HomeMy WebLinkAboutC03-332 Mesa Airlines, Inc.'~
FIRST AMENDMENT
TO
EAGLE COUNTY AIR TERMINAL CORPORATION
"SIGNATORY AIRLINE-TYPE C"
TERMINAL BUILDING LEASE
THIS FIRST AMENDMENT to the Eagle County Air Terminal Corporation Signatory
Airline-Type C Terminal Building Lease (hereinafter "First Amendment") is made and entered
into this ~`wday of ~ , 2003, by and between Eagle County Air Terminal Corporation,
a not for profit 63-20 Corporation of the State of Colorado, hereinafter called "Corporation" and
Mesa Airlines, Inc., a corporation organized and existing under the laws of the State of Nevada
and authorized to do business in the State of Colorado, hereinafter called "AIRLINE."
RECITALS
The circumstances surrounding the making of this l+'~rst Amendment are as follows:
A. Air Wisconsin Airlines Corporation and CORPORATION entered into a Signatory
Airline-Type C Terminal Building Lease Agreement ("Agreement") on January 14, 2003 for a
one-year term.
B. Pursuant to Paragraph 15.1 of the Agreement Air Wisconsin Airlines Corporation
upon notice to CORPORATION assigned its interest in the Agreement to Mesa Airlines, Inc.
Mesa Airlines, Inc. as a result of that assignment and as successor in interest to Air Wisconsin
Airlines Corporation hereby states and affirms that it has assumed all obligations, duties, right
title and interest under that Agreement and agrees to be bound by the same.
C. Mesa Airlines, Inc. as the successor tenant to Air Wisconsin Airlines Corporation and
CORPORATION wish to extend that Agreement as amended for an additional three-year term.
Paragraph 18.9 of the Agreement provides that the Agreement maybe amended in writing and
executed by duly authorized representatives of the parties.
AGREEMENT
THEREFORE, based upon and in consideration of the recitals, promises and covenants
set forth herein and those set forth in the Agreement, the parties hereto agree to amend the
Agreement as follows:
1. Section 1.1 Definitions is hereby amended by the amendment of Sections 1.1K and
1N which paragraphs shall read as follows:
"K. "Signatory Airline" shall mean those airlines, including code sharing or
wholly owned subsidiaries of such airlines, providing AIR TRANSPORTATION to and from the
AIRPORT using the TERMINAL BUILDING that have executed similar residual type
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agreements to this AGEEMENT with CORPORATION covering the lease, use and occupancy of
facilities at the TERMINAL BUILDING with a term of three years, five years or at least ten
years."
"N. "Signatory Airline- Type C" shall mean those airlines, including code
sharing or wholly owned subsidiaries of such airlines, providing AIR TRANSPORTATION to
and from the AIltPORT using the TERMINAL BUILDING that have executed similar residual
type agreements to this AGREEMENT with CORPORATION covering the lease, use and
occupancy of facilities at the TERMINAL BUILDING with a term of three years."
2. Section 1.1 (A) the definition of "Affiliate" is hereby deleted.
3. Section 2.1 Term shall be amended to read as follows:
__._ ___"Section 2.1 Terffi. This Agr~Prnent_shall ~e~come ef~e.~tve at 1?~~l a~:na local
time on November 21, 2003, hereinafter called the "Ei~echve llate", and shall
continue for three years, expiring at 11:59 p.m. on December 1, 2006 subject to
prior termination as provided in Article 14 hereof. The parties agree that this is a
Signatory Airline- Type C Agreement as a result of such three year lease term."
4. Section 7.2 Base Rent and Base Rent Premium shall be amended to read as follows:
"Section 7.2 Base Rent. AIRLINE shall pay to CORPORATION an annual rent
("Base Rent") for AIRLINE'S exclusively leased premises and joint use premises.
AIRLINE'S annual rent consisting of Base Rent shall not exceed $765,000.
