircraft modifications, inspections, and the associated repairs.

In order to reduce its rent expenses, ComAv wanted to vacate Building 553 and terminate its lease, effective February 29, 2024. Staff countered with a termination date of May 31, 2024, in exchange for a lease renewal of Building 720, Suite 102. Said renewal stipulates a three percent inflated rate, and the addition of 1,239 square feet of storage space. With the tenant improvements made by ComAv and certain additional improvements staff envisions, it is likely Building 553 will bring increased revenues in the future, allowing for the mutual benefit of both ComAv and the SCLA.

Because ComAv is the SCLA’s largest aeronautical customer and employer, business cooperation and partnering is imperative for the financial health of both organizations.

Therefore, staff recommends that Your Honorable Southern California Logistics Airport Authority Board (1) approve the First Amendment to the Standard Lease Agreement for (Buildings 553 and 739 Amendment), by and between the SCLAA and ComAv Technical Services, LLC, (“ComAv”); and (2) authorize the Airport Director to execute said Amendment.
5 7
0 Staff remains available for any questions you may have.

CER
Attachments: A. General Site Map
B. First Amendment to the Standard Lease Agreement for Buildings 553 and 739
C. Standard Lease Agreement for Buildings 553 and 739

ATTACHMENT A

GENERAL SITE MAP

Attachment A
Bldg 739
Aerospace Dr.

Bldg 553

ATTACHMENT B

FIRST AMENDMENT TO THE

STANDARD LEASE AGREEMENT FOR
BUILDINGS 553 AND 739

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

FIRST AMENDMENT TO STANDARD LEASE AGREEMENT
BUILDINGS 553 AND 739
This First Amendment to Standard Lease Agreement (the “First Amendment”) is made this day of February 2024, by and between SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY (SCLAA), a California joint powers authority, (hereinafter referred to as “Lessor”) and COMAV TECHNICAL SERVICES, LLC, (“ComAv”) a California Limited Liability company (hereinafter referred to as “Lessee”).

Lessor and Lessee are sometimes referred to hereinafter individually as a “Party” and collectively as the “Parties”.

RECITALS
These Recitals are included to provide context for the Parties need to enter into a First Amendment to the Standard Lease Agreement and to understand the basis upon which certain terms and conditions have been included. This Amendment and Recitals are not intended, nor should these be construed, to supersede or amend the specific terms and conditions of this First Amendment, unless as otherwise stated herein.

A. Lessor and Lessee entered into a Standard Lease Agreement dated December 30, 2021 (the “Original Lease”) pertaining to the lease of certain premises known as Buildings 553 and 739 at the Southern California Logistics Airport (“SCLA”); and B. Due to unforeseeable circumstances, including a dramatic decrease in aircraft requiring active storage and maintenance in the post-pandemic economy, the Lessor and Lessee both agree the Original Lease must be amended to eliminate Building 553, which is no longer needed or economically viable for the Lessee; and D. The Lessee agrees to extend and expand its leasehold presence in a more critical SCLA facility (Building 720) pursuant to a new lease to be executed concurrently with the execution of this First Amendment; and
E. Therefore, the Lessee, pursuant to meeting with staff on January 22, 2024, has requested the Original Lease be bifurcated to exclude Building 553 and Lessee to be released from all Lessee obligations pertaining to Building 553 effective May 31, 2024.

First Amendment to Lease Agreement – Buildings 553 & 739 ComAv Technical Services

AMENDED TERMS AND CONDITIONS
(1) Section 1(a) of the Original Lease is amended herein to read as follows:
(a) The Leased Premises shall include a portion of that certain real property designated as Building 739, located on the SCLA grounds at 18676 Phantom West, Victorville California 92394, comprised of approximately Twelve Thousand Five Hundred Eleven (12,511) square feet of office, storage and warehouse space, together with the improvements thereon, as depicted in Exhibit A attached hereto and incorporated herein by this reference and as of June 1, 2024 Building 553 shall no longer be a part of the Leased Premises and shall be vacated by ComAv; and (2) Section 6(a) of the Original Lease is amended herein as follows:
(a) Monthly Base Rent. Effective June 1, 2024, Lessee shall pay to Lessor as rent for the Leased Premises the amount of Four Thousand Seven Hundred Eighty-Five Dollars and Forty-Six Cents ($4,785.46) per month (the “Monthly Base Rent”).

Commencing on January 1, 2025, the Monthly Base Rent shall be increased by three percent (3%), and on each annual anniversary of the Lease Commencement Date thereafter during the Term (or during any Option Term exercised in accordance with the provisions of Section 3 hereof), the then-current Monthly Base Rent shall be increased by an additional three percent (3%). All further references to the Monthly Base Rent shall mean and include any such increased amount as calculated under the provisions of this paragraph.
(3) Except as otherwise amended herein, all other terms and conditions set forth in the Original Lease, dated December 30, 2021, shall remain in full force and effect.

END OF THIS PAGE
First Amendment to Lease Agreement – Buildings 553 & 739 ComAv Technical Services

IN WITNESS WHEREOF, the parties have executed this First Amendment Agreement as of the day and year first written above.

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY (SCLAA) Signature: ________________________________________
C. Eric Ray, Airport Director Date
ATTEST:

Signature: ________________________________________
Date
COMAV TECHNICAL SERVICES, LLC. (“COMAV”)
Signature: ________________________________________
Udo Rieder, CEO Date
APPROVED AS TO STANDARD FORM:

Signature: ________________________________________
SCLAA Legal Counsel Date
First Amendment to Lease Agreement – Buildings 553 & 739 ComAv Technical Services

EXHIBIT A

DESCRIPTION OF LEASED PREMISES
Building 739 comprised of approximately Twelve Thousand Five Hundred Eleven (12,511) square feet of office, storage and warehouse space located at 18676 Phantom West, Victorville California 92394, as depicted on Exhibit A-1 and Exhibit A2, together with the improvements thereon.

First Amendment to Lease Agreement – Buildings 553 & 739 ComAv Technical Services

Exhibit A-1
+/- 12,511 Total Square Feet
Storage Space
Storage Space
Storage Space
Office Space

Exhibit A-2
Bldg 720
Readiness Street
Leasehold Premises
Bldg 744Bldg 739

STANDARD LEASE AGREEMENT
FOR BUILDING 6828

ATTACHMENT C

STANDARD LEASE AGREEMENT FOR
BUILDINGS 553 AND 739
SCLAA Standard Lease Page 1 ComAv Buildings 553 & 739
SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITYSTANDARD LEASE AGREEMENT (BUILDINGS 553 AND 739) This Lease Agreement (the “Lease”), dated this _________ day of ______________, 2021, for reference purposes only, is made by and between the SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY (“SCLAA”), a California joint powers authority, (hereinafter referred to as “Lessor”) and COMAV TECHNICAL SERVICES, LLC, (“ComAv”) a Delaware Limited Liability Company (hereinafter referred to as “Lessee”). Lessor and Lessee are sometimes referred to hereinafter individually as a “Party” and collectively as the “Parties.”RECITALSA. The United States Air Force (“Air Force”) and the Victor Valley EconomicDevelopment Authority (“the Authority”) have previously entered into certain Department of the Air Force Leases pertaining to portions of former George Air Force Base, which is now known as Southern California Logistics Airport (“SCLA”) (hereinafter referred to as the “Air Force Leases”).B. The Authority has delegated its decision-making authority with respect tothe SCLA to the Lessor, which now has the authority to enter into transactions on behalf of the Authority. C. The Air Force (“Grantor”) and the SCLAA (“Grantee”) have entered intocertain Air Force Quitclaim Deed(s) (“Quitclaim Deed(s)”), which release and forever quitclaim to the Grantee all the real property described in such Quitclaim Deed(s), subject to the Covenants, Conditions and Restrictions set forth in the Quitclaim Deed(s). D. Lessee seeks to lease from the Lessor a portion of the real property subjectto the Quitclaim Deed(s) (hereinafter defined as the “Leased Premises” and described more fully below) under the terms and conditions set forth in this Lease. E. Although the Leased Premises are subject to and governed by theCovenants, Conditions and Restrictions of the Quitclaim Deed(s), certain portions of the SCLA (some of which may include appurtenances, access/use rights, privileges and/or easements associated with the Leased Premises) are subject to the provisions and conditions of the Air Force Leases, and Lessee shall be subject to and comply with any and all provisions and conditions of such Air Force Leases as applicable. F. The Parties previously entered into a lease for Building 739 on May 21,2020, and the Parties intend that this Standard Lease Agreement will supersede the Building 739 Lease in its entirety and said Building 739 Lease shall be of no further force and effect upon the execution by the Parties hereof.

SCLAA Standard Lease Page 2 ComAv Buildings 553 & 739
TERMS AND CONDITIONS1. Leased Premises. Subject to the terms and conditions herein contained, Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor the Leased Premises described as follows: (a) A portion of that certain real property designated as Building 553, located on the SCLA grounds at 13123 Aerospace Drive, Victorville California 92394, comprised of approximately of Twenty-Two Thousand Two Hundred Fifty-Eight (22,258) square feet of office and warehouse space and approximately Seventy-One Thousand Two Hundred Ninety-One (71,291) square feet of fenced yard space, and Building 739, located on the SCLA grounds at 18676 Phantom West, Victorville California 92394, comprised of approximately Twelve Thousand Five Hundred Eleven (12,511) square feet of office, storage and warehouse space, together with the improvements thereon, as depicted in Exhibit A attached hereto and incorporated herein by this reference; and (b) all appurtenances, rights, privileges and easements in any way applicable thereto. 2. Term. The Initial Term of this Lease shall be for a period of five (5) years, commencing on January 1, 2022, (the “Lease Commencement Date”) and expiring on December 31, 2026, (the “Expiration Date”) unless sooner terminated or extended as hereinafter provided. 3. Option to Extend Term. Upon expiration of the Initial Term, Lessee shall have the option to renew this Lease for one (1) additional five (5) year term (the “Option Term”), provided that: (1) Lessee is in good standing and otherwise in full compliance with all of the terms and conditions of this Lease; (2) Lessee provides Lessor written notice of its desire to renew no later than three hundred sixty-five (365) days prior to the expiration of the Initial Term; and (3) Lessor confirms in writing Lessee’s Option Term. Upon confirmation of such exercise by Lessor, all references to the Expiration Date shall mean December 31, 2031. All further references to the Term of this Lease shall mean and include the Initial Term and any confirmed Option Term. 4. Termination. This Lease shall only terminate prior to the Expiration Date for such reasons as are specifically set forth in the provisions of this Lease. In addition, the Parties agree that this Lease shall supersede in its entirety the Building 739 Lease dated May 21, 2020, which Building 739 Lease shall hereafter be deemed terminated. 5. Right to Terminate for Development. With respect to any building or facility comprising the Leased Premises (including any additional access or rights of use specified in this Lease) which Lessee occupies pursuant to this Lease, after Lessee’s execution of this Lease, Lessor shall have the right, upon giving Lessee ninety (90) days’notice in writing, to terminate this Lease. Such right shall only be exercised in good faith to the extent Lessor requires the current space for the development of the SCLA.

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6. Rent.
(a) Monthly Base Rent. During the first year of the Initial Term, Lessee shall pay to Lessor as rent for the Leased Premises the amount of Fourteen Thousand Seven Hundred Forty-Eight Dollars and Eighty-Nine Cents ($14,748.89) per month (the “Monthly Base Rent”). Commencing on January 1, 2023, the Monthly Base Rent shall be increased by three percent (3%), and on each annual anniversary of the Lease Commencement Date thereafter during the Term (or during any Option Term exercised in accordance with the provisions of Section 3 hereof), the then-current Monthly Base Rent shall be increased by an additional three percent (3%). All further references to the Monthly Base Rent shall mean and include any such increased amount as calculated under the provisions of this paragraph.
(b) Tenant Improvements. Within five (5) months of the Lease Commencement Date, Lessee shall undertake and substantially complete, at its sole expense, certain tenant improvements to the Leased Premises (the “Tenant Improvements”) as further described in Exhibit E attached hereto and incorporated herein by this reference. Lessee shall construct the Tenant Improvements in accordance with Sections 14, 17 and 22 of this Lease, using its own staff and/or properly licensed and insured contractors and in full compliance with any applicable prevailing wage or public bidding requirements.
(c) Rent Credits. As consideration for substantially completing the Tenant Improvements within the time period set forth above, and subject to the provisions of subsections I and II hereof, Lessor shall, commencing July 1, 2022, and continuing for five (5) consecutive months of the Initial Term of this Lease, provide Lessee with a monthly rental credit in an amount equal to one fifth (1/5) of the total costs of the Tenant Improvements to Building 553 and 739, which are estimated to be Sixty-Nine Thousand Dollars ($69,000). The rental credit shall be based upon actual costs incurred by Lessee to construct the Tenant Improvements, as verified and approved by Lessor pursuant to subsection I below, but in no event shall exceed a total of Sixty-Nine Thousand Dollars ($69,000). The rental credit shall be applied on a monthly basis for five (5) months toward the Lessee’s Monthly Base Rent in an amount not to exceed Thirteen Thousand Eight Hundred Dollars ($13,800), effective July 1, 2022 as set forth above.

I. Following the substantial completion of the Tenant
Improvements, Lessee shall provide to Lessor all invoices and Tenant Improvement Certifications, as further described in Exhibit F, and other evidence of actual cost incurred together with a cost summary cover page (the “Close-Out Statement”). Upon receipt of the Close-Out Statement, Lessor shall verify same and calculate the actual total amount of the rent credits due to Lessee.

II. Should Lessee not substantially complete the Tenant Improvements within five (5) months following the Lease Commencement Date (May 31, 2022) and provide a Close-Out Statement to Lessor documenting the actual costs incurred, Lessee shall not be eligible for rent credits described in Section 6.c.

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(d) Payment. Monthly Base Rent shall be payable in advance prior to the first (1st) day of each calendar month and without demand to: Southern California Logistics Airport AuthorityAttention: Airport Director 18374 Phantom WestVictorville, California 92394 or at such other place as Lessor may designate in writing from time to time. Lessee shall also pay to Lessor within thirty (30) days of presentation of an invoice, such other chargesas it may incur for use of facilities and services at the SCLA which shall be charged in accordance with the SCLA Rules and Regulations as set forth in Exhibit B, attached hereto and incorporated herein by this reference, as such may be amended from time to time by Lessor. 7. Security Deposit. Lessee shall deposit with the Lessor upon execution hereof Fourteen Thousand Seven Hundred Forty-Eight Dollars and Eighty-Nine Cents($14,748.89) with Four Thousand Three Hundred Seventy-Nine Dollars ($4,379) already on deposit with Lessor as security for Lessee’s faithful performance of Lessee’s obligations hereunder (the “Security Deposit”). If Lessee fails to pay rent or other charges due hereunder, fails to pay any utility or service provider, or otherwise defaults with respect to any provision of this Lease, the Lessor may use, apply or retain all or any portion of said deposit for payment of any rent or other charges in default or for the payment of any other sum to which the Lessor may become obligated by reason of Lessee’s default, or to compensate the Lessor for any loss or damage which the Lessormay suffer thereby. The Security Deposit amount must be maintained by Lessor in the minimum amount of the Security Deposit required under this section. 8. Brokerage Commission. Lessor and Lessee represent and affirm to each other that they have not had any dealings with any real estate brokers, finders or agents and no commissions or fees are payable by either Party in connection with this Lease. 9. Late Charge. Lessee hereby acknowledges that late payment by Lessee to Lessor of any installment of rent, or any other sums due hereunder will cause Lessorto incur costs not contemplated by the Lease, the exact amount of which will be extremely difficult to ascertain. Accordingly, if any installment of rent, or any other sum due from Lessee is not received by the Lessor within ten (10) days after such amount is due, whether or not any notice of default or other notice has been given, Lessee shall pay to the Lessor a charge equal to six percent (6%) of the amount past due (the “Late Charge”), in addition to the payment of the past due amount itself. The Parties hereby agree that such Late Charge represents a fair and reasonable estimate of the costs the Lessor will incur by reason of late payment by Lessee, and no more than one Late Charge shall be assessed per month. Notwithstanding the foregoing, in the event the Lessee elects to make annual payments in advance, then no Late Charge shall apply.

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10. Limited Right to Possession of the Leased Premises. Lessor shall deliver possession of the Leased Premises to Lessee on or before the Lease Commencement Date, free and clear of all tenants, occupants, and right of any third parties except as hereafter provided in this Section 10. Lessee agrees that its possession of the Leased Premises shall be subject to any outstanding easements and rights-of-way not within the control of the Lessor and further to the right of entry by the Air Force and such other government entities as provided for under the Quitclaim Deed(s). The Lessor shall use best efforts to ensure the quiet use and enjoyment of the Leased Premises by Lessee. However, unreasonable interference by Lessor or the Air Force with Lessee’s quiet enjoyment of the Leased Premises that results in material and demonstrable financial detriment to Lessee and Lessee being unable to continue its business functions in a commercially reasonable manner, shall be grounds for termination of the Lease by Lessee. 11. Holding Over. In the event Lessee, with the Lessor’s prior written consent, holds over and continues in possession of the Leased Premises, or any part thereof, after the Expiration Date of this Lease, such occupancy shall be considered a month-to-month tenancy subject to all the terms and conditions of this Lease in effect on the day immediately preceding the Expiration Date, except that the Monthly Base Rent for any such holdover period shall be increased to one hundred fifty percent (150%) of the Monthly Base Rent. If Lessee, without the Lessor’s prior written consent, holds over or continues in possession of the Leased Premises, or any part thereof, after the Expiration Date of this Lease, such occupancy shall be deemed a tenancy at sufferance, permitting the Lessor to immediately commence eviction proceedings without notice to Lessee. 12. Right to Relocate. With respect to any building which Lessee occupies pursuant to this Lease, after Lessee’s execution of this Lease, Lessor, to the extent required by the SCLAA, shall have the right, upon giving Lessee ninety (90) days notice in writing, to provide and furnish Lessee with space elsewhere in such other building within the boundaries of the SCLA of approximately the same size and with similar characteristics and amenities (such as access to streets and runways) as the Leased Premises, and to place Lessee in such new building space at the Lessor’s expense. Such right shall only be exercised in good faith to the extent the Lessor requires the Leased Premises for the development of the SCLA. In the event Lessor moves Lessee to said new space within any building then this Lease with respect to the original Leased Premises and each and all of the terms and covenants and conditions thereof shall thereupon remain in full force and effect and be deemed applicable to such new space. If the space in the building is smaller in size than the existing Leased Premises, then Lessor shall receive a reduction in rent equal to the difference between the size (using interior square footage) of the existing Leased Premises and the size of the new building. However, Lessee shall not be assessed additional rent if the new space is larger in size the Lessee’s then existing Leased Premises, unless the new building exceeds the size of the existing Leased Premises by more than fifteen percent (15%). Lessee reserves the right to reject relocation to a specific location which does not comply with the terms of this provision.

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13. Maintenance. Except for excessive repair and maintenance necessitated solely by Lessor’s activities, Lessee shall at all times during the Term hereof and until surrender and termination, keep and maintain the Leased Premises in good and substantial order and repair, and shall undertake all necessary repair and maintenance of the Leased Premises. Lessee shall be responsible for all operating expenses associated with maintaining the Leased Premises including, but not limited to: cleaning; light bulb replacement; procurement of supplies and maintenance materials; preventative maintenance; repair; signs; sidewalks; all monthly, quarterly, and annual inspection/servicing and repair of the Leased Premises mechanical, electrical, lighting, plumbing, and life safety systems; furniture and window cleaning; servicing of fire extinguishers and fire suppression systems; repairs to trade fixtures and/or equipment, doors, ceilings, roofing, floors; exterior painting, resurfacing paved exterior areas and the like; landscaping of parking lot, associated fees, etc. Lessee agrees at Lessee’s sole cost and expense to procure and maintain throughout the Term of this Lease, or any extension thereof, contracts for the inspection/servicing and maintenance of HVAC equipment, fire extinguishing and suppression systems, fire alarms and/or smoke detection systems, and air compressor systems. Lessee also agrees throughout the Term (or any extension thereof) to supply copies of all such contracts and any fire or life safety related certifications and/or inspection records to the Lessor in a timely manner.Lessor discloses that HVAC unit in Building 553 is not operative and cannot be repaired. 14. Use and Condition of Leased Premises. The Leased Premises are to be used by Lessee for those purposes more particularly provided for in Exhibit D, attached hereto and incorporated herein by this reference, and for no other purpose unless expressly agreed to by the Lessor in writing. Lessee agrees to use the Leased Premises in such a manner as to not interfere with the Lessor’s rights in the Leased Premises or the surrounding areas, to comply with all airport rules and regulations, all applicable governmental laws, ordinances, and regulations in connection with its use of the Leased Premises, to keep the Leased Premises in a clean and sanitary condition, and to use all reasonable precaution to prevent damage, or injury to the Leased Premises. (a) Permits. Lessee, at its sole cost and expense, shall apply for and obtain any and all permits and/or certifications required by any federal, state or local governmental entity, including but not limited to the Mojave Desert Air Quality Board, in connection with the painting, maintenance and/or overhaul of aircraft in or about the Leased Premises. Such permits shall include, but not be limited to, any which may be required for the air handling and ventilation requirements for the Leased Premises. Furthermore, Lessee shall coordinate and cooperate with the Mojave Desert Air Quality Board as may be required from time to time. Any and all such permits and/or certifications shall be obtained in such a manner so as to run in favor of the Leased Premises and/or the Lessor, and such permits or certifications shall remain with the Leased Premises upon the expiration or termination of the Lease. (b) No Warranties. Except as provided herein, Lessee agrees that no promises, covenants, representations, statements or warranties have been made on behalf of the Lessor to Lessee respecting the condition of the Leased Premises, or the SCLAA Standard Lease Page 7 ComAv Buildings 553 & 739
manner of operating the Leased Premises or the maintaining of any repairs to the Leased Premises. (c) Acceptance of Leased Premises. Lessee acknowledges that it has satisfied itself by its own independent investigation that the Leased Premises are suitable for its intended use, and that neither the Lessor nor the Lessor’s agent or agents have made any representation or warranty as to the present or future suitability of the Leased Premises for the conduct of Lessee’s business. Lessee’s taking possession or use of the Leased Premises for any purpose shall constitute Lessee’s acceptance of the Leased Premises “as-is” in its existing condition, which condition shall be established as set forth in Exhibit D.(d) Notice of Presence of Asbestos and Lead-Based Paint. Lessee, its successors and assigns are warned that the Leased Premises may contain asbestos materials and lead-based paint materials. No warranties, either expressed or implied, are given with regard to the quantity, location or condition of the asbestos containing materials or the lead-based paint materials. Lessee, its successors, and assigns, shall be deemed to have relied solely on their own judgment in assessing the overall condition of all or any portion of the Leased Premises, including any asbestos hazards or lead-based paint hazards or concerns. Lessee acknowledges that Lessee was given every opportunity to inspect the Leased Premises to assess the risk, if any, from asbestos containing material or lead-based paint materials. The Lessor assumes no liability for damages for personal injury, illness, disability or death to Lessee or to Lessee’s successors, assigns, employees, invitees, or any other persons subject to Lessee’s control or direction, or to any person, including members of the general public arising from or incident to the purchase, transportation, removal, handling, use, disposition or any activity causing or leading to contact of any kind whatsoever with asbestos or lead-based paint on the Leased Premises which is the subject of this Lease, whether Lessee, its successors or assigns has or have properly warned or failed to properly warn the individuals injured. Lessee, its successors and assigns, further agree that in its use and occupancy of the Leased Premises, it will comply with all federal, state and local laws relating to asbestos and lead-based paint. (e) Personal Property. Lessee shall, at the termination of this Lease, by lapse of time or otherwise, remove all of Lessee’s personal property, repair any damage to the Leased Premises resulting therefrom, and surrender the Leased Premises to the Lessor in as good a condition as when Lessee took possession, normal wear and tear excepted. 15. Waste or Nuisance. Lessee shall not commit or permit the commission by others of any waste on the Leased Premises. Lessee shall not maintain, commit, or permit the maintenance or commission of any nuisance on the Leased Premises nor shall Lessee use or permit the use of the Leased Premises for any unlawful purpose.

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16. Taxes. Lessee shall pay when due and prior to delinquency all taxes, assessments, and other charges including possessory interest taxes levied or imposed by any governmental entity on the possessory interest of Lessee in the Leased Premises and the personal property, trade fixtures, appliances, and leased equipment placed by Lessee in, on, or about the Leased Premises during the Term (or any extension thereof) of this Lease. Lessee recognizes that the interests of Lessee in this Lease shall be subject to the imposition of a possessory interest tax by the San Bernardino County Assessor, and Lessee agrees to pay such tax amount as may be so levied with respect to the possessory interest of Lessee in the Leased Premises under this Lease. Lessee further acknowledges that pursuant to California Health and Safety Code Section 33673, the property shall be assessed in the same manner as privately owned property and Lessee shall pay taxes upon the assessed value of the entire property and not merely the assessed value of its leasehold interest. 17. Compliance With Covenants, Conditions and Restrictions of the Quitclaim Deed(s), Air Force Leases and Related Agreements. (a) Lessee acknowledges that copies of the applicable Quitclaim Deed(s) and the Air Force Leases are available and on file in the SCLA office. (b) Lessee expressly acknowledges that the Lessor has assumed certain duties and obligations to the Air Force (Grantor) under the Quitclaim Deed(s) affecting the use and occupancy of the Leased Premises. Lessee further agrees that as of the Lease Commencement Date, it shall observe and perform the duties and obligations of the Lessor (Grantee as the case may be in this Section 17) relating to the Leased Premises in favor of the Air Force which arise under the Quitclaim Deed(s). These duties and obligations as assumed by Lessee include, but are not limited to, the following which are presented below for purposes of reference and convenience:I. Reserving unto the Grantor all oil, gas, and other mineral resources of any kind or nature in the mineral estate of the Leased Premises, provided, however, that such reservation is without surface right of entry or extraction rights; and II. Reserving unto the Grantor right of access to the Leased Premises, extending such access to the United States Environmental Protection Agency (“EPA”) and the State of California (the “State”), and their respective officials, agents, employees, contractors and subcontractors for the purposes of the Installation Restoration Program (IRP) of the Grantor or the Federal Facility Agreement (FFA). (c) Lessee further expressly acknowledges that it is subject to and shall comply with all provisions and conditions of the applicable Air Force Leases. (d) Any use, occupancy or activity of Lessee on the Leased Premises which may result in either the receipt by the Lessor of a notice of violation or default or breach from the Air Force or the Federal Aviation Administration (“FAA”) under the Quitclaim Deed(s) or a notice of default, violation or breach from the Air Force or the FAA SCLAA Standard Lease Page 9 ComAv Buildings 553 & 739
under the Air Force Leases, shall be deemed to be a default of Lessee under this Lease. The response of the Lessor following receipt of any such notice of violation, default or breach, shall not waive, stay or otherwise mitigate or remedy the default of Lessee to the Lessor under this Lease. Lessee shall have no right under this Lease to participate in any proceeding between the Air Force, the FAA and the Lessor for the resolution of an alleged default, breach or other dispute of the Parties arising under the Quitclaim Deed(s) and/or the Air Forces Leases, except to the extent the Lessee is alleged to have directly caused such violation, breach or default. (e) Lessee acknowledges that the Leased Premises may be subject to a future Declaration of Covenants, Conditions and Restrictions to be recorded in the official records of San Bernardino County, California, as amended (the “CC&Rs”). In addition to any other applicable assessments, this Lease may be subject to anyassessments levied pursuant to the CC&Rs and applicable to the Leased Premises, determined by the ratio that the rentable area of building on the Leased Premises bears to the total net rentable area of building or buildings which include the Leased Premises and for which a separate assessment is made pursuant to the CC&Rs. 18. Insurance. (a) Commercial General Liability Insurance. Lessee shall procure and maintain at its own expense, during the Term of this Lease or any extension thereof, Commercial General Liability insurance with a company or companies acceptable to Lessor, of not less than One Million Dollars ($1,000,000) per occurrence, Two Million Dollars ($2,000,000) in the aggregate, for bodily injury, personal injury, death, loss, or damage to property resulting from the activities conducted by the Lessee or its officers, employees, servants, volunteers, and agents and independent contractors on the Leased Premises. Such policies shall provide coverage for bodily injury, personal injury and property damage to the Leased Premises based upon, involving, or arising out of the use, occupancy or maintenance of the Leased Premises and all areas appurtenant thereto. (b) Property Casualty Insurance. Lessee shall keep in full force and effect during the Term of this Lease or any extension thereof, a policy of insurance against fire, vandalism, malicious mischief, and all other perils as are from time to time included in an “all risk” coverage endorsement insuring Lessee’s improvements constructed on the Leased Premises, if any, in an amount which is at least one hundred percent (100%) of the full replacement cost. Lessee shall also be required by Lessor to maintain at its own expense insurance covering any Tenant Improvements (if any are specified in this Lease), other improvements to the Leased Premises, Business Income/Extra Expense, Business Personal Property, Supplies, and Equipment. Lessee's policy must also include a Loss Payee Endorsement naming the Southern California Logistics Airport Authority (Lessor) as a “Loss Payee.” (c) Commercial Vehicle Liability Insurance. Lessee shall further procure and maintain, at its own expense during the Term of this Lease or any extension thereof, a Commercial or Business Auto Liability insurance policy covering Symbol 1 (any auto), SCLAA Standard Lease Page 10 ComAv Buildings 553 & 739
for all owned, non-owned, leased, and hired autos, trucks, trailers, or semi-trailers, including and not limited to, any machinery or apparatus attached thereto. Limits shall be no less than One Million Dollars ($1,000,000) per accident or Combined Single Limit (“CSL”) for bodily injury and property damage. (d) Workers’ Compensation Insurance. Lessee shall procure and maintain at its own expense, during the Term of this Lease or any extension thereof, workers' compensation insurance, providing coverage as required by the California State Workers' Compensation Law. If any class of employees employed by Lessee is not protected by the California State Workers' Compensation Law, Lessee shall provide adequate insurance for the protection of such employees to the satisfaction of the Lessor. (e) Additional Insured Status. The Southern California Logistics Airport Authority (Lessor), the City of Victorville, the City Attorney, the Victor Valley Economic Development Authority, the United States Air Force and their officers, officials, employees, servants, volunteers, agents and independent contractors are to be covered as additional insureds on the Commercial General Liability Policy (“CGL”) with respect to liability arising out of work or operations performed by or on behalf of the Lessee, including materials, parts, or equipment furnished in connection with such work or operations. General Liability coverage can be provided in the form of an endorsement to the Lessee’s insurance. (f) Waiver of Subrogation Rights. Lessee shall require the carriers of all required insurance policies to waive all rights of subrogation against the Southern California Logistics Airport Authority, the City of Victorville, the City Attorney, the Victor Valley Economic Development Authority, the United States Air Force and their officers, officials, employees, servants, volunteers, agents and independent contractors.(g) Environmental Liability. If Lessee performs work that includes using or storing Hazardous Materials on the Leased Premises, insurance is also required for third party claims for bodily injury, property damage, and remediation costs stemming from pollution incidents from the Lessee's operations.(h) Primary Coverage. For any claims related to this Lease, the Lessee’s coverage shall be primary insurance as respects the Southern California Logistics Airport Authority (Lessor), the Victor Valley Economic Development Authority, the City of Victorville, the City Attorney and the United States Air Force and their officers, officials, employees, volunteers, contractors and subcontractors. Any insurance or self-insurance maintained by the Southern California Logistics Airport Authority (Lessor), the Victor Valley Economic Development Authority, the City of Victorville, the City Attorney and the United States Air Force and their officers, officials, employees, volunteers, contractors and subcontractors shall be in excess of the Lessee’s insurance and shall not contribute with it.

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19. Proof of Insurance Coverage.(a) Lessee shall secure from a good and responsible company or companies authorized to do insurance business in the State of California the policies of insurance required by this Lease and furnish to Lessor certificates of said insurance on or before the commencement of occupancy under this Lease. Insurance is to be placed with insurers with a current A.M. Best’s rating of not less than A:VII, unless otherwise acceptable to the Lessor.(b) The certificates of insurance shall bear an endorsement whereby it is provided that, in the event of cancellation or amendment of any required insurance policy for any reason whatsoever, Lessor shall be notified by mail, postage prepaid, not less than thirty (30) days before the cancellation or amendment is effective. In the caseof non-payment, ten (10) days advance written notice shall be given.(c) The certificates of insurance shall bear an endorsement whereby it is provided that the respective insurance policy shall not be terminated or expire without first providing thirty (30) days written notice to Lessor of such termination or expiration. (d) The certificates of insurance shall indicate that the respective insurance policy will be maintained throughout the Term of this Lease, or any extension thereof. 20. Personal Property at Risk of Lessee. All personal property which Lessee maintains at the Leased Premises shall be at the risk of Lessee only. Except for the grossly negligent, reckless, or unlawful intentional acts of the Lessor, its agents, employees, guests or invitees, the Lessor shall not be liable for any damage to any property of Lessee or for any damage to Lessee’s property in moving the same to or from the Leased Premises. 21. Utilities and Other Services. (a) Lessee shall contract with and pay the applicable provider, whether the provider is the Lessor or another party, all charges for water, gas, electricity, sewer, waste disposal, or other utilities used or supplied upon or in connection with its use of the Leased Premises and shall indemnify, defend and hold harmless the Lessor against any liability on account thereof. Lessee shall obtain separate metering devices for utility services, as applicable. Lessee agrees to promptly reimburse the Lessor upon receipt of invoice, its proportionate share of the actual cost of utility services from any common utility service, which may have been paid by Lessor. In addition to the amount of the utility bill that the Lessor may have paid, Lessee shall pay to Lessor a three percent (3%) administrative fee for any pass-through billing processed. In no event shall the Lessor be liable for any interruption or failure in the supply of any such utilities to the Leased Premises.

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(b) Consent to Energy Use Data Disclosure. By executing this Lease, Lessee hereby consents to disclosure of its energy usage data as required for Lessor to comply with California Public Resources Code section 25402.10 and the implementing regulations of the California Energy Commission (20 Cal. Code Regs., §§ 1680 through 1685). Strictly for the purposes of ensuring such compliance, including any required public disclosure of aggregated energy use, Lessee agrees to provide such energy usage data directly to Lessor and/or authorizes Lessor to obtain the required energy usage data directly from Lessee’s utility providers upon request without the need to execute any further authorizations or consent forms. Lessee’s consent and authorization is deemed given upon the execution of this Lease and shall continue to be in effect throughout the Term or any extension thereof. 22. Alterations, Improvements and Additions. (a) Lessee shall not make any alterations, improvements, or additions to the Leased Premises (collectively hereinafter the “Improvements”) without the prior written consent of the Lessor. Any machinery, equipment, or apparatus, which belongs to Lessee, may be removed by Lessee at any time prior to the expiration of the Term of this Lease or any extension thereof. (b) Once completed, Improvements authorized in writing by Lessor and/or any specific Tenant Improvements as may be provided for elsewhere in this Lease, shall not be removed by Lessee, unless so required by the Lessor in its sole discretion. At the end of the Term (or any extension thereof) of this Lease (or upon any earlier termination as may be provided for herein) Lessor shall have the option to either require Lessee to remove the Improvements or Tenant Improvements or elect to have such Improvements or Tenant Improvements become the property of Lessor. In the case of removal of equipment or fixtures, Lessee shall restore the area of the Leased Premises from which such removals are made to its original condition. Lessee shall require the issuance of a Faithful Performance Bond and a Payment Bond for any work performed on the Leased Premises as set forth below: BOND REQUIREMENTS - A Faithful Performance Bond benefitting the Lessor in the amount of one hundred twenty-five percent (125%) of the bid amount and a Payment Bond in the amount of one hundred twenty-five percent (125%) of the bid amount. Bonds must be issued by an admitted surety insurer in the State of California. When a contract for constructing Lessor-authorized Improvements or Tenant Improvements is signed, the successful bidder shall provide, within ten (10) working days, the Faithful Performance and Payment Bonds in the amounts set forth above in this paragraph. 23. Airport Development. The Lessor, at its sole discretion, shall determine and may from time to time change the routes of surface ingress and egress to and from the Leased Premises, but agrees to locate such routes as conveniently as may be done for Lessee, having in mind the reasonable requirements of the Lessor with respect to the operation of the SCLA. Notwithstanding the above, if the rerouting of such ingress and SCLAA Standard Lease Page 13 ComAv Buildings 553 & 739
egress routes significantly disrupts the normal operations of Lessee such that it results in material financial detriment to Lessee, then Lessee shall have the right to terminate this Lease. 24. Signs. Lessee shall not post, install, erect, or operate any sign, placard, poster, or other device on any part of the Leased Premises without the prior written permission of the Lessor. Such signs as may from time to time be permitted by the Lessorshall be made, posted, maintained and removed, and repair any damage caused by removal, at Lessee’s own cost and expense. Lessor shall have the right to remove unauthorized signs at Lessee’s expense. Lessee shall be responsible for all costs associated with the purchase and installation of the required Building Standard Suite Signage in accordance with local codes. 25. Liens. Lessee shall not suffer or permit any liens to stand against the Leased Premises, or any part thereof, by reason of any work, labor, services, or materials done for, or supplied to Lessee or anyone holding the Leased Premises or any part thereof through or under Lessee. If any such lien shall at any time be filed against the Leased Premises, Lessee shall cause such lien to either be discharged of record sixty (60) days after the date that Lessee receives notice of the filing. Notwithstanding the above, in any bona fide dispute between Lessee and any third party concerning work done by the third party on or for the Leased Premises, and as a result of the dispute the third party files a lien against the Leased Premises, then, in lieu of obtaining the discharge of the lien within the sixty (60) day period, Lessee, at its option, may either file suit against the third party, a part of the suit being to judicially negate or remove the lien or Lesseemay file an appropriate bond or other device allowed by law to remove the lien.26. Inspection by the Lessor. Lessee shall permit the Lessor, or its agents, representatives, or employees to enter the Leased Premises at mutually agreeable, reasonable times for the purpose of inspecting the Leased Premises to determine whether Lessee is complying with the terms of this Lease, for the purpose of doing other lawful acts that may be necessary to protect the Lessor’s interest in the Leased Premises, or for the purpose of performing the Lessor’s duties under this Lease. Except in the event of an emergency, the Lessor shall contact Lessee, no less than twenty-four (24) hours prior to the time that Lessor desires to enter the Leased Premises to arrange a mutually agreeable time for the inspection. 27. Damage or Destruction of Leased Premises. Unless occasioned by the negligence or intentionally unlawful act of Lessee, if, during the term of this Lease, any portion of the Leased Premises shall be damaged by fire or other catastrophic cause, so as to render such portion of the Leased Premises untenable, the obligations under this Lease shall be immediately suspended while such portion of the Leased Premises remains untenable. In the event of such damage, the Lessee shall give Lessor notice of such untenable conditions and the Lessor shall elect in its sole discretion, whether to repair the Leased Premises or to cancel this Lease with respect thereto. It shall notify Lessee in writing of its election within thirty (30) days after such damage. In the event the Lessor elects to repair the Leased Premises, the work or repair shall begin promptly and SCLAA Standard Lease Page 14 ComAv Buildings 553 & 739
shall be carried on without unnecessary delay. In the event the Lessor elects not to repair the Leased Premises or portion thereof, the Lease shall be deemed canceled as of the date of damage with respect to the applicable portion. Such damage shall not extend the Lease Term. In the event that insurance proceeds are received by Lessee under the property casualty policy required to be carried by Lessee, and the Lease is terminated under this Section, the Lessor shall be entitled to the portion of such proceeds attributable to the fixtures, improvements, and other property which would remain with the Leased Premises, and Lessee shall be entitled to the portion of such proceeds attributed to the fixtures and property on the Leased Premises which would be removed by Lessee. Notwithstanding anything in this paragraph to the contrary, if the Leased Premises are rendered inadequate for Lessee to conduct its normal operations in or upon the Leased Premises (or such portion of the Leased Premises which is still tenantable), and it is reasonably anticipated that the damages shall not be repaired or otherwise resolved, within sixty (60) days of the date of the accident, then Lessee, at its sole and exclusive option, may immediately terminate this Lease. Additionally, irrespective of whether Lessee remains in possession and occupancy of the Leased Premises or elects to terminate this Lease, rent payable under this Lease shall abate during the period that the Leased Premises are not totally useable by Lessee. The abatement shall be pro rata in proportion to the ratio that the amount of space which Lessee is actually able to occupy and from which it is able to conduct operations bears to the total Leased Premises. Lessee shall continue to make all other payments during this period, including taxes. 28. Assignment and Subletting. Lessee shall not cause, or permit, by operation of law or otherwise, any assignment, encumbrance or transfer of this Lease or any estate or interest therein without the prior written consent of the Lessor. Lessee shall not sublet the Leased Premises or any part thereof without the prior written consent of the Lessor. Such consent is subject to consideration by Lessor of the financial arrangement between Lessee and its proposed subtenant and is subject to Lessor’s financial participation in such arrangement. In addition, if Lessee’s proposed sublease or assignment arrangement will result in any increased rents or profits accruing to Lessee in excess ofthe Monthly Base Rent due to Lessor under this Lease, such consent shall further be conditioned upon Lessor receiving one-half (1/2) of the excess amount thereof. An assignment or subletting shall not relieve Lessee of any of its obligations or liabilities under this Lease: both Lessee and any subsequent assignees of Lessee will be deemed to be bound hereunder. The Lessor’s consent to any such assignment, transfer or subletting shall not constitute consent to any further assignment, transfer or subletting. This provision is not intended, nor should it be construed, to prevent Lessee from allowing such independent contractors onto the Leased Premises who are involved in Lessee’s normal operations on the Leased Premises (such as repair and maintenance personnel, janitorial personnel, and similar personnel). Additionally, this provision should not be construed to prevent subcontractors of Lessee from conducting their work on the Leased Premises in conjunction with the normal operations conducted by Lessee. To the extent that Lessor must grant its consent for Lessee’s subcontractors to enter onto the Leased Premises for the above-described purposes, consent is hereby deemed to be granted.

