Document:

Exhibit 10.5

 

INTERCHANGE AGREEMENT

 

THIS INTERCHANGE AGREEMENT is made and entered into as of the 1st day
of March, 2002, by and between CSC TRANSPORT
IV, INC., a Delaware corporation with an office at 8000 Republic
Airport, Hangar 5, Farmingdale, New York 11768 (“CSC”), and STERLING AVIATION LLC, a New York limited
liability company with an office at 340 Crossways Park Drive, Woodbury, New
York 11797 (“Counterparty”).

 

W  I
T  N  E  S  S  E  T  H:

 

WHEREAS, CSC is the
lessee and the operator of a Gulfstream Aerospace Corporation G-V aircraft,
manufacturer’s serial number 639, United States registration N501CV (the “CSC
Aircraft”); and

 

WHEREAS,
Counterparty is the sublessee and the operator of a Gulfstream Aerospace
Corporation GIV-SP aircraft, manufacturer’s serial number 1230, United States
registration N101CV (the “Counterparty Aircraft”); and

 

WHEREAS,
each of CSC and Counterparty employs or engages its own fully-qualified flight
crew to operate its respective aircraft; and

 

WHEREAS, each of CSC
and Counterparty desires to lease its respective aircraft, with flight crew, to
the other, solely in exchange for equal time, when needed, on the other’s
aircraft, on an interchange basis as defined in Section 91.501(c)(2) of
the Federal Aviation Regulations (the “FAR’s”), upon the terms and subject to
the conditions set forth herein;

 

NOW,
THEREFORE, in consideration of the foregoing premises and the mutual covenants
and agreements set forth herein, and for other good and valuable consideration,
the receipt and sufficiency of which are acknowledged, CSC and Counterparty,
intending to be legally bound, hereby covenant and agree as follows:

 

1.             Lease of Aircraft.

 

(a)           When not otherwise obligated by its
flight schedule, CSC agrees to lease the CSC Aircraft to Counterparty pursuant
to the provisions of FAR 91.501(c)(2) and to provide a fully-qualified
flight crew for all operations of the CSC Aircraft to be conducted hereunder
during the Term (as defined in Section 12) of this Agreement, in exchange
for Counterparty’s undertaking to lease the Counterparty Aircraft to CSC
pursuant to Section 1(b) for an equal number of flight hours
(including fractions thereof), plus, if applicable, the Expense Differential
(as defined in Section 2(c) hereof) and the

 

 

Reconciliation Amount (as defined in Section 14 hereof), if any.

 

(b)           When not otherwise obligated by its
flight schedule, Counterparty agrees to lease the Counterparty Aircraft to CSC
pursuant to the provisions of FAR 91.501(c)(2) and to provide a
fully-qualified flight crew for all operations of the Counterparty Aircraft
hereunder during the Term in exchange for CSC’s undertaking to lease the CSC
Aircraft to Counterparty pursuant to Section 1(a) for an equal number
of flight hours (including fractions thereof), plus, if, applicable, the
Expense Differential and the Reconciliation Amount, if any.

 

2.             Payments; Expenses; Expense
Differential; Statements.

 

(a)           For each flight hour received by a
party under this Agreement, the recipient agrees to assume and to satisfy a
reciprocal obligation of repayment in kind by providing an equal number of
flight hours aboard the recipient’s aircraft. 
For purposes of this Agreement, flight hours will be measured to the
nearest tenth of an hour. The right to repayment of flight hours in kind, at a
1:1 ratio, is the only compensation to which the party providing the
transportation with its aircraft (in either case, the “Operator”) is entitled
under this Agreement, other than the Expense Differential, if applicable, and
Reconciliation Amount, if any.

 

(b)           Each party shall pay all expenses
related to the operation of its aircraft at all times during the Term
(collectively, “Expenses”), regardless of which party is using such aircraft at
the time such expenses are incurred. 
This obligation shall include any and all direct and indirect expenses
of operating such aircraft, as well as storage, crew, maintenance, and
insurance costs, on-board meals and beverages, airport, weather and related
user fees, and any and all other expenses, whether similar or dissimilar to the
foregoing, incurred by or because of the operation of the aircraft.