AIRLINE is considered a Signatory Airline-Type C for purposes of calculation of
Base Rent. The Base Rent shall be paid annually in four equal monthly
installments on December 1, January 1, February 1, and March 1 during the term
of this First Amendment."
5. Section 7.5 Rent Deposit shall be amended to read as follows:
"Section 7.5 Rent Deposit. AIRLINE shall pay a deposit equal to three months,
or one-quarter of the annual, whichever is larger, Base Rent prior to the
commencement of the lease term. This requirement shall be waived for an
AIlZLINE that has been current for a period of eighteen months in its payments to
CORPORATION and COUNTY."
6. Section 7.8 Passenger Facility Charges shall be amended to read as follows:
"Section 7.8 Passenger Facility Charges. No Passenger Facility Charges shall
be used for that portion of the TERMINAL BUILDING exclusively leased by
AIRLINE. No depreciation or amortization charges for facility costs funded from
the proceeds of a Passenger Facility Charge shall be included in the determination
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of rates for AIRLINE rentals and fees. Subject to Federal law enacted subsequent
to this Amendment, it is further agreed that AIRLINE acknowledges and agrees
that any Passenger Facility Charges held by AIRLINE are hereby deemed to be
held in trust by AIRLINE for the benefit of CORPORATION: '
7. Section 8.1 (A) Year-End Refund of Net Concession Revenue shall be amended to
read as follows:
"Section 8.1 Year-End Refund of Net Concession Revenue.
A.
Except as set forth hereafter, at the end of each FISCAL YEAR or part
thereof falling within the lease term, the CORPORATION will refund
AIlZLINE, along with other SIGNATORY AIRLINES, within sixty (60)
days of the close of the audit, 50% of any Net Concession Revenues. The
SIGNATORY AIRLINE' S share of Net Concession R PvPoue shall bo _ _ _
distributed to them prorata based on actual enplanements from the
TERMINAL BUILDING during such FISCAL YEAR. AIRLINE'S year-
end refund of Net Concession Revenue shall be subject to adjustment
according to the year-end reconciliation of the AIRLINE' S base rent
allocation recalculation further described in Section 8.2A. Furthermore, if
AIRLINE is in default of any section of the Agreement, as amended,
payment of any share of Net Concession Revenue determined by
CORPORATION to be due to AIRLINE shall be immediately withheld
from AIRLINE until such default is cured and any such Net Concession
Revenue share shall result in an immediate offset against any amounts due
to the CORPORATION. In the event that at the end of any FISCAL
YEAR or part thereof falling within the lease term at which time the
CORPORATION shall determine that there shall have accrued to the
AIRLINE a refundable share of Net Concession Revenue and the
AIRLINE shall, at that time, be the subject of a "Filing" (as that term is
defined hereafter) the AIRLINE'S refundable share of Net Concession
Revenue shall be held by the Corporation until the earlier of the dismissal
and closing of the Filing, the court-approved and authorized assumption of
the Agreement, or the court approved and authorized rejection of the
Agreement, in which event, the AIRLINE's refundable share of Net
Concession Revenue shall be collateral first for any pre-petition amounts
outstanding under the Agreement and then for any post- petition amounts
outstanding under the Agreement."
The remainder of Section 8.1 as set forth in the Agreement shall remain in full force and
effect.
8. Section 8.2 (A) Base Rent Allocation Among Air Transportation Companies shall be
amended to read as follows:
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"Section 8.2 Base Rent Allocation Among Air Transportation Companies.
