FEDERAL AVIATION ADMINISTRATION UNITED STATES DEPARTMENT OF TRANSPORTATION 

### ----------------------------------------------------------------------------------}{ UNITED AIRLINES, INC., Complainant,


### v. THE PORTAUTHORITY OFNEW YORKANDNEWJERSEY, Respondent. 

### ----------------------------------------------------------------------------------}{ DECLARATION OFFREDRICKLONGERNECKER I, FredrickLongemecker, declare as follows: 

### A. Introduction DocketNo. FAA-16-14-13

1. I submit this declaration in support ofthe motion ofthe RespondentThePort AuthorityofNewYorkandNewJersey ("the PortAuthority") for summaryjudgment dismissingthe Complaintherein. 2. I holdthe position ofManager, Properties & Commercial Development, for Newark Liberty International Airport ("EWR") and Teterboro Airport. Ihave heldthatposition since June 2014. Myjobresponsibilities includethe following: serving as headnegotiatorfor lease agreements withmajortenants, includingbutnotlimited leases for aircargo facilities, fixed base operators, and passengerterminal facilities; overseeinglease administration and development; responsibilityfor managing annual revenue generatedthrough agreements atEWRand Teterboro Airports; reviewingtenant developmentplans; supervisingpreparationofEWR financial models, project schedules; developing plans for efficientuse ofspace, reviewtenant constructiontimetables; responsibility for ensuring compliance withthe terms and conditions of all agreements including accounts receivable; and coordinatingthese oversight andmanagement

1responsibilities withall other applicable PortAuthority departments includingbutnot limitedto Law, Comptrollers, and Treasury. 3. From December2003 to June 2014, I heldthepositionofPrincipalProperty Representative, EWRandTeterboro Airports. Inthisposition, I served as leadnegotiatorwith majortenants at both airports. Thesetenantsincludedpassenger airlines, air cargo operators, and fixed base operators. Inthis position, I coordinated my activities withthe following Port Authority departments: Treasury, Law, Comptrollers and the Secretary's Office. 4. From October2000 to December2003, Iheldthe position ofSeniorProperty Representative for EWRandTeterboro Airports. Inthisposition, I was responsible for negotiation, management and administration ofterms and conditions ofairlines tenants and service providers for EWR and Teterboro Airports. Theseresponsibilities includedreviewing and establishing changes to flight fees and fuel fees for approval as appropriate at Teterboro Airport, developingnewbusiness agreements and acting as point ofcontact for airporttenants. 5. The statements inthis declaration are basedupon mypersonal knowledge and upon reviewofinformation contained inbusiness records ofthePortAuthority. 6. The Port Authority was createdin 1921 by a Compactbetweenthe States ofNew York andNewJerseyto develop publictransportation, terminals and other facilities of
commercewithinthe statutorilydefined PortDistrict. Pursuantto the 1921 Compact and subsequentbi-state legislation, thePortAuthority owns and/or operatesthirty-three (33) such facilities, including airports, bus depots, marine terminals, interstatebridges andtunnels and, throughits wholly-owned subsidiary, thePortAuthorityTrans-Hudson Corporation (PATH), an interstate railway. Among these facilities is EWR.

27. The PortAuthorityoperates EWRpursuantto a lease withthe City ofNewark,New Jersey. 8. Airlinepassengers who depart from orarrive atEWRuse oneofthreepassenger terminals, designatedA, B, and C. Terminals A, B and C are each sub-divided into subterminals which are designated A-1, A-2, A-3, B-1, B-2, B-3, C-1, C-2 and C-3. 9. Complainantoperates outofsub-terminalsA-1 andA-2 inTerminal A in accordance withLeaseAN-535 andANB-056 and sub-terminals C-1, C-2, C-3 in Terminal C in accordancewithLeaseANA-170. Complainantrefers to LeaseANA-170 asthe "MasterLease." 10. Complainant also operates out ofTerminalBand oecupies space pursuantto Space PermitANC-184, dated December 1, 2010. Terminal B is the designatedterminalfor international flights. Complainant's Terminal B operations are tracked andthe corresponding flight fees are calculated andpaidin accordance withthe provisions ofLeases ANB-056 and ANA-170. Seepara. 30 below. 11. Attached as ExhibitA is lease ANA-170, attached as ExhibitB is lease ANB-056 and attached as ExhibitCislease AN-535. Exhibits A, B, and Carelocatedonthe compactdisc accompanyingthis declaration. Redacted from Exhibits A, B and C is proprietaryinformation. B. Complainant atEWR 12. Priorto its merger with ContinentalAirlines Inc., ("Continental"), United Air Lines Inc., ("United") 1operated outofEWRin accordance withlease agreements withthe Port Authority since 1969, orfor morethan40 years. Its mergerpartner, Continental, has operated outofEWRunder lease agreements since 1987. Thoselease agreements nowinclude, and have always includedprovisions governingtherecovery ofthe costs for its use ofthepublic aircraft

1Asusedherein, "Complainant"refers toUnited and Continental as a merged entity.


### 3facilities and includedthe flight fee formula. As more fully setforth belowthese leases are setto expire in2018,2028 and 2033 withthe flight fee formula setto expire in2018. Seeparas. 19, 20, 27, 29, 32 and 33 below. 13. OnMarch 31, 2013, Unitedmergedwith Continental. Continental continuedas the surviving corporation ofthemerger andthenchanged its nameto UnitedAirlines Inc. The financial statements ofUnitedAirLines, Inc., and Continental are nowcombined attheir historical costfor all periodspresented beginning on October 1, 2010. Forthepurposes ofthis declaration,I will refer to themergedentityas Complainant and as United 

### and Continental respectively when discussingtheir lease historypriorto themerger. SeeEx. D Form 8-KUnited ContinentalHoldings Inc., ReportMarch 31, 2013; See Complaint

**at~** 33. 14. Complainant'srightsto operate atEWRare reflected inthe lease agreements with the PortAuthority described above executedprior to themerger. Duringthe mergerresulting in the formation ofComplainant, Continental requested thatthe PortAuthority confirminwriting thatthemergerwouldnottriggerterminationofthe agreements bytheresulting assignment of suchleasesto United. On September 30,2010,the PortAuthority in its reply assuredthat, if providedtherequisite materials needed for any applicable assignment, the mergerwouldnot resultina terminationofthose agreements. See Ex. E Corr. D. KagantoN. Foxhall (09/30/20I0). 15. Each ofLeaseANA-170, ANB-056 andAN-535 sets forth the sametwo componentsthatcomprisedthe flight fee andinclude Schedule C as an attachment setting forth the methodfor calculatingthe flight fee. Seeparas. 20, 24 and 29 below. 16. The flight fee is madeup oftwo factors a PublicAircraftFacilities Charge Factor ("PAF Factor") and anAirport Services Factor Charge ("Airport Services Factor"). The PAF

4FactorandAirport Services Factor are combined and thenmultipliedby an airline's total maximum gross take-offweight ofdeparting aircraft for a year, inthousands ofpounds, to determine that airline's flight fee for the year. The PAF Factor and Airport Services Factor are eachcomprised ofa setformula2 17. Lease ANA-170has been amended (or "supplemented") 27 times, Lease ANB

- 056has been supplemented 8times and LeaseAN-535 has beensupplemented29 times. I will reviewthe significantmilestonesreflected inthese agreements and their supplements for these threekeyleases. These supplements reflect both airlines evolving relationship withthePort Authority regardingthe paymentofflight fees priorto the merger whichformed Complainant. Significantly, as discussedmore fully below, eachairline byexecutingthe supplements choseto extendthe application ofthe flight fee formulauntil December 31,2018 despite havenbeen giventhe opportunitiesto avoid doing so. 18. Continental and Unitedthroughout their 40 years ofoperating atEWRnegotiated major supplements to theirrespective leases. The history ofLeases ANA-170, ANB-056 and AN-535, includingkey Supplements, 15, 17, to Lease ANA-170 and Supplement24to AN-535, contradictComplainant's assertioninits Complaintthatneither airline hadthe opportunityto discuss ornegotiate flight fee methodology. See Complaint

**at~** 33,

**~** 120,

**~** 121. These supplements addressedfinancial investments and financing inthehundreds ofmillions of dollars, base rentals, added or surrender space, modifiedbase rentals and added fees that reflected major development atEWRsuchas the Monorail Fee and Phase lACharge Factor. In eachofthe aforementionedleases and corresponding supplements bothUnited and Continental accepted and agreedto extendthe applicability ofthe flight fee formulauntil December 31,

2 The accompanyingDeclarationofJosephR. Garcia sets forth a description ofthe specific components ofeachfactor contained intheflight fee formula.


### 52018. Moreover, both airlines agreed to implementationofa newcomponent ofthe flight fee, the Phase 1A ChargeFactor, andthe implementationofthe new EWRMonorail Fee. 

### C. United's Lease and the FlightFees Expiration and Extension 19. Lease AN-535 hasbeen supplemented overtwenty-nine (29) times during the last 40 years andhas always containedprovisions governingthepaymentofflight fees to cover United'suse ofthepublic aircraft facilities and included Schedule C that sets forth the methodologyfor calculatingtheflightfees. This lease andthe applicability ofSchedule C expire

onDecember 31,2018. 20. United enteredinto Lease AN-535 dated October7, 1969, withthePortAuthority for use ofTerminal A facilities at EWR. AN-535 provides for calculation ofEWRflight fees using the same formula as setforth inLease ANA-170. SeeEx. F Lease AN-535 §16 and Schedule C. See also para. 24 below. December 31, 1996 was the scheduled expirationdate for Lease AN-535 andthe obligationto payflight fees. See Ex. GLease AN-535 

### § 7(b); Effective
as ofMarch 1, 1972, with SupplementNo.4, United extendedthe term ofthe lease andthe flight fee formula from December 31, 1996 to December 31, 1998. See Ex. H Lease AN-535 SupplementNo.4§ 5 (03/1/1972). Effective as ofJanuary I, 1995, United entered into SupplementNo. 24 to AN-535, whichextendedthe applicability ofthe flight fee formulated until December 31, 2018. See Ex. I Lease AN-535 SupplementNo. 24 §13 (04/18/1995). 21. InSupplementNo. 24 to AN-535, United agreedto the addition ofboththeEWR Monorail Fee to permitthePortAuthority to recover the costs ofconstructingthe EWR AirTrain, and added the Phase !ACharge Factortothe flight fee to recover costs associated with construction ofcertainEWRroadways. See Ex. J Lease AN-535 SupplementNo. 24 

### §2 Schedule M (!), § 9(a), § 6(a) (04/18/1995).



### 6

### D. Continental's Lease and the FlightFees Expirations and Extensions 1. TerminalC 22. Effective as ofJanuary 11, 1985, People Express AirlinesInc., ("People Express") entered into LeaseANA-170withthePort Authorityfor atermof(25) twenty-five years for its operations out ofAreas C-1 and C-2 ofTerminal C. Complainantrefers to ANA-170 as the Master Lease. See Complaint at

**~** 33. PeopleExpress assigned its leaseto Continental, withthe Assignment andAssumptionofLeaseANA-170 effective as ofAugust 15, 1987 (Assignment andAssumption) withthe PortAuthority consenting attached as ExhibitK. 23. From 1987 onward, Continental continuedto operate underANA-170 and continuedto expandoperations outofEWRin accordance withANA-l70'sprovisions. Continental has executedno less thantwenty-seven (27) supplements to ANA-170 addressing its expanding activities atthe EWR. Also effective as ofAugust 15, 1987, Continental entered into SupplementNo. 6to ANA-170, modifying certainterms and conditions such as rental commencement dates, insurance amounts, and adding a provisionregarding notice offlight fees, among other items. See Ex. L Lease ANA-170 SupplementNo.6§ 4, 

### §5 (a),§ 8(a)-(c), § 13 (08/15/1987). 24. Section 53 ofLeaseANA-170 entitledPayment ofFlightFees sets forththe flight fees and corresponding methodology for their calculationin Schedule C. Furthermore, Section 53 sets December 31, 1998 as the expirationfor theflight fee provisions contained in Schedule C. In pertinentpart Section 53 ofANA-170 states: "forthe portion oftheterm subsequentto December 31, 1998, the PortAuthority andLessee shall negotiate ingood faith towardthe establishment ofprovisions coveringthe determination offlight fees payable bythe Lessee for the portion of theterm commencingJanuary 1, 1999 throughthe expirationdate oftheterm of the letting hereunder and uponestablishment ofthe same Lessee shallpayflight fees in accordance withsaidprovisions for saidportionofthe term. Iftheparties

7do notreach suchagreement, the Lessee shallpay flight fees in accordance with the PortAuthority's Schedule ofCharges for said portion ofthetermcommencing January 1, 1999." See Ex. M LeaseANA-170 §51, Schedule A, SectionI, §53 and Schedule C. 25. Effective as ofJanuary 1, 1995, Continental entered into SupplementNo. 15 to LeaseANA-170. SupplementNo. 15 not only extendedthe lease term for AreaC-3 but also includednewbaserentals, addedthe EWRMonorail Feepermittingthe Port Authority to
recoverthe costs ofconstructionfor the EWRAirTrainand also addedthe Phase lACharge Factorto recover costs associated withthe construction ofcertainroadways. 3 Priorto the expirationofthe flight fee formula scheduledfor December 31, 1998, Continental in Supplement No. 15 agreedto continue to use the methodology setforth in Schedule C and extendedits applicationto March 31,2013. See Ex. N Corr. (MasterLease Agreement ANA-170 SupplementNo. 15 (11112/1995) andCertificate ofOfficer OfContinental Airlines Inc., (06/26/1995); See Ex. 

