Document:

Unassociated Document

    Exhibit
10.18

     

    CONFIDENTIAL
TREATMENT

    REQUESTED
PURSUANT TO RULE 24b-2

    

    

    Certain
portions of this exhibit have been omitted pursuant to a request for
confidential treatment under Rule 24b-2 under the Securities Exchange Act of
1934. The omitted materials have been filed separately with the Securities and
Exchange Commission.

    

    CROSS
LEASE EXCHANGE AGREEMENT

    (“Agreement”)

    

    
      	
              1.  LESSOR:

            	
              LW
      AIR I LLC

            
	
              2.  LESSEE:

            	
              SEE
      TRIP SHEET

            
	
              3.  AIRCRAFT:

            	
              PIAGGIO
      AVANTI P-180: 1181; N189SL

            

    

    

    4. AVAILABILITY OF AIRCRAFT FOR
LEASE.  Program Manager Avantair, Inc. sponsors a fractional
ownership Program pursuant to which Program Participants (a current list is
available from the Program Manager) own and operate fractional shares in
aircraft.  Lessor offers Aircraft, without flight crewmembers, for
short-term lease to Program Participants on the terms and conditions included
herein and using Program Manager’s procedures for the assignment of “Exchange
Aircraft” and “Core Aircraft” under the Program Documents.  Lessor’s
offer is on a non-exclusive, as needed, first-come first-served basis; Lessor
may reject any lease proposed by a Program Participant or Program Manager for
any reason or no reason, and this power is not intended to and shall not be used
to influence operational control of the Aircraft when leased to a
Lessee.

     

    5. ACCEPTANCE OF
LEASE.  A Program Participant that accepts an offer as
described in paragraph 1 above is referred to as the “Lessee” herein and leases
from Lessor a specific, identified Aircraft on the terms and conditions
herein.  Consideration for the transactions contemplated herein shall
be as set forth in Section 9 below.  LESSOR AND LESSEE AGREE THAT ANY
AIRCRAFT LEASED HEREUNDER SHALL BE LEASED TO LESSEE WITHOUT A FLIGHT CREW ON AN
"AS IS, WHERE IS" BASIS, WITH NO EXPRESS OR IMPLIED WARRANTIES OF ANY KIND
WHATSOEVER AND SPECIFICALLY SUBJECT TO LIMITATIONS OF LIABILITY AND THE TRUTH IN
LEASING STATEMENT BELOW.

     

    6. TERM. The term (“Term”) of
this Agreement shall (i) commence, as to each Lessee who accepts Lessor’s offer
above, immediately prior to Lessee’s departure (the “Cross Lease Start Date”)
and (ii) end at the completion of each Lessee’s trip upon the
Aircraft.  Each Lessee, or Lessee’s authorized representative, shall
acknowledge and agree to the terms and conditions of this Agreement for the
cross lease of the Aircraft by Lessor to Lessee for each scheduled trip
commencing the Term of this Agreement by consenting to a trip sheet prior to
departure for each leg flown on Lessor’s Aircraft by Lessee (attached hereto as
Appendix C is a sample trip sheet).

     

    7. TRUTH IN LEASING STATEMENT.
LESSOR WARRANTS AND LESSEE ACKNOWLEDGES THE FOLLOWING TRUTH IN LEASING STATEMENT
UNDER FAR 91.23 FOR ANY AIRCRAFT LEASED HEREUNDER: (I) SUCH AIRCRAFT, WITHIN THE
TWELVE (12) MONTH PERIOD PRECEDING THE DATE OF THE PROGRAM DOCUMENTS (EXCEPT TO
THE EXTENT SUCH AIRCRAFT IS LESS THAN TWELVE (12) MONTHS OLD) HAS BEEN, AND
DURING THE LEASE TERM SHALL BE, INSPECTED AND MAINTAINED IN ACCORDANCE WITH FAR
PART 91, SUBPART K (OR ANY SUCCESSOR THERETO OR REPLACEMENT THEREOF APPLICABLE
TO THE PROGRAM) OR FAR PART 135, AND ALL APPLICABLE REQUIREMENTS FOR MAINTENANCE
AND INSPECTION THEREUNDER HAVE BEEN COMPLIED WITH; (ii) LESSEE ACKNOWLEDGES AND
CERTIFIES THAT WHEN LESSEE OPERATES SUCH AIRCRAFT, LESSEE SHALL BE KNOWN AS,
CONSIDERED, AND IN FACT WILL BE THE OPERATOR OF SUCH AIRCRAFT, AND LESSEE
UNDERSTANDS THE RESPONSIBILITIES OF LESSEE FOR COMPLIANCE WITH FAR PART 91,
SUBPART K (OR ANY SUCCESSOR THERETO OR REPLACEMENT THEREOF APPLICABLE TO THE
PROGRAM); (iii) AN EXPLANATION OF THE FACTORS BEARING ON OPERATIONAL CONTROL AND
PERTINENT FEDERAL AVIATION REGULATIONS CAN BE OBTAINED FROM THE NEAREST FAA
FLIGHT STANDARDS DISTRICT OFFICE; AND (iv) LESSEE ACKNOWLEDGES AND AGREES THAT A
TRUE COPY OF THIS AGREEMENT SHALL BE CARRIED ON SUCH PROGRAM AIRCRAFT AT ALL
TIMES DURING THE LEASE THEREOF, AND SHALL BE MADE AVAILABLE FOR INSPECTION UPON
REQUEST BY A REPRESENTATIVE OF THE FAA.