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29. Indemnification. To the fullest extent permitted by law, Lessee hereby agrees to defend, indemnify and hold harmless Lessor, the City of Victorville, the Victor Valley Economic Development Authority, the United States Air Force and each of their respective officers, officials, employees, directors, agents, volunteers, independent contractors and assigns (collectively hereinafter the “Indemnified Parties”), from and against any and all claims, actions, suits, proceedings, demands, losses, judgments and costs and expenses, including attorneys’ fees (collectively hereinafter “Claims”), arising from any legal action or proceeding initiated by any individual or entity arising out of, or resulting from the performance of this Lease, except for any such Claims arising out of the sole negligence or willful misconduct of the Indemnified Parties. 30. The Lessor’s Environmental Representations.(a) Except as otherwise provided in Section 14 hereof, Lessee shall not be held responsible or deemed liable by the Lessor for any hazardous environmental condition on the Leased Premises, which existed prior to Lessee’s occupancy of the Leased Premises. (b) Except as provided in Section 14 hereof, the Lessor represents that to the best of its actual knowledge, the Leased Premises are free from any violations of law or regulations pertaining to occupational hazards and environmental conditions or Hazardous Materials as defined in Section 31 of this Lease. In the event that any hazardous environmental conditions exist on the Leased Premises as of the LeaseCommencement Date which result in a loss to Lessee and which were caused by Lessor, the United States Air Force or parties or entities within the control of, or under contract with Lessor, then the Lessor shall indemnify, defend and hold Lessee harmless from any costs, expenses, attorney fees or liabilities relating to any claims of such violations or conditions existing prior to Lessee’s occupancy of the Leased Premises. Lessor shall indemnify Lessee from hazardous environmental conditions or violations caused directly by the Lessor, its employees, agents, or licensees during or subsequent to the Term of this Lease. (c) Lessee shall be solely responsible for obtaining at its cost and expense; any environmental permits required for its operation under this Lease independent of any existing permits. 31. Compliance with Environmental Laws. (a) The words and phrases set forth below shall have the following definitions:I. “Hazardous Materials” means and includes any material that because of its quality, concentration or physical or chemical characteristics, poses a significant present or potential hazard to human health and safety or to the environment SCLAA Standard Lease Page 16 ComAv Buildings 553 & 739
if released into the workplace or the environment. Hazardous Materials include hazardous wastes, toxic substances, petroleum products and motor fuels and similar substances and materials, including all substances and materials defined as hazardous or toxic substances or materials under California Health and Safety Code section 25501(n) or any other similarly applicable state, federal or local law. II. “Environmental Laws” means and includes the various health and safety laws and regulations of state, federal and local agencies pertaining to the manufacture, use, storage, disposal, release, and reporting relating to Hazardous Materials.(b) As of the Lease Commencement Date, Lessee shall not cause or permit any Hazardous Materials to be used, generated, manufactured, produced, stored, brought upon, or released, on, under or about the Leased Premises, or transported to and from the Leased Premises, by Lessee, its agents, employees, contractors, or invitees in violation of any Environmental Laws. Lessee shall indemnify, defend and hold harmless the Lessor from any damage, cost, expense, liability, fine, or penalty resulting from any unauthorized discharge, emission, spill, storage, release, disposal or use of any Hazardous Materials by Lessee, its officers, agents, employees, contractors or invitees or any of them. This obligation of Lessee shall survive the Expiration Date or earlier termination of this Lease and shall apply whenever the Lessor incurs cost or liability arising from any use or activity of Lessee relating to Hazardous Materials during the Term or any extension thereof. (c) Without limiting the foregoing, if at any time during the Term of this Lease or any extension thereof, the presence of any Hazardous Materials on, under or about the Leased Premises caused by Lessee, its agents, employees, contractors, or invitees results in an unpermitted, unscheduled or unauthorized release or contamination of the Leased Premises by such Hazardous Materials, then Lessee shall at its sole cost and expense promptly take all actions necessary to return the Leased Premises to the condition existing prior to the unpermitted, unscheduled or unauthorized release of any such Hazardous Materials on the Leased Premises. (d) Lessee shall immediately notify the Lessor of the occurrence of any of the following events: (1) receipt by Lessee of any correspondence or communication from any governmental entity regarding the application of Environmental Laws to the Leased Premises or the investigation or enforcement by such governmental entity of any such Environmental Laws in connection with Lessee’s occupancy or use of the Leased Premises, and (2) unpermitted, unscheduled or unauthorized release of any Hazardous Materials on the Leased Premises which may occur at any time during the Term of the Lease or any extension thereof. (e) To the extent Lessee may conduct any use or activity on the Leased Premises which includes the use, handling, transport, or disposal of any Hazardous Material in quantities which exceed the threshold amounts authorized under California Health and Safety Code section 25507, Lessee shall, at its sole cost and expense, SCLAA Standard Lease Page 17 ComAv Buildings 553 & 739
prepare and submit to the City of Victorville (or designated local Certified Unified Program Agency “CUPA”) for approval, renewal or amendment, as applicable, a Business Plan for the Leased Premises, as the term “Business Plan” is described under California Health and Safety Code section 25505. (f) Notwithstanding any of the foregoing, in the event Lessee, its agents, employees, contractors, or invitees, fails to use and maintain the Leased Premises in accordance with the provisions of this Section 31, Lessor and/or the City of Victorville (the “City”) shall have the right, but not the obligation, to enter the Leased Premises and undertake remedial action as necessary in order to ensure that the Leased Premises are in compliance with all Environmental Laws. In such event, Lessee shall reimburse Lessorand/or the City for all reasonable sums incurred by it for such remediation activities. In such event Lessor may, in its sole discretion, and not limiting its ability to recover through any other means provided in law or equity, determine to deduct all or a part of such sums due under this Section from the Security Deposit. 32. Surrender of Leased Premises. On the Expiration Date of this Lease, Lessee shall surrender and deliver possession of the Leased Premises to the Lessorclean and free of debris and in as good condition as it was on the Lease Commencement Date, reasonable wear and tear excepted.33. Compliance with Laws. Lessee shall comply with all applicable federal, state and local laws, regulations and standards that are or may become applicable to Lessee’s activities on the Leased Premises (hereinafter collectively, (“Laws”), includingwithout limitation the SCLA and FAA Rules and Regulations). Lessee agrees to abide by and conform to the SCLA Rules and Regulations, as such may be amended from time to time by Lessor, and to cause its officers, agents, employees, suppliers, shippers, customers, and invitees to so abide and conform. The Lessor shall have the right, from time to time, to modify, amend and enforce said rules and regulations. In addition, Lessee agrees to abide by the Selected FAA Rules and Regulations attached hereto as Exhibit C and incorporated herein by this reference, as such may be amended from time to time, and to cause its officers, agents, employees, suppliers, shippers, customers, and invitees to so abide and conform. The Lessor shall not be responsible to Lessee for the noncompliance with said rules by other tenants, their officers, agents, employees, suppliers, shippers, customers and/or invitees. The judgment of any court of competent jurisdiction, or the admission of Lessee in a proceeding brought against Lessee by any government entity, that Lessee has violated any such Laws (except where such admission may be the basis for settlement) shall be conclusive as between the Lessor and Lessee and shall constitute grounds for declaration of default, breach, forfeiture, and termination of this Lease by the Lessor. 34. Defaults. (a) In the event Lessee should default in the performance of any covenant or condition of this Lease (excluding the payment of any monthly rent or other amounts due hereunder) and such default is not cured or removed within thirty (30) days SCLAA Standard Lease Page 18 ComAv Buildings 553 & 739
after service of written notice upon Lessee of such default in the performance of any covenants and conditions; then in such event, the Lessor shall have the right and option to terminate this Lease, to re-enter the Leased Premises, to evict Lessee and to remove Lessee’s possessions, all without being deemed guilty of any trespass, and without prejudice to any claim for arrears of rent or breach of covenant. Notwithstanding the foregoing, if Lessee, prior to the expiration of such thirty (30) day period for default diligently commences to cure such default but is unable to do so within the thirty (30) day period, then such period shall be extended for an additional thirty (30) days provided Lessee continues to make a diligent effort to cure the default. (b) Failure to pay Monthly Base Rent or any other amounts when due shall be deemed a default under this provision. Lessee shall cure such default within ten (10) days after service of written notice. (c) Any statutory notice required as part of any eviction action or similar type of proceeding may be included with any notice of default given pursuant to this Section and the Lessor need not declare a default and have such default remain uncured prior to delivery of such statutory notice. 35. Remedies of the Lessor. In the event of any breach of the Lease by Lesseeand the cure periods described in Section 34 hereof have expired, the Lessor may at any time thereafter, with or without notice or demand and without limiting the Lessor in the exercise of any other right or remedy which the Lessor may have by reason of such breach, do any of the following:(a) terminate Lessee’s right to possession of the Leased Premises by any lawful means, in which case this Lease shall terminate, and Lessee shall surrender possession of the Leased Premises to the Lessor. This may involve the Lessor filing an unlawful detainer action and receiving a court order for Lessee to vacate the premises. In any such event, the Lessor shall be entitled to recover from Lessee all damages incurred by the Lessor by reason of Lessee’s default, including, but not limited to the cost of repairing or restoring damages to the Leased Premises caused by Lessee, the cost or removal of Lessee’s improvements, fixtures and other contents of the Leased Premises, costs associated with past or future brokerage commissions and marketing expenses and the other costs payable by the Lessor in connection with the recovery of possession of the Leased Premises, including but not limited to reasonable attorneys’ fees and court costs, as well as: (1) the worth at the time of award by the court having jurisdiction thereof of the unpaid rent which had been earned at the time of termination, and (2) the worth at the time of award by the court having jurisdiction thereof of the amount by which the unpaid rent for the balance of the Term after the time of such award may exceed the amount of such rental loss for the same period that Lessee proves could be reasonably avoided; or (b) pursue any other remedy now or hereafter available to the Lessorunder the laws or judicial decisions of the State of California.

SCLAA Standard Lease Page 19 ComAv Buildings 553 & 739

36. Default by the Lessor. In the event Lessor should default in the performance of any covenant or condition of this Lease and such default is not cured or removed within thirty (30) days after service of written notice of default upon Lessor, then in any such event, Lessee shall have the right and option to terminate this Lease. If Lessor, prior to the expiration of such thirty (30) day period for a default, diligently commences to cure such default, but is unable to do so within the thirty (30) day period, then such period shall be extended for an additional thirty (30) days provided Lessor continues to make a diligent effort to cure the default. In event of uncured default Lessee shall have all remedies available at law or in equity for any default or breach of this Lease by the Lessor.

37. Force Majeure-Unavoidable Delays. If the performance of any act required by this Lease to be performed by either Party is prevented or delayed by reason of an act of God, strike, lockout, labor troubles, inability to secure materials, unreasonably restrictive governmental laws or regulations, or any other cause except financial inability that is not the fault of the Party required to perform the act, the time for performance of the act will be extended for a period equivalent to the period of delay, and performance of the act during the period of delay will be excused. However, nothing contained in this Section shall excuse the prompt payment of rent by Lessee as required by this Lease or the performance of any act rendered difficult solely because of the financial condition of the Party required to perform the act.

38. Notices. Any and all notices or demands required or permitted to be given hereunder must be personally delivered or be mailed by registered or certified mail, return receipt requested, addressed as follows:

To the Lessor: Southern California Logistics Airport Authority 18374 Phantom West
Victorville CA 92394
Attn: Airport Director
With copies to: Green de Bortnowsky, LLP
30077 Agoura Court, Suite 210
Agoura Hills CA 91301
Attn: Andre de Bortnowsky, Esq.

To Lessee: ComAv Technical Services, LLC
18438 Readiness Street
Victorville CA 92394
Attn: Craig Garrick, Chief Executive Officer
or at such other address or addresses that either Party may hereafter designate in writing to the other. Any notice or demand which is mailed by registered or certified mail as provided above shall be deemed to be effective and given for all purposes three (3) business days following the time of deposit thereof, postage prepaid, in the United States mail.

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39. Miscellaneous.(a) One or more waivers of any provision of this Lease by the Lessorshall not be construed as a waiver of a subsequent breach of the same provision and the Lessor’s consent or approval shall not be deemed to waive or render unnecessary the Lessor’s consent or approval to or of any subsequent or similar act by Lessee. (b) If either Party to this Lease shall bring any action for any relief against the other, declaratory or otherwise, to enforce the terms hereof or to declare rights here under (collectively, an Action), the losing Party shall pay to the prevailing Party attorneys’ fees and costs incurred in bringing and prosecuting such Action and/or enforcing any judgment, order, ruling, or award (collectively, a Decision) granted therein, all of which shall be deemed to have accrued on the commencement of such Action and shall be paid whether such Action is prosecuted to a Decision. Any Decision entered in such Action shall contain a specific provision providing for the recovery of attorneys’ fees and costs incurred in enforcing such Decision. The court may fix the amount of reasonable attorneys’ fees and costs on the request of either Party. For the purposes of this paragraph, attorneys’ fees shall include, without limitation, fees incurred in the following: (1) post-judgment motions and collection actions; (2) contempt proceedings; (3) garnishment, levy, and debtor and third party examinations; (4) discovery; and (5) bankruptcy litigation. “Prevailing Party” within the meaning of this paragraph includes, without limitation, a Party who agrees to dismiss an Action upon the other Party’s payment of the sums allegedly due or performance of the covenants allegedly breached, or who obtains substantially the relief sought by it. Nothing contained in the Section shall be interpreted to mean that Lessor has agreed to arbitrate any dispute which may arise hereunder. (c) This Lease can be modified, supplemented, amended, or rescinded only by a writing expressly referring to this Lease and signed by Lessor and Lessee. (d) If any provision of this Lease or any application thereof shall be invalid or unenforceable, the remainder of this Lease and any other application of such provision shall not be affected thereby. Unless otherwise expressly provided herein, any approval or consent of Lessor required hereunder shall not be unreasonably withheld or delayed. This Lease shall be binding upon and inure to the benefit of and be enforceable by the respective successors of the Parties hereto. The Section headings in the Lease are for purposes of reference only and shall not limit or define the meaning hereof. (e) This Lease contains the entire understanding and agreement of the Parties, supersedes all prior understandings and agreements, and cannot be changed orally. This Lease shall be construed in accordance with the laws of the State of California. Time is of the essence. (f) Any conflict between the printed provisions, exhibits, or addenda of this Lease and the typewritten or handwritten provisions, if any, shall be controlled by the typewritten or handwritten provisions provided such typewritten or handwritten provisions are initialed by both Parties.

SCLAA Standard Lease Page 21 ComAv Buildings 553 & 739
(g) This Lease shall be of no force and effect unless executed by both Parties. Each person executing this Lease for the respective Parties expressly represents and warrants that he or she has the authority to enter into Leases on behalf of and bind the entity on whose behalf this Lease is executed. (h) This Lease may be executed by the Parties in counterparts, and when executed by each of the Parties, each counterpart shall be deemed to be a part of the same instrument. [END OF THIS PAGE – SIGNATURES FOLLOW] SCLAA Standard Lease Page 22 ComAv Buildings 553 & 739
IN WITNESS WHEREOF, the Parties have executed this Lease Agreement as of the dates set forth below.LESSEE: COMAV TECHNICAL SERVICES, LLC ______________________________ _____________ Craig Garrick Date Chief Executive Officer LESSOR: SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY (SCLAA) ______________________________ _____________ C. Eric Ray Date Airport Director ATTEST: ______________________________ _____________ Jennifer Thompson Date SCLAA Secretary APPROVED AS TO STANDARD FORM: ______________________________ _____________ Andre de Bortnowsky Date SCLAA Legal Counsel RISK MANAGER ______________________________ _____________ Lee Brown Date

SCLAA Standard Lease ComAv Buildings 553 & 739
EXHIBIT ADESCRIPTION OF LEASED PREMISES Building 553 comprised of approximately Twenty-Two Thousand Two Hundred Fifty-Eight (22,258) square feet of office and warehouse space and approximately Seventy-One Thousand Two Hundred Ninety-One (71,291) square feet of fenced yard space as depicted on Exhibit A-1 and Exhibit A-2 located at 13123 Aerospace Drive, Victorville California 92394, and Building 739 comprised of approximately Twelve Thousand Five Hundred Eleven (12,511) square feet of office, storage and warehouse space located at 18676 Phantom West, Victorville California 92394, as depicted on Exhibit A-3 and Exhibit A-4, together with the improvements thereon.

SCLAA Standard Lease ComAv Buildings 553 & 739

EXHIBIT B SCLA RULES AND REGULATIONS
Southern California Logistics Airport Rules and Regulations AmendedApril 17, 2007
Pg.1 of 38

must be approved

each

lease with the Airport Authority of a ground site lease with the Airport Authority, or an approved sublease, of a building, The Non-Signatory Landing Fee is intended to compensate the Airport Authority for the operator’s use of the Airport’s runway and taxiway areas as well as compensation for the privilege of being able to access the airport to conduct business. each

storage feeflowage feeflowage feesstorage feesstorage feestoragemodified flowage fee

Flowage fee -$ .08 per gal; Storage fee -$ .02 per gallon) (Fees are subject to change)

SCLAA Standard Lease ComAv Buildings 553 & 739

EXHIBIT CSELECTED FAA RULES AND REGULATIONS

SCLAA Standard Lease ComAv Buildings 553 & 739
EXHIBIT DUSE AND CONDITION OF LEASED PREMISES The use of the Leased premises shall include functions related to the consolidation, inspection, repair, storage, and disposal of aircraft parts and components that are incidental to Lessee’s aircraft storage, maintenance, and repair operations of commercial aircraft. Work conducted inside the Leased Premises shall be that type of work that is typical of back shop operations coincidental to final disposal of aircraft parts and components. The condition of the Leased Premises shall be established resulting from a walk-through inspection attended by both Lessor and Lessee prior to the date Lessee takes occupancy. The findings of this walk-through inspection shall be memorialized at the time of the walk-through via the SCLA Property Lease Checklist.

SCLAA Standard Lease ComAv Buildings 553 & 739
EXHIBIT E TENANT IMPROVEMENTS Subject to the terms and conditions of this Lease, Lessor and Lessee hereby affirm and acknowledge that the following items of work shall represent the Tenant Improvements contemplated for Building 553 and 739 within this Lease. Location Description NotesBuilding 553 Electrical Repairs As NeededWhere Needed Building 553 Door Repairs As NeededWhere Needed Building553 Fence Privacy Slats As depicted on Exhibit E-1 in green Along South, East and North Side of FenceBuilding 553 Removal of Overhead Electrical Bus Bars Bay 2Building 553 Roofing Repair As NeededWhere Needed Building 553 Replace Roof Hatch Existing LocationBuilding 553 New Gate as depicted on Exhibit E-1in blue Existing Location Building 553 Gravel Infill to Cover 44,000 sq ft of Premises (approximately 408 cubic yards) as depicted on Exhibit E-1in yellow Yard Space Building 739Install New 20’ x 16’ Roll Up Dooras depicted on Plans on Exhibit E-2South East Wall & Procure PermitsBuilding 553 Building 739 Remove Existing Lighting and Replace with LED FixturesThroughout As Needed

Exhibit E-2+/- 12,511 Total Square Feet
Replace Existing 15' WideRoll Up Door with New20' Wide x 16' Tall Door SCLAA Standard Lease ComAv Buildings 553 & 739

EXHIBIT F TENANT IMPROVEMENT CERTIFICATION
SCLAA Standard Lease ComAv Buildings 553 & 739

Item Number: 17
City Council / Board of Directors
Written Communications
Meeting of: February 20, 2024
Submitted By:

C. Eric Ray, Airport Director

Subject:

Standard Sublease Agreement for Building 720, Suite 102 by and between the Southern California Logistics Airport Authority and ComAv Technical Services, LLC.

Recommendation:

That the Southern California Logistics Airport Authority (“SCLAA”) Board of Directors:
(1) approve entering into a Standard Sublease Agreement for Building 720, Suite 102 (“Agreement”), by and between the SCLAA and ComAv Technical Services, LLC, (“ComAv”); and
(2) authorize the Airport Director to execute said Agreement.

Fiscal Impact:

The Agreement presented herein will generate approximately $440,179 in gross lease revenue over the initial term (March 1, 2024 – December 31, 2026). The table below outlines the fiscal impact of the Agreement.

FY 2023-2024
(March – June)
FY 2024-2025 FY 2025-2026 FY 2026-2027
(July –December)
$50,089.32 $151,699.28 $157,879.96 $80,511.19
A budget has been established in the current fiscal year 2023-2024 for the resulting revenue, therefore, no additional revenue appropriation is required with this action.

Future appropriations for the subject Agreement will be considered at the time the annual budget is approved.

Strategic Plan Goal:

The City of Victorville Strategic Plan 2023-2026 identifies multi-year strategic goals and various strategies to work toward achieving those goals. Goal A fosters fiscal health 5 7
0 through disciplined long-term planning, cost control, increased revenues, and cost recovery.

Background:

ComAv has been a major tenant at the Southern California Logistics Airport (“SCLA”) for over twenty years, offering fully integrated aircraft asset management service to a vast array of aircraft owners and operators. As a fully certified commercial aircraft maintenance provider, ComAv performs maintenance inspections, repairs and modifications on Boeing and Airbus commercial jetliners, as well as asset management and engine services. ComAv provides both active and inactive aircraft storage, with over 200 aircraft currently in its custody. ComAv’s involvement in the end-of-lifecycle business entails divisions specializing in the aircraft parts and recycling sectors, including management of an engine pool in excess of 150 engines.

With over 250 employees, ComAv is the largest employer at the SCLA. Since executing their first lease agreement in 1998, ComAv has grown to its current leasehold estate that includes nine SCLA owned buildings and a significant ground leasehold interest.

Discussion:

ComAv has requested the renewal the sublease agreement for office space in Building 720, Suite 102 to perform administrative duties related to the management of stored aircraft, inspection, and re-activation services. The proposed Agreement for Building 720, Suite 102 entails an initial term of three years with a commencement date of March 1, 2024. The Sublease Agreement also contemplates one, three-month, option term. The Agreement consists of Building 720, Suite 102 which comprised of approximately 13,115 square feet of office space. ComAv has agreed to pay $12,523 per month with an annual 3% inflator. This amounts to $.95 cents per square foot per month for office space which is commensurate with similar SCLA buildings.

Because the Sublease Agreement accommodates the immediate needs of an important tenant, maintains local employment, and generates revenue for the Southern California Logistics Airport, staff recommends that Your Honorable Southern California Logistics Airport Authority Board approve the Sublease Agreement with ComAv Technical Services, LLC, for Building 720, Suite 102, and authorize the Airport Director to execute said agreement.

Staff remains available for any questions you may have.

CER/lf
Attachments: A. General Site Map
B. Standard Sublease Agreement for Building 720, Suite 102 Ù
Attachment A
Bldg 720
Suite 100 Suite 101 Suite 102 Vehicle
Parking
Readiness Street
Bldg 720Bldg 720

ATTACHMENT B

STANDARD LEASE

AGREEMENT FOR
BUILDING 720, SUITE 102

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

STANDARD SUBLEASE AGREEMENT
BUILDING 720 SUITE 102
This Sublease Agreement (the “Sublease”) is made this _________ day of _____________, 2024, by and between the SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY (“SCLAA”), a California joint powers authority, (hereinafter referred to as “Sublessor”) and COMAV TECHNICAL SERVICES, LLC, (“ComAv”), a California Limited Liability company (hereinafter referred to as “Sublessee”). Sublessor and Sublessee are sometimes referred to hereinafter individually as a “Party” and collectively as the “Parties.”

RECITALS
These Recitals are included to assist in interpreting this Sublease and to understand the basis upon which certain terms and conditions have been included. It is not intended, nor should it be construed, to supersede or amend the specific terms and conditions of this Sublease.

A. The United States Air Force (“Air Force”) and the Victor Valley Economic Development Authority (“the Authority”) have previously entered into certain Department of the Air Force Leases pertaining to portions of former George Air Force Base, which is now known as the Southern California Logistics Airport (“SCLA”) (hereinafter the “Air Force Leases”).

B. The Authority has delegated its decision-making authority with respect to the SCLA to the Sublessor, who now has the authority to enter into transactions on behalf of the Authority.

C. The Air Force (“Grantor”) and the SCLAA (“Grantee”) have entered into certain Air Force Quitclaim Deed(s) (“Quitclaim Deed(s)”), which release and forever quitclaim to the Grantee all the real property described in such Quitclaim Deed(s), subject to the Covenants, Conditions and Restrictions set forth in the Quitclaim Deed(s).

D. Sublessee seeks to sublease from the Sublessor a portion of the property subject to the Air Force Leases (hereinafter the “Subleased Premises”).

E. Although many portions of the SCLA are subject to and governed by the Air Force Leases, some portions (which may include appurtenances, access/use rights, privileges and/or easements associated with the Subleased Premises) have been transferred from the Air Force to Sublessor by means of various deeds (hereinafter the “Airport Deeds”) and are subject to the provisions and conditions of such Airport Deeds.

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F. Sublessor and Sublessee have previously entered into a certain Sublease Agreement dated November 1, 2021, (the “Original Sublease”) pertaining to the sublease of property at the SCLA. The Original Sublease contained one (1) additional one (1) year option term to renew which was exercised and expired on October 31, 2023. Lessor granted Sublessee permission to enter into a holdover period to allow Sublessee more time to finalize the Tenant Improvement scope of work. The holdover period will expire on February 29, 2024.

TERMS AND CONDITIONS

1. Subleased Premises. Subject to the terms and conditions herein contained, Sublessor hereby subleases to Sublessee, and Sublessee hereby subleases from Sublessor certain property which is part of the SCLA, described as follows (the “Subleased Premises”):
a. A portion of that certain real property designated as Building 720, Suite 102, comprised of approximately Thirteen Thousand One Hundred Fifteen (13,115). square feet of office space, together with the improvements thereon, located at the SCLA at 18708 Readiness Street, Victorville, CA 92394, as depicted on Exhibit A, attached hereto and incorporated herein by this reference; and b. all appurtenances, rights, privileges and easements in any way applicable thereto.

2. Term. The Initial Term of this Sublease shall be for a period of approximately three (3) years, commencing on March 1, 2024, (the “Sublease Commencement Date”) and expiring on December 31, 2026, (the “Sublease Expiration Date”) unless sooner terminated or extended as hereinafter provided. To the extent any of the leases or subleases referenced in Recital A hereof are terminated, and such lease or sublease governs this Sublease, then this Sublease shall also terminate, as of the date of termination of the applicable governing lease or sublease.

3. Option to Extend Term. Upon expiration of the Initial Term, Sublessee shall have the option to renew this Sublease for one (1) additional three (3) month term (the “Option Term”), provided that: (i) Sublessee is in good standing and otherwise in full compliance with all of the terms and conditions of this Sublease; (ii) Sublessee provides Sublessor written notice of its desire to renew no later than one hundred eighty (180) days prior to the expiration of the Term; and (iii) Sublessor confirms in writing Sublessee’s Option Term. Upon confirmation of such exercise by Sublessor, all references to the Expiration Date shall mean March 31, 2027.

4. Termination. This Sublease shall only terminate prior to the Expiration Date for such reasons as are specifically set forth in the provisions of this Sublease.

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5. Right to Terminate for Development. With respect to any building or facility comprising the Subleased Premises (including any additional access or rights of use specified in this Sublease) which Sublessee occupies pursuant to this Sublease, after Sublessee’s execution of this Sublease, Sublessor shall have the right, upon giving Sublessee ninety (90) days’ notice in writing, to terminate this Sublease. Such right shall only be exercised in good faith to the extent Sublessor requires the current space for the development of the SCLA.

6. Rent.
a. Monthly Base Rent. During the first year of the Initial Term, Sublessee shall pay to Sublessor as rent for the Subleased Premises the amount of Twelve Thousand Five Hundred Twenty-Three Dollars ($12,523) per month (the “Monthly Base Rent”). Commencing on November 1, 2024, the Monthly Base Rent shall be increased by three percent (3%), and on each annual anniversary of the this date thereafter during the Term (or during any Option Term exercised in accordance with the provisions of Section 3 hereof), the then-current Monthly Base Rent shall be increased by an additional three percent (3%). All further references to the Monthly Base Rent shall mean and include any such increased amount as calculated under the provisions of this paragraph.
b. Tenant Improvements. Within two hundred forty (245) days of the Sublease Commencement Date, Sublessee shall undertake and substantially complete, at its sole expense, certain tenant improvements to the Subleased Premises (the “Tenant Improvements”) as further described in Exhibit E attached hereto and incorporated herein by this reference. Sublessee shall construct the Tenant Improvements in accordance with Section 14, 17 and 22 of this Sublease, using its own staff and/or properly licensed and insured contractors and in full compliance with any applicable prevailing wage or public bidding requirements. c. Rent Credits. As consideration for substantially completing the Tenant Improvements within the time period set forth above, and subject to the provisions of subsections i and ii hereof, Sublessor shall, commencing on December 1, 2024, and continuing for six (6) consecutive months of the Initial Term of this Sublease, provide Sublessee with a monthly rental credit in an amount equal to Seventy-Five percent (75%) of the anticipated cost of One Hundred Thousand Dollars ($100,000) for the tenant improvements to Building 720, Suite 102. The rental credit shall be based upon actual costs incurred by Sublessee to construct the Tenant Improvements, as verified and approved by Sublessor pursuant to subsection (i) below. The rental credit shall not exceed a total of Seventy-Five Thousand Dollars ($75,000) and shall be applied on a monthly basis toward the Sublessee’s Monthly Base Rent in an amount not to exceed Twelve Thousand Five Hundred Dollars ($12,500) monthly. i. Following the substantial completion of the Tenant Improvements, Sublessee shall provide to Sublessor all invoices with proof of payment, Tenant Improvement Certifications, as further described in Exhibit F, and other evidence of SCLAA Standard Sublease Page 3 ComAv Bldg 720, Ste 102

actual cost incurred together with a cost summary cover page (the “Close-Out Statement”). Upon receipt of the Close-Out Statement, Sublessor shall verify same and calculate the actual total amount of the rent credits due to Sublessee. ii. Should Sublessee not substantially complete the Tenant Improvements within two hundred forty-five (245) days following the Sublease Commencement Date (October 31, 2024), and provide a Close-Out Statement to Sublessor documenting the actual costs incurred, Sublessee shall not be eligible for rent credits described in Section 6.c.
d. Payment. Monthly Base Rent shall be payable in advance prior to the first (1st) day of each calendar month and without demand to:

Southern California Logistics Airport Authority
Attention: Airport Director
18374 Phantom West
Victorville, California 92394
or at such other place as Sublessor may designate in writing from time to time.

Sublessee shall make its payments using the following information, or such other information as Sublessor may from time to time designate for this purpose:

Sublessor’s Fed. Tax I.D. #:

Contact Person:

Phone Number:
95-2235918
C. Eric Ray, Airport Director
(760) 243-1900

7. Security Deposit. Sublessee shall deposit with the Sublessor upon execution hereof Twelve Thousand Five Hundred Twenty-Three Dollars ($12,523), which includes Eleven Thousand Eight Hundred Three Dollars and Fifty Cents ($11,803.50) already on deposit with Sublessor, as security for Sublessee’s faithful performance of Sublessee’s obligations hereunder (the “Security Deposit”). If Sublessee fails to pay rent or other charges due hereunder, fails to pay any utility or service provider, or otherwise defaults with respect to any provision of this Sublease, the Sublessor may use, apply or retain all or any portion of said deposit for payment of any rent or other charges in default or for the payment of any other sum to which the Sublessor may become obligated by reason of Sublessee’s default, or to compensate the Sublessor for any loss or damage which the Sublessor may suffer thereby. The Security Deposit amount must be maintained by Sublessor in the minimum amount of the Security Deposit required under this Section.

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8. Brokerage Commission. Sublessor and Sublessee represent and affirm to each other that they have not had any dealings with any real estate brokers, finders or agents and no commissions or fees are payable by either Party in connection with this Sublease.

9. Late Charge. Sublessee hereby acknowledges that late payment by Sublessee to Sublessor of any installment of rent, or any other sums due hereunder will cause Sublessor to incur costs not contemplated by the Sublease, the exact amount of which will be extremely difficult to ascertain. Accordingly, if any installment of rent, or any other sum due from Sublessee is not received by the Sublessor within ten (10) days after such amount is due, whether or not any notice of default or other notice has been given, Sublessee shall pay to the Sublessor a charge equal to six percent (6%) of the amount past due (the “Late Charge”), in addition to the payment of the past due rent itself. The Parties hereby agree that such Late Charge represents a fair and reasonable estimate of the costs the Sublessor will incur by reason of late payment by Sublessee, and no more than one (1) Late Charge shall be assessed per month. Notwithstanding the foregoing, in the event the Sublessee elects to make annual payments in advance, then no Late Charge shall apply.

10. Limited Right to Possession of the Subleased Premises. Sublessor shall deliver possession of the Subleased Premises to Sublessee on or before the Sublease Commencement Date, free and clear of all tenants, occupants, and right of any third parties except as hereafter provided in this Section 10. Sublessee agrees that the terms of its possession shall be subject to any outstanding easements and rights-of-way not within the control of the Sublessor and further to the right of entry by the United States Air Force as provided under the Air Force Leases. The Sublessor shall use best efforts to ensure the quiet use and enjoyment of the Subleased Premises by Sublessee.

However, unreasonable interference by Sublessor or the Air Force with Sublessee’s quiet enjoyment of the Subleased Premises that results in material and demonstrable financial detriment to Sublessee and Sublessee being unable to continue its business functions in a commercially reasonable manner, shall be grounds for termination of the Sublease by Sublessee.

11. Holding Over. In the event Sublessee, with the Sublessor’s prior written consent, holds over and continues in possession of the Subleased Premises, or any part thereof, after the Expiration Date of this Sublease, such occupancy shall be considered a month-to-month tenancy subject to all the terms and conditions of this Sublease in effect on the day immediately preceding the Expiration Date, except that the Monthly Base Rent for any such holdover period shall be increased to one hundred fifty percent (150%) of the then current Monthly Base Rent. If Sublessee, without the Sublessor’s prior written consent, holds over or continues in possession of the Subleased Premises, or any part thereof, after the Sublease Expiration Date of this Sublease, such occupancy shall be deemed a tenancy at sufferance, permitting the Sublessor to immediately commence eviction proceedings without notice to Sublessee.

SCLAA Standard Sublease Page 5 ComAv Bldg 720, Ste 102

12. Right to Relocate. With respect to any building which Sublessee occupies pursuant to this Sublease, after Sublessee’s execution of this Sublease, Sublessor, to the extent required by the SCLAA, shall have the right, upon giving Sublessee ninety (90) days notice in writing, to provide and furnish Sublessee with space elsewhere in such other building within the boundaries of the SCLA of approximately the same size and with similar characteristics and amenities (such as access to streets and runways) as the Subleased Premises, and to place Sublessee in such new building space at the Sublessor’s expense. Such right shall only be exercised in good faith to the extent the Sublessor requires the current space for the development of the SCLA. In the event Sublessor moves Sublessee to said new space within any building then this Sublease with respect to the original Subleased Premises and each and all of the terms and covenants and conditions thereof shall thereupon remain in full force and effect and be deemed applicable to such new space. If the space in the building is smaller in size than the existing Subleased Premises, then Sublessor shall receive a reduction in rent equal to the difference between the size (using interior square footage) of the existing Subleased Premises and the size of the new building. However, Sublessee shall not be assessed additional rent if the new space is larger in size than Sublessee’s then existing Subleased Premises, unless the new building exceeds the size of the existing Subleased Premises by more than fifteen percent (15%). Sublessee reserves the right to reject relocation to a specific location which does not comply with the terms of this provision.

13. Maintenance. Except for excessive repair and maintenance necessitated solely by Sublessor’s activities, Sublessee shall at all times during the Term hereof and until surrender and Expiration, keep and maintain the Subleased Premises in good and substantial order and repair, and shall undertake all necessary repair and maintenance of the Subleased Premises. Sublessee shall be responsible for all operating expenses associated with maintaining the Subleased Premises including, but not limited to:
cleaning; light bulb replacement; procurement of supplies and materials; preventative maintenance; repair; signs; sidewalks; all monthly, quarterly, and annual inspection/servicing and repair of the Subleased Premises mechanical, electrical, lighting, plumbing, and life safety systems; furniture and window cleaning; servicing of fire extinguishers; repairs to trade fixtures and/or equipment, doors, ceilings, roofing, floors; exterior painting, resurfacing paved exterior areas and the like; landscaping of parking lot, associated fees, etc. Sublessee agrees at Sublessee’s sole cost and expense to procure, maintain throughout the Term, and supply copies to Sublessor, contracts for the inspection/servicing and maintenance of HVAC equipment, fire extinguishing, fire alarms and/or smoke detection systems, and air compressor systems. Sublessee also agrees throughout the Term to supply copies of all life safety related certifications and/or inspection records to the Sublessor in a timely manner.

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14. Use and Condition of Subleased Premises. The Subleased Premises are to be used by Sublessee for those purposes more particularly provided for in Exhibit D, attached hereto and incorporated herein by this reference, and for no other purpose unless expressly agreed to by the Sublessor in writing. Sublessee agrees to use the Subleased Premises in such a manner as to not interfere with the Sublessor’s rights in the Subleased Premises or the surrounding areas, to comply with all airport rules and regulations, all applicable governmental laws, ordinances, and regulations in connection with its use of the Subleased Premises, to keep the Subleased Premises in a clean and sanitary condition, and to use all reasonable precaution to prevent damage, or injury to the Subleased Premises.
a. Permits. Sublessee, at its sole cost and expense, shall apply for and obtain any and all permits and/or certifications required by any federal, state or local governmental entity, including but not limited to the Mojave Desert Air Quality Board, in connection with the painting, maintenance and/or overhaul of aircraft in or about the Subleased Premises. Such permits shall include, but not be limited to, any which may be required for the air handling and ventilation requirements for the Subleased Premises. Furthermore, Sublessee shall coordinate and cooperate with the Mojave Desert Air Quality Board as may be required from time to time. Any and all such permits and/or certifications shall be obtained in such a manner so as to run in favor of the Subleased Premises and/or the Sublessor, and such permits or certifications shall remain with the Subleased Premises upon the expiration or termination of the Sublease.
b. No Warranties. Except as provided herein, Sublessee agrees that no promises, covenants, representations, statements, or warranties have been made on behalf of the Sublessor to Sublessee respecting the condition of the Subleased Premises, or the manner of operating the Subleased Premises or the maintaining of any repairs to the Subleased Premises.
c. Acceptance of Subleased Premises. Sublessee acknowledges that it has satisfied itself by its own independent investigation that the Subleased Premises are suitable for their intended use, and that neither the Sublessor nor the Sublessor’s agent or agents have made any representation or warranty as to the present or future suitability of the Subleased Premises for the conduct of Sublessee’s business.