### 0 LeaseANA-170 SupplementNo. 15 § 2 ScheduleM (I), § 8 (a)-(d), § 11, 

### § 16 (a),(b) (03/20/1995). 26. Effective as ofSeptember 1, 1999, with SupplementNo. 17, Continental extended the term for the Area C-3 lease again, agreedto modifybaserentals, and agreed to extend the flight fee provisions setforth in Schedule C from March 31, 2013 to December31, 2018. See Ex. PLeaseANA-170 SupplementNo. 17 § 30 (09/01/1999). 27. In SupplementNo. 17; Continental and PortAuthority again agreed to negotiate in "goodfaith to establishprovisions coveringthe determination offlights fees payableby the Lessee." Inthe event theparties couldnotreach, an agreement Continental agreed thatit "shall

3 The accompanying DeclarationofJoseph R. Garcia sets forth a description ofthe specific fees and components ofthe flight fee formula.

8pay flight fees inaccordancewiththe PortAuthority's Schedule ofCharges [
...] commencing January 1, 2019." See Ex. PLeaseANA-170 SupplementNo. 17 

### § 30 (09/0111999). 28. InSupplementsNo. 15 and 17 Continentalmade significant changes tothe financial terms ofLeaseANA-170; such changes includedmodificationsto baseterminalrentals, adding the EWRMonorail Fee, addingthe Phase 1A Charge Factor, and providing for significant investment. Continental didnottakethese opportunitiesto alterthe original components ofthe flight fee formula as setforth in Schedule C, butinsteadagreedto extendits applicationto December 31,2018. 2. Terminal A 29. OnAugust 10, 1999, Continental continuedto expanditspresence atEWRby executing Lease ANB-056, effective as ofAugust 1, 1999 and agreedto leasefrom the Port Authority five (5) gates and accompanying space within Terminal A. Lease ANB-056 expires

onDecember31,2018. See Ex. Q LeaseANB-056 §7, §14 and Schedule C. InLeaseANB056, Continental agreedto adheretotheprovisions ofANA-170 (for Terminal C) withregardto flight fees so long as it operated out ofTerminal C, and agreedthat evenifitno longeroperated out ofthatfacility, its flight fees wouldbe calculated in accordance with Schedule C ofANA170. In either event, Continental agreedthat at all timesprovisions ofthe flight fee formula and Schedule C would apply. See Ex. Q LeaseANB-056 §7, 

### §14and Schedule C. 3. TerminalB 30. Terminal B is theterminal designatedfor international arrivals atEWR. Priorto the merger, onlyContinental operated arrivals into TerminalB. Upon opening ofits own international facility in Terminal C, Continental operated outofTerminal B, pursuantto SupplementNo. 17 to ANA-170 inwhich Continentalreservedthe rightunderthat agreementto

9continue to use its slots at Terminal B. Continental submitsmonthlyactivityreports for arrivals inTerminalBandpays flight fees as setbyLease ANA-170. SeeEx. R Lease ANA-170 SupplementNo. 17 

### §49 (b) (09/01/1999). 

### E. Major InvestmentMilestones for Continental and United at EWR. 31. With SupplementNo. 8effective as ofJune 2, 1989, Continental addedArea C-3 to Terminal C. See Ex. S LeaseANA-170 SupplementNo. 8 § 1, § 2 (06/02/1989). Inthe late 1990'sContinental embarked ona major expansion ofits operations atTerminal C, expanding the Terminalto facilitate international arrivals and departures. Itinvested approximately $730,360,000.00

**"~th** a bond issuance inthis expansionandthis expansionresulted inthe current form ofTerminal C-3. SupplementsNo. 15 and 17to LeaseANA-170 set forth Continental's investmentinthis expansion, its financing, and address its share ofthe costs associatedwiththeEWRAirTrainconstruction and operation andincorporation ofthePhase !A ChargeFactor. Seepara. 32, belowand 25 and 26 above. 32. Continental's SupplementNo. 17 to Lease ANA-170 reflects its extensiveprogram to upgrade and develop Terminal C-3. This programincludedconstruction ofapproximately 325,000 thousand square foot concourse, a newFederal Inspection Services facility, new baggagehandling and sortfacility, andrenovation ofexistingpassenger facilities suchas the Presidents Club, public restrooms, relocation ofadministrative offices, baggage claim areas, ticketcounters andreconfiguration offacilities to improve efficient air traffic. SupplementNo. 17 also setTerminal C-3'sleaseterm expirationfor March 31, 2028. SeeEx. T LeaseANA-170 SupplementNo. 17 

### §2 (a),§ 6 (a), (b)(!) (i)-(xiii) (09/01/1999); Ex. UNewJerseyEconomic DevelopmentAuthority SpecialFacility Revenue Bonds (Continental Airlines Inc., Project) Series 1999 09/15/1999 seepgs 1-8).

1033. Continental's4 investmentinEWRcontinued



### whe~ it executed SupplementNo. 28, effective as ofDecember 31, 2012. SupplementNo. 28 reflects Complainant's investmentof approximately $150,000,000.00 dollars inTerminals C-1 and C-2to further expand andupdate the terminal facilities. SupplementNo. 28 also extendedtheterms ofTerminal C-1 and C-2 until March 31, 2033 and Terminal C-3 is setto expire March 31, 2028. See Ex. V Lease ANA-170 SupplementNo. 28 

### § 1, 

### § 3(a) (12/3112012), Seepara. 32 above. ; SeeEx. W UnitedExtends NewarkAgreement, commits $150Mto its Hub. 

### F. Continental's Treatment ofIts EWRLeases DnringBankruptcyProceedings 34. OnApril!, 1992, Continental was underreorganizationunderChapter 11 ofthe United States Bankruptcy Code. Nevertheless, rather thanrejecting LeaseANA-170 under Section362 ofthe Bankruptcy Code, Continental reaffirmedLease ANA-170 without a modificationto the flight fee formula and extendedthe leaseterm among otheritems when it executed SupplementNo. 10. This supplementreflected that Continentalfried for bankruptcy, extendedthe leasetermfor Terminal C-3 andthatreflected Continental's commitmentto operate out ofTerminal C-3 while it surrendered certain areas under the leaseholdto thePortAuthority. SeeEx. X Lease ANA-170, SupplementNo. 10 (04/01/1992) 

### § 1(a), (b), 

### §4(a),(b), 

### § 5(a). 35. OnJune 1, 1993, Continental andPortAuthority entered into a stipulation addressing Continental's assumptionunder Section 362 ofthe Bankruptcy Code ofcertain leases for its operations atEWRandLaGuardiaAirports. Inthis stipulation, Continental assumed Lease ANA-170, whilerejecting others such as Lease ANA-093 forportions oftheNorth Terminal at EWR. OnOctober 1, 1993, the United States Bankruptcy Court for the Districtof

4 SupplementNo. 28 effective as ofDecember 31, 2012lists Continental as the lessee. Executionofthis supplementoccurredpriorto completionofthe merger and Continental's name change onMarch31, 2013.
11Delaware entered its order approving Continental'smotion for the assumptionofcertain agreements andthe corresponding stipulations includingthe June I, 1993 stipulationbetweenthe PortAuthority and Continental. See Ex. Y StipulationBetweenContinental Airlines, Inc., and the PortAuthority ofNewYorkandNewJersey for theAssumptionofCertainUnexpired Leases andExecutory Contracts (6/1/1993); In re ContinentalAirlines, Inc., etal., Chapter II CaseNo. 90-932 through 90-984, OrderPursuantto II U.S.C. 

### § 365 ApprovingAssumption of CertainExecutory Contracts and UnexpiredLeasesUponthe Effective Date ofthe Planof Reorganization and Approving Certain Stipulations withLessors (IO/l/I993). 

### G. United's Treatment ofIts EWRLeases DuringBankruptcy Proceedings 36. OnJune I7, 2005, United was under reorganizationunder Chapter II ofthe United StatesBankruptcy Code. Onthat date, thePortAuthority, United and Air Canada executed a partial assignment ofcertainfacilities under Lease AN-535 with assumption and consent ("Assignment"). This AssignmentreflectedUnited's proposed actionto assume certainleases withthePortAuthorityincludingAN-535 subjectto the bankruptcy's court approval. The modification included a surrender ofspace and changesto fees and rentals, butdidnotinclude a modificationto the flight fee formula. SeeEx. Z Partial AssignmentunderLetterAgreement withAssumption and ConsentLeaseAgreementNo. AN-535 (6/I7/2005). 37. TheUnited States Bankruptcy Courtfor the NorthernDistrict ofIllinois Eastern Division entered an order approving United's assumption ofcertain leases and agreements for its operations at EWRincluding Lease AN-535 while amending certainprovisions ofthelease. This includedpayments ofcreditfrom the PortAuthorityfor investmentbyUnitedinthe terminal and an agreement for assignment ofcertain gates andtermination ofcertainrentals, rates and fees for the space assigned. See Ex. AAIn re UAL Corporation, etal., Chapter II

12Case No. 02 B-48191, Stipulation orderAssuming CertainUnexpired Leases ofNon-Residential Real Property and Partial AssignmentThereofwith respect to Newark Liberty International Airport Pursuantto Section 365(a) ofthebankruptcy code. I declare nnder the penalty ofperjury nnder the laws ofthe United States ofAmericathat thatthe foregoing is true and correct. Executed atNewark, NewJersey, on February 9, 2015.

13Form 8-K 8-K 1 d514659d8k.htm FORM 8-K 

# UNITED STATES SECURITIESAND EXCHANGE COMMISSION Washington, D.C. 20549 

# FORM8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(0) OF THE SECURITIES EXCHANGE ACT OF 1934 Date ofReport (Date ofearliestevent reported): March 28,2013 

# UNITED CONTINENTAL HOLDINGS, INC.

Delaware Delaware Delaware (State or OtherJurisdiction ofIncorporation) 

# UNITED AIRLINES, INC. UNITED AIRLINES,INC. (Exact Name ofRegistrant as Specified in its Charter)

001-06033 001-11355 001-10323 (Commission File Number) 233 S. Wacker Drive, Chicago,IL60606 233 S. Wacker Drive, Chicago,IL60606 233 S. Wacker Drive, Chicago,IL60606 (Address ofPrincipal Executive Offices) (Zip Code) (312) 997-8000 (312) 997-8000 (312) 997-8000 (Registrant's telephone number, including area code) N/A (Former Name or Former Address, if Changed Since Last Report.) 36-2675207 36-2675206 74-2099724 (I.RS. Employer Identification No.)

Check the appropriate box below ifthe Form 8-K filing is intendedto simultaneously satisfythe filing obligation ofthe registrant under any ofthe following provisions: D Written communicationspursuant to Rule 425 under the Securities Act (17 CFR 240.425) D Soliciting material pursuantto Rule l4a-l2 underthe Exchange Act (17 CFR240.14a-l2) D Pre-commencement communicationspursuantto Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) D Pre-commencement communicationspursuantto Rule l3e-4(c) underthe Exchange Act (17 CFR 240.13e-4(c))