     

    
      [***]
Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment
request.

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    8. RELATIONSHIP OF THE
PARTIES.  Lessee acknowledges that Lessee is the operator of
any Aircraft furnished to Lessee under this Agreement and holds sole authority
over initiating, conducting, or terminating a flight ("Operational Control") with
respect to such Program Aircraft under Part 91K of the Federal Aviation
Regulations (“FARs”),
unless Program Manager chooses to operate the flight under FAR Part
135.  Lessor and Lessee agree that Program Manager is
performing services under this Agreement solely as an independent
contractor.

     

    9. FEES.  Lessee acknowledges and
agrees that use of Lessor’s Aircraft shall be at a rate of $[***] per
hour.  Owner acknowledges and agrees that Program Manager, on Lessee’s
behalf, shall pay the fees due hereunder. 

     

    

    IN WITNESS OF THE FOREGOING,
including the Terms and Conditions appended hereto and made a part hereof, and
in consideration of the promises, covenants and agreements herein and for other
good and valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties have duly executed this Agreement below intending to
be bound hereby.

     

    LESSOR:

    

    
      	
              By:

            	
              /s/
      Lorne Weil

            
	
              Name:

            	
              Lorne
      Weil

            
	
              Title:

            	
              Managing
      Member

            
	
              Date:

            	
              10/19/2009

            

    

    

    

    LESSEE:

    

    
      	
              By:

            	
              /s/
      Steven F. Santo

            
	
              Name:

            	
              Steven
      F. Santo

            
	
              Title:

            	
              CEO

            
	
              Date:

            	
              10/19/2009

            

    

     

    
      
        [***]
Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment
request.

      

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

    

     

    TERMS
AND CONDITIONS

    

    SECTION
I – Operation of the Aircraft During the Lease.

     

    
      	
              1.

            	
              Lessee’s Engagement of Program
      Manager: Lessee confirms that Lessee has engaged Program Manager by
      executing  Program Documents with Program Manager to provide or
      procure certain administrative and aviation support services with respect
      to each aircraft in the Program including, without limitation, scheduling,
      maintenance, insurance, record keeping, flight crew training and
      scheduling, and fuel for or with respect to any aircraft included in the
      Program. Program Manager agrees to provide or procure such services for,
      and Lessee agrees to accept and use only those services provided or
      procured by Program Manager in, the operation of the Aircraft under this
      Agreement.

            

    

     

    
      	
              2.

            	
              Maintenance and Insurance:
      Program Manager shall (i)
      maintain the airworthiness certification of the Aircraft in good standing,
      (ii) arrange for the inspection, maintenance, repair and overhaul of the
      Aircraft in accordance with maintenance programs and standards established
      by the manufacturer of the Aircraft and approved by the FAA, (iii)
      maintain insurance for the Aircraft as required pursuant to Lessee’s
      Program Documents, (iv) keep the Aircraft in good operating condition, and
      (v) maintain the cosmetic appearance of the Aircraft in a similar
      condition, except for ordinary wear and tear, as when delivered to
      Lessee.  Program Manager agrees to maintain the enrollment of the
      specified engines in an FAA approved engine
  program.

            

    

     

    
      	
              3.