A. Base Rent for all AIRLINE'S consists of the following three components calculated
annually:
1. EXCLUSIVE USE SPACE
2. JOINT USE SPACE
3. COMMERCIAL PASSENGER SERVICE RIGHTS PURCHASE
CORPORATION will calculate the base rent equivalent square footage rate (Base
Rental Rate) annually during the term of this lease by dividing:
(i) $2,150,000 (the amount of Airline rent projected to be needed by the
CORPORATION to fund operations and maintenance_expenses, depreciation of
.' - _- ~ '~ORPOR7~TION -runded assets, othei truscellan~oa~ c~~s debt 3r-vi~e
coverage and the debt operations and maintenance reserve requirement)
(ii) less a fixed amount of $300,000 from the CORPORATION applied to subsidize
and lower the SIGNATORY AIRLINES' total unallocated base rent
by the sum of the EXCLUSIVE USE SPACE and JOINT USE SPACE rented by all
AIRLINE's during the year. This Base Rental Rate will be used to calculate AIRLINE'S
Exclusive Use portion of Base Rent, by multiplying the EXCLUSIVE USE SPACE square
footage times the Base Rental Rate. The JOINT USE SPACE portion of the base rent for
AlItLINE is the base rental rate multiplied by the total square footage of all JOINT USE
SPACE rented less the annual debt service and coverage requirements for the purchase of the
commercial service rights from the fixed base operator at the Airport. The COMMERCIAL
PASSENGER SERVICE RIGHTS PURCHASE portion of the Base Rent for all AIRLINE's is
the annual debt service and coverage amount required to be paid by CORPORATION during
the year for the purchase of the commercial service rights from the fixed base operator at the
Airport. The annual Base Rent amount for all three components for AIRLINE will not be
more than the amount described in Section 7.2 during the term of the lease.
A Joint Use Formula will be used to prorate eighty percent (80%) of the JOINT USE
SPACE rent according to the ratio of the number of each SIGNATORY Al12LINE's enplaning
passengers at the TERMINAL BUII,DING during the most recent calendar year to the total
number of enplaning passengers of all SIGNATORY AIRLINE users of the space during that
same year. The remaining twenty percent (20%) of the JOINT USE SPACE rent is to be
divided equally among all SIGNATORY AIRLINE USERS of the space. Solely for purposes
of this formula, the twenty percent (20 %) equal pro-rata share shall not apply to any
SIGNATORY AIRLINE operating only aircraft weighing less than thirty thousand (30,000)
pounds gross landed weight.
For new SIGNATORY AIRLINES, the twenty percent (20%) portion of the JOINT
USE SPACE rent will be paid monthly, calculated on an annualized basis; the eighty percent
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(80 %) portion will be paid monthly per enplanement at a rate calculated by dividing the
previous calendar year's eighty percent (80%) JOINT U5E SPACE rent by the total
SIGNATORY AIRLINES enplanements during that year, and will be subject to adjustment
during the year-end reconciliation.
A formula will be used to prorate one hundred percent (100 %) of the COMMERCIAL
PASSENGER SERVICE RIGHTS PURCHASE portion of the Base Rent according to the
ratio of the number of each SIGNATORY AIRLINE'S enplaning passengers at the
TERMINAL BUII,DING during the most recent calendar year to the total number of
enplaning passengers of all SIGNATORY AIRLINE users during that same year.
As part of the annual year-end reconciliation and prior to the year-end refund of Net
Concession Revenue, a recalculation of AIRLINE'S base rent allocation will be prepared by
the CORPORATION, and CORPORATION shall provide a final accounting of the prior
year's base rent allocation based on actual enplanements at the TERMINAL BUILDING - _ . - -- -
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during the most recent fiscal year: If amounts were paid in excess of the recoucile~l base rent
recalculation amount, the excess amount will be added to the AIlZLINE'S refund of Net
Concession Revenue. If amounts actually required are in excess of base rent amounts paid,
this excess amount will be deducted from the year-end refund of the Net Concession Revenue.
If the excess amount of base rent exceeds the year-end refund of AIRLINE'S share of Net
Concession Revenue, CORPORATION shall invoice AIItLINE and AIRLINE shall pay the
net amount due for the difference between the year-end base rent excess and the year-end
refund of Net Concession Revenue so long as as said amount is within the base rent of
$765,000.00.