http://www.sec.gov/Archives/edgar/data/!00517/000119312513140583/d514659d8k.htm[2/5/2015 11 :52:34 AM]Item 1.01 Entry into a MaterialDefinitive Agreement. OnMarch 28, 2013, ContinentalAirlines, Inc., a Delaware corporation ("Continental") and a wholly-owned subsidiary ofUnited Continental Holdings, Inc. ("UAL"), andUnitedAirLines, Inc., a Delaware corporation ("United") and a wholly-owned subsidiary ofUAL, entered into anAgreement andPlan ofMerger (the "Merger Agreement") providing for themerger ofUnited with andinto Continental (the "Merger"). OnMarch 31, 2013, United mergedwith andinto Continental, with Continental continuing as the surviving corporation ofthe Merger and as a wholly-owned subsidiary ofUAL. Uponthe closing ofthe Merger onMarch 31, 2013, Continental's name was changed to "United Airlines, Inc." (the "Survivor"). As ofApril!, 2013, UAL,the Survivor and The Bank ofNewYorkMellon Trust Company, N.A., as trustee (the "Trustee"), entered into a First Supplemental Indentureto the Amended andRestatedIndenture dated as ofJanuary II, 2013 among UAL, United andtheTrustee (the "2013 Indenture") in which the Survivor assumedthe obligations ofUnited as guarantorunderthe 2013 Indenture andwithrespectto $326 million aggregate principal amount of6%Notes due 2026, $326 million aggregate principal amount of6% Notes due 2028 and $400 million aggregate principal amount of8%Notes due 2024, each ofwhich were issued by UAL and guaranteed byUnited. Also as ofApril I, 2013, UAL, the Survivor and theTrustee entered into a First SupplementalIndentureto the Indenture dated as of July 25, 2006 among UAL, United and theTrustee (the "4.50% Convertible Notes Indenture") inwhichthe Survivor assumed the obligations of United as guarantorunder the4.50% Convertible Notes Indenture and with respectto $156 million aggregate principal amount of4.50% Senior Limited-SubordinationConvertible Notes due 2021, which were issued byUAL and guaranteed by United. The foregoing descriptions oftheMergerAgreement and supplemental indentures in this [tern 1.01 do notpurport to be complete and are qualified intheir entirety byreference to the Merger Agreement, which is filed as Exhibit 2.1 hereto andincorporated hereinbyreference, and theFirst Supplemental Indenture to the 2013 Indenture and First Supplemental Indenture to the4.50% Convertible Notes Indenture, which are filed as Exhibits 4.1 and4.2, respectively, hereto and incorporated hereinbyreference. Item2.01 Completion ofAcquisition orDisposition ofAssets. Effective March 31, 2013, pursuantto theMerger Agreement, United mergedwith and into Continental, with Continental continuing as the surviving corporation ofthe Merger andchanging its name to "United Airlines, Inc."In accordance with theMergerAgreement, at the effectivetime oftheMerger, each outstanding share ofUnited common stock immediatelypriorto the Merger was cancelled and retired and no consideration was delivered in exchange therefor. Eachoutstanding share ofContinental common stock immediatelypriorto theMerger remained outstanding and was unaffectedby theMerger. The foregoing description ofthe Merger inthis Item2.01 doesnotpurport to be complete and is qualified in its entiretybyreference to theMerger Agreement, whichis filed as Exhibit 2.1 hereto andincorporatedhereinbyreference. Item2.03 Creation ofa Direct Financial Obligation or an Obligation under an Off-Balance SheetArrangement ofa Registrant. The information described in the second, third and fourth paragraphs underItem 1.01 above is incorporated hereinbyreference. In addition, byvirtue ofthe Merger, the Survivor assumedby operation oflawall ofUnited's obligationsunder all notes issued byUnited and all creditagreements, loan agreements and other contractsto whichUnited is a party, including butnot limitedto all equipment notes previously issued by United in its enhanced equipmenttrust certificate ("EETC") financings ofaircraft. OnMarch 31, 2013, the aggregate principal balance of suchequipmentnotes issued in connection withUnited's 2007-1 EETC financing was $505 million at interest rates ranging from LIBORplus 2.25% per annum to 7.336% perannum. As ofMarch 31, 2013, the aggregate principal balance ofsuchequipmentnotes issued in connection with United's 2009-1 EETC financing was $419 million at aninterest rate of 10.4%per annum, andthe aggregate principal balance ofsuchequipment notes issued in connection with United's 2009-2 EETC financing was $587 million at interestrates of9.75% (inthe case of$518 million ofsuch notes) and 12% (inthe case of$69 million ofsuch notes). Formore information concerningthe assumed obligations, see (i) "Note 14-Debt" to the CombinedNotes to ConsolidatedFinancial Statements inUnited'sAnnual Report on Form 10-Kfor theyear ended December 31, 2012 (the "2012 10-K"), which Note is includedin Exhibit 99.1 hereto and incorporatedherein byreference and (ii) Items 1.01, 1.02, 2.03 and 9.01 in the Current Report onForm 8-K filed byUAL, United and Continental onMarch28, 2013, which are incorporatedhereinbyreference. Additionalinformation can also be found in "Item 7, Management's Discussion and Analysis-Liquidityand Capital Resources" ofthe 2012 10-K.
Item 5.03 Amendments toArticles ofIncorporation or By-laws; Changein FiscalYear. In accordance with the provisions ofthe Merger Agreement, at the effective time ofthe Merger, the certificate ofincorporation ofthe Survivorwas amended and restated to read in its entirety as set forth in Exhibit 3.1 hereto (the "Survivor Certificate ofIncorporation"). The Survivor Certificate ofIncorporationwas approved byUAL, the sole stockholder ofContinental, onMarch22, 2013 and affects the following changesto the certificate ofincorporation ofContinental in effect immediatelyprior to the effective time ofthe Merger: (i) changes the name of Continentalto "UnitedAirlines, Inc." and (ii) revises thelimitation ofliability provisionto eliminate orlimit thepersonal liability ofdirectors to the fullest extentpermittedbythe General CorporationLaw ofthe State ofDelaware (the ''DGCL") inthe event ofany amendment to theDGCL authorizing corporate action further eliminating orlimiting thepersonal liability ofdirectors. http://www.sec.gov/Archives/edgar/data11005!7/000119312513140583/d514659d8k.htm[2/5/2015 11:52:34 AM]Fonn 8-K
Jn accordance withtheprovisions oftheMerger Agreement, at theeffective time oftheMerger, the by-laws ofthe Survivor were amended andrestated to read in theirentirety as set forth in Exhibit 3.2 hereto (the "SurvivorBy-laws"). The SurvivorBy-laws include the following provisions, which are amended orin addition to theprovisions contained in theby-laws ofContinental in effectimmediatelypriorto the effectivetime ofthe Merger: (i) theBoardis authorizedto tal(e any action without ameetingifallmembers consentthereto in writing orby electronictransmission; (ii) shares ofthe Survivor's stock may be certificatedoruncertificated; and (iii) the Chairman, ChiefExecutive Officer or Presidenthas the authorityto vote the securities ofany othercorporationwhich are owned orheldby the Survivor. The foregoing descriptions ofthe Survivor CertificateofIncorporation and SurvivorBy-laws in this Item5.03 do notpurportto be complete and are qualified intheir entiretybyreference to the Survivor Certificate ofIncorporation and SurvivorBy-laws, which are filed as Exhibits 3.1 and 3.2 hereto and incorporatedhereinbyreference.
Item 9.01 Financial Statements andExhibits. (a) FinancialStatements of BusinessesAcquired. Pursuantto Rule 3-05(b) ofRegulation S-X, Exhibit 99.1 to this Curreut Report onForm 8-Kpresents the consolidatedbalance sheets ofUnited as ofDecember 31, 2012 and 2011 andthe related statements ofconsolidated operations, comprehensive income (loss), cash flows and stockholder's deficit for each ofthethreeyears in theperiod ended December 31, 2012, together with the report ofindependentregistered public accounting firms thereon. The successoris viewed as the acquirerin the Merger followingthe legal form ofthe transaction and, therefore, the historical fmancial statements ofUnitedhavebeen included pursuantto Rule 3-05(b) inthis Form 8-K ofthe successor. The notes to these fmancial statements are combinednotes relating to thefinancial statements ofUAL and Continental in additionto the financial statements of United,because this was thepresentationusedin the 2012 10-K. However, for purposes ofthisForm 8-K, information inthe notes to the United fmancial statements includedin Exhibit 99.1 relatingto the financial statements ofUAL orContinental shallbe deemed excluded from suchnotes. (b) Pro Forma FinancialInformation. The Merger represents a transactionbetween entities under common control and United is considered the predecessor entity for accounting purposes. Transactions between entities under common control are accounted for as ifthetransaction occurred at the beginning ofthe earliestperiod presentedunder whichthe entities were nnder commoncontrol, andprior years areretrospectively adjusted to furnish comparative information similarto thepoolingmethod. The pro forma financial statementshave beencombinedwith United as the predecessor entity because it was the first ofthetwo subsidiaries thatwas controlledbyUAL,theparententity. Exhibit 99.2 to this Current Report on Form 8-Kpresentstbe followingUnaudited Pro FormaCondensed Combined Financial Information ofUnited and Continental, whichhas beenpreparedin accordance with Article 11 ofRegulation S-X: Unaudited Pro FormaCondensedCombined Balance Sheet as ofDecember 31, 2012; Unaudited Pro FormaCondensedCombined Statements ofOperations for the years ended December 31, 2012, 2011 and 2010; and Notes to Unaudited Pro FormaCondensedCombined Financial Statements.
(d) Exhibits. Exhibit Number 2.1 3.1 3.2 4.1

4.2
99.1

99.2 Description Agreement andPlan ofMerger, dated as ofMarch28, 2013, by and between Continental Airlines, Inc. and United AirLines, Inc. Amended and Restated Certificateoflncorporation ofUnitedAirlines, Inc. Amended and RestatedBy-laws ofUnited Airlines, Inc. First Supplemental Indenture dated as ofApril l, 2013 by andamong United Continental Holdings, Inc., United Airlines, Inc. and TheBank ofNew YorkMellon Trust Company,N.A., as trustee, to theAmended and Restated Indenture dated as ofJanuary 11, 2013 First Supplemental Indenture dated as ofApril], 2013 by and among UnitedContinental Holdings, Inc., United Airlines, Inc. and The Bank ofNew YorkMellonTrust Company,N.A., as trustee, to theIndenture dated as ofJuly 25, 2006 Consolidated Balance Sheets ofUnited as ofDecember 31, 2012 and 20ll andtherelated Statements ofConsolidated Operations, Comprehensive Income (Loss), CashFlows and Stockholder's Deficit for eachofthethree years in theperiod endedDecember 31, 2012 andthe notes thereto, togetherwith the report ofindependentregisteredpublic accounting firms thereon Unaudited Pro FormaCondensedCombined Financial Statements ofUnited and Continental
SIGNATURES Pursuantto the requirements ofthe Securities Exchange Act of1934, as amended, the Registrant has duly causedthis report to be llv.'WW.sec.gov/Archives/edgar/data/l00517/000ll9312513140583/d514659d8k.htm[2/5/2015 ll:52:34 AM]Fonn 8-K signed onits behalfbytheundersignedhereunto duly authorized. UNITED CONTINENTALHOLDINGS, INC. UNITED AIRLINES, INC.* UNITED AIRLINES, INC.

Date: April3, 2013 By: lsi John D. Rainey JohnD. Rainey Executive VicePresident and ChiefFinancial Officer * By United Airlines, Inc. (£1k/a Continental Airlines, Inc.) as successorbymergerto United Air Lines, Inc.
Exhibit Index Exhibit Number 2.1 3.1 3.2 4.1

4.2
99.1

99.2 Description Agreement and Plan ofMerger, dated as ofMarch28, 2013, byand between ContinentalAirlines, Inc. and United Air Lines, Inc. Amended andRestated Certificate oflncorporation ofUnited Airlines, Inc. AmendedandRestated By-laws ofUnited Airlines, Inc. FirstSupplementalIndenture dated as ofApril!, 2013 byand among United Continental Holdings, Inc., United Airlines, Inc. and The Bank ofNewYorkMellonTrust Company, N.A., as trustee, to the Amended and Restated Indenture dated as ofJanuary II, 2013 First Supplemental Indenture dated as ofApril!, 2013 byand among United ContinentalHoldings, Inc., United Airlines, Inc. and The Bank ofNewYorkMellon Trust Company,N.A., as trustee, to the Indenture dated as ofJuly 25, 2006 ConsolidatedBalance Sheets ofUnited as ofDecember 31, 2012 and 2011 and therelated Statements ofConsolidated Operations, ComprehensiveIncome (Loss), CashFlows and Stockholder's Deficit for each ofthethreeyears in the period ended December 31, 2012 andthe notes thereto, togetherwiththe report ofindependentregistered public accoWlting fmns thereon Unaudited Pro FormaCondensed Combined Financial Statements ofUnited and Continental

http://www.sec.gov/Archives/edgar/data/100517 /000119312513140583/d514659d8k.htm[2/5/2015 11 :52:34 AM]September30,2010

Ms. NeneFoxhall SeniorVice President Communications and GovernmentAffairs Continental Airlines 1600 Smith StreetHQSEO Houston, TX 77002 DearNene: 

# ~PORTAUTHORmOF NY& NJ

This letter is 

### in further response to your letterofSeptember I0, 2010 to SueBaerregardingthe mergerbetween ContinentalAirlines and United AirLines, and is a supplement to myletter dated September 21,2010. ThePortAuthorityhereby states thatthe mergerbetween Continental Airlines andUnitedAir Lines shall not, byitself, constitute an event oftermination ofanyofthe respective agreements listedbelow pursuantto the corresponding sectionthereof: Agreement FacilityName or Description ANA-040 MaintenanceComplex [Hangars 54, 55C, Engine BuildUp (EBU) Bldg. 101, Material StoresBldg. I00] 

### ' ANA-170 Terminal C

ANA-326 GSE 154 ANA-370 ! Chelsea Kitchen ANA-957 Hangar 56 ANB-028 Cargo Bldg. 344 ANB-056 TerminalA ANB-990 Satellite Kitchen

. ANC-069 Cargo Expiration Section Date 4/30/2027 20(a)(5)

3/3112013 24(a)(8) [Cl/C2] (Supp. 3/31/2028 17) [C3] 12/31/2024 · 19(a)(8) 2/28/2015 24(8) 4/30/2027 23(a)(8}_ 12/3112024 22(a)(8) 12/3112028 45(a)(6) 7/31/2012 20(a)(8) 10/31/2012 23(a)(8)