            	
              Provision of Pilots: Program
      Manager shall provide or cause to be provided at least one
      Pilot-in-Command and one Second-in-Command, commonly defined as “Flight Crew,”
      professionally trained and qualified pilots to operate each Program
      Aircraft furnished to Lessee.  Lessor, which represents that it
      employs no such pilots, may in its sole discretion and before Lessee’s
      departure with the Aircraft, reject any flight crewmember for any reason
      or no reason; this power is not intended to and shall not be used to
      influence operational control of the
Aircraft.

            

    

     

    
      	
              4.

            	
              Pilot-in-Command: During
      all flights on any Furnished Aircraft, the Pilot-in-Command (as defined in
      FAR 1.1) shall have full authority to take all actions necessary, in the
      sole discretion of the Pilot-in-Command, to (i) provide for the safety of
      such Furnished Aircraft and the passengers, crew or cargo thereon, and
      (ii) enable the safe operation of each such
  flight.

            

    

     

    
      SECTION
II – Covenants, Representations and Warranties of Lessee

    

     

    
      	
              1.

            	
              Aircraft Use. Lessee
      shall utilize the Aircraft at all times in compliance with (a) the
      provisions of the hull and liability insurance then in force and effect
      with respect to the Aircraft, and (b) all federal, state and local laws,
      statutes and regulations, including, without limitation, FAR Part 91,
      Subpart K and any other applicable FAR. Lessee shall use each Program
      Aircraft only for Lessee’s own pleasure or business in the transport of
      Lessee or Lessee’s officials, employees or guests. Lessee agrees not to
      use any Program Aircraft for (a) the purpose of transporting passengers or
      cargo in air commerce for compensation or hire except in accordance with
      the provisions of FAR 91.501 (or any successor thereto or replacement
      thereof applicable to the Program), or (b) any illegal purpose or any
      purpose or use which is prohibited by, or may have the effect of limiting
      or impairing in any manner, the hull or liability insurance coverage then
      in force and effect with respect to the
  Aircraft.

            

    

     

    
      	
              2.

            	
              Responsibility for Compliance
      with FAR. When in Operational Control of a flight, Lessee is
      ultimately responsible for safe operations and for complying with all
      applicable requirements of the FAR, including, without limitation, any FAR
      relating to airworthiness and operations in connection with such flight.
      However, Lessee represents that it delegates certain tasks to Program
      Manager and relies on Program Manager’s expertise in accordance with, and
      subject to, the terms and conditions of the Program Documents. The
      administrative and aviation support delegated tasks include but are not
      limited to: (a) establishment and implementation of program safety
      guidelines; (b) employment, furnishing, or contracting of pilots and other
      crewmembers; (c) training and qualification of pilots and other
      crewmembers and personnel; (d) scheduling and coordination of aircraft and
      crews; (e) maintenance of aircraft; (f) satisfaction of recordkeeping
      requirements; (g) development and use of a program operating manual and
      procedures; and (h) application for and maintenance of management
      specification and other authorizations and approvals.  In each
      such case, Lessee and Program Manager shall be jointly and individually
      responsible for compliance with the
FARs.

            

    

     

    
      	
              3.

            	
              Statutory or Regulatory
      Violations. Lessee shall be liable for all statutory or regulatory
      violations associated with Lessee’s use of any Aircraft during which
      Lessee has Operational Control, provided, however, that Lessee shall not
      be required to indemnify Program Manager for any fines imposed on Program
      Manager solely as a result of the acts or omissions of Program Manager or
      its employees or agents.

            

    

     

    
      	
              4.

            	
              Briefing on Operational
      Control.  Lessee acknowledges that Program Manager has
      briefed Lessee on Lessee’s operational control responsibilities in
      compliance with FAR 91.1013(a) and the Program
      Documents.  Pursuant to FAR Section 91.1009 entitled
      Clarification of Operational Control, (a) Lessee is in operational control
      of a flight when the Lessee: (1) has the rights and is subject to the
      limitations set forth in 91.1003 through 91.1013; (2) has directed that
      the Aircraft carry passengers or property designated by that Lessee; and
      (3) the Aircraft is carrying those passengers or property.  (b)
      Lessee is not in operational control of a flight in the following
      circumstances: (1) the Aircraft is used for a flight for administrative
      purposes such as demonstration, positioning, ferrying, maintenance, or
      crew training, and no passengers or property designated by such Lessee are
      being carried; or (2) the Aircraft being used for the flight is being
      operated under FAR Part 121 or Part
135.

            

    

     

    
      
        [***]
Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment
request.