 

(c)           In the event that the Expenses of
owning, operating and maintaining one party’s aircraft exceeds such Expenses
for the other aircraft, the party whose aircraft has the greater Expenses shall
invoice the other party for any portion or all of the excess Expenses (the “Expense
Differential”) allocable to the use by the other party pursuant to this
Agreement from time to time, but in no event less frequently than annually and
within 30 days after the expiration or other termination of this Agreement.
Such invoice shall be due and payable not later than 30 days after receipt
thereof.

 

(d)           As soon as possible after the end of
each calendar month during the term of this Agreement, CSC shall generate and
furnish to Counterparty a statement reflecting (i) all use by each party
of the other party’s Aircraft pursuant to the terms of this Agreement during
such month and during the period from the effective date of this Agreement
through the end of such month; and (ii) the Expense Differential, if any,
incurred during such calendar month and during the period from the effective
date of this Agreement through the end of such calendar month.

 

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(e)           Notwithstanding anything in this
Agreement to the contrary, (i) in the event that the statements generated
by CSC pursuant to Section 2(d) indicate that the cumulative use by
CSC of the Counterparty Aircraft pursuant to this Agreement exceeds the
cumulative use by Counterparty of the CSC Aircraft by 50 flight hours or more,
Counterparty shall have no obligation to allow CSC to utilize the Counterparty
Aircraft hereunder until such excess has been reduced to less than 50 flight
hours; and (ii) in the event that such statements indicate that the
cumulative use by Counterparty of the CSC Aircraft pursuant to this Agreement
exceeds the cumulative use by CSC of the Counterparty Aircraft by 50 flight
hours or more, CSC shall have no obligation to allow Counterparty to utilize
the CSC Aircraft hereunder until such excess has been reduced to less than 50
flight hours.

 

3.             Operational Control of Aircraft.

 

(a)           CSC and Counterparty intend and agree
that at all times during the Term of this Agreement, CSC shall have complete
and exclusive operational control over the CSC Aircraft, its flight crews and
maintenance, and complete and exclusive possession, command and control of the
CSC Aircraft.  CSC shall have complete and
exclusive responsibility for scheduling, dispatching and flight following of
the CSC Aircraft on all flights conducted during the Term of this Agreement,
which responsibility includes the sole and exclusive right over initiating,
conducting and terminating such flights. 
Counterparty shall have no responsibility for scheduling, dispatching or
flight following on any flight of the CSC Aircraft, nor any right over
initiating, conducting or terminating any such flights.  Nothing in this Agreement is intended or
shall be construed so as to convey to Counterparty any operational control
over, or possession, command and control of, the CSC Aircraft, all of which are
expressly retained by CSC.

 

(b)           CSC and Counterparty intend and agree
that at all times during the Term of this Agreement, Counterparty shall have
complete and exclusive operational control over the Counterparty Aircraft, its
flight crews and maintenance, and complete and exclusive possession, command
and control of the Counterparty Aircraft. 
Counterparty shall have complete and exclusive responsibility for
scheduling, dispatching and flight following of the Counterparty Aircraft on
all flights conducted during the Term of this Agreement, which responsibility
includes the sole and exclusive right over initiating, conducting and terminating
such flights.  CSC shall have no
responsibility for scheduling, dispatching or flight following on any flight of
the Counterparty Aircraft, nor any right over initiating, conducting or
terminating any such flights.  Nothing in
this Agreement is intended or shall be construed so as to convey to CSC any
operational control over, or possession, command and control of, the
Counterparty Aircraft, all of which are expressly retained by Counterparty.