Sublessee’s taking possession or use of the Subleased Premises for any purpose shall constitute Sublessee’s acceptance of the Subleased Premises “as-is” in its existing condition.
d. Notice of Presence of Asbestos and Lead-Based Paint. Sublessee, its successors and assigns are warned that the Subleased Premises may contain asbestos materials and lead-based paint materials. No warranties, either expressed or implied, are given with regard to the quantity, location or condition of the asbestos containing materials or the lead-based paint materials. Sublessee, its successors and assigns, shall be deemed to have relied solely on their own judgment in assessing the overall condition of all or any portion of the Subleased Premises, including any asbestos SCLAA Standard Sublease Page 7 ComAv Bldg 720, Ste 102

hazards or lead-based paint hazards or concerns. Sublessee acknowledges that Sublessee was given every opportunity to inspect the Subleased Premises to assess the risk, if any, from asbestos containing material or lead-based paint materials. e. No Liability Assumed by Sublessor. The Sublessor assumes no liability for damages for personal injury, illness, disability or death to Sublessee or to Sublessee’s successors, assigns, employees, invitees, or any other persons subject to Sublessee’s control or direction, or to any person, including members of the general public arising from or incident to the purchase, transportation, removal, handling, use, disposition or any activity causing or leading to contact of any kind whatsoever with asbestos or lead-based paint on the Subleased Premises which is the subject of this Sublease, whether Sublessee, its successors or assigns has or have properly warned or failed to properly warn the individuals injured. Sublessee, its successors and assigns, further agree that in its use and occupancy of the Subleased Premises, it will comply with all federal, state and local laws relating to asbestos and lead-based paint. f. Personal Property. Sublessee shall, at the Sublease Expiration Date or such other termination of this Sublease, by lapse of time or otherwise, remove all of Sublessee’s personal property, repair any damage to the Subleased Premises resulting therefrom, and surrender the Subleased Premises to the Sublessor in as good a condition as when Sublessee took possession, normal wear and tear excepted.

15. Waste or Nuisance. Sublessee shall not commit or permit the commission by others of any waste on the Subleased Premises. Sublessee shall not maintain, commit, or permit the maintenance or commission of any nuisance on the Subleased Premises nor shall Sublessee use or permit the use of the Subleased Premises for any unlawful purpose.

16. Taxes. Sublessee shall pay when due and prior to delinquency all taxes, assessments, and other charges including possessory interest taxes levied or imposed by any governmental entity on the possessory interest of Sublessee in the Subleased Premises and the personal property, trade fixtures, appliances, and leased equipment placed by Sublessee in, on, or about the Subleased Premises during the Term of this Sublease. Sublessee recognizes that the interests of Sublessee in this Sublease shall be subject to the imposition of a possessory interest tax by the San Bernardino County Assessor, and Sublessee agrees to pay such tax amount as may be so levied with respect to the possessory interest of Sublessee in the Subleased Premises under this Sublease. Sublessee further acknowledges that pursuant to California Health and Safety Code Section 33673, the property shall be assessed in the same manner as privately owned property and Sublessee shall pay taxes upon the assessed value of the entire property and not merely the assessed value of its leasehold interest.

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17. Compliance with Air Force Leases, Airport Deeds, Covenants, Conditions and Restrictions and Related Agreements.
a. Sublessee acknowledges that a copy of the applicable Air Force Leases and/or Airport Deeds are available and on file in the SCLA office. b. Sublessee expressly acknowledges that the Sublessor has assumed certain duties and obligations to the Air Force under the Air Force Leases and/or Airport Deeds affecting the use and occupancy of the Subleased Premises.

Sublessee further agrees that as of the Sublease Commencement Date, it shall observe and perform the duties and obligations of the Sublessor relating to the Subleased Premises in favor of the Air Force which arise under the Air Force Leases. These duties and obligations as assumed by Sublessee include but are not limited to the following which are presented below for purposes of reference and convenience:

I. Air Force Lease Condition 10 (Environmental Protection); and II. Air Force Lease Condition 17 (Development and Alterations); and III. Air Force Lease Condition 26 (Restrictions on Use of Leased Premises)
c. Any use, occupancy or activity of Sublessee on the Subleased Premises which may result in either the receipt by the Sublessor of a notice of default from the Air Force under the Air Force Leases or a notice of default or a notice of violation from either the Air Force or the Federal Aviation Administration (“FAA”) under any Airport Deeds, shall be deemed to be a default of Sublessee under this Sublease.

The response of the Sublessor following receipt of any such notice of default or breach from either the Air Force under the Air Force Leases or from the Air Force and/or the FAA under the Airport Deeds, shall not waive, stay, or otherwise mitigate or remedy the default of Sublessee to the Sublessor under this Sublease. Sublessee shall have no right under this Sublease to participate in any proceeding between the Air Force, the FAA and the Sublessor for the resolution of an alleged default, breach or other dispute of the parties arising under the Air Force Leases and/or the Airport Deeds except to the extent the Sublessee is alleged to have directly caused such breach or default. d. Sublessee acknowledges that the Subleased Premises are, or will be, subject to certain Declaration of Covenants, Conditions and Restrictions to be recorded in the official records of San Bernardino County, California, as amended (the “CC&Rs”). There shall also be included in any assessments the amount of assessments levied pursuant to the CC&Rs and applicable to the Subleased Premises, determined by the ratio that the rentable area of building on the Subleased Premises bears to the total net rentable area of building or buildings which include the Subleased Premises and for which a separate assessment is made pursuant to the CC&Rs.

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18. Insurance.
a. Commercial General Liability Insurance. Sublessee shall procure and maintain at its own expense, during the Term of this Sublease, Commercial General Liability insurance with a company or companies acceptable to Sublessor, of not less than Five Million Dollars ($5,000,000) per occurrence, Ten Million Dollars ($10,000,000) in the aggregate, for bodily injury, personal injury, death, loss, or damage to property resulting from the activities conducted by the Sublessee or its officers, officials, employees, servants, volunteers, and agents and independent contractors on the Subleased Premises. Such policies shall provide coverage for bodily injury, personal injury and property damage to the Subleased Premises based upon, involving or arising out of the use, occupancy or maintenance of the Subleased Premises and all areas appurtenant thereto. Sublessor agrees that the required occurrence and aggregate limits shall include limits from a combination of general liability, umbrella liability and/or excess liability policies.
b. Property Casualty Insurance. Sublessee shall keep in full force and effect during the Term of this Sublease a policy of insurance against fire, vandalism, malicious mischief, and all other perils as are from time to time included in an “all risk” coverage endorsement insuring Sublessee’s improvements constructed on the Subleased Premises, if any, but not any existing improvements constructed on the Subleased premises, in an amount which is at least one hundred percent (100%) of the full replacement cost. Sublessee shall also be required by Sublessor to maintain at its own expense insurance covering any Tenant Improvements (if any are specified in this Sublease), other improvements to the Subleased Premises, Business Income/Extra Expense, Business Personal Property, Supplies, and Equipment. Sublessee's policy must also include a Loss Payee Endorsement naming the Southern California Logistics Airport Authority (“Sublessor”) as a “Loss Payee,” but only with respect to the Tenant Improvements (and not for the Business Personal Property, supplies or equipment). c. Commercial Vehicle Liability Insurance. Sublessee shall further procure and maintain, at its own expense during the Term of this Sublease, a Commercial or Business Auto Liability insurance policy covering Symbol 1 (any auto), or all owned, non-owned, leased, and hired autos, trucks, trailers, or semi-trailers, including and not limited to, any machinery or apparatus attached thereto. Limits shall be no less than One Million Dollars ($1,000,000) per accident or Combined Single Limit (“CSL”) for bodily injury and property damage.
d. Workers’ Compensation Insurance. Sublessee shall procure and maintain at its own expense, during the Term of this Sublease, workers' compensation insurance, providing coverage as required by the California State Workers' Compensation Law. If any class of employees employed by Sublessee is not protected by the California State Workers' Compensation Law, Sublessee shall provide adequate insurance for the protection of such employees to the satisfaction of the Sublessor.

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e. Self-insured. If Lessee is self-insured, it shall provide certificates, documents, or evidence to Lessor indicating that its insurance meets the levels and requirements of as set forth herein above.
f. Additional Insured Status. The Southern California Logistics Airport Authority (“Sublessor”), the City of Victorville, the City Attorney, the Victor Valley Economic Development Authority, the United States Air Force and their officers, officials, employees, servants, volunteers, agents and independent contractors are to be covered as additional insureds on the Commercial General Liability Policy (“CGL”) with respect to liability arising out of work or operations performed by or on behalf of the Sublessee, including materials, parts, or equipment furnished in connection with such work or operations. General Liability coverage can be provided in the form of an endorsement to the Sublessee’s insurance.
g. Waiver of Subrogation Rights. Sublessee shall require the carriers of all required insurance policies except Workers’ Compensation to waive all rights of subrogation against the Southern California Logistics Airport Authority, the City of Victorville, the City Attorney, the Victor Valley Economic Development Authority, the United States Air Force and their officers, officials, employees, servants, volunteers, agents and independent contractors.
h. Environmental Liability. If Sublessee performs work that includes using or storing Hazardous Materials on the Subleased Premises, insurance is also required for third party claims for bodily injury, property damage, and remediation costs stemming from pollution incidents from the Sublessee's operations. i. Primary Coverage. For any claims related to this Sublease, the Sublessee’s coverage shall be primary insurance as respects the Southern California Logistics Airport Authority (“Sublessor”), the Victor Valley Economic Development Authority, the City of Victorville, the City Attorney and the United States Air Force and their officers, officials, employees, volunteers, contractors, and subcontractors. Any insurance or self-insurance maintained by the Southern California Logistics Airport Authority (“Sublessor”), the Victor Valley Economic Development Authority, the City of Victorville, the City Attorney and the United States Air Force and their officers, officials, employees, volunteers, contractors, and subcontractors shall be in excess of the Sublessee’s insurance and shall not contribute with it.

19. Proof of Insurance Coverage.
a. Sublessee shall secure from a good and responsible company or companies authorized to do insurance business in the State of California the policies of insurance required by this Sublease and furnish to Sublessor certificates of said insurance on or before the commencement of occupancy under this Sublease.

Insurance is to be placed with insurers with a current A.M. Best’s rating of not less than A:VII, unless otherwise acceptable to the Sublessor.

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b. The certificates of insurance shall bear an endorsement whereby it is provided that, in the event of cancellation or amendment of any required insurance policy for any reason whatsoever, Sublessor shall be notified by mail, postage prepaid, not less than thirty (30) days before the cancellation or amendment is effective. In the case of non-payment, ten (10) days advance written notice shall be given. c. The certificates of insurance shall bear an endorsement whereby it is provided that the respective insurance policy shall not be terminated or expire without first providing thirty (30) days written notice to Sublessor of such termination or expiration.
d. The certificates of insurance shall indicate that the respective insurance policy will be maintained throughout the Term of this Sublease.

20. Personal Property at Risk of Sublessee. All personal property which Sublessee maintains at the Subleased Premises shall be at the risk of Sublessee only.

Except for the grossly negligent, reckless, or unlawful intentional acts of the Sublessor, its agents, employees, guests, or invitees, the Sublessor shall not be liable for any damage to any property of Sublessee or for any damage to Sublessee’s property in moving the same to or from the Subleased Premises.

21. Utilities and Other Services.
a. Payment for Utility Charges. Sublessee shall contract with and pay the applicable provider, whether the provider is the Sublessor or other party, all charges for water, gas, electricity, waste disposal, sewer or other utilities used or supplied upon or in connection with its use of the Subleased Premises and shall indemnify, defend and hold harmless the Sublessor against any liability on account thereof. Sublessee shall obtain separate metering devices for utility services, as applicable. Sublessee agrees to promptly reimburse the Sublessor upon receipt of invoice, its proportionate share of the actual cost of utility services from any common utility service, which may have been paid by Sublessor. In addition to the amount of the utility bill that the Sublessor may have paid, Sublessee shall pay to Sublessor a three percent (3%) administrative fee for any pass-through billing processed. In no event shall the Sublessor be liable for any interruption or failure in the supply of any such utilities to the Subleased Premises. b. Consent to Energy Use Data Disclosure. By executing this Sublease, Sublessee hereby consents to disclosure of its energy usage data as required for Sublessor to comply with the California Public Resources Code section 25402.10 and the implementing regulations of the California Energy Commission (20 Cal. Code Regs. Sections 1680 through 1685). Strictly for the purposes of ensuring such compliance, including any required public disclosure of aggregated energy use, Sublessee agrees to provide such energy usage data directly to Sublessor and/or authorizes Sublessor to obtain the required energy usage data directly from Sublessee’s utility providers upon request without the need to execute any further authorizations or consent forms. Sublessee’s consent and authorization is deemed SCLAA Standard Sublease Page 12 ComAv Bldg 720, Ste 102

given upon the execution of this Sublease and shall continue to be in effect throughout the Term or any extension thereof.

22. Alterations, Improvements and Additions.
a. Sublessee shall not make any alterations, improvements or additions to the Subleased Premises (collectively hereinafter the “Improvements”) without the prior written consent of the Sublessor. Any machinery, equipment or apparatus, which belongs to Sublessee may be removed by Sublessee at any time prior to the expiration of the Term of this Sublease, or extension thereof. b. Once completed, Improvements authorized in writing by Sublessor and/or any specific Tenant Improvements as may be provided for elsewhere in this Sublease, shall not be removed by Sublessee, unless so required by the Sublessor in its sole discretion. At the end of the Term of this Sublease (or upon any earlier termination as may be provided for herein) Sublessor shall have the option to either require Sublessee to remove the Improvements or Tenant Improvements or elect to have such Improvements or Tenant Improvements become the property of Sublessor.

In the case of removal of equipment or fixtures, Sublessee shall restore the area of the Subleased Premises from which such removals are made to its original condition.

Sublessee shall require the issuance of a Faithful Performance Bond and a Payment Bond for any work performed on the Subleased Premises as set forth below:

BOND REQUIREMENTS - A Faithful Performance Bond benefitting the Sublessor in the amount of one hundred twenty-five percent (125%) of the bid amount and a Payment Bond in the amount of one hundred twenty-five percent (125%) of the bid amount. Bonds must be issued by an admitted surety insurer in the State of California. When a contract for constructing Sublessor-authorized Improvements or Tenant Improvements is signed, the successful bidder shall provide, within ten (10) working days, the Faithful Performance and Payment Bonds in the amounts set forth above in this paragraph.

23. Airport Development. The Sublessor, at its sole discretion, shall determine and may from time to time change the routes of surface ingress and egress to and from the Subleased Premises, but agrees to locate such routes as conveniently as may be done for Sublessee, having in mind the reasonable requirements of the Sublessor with respect to the operation of the SCLA. Notwithstanding the above, if the rerouting of such ingress and egress routes significantly disrupts the normal operations of Sublessee such that it results in material financial detriment to Sublessee, then Sublessee shall have the right to terminate this Sublease.

24. Signs. Sublessee shall not post, install, erect or operate any sign, placard, poster or other device on any part of the Subleased Premises without the prior written permission of the Sublessor. Such signs as may from time to time be permitted by the Sublessor shall be made, posted, maintained and removed, and repair any damage caused by removal, at Sublessee’s own cost and expense. Sublessor shall SCLAA Standard Sublease Page 13 ComAv Bldg 720, Ste 102

have the right to remove unauthorized signs at Sublessee’s expense. Sublessee shall be responsible for all costs associated with the purchase and installation of the required Building Standard Suite Signage in accordance with local codes.

25. Liens. Sublessee shall not suffer or permit any liens to stand against the Subleased Premises, or any part thereof, by reason of any work, labor, services or materials done for, or supplied to Sublessee or anyone holding the Subleased Premises or any part thereof through or under Sublessee. If any such lien shall at any time be filed against the Subleased Premises, Sublessee shall cause such lien to either be discharged of record sixty (60) days after the date that Sublessee receives notice of the filing. Notwithstanding the above, in any bona fide dispute between Sublessee and any third party concerning work done by the third party on or for the Subleased Premises, and as a result of the dispute the third party files a lien against the Subleased Premises, then, in lieu of obtaining the discharge of the lien within the sixty (60) day period, Sublessee, at its option, may either file suit against the third party, a part of the suit being to judicially negate or remove the lien or Sublessee may file an appropriate bond or other device allowed by law to remove the lien.

26. Inspection by the Sublessor. Sublessee shall permit the Sublessor, or its agents, representatives, or employees to enter the Subleased Premises at mutually agreeable, reasonable times for the purpose of inspecting the Subleased Premises to determine whether Sublessee is complying with the terms of this Sublease, for the purpose of doing other lawful acts that may be necessary to protect the Sublessor’s interest in the Subleased Premises, or for the purpose of performing the Sublessor’s duties under this Sublease. Except in the event of an emergency, the Sublessor shall contact Sublessee, no less than twenty-four (24) hours prior to the time that Sublessor desires to enter the Subleased Premises to arrange a mutually agreeable time for the inspection.

27. Damage or Destruction of Subleased Premises. Unless occasioned by the negligence or intentionally unlawful act of Sublessee, if, during the Term of this Sublease, any portion of the Subleased Premises shall be damaged by fire or other catastrophic cause, so as to render such portion of the Subleased Premises untenable, the obligations under this Sublease shall be immediately suspended while such portion of the Subleased Premises remains untenable. In the event of such damage, the Sublessee shall give Sublessor notice of such untenable conditions and the Sublessor shall elect in its sole discretion, whether to repair the Subleased Premises or to cancel this Sublease with respect thereto. It shall notify Sublessee in writing of its election within thirty (30) days after such damage. In the event the Sublessor elects to repair the Subleased Premises, the work or repair shall begin promptly and shall be carried on without unnecessary delay. In the event the Sublessor elects not to repair the Subleased Premises or portion thereof, the Sublease shall be deemed canceled as of the date of damage with respect to the applicable portion. Such damage shall not extend the sublease Term. In the event that insurance proceeds are received by Sublessee under the property casualty policy required to be carried by Sublessee, and the Sublease is terminated under this Section, the Sublessor shall be entitled to the SCLAA Standard Sublease Page 14 ComAv Bldg 720, Ste 102

portion of such proceeds attributable to the fixtures, improvements, and other property which would remain with the Subleased Premises, and Sublessee shall be entitled to the portion of such proceeds attributed to the fixtures and property on the Subleased Premises which would be removed by Sublessee. Notwithstanding anything in this paragraph to the contrary, if the Subleased Premises are rendered inadequate for Sublessee to conduct its normal operations in or upon the Subleased Premises (or such portion of the Subleased Premises which is still tenable), and it is reasonably anticipated that the damages shall not be repaired or otherwise resolved, within sixty (60) days of the date of the accident, then Sublessee, at its sole and exclusive option, may immediately terminate this Sublease. Additionally, irrespective of whether Sublessee remains in possession and occupancy of the Subleased Premises or elects to terminate this Sublease, rent payable under this Sublease shall abate during the period that the Subleased Premises are not totally useable by Sublessee. The abatement shall be pro rata in proportion to the ratio that the amount of space which Sublessee is actually able to occupy and from which it is able to conduct operations bears to the total Subleased Premises. Sublessee shall continue to make all other payments during this period, including taxes.

28. Assignment and Subletting. Sublessee shall not cause, or permit, by operation of law or otherwise, any assignment, encumbrance or transfer of this Sublease or any estate or interest therein without the prior written consent of the Sublessor. Sublessee shall not sublet the Subleased Premises or any part thereof without the prior written consent of the Sublessor. Any consent to a sublease or assignment shall be conditioned upon the proposed subtenant or assignee demonstrating to Sublessor its ability to perform and complete the obligations of Sublessee under this Sublease, a determined by objective standards of financial capability, creditworthiness and experience required for such performance. In addition, if Sublessee’s proposed sublease or assignment arrangement will result in any increased rents or profits accruing to Sublease in excess of the Monthly Base Rent due to Sublessor under this Sublease, such consent shall further be conditioned upon Sublessor receiving fifty percent (50%) of the excess amount thereof. An assignment or subletting shall not relieve Sublessee of any of its obligations or liabilities under this Sublease: both Sublessee and any subsequent assignees will be deemed to be bound hereunder. The Sublessor’s consent to any such assignment, transfer or subletting shall not constitute consent to any further assignment, transfer or subletting. This provision is not intended, nor should it be construed, to prevent Sublessee from allowing such independent contractors onto the Subleased Premises who are involved in Sublessee’s normal operations on the Subleased Premises (such as repair and maintenance personnel, janitorial personnel and similar personnel). Additionally, this provision should not be construed to prevent subcontractors of Sublessee from conducting their work on the Subleased Premises in conjunction with the normal operations conducted by Sublessee. To the extent that Sublessor must grant its consent for Sublessee’s subcontractors to enter onto the Subleased Premises for the above-described purposes, consent is hereby deemed to be granted.

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29. Indemnification.

To the fullest extent permitted by law, Sublessee hereby agrees to defend, indemnify and hold harmless Sublessor, the City of Victorville, the Victor Valley Economic Development Authority, the United States Air Force and each of their respective officers, officials, employees, directors, agents, volunteers, independent contractors and assigns (collectively hereinafter the “Indemnified Parties”), from and against any and all claims, actions, suits, proceedings, demands, losses, judgments and costs and expenses, including attorneys’ fees, arising from any legal action or proceeding initiated by any individual or entity arising out of, or resulting from the performance of this Sublease, except for any such claim arising out of the sole negligence or willful misconduct of the Indemnified Parties.

30. The Sublessor’s Environmental Representations.
a. Except as otherwise provided in Section 14 hereof, Sublessee shall not be held responsible or deemed liable by the Sublessor for any hazardous environmental condition on the Subleased Premises, which existed prior to Sublessee’s occupancy of the Subleased Premises.
b. Except as provided in Section 14 hereof, the Sublessor represents that to the best of its actual knowledge, the Subleased Premises are free from any violations of law or regulations pertaining to occupational hazards and environmental conditions or Hazardous Materials as defined in Section 31 of this Sublease. In the event that any hazardous environmental conditions exist on the Subleased Premises as of the Sublease Commencement Date which result in a loss to Sublessee and which were caused by Sublessor, the Air Force or parties or entities within the control of, or under contract with Sublessor, then the Sublessor shall indemnify, defend and hold Sublessee harmless from any costs, expenses, attorney fees or liabilities relating to any claims of such violations or conditions existing prior to Sublessee’s occupancy of the Subleased Premises. Sublessor shall indemnify Sublessee from hazardous environmental conditions or violations caused directly by the Sublessor, its employees, agents, or licensees during or subsequent to the Term of this Sublease. c. Sublessee shall be solely responsible for obtaining at its cost and expense; any environmental permits required for its operation under this Sublease independent of any existing permits.

30. Compliance with Environmental Laws.
a. The words and phrases set forth below shall have the following definitions:

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I. “Hazardous Materials” means and includes any material that because of its quality, concentration or physical or chemical characteristics, poses a significant present or potential hazard to human health and safety or to the environment if released into the workplace or the environment. Hazardous Materials include hazardous wastes, toxic substances, petroleum products and motor fuels and similar substances and materials, including all substances and materials defined as hazardous or toxic substances or materials under California Health and Safety Code section 25501(n) or any other similarly applicable state, federal or local law.

II. “Environmental Laws” means and includes the various health and safety laws and regulations of state, federal and local agencies pertaining to the manufacture, use, storage, disposal, release, and reporting relating to Hazardous Materials
b. As of the Sublease Commencement Date, Sublessee shall not cause or permit any Hazardous Materials to be used, generated, manufactured, produced, stored, brought upon, or released, on, under or about the Subleased Premises, or transported to and from the Subleased Premises, by Sublessee, its agents, employees, contractors, or invitees in violation of any Environmental Laws.

Sublessee shall indemnify, defend and hold harmless the Sublessor from any damage, cost, expense, liability, fine, or penalty resulting from any unauthorized discharge, emission, spill, storage, release, disposal or use of any Hazardous Materials by Sublessee, its officers, agents, employees, contractors or invitees or any of them. This obligation of Sublessee shall survive the Expiration Date or earlier termination of this Sublease and shall apply whenever the Sublessor incurs cost or liability arising from any use or activity of Sublessee relating to Hazardous Materials during the Term hereof. c. Without limiting the foregoing, if the presence of any Hazardous Materials on, under or about the Subleased Premises caused by Sublessee, its agents, employees, contractors, or invitees results in an unpermitted, unscheduled or unauthorized release or contamination of the Subleased Premises by such Hazardous Materials at any time during the Term of this Sublease, then Sublessee shall at its sole cost and expense promptly take all actions necessary to return the Subleased Premises to the condition existing prior to the unpermitted, unscheduled or unauthorized release of any such Hazardous Materials on the Subleased Premises. d. Sublessee shall immediately notify the Sublessor of the occurrence of any of the following events: (i) receipt by Sublessee of any correspondence or communication from any governmental entity regarding the application of Environmental Laws to the Subleased Premises or the investigation or enforcement by such governmental entity of any such Environmental Laws in connection with Sublessee’s occupancy or use of the Subleased Premises, and (ii) unpermitted, unscheduled or unauthorized release of any Hazardous Materials on the Subleased Premises which may occur at any time during the Term (or any extension thereof) of the Sublease.

SCLAA Standard Sublease Page 17 ComAv Bldg 720, Ste 102

e. To the extent Sublessee may conduct any use or activity on the Subleased Premises which includes the use, handling, transport, or disposal of any Hazardous Materials in quantities which exceed the threshold amounts authorized under California Health and Safety Code Section 25507, Sublessee shall, at its sole cost and expense, prepare and submit to the City of Victorville (or designated local Certified Unified Program Agency “CUPA”) for approval, renewal or amendment, as applicable, a Business Plan for the Subleased Premises, as the term “Business Plan” is described under California Health and Safety Code Section 25505. f. Notwithstanding any of the foregoing, in the event Sublessee, its agents, employees, contractors, or invitees, fails to use and maintain the Subleased Premises in accordance with the provisions of this Section 31, Sublessor and/or the City of Victorville (the “City”) shall have the right, but not the obligation, to enter the Subleased Premises and undertake remedial action as necessary in order to ensure that the Subleased Premises are in compliance with all Environmental Laws. In such event, Sublessee shall reimburse Sublessor and/or the City for all reasonable sums incurred by it for such remediation activities. In such event Sublessor may, in its sole discretion, and not limiting its ability to recover through any other means provided in law or equity, determine to deduct all or a part of such sums due under this section from the Security Deposit.

31. Surrender of Subleased Premises. On the Expiration Date of this Sublease, Sublessee shall surrender and deliver possession of the Subleased Premises to the Sublessor clean and free of debris and in as good condition as it was on the Sublease Commencement Date, reasonable wear and tear excepted.

32. Compliance with Laws. Sublessee shall comply with all applicable Federal, State, and local laws, regulations and standards that are or may become applicable to Sublessee’s activities on the Subleased Premises (hereafter collectively “Laws”, including without limitation the SCLA and FAA Rules and Regulations).

Sublessee agrees to abide by and conform to the SCLA Rules and Regulations, attached hereto as Exhibit B, and incorporated herein by this reference as such may be amended from time to time, and to cause its officers, agents, employees, suppliers, shippers, customers, and invitees to so abide and conform. The Sublessor shall have the right, from time to time, to modify, amend and enforce said rules and regulations. In addition, Sublessee agrees to abide by the Selected FAA Rules and Regulations, attached hereto as Exhibit C and incorporated herein by this reference, as such may be amended from time to time, and to cause its officers, agents, employees, suppliers, shippers, customers, and invitees to so abide and conform. The Sublessor shall not be responsible to Sublessee for the noncompliance with said rules by other tenants, their officers, agents, employees and invitees. The judgment of any court of competent jurisdiction, or the admission of Sublessee in a proceeding brought against Sublessee by any government entity, that Sublessee has violated any such Laws (except where such admission may be the basis for settlement) shall be conclusive as between the Sublessor and Sublessee and shall constitute grounds for declaration of default, breach, forfeiture, and termination of this Sublease by the Sublessor.

SCLAA Standard Sublease Page 18 ComAv Bldg 720, Ste 102

33. Defaults.
a. In the event Sublessee should default in the performance of any covenant or condition of this Sublease (excluding the payment of any monthly rent or other amounts due hereunder) and such default is not cured or removed within thirty (30) days after service of written notice upon Sublessee of such default in the performance of any covenants and conditions; then in such event, the Sublessor shall have the right and option to terminate this Sublease, to re-enter the Subleased Premises, to evict Sublessee and to remove Sublessee’s possessions, all without being deemed guilty of any trespass, and without prejudice to any claim for arrears of rent or breach of covenant. Notwithstanding the foregoing, if Sublessee, prior to the expiration of such thirty (30) day period for default diligently commences to cure such default but is unable to do so within the thirty (30) day period, then such period shall be extended for an additional thirty (30) days provided Sublessee continues to make a diligent effort to cure the default.
b. Failure to pay Monthly Base Rent or any other amounts required to be paid to Sublessor by Sublessee when due shall also be deemed a default which Sublessee shall cure such default within ten (10) days after service of written notice. c. Any statutory notice required as part of any eviction action or similar type of proceeding may be included with any notice of default given pursuant to this Section and the Sublessor need not declare a default and have such default remain uncured prior to delivery of such statutory notice.

34. Remedies of the Sublessor. In the event of any breach of the Sublease by Sublessee and the cure periods described in Section 34 hereof have expired, the Sublessor may at any time thereafter, with or without notice or demand and without limiting the Sublessor in the exercise of any other right or remedy which the Sublessor may have by reason of such breach, do any of the following:
a. terminate Sublessee’s right to possession of the Subleased Premises by any lawful means, in which case this Sublease shall terminate, and Sublessee shall surrender possession of the Subleased Premises to the Sublessor.

This may involve the Sublessor filing an unlawful detainer action and receiving a court order for Sublessee to vacate the premises. In any such event, the Sublessor shall be entitled to recover from Sublessee all damages incurred by the Sublessor by reason of Sublessee’s default, including, but not limited to the cost of repairing or restoring damages to the Subleased Premises caused by Sublessee, the cost or removal of Sublessee’s improvements, fixtures and other contents of the Subleased Premises, costs associated with past or future brokerage commissions and marketing expenses and the other costs payable by the Sublessor in connection with the recovery of possession of the Subleased Premises, including but not limited to reasonable attorneys’ fees and court costs, as well as: (a) the worth at the time of award by the court having jurisdiction thereof of the unpaid rent which had been earned at the time of termination; and (b) the worth at the time of award by the court having jurisdiction SCLAA Standard Sublease Page 19 ComAv Bldg 720, Ste 102

thereof of the amount by which the unpaid rent for the balance of the Term after the time of such award may exceed the amount of such rental loss for the same period that Sublessee proves could be reasonably avoided; or
b. pursue any other remedy now or hereafter available to the Sublessor under the laws or judicial decisions of the State of California.

35. Default by the Sublessor. In the event Sublessor should default in the performance of any covenant or condition of this Sublease and such default is not cured or removed within thirty (30) days after service of written notice of default upon Sublessor, then in any such event, Sublessee shall have the right and option to terminate this Sublease. If Sublessor, prior to the expiration of such thirty (30) day period for a default, diligently commences to cure such default, but is unable to do so within the thirty (30) day period, then such period shall be extended for an additional thirty (30) days provided Sublessor continues to make a diligent effort to cure the default. In event of uncured default Sublessee shall have all remedies available at law or in equity for any default or breach of this Sublease by the Sublessor.

36. Force Majeure-Unavoidable Delays. If the performance of any act required by this Sublease to be performed by either Party is prevented or delayed by reason of an act of God, strike, lockout, labor disputes, inability to secure materials, unreasonably restrictive governmental laws or regulations, or any other cause except financial inability that is not the fault of the Party required to perform the act, the time for performance of the act will be extended for a period equivalent to the period of delay, and performance of the act during the period of delay will be excused. However, nothing contained in this Section shall excuse the prompt payment of rent by Sublessee as required by this Sublease or the performance of any act rendered difficult solely because of the financial condition of the Party required to perform the act.

37. Notices. Any and all notices or demands required or permitted to be given hereunder must be personally delivered or be mailed by registered or certified mail, return receipt requested, addressed as follows:

To the Sublessor: Southern California Logistics Airport Authority 18374 Phantom West
Victorville, CA 92394
Attn: Airport Director
With copies to: Green de Bortnowsky, LLP
30077 Agoura Court, Suite 210
Agoura Hills, CA 91301
Attn: Andre de Bortnowsky, Esq.

SCLAA Standard Sublease Page 20 ComAv Bldg 720, Ste 102

To Sublessee: ComAv Technical Services LLC
18499 Phantom West, Building 17
Victorville, CA 92394
Attn: Udo Rieder
or at such other address or addresses that either Party may hereafter designate in writing to the other. Any notice or demand which is mailed by registered or certified mail as provided above shall be deemed to be effective and given for all purposes three (3) business days following the time of deposit thereof in the United States mail.

38. Miscellaneous.
a. One or more waivers of any provision of this Sublease by the Sublessor shall not be construed as a waiver of a subsequent breach of the same provision and the Sublessor’s consent or approval shall not be deemed to waive or render unnecessary the Sublessor’s consent or approval to or of any subsequent or similar act by Sublessee.
b. If either Party to this Sublease shall bring any action for any relief against the other, declaratory or otherwise, to enforce the terms hereof or to declare rights here under (collectively, an Action), the losing Party shall pay to the prevailing Party attorneys’ fees and costs incurred in bringing and prosecuting such Action and/or enforcing any judgment, order, ruling, or award (collectively, a Decision) granted therein, all of which shall be deemed to have accrued on the commencement of such Action and shall be paid whether such Action is prosecuted to a Decision. Any Decision entered in such Action shall contain a specific provision providing for the recovery of attorneys’ fees and costs incurred in enforcing such Decision. The court may fix the amount of reasonable attorneys’ fees and costs on the request of either Party. For the purposes of this paragraph, attorneys’ fees shall include, without limitation, fees incurred in the following: (1) post-judgment motions and collection actions; (2) contempt proceedings; (3) garnishment, levy, and debtor and third party examinations; (4) discovery; and (5) bankruptcy litigation. “Prevailing Party” within the meaning of this paragraph includes, without limitation, a Party who agrees to dismiss an Action upon the other Party’s payment of the sums allegedly due or performance of the covenants allegedly breached, or who obtains substantially the relief sought by it. Nothing contained in the Section shall be interpreted to mean that Sublessor has agreed to arbitrate any dispute which may arise hereunder.
c. This Sublease can be modified, supplemented, amended or rescinded only by a writing expressly referring to this Sublease and signed by Sublessor and Sublessee.
d. If any provision of this Sublease or any application thereof shall be invalid or unenforceable, the remainder of this Sublease and any other application of such provision shall not be affected thereby. Unless otherwise expressly provided herein, any approval or consent of Sublessor required hereunder shall not be SCLAA Standard Sublease Page 21 ComAv Bldg 720, Ste 102

unreasonably withheld or delayed. This Sublease shall be binding upon and inure to the benefit of and be enforceable by the respective successors of the Parties hereto. The Section headings in this Sublease are for purposes of reference only and shall not limit or define the meaning hereof.
e. This Sublease contains the entire understanding and agreement of the Parties, supersedes all prior understandings and agreements, and cannot be changed orally. This Sublease shall be construed in accordance with the laws of the State of California. Time is of the essence.
f. Any conflict between the printed provisions, exhibits, or addenda of this Sublease and the typewritten or handwritten provisions, if any, shall be controlled by the typewritten or handwritten provisions provided such typewritten or handwritten provisions are initialed by both Parties.
g. This Sublease shall be of no force and effect unless executed by both Parties. Each person executing this Sublease for the respective Parties expressly represents and warrants that he or she has the authority to enter into leases on behalf of and bind the entity on whose behalf this Sublease is executed. h. This Sublease may be executed by the Parties in counterparts, and when executed by each of the Parties, each counterpart shall be deemed to be a part of the same instrument.
[END OF THIS PAGE – SIGNATURES FOLLOW]
SCLAA Standard Sublease Page 22 ComAv Bldg 720, Ste 102

IN WITNESS WHEREOF, the Parties have executed this Sublease Agreement as of the day and year first written above.
[SUBLESSEE]

COMAV TECHNICAL SERVICES LLC
_______________________________
Udo Rieder
_____________________
Date
Chief Executive Officer
[SUBLESSOR]
SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY (“SCLAA”) __________________________
C. Eric Ray
_____________________
Date
Airport Director
ATTEST:
__________________________
Jennifer Thompson
_____________________
Date
SCLAA Secretary
APPROVED AS TO STANDARD FORM:
________________________
Andre de Bortnowsky
SCLAA Legal Counsel
_____________________
Date

RISK MANAGER
__________________
Sandra Bostick
_____________________
Date
SCLAA Standard Sublease Page 23 ComAv Bldg 720, Ste 102

EXHIBIT A

DESCRIPTION OF SUBLEASED PREMISES
Building 720, Suite 102, consisting of approximately Thirteen Thousand One Hundred Fifteen (13,115) square feet of office space located on the SCLA, at 18708 Readiness Street, Victorville, California 92394, as depicted on Exhibit A-1 and Exhibit A-2.

Vehicle parking space is depicted in yellow on Exhibit A-2 as “Vehicle Parking”.

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Exhibit A-1
13,115

Exhibit A-2
Bldg 720Bldg 720 Bldg 720
Suite 100 Suite 101 Suite 102 Vehicle
Parking
Readiness Street

EXHIBIT B

SCLA RULES AND REGULATIONS
SCLAA Standard Sublease Page 25 ComAv Bldg 720, Ste 102

Exhibit B
Southern California
Logistics Airport
Rules and Regulations
Amended
April 17, 2007

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

RULES AND REGULATIONS FOR THE USERS OF SOUTHERN CALIFORNIA LOGISTICS AIRPORT; ESTABLISHING FEES FOR THE VARIOUS USES; DEFINING TERMS; PROHIBITING OR LIMITING CERTAIN ACTIVITIES; FIXING PENALTIES FOR VIOLATIONS; AND PROVIDING FOR AMENDMENTS TO

THESE RULES AND REGULATIONS AS MAY BE NEEDED FROM TIME TO TIME SECTION 1. SHORT TITLE:

1.1 These Rules and Regulations shall be referred to as the Southern California Logistics Airport (SCLA) Rules and Regulations. It may be amended by a majority vote by the Board of the Southern California Logistics Airport Authority (SCLAA).

SECTION 2. APPLICABILITY:

2.1 These Rules and Regulations apply equally to every Airport User. The Airport Operating Manual or Specifications, as applicable, adopted in accordance with FAR Part 139, and the Airport Policies and Procedures Manual are hereby made by reference a part of these Rules and Regulations.

SECTION 3. RESPONSIBILITIES:

3.1 Management: It shall be the responsibility of the Airport Director to fairly and impartially administer these Rules and Regulations.

3.2 Users: It shall be the responsibility of every Airport User, pilot or other, to become familiar with the SCLA Rules and Regulations and to obey those Rules and Regulations. Current copies of these Rules and Regulations will be maintained reflecting any amendments and will be posted at the SCLA Administrative Office and at Million Air. Additional copies will be provided by the SCLA Airport Director through the SCLA Administrative Office to any Airport User who requests such copy.

SECTION 4. DEFINITIONS:

For the purposes of these Rules and Regulations, the following definitions and meanings shall apply unless otherwise specified:

4.1 “Air Operations Area” or “AOA” means the area upon which aircraft are able to operate and includes the runways, taxiways, taxi lanes, apron area, and the vehicle and personnel gates that lead to these areas.

4.2 “Air Carrier” means any person who undertakes directly, by lease, or other arrangement, to engage in air transportation of persons or things. An “Air Carrier” operates in various categories, under authority or certification by the FAA and holds a current FAA certificate to transport air passengers or property for hire.

Pg.1 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

4.3 “Aircraft” means a device that is used, or is intended to be used, for flight in the air. “Aircraft” includes airplanes, helicopters and gliders, and lighter than air devices such as blimps or balloons, but does not include hang gliders.

4.4 4.5
“Aircraft Owner” shall mean a Person who holds title to an Aircraft. “Aircraft Operator” shall mean the Person who is operating or controlling an Aircraft while said Aircraft is on Airport property.

4.6 4.7
“Aircraft Storage” shall have the same meaning as “Stored Aircraft”. “Airport” means the SCLA, its buildings and facilities, all lands owned and or controlled by the SCLAA contiguous to the airport, including airspace above such land and the designated approaches thereto.

4.8 4.9
“Airport Director” means that person so appointed by the SCLAA or his designated representative.
“Airport Master Security Program” or “Airport Security Program” means the Security Program, which is the responsibility of an Airport Operator pursuant to TSA 1542.

4.10 “Airport Operations and Security Department” or means the Airport Operations and Security Department of the Southern California Logistics Airport.

4.11 “Airport Security Areas” or “Secure Areas” means Air Operations Areas, roadways, and common Air Carrier areas within terminal facilities (i.e. baggage makeup areas), excluding exclusive leasehold structural areas, to which public access is limited or denied under Airport Master Security Program.

4.12 “Airport Security Coordinator” or “ASC” means an individual appointed by the Airport Director, charged with the responsibility to implement and enforce the Airport Master Security Program, employed by the City of Victorville and under the direction of the Airport Director, or the Airport Security Coordinator’s designated representative.

4.13 “Airport Tenant” means an individual, partnership, corporation or other business entity, and its agents, employees, representatives, and subtenants which occupies or controls all or part of Airport areas, buildings or other facilities which they lease from the Southern California Logistics Airport Authority.