Adjustments to this base rent amount due, based on the prior year reconciliation
pursuant to this Article 8, shall apply without the necessity of formal amendment of the
Agreement.
CORPORATION has calculated the base rent equivalent square footage rate based upon
the actual space constructed and rented by all AIRLINEs. The calculation for the first year of the
lease term under this First Amendment is attached hereto as Exhibit "B" which maybe amended
from time to time as set forth herein."
The remainder of Section 8.2 as set forth in the Agreement shall remain in full force and
effect.
9. Section 9.1(C) is hereby deleted.
10. Section 15.1 Assignment and Subletting is hereby amended to read as follows:
"Section 15.1 Assignment and Subletting. AIRLINE shall not assign this
Agreement, or any part hereof, or any of the privileges recited herein, in any
manner whatsoever, nor sublet any portion of the premises leased hereby, without
the prior written consent of CORPORATION, which consent shall not be
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unreasonably withheld, provided that AIRLINE acknowledges that
CORPORATION need not consent to any such assignment or subletting at any
time, and to the extent that, CORPORATION has space available to lease to AIlt
TRANSPORTATION companies."
11. Section 15.4 Bankruppcy is hereby amended to read as follows:
"Section 15.4 Bankruptcy. Notwithstanding Section 15.1 in the event that a
petition for relief under Title 11 of the United States Code or under any similar or
successor federal, state or local statute is filed by or against the AIRLINE (a
"Filing"):
(A) The AIRLINE shall give the CORPORATION immediate written
notice of the Filing;
_ _ ___ _ .
(B) The AIRLINE will"promptly confirm the outstanding amount of
any obligations hereunder due the Corporation as of the date of Filing;
(C) The AIRLINE will fully and timely perform all obligations arising
hereunder commencing as of the date of the Filing and thereafter for the purposes of this provision
and of Section 365(d)(3) of Title 11 of the United States Code, the parties agree that, in the event that
the AIRLINE shall be the subject of a Filing commenced on a day (the "Filing Date") when the rent
due forthethen-current month is outstanding and unpaid, the obligation for rent during that month in
which the Filing shall have occurred shall be considered to accrue and be due pro rata on a daily
basis during that month and the AIlZLINE will pay the CORPORATION the pro rata rent for the
period from the Filing Date through the end of that month within thirty (30) days of written demand
therefore by the CORPORATION.
(D) The AIRLINE will promptly determine whether it intends to
assume or reject the unexpired term of this Lease, if any, and shall promptly advise the
CORPORATION of such determination;
(E) The AIRLINE will not seek to delay the date by which it will make
the determination under (D) above and obtain any necessary third-party authorization (including
court approval) therefor beyond the 60~ day following the date of the Filing without the prior
express consent of the CORPORATION;
(F) If the AIRLINE determines that it wishes to assume the Lease, the
AIRLINE will cure all defaults, compensate the CORPORATION for all damages incurred as a
result of such defaults, provide the CORPORATION with adequate assurances of future
performance and comply with any and all other statutory or legal requirements prior to the
effective date of such assumption;
(G) If the AIRLINE determines that it wishes to assume the Lease and
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assign the Lease to athird-party, the AIRLINE shall seek the consent of the CORPORATION
which consent shall not be unreasonably withheld and shall provide to the CORPORATION all
pertinent information with respect to the proposed assignee, cure all defaults, compensate the
CORPORATION for all damages incurred as a result of such defaults, provide the
CORPORATION with adequate assurances of future performance through the proposed assignee
and comply with any and all other statutory or legal requirements;
(H) IF the AIRLINE wishes to reject the unexpired term of the Lease, if
any, the AIlZLINE will not seek to have the effective date of such rejection determined to be a
date earlier than that date on which (i) the AIRLINE shall have returned control and possession
of the premises to the CORPORATION in the condition and on the terms set forth herein and
relevant to the redelivery of possession to the CORPORATION, and (ii) the AIRLINE shall have
obtained court approval and authorization for such rejection; and the AIRLINE shall fully and
timely pay all rent and other charges through the date of such rejection; and
_. _ _. _
(I) The AIRLIlQE shall be "deemed to have expressly consented to the
modification of the stays of proceedings in any Filing in the event of any post-Filing default by
the AIlZLINE under the terms of this Lease for the purpose of allowing the CORPORATION to
exercise any default rights or remedies arising from such default "
12. Article 17 (1) and (2) are hereby amended as follows:
"(1) President
Eagle County Air Terminal Corporation
P.O. Box 850
Eagle, CO 81631
Telephone: (970) 524-8246
Fax: (970) 524-8247
and also
Eagle County Attorney
P.O. Box 850
Eagle, CO 81631
Telephone: (970) 328-8685
Fax: (970) 328-8699
(2) MESA AIRLINES, INC.