 

4.             Scheduling.

 

(a)           Each party will provide the other
with requests for flight time and

 

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proposed flight schedules as far in advance of any given flight as
possible, and in any case, at least 24 hours in advance of planned
departure.  Requests for flight time
shall be in a form, whether oral or written, mutually convenient to, and agreed
upon by the parties.  Scheduling requests
by one party under this Agreement shall be submitted to the designated
authorized representative(s) of the other party set forth in Exhibit A
hereto (as amended from time to time). 
In addition to proposed schedules and flight times, the party requesting
flight time shall provide at least the following information for each proposed
flight at some time prior to scheduled departure as required by the Operator or
flight crew assigned to its Aircraft: (i) proposed departure point; (ii) destination;
(iii) date and time of flight; (iv) number of passengers anticipated;
(v) nature and extent of luggage and/or cargo to be carried; (vi) date
and time of a return flight, if any; and (vii) any other information
concerning the proposed flight that may reasonably be requested by the Operator
or its flight crew.

 

(b)           Each party hereby agrees to use its
best good faith efforts in order to accommodate the needs of the other party,
avoid conflicts in scheduling, and enable the other party to enjoy the benefits
of this Agreement; provided, however, that each party shall have final
authority over the scheduling of its aircraft. 
Each party agrees to make good faith efforts to honor flights requested
by the other party under this Agreement. 
Nevertheless, the parties explicitly acknowledge that the needs of each
party for its own transportation take precedence over this Agreement.  Although every good faith effort shall be
made to avoid its occurrence, any flight scheduled under this Agreement is
subject to cancellation by either party without incurring liability to the
other party.  In the event that
cancellation is necessary, the canceling party shall provide the maximum notice
practicable.  Any changes to a flight
arranged under this Agreement, or a cancellation of a flight in its entirety,
shall be communicated to the designated authorized representative(s) of the
other party.

 

(c)           Any notice under this Section 4
may be written or oral, but shall be given only to or by individuals previously
designated by each party to the other pursuant to Exhibit A as amended
from time to time as authorized to act on its behalf for this purpose.

 

5.             Maintenance.  Each party shall be solely responsible for
securing maintenance, preventive maintenance and other necessary inspections on
its aircraft at all times during the Term, and shall take such requirements
into account in scheduling its aircraft, unless said maintenance or inspection
can be safely conducted at a later time in compliance with all applicable laws
and regulations, and within the sound discretion of the pilot-in-command.  All maintenance, whether scheduled or
preventive in nature, will be the responsibility of the Operator.  The responsibility for determining that all
required maintenance has been compiled with will rest with the Chief of
Maintenance for the Operator. The pilot-in-command shall have final and
complete authority to cancel any flight for any reason or condition, whether or
not maintenance related, that in his judgment would compromise the safety of
the flight.

 

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6.             Flight Crew.

 

(a)           Each
party shall provide, at its sole cost and expense, a qualified flight crew for
each flight undertaken on its aircraft under this Agreement. The flight crew
provided will be comprised of the pilots employed or engaged by the
Operator.  However, the Operator may use
temporary flight crewmembers for a flight under this Agreement provided that
the temporary crewmember is FlightSafety (or SimuFlite) trained, is current on
the aircraft to be flown and satisfies all of the requirements and conditions
under the insurance coverage for such aircraft.

 

(b)           In
accordance with applicable Federal Aviation Regulations, each qualified flight
crew provided under this Agreement will exercise all of its duties and
responsibilities in regard to the safety of each flight conducted
hereunder.  The Operator and its flight
crew will retain operational control of that aircraft.  Each aircraft shall be operated under the
standards and policies established by the Operator.  Final authority to initiate or terminate each
flight, and otherwise to decide all matters relating to the safety of any given
flight or requested flight, shall rest with the Captain of that flight.

 

(c)           Each
party agrees that the flight crew, in its sole discretion, may terminate any
flight, refuse to commence any flight, or take other action that in the
considered judgment of the pilot-in-command is necessitated by considerations
of safety.  No such action of the
pilot-in-command shall create or support any liability for loss, injury, damage
or delay to either party or any other person. 
The parties further agree that neither party shall be liable for delay
or failure to furnish or return an aircraft or crew pursuant to this Agreement
when such failure is caused by government regulation or authority, mechanical
difficulty, war, civil commotion, strikes or labor disputes, weather conditions,
or acts of God or any other cause which is beyond its control, whether similar
or dissimilar to the causes enumerated.