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4.14 “Airport Tenant Security Program” shall have the same meaning as set forth in TSA1542.113, entitled “Airport Tenant Security Programs.”

4.15 “Airport User” means any Person who uses the Southern California Logistics Airport, including but not limited to, Airport Tenants and subtenants, Fixed Base Operators, Air Carriers, Aircraft Owners, Aircraft Operators, Commercial Operators, passengers, and their employees, agents, representatives, agents, successors and assigns.

4.16 “Authorized Person” means an individual authorized with a Personnel Identification Badge issued by the Airport Security Coordinator, or his designated representative, to have unescorted access authority to Airport Security Areas.

4.17 “Air Traffic” means Aircraft operating in the air or on an Airport surface, exclusive of loading ramps or parking areas.

4.18 “Air Traffic Clearance” means an authorization issued by Air Traffic Control personnel for an Aircraft to proceed under specified traffic conditions within controlled airspace.

4.19 “Air Traffic Control” or “ATC” shall mean the Air Traffic Control of the Southern California Logistics Airport.

4.20 “Airworthy Condition” means a condition wherein an Aircraft can take flight under its own power. See definition of “Non-Airworthy Aircraft” below.

4.21 “Autorotation” means a rotorcraft flights condition in which the lifting rotor is driven entirely by action of the air when the rotorcraft (helicopter) is in motion.

4.22 “Balloon” means a lighter-than air aircraft, which is not engine-driven.

4.23 “Based Aircraft,” means Aircraft that are parked on the Airport for thirty (30) days or longer and are not part of an aircraft storage program.

4.24 “Ceiling” means the height above the earth's surface of the lowest layer of clouds or obscuring phenomena, that is reported as “broken,” “overcast,” or “obscuration,” and is not classified “thin” or “partial”.

4.25 “City” means the City of Victorville.

4.26 “Commercial Operator” means any Person who, for compensation or hire, engages in the carriage of persons, property, or mail in air commerce, or engages in other aerial activity such as flight instruction, aerial photography, fire fighting, agricultural aviation activities, or traffic surveillance.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

4.27 “Criminal History Records Check (CHRC)” means a fingerprint-based criminal history records check as described in 49 CFR § 1542.

4.28 “Commercial Use” means use of SCLA for revenue-producing commercial activities.

4.29 “Dismantled Aircraft” means an Aircraft which has been disassembled to a point where it is not reasonable to assume that said Aircraft can be reassembled and placed in an Airworthy Condition.

4.30 “Driving Permit” means a permit issued by the Airport Director or his designee in order for an Individual to operate a Vehicle on the Airport.

4.31 “Escort” means an Authorized Person or Authorized Persons accompanying, monitoring, directing and controlling the actions of an Individual or Individuals who are not displaying Personnel Identification Badges, and/or who are not otherwise Authorized Persons, within Airport Security Areas. The Authorized Person(s) performing an Escort must be displaying valid Personnel Identification Badges, must be accompanying the Individual or Individuals for performance of direct job duties and must ensure that those Individuals who are being escorted remain within sight and sound at all times.

4.32 “Executive Director” means the Executive Director of the Southern California Logistics Airport Authority.

4.33 “FAA” means the Federal Aviation Administration of the United States Government or any federal agencies succeeding to its jurisdiction.

4.34 “Fixed Base Operator” means any Person who rents, leases, or owns facilities located on SCLA, who by virtue of his specific type of aviation or aviation related activity, requires the occupancy of a site with contiguous aircraft apron and direct access to the Aircraft Operation Area, and who engages in a business activity providing aviation sales or service, including but not limited to any of the following:

1. Selling and/or servicing new and used Aircraft and
component parts;

2. Aircraft maintenance and repairs;

3. Sales and/or repair of avionics;

4. Aviation training (including ground or flight instruction);

5. Aerial photography;
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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

6. Air ambulance service;

7. Aircraft agricultural operations (crop dusting, spraying, or the application of seed, fertilizers, pesticides, defoliants, etc);

8. Aircraft rental, charter, leasing;

9. Aircraft Storage;

10. Fuel and oil sales and servicing; and

11. Aircraft servicing or ground handling including cargo handling, baggage handling, lavatory service, water service, air starts, ground power, or other elements related to aircraft handling.

4.35 ”Flight Visibility” means the average forward horizontal distance from the cockpit of an Aircraft in flight, at which prominent unlighted objects may be seen and identified by day, and prominent lighted objects may be seen and identified by night.

4.36 “Ground Visibility” means prevailing horizontal visibility near the earth's surface.

4.37 “Helicopter” means a rotor driven aircraft (rotorcraft) that, for its horizontal motion, depends primarily on its engine-driven rotors.

4.38 “IFR” means Instrument Flight Rules covering meteorological conditions below the minimums for flight under visual (VFR) conditions.

4.39 “Individual” means a natural person.

4.40 “Maintenance” means inspection, overhaul, repair, preservation, and the replacement of parts, including preventive maintenance.

4.41 “Movement Area” means the runways, taxiways, and other areas of the Airport, which are utilized for taxiing, takeoff, and landing of Aircraft. The Movement Area does not include parking and loading ramps. Entry into the Movement Area requires ATC approval.

4.42 “Night” means the time between the end of evening civil twilight and the beginning of morning civil twilight as published in the American Air Almanac, converted to local time.

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4.43 “Non-Airworthy Condition” means when an Aircraft cannot take flight under its own power as a result of being in disrepair or in the process of being disassembled.

4.44 “Notice of Violation” means a written notification of non-compliance with these Rules and Regulations, issued by the Airport Director or his designated representative.

4.45 “Person” means an individual, firm, partnership, corporation, company, association, joint-stock association, or governmental entity, and includes a trustee, receiver, assignee, or similar representative of any of them.

4.46 “Personnel Identification Badge” means a Personnel Identification Badge issued to an Individual by the Southern California Logistics Airport for purposes of granting that Individual unescorted access authority to the Restricted Area.

4.47 “Ramp” means an improved surfaced area reserved exclusively for the parking and taxiing of Aircraft.

4.48 “Restricted Area” means all areas or facilities accessible only by Authorized Persons or Persons under Escort, and including all Ramp areas and the Aircraft Operations Area (AOA).

4.49 “Roadway” means that portion of an area improved or designed or ordinarily used for vehicular travel. A roadway on the Airport Operations Area is called a vehicle service road (“VSR”).

4.50 “Runway” means an improved surfaced area reserved exclusively for the landing and taking off of Aircraft.

4.51 “Scheduled Air Carrier” means any Person providing scheduled passenger or cargo service from the Airport in accordance with a published schedule and having at least one scheduled departure per day, or no less than five scheduled departures per week, and operating under authority of the Federal Aviation Administration and the Airport.

4.52 “Security Perimeter” means the portion of the Airport that is enclosed by fencing, walls or other barriers, and to which access is controlled through designated entry points.

4.53 “SCLA” means Southern California Logistics Airport.

4.54 “SCLAA” means Southern California Logistics Airport Authority.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

4.55 “Security Devices” means equipment installed or placed by or under the direction of the Southern California Logistics Airport Authority, or designated representative, to monitor or control entrances to and exits from Airport Security Areas. “Security Devices” include, but are not limited to, bells, sirens, communication equipment, locks and corresponding keys, emergency exits, electronic access control and other security equipment.

4.56 “Security Identification Display Area” or “SIDA” shall have the same meaning as set forth in TSA1542.205. Before being granted unescorted access to the SIDA, Individuals must undergo a Criminal History Record Check and employment history verification.

4.57 “Security Screening Area” means an access point, including entrances and exits, to the Airport Security Areas, Secure Areas and the Sterile Areas, where Vehicles, equipment, Individuals, and belongings are inspected prior to entrance.

4.58 “Sterile Area” means an area to which access is controlled by the inspection of Individuals and property in accordance with FAA and TSA requirements.

4.59 “Stirling Airport International” or “SAI” means SCLA’s development partner.

4.60 “Stored Aircraft” means aircraft that are parked at/on airport property and are part of an aircraft storage program.

4.61 “Taxiway” means an improved surfaced area reserved exclusively for use by aircraft to proceed to and from ramp and runway areas.

4.62 “Traffic Pattern” means the traffic flow that is prescribed for aircraft landing at or taking off from SCLA.

4.63 “Unnecessary Noise” means any engine noise that is greater than the level produced when the engines are at idle except when required for taxiing of the aircraft, takeoff or landings.

4.64 “Vehicle” means every device in, upon or which any Individual or property is or may be transported or drawn upon a roadway, excepting devices moved by human power or used exclusively upon stationary rails or tracks. A bicycle shall be considered a vehicle under all portions of these Rules and Regulations, which govern right-of-way.

4.65 “Vehicle Owner” means a person who holds the legal title of a vehicle.

4.66 “Vehicle Service Road” or “VSR”. (See Roadway.)

4.67 “VVEDA” means the Victor Valley Economic Development Authority.

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4.68 “VFR” means Visual Flight Rules covering meteorological conditions, above those requiring flight under IFR conditions.

4.69 “Word Construction”: The following construction applies throughout these Rules and Regulations:

1. 2.

3. Words importing the singular include the plural,
Words importing the plural include the singular; and,
Words importing the masculine gender include the
feminine and the neutral gender.

SECTION 5. NECESSITY:

5.1 These Rules & Regulations are enacted to protect the health, safety and peace, and to promote the welfare and convenience of the general public using SCLA, or affected by activities related to the Airport by providing for the orderly conduct of activities on, or related to, the Airport. The use of the Airport or any of its facilities in any manner shall create an obligation on the part of the Airport User to obey all of the rules and regulations herein provided.

SECTION 6. BASED AIRCRAFT:

6.1 Any Person desiring to base an Aircraft at SCLA shall register such Aircraft at the Airport Operations and Security Department as soon as possible but not later than 24 hours after the arrival of the Aircraft. If a change in ownership occurs while the Aircraft is based at the Airport, the new Aircraft Owner shall re-register the Aircraft with the Airport Operations and Security Department, again, no later than 24 hours after the change in ownership occurred.

6.2 Except as specifically set forth in an Airport land or facility sublease, Aircraft in a Non-Airworthy Condition shall not be permitted to remain on the Airport in excess of five (5) days without the express prior written permission of the Airport Director. Such Aircraft shall be removed from the Airport or stored at the Aircraft Owner’s expense.

SECTION 7. AIRCRAFT STORAGE AND PARKING:

7.1 Aircraft shall only be stored or parked at places as set forth in such Person’s sublease or as may be authorized by the Airport Director, and such storage or parking shall be at the sole risk of the Aircraft Owner and/or Aircraft Operator, and without any responsibility to SCLAA, VVEDA or Stirling Airport International, or any of their officers, employees, agents or representatives, for any loss of, or damage to the Aircraft while so stored or parked. The Aircraft Owner and/or the Aircraft Operator shall be responsible for the tying-down and/or securing of his Aircraft. The Aircraft Owner and/or Aircraft Operator shall likewise be responsible for any liability arising from or caused by his Pg.8 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Aircraft or his activities. All Airport Tenants desiring to store Aircraft at SCLA must notify the Airport Director in writing prior to the Aircraft arriving at SCLA.

SECTION 8. COMMERCIAL ACTIVITY:

8.1 No Person shall utilize SCLA for any revenue-producing commercial activities without the express written permission of SCLAA or its designated representative, and obtaining a City of Victorville Business License for such activities, and paying the fees and charges established for such use or license.

SECTION 9. AIRPORT FEES:

9.1 Funding for Airport operations and capital improvements is derived through various types or classes of Airport User Fees. Airport User fees are specifically established to compensate the Airport for the use, maintenance and repair of Airport facilities, as well as to minimize the need for on-going general taxpayer support.

9.2 9.3
A schedule of rates and charges for the use of the Airport and its facilities may be found as Attachment A to these Rules and Regulations.

Any Aircraft Owner or Aircraft Operator who fails to pay any fee duly charged for Aircraft owned or controlled by him shall have such Aircraft subject to impounding until the fees are paid, along with any impound fees, or until the Aircraft is sold for charges.

SECTION 10. HOURS OF OPERATION:

10.1 SCLA shall be open for public use at all hours of the day and night, subject to any restrictions imposed by the Airport Director due to inclement weather, condition of the landing area, presentation of special events, construction or repair activities, or similar causes. The control tower is open 24 hours a day, 7 days a week. The Airport is attended from 6:00 A.M. to 10:00 P.M. daily by Million Air. Services may be obtained from Million Air during said hours at telephone number (760) 246-7794 or UNICOM (122.85 MHz).

SECTION 11. UNATTENDED AIRCRAFT:

11.1 No Aircraft shall be left unattended on the Airport unless properly secured or within a hangar. Aircraft Owners and/or Aircraft Operators of Aircraft left so unattended shall be liable for damage to other Aircraft or property resulting from the failure to adequately secure or tie down the Aircraft.

SECTION 12. MAINTENANCE:

12.1 Unless otherwise authorized by the Airport Director, or specified as a permitted use in an Airport facility or land sublease, no Aircraft or Vehicle maintenance, other than that which is required to remove damaged Aircraft from the Runway or Taxiway(s), or that which is necessary to replace a flat tire, shall be Pg.9 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS performed at SCLA except in areas specifically designated by the Airport Director for that purpose.

SECTION 13. EQUIPMENT REQUIREMENTS:

13.1 Every Aircraft using SCLA shall be equipped with a fully functional, two-way radio, except when operating into or from the Airport under an FAA waiver for radio maintenance. The ATC frequency is 118.35 MHz and the ground control frequency is 124.45 MHz. Weather and traffic advisories are broadcast on 109.40 MHz. No fixed-wing Aircraft equipped with a tailskid shall operate on any paved surface of SCLA.

SECTION 14. ACCIDENTS:

14.1 Every Person involved in, or witnessing an Aircraft operating accident on the Airport shall report promptly the details of such accident to the Airport Director, ATC, or FAA.

14.2 In addition, the Aircraft Owner and/or the Aircraft Operator, including pilot, shall report fully to the California Division of Aeronautics the details on any accident in which there is death or injury, or in which damage to the property of others exceeds $400.00.

14.3 The Aircraft Owner and/or the Aircraft Operator of an Aircraft which is damaged or wrecked in an accident shall be responsible for the prompt removal of the Aircraft as directed by the Airport Director.

14.4 Where the Aircraft Owner and/or Aircraft Operator of an Aircraft which is damaged or wrecked in an accident is unable to arrange for removal of such disabled or wrecked Aircraft, the Airport Director shall have the authority to move, or arrange the removal of, the Aircraft when released (if applicable) by the FAA or the National Transportation Safety Board (NTSB).

14.5 No liability shall be incurred by the SCLAA, SAI, VVEDA, the Airport Director or any of their officers, employees, agents, successors and assigns, for damage aggravated by, or resulting from, removal of an Aircraft pursuant to Section 14.4 of these Rules and Regulations.

SECTION 15. NOISE:

15.1 No Person shall operate any Aircraft in flight or on the ground in such a manner as to cause Unnecessary Noise as determined by applicable Federal or State or local laws and regulations.

SECTION 16. RESTRICTED AREAS:

16.1 Restricted Areas include those areas leased to the Army National Training Center, Advanced Unmanned Systems-Concept Exploration, Southern California Aviation, Victorville Aerospace LLC, Army Reserve, or other area that has direct access to the AOA. No Person shall enter any Restricted Area Pg.10 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS except (a) employees or invitees of the leaseholder, (b) Persons duly authorized by the Airport Director, including, but not limited to, Authorized Persons who have received Personnel Identification Badges, or (c) security or fire-fighting personnel.

16.2 Every Person who has access to a restricted area shall close and lock the door, gate or other device immediately after it has been used unless it is under surveillance of a Person who is responsible for controlling entry at that access point.

16.3 Every Airport Tenant whose premises have total or limited access to any Restricted Areas shall prevent access to the Restricted Areas by Persons who are not authorized to have such access.

16.4 The Airport Director’s staff is authorized to close and lock any door, gate or other device permitting access to a Restricted Area that is found open or unlocked and unattended.

16.5 Every Person to whom a key, code or access device has been issued by the Airport Security Director, or his designated staff, shall use the key, code or access device to enter a Restricted Area only in accordance with any conditions of issuance and only at Restricted Area access points.

16.6 Except where authorized by the Airport Director and subject to any conditions of issuance, no Person shall:

1. Loan or give to another Person a key, code or access device issued to him; or

2. Have possession of, or use for any purpose, a key, code or access device that was issued to him by a Person not
having authority to do so.

SECTION 17. ANIMALS:

17.1 No Person shall willfully and knowingly allow or permit any animal owned, possessed, or harbored by him to enter the Airport unless the animal is leashed or restricted in such manner as to be under control, or is in a shipping container, or is otherwise under physical restraint, nor shall any Person allow or permit such animal except “special assistance animals” (i.e. guide dog) to enter any Airport building without the approval of the Airport Director.

SECTION 18. ACCESS TO RUNWAYS AND TAXIWAYS:

18.1 No Person shall enter upon any Runway or Taxiway, or the movement area as defined by FAA, without the express consent of the Air Traffic Control Tower representative.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS SECTION 19. STARTING ENGINES:

19.1 No Person shall start any Aircraft engine at SCLA:

1. Unless a competent operator is at the controls;

2. Unless the Aircraft is equipped with adequate brakes fully applied or the wheels are securely blocked with blocks or chocks that can be removed safely (Skid equipped helicopters do not have brakes or chocks);

3. When the Aircraft is in such a position that the propeller slipstream or jet blast can cause damage to, or interfere with the operation of, other Aircraft, Vehicles, mobile equipment, hangars, shops, other buildings, or can cause injury to passengers, spectators, or other personnel; and

4. When the Aircraft is within 50 feet of any building without prior written consent.

SECTION 20. ENGINE RUN-UPS:

20.1 No Person shall conduct an aircraft engine run-up beyond idle anywhere on the Airport other than in areas designated by the Airport Director (with the exception of helicopters, which routinely operate with engines beyond idle as part of normal operations).

20.2 Persons who want to conduct an engine run-up beyond idle shall first call ATC on the ground control frequency, 124.45 MHz, and request clearance to one of the two engine run-up areas. ATC will advise the Airport User, given the current wind direction, to proceed to one of two designated engine run-up areas.

20.3 ATC will make the final determination of which engine run-up area should be used.

20.4 The Person requesting the engine run-up beyond idle will conduct the engine run-up in the area designated by ATC and he shall exercise the necessary caution to ensure no damage is created by the engine run-up.

SECTION 21. TAXIING:

21.1 Only those personnel that have training and are qualified to taxi a particular type of Aircraft are permitted to taxi Aircraft at SCLA.

21.2 No Person shall taxi any Aircraft into, out of, or within any hangar or other building on or adjacent to the Airport.

21.3 No Person shall taxi any Aircraft across the double yellow lines on the edge of Taxiways and the apron.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

21.4 Nor shall any Person move any Aircraft under its own power on the Airport unless that Person is in full control of such aircraft, and has assured himself that there is no danger of collision with other Aircraft, Vehicles, equipment, buildings, or other obstacles. Aircraft shall be taxied at a safe speed.

SECTION 22. DUMPING REFUSE:

22.1 No Person shall place, deposit, or dump any garbage, cans, bottles, papers, ashes, sewage, carcass of any dead animal, offal, trash rubbish, debris or any other refuse in any location on the Airport except in containers designed for such purposes.

SECTION 23. FIREARMS:

23.1 No Person shall shoot any projectile from a firearm or other device, into, on, or across any portion of the Airport, nor have in his possession, or under his control, any firearm which is not unloaded and securely wrapped and boxed for shipment, or explosive or explosive device; provided,

23.2 However, that this Section does not apply to peace officers, military personnel, or Airport security guards who are acting in the performance of their duties as such. Firearms on Airport property are pre-coordinated with ASCs when possible.

SECTION 24. TRAFFIC PATTERN:

24.1 Every Aircraft before landing and after takeoff shall be flown as directed by ATC.

SECTION 25. TAKE-OFFS AND LANDINGS:

25.1 No aeronautical activity shall be conducted at SCLA except in conformance with current Federal Aviation Regulations, State of California law and regulations, and these Rules and Regulations.

25.2 All initial takeoffs shall commence at the end of the Runway unless cleared by the ATC Tower.

25.3 Due to the complex mix of Aircraft that utilize SCLA, there is need to limit those type of aircraft and aerial activities that represent a potential hazard to normal flight operations. The following aircraft and aerial activities are restricted from operating at SCLA except in emergency situations or with prior approval of the Airport Director:

1. Hot Air Balloons;

2. Hang Gliders;

3. Parachutists;
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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

4. Radio Controlled Aircraft;

5. Ultra Light Aircraft;

6. Gliders; and

7. Motorized Lighter than Air Aircraft.

SECTION 26. AIRCRAFT FUELING AND DEFUELING:

26.1 In accordance with the regulations from the National Fire Protection Association (NFPA), Uniform Fire Code (UFC), and the Department of Transportation (DOT) the following rules and regulations must be observed while fueling aircraft:

26.2 All fuel servicing must be done outside of any building or hangar. (NFPA 407 3-10).

26.3 Aircraft shall be located a minimum of fifty (50) feet away from any building openings, doors, windows, etc.

26.4 During fuel handling, no passenger shall be permitted in or on the Aircraft unless a cabin attendant is stationed at or near the cabin door.

26.5 Fueling shall not be done while an on-board engine is operating (“hot fueling”) without the permission of the Airport Director and then, it shall only be permitted when representatives of the Fire Department are standing by.

Exception is allowed for A.P.U. operation on large aircraft. (NFPA 407 3-5.1)

26.6 Equipment other than Aircraft service equipment shall not be permitted within fifty (50) feet of an Aircraft during fueling or defueling. (NFPA 407 3-

5.1)

26.7 No open flames, smoking, battery chargers, or any material or device which is likely to cause a spark shall be in use within fifty (50) feet of an Aircraft or fueling truck during fueling or defueling operation. (NFPA 407 3-7, 3-8).

Exception is allowed for Ground Power Units.

26.8 All hoses, funnels and appurtenances used in fueling or defueling activities shall be equipped properly with grounding and bonding devices to prevent possible static ignition of volatile liquids or vapors. Such grounding and bonding devices shall be used during all fueling and defueling activities.

26.9 Refueling vehicles, fuel hoses and defueling equipment shall be maintained in a safe, sound, operational and non-leaking condition.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

26.10 Gravity (hand) fueling may not be accomplished with any container having a capacity greater than five (5) US gallons. (NFPA 407 3-2.3)

26.11 All portable fuel containers must be approved and marked so as to identify the product contained therein. (UFC)

26.12 Any fuel transported by privately owned vehicles, not specifically designed for the transport of flammable liquids and appropriately placarded, are limited to a maximum of 20 U.S. gallons in an approved and marked container. (DOT and UFC)

26.13 Portable fuel containers shall be kept in approved locations, at least fifty (50) feet from any building, and secured in a cabinet or locker marked “Flammable.” (UFC)

26.14 Every Person engaged in aircraft fuel handling shall exercise due care to prevent the overflow of tanks and spilling of fuel. Fuel spills are a fuel operator’s responsibility.

26.15 Where there has been a fuel spill or leak, no Person shall start the engine of any Aircraft in close proximity until the spill or leak has been cleaned up. In event such spills or leaks are over 10 ft. in any direction, or over 50 sq. ft. in area, or continues to flow, or are otherwise a hazard to persons or properties, the SCLA Fire Department & Haz-Mat shall be notified.

26.16 In addition, all fuel storage on the Airport shall be regulated by NFPA 407, the UFC, and be approved by the City of Victorville Fire Chief or his designee.

SECTION 27. VEHICLE OPERATIONS:

27.1 No Person shall travel on any portion of the Airport except upon the roads, walks, or places provided for the particular class of traffic, nor occupy the roads or walks in such manner as to hinder or obstruct their proper use.

27.2 Unless escorted by an Authorized Person who is authorized to drive on the AOA, no Person shall operate a Vehicle on the Airport without successfully passing the SCLA driving test, being issued a Personnel Identification Badge, and possessing a valid state driver’s license, with the exception of the Airport ARFF, or Law Enforcement.

27.3 No Person shall operate a powered industrial vehicle without a Driving Permit on the Ramps, Taxiways, Runways or designated Roadways. An exception will be made for employees working within the exclusive leaseholders premises as authorized by the Airport Director.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

27.4 Persons who employ Individuals at the Airport shall be responsible to provide training for powered industrial vehicles and equipment, and for maintaining all training materials and records relating to the employee’s duties.

27.5 SCLA requires that employers "certify" that training and evaluations have been completed and maintained in the employee’s files up to 180 days upon separation of employment, and are available for inspection by the FAA, TSA and the Airport Operations and Security Department upon request.

27.6 Motor-vehicle traffic shall yield the right-of-way to Aircraft.

27.7 Every vehicle, excluding ARFF and construction vehicles operating within the Movement Area, shall have a flashing yellow beacon and carry a 2-way radio or be escorted by a vehicle so equipped. Construction vehicles must be identified with an orange and white flag and a 2-way radio or be escorted by an authorized vehicle so equipped.

27.8 Any accident, involving a motor vehicle, which results in a fatality or injury, or in property damage, shall be reported by the driver, or his representative, to the Airport Director.

27.9 No Person shall operate any motor vehicle on the airport in excess of 25 miles per hour except emergency vehicles responding to an emergency situation, or emergency vehicles involved in training or drills with prior ATC coordination. On passenger loading ramps, around parked Aircraft, and in areas immediately adjacent to hangars, speed shall not exceed ten (10) miles per hour.

27.10 Vehicles shall not be parked on the Airport other than in the manner and locations indicated by posted traffic signs and markings.

27.11 Unattended Vehicles may be parked only in designated Airport vehicle parking lots.

27.12 Vehicles parked other than specified in “27.10” and “27.11” above, may be moved by Airport personnel, and in such event a towing charge will be levied prior to releasing the Vehicle from impound. Neither SCLAA, VVEDA, the City, nor any of their respective officers, employees, agents, or designated representatives shall be liable for damages sustained by such Vehicles during said movement.

27.13 Motor vehicles shall not be driven on or across Runways or other portions of the Movement Area without permission from ATC Tower to do so. Two-way radio communications with Ground Control (on frequency 124.45) shall be required between the ATC Tower and such vehicles. Exceptions may be granted during maintenance activities as long as two-way radio Pg.16 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS communications control is maintained with at least one vehicle controlling the activity. ARFF vehicles may contact the ATC tower on the fire net per operational agreement.

27.14 Motor vehicles shall not be driven or parked upon, or within fifty (50) feet of Aircraft parking areas, ramp areas, or aprons without express approval of the Airport Director. Exceptions: aircraft support, airport maintenance, emergency vehicles, or fuel or service vehicles.

27.15 No Person may operate a motor vehicle or Aircraft in or on any portion of the Airport while under the influence of alcohol or drugs.

27.16 No Vehicle shall be operated on the Airport unless the Vehicle has been registered to drive on the Airport with Airport Operations. To register a Vehicle to drive on the Airport requires: a) proof of ownership, b) proof of vehicle registration with the Department of Motor Vehicles for State of California, or the Department of Motor Vehicles for another State; and c) proof of insurance as set forth in Section 37 of these Rules and Regulations.

27.17 Vehicles passing through electronic access perimeter security gates are required to stop just past the gate and wait for the gate to fully close before continuing. Vehicle operators should ensure no unauthorized persons enter the AOA while the gate is closing. Vehicle entry procedure is one vehicle per gate activation unless the vehicles following are under Escort.

SECTION 28. FIRE HAZARDS:

28.1 No Person shall light or smoke any cigarette, cigar, pipe, or similar object in the following Airport areas:
i. Within any hangar, or fuel handling or fuel storage areas; ii. Inside any Aircraft (whether or not such Aircraft are parked or stored) or within fifty (50) feet thereof;
iii. Within fifty (50) feet of any "No Smoking" sign posted; iv. Within any Vehicle operating on the AOA;
v. Within any building on the Airport.

28.2 No Person may use flammable liquids, solvents, or substances to clean any Aircraft, engine, part, or accessory thereof, within any hangar or building except a building specially designed for that purpose and approved in writing by the Airport Director. Such approval shall only be granted when the Airport Director approves the ventilation provisions, fireproofing, and fire-extinguishing equipment.

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28.3 No Person shall light or use any open flame for any purpose in any hangar or other building on the airport without the prior written consent of the Airport Director and Fire Chief.

28.4 No Person shall operate any welding or cutting equipment (electric or gas) anywhere on the Airport without prior written approval of the Airport Director and the SCLA Fire Department. A welding permit is required and may be obtained at the fire station.

28.5 No Person shall clean or degrease any Aircraft or part thereof except at or in a maintenance station properly equipped for such purposes, or in a space designated or authorized by the Airport Director.

28.6 No Person shall store or stock any material or substance, or lease or permit such activities in or on the Airport in such a manner, or of such nature, as to constitute a fire hazard. No Person shall keep, store or discard any flammable liquid, gas, signal flare, or other flammable material in any hangar, shop, building, room, enclosure, or other place on the Airport except in areas specially designated by the SCLA Fire Department for such purpose.

28.7 Lessees of hangars, shops, or other Airport areas shall provide suitable metal receptacles with hinged lids for the storage of oily waste, rags, and other similar rubbish. The lessee shall remove all such materials at frequent intervals.

28.8 Every lessee shall maintain his leased area clean and reasonably free of oil, grease, waste, other flammable materials and weeds.

28.9 Lessees shall provide, and maintain in proper working order, adequate and readily accessible fire extinguishers. Each such extinguisher shall bear a suitable tag, which indicates the most recent date of inspection or servicing.

SCLA Fire Department shall approve all extinguishers, their type, and location.

28.10 No Person shall move, relocate, or otherwise disturb any wheeled fire extinguisher on the Airport without the permission of the SCLA Fire Department unless specifically for emergency use.

28.11 All fires on the Airport, regardless of size, even if extinguished, shall be immediately reported to the SCLA Fire Department without delay.

SECTION 29. FUEL SALES:

29.1 No Person shall deliver aviation fuels or lubricants to, or dispense such fuel from, at, or upon the Airport without a lease or permit from the Airport Director.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

29.2 For the right, privilege and concession of making deliveries of all types of aviation fuels and lubricants, and other fuels, to any Person or location at or upon the Airport, other than to a central fuel person or location at or upon the Airport, other than to a central fuel service stand provided by the Airport, there is levied against such lease or permit holder, a flowage fee of ten cents (.10) for each gallon of fuel so delivered.

29.3 No fuel shall be stored anywhere on the Airport except approved by the Airport Director and the SCLA Fire Department.

SECTION 30. SECURITY:

30.1 Though not required, SCLA operates under the guidelines established by FAR Part 139 “CERTIFICATION AND OPERATIONS SERVING CERTAIN AIRCRAFT OPERATORS.” To this end, SCLA has prepared and implemented a security program that parallels the requirements contained in TSA 1542. This program includes the following elements: Personnel Identification Badging, controlled access to the Air Operations Area (AOA), driver licensing for personnel operating on the AOA, Vehicle registration, and perimeter security. All personnel operating at SCLA are required to abide by the SCLA Airport Master Security Program.

30.2 Personnel Identification Badges. Only those Individuals that have a need to be on the AOA will be issued a Personnel Identification Badge and granted unescorted access to the AOA and Restricted Areas. Individuals that require access must apply for a Personnel Identification Badge at the Airport Operations and Security Department. Lost or stolen Personnel Identification Badges must be reported to the Airport Operations and Security Department immediately. The application process includes:

1. A ten-year employment/education or unemployment history verification check, with five years verified by the Individual’s former employer(s), and

2. A CHRC, which is information gathered from the Federal Bureau of Investigation, provided to SCLAA after submitting a Live Scan Fingerprint to the Transportation Clearing House.

30.3 Fingerprints are collected by the Airport Security Coordinator, or his designated representative, at the expense of the Individual’s employer.

30.4 A Fingerprint-based Criminal History Records Check as described in TSA 1542.209 is required before authorized unescorted access to the Airport is granted. The results of the CHRC will be among the determining factors as to whether the issuance of a Personnel Identification Badge is granted.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

30.5 Identification for Authorized Persons contains the Individual’s photograph, name, company name, expiration date, identification number and color blocks that indicate authorized access areas granted to the badge holder.

30.6 Individuals who have a need to be within the Airport Operations Area (AOA) are required to attend an Airport Familiarization and Security Identification Display Area (SIDA) class and will be required to display a Personnel Identification Badge while operating in such areas.

30.7 The Airport Badging Office issues Non-Driving Identification Badge and Identification Badges with Driving Permit, upon completion of a SIDA Class and AOA Drivers Training and satisfactory score upon completion of a written test. Driving permits will be determined and issued in accordance with the applicant’s job related duties on the airport.

30.8 The Airport Security Coordinator will confirm or deny an applicant’s request for a badge based on verification of the CHRC and the
employment/education or unemployment history verification check, with five years verified by the employer, and the need of the applicant to access the AOA. If a Personnel Identification Badge is warranted, the Airport Security Coordinator, or his designated representative, will issue the Badge.

30.9 All Personnel Identification Badges issued by the Airport Operations and Security Department are the property of Southern California Logistics Airport Authority and MUST be returned upon expiration, separation of employment (for any reason), when the job function no longer requires Personnel Identification Badge, and upon demand of staff from the Southern California Logistics Airport. Any misuse or willful failure to return a Personnel Identification Badge is punishable by fine as dictated in the Airport Rules and Regulations. Personnel Identification Badges are non- transferable and must be used only by the Individual to whom they are issued.

30.10 No Individual shall enter the AOA of the Airport without a Personnel Identification Badge unless the Individual is accompanied by an Authorized Person with a Personnel Identification Badge who shall be fully responsible for the unbadged person being escorted. Fire department personnel responding to an emergency wearing uniforms or other identifying clothing, shall not be required to wear an identification badge.

30.11 No Authorized Person shall Escort any Individual who is not in the performance of job-related duties and who requests access to the Airport as a visitor without the consent and approval of the Airport Director. Person(s) denied access to the Airport by Airport security officers, must abide by the decision of the security officers under the direction of this rule. Visitor Escort must be conducted during normal business hours of the Airport Pg.20 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Operations and Security Department, unless prior approval of the Airport Director has been established

30.12 Authorized Persons shall always prominently display their Personnel Identification Badge while on the AOA. Failure to prominently display an issued Personnel Identification Badge while on the AOA shall constitute a violation for which a fine shall be assessed as set forth in Section 43, PENALTIES AND APPEALS.

30.13 Individuals who do not display a Personnel Identification Badge, and who are not under Escort by an Authorized Person displaying a Personnel Identification Badge, shall immediately be reported to the Airport Director and shall be escorted off the AOA by the Airport Director or his staff.

30.14 Authorized Persons who have been issued a Personnel Identification Badge and are involved in an accident while operating on the AOA will be asked to submit to a drug-screening test. Authorized Persons who refuse to submit to the drug-screening test will be considered as having failed the test and the Authorized Person will be considered to be under the influence of drugs or alcohol.

30.15 Controlled Access to the AOA. Any Airport Tenant that has direct access to the AOA, should, because of their immediacy of access, be considered part of the AOA. These Airport Tenants shall therefore take measures to protect access to the AOA. As required by TSA 1542.113 Airport Tenant Security Programs, the Airport Tenant must assume responsibility for specified security measures of the Secure Area, AOA, or SIDA. Airport Tenants are encouraged to develop individual security programs designed to meet the needs of their particular businesses. In all cases such security programs must be approved in writing by the Airport Director.

30.16 While on the AOA, customers and clients of the Airport or Airport Tenants must be under Escort at all times. Failure to provide an Escort may constitute the issuance of a Notice of Violation that could result in sanctions.

See Section 43, PENALTIES AND VIOLATIONS for a discussion on the scope of fines/penalties associated with violations of the Airport Security Program.

30.17 The Airport Operations and Security Department administers the licensing program for drivers on the AOA. This program involves a study element that describes the procedures for driving on the AOA at SCLA. A written test will be administered and all applicants must pass the test in order to receive a license to drive on the AOA.

30.18 Vehicle Registration for driving on the AOA. All Vehicles that operate on the AOA must be registered with the Airport Operations and Security Pg.21 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Department. All Vehicles that operate on the AOA will be issued a Radio Call Sign that must be utilized while on the AOA. Airport Standard Operating Procedure No. 200-01 describes the Radio Call Sign Procedure.

30.19 Perimeter Security. The Airport is surrounded by an eight-foot (8’) high chain link fence. Barbed wire is placed atop this fence. There are numerous locked gates that access the Airport perimeter. Airport Tenants that are situated on the immediate perimeter of the AOA must employ secured personnel doors.

30.20 All Persons that operate on the Airport are charged with the responsibility of maintaining the security of the Airport. To this end, Persons who observe breeches in security are to call said incidents to the attention of the Airport Operations and Security Department.

30.21 A Person’s responsibility under Section 30.20 includes breeches to the procedural elements of the Airport Security Program, as well as the physical elements of the Airport Security Program (perimeter fence, vehicle gates, etc.).

30.22 The issuance under this Section of either (i) a Personnel Identification Badge, or (ii) a Personnel Identification Badge with Driving Permit to drive on the AOA, shall be conditioned upon the express consent of the Individual to whom the badge is issued, to a drug and alcohol screening in the event that such Individual is involved in an accident while on Airport property.

30.23 In the event that an Individual to whom a Personnel Identification Badge or Personnel Identification Badge with Driving Permit has been issued (a) tests positive for the use of a controlled substance not prescribed by a physician or has a blood alcohol content equal to or in excess of .08, or (b) refuses to consent to a drug and alcohol screening, then such Individual’s Personnel Identification Badge and/or Driving Permit shall be revoked by the Airport Director.

30.24 A Personnel Identification Badge and/or Driving Permit which has been revoked under Section 30.23 of these Rules and Regulations will remain revoked until the Individual’s employer petitions the Airport Director in writing, to have said Individual’s Personnel Identification Badge and/or Driving Permit reinstated.

30.25 Reinstatement of a Personnel Identification Badge and/or Driving Permit which has been revoked under Section 30.23 of these Rules and Regulations remains the prerogative of the Airport Director; however, reinstatement will not be unreasonably withheld.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

30.26 Reinstatement of a Personnel Identification Badge and/or Driving Permit which has been revoked under Section 30.23 of these Rules and Regulations will depend on, as a minimum, the employer’s verification of a negative drug test as part of a return to duty test. Any Individual who has verified positive drug test results on two drug tests will not be permitted to thereafter work or drive on the AOA, regardless of whether such Individual is accompanied by an Individual properly in possession of a Personnel Identification Badge and/or Permit.

SECTION 31. AIRPORT SECURITY AREAS:

31.1 Unauthorized Entry and Exit: No Person shall seek entry to or exit from Airport Security Areas except through designated entrances and exits. No Individual shall seek entry to or exit from Airport Security Areas over, under or through fencing, walls, window, air or other vents.

31.2 Only Authorized Persons, or those Individuals under Escort, shall have access by any means to Airport Security Areas.

31.3 A Person performing an Escort must, at all times, be in a position to actively monitor, direct and control the movements and actions of the accompanied Individual(s).

31.4 No Individual shall enter/exit or allow another Individual to enter/exit into Airport Security Areas except by using his Personnel Identification Badge.

No Individual shall follow another Individual into an Airport Security Area without first using his or her Personnel Identification Badge through any electronic access installed at the entry/exit point. This provision does not apply to an Individual under Escort

31.5 No Individual shall drive a Vehicle into Airport Security Areas unless the Individual has used his or her Personnel Identification Badge to open any electronic access installed at the entry point. No Individual shall allow other Vehicles to follow or tailgate in Airport Security Areas. This provision does not apply to Vehicles under Escort.

31.6 No Person shall tamper with or in any way hamper the effective operation of Security Devices.

31.7 Security of Access Points: No Person shall leave open, propped or unsecured any door, gate or access point leading to or allowing access to Airport Security areas. No Person shall hold, prop or cause a door, gate or access point to be open beyond the period of time allowed by a Security Device unless an Authorized Person attends the door. When an Authorized Person is attending a security door, he or she must be physically present at the door and must use his or her Personnel Identification Badge to activate additional time for the door to be open.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS SECTION 32. RESPONSIBILITY OF AIRPORT TENANTS:

32.1 Adherence to the Security Rules and Regulations: Airport Tenants with access to Airport Security Areas on their leased area shall follow these Rules and Regulations by posting signs, approved by the SCLAA, which prohibit access into the Airport Security Areas. Airport Tenants with access to Airport Security Areas shall at all times keep the access secured or staffed in a manner that prevents unauthorized Individuals from accessing Airport Security Areas. Airport Tenants shall retain keys or other means of access to Airport Security Areas under their control and issue such access only to Authorized Persons.