225ParkAvenue South New

**Yor~** NY I0003Ms. NeneFoxhall SeniorVicePresident Connnunications and GovernmentAffairs Continental Airlines 

# t?! PORTAUiliORnY

### OF NY&

### NJ

- 2-
Theforegoing notwithstanding, the PortAuthorityfurther states that bythis letterthe Port Authoritydoes not consentto assignment ofany ofabove agreements from onepartyto another inthe absence ofdeliveryto thePort Authority ofthe relevant document or documents effecting such assignment, and the PortAuthority approval thereof, as mayberequiredbyanyofthe agreements listed above, including,butnot limitedto, therespective sectionsofthe agreements as set forth below. Agreement FacilityNameor Expiration Section 

## ! Description Date ANA-040 Maintenance Complex 4/30/2027 19 [Hangars 54, 55C, Engine BuildUp (EBU) Bldg. 101, Material Stores Bldg. 1 00) ANA-170 TerminalC 3/3112013 77 [Cl/C2] 3/31/2028 [C3] ANA-326 GSE 154 12/31/2024 18 ANA-370 ChelseaKitchen 2/28/2015 23 ANA-957 Hangar 56 ' 4/30/2027 21 ANB-028 Cargo Bldg. 344 

## i 12/31/2024 20 ANB-056 Terminal A 12/3112028 19 I ANB-990 Satellite Kitchen 7/3112012 19 ANC-069 Cargo 10/31/2012 21 We look forwardto reviewingtherelevant Continental/United documents as soon as they are available. Ifyou have any additional questions, do nothesitate to call. Sincerely,

Da "dKagan

**As~istant**DirectorBusiness, Pr · erties & Airport Development

### NT 2"168-u ' ' '


### ·Section 

### 16. Payment of Flight Fees Throughout the term of the letting under this Agreement, the Lessee shall pay to the Port Authority, the flight fee established by the Port Authority from time to time in accordance with Schedule C attached to and made a part of this Agreement, for each and the
The Lessee hereby agrees that not later than the 20th day of each and every month, it shall furnish to the Port Authority a statement, duly certified by an authorized officer of the Lessee, certifying the number of take-offs by type of aircraft operated by the Lessee during the preceding calendar month. The Lessee shall also send to the Port Authority together with the certified statement aforesaid its check to the order of the Port Authority in payment of all flight fees payable by the Lessee for its activities during the preceding calendar month, computed on the basis of its activity and the pre-established flight fee as attested by such statement. The flight fees payable by the Lessee hereunder shall be in addition to any and all other rents, charges, or fees imposed upon and payable by the Lessee under any other section of this Lease. The flight fees shall be payable by the Lessee whether or not the Lessee uses any or all of the Public Aircraft Facilities in addition to runways. "Maximum Weight for Take-off" when used with reference to any Aircraft shall mean the maximum weight at which such Aircraft is authorized to take-off from the Airport by the Federal Governmental Agency or Agencies having jurisdiction, under conditions of zero wind velocity and standard atmosphere, on the least restricted Runway which is available for take-off by such Aircraft under the rules and regulations of the Authority, provided, that Runways shall be deemed to be available for use under the rules and regulations of the Port Authority within the meaning of this definition in cases where they are not actually available for periods of less than 

## 48 hours because of snow, ice or other temporary emergency conditions. If such maximum weight is not specified by such Agency or Agencies, then said phrase shall mean the highest maximum authorized weight for take-off of other Aircraft of the same type and model at the time of take-off. Section 17. FUel Storage and Distribution System (a) The Port Authority proposes to build and to construct, in stages and as required, an Aviation Fuel Storage and Distribution System, hereinafter referred to as "the FUel System". The Port Authority hereby reserves the right in its discretion, and from time to time, to enlarge or reduce or modify the Fuel System, to make changes in and to the design thereof and to make other changes during the progress of construction which it may deem necessary or desirable.

- 29

-h 1' 2_cu8-U · 30. 

## c - p. 1



### SCHEDULE C I. Commencing upon the later of the following dates: (1) the commencement date of the letting or (2) the date as of which the Port Authority shall have certified that the extension of Runway 4R-22L and new Runway 4L-22R have been substantially completed (which later date is hereinafter called "the Starting Date") and continuing thereafter throughout the term of the letting under the Agreement to which this Schedule is attached (which Agreement is hereinafter sometimes called "the Lease") the Lessee shall pay to the Port Authority a flight fee for each and every take-off made by any aircraft operated by the Lessee. For the period from the Starting Date through the 31st day of December of the year in which the**sa~d** 

### Starting Date occurs (which period is hereinafter referred to as the Initial Period") the Lessee shall pay for each and every take-off, a flight fee at the rate of $0.6500 per thousand pounds of Maximum Weight for Take-Off, It is understood that the flight fee for the Initial Period is tentative only and represents the summation of the following factors: (1) A P.A.F. Charge Factor, which pertains to the Port Authority's snow removal operations and provision, operation, maintenance, servicing, repair and replacement of and to the Public Aircraft Facilities and Airport emergency services. For the Initial Period $ 0.3130 of the tentative flight fee of $0,6500 per thousand lbs. represents the tentative P.A.F. Charge Factor; and (2) An Airport Services Charge Factor which pertains to the Port Authority's snow removal operations and provision, operation, maintenance, repair and replacement with respect to Airport Services. For the Initial Period $0.3370 per thousand lbs. represents the tentative Airport Services Charge Factor. II. After the close of the Initial Period and after the close of each calendar year thereafter, the Port Authority will adjust the tentative flight fee for the Initial Period, or other calendar year, as the case may be, upwards or downwards to a finalized flight fee for such period or calendar year, as follows: A. P.A.F. Charge Factor (1) The Port Authority shall determine the total of the following major elements of costs actually incurred or accrued during the Initial Period, or other calendar year for which the adjustment is being made, in connection with the Public Aircraft Facilities:!J'X• 

### 2168'-

### u. · Sc. C

- p. 2
(a) fixed charges on Port Authority Investment in Public Aircraft Facilities; and (b) the Port Authority's cost of direct labor, materials, payments to contractors and suppliers, the Port Authority's costs charged to the Emergency Service functions at the Airport (whether performed by the Airport Police Section or other section or sections or other Port Authority organizational unit or units as may hereafter perform the same or similar functions), other costs for the operation, maintenance, repair, and replacement of Public Aircraft Facilities, and the pro-rata share of the cost of snow and ice removal. (2) The Port Authority will also determine the total**~laximum** 

### Weight for Take-off of all aircraft using the Airport during the Initial Period or other calendar year for which the adjustment is being made except such aircraft as are not required to pay a flight fee, such as government flights, etc. (3) The Port Authority will multiply the sum of $0.3130 representing the tentative P.A.F. Charge Factor in effect at the beginning of the Initial Period by a fraction the numerator of which shall be the total of the actual elements of cost described in subparagraphs (a) and (b) of the preceding paragraph A (l) and the denominator of which shall be $4,010,000.00; the resulting product shall then be multiplied by a fraction, the numerator of which shall be 17,734,000,000 lbs. and the denominator of which shall be the total Maximum**vlei~ht** 

### for Take-Off determined in the preceding paragraph A 

### (2); and the resultant product shall be the final P.A.F. Charge Factor of the finalized flight fee for the Initial Period or other calendar year for which the adjustment is being made. B. Airport Services Charge Factor (1) The Port Authority shall determlne the total of the major elements of cost actually incurred or accrued during the Initial Period, or other calendar year for which adjustment is being made, as such maJor elements are described in paragraph I, subparagraphs (a) through (d) in Schedule A attached to this Agreement. (2) The Port Authority shall a1so determine the percentage of total developed land area at the Airport occupied by the Public Aircraft Facilities during the Initial Period or other calendar year for which the adjustment is being made.

- 2

-

### NT 2168-U 

# sc. c p. 

### 3 (3) 

### The Port Authority will multiply the sum of 

### $0,3370 representing the tentative Airport Services Charge Factor of the tentative flight fee in effect at the beginning of the Initial Period by a fraction the numerator of which shall be the total of the actual major elements of costs determined under the

**precedin~** 

### paragraph B ( 1) 

### and the denominator of which shall be

**~4,625,000.00:** 

### the resulting product shall be multiplied by a fraction the numerator of which shall be 

### 17,734,000,000 lbs. and the denominator of which shall be the total Maximum Weight for Take-off determined in paragraph A (2) 

### above; and that product shall then be multiplied by a fraction the numerator of which shall be the percentage determined in 

### paragraph B (2) above and the denominator of which shall be 

### 66.1+7%. (4) The resultant product shall be the final Airport Services Charge Factor of the finalized flight fee for the Init1al Period, or other calendar year for which the adjustment is being made. 

# c. The final P.A.F. Charge Factor and the final Airport Services Charge Factor as determined above shall be added together and the sum thereof shall const1tute the finalized flight fee for the In1t1al Period or other calendar year for which the adjustment is being made. It shall also constitute the tentative flight fee for the calendar year in which such adjustment is calculated, and such flight fee will be expressed in cents per thousand pounds of Maximum Weight for Take-Off. The finalized flight fee shalJ. be multiplied by the total Maximum Weight for Take-off (in thousand of pounds) of all aircraft operated by the Lessee which took off from the Airport during the Initial Period or other calendar year for which the adjustment is being made and during the calendar months which have elapsed since the close of the Initial Period or other calenda,r year. The resultant product shall constitute the total flight fee charges payable by the Lessee to the Port Authority for the Lessee's use of the Public Aircraft Facilities during the Initial Period, or other calendar year, and for the months which have elapsed since the close of the Initial Period or other calendar year. The Lessee shall continue to make payments based on the new tentative flight fee until the same is further adcjusted. Any deficiency due to the Port Authority from the Lessee for the InHial Period or for any calendar year thereafter resulting from adjustment of the flight fee shall be paid to the Port Authority by the Lessee within thirty (30) days after demand therefor and any excess



### - 3 -·

### NT 2168-U Sc. C p. 4 payments made by the Lessee determined on the basis of an adjusted flight fee shaH be credited against future flight fee charges, such credit to be made within thirty (30) days

**fol~wing** 

### the adjustment of the flight fee. The

**~alculation** 

### of the adjustment to the flight fee wJll be made for the Initial Period, and ror such calendar year ohereafter, by no later than April 30th of the following calendar year. D. Notwithstanding the provisions of the Lease and notwithstanding anything herein contained, it is understood and agreed that the Lessee shall in no event be obligated at any time during the term of the letting under the Lease to pay a flight fee, whether tentativ.e o1t finalized, which is at a rate in excess of the flight fee rate imposed at that time upon aircraft of the following airlines: Allegheny Airlines, Inc., American Airlines, Inc., Braniff Airways, Inc., Delta Air Lines., Eastern Air Lines, Inc., Mohawk Airlines, Inc., National Airlines, Inc., Northwest Airlines, Inc., and Trans World Airlines, Inc. E. All percentage shares calculated under this Schedule 

## c shall be expressed in decimals to the nearest ten-thousandth. F. All flight fees payable under this Agreement shall be expressed in cents per thousand lbs. of Maximum Weight for Take-Off to the nearest ten-thousandth of a cent.



### - 4 - 

## c""'

**~ ~**  'L-'

**·~-={<::..-._...- .~.,'..t.**  c...Lvu-v


### paving work. If the Port Authority finds that the same has been completed to its satisfaction and in full compliance with the aforesaid approved Port Authority Construction Application, it shall issue and deliver to the Lessee a certificate certifYing to the completion of all such gate positions. The date specified in such certificate or the date of such certificate, whichever is later, shall constitute the Completion Date of Area D. (d) When the necessary fill has been placed upon Area E and the grading and paving thereof have been completed to the satisfaction of the Port Authority, the Port Authority will deliver to the Lessee a Certificate of Completion. The date specified in such Certificate or the date of the Certificate whichever is later shall constitute the Completion Date of Area E. (e) The Lessee shall not use any Area of its premises or any of the non-exclusive Areas for any of the purposes set forth in Section 11 hereof until the Port Authority has certified to the Lessee that the Lessee (and where required that the Lessee and its Airline co-lessees) has substantially completed all of the construction and installation work required to be performed by the Lessee (and if required, by the

**k~~see** 

### and its Airline co-lessees) in Passenger Terminal Building

**A:,"'**



### 11 **1fassageway~** 

### B and B-1, Flight Stations

**,~** 

### A-1, and A-2 and Aircraft Gate Positions designated "Area D". Section 

### 7. Term (a) The term of the letting of Areas A, A-1, A-2, B, C, C-1, C-2, C-3 and D shall commence on the Completion Date of all said Areas, and the Lessee's obligation to pay the fees prescribed in Section 

## 9 hereof for the non-exclusive areas described in Section 3 hereof shall commence on the Completion Date of all said non-exclusive areas, as the term Completion Date is defined and determined in Sub-section (a) of Section 

## 6 of this Agreement. and 31, (b) 

### the right to 

## 1996. Unless sooner terminated the letting of the premises use the non-exclusive areas shall expire on December (c) The Port Authority hereby reserves the right at any time upon ninety (90) days written notice to the Lessee and to all other Airline Lessees entitled to the non-exclusive use of Area E in common with the Lessee to terminate the common use of said area if, in the discretion of the Port Authority, such area is required for the further expansion of the Central Terminal Area Complex or for the expansion of Passenger Terminal Buildi:1g C or for the expansion of the Public Aircraft Facilities (as the same are described in Section 14 hereof), provided another area reasonably comparable to Area E is substituted therefor and made available for common use by the Lessee and all other Airline Lessees in the Central Terminal Area Complex.