 

7.             Home Base.  The permanent base of operation of the CSC
Aircraft is Republic Airport, Farmingdale, New York. The permanent base of
operation of the Counterparty Aircraft is Republic Airport, Farmingdale, New
York.

 

8.             Insurance; Risk of Loss.

 

(a)           During the term of the Agreement, and
notwithstanding anything in this Agreement to the contrary, Counterparty will
procure at its sole cost and expense aircraft insurance that satisfies all of
the requirements of the Aircraft Lease (N101CV), dated as of April 29,
1998, as amended, between Fleet National Bank, as lessor (“Headlessor”), and
CSC Transport V, Inc., as lessee (as assignee of CSC Transport, Inc.)
(the “Headlease”), and all of the requirements of the Aircraft Lease dated as
of March 1, 2002, between CSC Transport V, Inc. as lessor and
Counterparty as lessee (the “Lease”),

 

5

 

and CSC will procure at its sole cost and expense aircraft insurance
that satisfies all of the requirements of the Aircraft Lease Agreement dated November 1,
2001 between General Electric Credit Corporation of Tennessee as lessor and CSC
as lessee (the “GECC Lease”).

 

(b)           During the Term of this Agreement,
each party shall maintain (or cause to be maintained) in full force and effect,
at its own expense, workers compensation and employer liability coverage in the
amount of not less than the applicable statutory limits covering all employees
whose work relates to the Aircraft.

 

(c)           Each party shall deliver certificates
of insurance and copies of applicable policies to the other party with respect
to the insurance required hereunder. 
Such certificates shall be delivered upon execution of this Agreement
and upon the renewal date of each policy. 
Each certificate of insurance, and the applicable policy, shall require
that 30 days’ prior written notice of cancellation or change (seven days, or
such shorter period as is customarily available in the business aviation
industry in the case of war risk or allied perils) be given by the insurer to
the insured and all additional insureds.

 

(d)           Each party shall have and maintain at
all times during the Term of this Agreement risk of loss of or damage or
destruction to its aircraft.

 

9.             Indemnity. 
Each party (the “Indemnitor”) covenants and agrees that except with
respect to a loss covered (or required to be covered) by the insurance
described in Section 8 hereof, it shall be fully liable to, and shall
promptly upon demand defend, indemnify and hold harmless the other party and
its respective principals, shareholders, members, managers, officers,
directors, agents, guests, invitees, licensees and employees (collectively, the
Indemnitees”) from and against any and all liabilities, claims, demands, suits,
causes of action, losses, penalties, fines, expenses or damages, including
reasonable attorneys fees, court costs and witness fees attributable to the
Indemnitor’s use, operation or maintenance of an aircraft pursuant to this
Agreement or performance of or failure to perform any obligation under this
Agreement.  For purposes of this
Agreement, (i) Counterparty and its members, managers (if any), guests,
invitees, licensees and employees shall be the Indemnitees in any case in which
CSC is the Indemnitor; (ii) CSC and its officers, directors, employees,
shareholders, guests, invitees, licensees, employees and affiliates (excluding
Counterparty and its members and managers, if any) shall be the Indemnitees in
any case in which Counterparty is the Indemnitor; and (iii) notwithstanding
the foregoing, in the event that there is any other agreement effective at such
time between an Indemnitor and an Indemnitee, such Indemnitor shall have no greater
obligation to indemnify such Indemnitee than such Indemnitor’s obligation to
indemnify such Indemnitee set forth in such other effective agreement.