32.2 Airport Tenants with access to Airport Security Areas shall appoint at least one employee of the Airport Tenant as the security contact primarily responsible for the Airport Tenant’s leased area which access Airport Security Areas. Airport Tenants shall advise the Airport Security Coordinator in writing of the Individual or Individuals at all times having such responsibility.

32.3 Airport Tenants must provide a quarterly employee roster to the Airport Operations and Security Department in the months of January, April, July and October, and immediately notify the Airport Operations and Security Department of employee separation.

32.4 Airport Tenants must immediately confiscate Personnel Identification Badges, with or without access media, as well as any keys that would allow access to the Airport, from Individuals upon separation of employment. Any misuse or willful failure to return a Personnel Identification Badge is punishable by fine as dictated in these Rules and Regulations.

SECTION 33. OTHER PROHIBITED ACTS:

33.1 Bypassing Security Screening Area: No Individual shall enter a Sterile Area through a Security Screening Area unless first going through equipment that has been installed for inspection of Individuals and their belongings. Armed federal and local law enforcement officers on official duties at the Airport, airport operations and maintenance personnel, and others exempted by the FAA do not have to be inspected, provided they follow FAA and TSA regulations.

33.2 Statements Against Aviation Safety or Security: No Person shall make a statement to another so as to indicate that the Person or another may have possession of a firearm, bomb or explosive device while at the Airport.

33.3 Interference with Airport Personnel: No Person shall intimidate, threaten, hinder or obstruct Airport Personnel or Airport Security Officers in the performance of his or her official job duties or lessen the ability of such person to perform his or her duties.

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33.4 Interference with Flight Operations: No Person shall intimidate, threaten, hinder or obstruct an aircraft crewmember in the performance of his or her official job duties or lessen the ability of such aircraft crewmember to perform his or her duties.

33.5 Unattended Baggage: No Person shall leave any bag, luggage, box or container unattended in the terminal areas of the Airport, which are accessible to the public.

33.6 Presenting a Weapon at Security Screening Area: No Person shall place firearm(s), explosive device(s), knife/knives or other FAA/TSA prohibited items that could be used as a weapon onto inspection equipment at a Security Screening Area without first declaring such item(s). Only Persons authorized by the TSA may test Security Screening Areas.

SECTION 34. ENFORCEMENT:

34.1 Notices of Violation: The Airport Operations and Security Department will conduct inspections and enforce violations of these Rules and Regulations, Minimum Standards, and any permits issued hereunder regarding activities at the Airport. All Personnel Identification Badge holders and persons with access cards will be subject to a Notice of Violation (NOV) when reasonable grounds exist to believe that Rules and Regulations, Minimum Standards or a permit have been violated, either by commission or omission.

34.2 NOV’s will be monitored and issued by Airport Operations and Security Department personnel or by recommendation from an Authorized Person of Authority. A copy of the NOV will be given to the Personnel Identification Badge holder, or the Person(s) observed committing the violation(s).

34.3 The NOV may serve as a notice only or may include a penalty ranging from suspension to revocation. Any violation of a severe nature as determined by the Airport Director will warrant immediate suspension or revocation of the Personnel Identification Badge. Severe violations include, but are not limited to, any violation that may result in property damage, injury, runway incursions, or other safety hazards, or that threatens the environment or public welfare.

34.4 The receipt of three (3) NOVs, which have not been appealed or that have been upheld upon appeal, within a twenty-four (24) month period will be considered grounds for revocation of the Personnel Identification Badge.

34.5 When an NOV or sanction is issued, a letter indicating as such will be sent to the Individual’s employer, advising the employer of the violation.

34.6 Upon written request, the Airport Security Coordinator may review and recommend modification of the NOV.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS SECTION 35. SUSPENSIONS:

An Individual’s authorization to use a Personnel Identification Badge may be suspended for any of the following reasons:

1. 2.

Violation of these Rule and Regulations.

Violation of any rule or regulation of SCLAA for which a criminal penalty may be imposed.

3. 4.

Violation while on Airport property of any law of the State of California or the United States for which a criminal penalty may be imposed.

Actions which interfere with or threaten the operation of the Airport, or the comfort, safety or convenience of passengers, Authorized Person’s employed by the City of Victorville, or otherwise constitute just cause for suspension.

35.2 The Airport Director or an Airport Security Coordinator shall issue written notice of the Suspension, which shall state the nature and date of the violation, the length of Suspension, and the date the Suspension shall begin and the Individual’s right to have a hearing pursuant to the provisions of Section 43 of these Rules and Regulations. The suspension may be for up to ninety (90) days as determined by the Airport Director or the Airport Security Coordinator.

SECTION 36. REVOCATION:

36.1 An Individual’s authorization to use a Personnel Identification Badge may be revoked for any of the following reasons:

1. Any act that seriously endangers property or Persons or indicates willful or reckless disregard for, and which has an immediate impact on the health, safety or welfare of the public or poses a serious threat to the security of the Airport.

2. A violation warranting Suspension where the Individual has had a previous suspension for the same or similar offense.

36.2 The Airport Director or Airport Security Coordinator shall issue a written notice of Revocation, which shall state the nature and date of violation, the date and Revocation shall begin, and the Individual’s right to a hearing pursuant to the provisions of Section 43 of these Rules and Regulations.

SECTION 37. LIABILITY INSURANCE:

37.1 Every Airport User shall carry insurance as required by their lease, sublease or permit to operate on Southern California Logistics Airport and as required Pg.26 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS by State and Federal regulations. Any person operating a vehicle within the fenced area of the Airport, who does not have a lease, sublease, or Operating Permit, is required to have comprehensive automobile insurance with combined single limits for bodily injury and property damage of not less than $1,000,000.

37.2 Airport Users shall provide Certificates of Insurance naming VVEDA, SCLA and Stirling Airports International as Additional Insured’s with respect to their lease, sublease or permit. These Certificates of Insurance shall also provide for a 30-day Notice of Cancellation for those policies listed on the Certificate of Insurance.

37.3 The Airport User shall formally advise its Insurers that all Vehicles in use with or without valid Airside Vehicle Permits are intended to be operated on that portion of the Southern California Logistics Airport premises known as Airside, and should those Insurers exclude, limit, or otherwise restrict coverage while the Vehicle is on Airside, the Occupant shall obtain and keep in full force and effect at all times, a policy of Aviation Liability insurance covering both license-plated and unlicensed plated Vehicles while on Airside
SECTION 38. ILLEGAL ACTIVITIES: No Person shall:

38.1 Take or use any Aircraft, aircraft parts, instruments, or tools pertaining thereto, which are owned, controlled, or operated by any other Person, while such Aircraft, parts, instruments, or tools are stored or otherwise left on SCLA, or within its hangars, building, or facilities, without the written consent of the owner/operator thereof, except upon satisfactory evidence of the right to do so duly presented to the Airport Director, or authorized by him or so ordered by a court of competent jurisdiction.

38.2 Land, takeoff, taxi, or otherwise operate any Aircraft on, at, or from SCLA when he knows such Aircraft is not operating properly, or is equipped with any part or safety device which is defective or unsafe. Deviations from this restriction shall only be permitted by specific authorization from the Airport Director and/or FAA if required, or his designated representative.

38.3 Operate any Aircraft on or at the Airport, or on any Runway thereof, when the Airport or Runway has been closed to traffic by the Airport Director or other legal authority, or when such closure has been indicated by the placement of an "X" at each end of the closed Runway.

38.4 Operate any aircraft on, at, or in the vicinity of SCLA in willful or wanton disregard for the safety of persons or property, whether his own or that of others.

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38.5 Engage in the performance of any aerobatics, stunt, or maneuver not necessary to a normal takeoff, landing, normal turn or level flight of the Aircraft, over or within one mile of the exterior boundaries of the airport without the permission of the Airport Director or ATC.

38.6 Engage in the sale of any goods, wares, merchandize, or services at or upon the Airport without first having secured from the Airport Director a lease or permit therefore, and paying any required fees for such lease or permit.

38.7 Board an aircraft at the Airport without the prior approval of the Aircraft’s owner or representative.

SECTION 39. AIRPORT CLOSURE:

39.1 The Airport Director is hereby directed and authorized to close the Airport, or portions thereof, or suspend operations related to the landing, takeoff, or taxiing of Aircraft during any period in which he determines that such operations, or their continuance, would be hazardous.

39.2 Causes for such closure could include, but would not be limited to, adverse weather conditions, runway maintenance or repairs, runway obstacles, fire, Aircraft or other accident.

39.3 The Airport Director or his designee shall immediately notify the Riverside Flight Service Station and issue a NOTAM, advising of the closure.

SECTION 40. THRU-THE-FENCE ACTIVITIES:

40.1 Thru-the-fence activities, defined as accessing the Airport from private land outside the airport perimeter for the purpose of utilizing or otherwise benefiting from the Airport, are strictly prohibited.

SECTION 41. SEVERABILITY:

41.1 Should any article, section, sub-section, sentence, clause or phrase of these Rules and Regulations be held invalid or unconstitutional for any reason, such decision shall not affect the remaining portion of these Rules and Regulations.

41.2 The SCLA Authority hereby declares that it would have adopted these Rules and Regulations and each article, section, sub-section, sentence, clause or phrase, regardless of the fact that any one or more articles, sections, sub- sections, sentences, clauses, or phrases be declared invalid or unconstitutional.

SECTION 42. DISMANTLING AIRCRAFT:

42.1 No Person shall dismantle an Aircraft of any type outside of a hangar unless they receive prior written approval from the Airport Director. Any Person permitted to dismantle an aircraft outside of a hangar must:

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42.2 Submit a written request to the Airport Director describing the type of aircraft to be dismantled, the dismantling procedures to be employed, the procedures for disposing of all dismantled material, toxic material clean up and abatement procedures, and the schedule for dismantling an aircraft.

42.3 Conduct all aircraft dismantling within a fenced in area to prevent visual contact with the dismantling activity.

42.4 Return the area used for dismantling to its original condition as approved by the Airport Director in his/her sole discretion.

42.5 Procure a performance bond to ensure any contamination, remediation of contamination and the dismantling area is returned to its original state. The amount of the bond will depend upon the procedures set forth in the request and the potential exposure and land clean-up cost to the Airport.

42.6 Receive the prior approval of the SCLA Fire Department.

42.7 Adhere to all City of Victorville, State and Federal environmental regulations.

42.8 Upon receipt of the information set forth in 42.1 through 42.7 above, the availability of land to conduct dismantling and other airport operating requirements and/or constraints, the Airport Director will either approve the Aircraft dismantling request by issuing a written Letter of Permit with appropriate indemnities and airport protection provisions to the requesting person or business or deny the request by providing a Letter of Denial to the requestor.

SECTION 43. PENALTIES AND APPEALS:

43.1 Fixing penalties for violations: Any Airport User including, without limitation, sublessees, suppliers, contractors, guests, invitees, or others that do not adhere to or violates these Rules and Regulations shall be sanctioned.

43.2 Sanctions may include, but are not limited to, a fine paid to the Airport, denial of the use of the Airport for a specified period of time, and/or a referral to the Transportation Security Administration and/or Airport Authority Attorney with a recommendation for criminal prosecution.

43.3 In determining the sanctions to be imposed, the Airport Director may take into consideration any mitigating or aggravating factors that may exist including, without limitation, the number of previous violations and the cooperation of the person involved.

43.4 Fines shall be assessed from $100.00 to $10,000.00 per day per incident depending on the severity of the violation.

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43.5 Should an infraction occur, and should the infraction and situation surrounding the infraction warrant, fines will be assessed on a graduated/increasing basis.

43.6 All fines assessed to a sublessee, or to a sublessee’s suppliers, contractors, guests, invitees, or others, will be added to a Sublessee’s monthly rent and subjected to late fees and default provisions as set forth in a Sublessee’s land or facility Sublease.

43.7 Fines assessed to Airport Users who do not have a land or facility Sublease at SCLA, shall be paid before the Airport User is permitted to use the Airport again.

43.8 Continuous violation of these Rules and Regulations shall result in denial to use the Airport. Attachment B provides an example of fines as may be applied.

43.9 Removal from Airport Premises: The Airport Director, or his designated representative, may order removal of anyone from the Airport who knowingly and willfully violates any provision of these Rules and Regulations.

43.10 Recourse under Tenant’s Lease: SCLAA may take action against Airport Tenants under their lease agreements irrespective of any other penalties under these Rules and Regulations.

43.11 RIGHTS OF APPEAL: Fines and other sanctions may be appealed to the Executive Director. Requests for appeal must be made in writing to the Executive Director within ten (10) business days from the date the fine was presented to the Airport User.

43.12 The Executive Director (or his designated representative) will convene an administrative hearing and shall serve as the hearing officer (the “Hearing Officer”). Failure of any Airport User to properly file an appeal shall constitute a waiver of its right to an administrative hearing and adjudication of the fine or any portion of the total amount of the fine.

43.13 The Airport User or other Person in receipt of the fine or sanction shall be provided a written notice of the date, time, and location of the hearing. The notice will include the date, time and nature of the alleged violation.

43.14 The hearing shall be conducted in an informal manner and strict rules of evidentiary procedure will not apply. The Hearing Officer may consider any evidence that is reasonably probative and aids in the determination of the facts.

43.15 Parties are entitled to be represented by an attorney of their choice, to bring witnesses, and present documentary evidence. Parties have the right to have Pg.30 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS all records or documents relevant to the proceedings provided to them at the cost of reproduction.

43.16 At the conclusion of the appeal hearing, and pursuant to the Hearing Officer’s authority, the Airport Director’s imposition of sanctions may be upheld, modified or reversed. Parties will be provided with the results of the hearing in writing, including any penalties imposed by the Hearing Officer. The decision of the Hearing Officer is final.

SECTION 44. EFFECTIVE DATE

44.1 These changes contained in the Southern California Logistics Airport Rules and regulations shall be of full force and effective immediately upon filing of same with proof of publication with approval of the Southern California Logistics Airport Authority.
____________________________
Peter R. Soderquist
Airport Director
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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Attachment A

SOUTHERN CALIFORNIA LOGISTICS AIRPORT
Airport Rates and Charges
Introduction / Guiding Principles:

A.1 In establishing a Schedule of Airport Rates and Charges, the Southern California Logistics Airport Authority (the “Airport Authority”) is required by federal regulations to ensure that charges are fair, reasonable and non- discriminatory. Further, Airport Rates and Charges are to be reasonably consistent with the rates and charges being applied by other airports for similar types of activities, unless there is a special situation unique to the Southern California Logistics Airport.

A.2 The Airport Authority fully recognizes the FAA prohibition against the diversion of Airport revenues for non-airport purposes. It is recognized that failure to collect fair and reasonable fees and market-based rents for the use of Airport property, facilities and equipment can be considered a form of Revenue Diversion. The Authority also recognizes the FAA requirement to establish a Schedule of Rates and Charges that will permit the Airport to be as self- sustaining as possible.

Airport User Fees Defined:

A.3 Aircraft Landing Fees: The Southern California Logistics Airport Authority (SCLA) has expended a significant amount of funds to provide aviation facilities for the benefit of aircraft owners and operators. Landing fees are assessed to help offset the cost of operating and maintaining the Airport’s runway, taxiway, and aircraft parking ramp areas. Landing fees are based upon the Certified Maximum Gross Landing Weight (MGLW) of the aircraft multiplied by the Airport Authority’s established landing fee rate per 1,000 pounds of Certified Maximum Gross Landing Weight.

A.4 Commercial Aircraft: The Airport Authority assesses a landing fee on each aircraft landing conducted by an airline or other commercial Air Carrier, operating under FAR Part 121 (airline), Part 129 (international airline), Part 135 (air taxi), or other similar regulation, regardless of the purpose of the landing.

A.5 Signatory Landing Fees: Signatory landing fees are assessed to an airline, or other large (over 75,000 lbs MGLW) commercial aircraft operator having a Signatory Operating Agreement with SCLA. To be eligible for Signatory Operating Agreement status, the operator must have one or more of the following:

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS i. A lease with the Airport Authority of a ground site
having at least 10,000 square feet or more that is used to accommodate the organization’s primary base of
business on Airport property.
ii. A lease with the Airport Authority, or an approved
sublease, of a building, or part of a building totaling at least 4,000 square feet that is used as the
organization’s primary base of operations on the
Airport.
iii. Commercial Airlines operating under the military
Civilian Reserve Air Force (CRAF) program.

A.6 Non-Signatory Landing Fees: Non-signatory Landing Fees are assessed at a rate of 125% of the Signatory Landing Fee rate for large commercial operators (over 75,000 lbs MGLW) using the Airport who do not have Signatory Operating Agreement status with the Airport Authority, or have an agreement, but do not meet any of the Signatory eligibility criteria specified in paragraph 2 above. The Non-Signatory Landing Fee is intended to compensate the Airport Authority for the operator’s use of the Airport’s runway and taxiway areas as well as compensation for the privilege of being able to access the airport to conduct business.

A.7 Private Aircraft: The Airport Authority assesses a landing fee on each aircraft landing conducted by large private operators (over 75,000 lbs MGLW) operating under FAR Part 91, or other similar regulation, regardless of the purpose of the landing. Landing fees for private aircraft that are operated under FAR Part 91 and are based at the airport under conditions set forth in a long term agreement with the Authority will be charged landing fees as required by that agreement.

Aircraft Parking Fees:

A8. Signatory Aircraft Parking Fees: Aircraft having Signatory status as defined in A.1 above, are not required to pay parking fees during the time an aircraft is in the loading/ unloading process (24 hour maximum). Signatory Aircraft are also exempt from aircraft parking fees on the weekend, and over national holidays, as long as the weekend/holiday parking occurs in the middle of the loading/unloading process. Signatory Aircraft that are not in the unloading/loading process, and/or use aircraft parking areas in excess of the 24-hour maximum, are required to pay established aircraft parking fees.

A9. Non-Signatory Aircraft: Non-signatory aircraft are required to pay established aircraft parking fees.

Pg.33 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS A10. Private Aircraft: All private aircraft (both heavy and light) are required to pay aircraft parking fees. Aircraft that are based at the airport under conditions set forth in a long term agreement with the Authority will be charged parking fees as required by that agreement.

A.11 Aircraft Storage Fees: Aircraft storage fees are charged to aircraft that are stored on areas other than the main parking apron. Fees are payable under one of three different categories: under 50,000 lbs MGTW, narrow body aircraft, and wide body aircraft. Remote aircraft storage is occasioned by the many acres of closed runways and taxiways that make a suitable “hard stand” for aircraft parking. The availability of these areas is directly related to the longevity of these surfaces. As these surfaces fail to be usable for aircraft parking, they will be removed from the inventory of remote parking.

The Airport Authority makes no representation that it will maintain these surfaces and those businesses that store aircraft thereon do so at their own risk.

A.12 Fuel Flowage Fees: A substantial percentage of the fuel dispensed at SCLA is “pre-purchased” by large aircraft operators that enjoy discounts based on the large volumes of fuel these carriers purchase nationally. This pre- purchased fuel is stored in SCLA’s fuel farm to which SCLA assesses a storage fee. SCLA also assesses a flowage fee on each gallon of fuel delivered from the fuel farm to the aircraft.

A.13 Fuel flowage and fuel storage fees reflect the intent of the Airport Authority to generate reasonable revenues for the use of the airport’s fuel storage facility, while at the same time, encouraging aircraft operators to use SCLA as a base of operations.

A.14 All fuel sold at SCLA is subject to the described fuel flowage fees with following exceptions:

1. 2.

3. Non-Signatory Air Cargo Operators: Commercial Air Cargo Operators that are considered Non-Signatory as defined in Section A.1 above and pre-purchase fuel that is stored in the Airport’s fuel farm for use in their aircraft, shall pay flowage fees and storage fees.

Signatory Cargo Operators: Commercial Air Cargo Operators that meet the requirements of Signatory status as defined in Section A.1 above and pre-purchase fuel that is stored in the Airport’s fuel farm for use in their aircraft shall pay the appropriate storage fee.

Non-Commercial Signatory: Based operators (signatory) that are non-commercial (Part 91) will pay the appropriate storage fee and a modified flowage fee as provided in the operators lease agreement.

Pg.34 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Southern California Logistics Airport
Schedule of Rates and Charges
Landing Fees:

Signatory airline (over 75,000 lbs MGLW) $ .85 per 1,000 pounds MGLW Non-signatory airline (over 75,000 lbs MGLW) $1.06 per 1,000 pounds MGLW Private aircraft (over 75,000 lbs MGLW)
Fueling Fees:
$ .85 per 1,000 pounds MGLW
(Flowage fee -$ .08 per gal; Storage fee -$ .02 per gallon) Aircraft Parking Fees: (commercial aircraft)
Signatory airline
Non-signatory airline
$200.00 per day
$200.00 per day
Transient Aircraft Tie down Fees: (general aviation aircraft; main ramp) Single engine . . . . . . . . . .. . .. . . . . . .

Multi engine . . . . . . . . . . . . . . . . . . . . .
$ 5.00 per day $ 80.00 per month
$ 10.00 per day $120.00 per month
Mid-weight aircraft (12.5K lbs to 25K lbs) $ 20.00 per day $200.00 per month Large aircraft (25Klbs to 100K lbs) $ 30.00 per day$300.00 per month Narrow body . . . . . . . . . . . . . . . . . . . . .$100.00 per day $1,000.00 per month Wide body . . . . . . . . . . . . . . . . . . . . . . . $200.00 per day $2,000.00 per month Wash Rack:

Any aircraft……………………………….........$ 40.00 per hour $240.00 per day Live Scan Fingerprint Transmission Fee Per Applicant for Criminal History Records Check:

Call Airport Operations at (760) 243-1915 for Fingerprint transmission fees.

Personnel Identification Badge
Personnel Identification Badge with or without access card……….…...$ 10.00 Lost Personnel Identification Badge …………………………………….$ 100.00 (Fees are subject to change)
Pg.35 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Notes:

Parking charges for Signatory Airlines do not apply for the first 24 hours, weekends, or holidays. Transient aircraft tie down fees apply to aircraft remaining overnight. Transient aircraft remaining parked longer than overnight Military aircraft are exempt from paying landing, parking and storage fees.

Definitions:

Signatory –
Having a lease or sublease of a ground site or building space on the Airport in accordance with the Airport Authority’s Rates and Charges Policy; or, an airline having a contractual airline operating arrangement with an organization that has such a lease on airport property.

Non-signatory –
Those operators who do not have an On-Airport Lease Agreement with the Airport Authority in accordance with the Rates & Charges Policy.

MGLW – Maximum (certificated) Gross Landing Weight
MGTW – Maximum (certificated) Gross Takeoff Weight
Narrow body aircraft - i.e. B-727; B-737; DC-9; MD-80
Wide body aircraft - i.e. B747; B-777; DC-10; MD-11
Pg.36 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Attachment B
SCLA

SCHEDULE OF FINES
B.1 In most situations, a sanction or fine will be levied upon the employer of the Individual involved in the infraction. All sanctions or fines assessed will be added to the employer’s basic monthly rent and subjected to late fees and default provisions as set forth in an Airport Tenant’s land or facility sublease.

Fines assessed to Airport Users who do not have a land or facility Sublease at SCLA, shall be paid before the Airport User is permitted to use the Airport again. Continuous violation of these Rules and Regulations shall result in denial to use the Airport.

B.2 The following schedule should be regarded as a suggested schedule of fines. The Airport Director has the sole discretion and authority to levy fines, their amount and final disposition.

B.3 For minor infractions related to vehicle operations on the AOA such as:

Speeding on the AOA. $100.00
Operating a vehicle on the AOA without:

Airport Issued I’D Badge or drivers permit, appropriate markings or two-way radio communication with ATCT.

Runway incursion.

Taxiway incursion.

For negligence resulting in, and failure to correct, FOD $100.00
$500.00
$300.00
$100.00
B.4 For breeches in security such as:

1. Leaving a perimeter gate unattended.

2. Failure to accompany non-badged person on the AOA.

3. Sharing a security code or vehicle gate card.

4. Bypassing Security.

5. Sharing a Personnel Identification Badge.

6. Losing a Personnel Identification Badge.
$100.00
$100.00
$300.00
$300.00
$300.00
$100.00
B.5 For miscellaneous infractions of the Rules and Regulations such as:

1. Smoking in a non-approved area. $100.00
$100.00
$100.00
$300.00
$100.00

2. Parking or storing aircraft in non-approved areas.

3. Performing aircraft maintenance in unauthorized areas.

4. Knowingly allow an unsafe condition to exist.

5. Bringing an unauthorized vehicle on the airport.

B.6 A Federal Aviation Administration (FAA) or Transportation Security Administration (TSA) fine levied at the SCLA may be directly forwarded to a tenant if such tenant action is cause for the FAA/TSA penalty Pg.37 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS A second violation of the above listed offenses will result in the doubling of the applicable fine. A third offense will result in the tripling of the applicable fine and a suspension of privileges until corrective actions are taken and documented.

Pg.38 of 38

EXHIBIT C

SELECTED FAA RULES AND REGULATIONS
SCLAA Standard Sublease Page 26 ComAv Bldg 720, Ste 102

EXHIBIT C

SELECTED FAA RULES AND REGULATIONS

SUBLEASE PROVISIONS REQUIRED BY THE FEDERAL

AVIATION ADMINISTRATION

1. The Sublessee, for himself/herself, his/her heirs, personal representatives, successors in interest, and assigns, as part of the consideration hereof, does hereby covenant and agree “as a covenant running with the land” that in the event facilities are constructed, maintained, or otherwise operated on the property described in this Sublease for a purpose for which a Federal Aviation Administration activity, facility, or program is extended or for another purpose involving the provision of similar services or benefits, the Sublessee shall maintain and operate such facilities and services in compliance with all requirements imposed by the Non- discrimination Acts and Regulations set forth in the Pertinent List of Non-Discrimination Authorities in Provision 19 hereof (as such may be amended), such that no person on the grounds of race, color, or national origin, will be excluded from participation in, denied benefits of , or otherwise subjected to discrimination in the use of said facilities.

2. The Sublessee, for himself/herself, his/her heirs, personal representative, successors in interest, and assigns, as part of the consideration hereof, does hereby covenant and agree “as a covenant running with the land” that: (1) no person on the grounds of race, color or national origin shall be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities, (2) that in the construction of any improvements on, over, or under such land and the furnishing of services thereon, no person on the grounds of race, color, or national origin shall be excluded from participation in, denied the benefits of, or otherwise be subject to discrimination, (3) that the Sublessee shall use the premises in compliance with all other requirements imposed by or pursuant to the Non-Discrimination Acts and Regulations set forth in the Pertinent List of Non-Discrimination Authorities in Provision 19 hereof (as such may be amended).

3. In the event of breach of any of the above nondiscrimination covenants, Authority shall have the right to terminate the Sublease, and to reenter and repossess said land and the facilities thereon, and hold the same as if said Sublease had never been made or issued. This provision does not become effective until the procedures of 49 CFR Part 21 are allowed and completed including expiration of appeal rights.

4. Sublessee shall furnish its accommodations and/or services on a fair, equal and not unjustly discriminatory basis to all users thereof and it shall charge fair, reasonable and not unjustly discriminatory prices for each unit or service: PROVIDED THAT the Sublessee may be allowed to make reasonable and nondiscriminatory discounts, rebates or other similar type of price reductions to volume purchasers.

5. Non-compliance with Provision 4 above shall constitute a material breach hereof and in the event of such non-compliance, Authority shall have the right to terminate the Sublease Agreement and the estate hereby created without liability therefor, or at the election of the Authority or the United States, either or both said Governments shall have the right to judicially enforce provisions.

EXHIBIT C

6. Sublessee agrees that it shall insert the above five provisions in any lease/sublease agreement, by which said Sublessee grants a right or privilege to any person, firm or corporation to render accommodations and/or services to the public on the premises herein subleased.

7. Sublessee will comply with pertinent statutes, Executive Orders and such rules as are promulgated to assure that no person shall, on the grounds of race, creed, color, national origin, sex, age, or handicap be excluded from participating in any activity conducted with or benefiting from Federal assistance. If the Sublessee transfers its obligation to another, the transferee is obligated in the same manner as the Sublessee. This provision obligates the Sublessee for the period during which the property is owned, used or possessed by the Sublessee and the airport 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.

8. Nothing in the above Provisions 6 or 7 shall be construed as granting permission or consent for the Sublessee to sublease or transfer the premises subleased herein.

9. The Sublessee assures that it will undertake an affirmative action program as required by 14 CFR Part 152, Subpart E, to insure that no person shall on the grounds of race, creed, color, national origin, or sex be excluded from participating in any employment activities covered in 14 CFR, Part 152, Subpart E. The Sublessee assures that no person shall be excluded on these grounds from participating in or receiving the services or benefits of any program or activity covered by this subpart. The Sublessee assures that it will require that its covered sub- organizations provide assurance to the Authority, that they similarly will undertake affirmative action programs and that they will require assurances from their sub-organizations, as required by 14 CFR Part 152, Subpart E, to the same effect.

10. The Authority reserves the right to further develop or improve the landing area of the airport as it sees fit, regardless of the desires or view of the Sublessee and without interference or hindrance.

11. The Authority reserves the right, but shall not be obligated to the Sublessee to maintain and keep in repair the landing area of the airport and all publicly owned facilities of the airport, together with the right to direct and control all activities of the Sublessee in this regard.

12. This Sublease shall be subordinate to the provisions and requirements of any existing or future agreement between the Authority and, the United States, relative to the development, operation and maintenance of the airport.

13. There is hereby reserved to the Authority, 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 premises herein subleased. This public right of flight shall include the right to cause in said airspace any noise inherent in the operation of any aircraft used for navigation or flight through the said airspace or landing at, taking off from or operation on this airport.

EXHIBIT C

14. Sublessee agrees to comply with the notification and review requirements covered in Part 77 of the Federal Aviation Regulations in the event future construction of building is planned for the Subleased Premises, or in the event of any planned modification or alteration of any present or future building or structure situated on the Subleased Premises.

15. Sublessee, by accepting this Sublease expressly agrees for itself, its successors and assigns that it will not erect nor permit the erection of any structure or object nor permit the growth of any tree on the land subleased hereunder which would violate the obstruction height limitations as set forth in Federal Air Regulation (FAR), Part 77. In the event the aforesaid covenants are breached, the Authority reserves the right to enter upon the land subleased hereunder and to remove the offending obstruction, all of which shall be at the expense of the Sublessee.

16. The Sublessee, by accepting this Sublease, agrees for itself, its successors and assigns that it will not make use of the Subleased Premises, in any manner which might interfere with the landing and taking off of aircraft from this airport or otherwise constitute a hazard. In the event the aforesaid covenant is breached, the Authority reserves the right to enter upon the premises hereby subleased and causes the abatement of such interference at the expense of the Sublessee.

17. It is understood that nothing herein contained shall be construed to grant or authorize the granting of an exclusive right within the meaning of Section 308a of the Federal Aviation Act of 1958, as amended.

18. This Sublease and all the provision hereof shall be subject to whatever right the United States 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 non-exclusive use of the airport by the United States during time of war or national emergency.

19. The following constitutes the Pertinent List of Non-Discrimination Authorities, which are incorporated herein by this reference as if set forth in full:
• Title VI of the Civil Rights Act of 1964 (42 U.S.C. § 2000d et seq., 78 stat. 252), (prohibits discrimination on the basis of race, color, national origin); and 49 CFR part 21; • The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, (42 U.S.C. § 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 U.S.C. § 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 U.S.C. § 6101 et seq.), (prohibits discrimination on the basis of age);

EXHIBIT C
• 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, 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 U.S.C. §§ 12131 – 12189) as implemented by Department of Transportation regulations at 49 CFR parts 37 and 38;
• The Federal Aviation Administration’s Non-discrimination statute (49 U.S.C. § 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 discrimination 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 U.S.C. 1681 et seq).

EXHIBIT D

USE AND CONDITION OF SUBLEASED PREMISES
The Subleased Premises shall be used to principally serve to perform administrative duties as related to Sublessee’s maintenance, repair and overhaul of commercial aircraft, operating under a valid FAA Part 145 Certificate.

The condition of the Subleased Premises shall be established resulting from a walk- through inspection attended by both Sublessor and Sublessee during the annual routine inspection. The findings of this walk-through inspection shall be memorialized at the time of the walk-through via the SCLA Property Sublease Checklist.

SCLAA Standard Sublease Page 27 ComAv Bldg 720, Ste 102

EXHIBIT E

TENANT IMPROVEMENTS
Subject to the terms and conditions of the Sublease, Sublessor and Sublessee hereby affirm and acknowledge that the following items of work shall represent the Tenant Improvements contemplated for Building 720, Suite 102 within this Sublease. The Tenant Improvements must be approved in writing by Sublessor prior to any work being performed.

Location
Bldg 720, Ste 102
Interior
Description
Convert room number 76 to women’s
restroom.

Notes
Bldg 720, Ste 102
Interior
Upgrade to LED lighting. Throughout
Bldg 720, Ste 102
Interior
Interior Paint As needed,
where needed
Bldg 720, Ste 102
Interior
Construct access ramp on east end entrance.

Bldg 720, Ste 102
Exterior
Construct landscape strip along south side of
building.

SCLAA Standard Sublease Page 28 ComAv Bldg 720, Ste 102

EXHIBIT F

TENANT IMPROVEMENT CERTIFICATION
SCLAA Standard Sublease Page 29 ComAv Bldg 720, Ste 102 Item Number: 18
City Council / Board of Directors
Written Communications
Meeting of: February 20, 2024
Submitted By:

C. Eric Ray, Airport Director

Subject:

Standard Lease Agreement for Building 685C by and between the Southern California Logistics Airport Authority and Anduril Industries, Inc.

Recommendation:

That the Southern California Logistics Airport Authority (“SCLAA”) Board of Directors:
(1) approve entering into a Standard Lease Agreement for Building 685C (“Agreement”), by and between the SCLAA and Anduril Industries, Inc., (“Anduril”); and
(2) authorize the Airport Director to execute said Agreement; and (3) adopt Resolution No. SCLAA-24-001 amending the 2023/2024 budget increasing revenue in account 4501119A-45200 by $59,856.

Fiscal Impact:

The Agreement presented herein will generate approximately $649,905 in gross lease revenue over the initial term (March 1, 2024 – February 28, 2027). The table below outlines the fiscal impact of the Agreement.

FY 2023-2024
(March – June)
FY 2024-2025 FY 2025-2026 FY 2026-2027
(July – March)
$70,088 $212,366.64 $218,737.64 $148,712.72
The revenue associated with this Agreement increases the budgeted revenue established for Building 685 for fiscal year 2023/2024 and thereby requires an additional revenue appropriation in the amount of $59,856 in account 4501119A-45200. Resolution No.

SCLAA-24-001 is presented herein for the purpose of requesting approval of the required budget adjustment as outlined below.
5 7
0 Building 685 Original FY23/24 Budget
Revenue Expense
Account 4501119A-45200 $328,793 $0
Building 685 Revised FY23/24 Budget
Revenue Expense
Account 4501119A-45200 $388,649 $0
Future appropriations for the subject Agreement will be considered at the time the annual budget is approved.

Strategic Plan Goal:

The City of Victorville 2023-2026 Strategic Plan identifies multi-year strategic goals and various strategies to work toward achieving those goals. Goal A fosters fiscal health through disciplined long-term planning, cost control, increased revenues, and cost recovery.

Background:

Anduril Industries, Inc., is an American defense company that specializes in autonomous systems. It was founded in 2017 by inventor Palmer Luckey and a team of founders formerly with Palantir and SpaceX. Anduril has raised over $2.1 billion from some of the most renowned investors in the global technology landscape, including: Andreessen Horowitz; Founders Fund; General Catalyst; Lux Capital; Thrive Capital; Valor Equity Partners; and Elad Gil, among others. As of December 2022, the company was valued at over $10 billion.

Anduril states that at its core, it is a defense products company. Unlike most defense companies, Anduril does not sit idly waiting for its customers to tell them what they need.

Anduril identifies problems, and privately funds research and development while working to break into large programs of record and sells finished products off the shelf in order to get relevant technologies into the hands of war fighters as quickly and effectively as possible. Ideas are turned into deployed capabilities in months, not years, saving the government and taxpayers money along the way. Military veterans make up more than 20% of Anduril’s team and their defense experience is leveraged to ensure that the company’s products meet the needs of servicemen and women in the battlefield.

Anduril’s family of systems is powered by the proprietary Lattice OS, an artificial intelligence powered open operating system that brings autonomy to the Defense Department’s toughest missions. Lattice OS connects autonomous sensemaking and command and control capabilities with open, modular, and scalable hardware components for a layered family of systems approach. Some of the major systems that Anduril has deployed or publicly acknowledged to be developing are the Sentry Towers, Roadrunner, Ghost Shark XLAUV, Dive LDAUV, Altius and Fury. 5 7
0 The facility at the SCLA will support Anduril’s group 5 autonomous air vehicle program, called Fury, a single engine jet drone. Additionally Andril will perform related independent research and development and contracted efforts.

Discussion:

The proposed Agreement for Building 685C entails an initial term of three-years with a commencement date of March 1, 2024. The Agreement also contemplates one, three- year, option term. The Leased Premises consist of Building 685C which is comprised of approximately 11,168 square feet of hangar and office space, approximately 12,000 square feet of Ground Control Center Space, and 11,435 square feet of Aircraft Shade Structure Space. Anduril has agreed to pay $17,522 per month with an annual 3% inflator. This amounts to $1.50 per square foot per month for Building 685C which is a market high for Building 685C, and $.05 per square foot for the Ground Control Center Space and Aircraft Shade Structure Space.

Because the Standard Lease Agreement will increase local employment, and produce a steady revenue stream, staff recommends that Your Honorable Southern California Logistics Airport Authority Board approve the Standard Lease Agreement with Anduril Industries, Inc., for Building 685C and authorize the Airport Director to execute said agreement and adopt Resolution No. SCLAA-24-001 amending the 2023/2024 budget increasing revenue in account 4501119A-45200 by $59,856. Such approval is being requested, subject to any minor, non-substantive modifications to the Lease Agreement as approved by the Southern California Logistics Airport Authority Legal Counsel and the Southern California Logistics Airport Authority Executive Director.

Staff remains available for any questions or comments you may have.

CER/lf
Attachments: A. General Site Map
B. Standard Lease Agreement for Building 685C
C. Resolution No. SCLAA-24-001
Attachment A









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Ground Control
Center Space
Max Height 30'
+/- 12,000 Sq Ft
160'x170'
x40'x120'
Aircraft Shade
Structure Space
+/- 2,000 Sq Ft
40' x 50'
Area to be improved for aircraft shade
structure space, aircraft access &
additional vehicle parking
+/- 11,435 Sq Ft

ATTACHMENT B

STANDARD LEASE AGREEMENT
FOR BUILDING 685C

SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY

STANDARD LEASE AGREEMENT
(BUILDING 685C)
This Lease Agreement (the “Lease”), dated this _______ day of ______________, 2024, for reference purposes only, is made by and between the SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY (“SCLAA”), a California joint powers authority, (hereinafter referred to as “Lessor”) and ANDURIL INDUSTRIES, INC., a Delaware corporation (hereinafter referred to as “Lessee”). Lessor and Lessee are sometimes referred to hereinafter individually as a “Party” and collectively as the “Parties.”

RECITALS
A. The United States Air Force (“Air Force”) and the Victor Valley Economic Development Authority (“the Authority”) have previously entered into certain Department of the Air Force Leases pertaining to portions of the former George Air Force Base, which is now known as the Southern California Logistics Airport (“SCLA”) (hereinafter referred to as the “Air Force Leases”).

B. The Authority has delegated its decision-making authority with respect to the SCLA to the Lessor, which now has the authority to enter into transactions on behalf of the Authority.

C. The Air Force (“Grantor”) and the SCLAA (“Grantee”) have entered into certain Air Force Quitclaim Deed(s) (“Quitclaim Deed(s)”), which release and forever quitclaim to the Grantee all the real property described in such Quitclaim Deed(s), subject to the Covenants, Conditions and Restrictions set forth in the Quitclaim Deed(s).

D. Lessee seeks to lease from the Lessor a portion of the real property subject to the Quitclaim Deed(s) (hereinafter defined as the “Leased Premises” and described more fully below) under the terms and conditions set forth in this Lease.

E. Although the Leased Premises are subject to and governed by the Covenants, Conditions and Restrictions of the Quitclaim Deed(s), certain portions of the SCLA (some of which may include appurtenances, access/use rights, privileges and/or easements associated with the Leased Premises) are subject to the provisions and conditions of the Air Force Leases, and Lessee shall be subject to and comply with any and all provisions and conditions of such Air Force Leases as applicable.