ATTN: Hal Fahrenbruch
410 N 44~' Street Suite 700
Phoenix AZ 85008
Telephone: (602) 685 4078
Fax: (602) 685 4578
Email: hal.fahrenbruch@mesa-air.com
13. The parties hereby state and reaffirm that Air Wisconsin Airlines Corporation and
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CORPORATION entered into a Signatory Airline-Type C Terminal Building Lease Agreement
on Januazy 14, 2003 for cone-yeaz term. Pursuant to Pazagraph 15.1 of that Agreement Air
Wisconsin Airlines Corporation assigned its interest in the Agreement to Mesa Airlines, Inc.
Mesa Airlines, Inc. hereby represents and wazrants that it has assumed all obligations, duties,
right, title and interest in, to and under the Agreement and agrees to pay, perform, observe and be
bound by all of the covenants, agreements, provisions, conditions and obligations of the tenant
under that Agreement. Mesa Airlines, Inc. fiuther states and affirms that it has the authority to
enter into this First Amendment and agrees to be bound by the terms hereof.
14. Any reference to Exhibit "A" in the Agreement or this First Amendment shall mean
the Exhibit "A" which is attached to the Agreement and incorporated herein by reference thereto.
15. Any reference to Exhibit "B" in the Agreement or this First Amendment shall mean
the Exhibit "B" which is attached to this First Amendment and incorporated herein by reference.
i 6. 'The terms of the Agreement shall-eontinue in full force and erect except as modified
by this First Amendment.
IN WITNESS WHEREOF the parties hereto have executed this First Amendment on the
day and year first written above.
CORPORATION:
EAGL O AIR TERNIINAL
CORr ' O ~~
By:
Arn ni, President
AIRLINE:
MI
99?
By:
G:~DHM~AIItPOR1lMesaAirGroup~Mesaamend2.DOC
EAGLE COUNTY AIR TERMINAL CORPORATION
ECATALRENT0304c.123 Exhibit B
Calculation of Terminal Rent for Ski Season 2003-04
(No Rent Pr®mium with 3 Year Leas®s for UIX,De1ta,NW~CO; Subsidy Provld®d)
30-Jul-03
Exclusive and Joint Use Space; Rate/Sq Ft Calculation
Exclusive
Sg Ft Rate/Sg Ft Space Rent
American 4,512 $38.92 $175,620
United Express 2,918 $38.92 113,577
Delta 1,082 $38.92 42,114
Northwest 865 $38.92 33,668
Continental 1,825 $38.92 71,034
Total Exclusive Space/Rent
Total Joint Use Space
Total Exclusive and Joint Space
Terminal Rent per Section 8
Less Temporary Subsidy
Total Exclusive and Joint Space
Calculated Rental Rate/Sq Ft
Terminal Rent Net of United
Less Exclusive Space Rent
Total Joint Rent to Allocate
Less FBO Business Purchase Joint Rent
Total Joint Space Rent to Allocate
11,202 $436.013
38,328
47.530
$2,150,000
(300,000)
$1,850,000
47,530
$38.92
$1,850,000
(436,013)
$1,413,987
(631,750)
20% 80%
$782.237 $156447 $625 790
Joint Space Rent Allocation
Joint
20% Equal 2002 Actual Market 80% Allocated Space
Share Enplanements Share Share Rent
American $31,289 80,046 47.3% $295,835 $327,124