- 14

-5. Subsection (b) of Section 7 of the Lease is amended by deleting therefrom the date "Decerrber 31, 1996" and substituting therefor the date "December 31, 1998". 6. Section 8 of the Lease entitled "Rentals" is hereby amended to read as follows: "Section 8. Rentals (a) Commencing on March 6, 1972 and through June 30, 1973 the Lessee shall to the Port Author
afores · annual rental shall be payable monthly in advance the first installment, payable on

**~larch** 6, 1972 being for a part of a month only, shall be in monthly rental payable on April 1, 1972 and on the first of each and every month thereafter through and including the rental able on June l, 1973 shall be (b) Commencing as of July l, 1973 the Lessee shall pay rentals to the Port Authority for the premises as follmvs: 

### C,

annual rate is subject to revisions from to time as provided in Section 10 and Schedule A hereof. The Lessee shall pay the rental monthly in advance, the first monthly installment le

time as the annual rental rate has been revised in accordanc(' \vith Section' 10 l

and Schedule A hereof, Hhich adjusted annual rate shall remain in effect until the next adjustment and the



### - 4

-seats that can be accommodated on the particular aircraft equipment scheduled to be used by the Lessee. The total revenue seats of the Lessee shall then be divided by fourteen (14), the resulting quotient being herein called 'the revenue seats daily average' of the Lessee. (g) It is recognized and agreed that where all or a portion of the Lease is assigned pursuant to the terms of the Lease, the assignee's lease shall contain the provisions of this Section 70H with the insertion of appropriate numbers and dates in paragraphs (a), (b) and (c) hereof.• 13. Effective as of December 31, 1998, the term of the letting under the Lease is hereby extended for the period ending on December 31, 2018, unless sooner terminated, upon all the terms, covenants, provisions and conditions of the Lease, as hereby amended. 14. For the period commencing on January 1, 1999 to and including December 31, 2003, the Lessee shall pay to the Port Authority rental for the premises during the extension set forth in Paragraph 12 hereof as follows: (a) For Exclusive Areas C-2, C-3, G and V, Factor, as herei

us provided in Paragraph 16 hereof and Schedule A of the Lease, as herein amended. The Lessee shall pay the rental for the Exclusive Areas, as the same shall then have been determined based upon the aforesaid adjustments, monthly in advance on January 1, 1999 and on the first day of each and every succeeding month in equal installments until such time as the aforesaid annual rate has been further adjusted in accordance with Paragraph 16 hereof and Schedule A of the Lease, as herein amended, which adjusted annual rate shall remain in effect until the next adjustment and the monthly installments payable after each such adjustment shall be equal to one-twelfth (1/12th) of said annual rate as so adjusted.
27quarcerly, the Port Authority may notify the Lessee whether and to what extent the payments due to the Port Authority resulting from the tentative Monorail Fee established pursuant to Schedule M will be likely to exceed or be less than the payments which would result from the estimated finalized Monorail Fee as described in Paragraph II of Schedule M for such year for the period during such year as designated by the Port Authority's notice. If such notice is given the Lessee shall pay a new tentative Monorail Fee established by the Port Authority and set forth in said notice until the same is further adjusted in accordance with this subparagraph or Schedule M. 2. There shall be added to the Lease, as 'Schedule M,' the following: "SCHEDULE M
I. Commencing upon the date (hereinafter called the 'Monorail Fee Commencement Date') which the Port Authority shall have certified to be the date as of which the construction of the Monorail System at Newark International Airport (hereinafter called the 'Airport') has been substantially completed and is operational and continuing thereafter for the balance of the term of the Lease, the Lessee shall pay to the Port Authority a Monorail Fee for each and every take-off of each and every Passenger Aircraft, as defined in Paragraph 1 of Supplement No. 24 of the Lease, operated by the Lessee. For the period from the Monorail Fee Commencement Date through the 31st day of December of the year in which the said Monorail Fee Commencement Date occurs (which period is hereinafter referred to as 'the Initial Schedule M Period' I, the tessee shall pay for

**each~** such take-off, a tentative Monorail Fee at the rate of

- thousand pounds of Maximum weight for Take-off, as defined in Paragraph 1 of Supplement No. 24 of the Lease. It is understood that the Monorail Fee for the Initial Schedule M Period set forth above is tentative only and is subject to final determination as hereinafter provided. II. Initial Construction Factor: (a) Ill On or after the Monorail Fee Commencement Date the Port Authority shall determine the portion of the total construction costs (the 'Monorail Construction Costs') paid or incurred by the Port Authority in connection with
5Port Authority shall also advise the Lessee of the New Phase lA CH&RP Charge, which shall be the amount due and payable by the Lessee to the Port Authority for each calendar month during calendar year 1995 or such other calendar year and for each and every month thereafter during the remainder of the Phase lA Charge Period. The Lessee shall pay the New Phase lA CH&RP Charge at the time it pays the tentative Charges for the calendar month following the month during which the New Phase lA CH&RP Charge is calculated and shall continue to make payments based on the said New Phase lA CH&RP Charge at the time it pays each Charge hereunder during the remainder of the Phase lA Charge Period. (c) Any deficiency in the amounts due to the Port Authority from the Lessee for any calendar year resulting from the adjustment of the Initial or New Phase lA CH&RP Charge shall be paid to the Port Authority by the Lessee within thirty (30) days after demand therefor and any excess payments made by the Lessee determined on the basis of an adjusted Initial or New Phase lA CH&RP Charge shall be credited against future Charges hereunder, such credit to be made within thirty (30) days following the adjustment of the Initial or New Phase lA CH&RP Charge, as the case may be." 9. Schedule C attached to the Lease, as heretofore amended, shall be deemed further amended as follows: (a) The seventh (7th) line of Paragraph I thereof shall be amended to read as follows: "take-off made by any aircraft operated by the Lessee.

In connection with the Phase lA Roadway Work, as defined in Supplement No. 24 to the Lease, there shall be included in the aforesaid flight fee an Initial Phase lA Charge Factor subject to adjustment as hereinafter provided. For
.... " (b) There shall be added immediately after subparagraph B of Paragraph II thereof, as subparagraph BB, the following: "BE. Initial Phase lA Charge Factor: In connection with the Phase lA Roadway work and in addition the P. A. F. Charge Factor and the Airport Services
20exceed a legal maximum applicable to such late charges then, in such event, each such late charge payable under this Agreement shall be payable instead at such legal maximum." 5. There shall be added at the end of subparagraph (b) (6) of Section 30 of the Lease the following sentence: 'The foregoing obligation shall not apply to the roof and

exterior structure of Area M." 6. (a) The parties hereby acknowledge that the Port Authority is performing a certain landside access construction project at the Airport consisting generally of the following portions: a) the construction of certain roadway improvements at the Airport's principal roadway entrance; b) the construction of an inbound ramp connecting the I-78 Connector to Brewster Road and a corresponding ramp to facilitate outbound movements of traffic; c) the construction of roads to connect Monorail Stations "D2" and "E" to adjacent Airport roads, and dropoff/pick-up facilities at said Stations; d) an expansion of the Central Terminal Area Complex recirculation road; and e) other roadway improvements related thereto; all of the foregoing portions being hereinafter collectively called the "Phase lA Roadway Work. " (b) (1) For purposes of this Supplemental Agreement, the term "Phase lA Costs" shall mean the total costs in connection with all portions of the Phase lA Roadway Work, as determined under subparagraph (a) (1) of Section II of Schedule M attached to the Lease by Paragraph 

### 2 hereof as such costs are incurred in the performance of each portion of the Phase lA Roadway Work. (2) "Phase lA Charge Commencement Date" shall mean the date on which the Port Authority shall have certified that the construction of any portion of the Phase lA Roadways has been substantially completed, provided, however, if any such date shall occur on other than the first day of a calendar month, the Phase lA Charge Commencement Date shall mean the first (1st) day of the first (1st) full calendar month immediately following the month during which the said date occurs. ( 3) (i) "The Phase lA Factor" shall mean the sum of (1) the respective averages of the annual capital investment recovery rates of the "25-Bond Revenue Index" appearing in
12

### 7./27/f!J.

THIS AGREEMENT SHALL NOT BE BINDING UPON THE PORT AUTHORITY UNTIL DULY EXECUTED BY AN EXECUTIVE OFFICER THEREOF, AND DELIVERED

**,-------------T~O~T~HE** 

### LESSEE BY AN AUTHORIZED REPRESENTATIVE ' I'V!;C\T:(\:: C\:-::PT. 

# I OF THE PORT AUTHORITY 

# \;I.:_\ ; r· ('\: .\

# D \fj ASSIGNMENT OF LEASE 

# l ! 

## L L 

## 'J 

## U

__

## l _1 .: WITH ASSUMPTION AND CONSENT 

# .'

(Lease No. ANA-170) THIS AGREEMENT, made as of August 15, 1987 by THE PORT AUTHORITY OF NEW YORK AND NEW JERSEY (hereinafter called "the Port Authority"), ·a body corporate and politic created by Compact between the States of New York and New Jersey, with the consent of the Congress of the United States of America, having an office for the transaction of business at One world Trade Center, in the Borough of Manhattan, in the City, County and State of New York, and PEOPLE EXPRESS AIRLINES, INC. (hereinafter called "the Assignor"), a corporation organized and existing under the laws of the State of Delaware with an office for the transaction of business at the North Passenger Terminal at Newark International Airport, Newark, New Jersey and CONTINENTAL AIRLINES, INC. (hereinafter called "the Assignee"), a corporation organized and existing under the laws of the State of Delaware with an office for the transaction of business at Suite 1401, P.O. Box 4607, Houston, Texas 77210-4607 the representative of which is Mr. Sam E. Ashmore, WITNESSETH, THAT: WHEREAS, the Assignor desires to assign to the Assignee that certain Agreement of Lease dated as of January 11, 1985, made by and between the Port Authority and the Assignor, and hereinafter, as the same has been heretofore amended and supplemented, called "the Lease" covering certain premises, rights and privileges at and in respect to Newark International Airport; and WHEREAS, the Assignee has advised the Port Authority and the Assignor that it is desirous of acquiring the Lease and becoming the tenant of the Port Authority thereunder; and WHEREAS, the Assignee and the Port Authority have agreed, contemporaneously with the execution and delivery of thi Agreement by the Port Authority, to enter into Supplemental Agreement No. 6 to the Lease; and

### 7/27/87 

### • WHEREAS, the Port Authority is willing to consent to such assignment on certain terms, provisions, covenants and conditions: NOW, THEREFORE, in consideration of the covenants and mutual agreements herein contained, the Port Authority, the Assignor and the Assignee hereby agree as follows: 1. The Assignor does hereby assign, transfer and set over to the Assignee and its successors, to its and their own proper use, benefit and behoof forever, the Lease, to have and to hold the same unto the Assignee, its successors from the fifteenth day of August, 1987, for and during all the rest, residue, and remainder of the term of the letting under the Lease, subject nevertheless to all the terms, provisions, covenants and conditions therein contained. 2. The Port Authority hereby consents to the foregoing assignment. Notwithstanding anything herein to the contrary, the granting of such consent by the Port Authority shall not be, or be deemed to operate as, a waiver of the requirement for consent (or consents) to each and every subsequent assignment by the Assignee or by any subsequent assignee, nor shall the Assignor be relieved of liability under the terms, provisions, covenants and conditions of the Lease by reason of this consent of the Port Authority or of one or more other consents to one or more other assignments thereof. 3. The Assignor agrees that this assignment of the Lease and this consent of the Port Authority thereto shall not in any way whatsoever affect or impair the liability of the Assignor to perform all the terms, provisions, covenants and conditions, including without limitation thereto the obligation to pay rent, of the Lease on the part of the Lessee or tenant thereunder to be performed, and that the Assignor shall continue fully liable for the performance of all the terms, provisions, covenants and conditions, including without limitation thereto the obligation to pay rent, on the part of the Lessee or tenant thereunder to be performed. The liability of the Assignor as set forth in this paragraph shall remain and continue in full force and effect as to any and every renewal, modification, or extension of the Lease whether in accordance with the terms of the Lease or by a separate or additional document, and notwithstanding any such renewal, modification, or extension, whether or not the Assignor has specifically consented to such renewal, modification or extension. The liability of the Assignor hereunder shall in no way be affected by the failure of the Port Authority to obtain the Assignor's consent to any such renewal, modification or extension notwithstanding that the Port Authority had previously obtained such consent with respect to a prior renewal, modification, or extension.