TERMS AND CONDITIONS

1. Leased Premises. Subject to the terms and conditions herein contained, Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor the Leased Premises described as follows:

SCLAA Standard Lease Page 1 Anduril Building 685C

(a) A portion of that certain real property designated as Building 685C, located on the SCLA grounds at 18310 Readiness Street, Victorville, CA 92394, comprised of approximately: Eleven Thousand One Hundred Sixty-Eight (11,168) square feet of hangar and office space; Twelve Thousand (12,000) square feet of Ground Control Center space; and Eleven Thousand Four Hundred Thirty-Five (11,435) square feet of Aircraft Shade Structure, aircraft access, and additional parking space together with the improvements thereon, as further described on Exhibit A attached hereto and incorporated herein by this reference; and
(b) all appurtenances, rights, privileges, and easements in any way applicable thereto.

2. Term. The Initial Term of this Lease shall be for a period of three (3) years, commencing on March 1, 2024, (the “Lease Commencement Date”) and expiring on February 28, 2027, the “Expiration Date”) unless sooner terminated or extended as hereinafter provided.

3. Option to Extend Term. Upon expiration of the Initial Term, Lessee shall have the option to renew this Lease for one (1) additional three (3) year term (the “Option Term”), provided that: (1) Lessee is in good standing and otherwise in full compliance with all of the terms and conditions of this Lease; and (2) Lessee provides Lessor written notice of its desire to renew no later than one hundred eighty (180) days prior to the expiration of the Initial Term; and (3) Lessor confirms in writing Lessee’s Option Term.

Upon confirmation of such exercise by Lessor, all references to the Expiration Date shall mean February 28, 2030.

4. Termination. This Lease shall only terminate prior to the Expiration Date for such reasons as are specifically set forth in the provisions of this Lease.

5. 6.

Right to Terminate for Development.

Rent.

Intentionally Omitted.
(a) Monthly Base Rent. During the first year of the Initial Term, Lessee shall pay to Lessor as rent for the Leased Premises the amount of Seventeen Thousand Five Hundred Twenty-Two Dollars ($17,522) per month (the “Monthly Base Rent”).

Commencing on March 1, 2025, the Monthly Base Rent shall be increased by three percent (3%), and on each annual anniversary of the Lease Commencement Date thereafter during the Term (or during any Option Term exercised in accordance with the provisions of Section 3 hereof), the then-current Monthly Base Rent shall be increased by an additional three percent (3%). All further references to the Monthly Base Rent shall mean and include any such increased amount as calculated under the provisions of this paragraph. The Monthly Base Rent represents the summation of Building 685C rent in the amount of Sixteen Thousand Seven Hundred Fifty-Two Dollars ($16,752), the Ground Control Center Space rent in the amount of Six Hundred Sixty Dollars ($660), and the Aircraft Shade Structure Space rent in the amount of One Hundred Ten Dollars ($110).

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(b) Tenant Improvements. Within three hundred six (306) days of the Lease Commencement Date, Lessee shall undertake and substantially complete, at its sole expense, certain tenant improvements to the Leased Premises (the “Tenant Improvements”) as further described on Schedule A of Exhibit E attached hereto and incorporated herein by this reference. Lessee shall construct the Tenant Improvements in accordance with Section 14, 17 and 22 of this Lease, using its own staff and/or properly licensed and insured contractors and in full compliance with any applicable prevailing wage.
(c) Rent Credits. As consideration for substantially completing the Tenant Improvements described on Schedule A of Exhibit E, within the time period set forth above, and subject to the provisions of subsections i and ii hereof, Lessor shall, commencing February 1, 2025, and continuing for twenty (20) consecutive months of the Initial Term of this Lease, provide Lessee with a monthly rental credit in an amount equal to fifty percent (50%) of the cost of the Tenant Improvements described on Schedule A of Exhibit E to Building 685C. The rental credit shall be based upon actual costs incurred by Lessee to construct the Tenant Improvements described on Schedule A of Exhibit E, as verified and approved by Lessor pursuant to subsection (i) below. However, the Rental Credit shall not exceed a total of Three Hundred Thousand Dollars ($300,000) and shall be applied on a monthly basis toward the Lessee’s Monthly Base Rent in an amount not to exceed Fifteen Thousand Dollars ($15,000) monthly.
i. Following the substantial completion of the Tenant
Improvements described on Schedule A of Exhibit E, Lessee shall provide to Lessor all invoices with proof of payment, other evidence of actual cost incurred together with a cost summary cover page (the “Close-Out Statement”). Upon receipt of the Close-Out Statement, Lessor shall verify same and calculate the actual total amount of the rent credits due to Lessee.
ii. Should Lessee not substantially complete the Tenant Improvements within three six (306) days following the Lease Commencement Date (December 31, 2024) and provide a Close-Out Statement to Lessor documenting the actual costs incurred, Lessee shall not be eligible for rent credits described in Section 6 (c).
(d) Payment. Monthly Base Rent shall be payable in advance prior to the first (1st) day of each calendar month and without demand to:

Southern California Logistics Airport Authority
Attention: Airport Director
18374 Phantom West
Victorville, California 92394
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or at such other place as Lessor may designate in writing from time to time. Lessee shall also pay to Lessor within thirty (30) days of presentation of an invoice, such other charges as it may incur for use of facilities and services at the SCLA which shall be charged in accordance with the SCLA Rules and Regulations as set forth in Exhibit B, attached hereto and incorporated herein by this reference, as such may be amended from time to time by Lessor.

7. Security Deposit. Lessee shall deposit with the Lessor upon execution hereof Seventy Thousand Eighty-Eight Dollars ($70,088) as security for Lessee’s faithful performance of Lessee’s obligations hereunder (the “Security Deposit”). If Lessee fails to pay rent or other charges due hereunder, fails to pay any utility or service provider, or otherwise defaults with respect to any provision of this Lease, the Lessor may use, apply or retain all or any portion of said deposit for payment of any rent or other charges in default or for the payment of any other sum to which the Lessor may become obligated by reason of Lessee’s default, or to compensate the Lessor for any loss or damage which the Lessor may suffer thereby. The Security Deposit amount must be maintained by Lessor in the minimum amount of the Security Deposit required under this section.

8. Brokerage Commission. Lessor and Lessee represent and affirm to each other that they have not had any dealings with any real estate brokers, finders or agents and no commissions or fees are payable by either Party in connection with this Lease.

9. Late Charge. Lessee hereby acknowledges that late payment by Lessee to Lessor of any installment of rent, or any other sums due hereunder will cause Lessor to incur costs not contemplated by the Lease, the exact amount of which will be extremely difficult to ascertain. Accordingly, if any installment of rent, or any other sum due from Lessee is not received by the Lessor within ten (10) days after such amount is due, whether or not any notice of default or other notice has been given, Lessee shall pay to the Lessor a charge equal to six percent (6%) of the amount past due (the “Late Charge”), in addition to the payment of the past due amount itself. The Parties hereby agree that such Late Charge represents a fair and reasonable estimate of the costs the Lessor will incur by reason of late payment by Lessee, and no more than one (1) Late Charge shall be assessed per month. Notwithstanding the foregoing, in the event the Lessee elects to make annual payments in advance, then no Late Charge shall apply.

10. Limited Right to Possession of the Leased Premises. Lessor shall deliver possession of the Leased Premises to Lessee on or before the Lease Commencement Date, free and clear of all tenants, occupants, and right of any third parties except as hereafter provided in this Section 10. Lessee agrees that its possession of the Leased Premises shall be subject to any outstanding easements and rights-of-way not within the control of the Lessor and further to the right of entry by the Air Force and such other government entities as provided for under the Quitclaim Deed(s). The Lessor shall use best efforts to ensure the quiet use and enjoyment of the Leased Premises by Lessee.

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However, unreasonable interference by Lessor or the Air Force with Lessee’s quiet enjoyment of the Leased Premises that results in material and demonstrable financial detriment to Lessee and Lessee being unable to continue its business functions in a commercially reasonable manner, shall be grounds for termination of the Lease by Lessee.

11. Holding Over. In the event Lessee, with the Lessor’s prior written consent, holds over and continues in possession of the Leased Premises, or any part thereof, after the Expiration Date of this Lease, such occupancy shall be considered a month-to-month tenancy subject to all the terms and conditions of this Lease in effect on the day immediately preceding the Expiration Date, except that the Monthly Base Rent for any such holdover period shall be increased to one hundred fifty percent (150%) of the then current Monthly Base Rent. If Lessee, without the Lessor’s prior written consent, holds over or continues in possession of the Leased Premises, or any part thereof, after the Expiration Date of this Lease, such occupancy shall be deemed a tenancy at sufferance, permitting the Lessor to immediately commence eviction proceedings without notice to Lessee.

12. 13.

Right to Relocate. INTENTIONALLY OMITTED.

Maintenance. Except for excessive repair and maintenance necessitated solely by Lessor’s activities, Lessee shall at all times during the Term hereof and until surrender and termination, keep and maintain the Leased Premises in good and substantial order and repair, and shall undertake all necessary repair and maintenance of the Leased Premises. Lessee shall be responsible for all operating expenses associated with maintaining the Leased Premises including, but not limited to: cleaning; light bulb replacement; procurement of supplies and maintenance materials; preventative maintenance; repair; upkeep and emptying of emergency/hazardous spill trench drains and reservoir; signs; sidewalks; all monthly, quarterly, and annual inspection/servicing and repair of the Leased Premises mechanical, electrical, lighting, plumbing, and life safety systems; furniture and window cleaning; servicing of fire extinguishers and fire suppression systems; repairs to trade fixtures and/or equipment, doors, ceilings, roofing, floors; exterior painting, resurfacing paved exterior areas and the like; landscaping of parking lot, associated fees, etc. Lessee agrees at Lessee’s sole cost and expense to procure and maintain throughout the Term of this Lease, or any extension thereof, contracts for the inspection/servicing and maintenance of HVAC equipment, fire extinguishing and suppression systems, fire alarms and/or smoke detection systems, and air compressor systems with contractors selected by Lessee. Lessee also agrees throughout the Term (or any extension thereof) to supply copies of all such contracts and any fire or life safety related certifications and/or inspection records to the Lessor in a timely manner following Lessor’s written request.

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14. Use and Condition of Leased Premises. The Leased Premises are to be used by Lessee for those purposes more particularly provided for in Exhibit D, attached hereto and incorporated herein by this reference, and for no other purpose unless expressly agreed to by the Lessor in writing. Lessee agrees to use the Leased Premises in such a manner as to not interfere with the Lessor’s rights in the Leased Premises or the surrounding areas, to comply with all airport rules and regulations, all applicable governmental laws, ordinances, and regulations in connection with its use of the Leased Premises, to keep the Leased Premises in a clean and sanitary condition, and to use all reasonable precaution to prevent damage, or injury to the Leased Premises. (a) Permits. Lessee, at its sole cost and expense, shall apply for and obtain any and all permits and/or certifications required by any federal, state or local governmental entity, including but not limited to the Mojave Desert Air Quality Board, in connection with the painting, maintenance and/or overhaul of aircraft in or about the Leased Premises. Such permits shall include, but not be limited to, any which may be required for the air handling and ventilation requirements for the Leased Premises.

Furthermore, Lessee shall coordinate and cooperate with the Mojave Desert Air Quality Board as may be required from time to time. Any and all such permits and/or certifications with respect to the Leased Premises itself (rather than with respect to Lessee’s business) shall be obtained in such a manner so as to run in favor of the Leased Premises and/or the Lessor, and such permits or certifications shall remain with the Leased Premises upon the expiration or termination of the Lease.
(b) No Warranties. Except as provided herein, Lessee agrees that no promises, covenants, representations, statements, or warranties have been made on behalf of the Lessor to Lessee respecting the condition of the Leased Premises, or the manner of operating the Leased Premises or the maintaining of any repairs to the Leased Premises.
(c) Acceptance of Leased Premises. Lessee acknowledges that it has satisfied itself by its own independent investigation that the Leased Premises are suitable for its intended use, and that neither the Lessor nor the Lessor’s agent or agents have made any representation or warranty as to the present or future suitability of the Leased Premises for the conduct of Lessee’s business. Subject to the walk through with Lessor, Lessee’s taking possession or use of the Leased Premises for any purpose shall constitute Lessee’s acceptance of the Leased Premises “as-is” in its existing condition, which condition shall be established as set forth in Exhibit D. (d) Notice of Presence of Asbestos and Lead-Based Paint. Lessee, its successors and assigns are warned that the Leased Premises may contain asbestos materials and lead-based paint materials. No warranties, either expressed or implied, are given with regard to the quantity, location or condition of the asbestos containing materials or the lead-based paint materials. Lessee, its successors, and assigns, shall be deemed to have relied solely on their own judgment in assessing the overall condition of all or any SCLAA Standard Lease Page 6 Anduril Building 685C

portion of the Leased Premises, including any asbestos hazards or lead-based paint hazards or concerns. Lessee acknowledges that Lessee was given every opportunity to inspect the Leased Premises to assess the risk, if any, from asbestos containing material or lead-based paint materials.

The Lessor assumes no liability for damages for personal injury, illness, disability or death to Lessee or to Lessee’s successors, assigns, employees, invitees, or any other persons subject to Lessee’s control or direction, or to any person, including members of the general public arising from or incident to the purchase, transportation, removal, handling, use, disposition or any activity causing or leading to contact of any kind whatsoever with asbestos or lead-based paint on the Leased Premises which is the subject of this Lease, whether Lessee, its successors or assigns has or have properly warned or failed to properly warn the individuals injured. Lessee, its successors and assigns, further agree that in its use and occupancy of the Leased Premises, it will comply with all federal, state and local laws relating to asbestos and lead-based paint. (e) Personal Property. Lessee shall, at the termination of this Lease, by lapse of time or otherwise, remove all of Lessee’s personal property, repair any damage to the Leased Premises resulting therefrom, and surrender the Leased Premises to the Lessor in as good a condition as when Lessee took possession, normal wear and tear excepted.

15. Waste or Nuisance. Lessee shall not commit or permit the commission by others of any waste on the Leased Premises. Lessee shall not maintain, commit, or permit the maintenance or commission of any nuisance on the Leased Premises nor shall Lessee use or permit the use of the Leased Premises for any unlawful purpose.

16. Taxes. Lessee shall pay when due and prior to delinquency all taxes, assessments, and other charges including possessory interest taxes levied or imposed by any governmental entity on the possessory interest of Lessee in the Leased Premises and the personal property, trade fixtures, appliances, and leased equipment placed by Lessee in, on, or about the Leased Premises during the Term (or any extension thereof) of this Lease. Lessee recognizes that the interests of Lessee in this Lease shall be subject to the imposition of a possessory interest tax by the San Bernardino County Assessor, and Lessee agrees to pay such tax amount as may be so levied with respect to the possessory interest of Lessee in the Leased Premises under this Lease. Lessee further acknowledges that pursuant to California Health and Safety Code Section 33673, the property shall be assessed in the same manner as privately owned property and Lessee shall pay taxes upon the assessed value of the entire property and not merely the assessed value of its leasehold interest.

17. Compliance With Covenants, Conditions and Restrictions of the Quitclaim Deed(s), Air Force Leases and Related Agreements.
(a) Lessee acknowledges that copies of the applicable Quitclaim Deed(s) and the Air Force Leases are available and on file in the SCLA office.

SCLAA Standard Lease Page 7 Anduril Building 685C

(b) Lessee expressly acknowledges that the Lessor has assumed certain duties and obligations to the Air Force (“Grantor”) under the Quitclaim Deed(s) affecting the use and occupancy of the Leased Premises. Lessee further agrees that as of the Lease Commencement Date, it shall observe and perform the duties and obligations of the Lessor (Grantee as the case may be in this Section 17) relating to the Leased Premises in favor of the Air Force which arise under the Quitclaim Deed(s).

These duties and obligations as assumed by Lessee include, but are not limited to, the following which are presented below for purposes of reference and convenience:

I. Reserving unto the Grantor all oil, gas, and other mineral resources of any kind or nature in the mineral estate of the Leased Premises, provided, however, that such reservation is without surface right of entry or extraction rights; and II. Reserving unto the Grantor right of access to the Leased Premises, extending such access to the United States Environmental Protection Agency (“EPA”) and the State of California (the “State”), and their respective officials, agents, employees, contractors, and subcontractors for the purposes of the Installation Restoration Program (“IRP”) of the Grantor or the Federal Facility Agreement (“FFA”). (c) Lessee further expressly acknowledges that it is subject to and shall comply with all provisions and conditions of the applicable Air Force Leases. (d) Any use, occupancy or activity of Lessee on the Leased Premises which may result in either the receipt by the Lessor of a notice of violation or default or breach from the Air Force or the Federal Aviation Administration (“FAA”) under the Quitclaim Deed(s) or a notice of default, violation or breach from the Air Force or the FAA under the Air Force Leases, shall be deemed to be a default of Lessee under this Lease.

The response of the Lessor following receipt of any such notice of violation, default, or breach, shall not waive, stay or otherwise mitigate or remedy the default of Lessee to the Lessor under this Lease. Lessee shall have no right under this Lease to participate in any proceeding between the Air Force, the FAA and the Lessor for the resolution of an alleged default, breach or other dispute of the Parties arising under the Quitclaim Deed(s) and/or the Air Forces Leases, except to the extent the Lessee is alleged to have directly caused such violation, breach or default.
(e) Lessee acknowledges that the Leased Premises may be subject to a future Declaration of Covenants, Conditions and Restrictions to be recorded in the official records of San Bernardino County, California, as amended (the “CC&Rs”). In addition to any other applicable assessments, this Lease may be subject to any assessments levied pursuant to the CC&Rs and applicable to the Leased Premises, determined by the ratio that the rentable area of building on the Leased Premises bears to the total net rentable area of building or buildings which include the Leased Premises and for which a separate assessment is made pursuant to the CC&Rs.

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18. Insurance.
(a) Commercial General Liability Insurance. Lessee shall procure and maintain at its own expense, during the Term of this Lease or any extension thereof, Commercial General Liability insurance with a company or companies acceptable to Lessor, of not less than Five Million Dollars ($5,000,000) per occurrence, Ten Million Dollars ($10,000,000) in the aggregate, for bodily injury, personal injury, death, loss, or damage to property resulting from the activities conducted by the Lessee or its officers, employees, servants, volunteers, and agents and independent contractors on the Leased Premises. Such policies shall provide coverage for bodily injury, personal injury and property damage to the Leased Premises based upon, involving, or arising out of the use, occupancy or maintenance of the Leased Premises and all areas appurtenant thereto.

Lessor agrees that the required occurrence and aggregate limits shall include limits from a combination of general liability, umbrella liability and/or excess liability policies. (b) Property Casualty Insurance. Lessee shall keep in full force and effect during the Term of this Lease or any extension thereof, a policy of insurance against fire, vandalism, malicious mischief, and all other perils as are from time to time included in an “all risk” coverage endorsement insuring Lessee’s improvements constructed on the Leased Premises, if any but not any existing improvements constructed on the Leased Premises, in an amount which is at least one hundred percent (100%) of the full replacement cost. Lessee shall also be required by Lessor to maintain at its own expense insurance covering any Tenant Improvements, other improvements to the Leased Premises, Business Income/Extra Expense, Business Personal Property, Supplies, and Equipment. Lessee's policy must also include a Loss Payee Endorsement naming the Southern California Logistics Airport Authority (“Lessor”) as a “Loss Payee,” as its interests may appear with respect to the Tenant Improvements. Lessor agrees to maintain commercially reasonable property insurance with respect to the Leased Premises.
(c) Commercial Vehicle Liability Insurance. Lessee shall further procure and maintain, at its own expense during the Term of this Lease or any extension thereof, a Commercial or Business Auto Liability insurance policy covering Symbol 1 (any auto), for all owned, non-owned, leased, and hired autos, trucks, trailers, or semi-trailers, including and not limited to, any machinery or apparatus attached thereto. Limits shall be no less than One Million Dollars ($1,000,000) per accident or Combined Single Limit (“CSL”) for bodily injury and property damage.
(d) Workers’ Compensation Insurance. Lessee shall procure and maintain at its own expense, during the Term of this Lease or any extension thereof, workers' compensation insurance, providing coverage as required by the California State Workers' Compensation Law. If any class of employees employed by Lessee is not protected by the California State Workers' Compensation Law, Lessee shall provide adequate insurance for the protection of such employees to the satisfaction of the Lessor.

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(e) Additional Insured Status. The Southern California Logistics Airport Authority (“Lessor”), the City of Victorville, the City Attorney, the Victor Valley Economic Development Authority, the United States Air Force and their officers, officials, employees, servants, volunteers, agents and independent contractors are to be covered as additional insureds on the Commercial General Liability Policy (“CGL”) with respect to liability arising out of work or operations performed by or on behalf of the Lessee, including materials, parts, or equipment furnished in connection with such work or operations.

General Liability coverage can be provided in the form of an endorsement to the Lessee’s insurance.
(f) Waiver of Subrogation Rights. Lessee shall require the carriers of all required insurance policies to waive all rights of subrogation against the Southern California Logistics Airport Authority, the City of Victorville, the City Attorney, the Victor Valley Economic Development Authority, the United States Air Force and their officers, officials, employees, servants, volunteers, agents, and independent contractors. (g) Environmental Liability. If Lessee performs work that includes using or storing Hazardous Materials on the Leased Premises, insurance is also required for third party claims for bodily injury, property damage, and remediation costs stemming from pollution incidents from the Lessee's operations.
(h) Primary Coverage. For any claims related to this Lease, the Lessee’s coverage shall be primary insurance as respects the Southern California Logistics Airport Authority (“Lessor”), the Victor Valley Economic Development Authority, the City of Victorville, the City Attorney and the United States Air Force and their officers, officials, employees, volunteers, contractors and subcontractors. Any insurance or self- insurance maintained by the Southern California Logistics Airport Authority (“Lessor”), the Victor Valley Economic Development Authority, the City of Victorville, the City Attorney and the United States Air Force and their officers, officials, employees, volunteers, contractors and subcontractors shall be in excess of the Lessee’s insurance and shall not contribute with it.

19. Proof of Insurance Coverage.
(a) Lessee shall secure from a good and responsible company or companies authorized to do insurance business in the State of California the policies of insurance required by this Lease and furnish to Lessor certificates of said insurance on or before the commencement of occupancy under this Lease. Insurance is to be placed with insurers with a current A.M. Best’s rating of not less than A:VII, unless otherwise acceptable to the Lessor.
(b) The certificates of insurance shall bear an endorsement whereby it is provided that, in the event of cancellation or amendment of any required insurance policy for any reason whatsoever, Lessor shall be notified by mail, postage prepaid, not less than thirty (30) days before the cancellation or amendment is effective. In the case of non-payment, ten (10) days advance written notice shall be given.

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(c) The certificates of insurance shall indicate that the respective insurance policy will be maintained throughout the Term of this Lease, or any extension thereof.

20. Personal Property at Risk of Lessee. All personal property which Lessee maintains at the Leased Premises shall be at the risk of Lessee only. Except for the grossly negligent, reckless, or unlawful intentional acts of the Lessor, its agents, employees, guests or invitees, the Lessor shall not be liable for any damage to any property of Lessee or for any damage to Lessee’s property in moving the same to or from the Leased Premises.

21. Utilities and Other Services.
(a) Lessee shall contract with and pay the applicable provider, whether the provider is the Lessor or another party, all charges for water, gas, electricity, sewer, waste disposal, or other utilities used or supplied upon or in connection with its use of the Leased Premises and shall indemnify, defend and hold harmless the Lessor against any liability on account thereof. Lessee shall obtain separate metering devices for utility services, as applicable. Lessee agrees to promptly reimburse the Lessor upon receipt of invoice, its proportionate share of the actual cost of utility services from any common utility service, which may have been paid by Lessor. In addition to the amount of the utility bill that the Lessor may have paid, Lessee shall pay to Lessor a three percent (3%) administrative fee for any pass-through billing processed. In no event shall the Lessor be liable for any interruption or failure in the supply of any such utilities to the Leased Premises.
(b) Lessee understands that the electric, gas, and water utilities are shared with other tenant(s) of Building 685. Lessee further understands its obligation to enter into separate utility reimbursement agreements with the tenants occupying Building 685A and 685B in order to receive reimbursement from said tenants for their proportionate share of the actual cost of utility services which may have been paid by Lessee.

22. Alterations, Improvements and Additions.
(a) Lessee shall not make any alterations, improvements, or additions to the Leased Premises (collectively hereinafter the “Improvements”) without the prior written consent of the Lessor. Lessor hereby approves the Improvements listed on Exhibit E in concept but Lessor reserves the right to review, approve and consent to the actual design and construction of such Improvements in accordance with this Lease. Any machinery, equipment, or apparatus, which belongs to Lessee, may be removed by Lessee at any time prior to the expiration of the Term of this Lease or any extension thereof.

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(b) Once completed, Improvements authorized in writing by Lessor and/or any specific Tenant Improvements as may be provided for elsewhere in this Lease, shall not be removed by Lessee. At the end of the Term (or any extension thereof) of this Lease (or upon any earlier termination as may be provided for herein) the Tenant Improvements shall become the property of Lessor.

23. Airport Development. The Lessor, at its sole discretion, shall determine and may from time to time change the routes of surface ingress and egress to and from the Leased Premises, but agrees to locate such routes as conveniently as may be done for Lessee, having in mind the reasonable requirements of the Lessor with respect to the operation of the SCLA. Notwithstanding the above, if the rerouting of such ingress and egress routes significantly disrupts the normal operations of Lessee such that it results in material financial detriment to Lessee, then Lessee shall have the right to terminate this Lease.

24. Signs. Lessee shall not post, install, erect, or operate any sign, placard, poster, or other device on any part of the Leased Premises without the prior written permission of the Lessor. Such signs as may from time to time be permitted by the Lessor shall be made, posted, maintained and removed, and repair any damage caused by removal, at Lessee’s own cost and expense. Lessor shall have the right to remove unauthorized signs at Lessee’s expense. Lessee shall be responsible for all costs associated with the purchase and installation of the required Building Standard Suite Signage in accordance with local codes.

25. Liens. Lessee shall not suffer or permit any liens to stand against the Leased Premises, or any part thereof, by reason of any work, labor, services, or materials done for, or supplied to Lessee or anyone holding the Leased Premises or any part thereof through or under Lessee. If any such lien shall at any time be filed against the Leased Premises, Lessee shall cause such lien to either be discharged of record sixty (60) days after the date that Lessee receives notice of the filing. Notwithstanding the above, in any bona fide dispute between Lessee and any third party concerning work done by the third party on or for the Leased Premises, and as a result of the dispute the third party files a lien against the Leased Premises, then, in lieu of obtaining the discharge of the lien within the sixty (60) day period, Lessee, at its option, may either file suit against the third party, a part of the suit being to judicially negate or remove the lien or Lessee may file an appropriate bond or other device allowed by law to remove the lien.

26. Inspection by the Lessor. Lessee shall permit the Lessor, or its agents, representatives, or employees to enter the Leased Premises at mutually agreeable, reasonable times for the purpose of inspecting the Leased Premises to determine whether Lessee is complying with the terms of this Lease, for the purpose of doing other lawful acts that may be necessary to protect the Lessor’s interest in the Leased Premises, or for the purpose of performing the Lessor’s duties under this Lease. Except in the event of an emergency, the Lessor shall contact Lessee, no less than twenty-four (24) hours prior to the time that Lessor desires to enter the Leased Premises to arrange a mutually agreeable time for the inspection. Lessor agrees that Lessee may require that anyone SCLAA Standard Lease Page 12 Anduril Building 685C

entering the Leased Premises be accompanied by an employee of Lessee so long as such escort is reasonably available. Lessor shall use commercially reasonable efforts to minimize any disruption to Lessee’s business operations in connection with any such entry.

27. Damage or Destruction of Leased Premises. Unless occasioned by the negligence or intentionally unlawful act of Lessee, if, during the term of this Lease, any portion of the Leased Premises shall be damaged by fire or other catastrophic cause, so as to render such portion of the Leased Premises untenable, the obligations under this Lease shall be immediately suspended while such portion of the Leased Premises remains untenable. In the event of such damage, the Lessee shall give Lessor notice of such untenable conditions and the Lessor shall elect in its sole discretion, whether to repair the Leased Premises or to cancel this Lease with respect thereto. It shall notify Lessee in writing of its election within thirty (30) days after such damage. In the event the Lessor elects to repair the Leased Premises, the work or repair shall begin promptly and shall be carried on without unnecessary delay. In the event the Lessor elects not to repair the Leased Premises or portion thereof, the Lease shall be deemed canceled as of the date of damage with respect to the applicable portion. Such damage shall not extend the Lease Term. In the event that insurance proceeds are received by Lessee under the property casualty policy required to be carried by Lessee, and the Lease is terminated under this Section 27, the Lessor shall be entitled to the portion of such proceeds attributable to the fixtures, improvements, and other property which would remain with the Leased Premises, and Lessee shall be entitled to the portion of such proceeds attributed to the fixtures and property on the Leased Premises which would be removed by Lessee.

Notwithstanding anything in this paragraph to the contrary, if the Leased Premises are rendered inadequate for Lessee to conduct its normal operations in or upon the Leased Premises (or such portion of the Leased Premises which is still tenantable), and it is reasonably anticipated that the damages shall not be repaired or otherwise resolved, within sixty (60) days of the date of the accident, then Lessee, at its sole and exclusive option, may immediately terminate this Lease. Additionally, irrespective of whether Lessee remains in possession and occupancy of the Leased Premises or elects to terminate this Lease, rent payable under this Lease shall abate during the period that the Leased Premises are not totally useable by Lessee. The abatement shall be pro rata in proportion to the ratio that the amount of space which Lessee is actually able to occupy and from which it is able to conduct operations bears to the total Leased Premises.

Lessee shall continue to make all other payments during this period, including taxes.

28. Assignment and Subletting. Lessee shall not cause, or permit, by operation of law or otherwise, any assignment, encumbrance or transfer of this Lease or any estate or interest therein without the prior written consent of the Lessor. Lessee shall not sublet the Leased Premises or any part thereof without the prior written consent of the Lessor.

Such consent is subject to consideration by Lessor of the financial arrangement between Lessee and its proposed subtenant and is subject to Lessor’s financial participation in such arrangement. In addition, if Lessee’s proposed sublease or assignment arrangement will result in any increased rents or profits accruing to Lessee in excess of the Monthly Base Rent due to Lessor under this Lease, such consent shall further be SCLAA Standard Lease Page 13 Anduril Building 685C

conditioned upon Lessor receiving fifty percent (50%) of the excess amount thereof. An assignment or subletting shall not relieve Lessee of any of its obligations or liabilities under this Lease: both Lessee and any subsequent assignees of Lessee will be deemed to be bound hereunder. The Lessor’s consent to any such assignment, transfer or subletting shall not constitute consent to any further assignment, transfer, or subletting.

This provision is not intended, nor should it be construed, to prevent Lessee from allowing such independent contractors onto the Leased Premises who are involved in Lessee’s normal operations on the Leased Premises (such as repair and maintenance personnel, janitorial personnel, and similar personnel). Additionally, this provision should not be construed to prevent subcontractors of Lessee from conducting their work on the Leased Premises in conjunction with the normal operations conducted by Lessee. To the extent that Lessor must grant its consent for Lessee’s subcontractors to enter onto the Leased Premises for the above-described purposes, consent is hereby deemed to be granted.

29. Indemnification.

To the fullest extent permitted by law, Lessee hereby agrees to defend, indemnify and hold harmless Lessor, the City of Victorville, the Victor Valley Economic Development Authority, the United States Air Force and each of their respective officers, officials, employees, directors, agents, volunteers, independent contractors and assigns (collectively hereinafter the “Indemnified Parties”), from and against any and all claims, actions, suits, proceedings, demands, losses, judgments and costs and expenses, including attorneys’ fees (collectively hereinafter “Claims”), arising from any legal action or proceeding initiated by any individual or entity arising out of, or resulting from the performance of this Lease, except for any such Claims arising out of the sole negligence or willful misconduct of the Indemnified Parties.

30. The Lessor’s Environmental Representations.
(a) Except as otherwise provided in Section 14 hereof, Lessee shall not be held responsible or deemed liable by the Lessor for any hazardous environmental condition on the Leased Premises, which existed prior to Lessee’s occupancy of the Leased Premises. At Lessee’s option and expense, Lessee may conduct an environmental review of the Leased Premises within the first one hundred eighty (180) days of the Term to establish a baseline of the existing hazardous environmental condition of the Leased Premises.
(b) Except as provided in Section 14 hereof, the Lessor represents that to the best of its actual knowledge, the Leased Premises are free from any violations of law or regulations pertaining to occupational hazards and environmental conditions or Hazardous Materials as defined in Section 31 of this Lease. In the event that any hazardous environmental conditions exist on the Leased Premises as of the Lease Commencement Date which result in a loss to Lessee and which were caused by Lessor, the United States Air Force or parties or entities within the control of, or under contract with Lessor, then the Lessor shall indemnify, defend and hold Lessee harmless from any costs, expenses, attorney fees or liabilities relating to any claims of such violations or conditions existing prior to Lessee’s occupancy of the Leased Premises. Lessor shall SCLAA Standard Lease Page 14 Anduril Building 685C

indemnify Lessee from hazardous environmental conditions or violations caused directly by the Lessor, its employees, agents, or licensees during or subsequent to the Term of this Lease.
(c) Lessee shall be solely responsible for obtaining at its cost and expense; any environmental permits required for its operation under this Lease independent of any existing permits.

31. Compliance with Environmental Laws.
(a) The words and phrases set forth below shall have the following definitions:

I. “Hazardous Materials” means and includes any material that because of its quality, concentration or physical or chemical characteristics, poses a significant present or potential hazard to human health and safety or to the environment if released into the workplace or the environment. Hazardous Materials include hazardous wastes, toxic substances, petroleum products and motor fuels and similar substances and materials, including all substances and materials defined as hazardous or toxic substances or materials under California Health and Safety Code section 25501(n) or any other similarly applicable state, federal or local law.

II. “Environmental Laws” means and includes the various health and safety laws and regulations of state, federal and local agencies pertaining to the manufacture, use, storage, disposal, release, and reporting relating to Hazardous Materials.
(b) As of the Lease Commencement Date, Lessee shall not cause or permit any Hazardous Materials to be used, generated, manufactured, produced, stored, brought upon, or released, on, under or about the Leased Premises, or transported to and from the Leased Premises, by Lessee, its agents, employees, contractors, or invitees in violation of any Environmental Laws. Lessee shall indemnify, defend and hold harmless the Lessor from any damage, cost, expense, liability, fine, or penalty resulting from any unauthorized discharge, emission, spill, storage, release, disposal or use of any Hazardous Materials by Lessee, its officers, agents, employees, contractors or invitees or any of them. This obligation of Lessee shall survive the Expiration Date or earlier termination of this Lease and shall apply whenever the Lessor incurs cost or liability arising from any use or activity of Lessee relating to Hazardous Materials during the Term or any extension thereof.
(c) Without limiting the foregoing, if at any time during the Term of this Lease or any extension thereof, the presence of any Hazardous Materials on, under or about the Leased Premises caused by Lessee, its agents, employees, contractors, or invitees results in an unpermitted, unscheduled or unauthorized release or contamination of the Leased Premises by such Hazardous Materials, then Lessee shall at its sole cost SCLAA Standard Lease Page 15 Anduril Building 685C

and expense promptly take all actions necessary to return the Leased Premises to the condition existing prior to the unpermitted, unscheduled or unauthorized release of any such Hazardous Materials on the Leased Premises.
(d) Lessee shall immediately notify the Lessor of the occurrence of any of the following events: (1) receipt by Lessee of any correspondence or communication from any governmental entity regarding the application of Environmental Laws to the Leased Premises or the investigation or enforcement by such governmental entity of any such Environmental Laws in connection with Lessee’s occupancy or use of the Leased Premises, and (2) unpermitted, unscheduled or unauthorized release of any Hazardous Materials on the Leased Premises which may occur at any time during the Term of the Lease or any extension thereof.
(e) To the extent Lessee may conduct any use or activity on the Leased Premises which includes the use, handling, transport, or disposal of any Hazardous Material in quantities which exceed the threshold amounts authorized under California Health and Safety Code section 25507, Lessee shall, at its sole cost and expense, prepare and submit to the City of Victorville (or designated local Certified Unified Program Agency “CUPA”) for approval, renewal or amendment, as applicable, a Business Plan for the Leased Premises, as the term “Business Plan” is described under California Health and Safety Code section 25505.
(f) Notwithstanding any of the foregoing, in the event Lessee, its agents, employees, contractors, or invitees, fails to use and maintain the Leased Premises in accordance with the provisions of this Section 31, Lessor and/or the City of Victorville (the “City”) shall have the right, but not the obligation, to enter the Leased Premises and undertake remedial action as necessary in order to ensure that the Leased Premises are in compliance with all Environmental Laws. In such event, Lessee shall reimburse Lessor and/or the City for all reasonable sums incurred by it for such remediation activities for which Lessee is responsible pursuant to Sections 30 and 31. In such event Lessor may, in its sole discretion, and not limiting its ability to recover through any other means provided in law or equity, determine to deduct all or a part of such sums due under this Section 31 from the Security Deposit.

32. Surrender of Leased Premises. On the Expiration Date of this Lease, Lessee shall surrender and deliver possession of the Leased Premises to the Lessor clean and free of debris and in as good condition as it was on the Lease Commencement Date, reasonable wear and tear excepted.

33. Compliance with Laws. Lessee shall comply with all applicable federal, state, and local laws, regulations and standards that are or may become applicable to Lessee’s activities on the Leased Premises (hereinafter collectively, (“Laws”), including without limitation the SCLA and FAA Rules and Regulations). Lessee agrees to abide by and conform to the SCLA Rules and Regulations, as such may be amended from time to time by Lessor, and to cause its officers, agents, employees, suppliers, shippers, customers, and invitees to so abide and conform. The Lessor shall have the right, from SCLAA Standard Lease Page 16 Anduril Building 685C

time to time, to modify, amend and enforce said rules and regulations. In addition, Lessee agrees to abide by the Selected FAA Rules and Regulations attached hereto as Exhibit C and incorporated herein by this reference, as such may be amended from time to time, and to cause its officers, agents, employees, suppliers, shippers, customers, and invitees to so abide and conform. The Lessor shall not be responsible to Lessee for the noncompliance with said rules by other tenants, their officers, agents, employees, suppliers, shippers, customers and/or invitees. The judgment of any court of competent jurisdiction, or the admission of Lessee in a proceeding brought against Lessee by any government entity, that Lessee has violated any such Laws (except where such admission may be the basis for settlement) shall be conclusive as between the Lessor and Lessee and shall constitute grounds for declaration of default, breach, forfeiture, and termination of this Lease by the Lessor.

34. Defaults.
(a) In the event Lessee should default in the performance of any covenant or condition of this Lease (excluding the payment of any monthly rent or other amounts due hereunder) and such default is not cured or removed within thirty (30) days after service of written notice upon Lessee of such default in the performance of any covenants and conditions; then in such event, the Lessor shall have the right and option to terminate this Lease, to re-enter the Leased Premises, to evict Lessee and to remove Lessee’s possessions, all without being deemed guilty of any trespass, and without prejudice to any claim for arrears of rent or breach of covenant. Notwithstanding the foregoing, if Lessee, prior to the expiration of such thirty (30) day period for default diligently commences to cure such default but is unable to do so within the thirty (30) day period, then such period shall be extended for an additional thirty (30) days provided Lessee continues to make a diligent effort to cure the default. (b) Failure to pay Monthly Base Rent or any other amounts when due shall be deemed a default under this provision. Lessee shall cure such default within ten (10) days after service of written notice.
(c) Any statutory notice required as part of any eviction action or similar type of proceeding may be included with any notice of default given pursuant to this Section 34 and the Lessor need not declare a default and have such default remain uncured prior to delivery of such statutory notice.

35. Remedies of the Lessor. In the event of any breach of the Lease by Lessee and the cure periods described in Section 34 hereof have expired, the Lessor may at any time thereafter, with or without notice or demand and without limiting the Lessor in the exercise of any other right or remedy which the Lessor may have by reason of such breach, do any of the following:

SCLAA Standard Lease Page 17 Anduril Building 685C

(a) terminate Lessee’s right to possession of the Leased Premises by any lawful means, in which case this Lease shall terminate, and Lessee shall surrender possession of the Leased Premises to the Lessor. This may involve the Lessor filing an unlawful detainer action and receiving a court order for Lessee to vacate the premises.