 

10.           Taxes.  Each party shall be responsible for
collecting and paying over the amount collected to the appropriate agencies all
applicable Federal transportation taxes and any sales, use or other excise
taxes imposed by any governmental authority in connection with any use of its
own aircraft by the other party under this Agreement.  Each party shall indemnify the other party
against any and all claims,

 

6

 

liabilities, costs and expenses (including attorney’s fees as and when
incurred) arising out of its breach of this undertaking.  The Operator of each flight hereunder shall
collect and pay over the amount of collected Federal excise taxes applicable to
such flight based upon the fair market value of such flight, as agreed in good
faith by the parties.

 

11.           Representations and Warranties.  Each party represents and warrants to the
other that:

 

(a)           It will use the other party’s
aircraft for and on account of its own business only, and will not use the
other party’s aircraft for the purposes of providing transportation of
passengers or cargo in air commerce for compensation or hire.

 

(b)           It shall refrain from incurring any
mechanic’s or other liens in connection with inspection, preventive
maintenance, maintenance or storage of the other party’s aircraft, nor shall
there be any attempt by such party to convey, mortgage, assign, lease or any
way alienate the other party’s aircraft or create any kind of lien or security
interest involving such aircraft or do anything or take any action that might
mature into such a lien.

 

(c)           It shall not lien or otherwise encumber,
or create or place any lien or other encumbrance of any kind whatsoever, on or
against the other party’s aircraft for any reason.  It also will ensure that no liens or
encumbrances of any kind whatsoever are created or placed against the other
party’s aircraft for claims against the first party or by the first party.  In the event that any mechanic’s liens or
other encumbrances are created or placed against one party’s aircraft by a
third person, the party whose aircraft has been subjected to such liens or
other encumbrances shall take all necessary action to discharge such liens and
encumbrances as quickly as possible.

 

(d)           During the Term, it will abide by and
conform to all such laws, governmental and airport orders, rules and
regulations, as shall from time to time be in effect relating in any way to the
operation and use of either aircraft pursuant to this Agreement.                All operations conducted under
this Agreement shall be conducted in strict compliance with all applicable
provisions of all governmental authorities having jurisdiction, including, but
not limited to, the FAA and the governmental authorities of each foreign
jurisdiction in or over which the Aircraft is or may be operated.

 

12.           Term of Agreement.  The term of this Agreement (the “Term”) shall
commence on the effective date hereof and, except as otherwise provided herein,
shall remain in full force in effect for an initial term through April 15,
2003.  In the event that Counterparty
continues to operate the Counterparty Aircraft after April 15, 2003,
Counterparty shall have the right to extend the term of this Agreement for one
additional

 

7

 

12-month term; provided, however, that
no extension shall extend beyond the expiration of the term of the Headlease,
unless Headlessor no longer has title to the Aircraft.  Notwithstanding
the foregoing, either party shall have the right to terminate this Agreement
for any reason or no reason by written notice given to the other party not less
than 30 days prior to the proposed termination date.  Notwithstanding anything herein to the
contrary, this Agreement shall terminate (i) at the option of Headlessor,
in its sole discretion, upon the occurrence of an Event of Default or Notified
Default (as such terms defined in the Headlease), or (ii) upon the
expiration or earlier termination of the Headlease.

 

13.           Termination Rights.  In addition to the termination rights set
forth in Section 12, each party shall have the right, upon written notice
to the other party (the “Defaulting Party”), to terminate this Agreement
immediately (without prejudice to any other rights that it may have) in the
event of any of the following:

 

(a)           if the Defaulting Party operates or
maintains its aircraft in violation of any law, regulation, directive or order
of any governmental authority or in violation of any provision of any insurance
policy;

 

(b)           lapse of insurance coverage required
to be kept in force by the Defaulting Party;

 

(c)           if the Defaulting Party makes a
general assignment for the benefit of creditors, or is declared insolvent or
bankrupt under any bankruptcy, insolvency or other similar law, or commence a
voluntary proceeding seeking liquidation, reorganization or other relief under
any such law or seeking the appointment of a receiver or liquidator over any
substantial portion of its assets;

 

(d)           assignment by the Defaulting Party of
this Agreement or any right or interest created hereunder without the prior
written consent of the other party, which may be given or withheld by the other
party in its sole and absolute discretion; or

 

(e)           loss or destruction of either
aircraft.