Page 2

### 4. The Assignee does hereby assume the performance of and does hereby agree to perform all the terms, provisions, covenants and conditions, including without limitation thereto the obligation to pay rent, contained in the Lease, to be performed on the part of the lessee or tenant thereunder, as though the Assignee were the original signatory to the Lease. The execution of this instrument by the Port Authority does not constitute a representation by it that the' Assignor has performed or fulfilled every obligation required by the Lease; as to such matters the Assignee agrees to rely solely upon the representation of the Assignor. 5. The liability of the Assignor hereunder shall in no way be affected by: (a) The release or discharge of the Assignee in any creditors' receivership, bankruptcy or other similar proceeding; or (b) 

### The impairment, limitation or modification of the liability of the Assignee or its estate in bankruptcy, or of any remedy for the enforcement of the Assignee's said liability under the Lease, resulting from the operation of any present or future provision of the Bankruptcy Code or any other statute or from the decision of any court having jurisdiction over the Assignee or its estate; or (c) The rejection or disaffirmance of the Lease in any creditors' receivership, bankruptcy, or other similar proceeding; or (d) Any disability or any defense of the Assignee. 6. Neither the Commissioners of the Port Authority nor any of them, nor any officers, agent or employee thereof, shall be charged personally by the Assignor or by the Assignee with any liability or held liable to either of them under any term or provision of this Agreement, or because of its execution or

Page 3

### attempted execution, or because of any breach or attempted or alleged breach thereof. IN WirNESS WHEREOF, the Port Authority, the Assignor and the Assignee have executed these presents as of the date first hereinabove set forth.

ATTEST:

**~** 

# (\;S0-St>l Secretary ASSIGNOR: PEOPLE EXPRESS AIRLINES, INC. By 

# %JwLtL

**~** 

# .. ____ (Title) 

# v,ee__

**Pre~** ;n,t
_ (Corporate Seal) ASSIGNEE: CONTINENTAL AIRLINES, INC. (Title) 

## vfc.& President (Corporate Seal)

(Seal)

APPROVED:



### Page 4

### FormE- Acknowledgment (N.J.) I 62472 

### STATE OF NEW YOM ) ) 1111 • 

### CO!JN'I'Y OF NEW 

### YORK ) On thill

# /F day of



## L-e.t/__;~ 

## , 1981 , 

### before me,



## t~ subscriber, a nota;¥ public of New York" personally



### appeared;£'..£.~ 

## d

**1cc-re~** the

**/.JLA.-L-.c-c.~ij-- d::~r<-dru**  

### of The Port Aut ority of New York and New Jersey, wno I 

### am satisfied is the person who has signed the within instrument, and, I 

### having first made known to him the contents thereof, he did ackncvledge that he signed, sealed with the corporate seal, and delivered the same as such officer aforesaid, and that the within instrument is the voluntary act and deed of The Port Authority of New York and New Jersey, made by virtue of the authority of its Board of Commissioners.

STATE OF 

## Te.;f:.CY":> l JAQUEUNE WHITE ) IIIII. NOTARY PUBliC, Stale of New York

**d_~** I? D 

### '"3 ) No. 4737769 

### COUNTY OF

**t~.--.-.**

## \ Qualifie<l in Suffolk County ,.4

**~** rnrnissi E ptres

**M~·** "

**~n** l'jo1 (



### . On



### thi~ **-~A~ay** of



### ~~~ , 1987 , 

### before me, the



### s~scribeF, a 

## Nofui)&R'..J( 

## i5:' Pu DlfC Cl-
- 6 , personally appeared

**Klc~o._** 

## \;{ -'5\\u'{ 

# -c K , 

### (the 

## '-JlC-e._ President of People Express Airlines, Inc. ) who I 

### am satisfied is the person who has (executed) (signed) the within instrument, and, I 

### having first made known to (him) (her) the contents thereof, (s)he did acknowledge that (s)he aigned, sealed (with the corporate seal) and delivered the same as (his) (her) (voluntary act and deed, for the uses and purposes therein expressed) (such officer aforesaid and that the within instrument is the voluntary act and deed of People Express Airlines, Inc. made by virtue of the authority of its board of directors)

**~ind~J~y-and-a._** 

### general-par 

### h- ·

STATE OF ) 

### COUNTY OF



### t-\GR~\'5 ) 1111 • ) 

### On thil'



# ·~a:y of



# ~ , 19 87 , 

### before me, the



### s~scriber, 

## c;-. 1'-lm<::,p..'-{ 

# Pubt1 

## c , penonally appeared

**~** 

### C,

**Pe>i~\'YIOee** 

### , (the 

### "-1\:C..E', President of Continental Airlines, Inc. ) who I 

### am satisfied is the person who has (executed) (signed) the within instrument, and, I 

### having first made known to (him) 

### (her) the contents thereof, {s)he did 

### acknowledge that (s)he signed, sealed (with the corporate seal) and delivered the same as {his) (her) (voluntary act and 

### deed, for the uses and purposes therein

**~xpreased)** 

### (such officer aforesaid and that the within instrument 1111 

### the voluntary

**~act** 

### and deed of Continental Airlt'nes, Inc. made by virtue of the authority of ts board of directors)

**-~.i¥-id>JaUy** 

### and -&a. 

### general .put 

# -+• 

# ld4

**~** 

# \

• HELEN B. W1.SON

. I 

### 11 I I j, 

### 11 A· 'A
.

**~ ~**  ' COIIMISS!ON EXPIRES 

### .J-l(f / UJ }-JVdJ_J\ 

# i.,....___.,. NOI'EMBEJ'!:!<. 11100 t 

# notail 8e!!.l 

### and stamp)



## ~-~~-~\.:~~-'"'··'--/"". ..,_,..,_.....

## ,A!)"~

### (ii) Property Damage Liability For all damage arising out of injury to or destruction of property in any one occurrence ..••.•.•..•.$ 

### 25,000,000
,. Aggregate"Products Completed Operations•••..• ·''·• •.$ 

### 25,000,000

. I 

### Aggregate Premises

· Operations•....••.•.•.$ 

### 25,000,000 Aggregate Protective••.•.$ 

### 25,000,000 Aggregate Contractual ..••$ 

### 25,000,000". (d) The word "Worker's" appearing in the last sentence of subparagraph (11) of said paragraph (c) shall be deemed amended to read "Workers'". (e) 

### the second subparagraph shall be deemed amended The seven'th through fourteenth lines of (14) of paragraph (c) of said Section 2 to read as follows: "thereof and, also, a valid provision obligating the insurance company to furnish the Port Authority and the City of Newark simultaneously with the said insurance company's notice to the Lessee, but in no event less than ten (10) days' advance notice to the Port Authority, of the cancellation, termination, change or modification of the insurance evidenced by said policy or certificate. Renewal policies or certificates shall be delivered to the Port Authority simultaneously with the delivery thereof by the Lessee but in no event less than ten (10) days before the expiration of the insurance which such policies are to renew." (f) The fifth line of subparagraph (1) of paragraph (h) thereof shall be deemed amended to read as follows: ''an authorized officer of the Lessee and by 

### the Lessee's architect or engineer certifying that the". 4. Paragraph (b) of Section 4 of the Lease is hereby amended to read as follows:

-4-

### follows: ·(b) Unless sooner**termina,~~,** 

### the term of the letting heceunder shall expire on the day immediately preceding the twenty-fifth (25th) year anniversary date of the Completion Date as defined in Section 2 hereof, or on December 31, 2012, whichever date first occurs, or on February 28, 2013 if the Executive Director has extended the date for completion as set forth in Section 2(c)(2) hereof to February 29, 1988, or on March 31, 2013 if the Executive Director has extended the date for completion as set forth in Section 2(c)(2) hereof to March 31, 1988." 5. Section 5 of the Lease is hereby amended as (a) Subparagraph (1) of paragraph (a) thereof shall be deemed amended by de1eting the designation "(1)" at the beginning thereor and by amending the same to read as follows: "'Rental Commencement Date' shall mean (i) the Completion Date, as defined in Section 2 hereof, or January 1, 1988, whichever date occurs first; or, (ii) if the Executive Director has extended the date for completion as set forth in Section 2 (c)(2) hereof to February 29, 1988, 'Rental Commencement Date' shall mean the Completion Date, as defined in said Section 2, or March 1, 1988, whichever date occurs first; or (iii) if the Executive Director has extended the date for completion as set forth in Section 2(c)(2) hereof to March 31, 1988, 'Rental Commencement Date' shall mean the Completion Date, as defined in said Section 2, or April 1, 1988, whichever date first occurs; or (iv) if the Executive Director has extended the date for completion as set forth in Section 2(c)(2) to March 31, 1988 and the Lessee exercises its election in accordance with and as provided in the following sentence, 'Rental Commencement Date' shall mean the Completion Date, as defined in said Section 2, or March l, 1988, whichever date first occurs. It is expressly agreed that in the event the Executive Director has extended the date for completion to March 31, 1988 the Lessee may by written notice to the Port Authority, given not later than January 31, 1988, elect to commence payment of
-5-

### the Base Annual Rental hereunder on the Completion Date, as defined in said Section 2, or March l, 1988, whichever date first occurs.'' {b) shall be force or Subparagraph {2) of paragraph {a) hereof deemed deleted and shall be of no further effect. {c) Paragraph (b) thereof shall be deemed amended to read as follows: {b) Base Annual Rental The Lessee agrees to pay to the Port Authority the following Base Annual Rental for the premises: {1) For the portion of the term of the Lease commencing on the Rental Commencement Date to the last day of the month of the twelfth (12th) month consecutively following the Rental Commencement Date, including the month in which the Rental Commencement Date occurs (and in the event the Rental Commencement Date occurs on a day other than the first day of a calendar month the said portion of the term shall end on the day preceding the actual day on which the twelfth- month anniversary of the Rental Commencement Date Bn.nu.ct

### 1 Ren

ctor in 

# llliilll' Dollars and No Cents subject to the adjustments as paragraph (c hereof, and the able the amoun



### ethe Airport Services portion of the Base Annual Rental and such variable factor of the Base Annual Rental is herein-
-6-

### ANA-l70S6B. (7/24/8;7J • ' I'', '

. r' • y" I ',•,,' 

### ' 

# . •and further limited with respect to Construction Advances in excess of $175,000,000 to construction of facilities that are not by their nature utilizable by only the Lessee or the Lessee's Affiliated Companies." (iii) The first full paragraph appearing at the top of page 48 

### of the Lease shall be deemed deleted from the Lease and shall be of no further force or effect. (4) There shall be deemed added at the end of paragraph (o) of Section 6 the following new paragraph (p) reading as follows: "(p) The Lessee hereby represents and warrants to the Port Authority that all construction contracts covering the construction work or portions thereof, including, but not limited to, the contract entered into between People Express and VRH/CROW, a Joint Venture of VRH Construction Company and William L. Crow Construction Company, dated April 10, 1985, as heretofore amended, supplemented and modified, as well as the McCormick-Morgan contract described in subparagraphs (4) and (12) of paragraph (n) of this Section, and the Wollard contract described in subparagraphs (1) and (6) of subparagraph (n) of this Section and the contract between People Express and BAE Automated Systems, Inc. and the contract between People Express and the Grad Partnership with respect to the construction work have been duly assigned by People Express to the Lessee including all modification agreements and amendments thereto as heretofore consented to by the Port Authority and, further, that no consent of any of the contractors is required for said assignment, or if required that the same has been obtained with respect to each of the said contracts." 7. Section 7 of the Lease shall be deemed deleted therefrom and shall be of no further force or effect. 8. (a) The second and third sentences of paragraph (b) of Section 18 of the Lease and the items designated therein as "Minimum Limits" shall be deemed amended to read as follows: ''The said policy or policies of insurance shall also provide or contain an endorsement providing that the protections -15- 

# \(' '' f . ' ' 

# .. 

### afforded the Lessee thereunder with respect to any claim or action against the Lessee by a third person shall pertain and apply with like effect with respect to any claim or action against the Lessee by the Port Authority, and that said pro- tections shall also pertain and apply with respect to any claim or action against the Port Authority by the Lessee, but such endorsement shall not limit, vary, .change, or affect the protections afforded the Port Authority thereunder as an additional insured. The said policy or policies of insurance shall also provide or contain a contractual liability endorsement covering obligations assumed by the Lessee under Paragraph (a) hereof. Minimum Limits Comprehensive General Liability (including Aircraft Liability) Bodily Injury Liability:

For injury to or wrongful death of one or more than one person in any one occurrence: Property Damage Liability (including but not limited to aircraft 

### in the care, custody and control of the Lessee) For all damages arising out of injury to or destruction of property in any one occurrence: Comprehensive Automobile Liability Bodily Injury Liability:

For injury to or wrongful death of one or more than one person in any $100,000,000

$100,000,000



### one occurrence: $25,000,000 Property Damage Liability:

For all damages arising out of injury to or destruction of property in any one occurrence: $ 25,000,000." (b) The words ''Each such copy or'' appearing in the sixteenth and twentieth lines of said paragraph (c) of Section 18 shall in each case be deemed amended to read "Each such copy and''. (c) The words "or out of the use or" appearing in the eighth line of paragraph (a) (1) of said Section 18 of the Lease shall be deemed amended to read ''arising out of any default of the Lessee in performing or observing any term or provision of this Agreement or out of the use or''. -16-. ',.,' ' ' 