In any such event, the Lessor shall be entitled to recover from Lessee all damages incurred by the Lessor by reason of Lessee’s default, including, but not limited to the cost of repairing or restoring damages to the Leased Premises caused by Lessee, the cost or removal of Lessee’s improvements, fixtures and other contents of the Leased Premises, costs associated with past or future brokerage commissions and marketing expenses and the other costs payable by the Lessor in connection with the recovery of possession of the Leased Premises, including but not limited to reasonable attorneys’ fees and court costs, as well as: (1) the worth at the time of award by the court having jurisdiction thereof of the unpaid rent which had been earned at the time of termination, and (2) the worth at the time of award by the court having jurisdiction thereof of the amount by which the unpaid rent for the balance of the Term after the time of such award may exceed the amount of such rental loss for the same period that Lessee proves could be reasonably avoided; or
(b) pursue any other remedy now or hereafter available to the Lessor under the laws or judicial decisions of the State of California.

36. Default by the Lessor. In the event Lessor should default in the performance of any covenant or condition of this Lease and such default is not cured or removed within thirty (30) days after service of written notice of default upon Lessor, then in any such event, Lessee shall have the right and option to terminate this Lease. If Lessor, prior to the expiration of such thirty (30) day period for a default, diligently commences to cure such default, but is unable to do so within the thirty (30) day period, then such period shall be extended for an additional thirty (30) days provided Lessor continues to make a diligent effort to cure the default. In event of uncured default Lessee shall have all remedies available at law or in equity for any default or breach of this Lease by the Lessor.

37. Force Majeure-Unavoidable Delays. If the performance of any act required by this Lease to be performed by either Party is prevented or delayed by reason of an act of God, strike, lockout, labor troubles, inability to secure materials, unreasonably restrictive governmental laws or regulations, or any other cause except financial inability that is not the fault of the Party required to perform the act, the time for performance of the act will be extended for a period equivalent to the period of delay, and performance of the act during the period of delay will be excused. However, nothing contained in this Section 37 shall excuse the prompt payment of rent by Lessee as required by this Lease or the performance of any act rendered difficult solely because of the financial condition of the Party required to perform the act.

SCLAA Standard Lease Page 18 Anduril Building 685C

38. Notices. Any and all notices or demands required or permitted to be given hereunder must be personally delivered or be mailed by registered or certified mail, return receipt requested, addressed as follows:

To the Lessor:

With copies to:

To Lessee:

Southern California Logistics Airport Authority
18374 Phantom West
Victorville, CA 92394
Attn: Airport Director
Green de Bortnowsky, LLP
30077 Agoura Court, Suite 210
Agoura Hills, CA 91301
Attn: Andre de Bortnowsky, Esq.

Anduril Industries, Inc.
1400 Anduril
Costa Mesa, CA 92626
Attn: Babak Siavoshy
or at such other address or addresses that either Party may hereafter designate in writing to the other. Any notice or demand which is mailed by registered or certified mail as provided above shall be deemed to be effective and given for all purposes three (3) business days following the time of deposit thereof, postage prepaid, in the United States mail.

39. Miscellaneous.
(a) One or more waivers of any provision of this Lease by the Lessor shall not be construed as a waiver of a subsequent breach of the same provision and the Lessor’s consent or approval shall not be deemed to waive or render unnecessary the Lessor’s consent or approval to or of any subsequent or similar act by Lessee. (b) If either Party to this Lease shall bring any action for any relief against the other, declaratory or otherwise, to enforce the terms hereof or to declare rights here under (collectively, an Action), the losing Party shall pay to the prevailing Party attorneys’ fees and costs incurred in bringing and prosecuting such Action and/or enforcing any judgment, order, ruling, or award (collectively, a Decision) granted therein, all of which shall be deemed to have accrued on the commencement of such Action and shall be paid whether such Action is prosecuted to a Decision. Any Decision entered in such Action shall contain a specific provision providing for the recovery of attorneys’ fees and costs incurred in enforcing such Decision. The court may fix the amount of reasonable attorneys’ fees and costs on the request of either Party. For the purposes of this paragraph, attorneys’ fees shall include, without limitation, fees incurred in the following: (1) post- judgment motions and collection actions; (2) contempt proceedings; (3) garnishment, levy, and debtor and third-party examinations; (4) discovery; and (5) bankruptcy litigation. “Prevailing Party” within the meaning of this paragraph includes, without limitation, a Party SCLAA Standard Lease Page 19 Anduril Building 685C

who agrees to dismiss an Action upon the other Party’s payment of the sums allegedly due or performance of the covenants allegedly breached, or who obtains substantially the relief sought by it. Nothing contained in the Section shall be interpreted to mean that Lessor has agreed to arbitrate any dispute which may arise hereunder. (c) This Lease can be modified, supplemented, amended, or rescinded only by a writing expressly referring to this Lease and signed by Lessor and Lessee. (d) If any provision of this Lease or any application thereof shall be invalid or unenforceable, the remainder of this Lease and any other application of such provision shall not be affected thereby. Unless otherwise expressly provided herein, any approval or consent of Lessor required hereunder shall not be unreasonably withheld or delayed. This Lease shall be binding upon and inure to the benefit of and be enforceable by the respective successors of the Parties hereto. The Section headings in the Lease are for purposes of reference only and shall not limit or define the meaning hereof. (e) This Lease contains the entire understanding and agreement of the Parties, supersedes all prior understandings and agreements, and cannot be changed orally. This Lease shall be construed in accordance with the laws of the State of California.

Time is of the essence.
(f) Any conflict between the printed provisions, exhibits, or addenda of this Lease and the typewritten or handwritten provisions, if any, shall be controlled by the typewritten or handwritten provisions provided such typewritten or handwritten provisions are initialed by both Parties.
(g) This Lease shall be of no force and effect unless executed by both Parties. Each person executing this Lease for the respective Parties expressly represents and warrants that he or she has the authority to enter into Leases on behalf of and bind the entity on whose behalf this Lease is executed.
(h) This Lease may be executed by the Parties in counterparts, and when executed by each of the Parties, each counterpart shall be deemed to be a part of the same instrument.
(i) Lessor agrees that Lessee may require that anyone entering into the Leased Premises sign a commercially reasonable non-disclosure agreement as a condition to gaining entry to the Leased Premises, in order to preserve the confidential nature of Lessee’s operations from inside the Leased Premises. [END OF THIS PAGE – SIGNATURES FOLLOW]
SCLAA Standard Lease Page 20 Anduril Building 685C

IN WITNESS WHEREOF, the Parties have executed this Lease Agreement as of the dates set forth below.
[LESSEE]
ANDURIL INUSTRIES, INC.
______________________________
Babak Siavoshy
___________________
Date
Chief Financial Officer
[LESSOR]
SOUTHERN CALIFORNIA LOGISTICS AIRPORT AUTHORITY (“SCLAA”) ______________________________
C. Eric Ray
___________________
Date
Airport Director
ATTEST:
______________________________
Jennifer Thompson
___________________
Date
SCLAA Secretary
APPROVED AS TO STANDARD FORM:
______________________________
Andre de Bortnowsky
___________________
Date
SCLAA Legal Counsel

RISK MANAGER
______________________________
Sandra Bostick
___________________
Date
SCLAA Standard Lease Page 21 Anduril Building 685C

EXHIBIT A

DESCRIPTION OF LEASED PREMISES
Building 685C consisting of approximately Two Thousand Five Hundred Fifty-Two (2,552) square feet of office space and Eight Thousand Six Hundred Sixteen (8,616) square feet of hangar space for a total combined square footage of approximately Eleven Thousand One Hundred Sixty-Eight (11,168) square feet, located on the SCLA at 18310 Readiness Street, Victorville, CA 92394, as depicted on Exhibit A-1. Vehicle parking space is located immediately south of Building 685C and is depicted on Exhibit A-2; and Ground Control Center space consisting of approximately Twelve Thousand (12,000) square feet of exterior space adjacent to Taxiway Charlie as depicted on Exhibit A-2.

The Ground Control Center space must be thirty (30) feet from the taxiway shoulder, fifteen (15) feet from the ramp concrete and fifteen (15) feet from the parking and storage area for the tenants of Building 682 which is located on the west side of Building 682, maximum height is 30 feet; and
Aircraft Shade Structure space, aircraft access, and additional vehicle parking space consisting of approximately Eleven Thousand Four Hundred Thirty-Five (11,435) square feet, as depicted on Exhibit A-3.

These properties combined in total, with the improvements thereon, represent the Leased Premises.

In addition to the forgoing Leased Premises, Lessee will have a “right of use” for the Cargo T, as depicted on Exhibit A-2, for such purposes related to its aircraft operations, to be used in common with others at such times as coordinated through the Airport Operations Division.

SCLAA Standard Lease Page 22 Anduril Building 685C

Exhibit A-1
Common Access Restroom

Exhibit A-2 30 Ft
15Ft
15Ft
Ground Control
Center Space
Max Height 30'
+/- 12,000 Sq Ft
160'x170'
Bldg 682
A Cargo T
Use must be
coordinated through
Airport Operations
760-243-1915
B C
x40'x120'
Bldg 685
A B C
Aircraft Shade
Structure Space
+/- 2,000 Sq Ft
40' x 50'
Vehicle Parking
Area to be improved for aircraft shade
structure space, aircraft access &
additional vehicle parking
Gate 23
Cargo GateFlightline Rd
+/- 11,435 Sq Ft
Bldg
728
Bldg
683
Bldg 676
600 ft

Exhibit A-3
Ramp Space West of Bldg 685A
Must Have 4' Clearance
from Bldg 685A
Aircraft Shade
Structure
Space
+/- 2,000
Sq Ft
40' x 50'
Bldg 685BBldg 685ABldg 880
30'
Protect In Place
Post Indicator Valve
Protect In Place
Backflow
Area to be Improved
for Aircraft Shade Structure
Space, Aircraft Access &
Additional Vehicle Parking
+/- 11,435 Sq Ft
57'

EXHIBIT B

SCLA RULES AND REGULATIONS
SCLAA Standard Lease Page 23 Anduril Building 685C

Exhibit B
Southern California
Logistics Airport
Rules and Regulations
Amended
April 17, 2007

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

RULES AND REGULATIONS FOR THE USERS OF SOUTHERN CALIFORNIA LOGISTICS AIRPORT; ESTABLISHING FEES FOR THE VARIOUS USES; DEFINING TERMS; PROHIBITING OR LIMITING CERTAIN ACTIVITIES; FIXING PENALTIES FOR VIOLATIONS; AND PROVIDING FOR AMENDMENTS TO

THESE RULES AND REGULATIONS AS MAY BE NEEDED FROM TIME TO TIME SECTION 1. SHORT TITLE:

1.1 These Rules and Regulations shall be referred to as the Southern California Logistics Airport (SCLA) Rules and Regulations. It may be amended by a majority vote by the Board of the Southern California Logistics Airport Authority (SCLAA).

SECTION 2. APPLICABILITY:

2.1 These Rules and Regulations apply equally to every Airport User. The Airport Operating Manual or Specifications, as applicable, adopted in accordance with FAR Part 139, and the Airport Policies and Procedures Manual are hereby made by reference a part of these Rules and Regulations.

SECTION 3. RESPONSIBILITIES:

3.1 Management: It shall be the responsibility of the Airport Director to fairly and impartially administer these Rules and Regulations.

3.2 Users: It shall be the responsibility of every Airport User, pilot or other, to become familiar with the SCLA Rules and Regulations and to obey those Rules and Regulations. Current copies of these Rules and Regulations will be maintained reflecting any amendments and will be posted at the SCLA Administrative Office and at Million Air. Additional copies will be provided by the SCLA Airport Director through the SCLA Administrative Office to any Airport User who requests such copy.

SECTION 4. DEFINITIONS:

For the purposes of these Rules and Regulations, the following definitions and meanings shall apply unless otherwise specified:

4.1 “Air Operations Area” or “AOA” means the area upon which aircraft are able to operate and includes the runways, taxiways, taxi lanes, apron area, and the vehicle and personnel gates that lead to these areas.

4.2 “Air Carrier” means any person who undertakes directly, by lease, or other arrangement, to engage in air transportation of persons or things. An “Air Carrier” operates in various categories, under authority or certification by the FAA and holds a current FAA certificate to transport air passengers or property for hire.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

4.3 “Aircraft” means a device that is used, or is intended to be used, for flight in the air. “Aircraft” includes airplanes, helicopters and gliders, and lighter than air devices such as blimps or balloons, but does not include hang gliders.

4.4 4.5
“Aircraft Owner” shall mean a Person who holds title to an Aircraft. “Aircraft Operator” shall mean the Person who is operating or controlling an Aircraft while said Aircraft is on Airport property.

4.6 4.7
“Aircraft Storage” shall have the same meaning as “Stored Aircraft”. “Airport” means the SCLA, its buildings and facilities, all lands owned and or controlled by the SCLAA contiguous to the airport, including airspace above such land and the designated approaches thereto.

4.8 4.9
“Airport Director” means that person so appointed by the SCLAA or his designated representative.
“Airport Master Security Program” or “Airport Security Program” means the Security Program, which is the responsibility of an Airport Operator pursuant to TSA 1542.

4.10 “Airport Operations and Security Department” or means the Airport Operations and Security Department of the Southern California Logistics Airport.

4.11 “Airport Security Areas” or “Secure Areas” means Air Operations Areas, roadways, and common Air Carrier areas within terminal facilities (i.e. baggage makeup areas), excluding exclusive leasehold structural areas, to which public access is limited or denied under Airport Master Security Program.

4.12 “Airport Security Coordinator” or “ASC” means an individual appointed by the Airport Director, charged with the responsibility to implement and enforce the Airport Master Security Program, employed by the City of Victorville and under the direction of the Airport Director, or the Airport Security Coordinator’s designated representative.

4.13 “Airport Tenant” means an individual, partnership, corporation or other business entity, and its agents, employees, representatives, and subtenants which occupies or controls all or part of Airport areas, buildings or other facilities which they lease from the Southern California Logistics Airport Authority.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

4.14 “Airport Tenant Security Program” shall have the same meaning as set forth in TSA1542.113, entitled “Airport Tenant Security Programs.”

4.15 “Airport User” means any Person who uses the Southern California Logistics Airport, including but not limited to, Airport Tenants and subtenants, Fixed Base Operators, Air Carriers, Aircraft Owners, Aircraft Operators, Commercial Operators, passengers, and their employees, agents, representatives, agents, successors and assigns.

4.16 “Authorized Person” means an individual authorized with a Personnel Identification Badge issued by the Airport Security Coordinator, or his designated representative, to have unescorted access authority to Airport Security Areas.

4.17 “Air Traffic” means Aircraft operating in the air or on an Airport surface, exclusive of loading ramps or parking areas.

4.18 “Air Traffic Clearance” means an authorization issued by Air Traffic Control personnel for an Aircraft to proceed under specified traffic conditions within controlled airspace.

4.19 “Air Traffic Control” or “ATC” shall mean the Air Traffic Control of the Southern California Logistics Airport.

4.20 “Airworthy Condition” means a condition wherein an Aircraft can take flight under its own power. See definition of “Non-Airworthy Aircraft” below.

4.21 “Autorotation” means a rotorcraft flights condition in which the lifting rotor is driven entirely by action of the air when the rotorcraft (helicopter) is in motion.

4.22 “Balloon” means a lighter-than air aircraft, which is not engine-driven.

4.23 “Based Aircraft,” means Aircraft that are parked on the Airport for thirty (30) days or longer and are not part of an aircraft storage program.

4.24 “Ceiling” means the height above the earth's surface of the lowest layer of clouds or obscuring phenomena, that is reported as “broken,” “overcast,” or “obscuration,” and is not classified “thin” or “partial”.

4.25 “City” means the City of Victorville.

4.26 “Commercial Operator” means any Person who, for compensation or hire, engages in the carriage of persons, property, or mail in air commerce, or engages in other aerial activity such as flight instruction, aerial photography, fire fighting, agricultural aviation activities, or traffic surveillance.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

4.27 “Criminal History Records Check (CHRC)” means a fingerprint-based criminal history records check as described in 49 CFR § 1542.

4.28 “Commercial Use” means use of SCLA for revenue-producing commercial activities.

4.29 “Dismantled Aircraft” means an Aircraft which has been disassembled to a point where it is not reasonable to assume that said Aircraft can be reassembled and placed in an Airworthy Condition.

4.30 “Driving Permit” means a permit issued by the Airport Director or his designee in order for an Individual to operate a Vehicle on the Airport.

4.31 “Escort” means an Authorized Person or Authorized Persons accompanying, monitoring, directing and controlling the actions of an Individual or Individuals who are not displaying Personnel Identification Badges, and/or who are not otherwise Authorized Persons, within Airport Security Areas. The Authorized Person(s) performing an Escort must be displaying valid Personnel Identification Badges, must be accompanying the Individual or Individuals for performance of direct job duties and must ensure that those Individuals who are being escorted remain within sight and sound at all times.

4.32 “Executive Director” means the Executive Director of the Southern California Logistics Airport Authority.

4.33 “FAA” means the Federal Aviation Administration of the United States Government or any federal agencies succeeding to its jurisdiction.

4.34 “Fixed Base Operator” means any Person who rents, leases, or owns facilities located on SCLA, who by virtue of his specific type of aviation or aviation related activity, requires the occupancy of a site with contiguous aircraft apron and direct access to the Aircraft Operation Area, and who engages in a business activity providing aviation sales or service, including but not limited to any of the following:

1. Selling and/or servicing new and used Aircraft and
component parts;

2. Aircraft maintenance and repairs;

3. Sales and/or repair of avionics;

4. Aviation training (including ground or flight instruction);

5. Aerial photography;
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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

6. Air ambulance service;

7. Aircraft agricultural operations (crop dusting, spraying, or the application of seed, fertilizers, pesticides, defoliants, etc);

8. Aircraft rental, charter, leasing;

9. Aircraft Storage;

10. Fuel and oil sales and servicing; and

11. Aircraft servicing or ground handling including cargo handling, baggage handling, lavatory service, water service, air starts, ground power, or other elements related to aircraft handling.

4.35 ”Flight Visibility” means the average forward horizontal distance from the cockpit of an Aircraft in flight, at which prominent unlighted objects may be seen and identified by day, and prominent lighted objects may be seen and identified by night.

4.36 “Ground Visibility” means prevailing horizontal visibility near the earth's surface.

4.37 “Helicopter” means a rotor driven aircraft (rotorcraft) that, for its horizontal motion, depends primarily on its engine-driven rotors.

4.38 “IFR” means Instrument Flight Rules covering meteorological conditions below the minimums for flight under visual (VFR) conditions.

4.39 “Individual” means a natural person.

4.40 “Maintenance” means inspection, overhaul, repair, preservation, and the replacement of parts, including preventive maintenance.

4.41 “Movement Area” means the runways, taxiways, and other areas of the Airport, which are utilized for taxiing, takeoff, and landing of Aircraft. The Movement Area does not include parking and loading ramps. Entry into the Movement Area requires ATC approval.

4.42 “Night” means the time between the end of evening civil twilight and the beginning of morning civil twilight as published in the American Air Almanac, converted to local time.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

4.43 “Non-Airworthy Condition” means when an Aircraft cannot take flight under its own power as a result of being in disrepair or in the process of being disassembled.

4.44 “Notice of Violation” means a written notification of non-compliance with these Rules and Regulations, issued by the Airport Director or his designated representative.

4.45 “Person” means an individual, firm, partnership, corporation, company, association, joint-stock association, or governmental entity, and includes a trustee, receiver, assignee, or similar representative of any of them.

4.46 “Personnel Identification Badge” means a Personnel Identification Badge issued to an Individual by the Southern California Logistics Airport for purposes of granting that Individual unescorted access authority to the Restricted Area.

4.47 “Ramp” means an improved surfaced area reserved exclusively for the parking and taxiing of Aircraft.

4.48 “Restricted Area” means all areas or facilities accessible only by Authorized Persons or Persons under Escort, and including all Ramp areas and the Aircraft Operations Area (AOA).

4.49 “Roadway” means that portion of an area improved or designed or ordinarily used for vehicular travel. A roadway on the Airport Operations Area is called a vehicle service road (“VSR”).

4.50 “Runway” means an improved surfaced area reserved exclusively for the landing and taking off of Aircraft.

4.51 “Scheduled Air Carrier” means any Person providing scheduled passenger or cargo service from the Airport in accordance with a published schedule and having at least one scheduled departure per day, or no less than five scheduled departures per week, and operating under authority of the Federal Aviation Administration and the Airport.

4.52 “Security Perimeter” means the portion of the Airport that is enclosed by fencing, walls or other barriers, and to which access is controlled through designated entry points.

4.53 “SCLA” means Southern California Logistics Airport.

4.54 “SCLAA” means Southern California Logistics Airport Authority.

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4.55 “Security Devices” means equipment installed or placed by or under the direction of the Southern California Logistics Airport Authority, or designated representative, to monitor or control entrances to and exits from Airport Security Areas. “Security Devices” include, but are not limited to, bells, sirens, communication equipment, locks and corresponding keys, emergency exits, electronic access control and other security equipment.

4.56 “Security Identification Display Area” or “SIDA” shall have the same meaning as set forth in TSA1542.205. Before being granted unescorted access to the SIDA, Individuals must undergo a Criminal History Record Check and employment history verification.

4.57 “Security Screening Area” means an access point, including entrances and exits, to the Airport Security Areas, Secure Areas and the Sterile Areas, where Vehicles, equipment, Individuals, and belongings are inspected prior to entrance.

4.58 “Sterile Area” means an area to which access is controlled by the inspection of Individuals and property in accordance with FAA and TSA requirements.

4.59 “Stirling Airport International” or “SAI” means SCLA’s development partner.

4.60 “Stored Aircraft” means aircraft that are parked at/on airport property and are part of an aircraft storage program.

4.61 “Taxiway” means an improved surfaced area reserved exclusively for use by aircraft to proceed to and from ramp and runway areas.

4.62 “Traffic Pattern” means the traffic flow that is prescribed for aircraft landing at or taking off from SCLA.

4.63 “Unnecessary Noise” means any engine noise that is greater than the level produced when the engines are at idle except when required for taxiing of the aircraft, takeoff or landings.

4.64 “Vehicle” means every device in, upon or which any Individual or property is or may be transported or drawn upon a roadway, excepting devices moved by human power or used exclusively upon stationary rails or tracks. A bicycle shall be considered a vehicle under all portions of these Rules and Regulations, which govern right-of-way.

4.65 “Vehicle Owner” means a person who holds the legal title of a vehicle.

4.66 “Vehicle Service Road” or “VSR”. (See Roadway.)

4.67 “VVEDA” means the Victor Valley Economic Development Authority.

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4.68 “VFR” means Visual Flight Rules covering meteorological conditions, above those requiring flight under IFR conditions.

4.69 “Word Construction”: The following construction applies throughout these Rules and Regulations:

1. 2.

3. Words importing the singular include the plural,
Words importing the plural include the singular; and,
Words importing the masculine gender include the
feminine and the neutral gender.

SECTION 5. NECESSITY:

5.1 These Rules & Regulations are enacted to protect the health, safety and peace, and to promote the welfare and convenience of the general public using SCLA, or affected by activities related to the Airport by providing for the orderly conduct of activities on, or related to, the Airport. The use of the Airport or any of its facilities in any manner shall create an obligation on the part of the Airport User to obey all of the rules and regulations herein provided.

SECTION 6. BASED AIRCRAFT:

6.1 Any Person desiring to base an Aircraft at SCLA shall register such Aircraft at the Airport Operations and Security Department as soon as possible but not later than 24 hours after the arrival of the Aircraft. If a change in ownership occurs while the Aircraft is based at the Airport, the new Aircraft Owner shall re-register the Aircraft with the Airport Operations and Security Department, again, no later than 24 hours after the change in ownership occurred.

6.2 Except as specifically set forth in an Airport land or facility sublease, Aircraft in a Non-Airworthy Condition shall not be permitted to remain on the Airport in excess of five (5) days without the express prior written permission of the Airport Director. Such Aircraft shall be removed from the Airport or stored at the Aircraft Owner’s expense.

SECTION 7. AIRCRAFT STORAGE AND PARKING:

7.1 Aircraft shall only be stored or parked at places as set forth in such Person’s sublease or as may be authorized by the Airport Director, and such storage or parking shall be at the sole risk of the Aircraft Owner and/or Aircraft Operator, and without any responsibility to SCLAA, VVEDA or Stirling Airport International, or any of their officers, employees, agents or representatives, for any loss of, or damage to the Aircraft while so stored or parked. The Aircraft Owner and/or the Aircraft Operator shall be responsible for the tying-down and/or securing of his Aircraft. The Aircraft Owner and/or Aircraft Operator shall likewise be responsible for any liability arising from or caused by his Pg.8 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Aircraft or his activities. All Airport Tenants desiring to store Aircraft at SCLA must notify the Airport Director in writing prior to the Aircraft arriving at SCLA.

SECTION 8. COMMERCIAL ACTIVITY:

8.1 No Person shall utilize SCLA for any revenue-producing commercial activities without the express written permission of SCLAA or its designated representative, and obtaining a City of Victorville Business License for such activities, and paying the fees and charges established for such use or license.

SECTION 9. AIRPORT FEES:

9.1 Funding for Airport operations and capital improvements is derived through various types or classes of Airport User Fees. Airport User fees are specifically established to compensate the Airport for the use, maintenance and repair of Airport facilities, as well as to minimize the need for on-going general taxpayer support.

9.2 9.3
A schedule of rates and charges for the use of the Airport and its facilities may be found as Attachment A to these Rules and Regulations.

Any Aircraft Owner or Aircraft Operator who fails to pay any fee duly charged for Aircraft owned or controlled by him shall have such Aircraft subject to impounding until the fees are paid, along with any impound fees, or until the Aircraft is sold for charges.

SECTION 10. HOURS OF OPERATION:

10.1 SCLA shall be open for public use at all hours of the day and night, subject to any restrictions imposed by the Airport Director due to inclement weather, condition of the landing area, presentation of special events, construction or repair activities, or similar causes. The control tower is open 24 hours a day, 7 days a week. The Airport is attended from 6:00 A.M. to 10:00 P.M. daily by Million Air. Services may be obtained from Million Air during said hours at telephone number (760) 246-7794 or UNICOM (122.85 MHz).

SECTION 11. UNATTENDED AIRCRAFT:

11.1 No Aircraft shall be left unattended on the Airport unless properly secured or within a hangar. Aircraft Owners and/or Aircraft Operators of Aircraft left so unattended shall be liable for damage to other Aircraft or property resulting from the failure to adequately secure or tie down the Aircraft.

SECTION 12. MAINTENANCE:

12.1 Unless otherwise authorized by the Airport Director, or specified as a permitted use in an Airport facility or land sublease, no Aircraft or Vehicle maintenance, other than that which is required to remove damaged Aircraft from the Runway or Taxiway(s), or that which is necessary to replace a flat tire, shall be Pg.9 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS performed at SCLA except in areas specifically designated by the Airport Director for that purpose.

SECTION 13. EQUIPMENT REQUIREMENTS:

13.1 Every Aircraft using SCLA shall be equipped with a fully functional, two-way radio, except when operating into or from the Airport under an FAA waiver for radio maintenance. The ATC frequency is 118.35 MHz and the ground control frequency is 124.45 MHz. Weather and traffic advisories are broadcast on 109.40 MHz. No fixed-wing Aircraft equipped with a tailskid shall operate on any paved surface of SCLA.

SECTION 14. ACCIDENTS:

14.1 Every Person involved in, or witnessing an Aircraft operating accident on the Airport shall report promptly the details of such accident to the Airport Director, ATC, or FAA.

14.2 In addition, the Aircraft Owner and/or the Aircraft Operator, including pilot, shall report fully to the California Division of Aeronautics the details on any accident in which there is death or injury, or in which damage to the property of others exceeds $400.00.

14.3 The Aircraft Owner and/or the Aircraft Operator of an Aircraft which is damaged or wrecked in an accident shall be responsible for the prompt removal of the Aircraft as directed by the Airport Director.

14.4 Where the Aircraft Owner and/or Aircraft Operator of an Aircraft which is damaged or wrecked in an accident is unable to arrange for removal of such disabled or wrecked Aircraft, the Airport Director shall have the authority to move, or arrange the removal of, the Aircraft when released (if applicable) by the FAA or the National Transportation Safety Board (NTSB).

14.5 No liability shall be incurred by the SCLAA, SAI, VVEDA, the Airport Director or any of their officers, employees, agents, successors and assigns, for damage aggravated by, or resulting from, removal of an Aircraft pursuant to Section 14.4 of these Rules and Regulations.

SECTION 15. NOISE:

15.1 No Person shall operate any Aircraft in flight or on the ground in such a manner as to cause Unnecessary Noise as determined by applicable Federal or State or local laws and regulations.

SECTION 16. RESTRICTED AREAS:

16.1 Restricted Areas include those areas leased to the Army National Training Center, Advanced Unmanned Systems-Concept Exploration, Southern California Aviation, Victorville Aerospace LLC, Army Reserve, or other area that has direct access to the AOA. No Person shall enter any Restricted Area Pg.10 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS except (a) employees or invitees of the leaseholder, (b) Persons duly authorized by the Airport Director, including, but not limited to, Authorized Persons who have received Personnel Identification Badges, or (c) security or fire-fighting personnel.

16.2 Every Person who has access to a restricted area shall close and lock the door, gate or other device immediately after it has been used unless it is under surveillance of a Person who is responsible for controlling entry at that access point.

16.3 Every Airport Tenant whose premises have total or limited access to any Restricted Areas shall prevent access to the Restricted Areas by Persons who are not authorized to have such access.

16.4 The Airport Director’s staff is authorized to close and lock any door, gate or other device permitting access to a Restricted Area that is found open or unlocked and unattended.

16.5 Every Person to whom a key, code or access device has been issued by the Airport Security Director, or his designated staff, shall use the key, code or access device to enter a Restricted Area only in accordance with any conditions of issuance and only at Restricted Area access points.

16.6 Except where authorized by the Airport Director and subject to any conditions of issuance, no Person shall:

1. Loan or give to another Person a key, code or access device issued to him; or

2. Have possession of, or use for any purpose, a key, code or access device that was issued to him by a Person not
having authority to do so.

SECTION 17. ANIMALS:

17.1 No Person shall willfully and knowingly allow or permit any animal owned, possessed, or harbored by him to enter the Airport unless the animal is leashed or restricted in such manner as to be under control, or is in a shipping container, or is otherwise under physical restraint, nor shall any Person allow or permit such animal except “special assistance animals” (i.e. guide dog) to enter any Airport building without the approval of the Airport Director.

SECTION 18. ACCESS TO RUNWAYS AND TAXIWAYS:

18.1 No Person shall enter upon any Runway or Taxiway, or the movement area as defined by FAA, without the express consent of the Air Traffic Control Tower representative.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS SECTION 19. STARTING ENGINES:

19.1 No Person shall start any Aircraft engine at SCLA:

1. Unless a competent operator is at the controls;

2. Unless the Aircraft is equipped with adequate brakes fully applied or the wheels are securely blocked with blocks or chocks that can be removed safely (Skid equipped helicopters do not have brakes or chocks);

3. When the Aircraft is in such a position that the propeller slipstream or jet blast can cause damage to, or interfere with the operation of, other Aircraft, Vehicles, mobile equipment, hangars, shops, other buildings, or can cause injury to passengers, spectators, or other personnel; and

4. When the Aircraft is within 50 feet of any building without prior written consent.

SECTION 20. ENGINE RUN-UPS:

20.1 No Person shall conduct an aircraft engine run-up beyond idle anywhere on the Airport other than in areas designated by the Airport Director (with the exception of helicopters, which routinely operate with engines beyond idle as part of normal operations).

20.2 Persons who want to conduct an engine run-up beyond idle shall first call ATC on the ground control frequency, 124.45 MHz, and request clearance to one of the two engine run-up areas. ATC will advise the Airport User, given the current wind direction, to proceed to one of two designated engine run-up areas.

20.3 ATC will make the final determination of which engine run-up area should be used.

20.4 The Person requesting the engine run-up beyond idle will conduct the engine run-up in the area designated by ATC and he shall exercise the necessary caution to ensure no damage is created by the engine run-up.

SECTION 21. TAXIING:

21.1 Only those personnel that have training and are qualified to taxi a particular type of Aircraft are permitted to taxi Aircraft at SCLA.

21.2 No Person shall taxi any Aircraft into, out of, or within any hangar or other building on or adjacent to the Airport.

21.3 No Person shall taxi any Aircraft across the double yellow lines on the edge of Taxiways and the apron.

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21.4 Nor shall any Person move any Aircraft under its own power on the Airport unless that Person is in full control of such aircraft, and has assured himself that there is no danger of collision with other Aircraft, Vehicles, equipment, buildings, or other obstacles. Aircraft shall be taxied at a safe speed.

SECTION 22. DUMPING REFUSE:

22.1 No Person shall place, deposit, or dump any garbage, cans, bottles, papers, ashes, sewage, carcass of any dead animal, offal, trash rubbish, debris or any other refuse in any location on the Airport except in containers designed for such purposes.

SECTION 23. FIREARMS:

23.1 No Person shall shoot any projectile from a firearm or other device, into, on, or across any portion of the Airport, nor have in his possession, or under his control, any firearm which is not unloaded and securely wrapped and boxed for shipment, or explosive or explosive device; provided,

23.2 However, that this Section does not apply to peace officers, military personnel, or Airport security guards who are acting in the performance of their duties as such. Firearms on Airport property are pre-coordinated with ASCs when possible.

SECTION 24. TRAFFIC PATTERN:

24.1 Every Aircraft before landing and after takeoff shall be flown as directed by ATC.

SECTION 25. TAKE-OFFS AND LANDINGS:

25.1 No aeronautical activity shall be conducted at SCLA except in conformance with current Federal Aviation Regulations, State of California law and regulations, and these Rules and Regulations.

25.2 All initial takeoffs shall commence at the end of the Runway unless cleared by the ATC Tower.

25.3 Due to the complex mix of Aircraft that utilize SCLA, there is need to limit those type of aircraft and aerial activities that represent a potential hazard to normal flight operations. The following aircraft and aerial activities are restricted from operating at SCLA except in emergency situations or with prior approval of the Airport Director:

1. Hot Air Balloons;

2. Hang Gliders;

3. Parachutists;
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4. Radio Controlled Aircraft;

5. Ultra Light Aircraft;

6. Gliders; and

7. Motorized Lighter than Air Aircraft.

SECTION 26. AIRCRAFT FUELING AND DEFUELING:

26.1 In accordance with the regulations from the National Fire Protection Association (NFPA), Uniform Fire Code (UFC), and the Department of Transportation (DOT) the following rules and regulations must be observed while fueling aircraft:

26.2 All fuel servicing must be done outside of any building or hangar. (NFPA 407 3-10).

26.3 Aircraft shall be located a minimum of fifty (50) feet away from any building openings, doors, windows, etc.

26.4 During fuel handling, no passenger shall be permitted in or on the Aircraft unless a cabin attendant is stationed at or near the cabin door.

26.5 Fueling shall not be done while an on-board engine is operating (“hot fueling”) without the permission of the Airport Director and then, it shall only be permitted when representatives of the Fire Department are standing by.

Exception is allowed for A.P.U. operation on large aircraft. (NFPA 407 3-5.1)

26.6 Equipment other than Aircraft service equipment shall not be permitted within fifty (50) feet of an Aircraft during fueling or defueling. (NFPA 407 3-

5.1)

26.7 No open flames, smoking, battery chargers, or any material or device which is likely to cause a spark shall be in use within fifty (50) feet of an Aircraft or fueling truck during fueling or defueling operation. (NFPA 407 3-7, 3-8).

Exception is allowed for Ground Power Units.

26.8 All hoses, funnels and appurtenances used in fueling or defueling activities shall be equipped properly with grounding and bonding devices to prevent possible static ignition of volatile liquids or vapors. Such grounding and bonding devices shall be used during all fueling and defueling activities.

26.9 Refueling vehicles, fuel hoses and defueling equipment shall be maintained in a safe, sound, operational and non-leaking condition.

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26.10 Gravity (hand) fueling may not be accomplished with any container having a capacity greater than five (5) US gallons. (NFPA 407 3-2.3)

26.11 All portable fuel containers must be approved and marked so as to identify the product contained therein. (UFC)

26.12 Any fuel transported by privately owned vehicles, not specifically designed for the transport of flammable liquids and appropriately placarded, are limited to a maximum of 20 U.S. gallons in an approved and marked container. (DOT and UFC)

26.13 Portable fuel containers shall be kept in approved locations, at least fifty (50) feet from any building, and secured in a cabinet or locker marked “Flammable.” (UFC)

26.14 Every Person engaged in aircraft fuel handling shall exercise due care to prevent the overflow of tanks and spilling of fuel. Fuel spills are a fuel operator’s responsibility.

26.15 Where there has been a fuel spill or leak, no Person shall start the engine of any Aircraft in close proximity until the spill or leak has been cleaned up. In event such spills or leaks are over 10 ft. in any direction, or over 50 sq. ft. in area, or continues to flow, or are otherwise a hazard to persons or properties, the SCLA Fire Department & Haz-Mat shall be notified.

26.16 In addition, all fuel storage on the Airport shall be regulated by NFPA 407, the UFC, and be approved by the City of Victorville Fire Chief or his designee.

SECTION 27. VEHICLE OPERATIONS:

27.1 No Person shall travel on any portion of the Airport except upon the roads, walks, or places provided for the particular class of traffic, nor occupy the roads or walks in such manner as to hinder or obstruct their proper use.

27.2 Unless escorted by an Authorized Person who is authorized to drive on the AOA, no Person shall operate a Vehicle on the Airport without successfully passing the SCLA driving test, being issued a Personnel Identification Badge, and possessing a valid state driver’s license, with the exception of the Airport ARFF, or Law Enforcement.

27.3 No Person shall operate a powered industrial vehicle without a Driving Permit on the Ramps, Taxiways, Runways or designated Roadways. An exception will be made for employees working within the exclusive leaseholders premises as authorized by the Airport Director.

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27.4 Persons who employ Individuals at the Airport shall be responsible to provide training for powered industrial vehicles and equipment, and for maintaining all training materials and records relating to the employee’s duties.

27.5 SCLA requires that employers "certify" that training and evaluations have been completed and maintained in the employee’s files up to 180 days upon separation of employment, and are available for inspection by the FAA, TSA and the Airport Operations and Security Department upon request.

27.6 Motor-vehicle traffic shall yield the right-of-way to Aircraft.

27.7 Every vehicle, excluding ARFF and construction vehicles operating within the Movement Area, shall have a flashing yellow beacon and carry a 2-way radio or be escorted by a vehicle so equipped. Construction vehicles must be identified with an orange and white flag and a 2-way radio or be escorted by an authorized vehicle so equipped.

27.8 Any accident, involving a motor vehicle, which results in a fatality or injury, or in property damage, shall be reported by the driver, or his representative, to the Airport Director.

27.9 No Person shall operate any motor vehicle on the airport in excess of 25 miles per hour except emergency vehicles responding to an emergency situation, or emergency vehicles involved in training or drills with prior ATC coordination. On passenger loading ramps, around parked Aircraft, and in areas immediately adjacent to hangars, speed shall not exceed ten (10) miles per hour.

27.10 Vehicles shall not be parked on the Airport other than in the manner and locations indicated by posted traffic signs and markings.

27.11 Unattended Vehicles may be parked only in designated Airport vehicle parking lots.

27.12 Vehicles parked other than specified in “27.10” and “27.11” above, may be moved by Airport personnel, and in such event a towing charge will be levied prior to releasing the Vehicle from impound. Neither SCLAA, VVEDA, the City, nor any of their respective officers, employees, agents, or designated representatives shall be liable for damages sustained by such Vehicles during said movement.

27.13 Motor vehicles shall not be driven on or across Runways or other portions of the Movement Area without permission from ATC Tower to do so. Two-way radio communications with Ground Control (on frequency 124.45) shall be required between the ATC Tower and such vehicles. Exceptions may be granted during maintenance activities as long as two-way radio Pg.16 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS communications control is maintained with at least one vehicle controlling the activity. ARFF vehicles may contact the ATC tower on the fire net per operational agreement.

27.14 Motor vehicles shall not be driven or parked upon, or within fifty (50) feet of Aircraft parking areas, ramp areas, or aprons without express approval of the Airport Director. Exceptions: aircraft support, airport maintenance, emergency vehicles, or fuel or service vehicles.

27.15 No Person may operate a motor vehicle or Aircraft in or on any portion of the Airport while under the influence of alcohol or drugs.

27.16 No Vehicle shall be operated on the Airport unless the Vehicle has been registered to drive on the Airport with Airport Operations. To register a Vehicle to drive on the Airport requires: a) proof of ownership, b) proof of vehicle registration with the Department of Motor Vehicles for State of California, or the Department of Motor Vehicles for another State; and c) proof of insurance as set forth in Section 37 of these Rules and Regulations.

27.17 Vehicles passing through electronic access perimeter security gates are required to stop just past the gate and wait for the gate to fully close before continuing. Vehicle operators should ensure no unauthorized persons enter the AOA while the gate is closing. Vehicle entry procedure is one vehicle per gate activation unless the vehicles following are under Escort.