 

14.           Reconciliation on Termination.   If, upon termination of this Agreement for
any reason, one party (“Party A”) has utilized a greater amount of flight time
on the Aircraft of the other party (“Party B”), such excess time shall be
treated as if it had been flown pursuant to a time sharing agreement within the
meaning of FAR Section 91.501(c)(1). 
In such event, Party A shall promptly pay to Party B an amount equal to
the maximum allowable amount of expenses described in FAR Section 91.501(d)(1)-(10) with
respect to such specific excess flight time, determined on a last-in, first-out
basis (the “Reconciliation Amount”).

 

8

 

15.           Relationship of Parties.  The relationship between the parties is
strictly that of lessor and lessee in connection with the provision and receipt
of transportation services in accordance with the terms and conditions of this
Agreement.  Nothing in this Agreement is
intended, nor shall it be construed so as, to constitute the parties as
partners or joint venturers or principal and agent.  All persons furnished by each party for the
performance of the operations and activities contemplated by this Agreement
shall at all times and for all purposes be considered such party’s employees or
agents, and such party shall be solely responsible for their performance.

 

16.           Notices.  All notices or other communications delivered
or given under this Agreement shall be in writing and shall be deemed to have
been duly given if hand-delivered, sent by certified or registered mail, return
receipt requested, nationally-utilized overnight delivery service or confirmed
facsimile transmission.  Such notices shall
be addressed to the parties at the addresses set forth above, or to such other
address as may be designated by any party in a writing delivered to the other
in the manner set forth in this Section 16.  Such notices shall be deemed to have been
given and made on the date on which hand-delivered or sent by confirmed
facsimile, one business day following the date on which sent by Federal Express
or other nationally-utilized overnight delivery service, or four days following
the date on which sent by certified or registered mail, return receipt
requested.

 

17.           Governing Law; Severability.  This Agreement shall be governed by and
interpreted in accordance with the laws of the State of New York, without
regard to its choice of law rules.  If
any provision of this Agreement conflicts with any statute or rule of law
of the State of New York, or is otherwise unenforceable, such provision shall
be deemed null and void only the extent of such conflict or unenforceability,
and shall be deemed separate from, and shall not invalidate, any other
provision of this Agreement.

 

18.           Amendment.  This Agreement may not be amended,
supplemented, modified or terminated, or any of its terms varied, except by an
agreement in writing signed by each of the parties hereto.

 

19.           Counterparts.  This Agreement may be executed in
counterparts, each of which shall, for all purposes, be deemed an original and
all such counterparts, taken together, shall constitute one and the same
agreement, even though all parties may not have executed the same
counterpart.  Each party may transmit its
signature by facsimile, and such faxed signature shall have the same force and
effect as an original signature.

 

9

 

20.           Successors and Assigns.  This Agreement shall be binding upon the
parties hereto, and their respective heirs, executors, administrators, other
legal representatives, successors and assigns, and shall inure to the benefit
of the parties hereto, and, except as otherwise provided herein, to their
respective heirs, executors, administrators, other legal representatives,
successors and permitted assigns.  Except
as otherwise provided in this Agreement or in the Consent to Aircraft
Management Agreement and Assignment dated as of December 1, 2001, by and
among Headlessor, CSC and Counterparty (the “Consent Agreement”), each party agrees that it shall not
sublease, assign, transfer, pledge or hypothecate this Agreement or any part
hereof (including any assignment or transfer pursuant to or as a part of any
merger, consolidation or transfer of assets) without the prior written consent
of the other party, which may be given or withheld by the other party in its
sole and absolute discretion.  Each party
hereby consents to the assignment of certain rights under this Agreement to
Headlessor pursuant to, and all of the other terms and conditions of, the
Consent Agreement.

 

21.           Disclaimer of Warranties.  EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, NEITHER PARTY HAS MADE ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR
IMPLIED, WITH RESPECT TO ITS AIRCRAFT, INCLUDING ANY WITH RESPECT TO SUCH
AIRCRAFT’S CONDITION, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE.