### shall be credited against future charges, such

**cr~dit** 

### to be made within thirty (30) days following such adjustment. Nothing herein in this paragraph (g), however, shall obligate or be deemed to obligate the Port Authority to supply high temperature hot water and chilled water or to continue any such supply once the same is started, at any time prior to the Rental Commencement Date, or to make any'determination or adjustment under Schedule B at any time other than as stated herein." 13. Section 53 of the Lease is hereby amended by adding at the end thereof a new paragraph "(d)" reading as follows: "(d) Without limiting any of the foregoing provisions of this Section or any of the provisions of Schedule 

## c, the Port Authority, commencing after the Schedule C Date, may from time to time during each succeeding calendar year, but no more frequently than quarterly, notify the Lessee whether and to what extent the payments due to the Port Authority resulting from the tentative flight fee established pursuant to Schedule C will be likely to exceed or be less than the payments which would result from the estimated finalized fee as described in Paragraph II of Schedule C for such year for the period during such year as designated by the Port Authority's notice. If such notice is given the Lessee shall pay a new tentative flight fee established by the Port Authority and set forth in said notice until the same is further adjusted pursuant to this paragraph or Schedule C." 14. Section 56 of the Lease is hereby amended as follows: (a) The words "or 82" shall be deemed deleted from the last line of subparagraph (ii) of paragraph (c) thereof. (b) Subparagraph (iii) of paragraph (c) thereof shall be deemed deleted and shall be of no further force or effect. (c) A new paragraph ''(d)" shall be added at the end thereof reading as follows: "(d) Without limiting any of the foregoing provisions of this Section or any of the provisions of Schedule D, the Port Authority, commencing after the Schedule 

## c Date, may from time to time during each succeeding calendar year, but no more frequently than quarterly, notify the Lessee whether and to what extent the payments due to the Port Authority resulting from the
-21-

### defined) for or in connection with aircraft operated by the Lessee, for the purposes for which such facilities are provided, and all common and public roads, roadways and other means of access as they may from time to time be provided by the Port Authority to or from the Public Aircraft Facilities and all other existing common and public areas, space, facilities and conveniences and such additional common and public areas, space, facilities and conveniences as may from time to time be provided by the Port Authority at the Airport, at the time and times and for the purpose and purposes for which they are provided and subject to the terms and conditions (including the payment of fees or other charges which may now or in the future be imposed for said use) upon which they are made available therewith. Section 51. Expansion, Maintenance and Operation of Public Aircraft Facilities Pursuant to the Federal Airport Act and Regulations thereunder, the Port Authority has filed with the

**A~~inistrator** 

### of the Federal Aviation Administration a revised Master Plan (layout) of the Airport as shown on Port Authority Drawing No. NIA-7900 (Exhibit E, attached hereto and hereby made a part hereof) dated May 10, 1973 which shows the layout of the Airport. Upon approval of the revised Master Plan (layout) by the Administrator of the Federal Aviation Administration, the Port Authority will agree with such Administrator to conform to such revised Master Plan (layout) in making any further improvements or changes at the Airport which, if made contrary to such revised Master Plan (layout) may adversely affect the aeronautical safety, utility or efficiency of the Airport. Nothing contained herein shall be construed as a representation or agreement by the Port Authority that the

**~laster** 

### Pl.an (layout) as revised will not be further changed or modified from time to time or abandoned. Exhibit E expresses the PQrt Authority's tentative pians only as of the date hereof and it is understood that such plans are subject to change at the discretion of the ?ort AUthority. In addition to the facilities show-n on the Mas-cer Plan (layout) ,t:1e ?crt Authority may from time to time provide other and extended Public Aircraft Facilities, the costs of which additional aad/or exteEded facilities and other costs shall constitute additional costs of providing the ?ublic Aircraft Facilities (a factor in establishing the flight fees as provided in the schedule attached hereto, hereby made a part hereof and marked "Schedule C") if such additional costs result

**f~cm** any one or more of the following factors:

- 98

-TER'!. C 484
(a) Technical advances in aircraft design; (b) Orders or requirements of governmental authorities which are pertinent to the Lessee's ai:!:cr-aft operations or are related to the issuance to the Port Authority of federal grants or loans in aid of the Airport; (c) Orders issued by a court of competent jurisdiction requiring the acquisition by the Port Authority of additional lands or the making of compensation to owners of adjoining lands for the taking thereof or Nhere a constructive taking has been found; (d) All costs, expenses,

**damage:~** and judg7Jlents incurred by or imposed upcn the

**~crt** Authority because of or as constituting noise costs (as the words "noise costs" are defined in paragraph (r) of Section 72 hereof). The Port Authority agrees to give to the Lessee prompc notice of any

**cla~ ~de**  against it or the institution of any suit seeking or demanding noise costs damage. The Lessee shall have a right to join in the defense of any such

**cla~~** or suit. (e) Casualty damage requiring new capital expenditures to the extent that such

**d~~age** is not covered in insurance; and (£) Expenditures made by the Port Authority in

**addit~cn** to those

**res~lting** frcrn the foregoing

**fact~rs** where the additional expenditures are such that would have bsen made by a reasonably prudent Airport Operator. Cost Factors (including all elements of cosk incurred or accrued) as set forth in Schedule C, as ne-.::essary 

### L-. providing the Public Aircraft Facilities, are

**he~eby** agreed to and accepted as expenses incurred by a reasonably prudent Airport Operator. For the purposes of this Agreement, the te;:::n "?c:blic

**~ircraft** Facilities" shall include such of the follat.ving faciliti8s as now exist and shall, from time to tUnet be

**const~ucted,** provided

**~~d** maintained by the Port Authority ac the Airport for public and common use including without

**l~itation** thereto, use by Airline Lessees (including the Lessee) of the Central

**~e~inal** Area Complex and by

**Ai~c~af~ Op~rators,**  **ot~er** than said Airline Lessees for

**~he** following pur?oses ::egardless of whecher or not they are actually used or usable in whole or in part by the Lessee (except that such facilities shall not be dee.."tled to includ2 any area or areas c.s to w·hich the Lessee is grantsd rights

**?U~suant** tQ Section l or J of this

**Agr~sment):**



### - 99

-.!.C.!'..:.'! • "-" ..L.:...O"t

(a) Public Ramp and Apron Space

- by which is meant space for the purpose of loading and unloading passengers, baggage, rr.ail and supplies to or from aircraft, for the purpose of servicing aircraft with fuel and lubricants, for the purpose of performing the operations commonly known as "ramp service" and for the purpose of performing inspection, minor maintenance and other services upon or in connection with aircraft incidental to performing "ramp service" and for the purpose of parking of mobile equipment actively used in connection with such operations; (b) Runways

- by**~;hich** is meant the runways (including aerial approaches and buffer zones and additionally anything required for the effective and safe operation of aircraft as required by the Federal Aviation Administration) at the Airport for the purposes of landing and taking off of aircraft; (c) Aircraft Parking and Storage Space

- by which is meant those public areas of the Airport which are designated by the Port Authority from time to time for use by an Aircraft Operator for the parking or storage of an aircraft. (d) Taxiways by which is meant taxiways at the .".irport for the purpose of the grou.>1d movement cf aircraft to, from and between the runways, the Public Ramp and Apron Space, the Aircraft Parking and Storage Space, aircraft maneuvering areas, and other portions of the Airport, not including, however, any taxiways or portions thereof that are within the**~essee's** premises. (e) Facilities incidental to the runways, the Public Ramp and Ap:::-on Space, the Aircraft**Park~ng** and Storage Space and Taxiways-by which is meant facilities and equipment for the monitoring of aircraft noise decibels and facilities for the purpose of controlling or assi3ting arrivals, departures and operations of aircraft using the Airport, such as control to\Jers, signals, beacons, wind indicators, floodlights, landing lights, boundary lights, construction lights, radio and electronic aids or other aids to operations, navigation or ground com:rol of hlrc:::-aft whether or not of a type herein mentioned and even though located at sites located away from the other Public Aircraft Facilities or outside the Airport.

- 100

-TERM. C 484



### The designation by 

### the Port Authority by 

### Rules or Regulations, ?romulgated pursuant to Section 11 hereof, of particular portions of the Public Ramp and Apron Space for use by 

### the aircraft of particular Aircraft Operators or for use by 

### particular types of aircraft or for use fer particular operations shall not affect the status of such Space as Public Aircraft Facilities. In addition to anything hereinbefore contained, to the extent that the 

### present and future air traffic needs of the New

**York-~ew** 

### Jersey Port District and economic and teclL'l:.cal changes in t:::ansportaion by aircraft justify and subject to available land and commensurate ,.,.ith the reasonably prudent operation of the Airport, and so far as economically practicable in the light of the flight fees that the Lessee and the other Airline Lessees pay and subject to the ability of the Port Authority to finance such construction and maintenance, the Port Authority

**du~ing** 

### the ter-m cf the letting under this Agreement shall provide reasonably suitable Public Aircraft Facilities for such traffic needs. The Port Authority shall maintain such ?ublic Ai:::craft Facilities, as and when provided, in a

**rr~nne=** 

### consistent with the operation of the Airport by a reasonably prucent Airport 

### Ope::a::or. Section 52. Use a£ Public Aircraft Facilities The Public

**Aircraf~** Facilities shall. be a...rai2.- able fer use by the Lessee, in

**co~n** with other

**Ai~~ra=~** 

### Ope:::ators authorized by 

### the Port Authority to use such

**facili~i2s,** for and in connection with

**ai:c~a=t** developing a 

### stress in =igid paveillent (if

**rig~d** ?2Vement 

### is used)

**~o** 

### g:::eater tban that caused by the 

### DC 8-50 Series with a maximum gross weight of 325,000 

### pounds or in

**connec~ion f.o/i~h**  ..:tircr3.it 

### for which the thickness of flexible pavement (if flexible ?avement is used) is no greater

**th~n** that necessary for the 

### above designatec aircraft. The Public

**~ircr2ft** Facilities

**~ay,** 

### in 

### the sole

**c~scretion** 

### of the Por"= Aut.ho=ity, also be made availab:e £a;: use by 

### aircraft other than that mentioned above cr i::1cl:.::.ded 

### in the aforesaid categories provided such aircza:t, in tbe Port

**A.u~ho:::-ity's** sole judgment, will not cause LL""tdue rnrear and te3.r to and may safely use tj1e Public Aircraft Facilit.i.es. 

### NotwithstanCir.g

**~ny** 

### of 

### the foregoing, 

### the use of the 2cblic Aircraft

**Fa~ilit~es** 

### shall be subject to

**~xist** ing Port

**Au~hority** Rules anC

**Regulat~ons** and

**sue~ f~r~her** 



### - 101

-TERl1. C 1284
SCHEDULE A
The Lessee shall pay the Base Annual Rental at the rate and at the time stated in paragraph (b) of Section 5 of the Agreement to which this Schedule is attached (which Agreement is hereinafter sometimes called "the Lease"), as said rate is to be adjusted as of the Base Annual Rental commencement

**date,~** until the said rate is further adjusted, all as hereinafter provided. After the close of calendar year 1984 and after the close of each calendar year thereafter, the Port Authority will adjust the Airport Services Factor of the Base Annual Rental specified in paragraph (b) of Section 5 of the Agreement, upwards or dowm;ards, as follows: I. The Port Authority shall determine the total of the following major elements of costs actually incurred or accrued during the calendar year for which the adjustment is being made, in connection with Air;:>ort Services: (a) Fixed charges on Port Authority invest..'"!lent in Airport Services. (b) The Port Authority's cost of direct labor,

**mate~ials,** payments to contractors and

**s~p** pliers and other costs for operation, maintenance, repairs and replacements charged directly to Airport S·ervices, and the pro rata

**sha~e** of the cost of snow and ice removali such

**ccs~s,** however, to exclude those charged to Port Authority non-revenue producing areas. (c) The Port Authority 1 s cost of direct

**labo~,** materialsr payments to contractors and suppliers and other costs charged directly to Policing and Traffic functions at the Airport (whether performed by the Airport Police Section or such

**othe~** sections or other Port Authority organization unit or units as may

**here~fter** perform the same or siillilar functions). (d) The Port Authority's cost of labor which was charged di!:'ectly to the Airp-ort Hana.gerfs Office (or such other Port

**A~thc~ity** office or organization unit or units as may hereafter from tirr.e. to tim0 perfo:r-m the sarz1e or s imilc.r functi::>:ts). II.