United Express 31,289 41,548 24.5% 153,554 184,843
Delta 31,289 16,509 9.7% 61,014 92,304
Northwest 31,289 15,088 8.9% 55,762 87,052
Continental 31,289 16,133 9.5% 59 625 90,914
Total $156.447 169.324 100.0% $625 790 $782.237
FBO Business Purchas® Joint Rent Allocation
FBO
FBO Business
Market Business Purchase
Share Purchase Joint Rent
Amartcan 47.3% $631,750 $298,653
United Express 24.5% $631,750 155,016
Delta 8.7% $631,750 61,595
Northwest 8.9% $631,750 56,294
Continental 9.5% $631,750 60,192
100.0% $631.750
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EAGLE COIiNTY AIR TERMINAL CORPORATION
ECATAI.RENT03o4c.123 EXhibit B
Calculation of Terminal Rent for Ski Season 2003-04
(No Rent Premium with 3 fear Leases for UEX,De1ta,NW~CO; Subsidy Provided)
30-Jul-03
Components of Alrllne Terminal Rent
(Excludes Refund of Net Concession Revenue Share After Year End)
1st Year 2nd Yr & Later
American (10 teasel: _ Annual Payments (4) Payments (12)
Base Rent -Exclusive $175,620
Allocated Base Rent -Joint (2G-% Equal Shares) 31,289
Allocated Base Rent -Joint (k 3'a Enplanements) 295,835
Allocated Base Rent- FBO 6'!:°ness Purchase (0%h00%) 298,653
Less Adjustment Due to AA $150,000 Cap (51,397)
Total American Rent
$750.000 $62.500
Unted Express (3 Year Leasel:
Allocated Base Rent -Exclusive $113,577
Allocated Base Rent -Joint (20°lo Equal Shares) 31,289
Allocated Base Rent- Joint (80% Enplanements) 153,554
Total Space Rent $298,420
Base Rent Premium (00%) p
Allocated Base Rent -Business Purchase (0°/d100%) 155,016
Total United Express Rent
$453.436 $113 359
Delta (3 Year Lease);
Allocated Base Rent- ExdusNe $42,114
Allocated Base Rent -Joint (20% Equal Shares) 31,289
Allocated Base Rent -Joint (80% Enplanements) 61,014
Total Space Rent $134,418
Base Rent Premium (00%) p
Allopted Base Rent- FBO Business Purchase (0%/100%) 61,595
Total Delta Rent
$196.013 $49.003
Northwest (3 Year Leaset:
Allocated Base Rent -Exclusive $33,668
Allocated Base Rent -Joint (20% Equal Shares) ~ 31,289
Allocated Base Rent -Joint (80% Enplanements) 55 762
Total Space Rent $120,720
• Base Rant Premium (00%) p
Allocated Base Rent - FBO Business Purchase (0%/100%) 56,294
Total Northwest Rent
$177.014 $44 253
Continental (9 Year Leasel:
Allocated Base Rent -Exclusive $71,034
Allocated Base Rent -Joint (20% Equal Shares) 31,289
Allopted Base Rent -Joint (80% Enplanements) 59,625
Total Space Rent $161,948
Base Rent Premium (00%) p
Allocated Base Rent - FBO Business Purchase (0%/100%) 60,192
Total Continental Rent
Total Airline Rent:
5222.141 $55 535
Total Base Rent -Exclusive $436,013
Total Allocated Base Rent -Joint 782,237
Total Base Rent Premium 0
Allocated Base Rent- FBO Business Purchase (0%/100%) 631,750
Less Adjustment Due to AA $750,000 Cap (51,397)
Total Rent
$1.798.603 $262.151 $62 500
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