SECTION 28. FIRE HAZARDS:

28.1 No Person shall light or smoke any cigarette, cigar, pipe, or similar object in the following Airport areas:
i. Within any hangar, or fuel handling or fuel storage areas; ii. Inside any Aircraft (whether or not such Aircraft are parked or stored) or within fifty (50) feet thereof;
iii. Within fifty (50) feet of any "No Smoking" sign posted; iv. Within any Vehicle operating on the AOA;
v. Within any building on the Airport.

28.2 No Person may use flammable liquids, solvents, or substances to clean any Aircraft, engine, part, or accessory thereof, within any hangar or building except a building specially designed for that purpose and approved in writing by the Airport Director. Such approval shall only be granted when the Airport Director approves the ventilation provisions, fireproofing, and fire-extinguishing equipment.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

28.3 No Person shall light or use any open flame for any purpose in any hangar or other building on the airport without the prior written consent of the Airport Director and Fire Chief.

28.4 No Person shall operate any welding or cutting equipment (electric or gas) anywhere on the Airport without prior written approval of the Airport Director and the SCLA Fire Department. A welding permit is required and may be obtained at the fire station.

28.5 No Person shall clean or degrease any Aircraft or part thereof except at or in a maintenance station properly equipped for such purposes, or in a space designated or authorized by the Airport Director.

28.6 No Person shall store or stock any material or substance, or lease or permit such activities in or on the Airport in such a manner, or of such nature, as to constitute a fire hazard. No Person shall keep, store or discard any flammable liquid, gas, signal flare, or other flammable material in any hangar, shop, building, room, enclosure, or other place on the Airport except in areas specially designated by the SCLA Fire Department for such purpose.

28.7 Lessees of hangars, shops, or other Airport areas shall provide suitable metal receptacles with hinged lids for the storage of oily waste, rags, and other similar rubbish. The lessee shall remove all such materials at frequent intervals.

28.8 Every lessee shall maintain his leased area clean and reasonably free of oil, grease, waste, other flammable materials and weeds.

28.9 Lessees shall provide, and maintain in proper working order, adequate and readily accessible fire extinguishers. Each such extinguisher shall bear a suitable tag, which indicates the most recent date of inspection or servicing.

SCLA Fire Department shall approve all extinguishers, their type, and location.

28.10 No Person shall move, relocate, or otherwise disturb any wheeled fire extinguisher on the Airport without the permission of the SCLA Fire Department unless specifically for emergency use.

28.11 All fires on the Airport, regardless of size, even if extinguished, shall be immediately reported to the SCLA Fire Department without delay.

SECTION 29. FUEL SALES:

29.1 No Person shall deliver aviation fuels or lubricants to, or dispense such fuel from, at, or upon the Airport without a lease or permit from the Airport Director.

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29.2 For the right, privilege and concession of making deliveries of all types of aviation fuels and lubricants, and other fuels, to any Person or location at or upon the Airport, other than to a central fuel person or location at or upon the Airport, other than to a central fuel service stand provided by the Airport, there is levied against such lease or permit holder, a flowage fee of ten cents (.10) for each gallon of fuel so delivered.

29.3 No fuel shall be stored anywhere on the Airport except approved by the Airport Director and the SCLA Fire Department.

SECTION 30. SECURITY:

30.1 Though not required, SCLA operates under the guidelines established by FAR Part 139 “CERTIFICATION AND OPERATIONS SERVING CERTAIN AIRCRAFT OPERATORS.” To this end, SCLA has prepared and implemented a security program that parallels the requirements contained in TSA 1542. This program includes the following elements: Personnel Identification Badging, controlled access to the Air Operations Area (AOA), driver licensing for personnel operating on the AOA, Vehicle registration, and perimeter security. All personnel operating at SCLA are required to abide by the SCLA Airport Master Security Program.

30.2 Personnel Identification Badges. Only those Individuals that have a need to be on the AOA will be issued a Personnel Identification Badge and granted unescorted access to the AOA and Restricted Areas. Individuals that require access must apply for a Personnel Identification Badge at the Airport Operations and Security Department. Lost or stolen Personnel Identification Badges must be reported to the Airport Operations and Security Department immediately. The application process includes:

1. A ten-year employment/education or unemployment history verification check, with five years verified by the Individual’s former employer(s), and

2. A CHRC, which is information gathered from the Federal Bureau of Investigation, provided to SCLAA after submitting a Live Scan Fingerprint to the Transportation Clearing House.

30.3 Fingerprints are collected by the Airport Security Coordinator, or his designated representative, at the expense of the Individual’s employer.

30.4 A Fingerprint-based Criminal History Records Check as described in TSA 1542.209 is required before authorized unescorted access to the Airport is granted. The results of the CHRC will be among the determining factors as to whether the issuance of a Personnel Identification Badge is granted.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

30.5 Identification for Authorized Persons contains the Individual’s photograph, name, company name, expiration date, identification number and color blocks that indicate authorized access areas granted to the badge holder.

30.6 Individuals who have a need to be within the Airport Operations Area (AOA) are required to attend an Airport Familiarization and Security Identification Display Area (SIDA) class and will be required to display a Personnel Identification Badge while operating in such areas.

30.7 The Airport Badging Office issues Non-Driving Identification Badge and Identification Badges with Driving Permit, upon completion of a SIDA Class and AOA Drivers Training and satisfactory score upon completion of a written test. Driving permits will be determined and issued in accordance with the applicant’s job related duties on the airport.

30.8 The Airport Security Coordinator will confirm or deny an applicant’s request for a badge based on verification of the CHRC and the
employment/education or unemployment history verification check, with five years verified by the employer, and the need of the applicant to access the AOA. If a Personnel Identification Badge is warranted, the Airport Security Coordinator, or his designated representative, will issue the Badge.

30.9 All Personnel Identification Badges issued by the Airport Operations and Security Department are the property of Southern California Logistics Airport Authority and MUST be returned upon expiration, separation of employment (for any reason), when the job function no longer requires Personnel Identification Badge, and upon demand of staff from the Southern California Logistics Airport. Any misuse or willful failure to return a Personnel Identification Badge is punishable by fine as dictated in the Airport Rules and Regulations. Personnel Identification Badges are non- transferable and must be used only by the Individual to whom they are issued.

30.10 No Individual shall enter the AOA of the Airport without a Personnel Identification Badge unless the Individual is accompanied by an Authorized Person with a Personnel Identification Badge who shall be fully responsible for the unbadged person being escorted. Fire department personnel responding to an emergency wearing uniforms or other identifying clothing, shall not be required to wear an identification badge.

30.11 No Authorized Person shall Escort any Individual who is not in the performance of job-related duties and who requests access to the Airport as a visitor without the consent and approval of the Airport Director. Person(s) denied access to the Airport by Airport security officers, must abide by the decision of the security officers under the direction of this rule. Visitor Escort must be conducted during normal business hours of the Airport Pg.20 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Operations and Security Department, unless prior approval of the Airport Director has been established

30.12 Authorized Persons shall always prominently display their Personnel Identification Badge while on the AOA. Failure to prominently display an issued Personnel Identification Badge while on the AOA shall constitute a violation for which a fine shall be assessed as set forth in Section 43, PENALTIES AND APPEALS.

30.13 Individuals who do not display a Personnel Identification Badge, and who are not under Escort by an Authorized Person displaying a Personnel Identification Badge, shall immediately be reported to the Airport Director and shall be escorted off the AOA by the Airport Director or his staff.

30.14 Authorized Persons who have been issued a Personnel Identification Badge and are involved in an accident while operating on the AOA will be asked to submit to a drug-screening test. Authorized Persons who refuse to submit to the drug-screening test will be considered as having failed the test and the Authorized Person will be considered to be under the influence of drugs or alcohol.

30.15 Controlled Access to the AOA. Any Airport Tenant that has direct access to the AOA, should, because of their immediacy of access, be considered part of the AOA. These Airport Tenants shall therefore take measures to protect access to the AOA. As required by TSA 1542.113 Airport Tenant Security Programs, the Airport Tenant must assume responsibility for specified security measures of the Secure Area, AOA, or SIDA. Airport Tenants are encouraged to develop individual security programs designed to meet the needs of their particular businesses. In all cases such security programs must be approved in writing by the Airport Director.

30.16 While on the AOA, customers and clients of the Airport or Airport Tenants must be under Escort at all times. Failure to provide an Escort may constitute the issuance of a Notice of Violation that could result in sanctions.

See Section 43, PENALTIES AND VIOLATIONS for a discussion on the scope of fines/penalties associated with violations of the Airport Security Program.

30.17 The Airport Operations and Security Department administers the licensing program for drivers on the AOA. This program involves a study element that describes the procedures for driving on the AOA at SCLA. A written test will be administered and all applicants must pass the test in order to receive a license to drive on the AOA.

30.18 Vehicle Registration for driving on the AOA. All Vehicles that operate on the AOA must be registered with the Airport Operations and Security Pg.21 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Department. All Vehicles that operate on the AOA will be issued a Radio Call Sign that must be utilized while on the AOA. Airport Standard Operating Procedure No. 200-01 describes the Radio Call Sign Procedure.

30.19 Perimeter Security. The Airport is surrounded by an eight-foot (8’) high chain link fence. Barbed wire is placed atop this fence. There are numerous locked gates that access the Airport perimeter. Airport Tenants that are situated on the immediate perimeter of the AOA must employ secured personnel doors.

30.20 All Persons that operate on the Airport are charged with the responsibility of maintaining the security of the Airport. To this end, Persons who observe breeches in security are to call said incidents to the attention of the Airport Operations and Security Department.

30.21 A Person’s responsibility under Section 30.20 includes breeches to the procedural elements of the Airport Security Program, as well as the physical elements of the Airport Security Program (perimeter fence, vehicle gates, etc.).

30.22 The issuance under this Section of either (i) a Personnel Identification Badge, or (ii) a Personnel Identification Badge with Driving Permit to drive on the AOA, shall be conditioned upon the express consent of the Individual to whom the badge is issued, to a drug and alcohol screening in the event that such Individual is involved in an accident while on Airport property.

30.23 In the event that an Individual to whom a Personnel Identification Badge or Personnel Identification Badge with Driving Permit has been issued (a) tests positive for the use of a controlled substance not prescribed by a physician or has a blood alcohol content equal to or in excess of .08, or (b) refuses to consent to a drug and alcohol screening, then such Individual’s Personnel Identification Badge and/or Driving Permit shall be revoked by the Airport Director.

30.24 A Personnel Identification Badge and/or Driving Permit which has been revoked under Section 30.23 of these Rules and Regulations will remain revoked until the Individual’s employer petitions the Airport Director in writing, to have said Individual’s Personnel Identification Badge and/or Driving Permit reinstated.

30.25 Reinstatement of a Personnel Identification Badge and/or Driving Permit which has been revoked under Section 30.23 of these Rules and Regulations remains the prerogative of the Airport Director; however, reinstatement will not be unreasonably withheld.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

30.26 Reinstatement of a Personnel Identification Badge and/or Driving Permit which has been revoked under Section 30.23 of these Rules and Regulations will depend on, as a minimum, the employer’s verification of a negative drug test as part of a return to duty test. Any Individual who has verified positive drug test results on two drug tests will not be permitted to thereafter work or drive on the AOA, regardless of whether such Individual is accompanied by an Individual properly in possession of a Personnel Identification Badge and/or Permit.

SECTION 31. AIRPORT SECURITY AREAS:

31.1 Unauthorized Entry and Exit: No Person shall seek entry to or exit from Airport Security Areas except through designated entrances and exits. No Individual shall seek entry to or exit from Airport Security Areas over, under or through fencing, walls, window, air or other vents.

31.2 Only Authorized Persons, or those Individuals under Escort, shall have access by any means to Airport Security Areas.

31.3 A Person performing an Escort must, at all times, be in a position to actively monitor, direct and control the movements and actions of the accompanied Individual(s).

31.4 No Individual shall enter/exit or allow another Individual to enter/exit into Airport Security Areas except by using his Personnel Identification Badge.

No Individual shall follow another Individual into an Airport Security Area without first using his or her Personnel Identification Badge through any electronic access installed at the entry/exit point. This provision does not apply to an Individual under Escort

31.5 No Individual shall drive a Vehicle into Airport Security Areas unless the Individual has used his or her Personnel Identification Badge to open any electronic access installed at the entry point. No Individual shall allow other Vehicles to follow or tailgate in Airport Security Areas. This provision does not apply to Vehicles under Escort.

31.6 No Person shall tamper with or in any way hamper the effective operation of Security Devices.

31.7 Security of Access Points: No Person shall leave open, propped or unsecured any door, gate or access point leading to or allowing access to Airport Security areas. No Person shall hold, prop or cause a door, gate or access point to be open beyond the period of time allowed by a Security Device unless an Authorized Person attends the door. When an Authorized Person is attending a security door, he or she must be physically present at the door and must use his or her Personnel Identification Badge to activate additional time for the door to be open.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS SECTION 32. RESPONSIBILITY OF AIRPORT TENANTS:

32.1 Adherence to the Security Rules and Regulations: Airport Tenants with access to Airport Security Areas on their leased area shall follow these Rules and Regulations by posting signs, approved by the SCLAA, which prohibit access into the Airport Security Areas. Airport Tenants with access to Airport Security Areas shall at all times keep the access secured or staffed in a manner that prevents unauthorized Individuals from accessing Airport Security Areas. Airport Tenants shall retain keys or other means of access to Airport Security Areas under their control and issue such access only to Authorized Persons.

32.2 Airport Tenants with access to Airport Security Areas shall appoint at least one employee of the Airport Tenant as the security contact primarily responsible for the Airport Tenant’s leased area which access Airport Security Areas. Airport Tenants shall advise the Airport Security Coordinator in writing of the Individual or Individuals at all times having such responsibility.

32.3 Airport Tenants must provide a quarterly employee roster to the Airport Operations and Security Department in the months of January, April, July and October, and immediately notify the Airport Operations and Security Department of employee separation.

32.4 Airport Tenants must immediately confiscate Personnel Identification Badges, with or without access media, as well as any keys that would allow access to the Airport, from Individuals upon separation of employment. Any misuse or willful failure to return a Personnel Identification Badge is punishable by fine as dictated in these Rules and Regulations.

SECTION 33. OTHER PROHIBITED ACTS:

33.1 Bypassing Security Screening Area: No Individual shall enter a Sterile Area through a Security Screening Area unless first going through equipment that has been installed for inspection of Individuals and their belongings. Armed federal and local law enforcement officers on official duties at the Airport, airport operations and maintenance personnel, and others exempted by the FAA do not have to be inspected, provided they follow FAA and TSA regulations.

33.2 Statements Against Aviation Safety or Security: No Person shall make a statement to another so as to indicate that the Person or another may have possession of a firearm, bomb or explosive device while at the Airport.

33.3 Interference with Airport Personnel: No Person shall intimidate, threaten, hinder or obstruct Airport Personnel or Airport Security Officers in the performance of his or her official job duties or lessen the ability of such person to perform his or her duties.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

33.4 Interference with Flight Operations: No Person shall intimidate, threaten, hinder or obstruct an aircraft crewmember in the performance of his or her official job duties or lessen the ability of such aircraft crewmember to perform his or her duties.

33.5 Unattended Baggage: No Person shall leave any bag, luggage, box or container unattended in the terminal areas of the Airport, which are accessible to the public.

33.6 Presenting a Weapon at Security Screening Area: No Person shall place firearm(s), explosive device(s), knife/knives or other FAA/TSA prohibited items that could be used as a weapon onto inspection equipment at a Security Screening Area without first declaring such item(s). Only Persons authorized by the TSA may test Security Screening Areas.

SECTION 34. ENFORCEMENT:

34.1 Notices of Violation: The Airport Operations and Security Department will conduct inspections and enforce violations of these Rules and Regulations, Minimum Standards, and any permits issued hereunder regarding activities at the Airport. All Personnel Identification Badge holders and persons with access cards will be subject to a Notice of Violation (NOV) when reasonable grounds exist to believe that Rules and Regulations, Minimum Standards or a permit have been violated, either by commission or omission.

34.2 NOV’s will be monitored and issued by Airport Operations and Security Department personnel or by recommendation from an Authorized Person of Authority. A copy of the NOV will be given to the Personnel Identification Badge holder, or the Person(s) observed committing the violation(s).

34.3 The NOV may serve as a notice only or may include a penalty ranging from suspension to revocation. Any violation of a severe nature as determined by the Airport Director will warrant immediate suspension or revocation of the Personnel Identification Badge. Severe violations include, but are not limited to, any violation that may result in property damage, injury, runway incursions, or other safety hazards, or that threatens the environment or public welfare.

34.4 The receipt of three (3) NOVs, which have not been appealed or that have been upheld upon appeal, within a twenty-four (24) month period will be considered grounds for revocation of the Personnel Identification Badge.

34.5 When an NOV or sanction is issued, a letter indicating as such will be sent to the Individual’s employer, advising the employer of the violation.

34.6 Upon written request, the Airport Security Coordinator may review and recommend modification of the NOV.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS SECTION 35. SUSPENSIONS:

An Individual’s authorization to use a Personnel Identification Badge may be suspended for any of the following reasons:

1. 2.

Violation of these Rule and Regulations.

Violation of any rule or regulation of SCLAA for which a criminal penalty may be imposed.

3. 4.

Violation while on Airport property of any law of the State of California or the United States for which a criminal penalty may be imposed.

Actions which interfere with or threaten the operation of the Airport, or the comfort, safety or convenience of passengers, Authorized Person’s employed by the City of Victorville, or otherwise constitute just cause for suspension.

35.2 The Airport Director or an Airport Security Coordinator shall issue written notice of the Suspension, which shall state the nature and date of the violation, the length of Suspension, and the date the Suspension shall begin and the Individual’s right to have a hearing pursuant to the provisions of Section 43 of these Rules and Regulations. The suspension may be for up to ninety (90) days as determined by the Airport Director or the Airport Security Coordinator.

SECTION 36. REVOCATION:

36.1 An Individual’s authorization to use a Personnel Identification Badge may be revoked for any of the following reasons:

1. Any act that seriously endangers property or Persons or indicates willful or reckless disregard for, and which has an immediate impact on the health, safety or welfare of the public or poses a serious threat to the security of the Airport.

2. A violation warranting Suspension where the Individual has had a previous suspension for the same or similar offense.

36.2 The Airport Director or Airport Security Coordinator shall issue a written notice of Revocation, which shall state the nature and date of violation, the date and Revocation shall begin, and the Individual’s right to a hearing pursuant to the provisions of Section 43 of these Rules and Regulations.

SECTION 37. LIABILITY INSURANCE:

37.1 Every Airport User shall carry insurance as required by their lease, sublease or permit to operate on Southern California Logistics Airport and as required Pg.26 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS by State and Federal regulations. Any person operating a vehicle within the fenced area of the Airport, who does not have a lease, sublease, or Operating Permit, is required to have comprehensive automobile insurance with combined single limits for bodily injury and property damage of not less than $1,000,000.

37.2 Airport Users shall provide Certificates of Insurance naming VVEDA, SCLA and Stirling Airports International as Additional Insured’s with respect to their lease, sublease or permit. These Certificates of Insurance shall also provide for a 30-day Notice of Cancellation for those policies listed on the Certificate of Insurance.

37.3 The Airport User shall formally advise its Insurers that all Vehicles in use with or without valid Airside Vehicle Permits are intended to be operated on that portion of the Southern California Logistics Airport premises known as Airside, and should those Insurers exclude, limit, or otherwise restrict coverage while the Vehicle is on Airside, the Occupant shall obtain and keep in full force and effect at all times, a policy of Aviation Liability insurance covering both license-plated and unlicensed plated Vehicles while on Airside
SECTION 38. ILLEGAL ACTIVITIES: No Person shall:

38.1 Take or use any Aircraft, aircraft parts, instruments, or tools pertaining thereto, which are owned, controlled, or operated by any other Person, while such Aircraft, parts, instruments, or tools are stored or otherwise left on SCLA, or within its hangars, building, or facilities, without the written consent of the owner/operator thereof, except upon satisfactory evidence of the right to do so duly presented to the Airport Director, or authorized by him or so ordered by a court of competent jurisdiction.

38.2 Land, takeoff, taxi, or otherwise operate any Aircraft on, at, or from SCLA when he knows such Aircraft is not operating properly, or is equipped with any part or safety device which is defective or unsafe. Deviations from this restriction shall only be permitted by specific authorization from the Airport Director and/or FAA if required, or his designated representative.

38.3 Operate any Aircraft on or at the Airport, or on any Runway thereof, when the Airport or Runway has been closed to traffic by the Airport Director or other legal authority, or when such closure has been indicated by the placement of an "X" at each end of the closed Runway.

38.4 Operate any aircraft on, at, or in the vicinity of SCLA in willful or wanton disregard for the safety of persons or property, whether his own or that of others.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

38.5 Engage in the performance of any aerobatics, stunt, or maneuver not necessary to a normal takeoff, landing, normal turn or level flight of the Aircraft, over or within one mile of the exterior boundaries of the airport without the permission of the Airport Director or ATC.

38.6 Engage in the sale of any goods, wares, merchandize, or services at or upon the Airport without first having secured from the Airport Director a lease or permit therefore, and paying any required fees for such lease or permit.

38.7 Board an aircraft at the Airport without the prior approval of the Aircraft’s owner or representative.

SECTION 39. AIRPORT CLOSURE:

39.1 The Airport Director is hereby directed and authorized to close the Airport, or portions thereof, or suspend operations related to the landing, takeoff, or taxiing of Aircraft during any period in which he determines that such operations, or their continuance, would be hazardous.

39.2 Causes for such closure could include, but would not be limited to, adverse weather conditions, runway maintenance or repairs, runway obstacles, fire, Aircraft or other accident.

39.3 The Airport Director or his designee shall immediately notify the Riverside Flight Service Station and issue a NOTAM, advising of the closure.

SECTION 40. THRU-THE-FENCE ACTIVITIES:

40.1 Thru-the-fence activities, defined as accessing the Airport from private land outside the airport perimeter for the purpose of utilizing or otherwise benefiting from the Airport, are strictly prohibited.

SECTION 41. SEVERABILITY:

41.1 Should any article, section, sub-section, sentence, clause or phrase of these Rules and Regulations be held invalid or unconstitutional for any reason, such decision shall not affect the remaining portion of these Rules and Regulations.

41.2 The SCLA Authority hereby declares that it would have adopted these Rules and Regulations and each article, section, sub-section, sentence, clause or phrase, regardless of the fact that any one or more articles, sections, sub- sections, sentences, clauses, or phrases be declared invalid or unconstitutional.

SECTION 42. DISMANTLING AIRCRAFT:

42.1 No Person shall dismantle an Aircraft of any type outside of a hangar unless they receive prior written approval from the Airport Director. Any Person permitted to dismantle an aircraft outside of a hangar must:

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

42.2 Submit a written request to the Airport Director describing the type of aircraft to be dismantled, the dismantling procedures to be employed, the procedures for disposing of all dismantled material, toxic material clean up and abatement procedures, and the schedule for dismantling an aircraft.

42.3 Conduct all aircraft dismantling within a fenced in area to prevent visual contact with the dismantling activity.

42.4 Return the area used for dismantling to its original condition as approved by the Airport Director in his/her sole discretion.

42.5 Procure a performance bond to ensure any contamination, remediation of contamination and the dismantling area is returned to its original state. The amount of the bond will depend upon the procedures set forth in the request and the potential exposure and land clean-up cost to the Airport.

42.6 Receive the prior approval of the SCLA Fire Department.

42.7 Adhere to all City of Victorville, State and Federal environmental regulations.

42.8 Upon receipt of the information set forth in 42.1 through 42.7 above, the availability of land to conduct dismantling and other airport operating requirements and/or constraints, the Airport Director will either approve the Aircraft dismantling request by issuing a written Letter of Permit with appropriate indemnities and airport protection provisions to the requesting person or business or deny the request by providing a Letter of Denial to the requestor.

SECTION 43. PENALTIES AND APPEALS:

43.1 Fixing penalties for violations: Any Airport User including, without limitation, sublessees, suppliers, contractors, guests, invitees, or others that do not adhere to or violates these Rules and Regulations shall be sanctioned.

43.2 Sanctions may include, but are not limited to, a fine paid to the Airport, denial of the use of the Airport for a specified period of time, and/or a referral to the Transportation Security Administration and/or Airport Authority Attorney with a recommendation for criminal prosecution.

43.3 In determining the sanctions to be imposed, the Airport Director may take into consideration any mitigating or aggravating factors that may exist including, without limitation, the number of previous violations and the cooperation of the person involved.

43.4 Fines shall be assessed from $100.00 to $10,000.00 per day per incident depending on the severity of the violation.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS

43.5 Should an infraction occur, and should the infraction and situation surrounding the infraction warrant, fines will be assessed on a graduated/increasing basis.

43.6 All fines assessed to a sublessee, or to a sublessee’s suppliers, contractors, guests, invitees, or others, will be added to a Sublessee’s monthly rent and subjected to late fees and default provisions as set forth in a Sublessee’s land or facility Sublease.

43.7 Fines assessed to Airport Users who do not have a land or facility Sublease at SCLA, shall be paid before the Airport User is permitted to use the Airport again.

43.8 Continuous violation of these Rules and Regulations shall result in denial to use the Airport. Attachment B provides an example of fines as may be applied.

43.9 Removal from Airport Premises: The Airport Director, or his designated representative, may order removal of anyone from the Airport who knowingly and willfully violates any provision of these Rules and Regulations.

43.10 Recourse under Tenant’s Lease: SCLAA may take action against Airport Tenants under their lease agreements irrespective of any other penalties under these Rules and Regulations.

43.11 RIGHTS OF APPEAL: Fines and other sanctions may be appealed to the Executive Director. Requests for appeal must be made in writing to the Executive Director within ten (10) business days from the date the fine was presented to the Airport User.

43.12 The Executive Director (or his designated representative) will convene an administrative hearing and shall serve as the hearing officer (the “Hearing Officer”). Failure of any Airport User to properly file an appeal shall constitute a waiver of its right to an administrative hearing and adjudication of the fine or any portion of the total amount of the fine.

43.13 The Airport User or other Person in receipt of the fine or sanction shall be provided a written notice of the date, time, and location of the hearing. The notice will include the date, time and nature of the alleged violation.

43.14 The hearing shall be conducted in an informal manner and strict rules of evidentiary procedure will not apply. The Hearing Officer may consider any evidence that is reasonably probative and aids in the determination of the facts.

43.15 Parties are entitled to be represented by an attorney of their choice, to bring witnesses, and present documentary evidence. Parties have the right to have Pg.30 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS all records or documents relevant to the proceedings provided to them at the cost of reproduction.

43.16 At the conclusion of the appeal hearing, and pursuant to the Hearing Officer’s authority, the Airport Director’s imposition of sanctions may be upheld, modified or reversed. Parties will be provided with the results of the hearing in writing, including any penalties imposed by the Hearing Officer. The decision of the Hearing Officer is final.

SECTION 44. EFFECTIVE DATE

44.1 These changes contained in the Southern California Logistics Airport Rules and regulations shall be of full force and effective immediately upon filing of same with proof of publication with approval of the Southern California Logistics Airport Authority.
____________________________
Peter R. Soderquist
Airport Director
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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Attachment A

SOUTHERN CALIFORNIA LOGISTICS AIRPORT
Airport Rates and Charges
Introduction / Guiding Principles:

A.1 In establishing a Schedule of Airport Rates and Charges, the Southern California Logistics Airport Authority (the “Airport Authority”) is required by federal regulations to ensure that charges are fair, reasonable and non- discriminatory. Further, Airport Rates and Charges are to be reasonably consistent with the rates and charges being applied by other airports for similar types of activities, unless there is a special situation unique to the Southern California Logistics Airport.

A.2 The Airport Authority fully recognizes the FAA prohibition against the diversion of Airport revenues for non-airport purposes. It is recognized that failure to collect fair and reasonable fees and market-based rents for the use of Airport property, facilities and equipment can be considered a form of Revenue Diversion. The Authority also recognizes the FAA requirement to establish a Schedule of Rates and Charges that will permit the Airport to be as self- sustaining as possible.

Airport User Fees Defined:

A.3 Aircraft Landing Fees: The Southern California Logistics Airport Authority (SCLA) has expended a significant amount of funds to provide aviation facilities for the benefit of aircraft owners and operators. Landing fees are assessed to help offset the cost of operating and maintaining the Airport’s runway, taxiway, and aircraft parking ramp areas. Landing fees are based upon the Certified Maximum Gross Landing Weight (MGLW) of the aircraft multiplied by the Airport Authority’s established landing fee rate per 1,000 pounds of Certified Maximum Gross Landing Weight.

A.4 Commercial Aircraft: The Airport Authority assesses a landing fee on each aircraft landing conducted by an airline or other commercial Air Carrier, operating under FAR Part 121 (airline), Part 129 (international airline), Part 135 (air taxi), or other similar regulation, regardless of the purpose of the landing.

A.5 Signatory Landing Fees: Signatory landing fees are assessed to an airline, or other large (over 75,000 lbs MGLW) commercial aircraft operator having a Signatory Operating Agreement with SCLA. To be eligible for Signatory Operating Agreement status, the operator must have one or more of the following:

Pg.32 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS i. A lease with the Airport Authority of a ground site
having at least 10,000 square feet or more that is used to accommodate the organization’s primary base of
business on Airport property.
ii. A lease with the Airport Authority, or an approved
sublease, of a building, or part of a building totaling at least 4,000 square feet that is used as the
organization’s primary base of operations on the
Airport.
iii. Commercial Airlines operating under the military
Civilian Reserve Air Force (CRAF) program.

A.6 Non-Signatory Landing Fees: Non-signatory Landing Fees are assessed at a rate of 125% of the Signatory Landing Fee rate for large commercial operators (over 75,000 lbs MGLW) using the Airport who do not have Signatory Operating Agreement status with the Airport Authority, or have an agreement, but do not meet any of the Signatory eligibility criteria specified in paragraph 2 above. The Non-Signatory Landing Fee is intended to compensate the Airport Authority for the operator’s use of the Airport’s runway and taxiway areas as well as compensation for the privilege of being able to access the airport to conduct business.

A.7 Private Aircraft: The Airport Authority assesses a landing fee on each aircraft landing conducted by large private operators (over 75,000 lbs MGLW) operating under FAR Part 91, or other similar regulation, regardless of the purpose of the landing. Landing fees for private aircraft that are operated under FAR Part 91 and are based at the airport under conditions set forth in a long term agreement with the Authority will be charged landing fees as required by that agreement.

Aircraft Parking Fees:

A8. Signatory Aircraft Parking Fees: Aircraft having Signatory status as defined in A.1 above, are not required to pay parking fees during the time an aircraft is in the loading/ unloading process (24 hour maximum). Signatory Aircraft are also exempt from aircraft parking fees on the weekend, and over national holidays, as long as the weekend/holiday parking occurs in the middle of the loading/unloading process. Signatory Aircraft that are not in the unloading/loading process, and/or use aircraft parking areas in excess of the 24-hour maximum, are required to pay established aircraft parking fees.

A9. Non-Signatory Aircraft: Non-signatory aircraft are required to pay established aircraft parking fees.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS A10. Private Aircraft: All private aircraft (both heavy and light) are required to pay aircraft parking fees. Aircraft that are based at the airport under conditions set forth in a long term agreement with the Authority will be charged parking fees as required by that agreement.

A.11 Aircraft Storage Fees: Aircraft storage fees are charged to aircraft that are stored on areas other than the main parking apron. Fees are payable under one of three different categories: under 50,000 lbs MGTW, narrow body aircraft, and wide body aircraft. Remote aircraft storage is occasioned by the many acres of closed runways and taxiways that make a suitable “hard stand” for aircraft parking. The availability of these areas is directly related to the longevity of these surfaces. As these surfaces fail to be usable for aircraft parking, they will be removed from the inventory of remote parking.

The Airport Authority makes no representation that it will maintain these surfaces and those businesses that store aircraft thereon do so at their own risk.

A.12 Fuel Flowage Fees: A substantial percentage of the fuel dispensed at SCLA is “pre-purchased” by large aircraft operators that enjoy discounts based on the large volumes of fuel these carriers purchase nationally. This pre- purchased fuel is stored in SCLA’s fuel farm to which SCLA assesses a storage fee. SCLA also assesses a flowage fee on each gallon of fuel delivered from the fuel farm to the aircraft.

A.13 Fuel flowage and fuel storage fees reflect the intent of the Airport Authority to generate reasonable revenues for the use of the airport’s fuel storage facility, while at the same time, encouraging aircraft operators to use SCLA as a base of operations.

A.14 All fuel sold at SCLA is subject to the described fuel flowage fees with following exceptions:

1. 2.

3. Non-Signatory Air Cargo Operators: Commercial Air Cargo Operators that are considered Non-Signatory as defined in Section A.1 above and pre-purchase fuel that is stored in the Airport’s fuel farm for use in their aircraft, shall pay flowage fees and storage fees.

Signatory Cargo Operators: Commercial Air Cargo Operators that meet the requirements of Signatory status as defined in Section A.1 above and pre-purchase fuel that is stored in the Airport’s fuel farm for use in their aircraft shall pay the appropriate storage fee.

Non-Commercial Signatory: Based operators (signatory) that are non-commercial (Part 91) will pay the appropriate storage fee and a modified flowage fee as provided in the operators lease agreement.

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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Southern California Logistics Airport
Schedule of Rates and Charges
Landing Fees:

Signatory airline (over 75,000 lbs MGLW) $ .85 per 1,000 pounds MGLW Non-signatory airline (over 75,000 lbs MGLW) $1.06 per 1,000 pounds MGLW Private aircraft (over 75,000 lbs MGLW)
Fueling Fees:
$ .85 per 1,000 pounds MGLW
(Flowage fee -$ .08 per gal; Storage fee -$ .02 per gallon) Aircraft Parking Fees: (commercial aircraft)
Signatory airline
Non-signatory airline
$200.00 per day
$200.00 per day
Transient Aircraft Tie down Fees: (general aviation aircraft; main ramp) Single engine . . . . . . . . . .. . .. . . . . . .

Multi engine . . . . . . . . . . . . . . . . . . . . .
$ 5.00 per day $ 80.00 per month
$ 10.00 per day $120.00 per month
Mid-weight aircraft (12.5K lbs to 25K lbs) $ 20.00 per day $200.00 per month Large aircraft (25Klbs to 100K lbs) $ 30.00 per day$300.00 per month Narrow body . . . . . . . . . . . . . . . . . . . . .$100.00 per day $1,000.00 per month Wide body . . . . . . . . . . . . . . . . . . . . . . . $200.00 per day $2,000.00 per month Wash Rack:

Any aircraft……………………………….........$ 40.00 per hour $240.00 per day Live Scan Fingerprint Transmission Fee Per Applicant for Criminal History Records Check:

Call Airport Operations at (760) 243-1915 for Fingerprint transmission fees.

Personnel Identification Badge
Personnel Identification Badge with or without access card……….…...$ 10.00 Lost Personnel Identification Badge …………………………………….$ 100.00 (Fees are subject to change)
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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Notes:

Parking charges for Signatory Airlines do not apply for the first 24 hours, weekends, or holidays. Transient aircraft tie down fees apply to aircraft remaining overnight. Transient aircraft remaining parked longer than overnight Military aircraft are exempt from paying landing, parking and storage fees.

Definitions:

Signatory –
Having a lease or sublease of a ground site or building space on the Airport in accordance with the Airport Authority’s Rates and Charges Policy; or, an airline having a contractual airline operating arrangement with an organization that has such a lease on airport property.

Non-signatory –
Those operators who do not have an On-Airport Lease Agreement with the Airport Authority in accordance with the Rates & Charges Policy.

MGLW – Maximum (certificated) Gross Landing Weight
MGTW – Maximum (certificated) Gross Takeoff Weight
Narrow body aircraft - i.e. B-727; B-737; DC-9; MD-80
Wide body aircraft - i.e. B747; B-777; DC-10; MD-11
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SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS Attachment B
SCLA

SCHEDULE OF FINES
B.1 In most situations, a sanction or fine will be levied upon the employer of the Individual involved in the infraction. All sanctions or fines assessed will be added to the employer’s basic monthly rent and subjected to late fees and default provisions as set forth in an Airport Tenant’s land or facility sublease.

Fines assessed to Airport Users who do not have a land or facility Sublease at SCLA, shall be paid before the Airport User is permitted to use the Airport again. Continuous violation of these Rules and Regulations shall result in denial to use the Airport.

B.2 The following schedule should be regarded as a suggested schedule of fines. The Airport Director has the sole discretion and authority to levy fines, their amount and final disposition.

B.3 For minor infractions related to vehicle operations on the AOA such as:

Speeding on the AOA. $100.00
Operating a vehicle on the AOA without:

Airport Issued I’D Badge or drivers permit, appropriate markings or two-way radio communication with ATCT.

Runway incursion.

Taxiway incursion.

For negligence resulting in, and failure to correct, FOD $100.00
$500.00
$300.00
$100.00
B.4 For breeches in security such as:

1. Leaving a perimeter gate unattended.

2. Failure to accompany non-badged person on the AOA.

3. Sharing a security code or vehicle gate card.

4. Bypassing Security.

5. Sharing a Personnel Identification Badge.

6. Losing a Personnel Identification Badge.
$100.00
$100.00
$300.00
$300.00
$300.00
$100.00
B.5 For miscellaneous infractions of the Rules and Regulations such as:

1. Smoking in a non-approved area. $100.00
$100.00
$100.00
$300.00
$100.00

2. Parking or storing aircraft in non-approved areas.

3. Performing aircraft maintenance in unauthorized areas.

4. Knowingly allow an unsafe condition to exist.

5. Bringing an unauthorized vehicle on the airport.

B.6 A Federal Aviation Administration (FAA) or Transportation Security Administration (TSA) fine levied at the SCLA may be directly forwarded to a tenant if such tenant action is cause for the FAA/TSA penalty Pg.37 of 38

SOUTHERN CALIFORNIA LOGISTICS AIRPORT RULES AND REGULATIONS A second violation of the above listed offenses will result in the doubling of the applicable fine. A third offense will result in the tripling of the applicable fine and a suspension of privileges until corrective actions are taken and documented.

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EXHIBIT C

SELECTED FAA RULES AND REGULATIONS
SCLAA Standard Lease Page 24 Anduril Building 685C

EXHIBIT C

SELECTED FAA RULES AND REGULATIONS

LICENSE PROVISIONS REQUIRED BY THE FEDERAL

AVIATION ADMINISTRATION

1. The Lessee, for himself/herself, his/her heirs, personal representatives, successors in interest, and assigns, as part of the consideration hereof, does hereby covenant and agree “as a covenant running with the land” that in the event facilities are constructed, maintained, or otherwise operated on the property described in this Lease for a purpose for which a Federal Aviation Administration activity, facility, or program is extended or for another purpose involving the provision of similar services or benefits, the Lessee shall maintain and operate such facilities and services in compliance with all requirements imposed by the Non-discrimination Acts and Regulations in the Pertinent List of Non-Discrimination Authorities set forth in Provision 19 hereof (as such may be amended), such that no person on the grounds of race, color, or national origin, will be excluded from participation in, denied benefits of , or otherwise subjected to discrimination in the use of said facilities.

2. The Lessee, for himself/herself, his/her heirs, personal representative, successors in interest, and assigns, as part of the consideration hereof, does hereby covenant and agree “as a covenant running with the land” that: (1) no person on the grounds of race, color or national origin shall be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities, (2) that in the construction of any improvements on, over, or under such land and the furnishing of services thereon, no person on the grounds of race, color, or national origin shall be excluded from participation in, denied the benefits of, or otherwise be subject to discrimination, (3) that the Lessee shall use the premises in compliance with all other requirements imposed by or pursuant to the Non-Discrimination Acts and Regulations in the Pertinent List of Non-Discrimination Authorities set forth in Provision 19 hereof (as such may be amended).

3. In the event of breach of any of the above nondiscrimination covenants, Authority shall have the right to terminate the Lease, and to reenter and repossess said land and the facilities thereon, and hold the same as if said Lease had never been made or issued. This provision does not become effective until the procedures of 49 CFR Part 21 are allowed and completed including expiration of appeal rights.

4. Lessee shall furnish its accommodations and/or services on a fair, equal and not unjustly discriminatory basis to all users thereof and it shall charge fair, reasonable and not unjustly discriminatory prices for each unit or service: PROVIDED THAT the Lessee may be allowed to make reasonable and nondiscriminatory discounts, rebates or other similar type of price reductions to volume purchasers.

5. Non-compliance with Provision 4 above shall constitute a material breach hereof and in the event of such non-compliance, Authority shall have the right to terminate the Lease Agreement, and the estate hereby created without liability therefor, or at the election of the Authority or the United States either or both said Governments shall have the right to judicially enforce provisions.