**~he** Port Authority shall also

**~eterrnine** during the calendar year for which the adjustme;1t is being m,3.de the percentage of total developed land area at the Airport occapied by the Lessee's premises. Page l of Schedule ATER11. C 1284 '

reasonable rules and regulations as the ?ort Authority may from time to time promulgate pursuant to Section 11 hereof including, without limitation thereto, such furtcher rules and regulations as impose other or different restrictions as to the types, weights or characteristics oZ aircraft which may use the same. The Port Authority by such rules and regulations may forbid or li8it the use of the Public Aircraft Facilities by aircraft for reasons other than herein set forth, even though such aircraft meet the requirements of this Section with c:espect to Maximum \'Ieight for Take-off. Section 53. Payment of Flight Fees (2) (l) Commencing on the Completion Date (hereinafter sometimes called the "Schedule C Date") and continuing up to and including December 31, 1998, the Lessee/ shall pay to the Port Authority the flight fees established by the Port Authority from time to time in accordance with the provisions of Schedule C, for each and every take-off of each and every aircraft operated by the Lessee. The said flight fee shall be a fee (per thousand pounds of Maximum \'Ieight for Take-off) prorated to the nearest hundred pounds. The said flight fee is made up to two factors, a P.A.F. Charge Factor and an Airport Services Charge Factor, as set forth in Schedule C. It is recognized that the North Terminal Lease (as defined in Section 92 hereof)

**i~cludes** among other thingsr provisions for the Lesseefs

**pa]~ents** of flight fees in accordance with the provisions thereof and Schedule C attached thereto. Upon the Schedule C Da.te, as defined in this Section 53, the Lessee's paymcmts i!1 respect of its flight fees shall be pursuant to the provisious of this Section and Schedule C attached hereto, and that any required adjustments of the flight fees and 10ayments resulti,-,g

**~rom** such adlustments as called fer under Section 54 and Schedule C of the North Terminal Lease shall survive any amendment or surrender of the North Terminal Lease as called for under Section 92 hereof and be covered by the Lease. (2) It is recognized that the flight fee po:-ovisicns contained ir. Schedule C are effective throuah December 3l, 1998. It is hereby agreed that for the

**po.~tion**



### - 102

-TC:iU-1. C ll84 of the term hereunder subsequent to December 31, 1998, the Port Authority and the Lessee shall negotiate in good faith toward the establishment of provisions covering the determination of the flight fees payable by the Lessee for the portion of the term commencing January 1, 1999 through the expiration date of the term of -the letting hereunder, and upon the establishment of the

**s~~e** the Lessee shall pay flight fees in accordance with said provisions for said portion of the term. If the parties do not reach such agreement, the Lessee shall pay flight fees in accordance with the Port Authority's Schedule of Charges for said portion of the term commencing January 1, 1999. (b) "Maximum Weight for Teke-off" when used with reference to aircraft shall mean the Maximum Weight at which such Aircraft is authorized to take-off from the Airport 

### by the Federal Governmental Agency or Agencies having jurisdiction, under conditions of zero wind velocity and standard atmosphere, on the least restricted Runway vlhich is available for take-off by such Aircraft under the Rules and Regulations of the Port Authority, provided, that

**R~~ways** shall be deemed to be available for use under the Rules and Regulations of the Port Authority, within the m.ea:-ting of this definition, 

### i!1 cases where they are not actually a'!ailable for s;eriods of less tha'1 forty-eight (48) hours because of snow, ice or other temporary emergency conditions. If such Maximum Weight is not specified by such Agency or Agencies, then said phrase shall mean the highest

**~1aximem** Authori:::ed \'leight for Take-off of other Aircraft of the same type and model at the time of take-off.

1'Maximur:t

**~.Yeigh·t** for Laod.::..ngH when U!:;ed with reference to Aircraft shall mean the t1aximum Weight at ·.-.rhich such Aiccraft is authorized to land at the Airport

**~y** the F-=deral Governmental Agency or Agencies having jurisdiction, under conditions of zero wind velocity and standard atmosphere, on the lea.st restricted Ru..T..ray "'hich is avilable for landing by such Aircraft under the Rules and Regulations of the Pert Authority, tJrovided, that Runways sha:i.l be deemed to be avail**ab~e** for use under '.:.he Rules and Regulations of the Port

**Au~hority,** within the meaning of this definition, in cases where they are not actually a-,.tailable for

**pe~::.ods** of less than forty-eight (48) hcurs because of

**sno•>~,** ice, ore other temporcary emerge!lcy conditions. If such Maxim;.h-n Height is not s,:>ecified by such Agency or Agencies, then said phrase shall mean the highest 11aximurn Authcr::.zed ;;eight for Landing of other .'\ircra=t of the same type and model qt the time of landing.

- 103

-TERM. C 1284

(c) Commencing no later than the 20th day of the month following the month during which the Schedule C Date occurs and no later than the 20th day of e3ch and every month thereafter during the term of this Agreement, including the month following the expiration of this Agreement, the Lessee shall furnish to the Port Authority a statement duly certified by an authorized officer of the Lessee certifying the number of take-offs by type of Aircraft operated by the Lessee during the preceding calendar month. The Lessee shall pay to the Port Authority at the time it is obligated to furnish to the Port Authority the foregoing statement the flight fees payable by the Lessee for its aircraft operations during the preceding calendar month computed on the basis of said operations and the flight fees determined in accordance with Schedule C. The flight fees payable by the Lessee hereunder shall be in addition to any and all rents, charges and fees imposed upon and payable by the Lessee whether or not the Lessee uses any or all of the Public Aircraft Facilities in addition to the run\vays. Section 54. Fuel Storage and Distribution System (a) The Port Authority has built and constructed an Aviation Fuel Storage and Distribution System, hereinafter referred to as "the Fuel System' 1 • The Port Authority hereby reserves the right 

### in its discretion, and from time to ti.me 1 to enlarge or reduce or modify the Fuel System, to make changes in and to the design thereof and to make other changes which it may deem

**~ecessary** or desi:-able

_ As used in this Agreement and in Schedule D (attached hereto and made a part hereof) , the term "Fuel System" shall mean and include the Bulk Storage Area (the location of which is sho;m on Exhibit (D), the Distribution Facilities and Lhe Terminal Distribution Units. The Bulk Storage Area shall include storage

**tan~s** and incidental physical facilities for the

**receiving~** storing and dispensing of aviation fuel by pipeline including pumps and piping for unloading over-the-road fv.el trucks, floating roof tanks and a!)purtenances within dike walls, pt:mp suction piping and manifolds, pumps, filter separators, controls c.nd

- 104

-

### TERM C lJ84

SCHEDULE C
I. 

### (a) Commencing on the Schedule C Date as defined in Section 53 of Port Authority Agreement No. hNA-170 (hereinafter called "the Agreement") with Peo?le Express Airlines, Inc. (hereinafter called ''the Lessee") at Newark International Airport (hereinafter called "the Airport"), and continuing up to and including December 31, 1998, the Lessee shall pay to the Port Authority a flight fee for each and every take-off made by any aircraft operated by the Lessee. For calendar year 1984 a

**tenta~ive** 

### flight fee has been established for each and every take-off at the rate of $2.1860 per thousand pounds of Maximum Weight for Take-Off. It is understood that this flight fee is tentative only and represents the sum of the following factors: (1) A P.A.F. Charge Factor, which pertains to the Port Authority's snow removal O?erations and provision, operation, maintenance, servicing, repair and replacement of and to the Public Aircraft Facilities and Airport emergency services. (For calendar year 1984, $0.98295 of the tentative .flight fee of $2.1860 per thousand pounds represents

**G~e** 

### tentative P.A.F. Charge Factor); and (2) An 

### Airport Services Charge Factor which pertains to the Port Authority's snow removal operations and provision, operation, maintenance, repair and replacement with respect to Airport. Se:!..-vices. (For 

### calendar year 1984, $1.20302 per thousand pounds represents the tentative Airport Services Charge Factor)
. I:i:. It is hereby acknowledged that the Pert Authority established a tentative flight fee for calendar year 1973 at the rate of $0.6300 and that said

**~ee** 

### has been adjusted each calendar year thereafter as hereinafter set

**forL~,** 

### resulting in the

**tentat~ve** 

### flight fee set forth in Section

**~** 

### hereof. After the close of calendar year 1984 and after the close of each calendar year thereafter, the Port

**Au~~ority** 

### will adjust the tentative flight fee for the applicable calendar year, upwards or dowm;ards, to a finalized flight fee for each such calendar year, as follows: (il.) 

### P.A.F. Charge Factor (1) The Port Authority shall determine the total of the following major elements of costs actually incurred or accru.ed during ·=he calendar year for which the adjustment is being made in Page 1 of Schedule 

## c

### TERM C 1084
connection with the Public Aircraft Facilities: (a) fixed charges on Port Authority

**~nvestment** 

### ih Public Aircraft Facilities; and (b) the Port Authority's cost of direct labor, materials, payments to contractors

**~~d** 

### suppliers, the Port Authority's cost charged to the Emergency Service Functions at the Airport (whether performed by the Airport Police Section or other section or

**sect~ons** 

### or other Port Authority organization unit or units as may hereafter perform

**~~e** 

### same or similar functions), other costs for the operation, maintenance, repair and replacement of Public Aircraft Facilities, and

**~~e** 

### pro rata share of the cost of snow and ice removal. (2) The Port Authority shall also determine the total Maximum Weight f::>r '!'ake-Off of all aircraft using the Airport during the calendar year for which the adjustment is being made except such aircraft as are not required to pay a flight fee, such as government flights, etc. (3) The Port Authority '"'ill multiply

**~'le** 

### s=. of $0.3130 representing the tentative P.A.F. Charge Factor for 1973 by a fraction the numerator of which shall be the total of the actual elements of cost

**descr~bed** 

### in subparagraphs (a) and (b) of the preceding paragraph (A) (l) and the denominator of which shall be $4,010,000.00; the resulting product shall then be multiplied by 

### a fraction, the numerator of which shall be 17,734,000,000 poGnds and the denominator of which shall be the total

**M~~irnum** 

### Weight for Take-Off

**deterr.~ned** 

### in the preceding paragraph (A) (2);

**~~d** 

### the resultant product shall be the final P.A.F. Charge Factor of the finalized flight fee for L'le calendar year for which the

**adjus~~en~** 

### is being made. (B) Airport Services Charge Factor (l) The Port

**Au~~ority** 

### shall determine

**~'e** 

### total of the following major elements of cost actually incurred or accrued during the calendar year for which the

**adjusG~ent** 

### is being made, as described in Paragraph I, subparagraphs (a)

**~~rough** 

### (d) in Schedule A attached to this Agreement. (2) The Port

**AuL~ority** 

### shall also

**dete~ine** 

### i±e percentage of total developed l2.nd area at the Airpors occupied by the Public Aircraft Facilities during r.he calendar year for which the adjustment is being made. Page 2 of Schedule c

## • TERM C 1084
(3) The Port Authority will multiply the sum of 

### $0.3370 representing the tentative Airport Services Charge Factor of the tentative flight fee for calendar year 1973 by a fraction the numerator of which shall be the total of the actual major elements of costs determined under the preceding paragraph (B) (1) and the denominator of which shall be 

### $4,625,000.00; the resulting product shall be multiplied by a fraction the numerator of which shall be 

### 17,734,000,000 pounds and the denominator of which shall be the total Maximum Weight for

**T~~e-Off** determined in paragraph (A) (2) above; and that product shall then be multiolied bv a fraction the numerator of which shall be the

**perce~tage d~termined**  in paragraph (B) (2) above and the denominator of which shall be 66.47%. (4) The resultan·t :oroduct shall ce the final Airport Services Charge Factor of the finalized flight fee for the calendar year for which the adjustment is being made. (C) The final P.A.F. Charge Factor and the final Airport 

### Services Charge Factor as determined above shall be added together and the sum thereof shall constitute the finalized flight fee for the calendar year for which

**L~e**

**adjusL~ent** 

### is being made. It shall also constitute the tentative flight fee for the calendar year in which such adjustment is calculated, and such flight fee will be expressed in cents per thousand pounds of Maximum \\eight for Take-Off. The finalized flight fee shall be mul;:iplied by the total

**Maximw~** Weight for Take-Off (in thousands of pounds) of all aircraft operated by the Lessee which tcok off from the Airpm:·t during the calendar year for which the

**adjusL~ent** is being made and during the calendar

**mon~~s** which have elapsed since the close of said calendar year. The resultant product shall constitute the total flight fee charges payable by the Lessee to the Port

**AuL~ority** for the Lessee's use of the Public l'.ircraft Facilities durin.g L'1e calendar year for which L'1e adjustment is being made, and for the months which have elapsed since the close of the said calendar year. The Lessee shall continue to nake ?ayr.1ents based on the new tenta;:ive :!:light fee until the

**sa~e** is further adjusted.
Page 3 of Schedule 

### C

### '



### •

• **TEK~** 

### C 1084
Any deficiency due to the Port Authority from the Lessee for any calendar year resulting from adjustment of the flight fee shall be paid to the Port Authority by the Lessee within thirty (30) days after demand therefor and any excess payments made by the Lessee determined 

### on the basis of an adjusted flight fee shall be credited against future flight fee charges, such credit to be made within thirty {30) days following the adjustment of the flight fee. The calculation of the adjustment to the flight fee will be made for each calendar year thereafter by no later than April 30th of the following calendar year. (D) All percentage shares calculated under this Schedule C shall be expressed in decimals to the nearest ten thousandth
. (E) All flight fees payable under the Agreement shall be expressed in cents per thousand pounds of Maximum Weight for Take-Off to the nearest ten-thousandth of a cent.

For

**th~Authority** 

### Initialled:
For the Lessee

Page 4 of Schedule C