 

22.           Integration.  This Agreement and the Consent Agreement set
forth the entire agreement between the parties with respect to the subject
matter hereof and supersedes any and all other agreements, understandings,
representations, warranties or negotiations by or between the parties with
respect thereto, all of which are hereby canceled.  There are no other agreements or
representations, either oral or written, express or implied, with respect to
the subject matter of this Agreement that are not expressly set forth herein or
in the Consent Agreement.

 

23.           Truth-in-Leasing Compliance.

 

(a)           CSC shall (i) mail a copy of
this Agreement to the FAA in Oklahoma City within 24 hours of receiving a fully
executed copy; (ii) notify the Farmingdale Flight Standards District
Office at least 48 hours prior to the first flight by CSC as Operator under
this Agreement; and (iii) carry a copy of this Agreement onboard the CSC
Aircraft.

 

(b)           Counterparty
shall (i) notify the Farmingdale FSDO at least 48 hours prior to the first
flight by Counterparty as Operator under this Agreement; and (ii) carry a
copy of this Agreement onboard the Counterparty Aircraft.

 

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24.           TRUTH IN LEASING STATEMENT UNDER
FAR SECTION 91.23:

 

(a)           CSC HEREBY CERTIFIES THAT THE CSC
AIRCRAFT HAS BEEN INSPECTED AND MAINTAINED WITHIN THE 12 MONTH PERIOD PRECEDING
THE DATE OF EXECUTION OF THIS AGREEMENT IN ACCORDANCE WITH THE PROVISIONS OF
FAR PART 91 AND THAT ALL APPLICABLE REQUIREMENTS FOR THE MAINTENANCE AND
INSPECTION THEREUNDER HAVE BEEN MET FOR ALL OPERATIONS TO BE CONDUCTED WITH THE
CSC AIRCRAFT UNDER THIS AGREEMENT.

 

(b)           COUNTERPARTY HEREBY CERTIFIES THAT
THE COUNTERPARTY AIRCRAFT HAS BEEN INSPECTED AND MAINTAINED WITHIN THE 12 MONTH
PERIOD PRECEDING THE DATE OF EXECUTION OF THIS AGREEMENT IN ACCORDANCE WITH THE
PROVISIONS OF FAR PART 91 AND THAT ALL APPLICABLE REQUIREMENTS FOR THE
MAINTENANCE AND INSPECTION THEREUNDER HAVE BEEN MET FOR ALL OPERATIONS TO BE
CONDUCTED WITH THE COUNTERPARTY AIRCRAFT UNDER THIS AGREEMENT.

 

(c)           EACH OF CSC AND COUNTERPARTY
CERTIFIES THAT WHEN THE CSC AIRCRAFT IS OPERATED UNDER THIS AGREEMENT, CSC
SHALL BE RESPONSIBLE FOR OPERATIONAL CONTROL OF THE CSC AIRCRAFT.  CSC HEREBY CERTIFIES THAT IT UNDERSTANDS ITS
RESPONSIBILITY FOR COMPLIANCE WITH APPLICABLE FEDERAL AVIATION REGULATIONS.

 

(d)           EACH OF COUNTERPARTY AND CSC CERTIFIES
THAT WHEN THE COUNTERPARTY AIRCRAFT IS OPERATED UNDER THIS AGREEMENT,
COUNTERPARTY SHALL BE RESPONSIBLE FOR OPERATIONAL CONTROL OF THE COUNTERPARTY
AIRCRAFT.  COUNTERPARTY HEREBY CERTIFIES
THAT IT UNDERSTANDS ITS RESPONSIBILITIES FROM COMPLIANCE WITH APPLICABLE
FEDERAL AVIATION REGULATIONS.

 

(e)           THE PARTIES UNDERSTAND THAT AN
EXPLANATION OF FACTORS BEARING ON OPERATIONAL CONTROL AND PERTINENT FEDERAL
AVIATION REGULATIONS CAN BE OBTAINED FROM THE NEAREST FAA FLIGHT STANDARDS
DISTRICT OFFICE.

 

(signature page follows)

 

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IN
WITNESS WHEREOF, CSC and COUNTERPARTY have caused their signatures to be
affixed below on the day and year first above written.

 

	
   

  	
  CSC
  TRANSPORT IV, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Milton Hobbs

  	
   

  
	
   

  	
   

  	
  Its Duly-Authorized Signatory

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  STERLING
  AVIATION LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  William Frewin, Jr

  	
   

  
	
   

  	
   

  	
  Its
  Duly Authorized Manager

  	
   

  
						

 

12Exhibit 10.6

 

AMENDMENT TO INTERCHANGE
AGREEMENT

 

THIS AMENDMENT TO INTERCHANGE AGREEMENT is made and
entered into effective as of March 1, 2002, by and between CSC
TRANSPORT IV, INC., a Delaware corporation with an office at 8000
Republic Airport, Hangar 5, Farmingdale, New York 11768 (“CSC”), and STERLING AVIATION LLC, a New York
limited liability company with an office at 340 Crossways Park Drive, Woodbury,
New York 11797 (“Counterparty”).

 

W  I  T  N  E
S  S  E  T  H:

 

WHEREAS, CSC and Counterparty have
entered into an Interchange Agreement dated as of March 1, 2002 (the “Interchange
Agreement”); and

 

WHEREAS, Section 18 of the Interchange
Agreement provides that the Interchange Agreement may be amended by a written
instrument executed by both CSC and Counterparty; and

 

WHEREAS, CSC and Counterparty
have agreed to amend the Interchange Agreement as set forth in this Amendment;

 

NOW,
THEREFORE, in consideration of the foregoing premises, and the covenants and
agreements set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:

 

1.             Section 14 of the Interchange
Agreement is hereby amended and restated in its entirety to read as follows:

 

Reconciliation for Excess
Use.   If, (i) upon termination
of this Agreement or (ii) at any time that an Expense Differential invoice
is delivered in accordance with Section 2(c), one party (“Party A”) has
utilized a greater amount of flight time on the Aircraft of the other party (“Party
B”), such excess time shall be treated as if it had been flown pursuant to a
time sharing agreement within the meaning of FAR Section 91.501(c)(1).  In such event, Party A shall promptly pay
(within 30 days of invoice) Party B an amount equal to the lesser of (i) the
number of excess flight hours (including fractions thereof ) flown by Party A
on Party B’s Aircraft, multiplied by CSC’s approved budgeted assumed hourly
cost for Party B’s Aircraft for the releavant period; or (ii) the maximum
allowable amount described in FAR Section 91.501(d)(1)-(10) with
respect to such specific excess flight time determined on a last in, first-out
basis (the “Reconciliation Amount”). Payment by Party A of the Reconciliation
Amount for each hour of excess flight time on Party B’s Aircraft during a
calendar year shall reduce the number of excess flight hours incurred by Party
A on Party B’s Aircraft for all purposes of this Agreement (including, without
limitation, Section 2(a), Section 2(e) and this Section 14)
on an hour-for-hour basis.

 

 

2.             This Amendment may be executed in
one or more counterparts, each of which shall, for all purposes, be deemed an
original, and all of which together shall constitute one and the same
instrument.  Each party may transmit its
signature by facsimile, and such faxed signature shall have the same force and
effect as an original signature.  This
Amendment shall be governed by New York law.

 

IN
WITNESS WHEREOF, CSC and Counterparty have executed this Amendment to
Interchange Agreement this 17th day of March, 2004, effective the date set
forth above.

 

	
   

  	
  CSC
  TRANSPORT IV, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Andrew Rosengard

  	
   

  
	
   

  	
   

  	
  Executive Vice
  President & Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  STERLING
  AVIATION LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  William Frewin, Jr

  	
   

  
	
   

  	
   

  	
  Its
  Duly Authorized Manager

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