      

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

    

     

    
      Trip
Sheet Example

    

     

    
      ABC
Corporation

    

    
      Attn:
Smith, Harry

    

    Office:
555-555-2350

    Personal
Cell: 555-555-9250

     

    
      To
contact Avantair Lessee Services about this trip, call (866)
696-7180.

    

     

    Leg
1:   Piaggio P-180

     

     

    
      Depart:

    

    
      Friday,
September 18, 2009

    

    
      3:30 PM
EDT (1530 EDT)

    

    
      Norwood
Memorial, Norwood, MA (OWD)

    

    
      FBO:
FlightLevel Norwood

    

    
      Phone:
(800) 370-8680

    

    
      Fax:
(781) 769-0476

    

     

    
      Arrive:

    

    
      Friday,
September 18, 2009

    

    
      5:08 PM
EDT (1708 EDT)

    

    
      Montgomery
County Airpark Gaithersburg, MD (GAI)

    

    
      FBO:
Montgomery Aviation (GAI)

    

    
      Phone:
(301) 977-5200

    

    
      Fax:
(301) 977-3552

    

     

    
      Luggage /
Cargo:  200 Lbs of Luggage

       

    

    
      Enroute
Flight Time 01:26, Block Time 01:38,  Distance 327.38 NM

    

    
      Passengers: 
4 – Harry Smith, Betty Smith, Matthew  Smith

    

    
      and
Joshua Smith

    

     

    
      By
confirming the details in this Trip Sheet, Lessee acknowledges and agrees that
the aircraft used for this Leg is cross leased from LW Air I LLC and, unless the
Avantair PIC initials here ____ to confirm Avantair’s operational control under
FAR Part 135, Lessee acknowledges that Lessee is operating the Aircraft pursuant
to FAR Part 91K.  Lessee shall incur no additional fees for cross
leasing an aircraft from LW Air I LLC (excluding any fees which may be incurred
pursuant to the Avantair Program Documents).  .

    

     

    
      Please
confirm departure and arrival times, which may vary depending on weather
conditions.

    

    
      Please
verify airport and FBO information is correct.

    

    
      Government
issued photo ID required for all passengers 18 and older.

       

    

    
      International
Trips: Please provide passport details no later than 48 hours before
departure.

    

    Flights
outside of the Preferred Service Area (PSA), may incur additional
charges.

     

    
      Signature___________________________

    

     

    
      
        [***]
Confidential information has been omitted and filed separately with the
Securities and Exchange Commission pursuant to a confidential treatment
request.

      

       

      
        
           

        

        
          4Unassociated Document

    Exhibit
10.19

     

    

    

    ADDENDUM
NUMBER 1

    to

    LW
AIR I LEASE/MANAGEMENT AGREEMENTS

    

    THIS
ADDENDUM NUMBER 1 (“Addendum”) is made this 22nd day of
January, 2010, between Avantair, Inc. (“Lessee”) and LW Air I, LLC
(“Lessor”);

     

    WHEREAS
Lessee and Lessor have previously entered into an Aircraft Lease Agreement dated
October 19, 2009, an Aircraft Management Agreement dated October 19, 2009, and a
Cross Lease Exchange Agreement dated October 19, 2009, with other exhibits (the
“Lease/Management Agreements”;

     

    WHEREAS,
the Lease/Management Agreements pertain to a particular Piaggio P-180 aircraft
with serial number 1181 and U.S. Registration No. N189SL (the
“Aircraft”);

     

    WHEREAS
Lessee and Lessor now desire to amend said Lease/Agreements,

     

    FOR
CONSIDERATION of the mutual promises, agreements and understandings contained in
the Lease/Management Agreements; Lessee and Lessor (“the parties”) agree as
follows:

     

    Lessor
and Lessee acknowledge and agree that when Lessee is in possession of the
Aircraft during the term of the Aircraft Management Agreement, Lessee shall at
all times retain operational control of the Aircraft and possession, command and
control thereof and holds sole authority over initiating, conducting, or
terminating a flight.  While operating the Aircraft, Lessee also
agrees that they shall comply with the rules and regulations of Part 135 of the
FAR’s, regardless if the Aircraft is being operated pursuant to FAR Part 91K by
a fractional co-owner in Lessee’s fractional aircraft program.

     

    Further,
Lessee acknowledges and agrees that they have fully reviewed OpSpec A008 and
shall comply with all provisions of this document while operating the
Aircraft.  Further, both parties agree that Lessor shall have no right
to reject any flight crewmember for any reason or no reason so that it may
violate any provisions of Part 135 of the FAR’s and OpSpec A008.

     

    To the
extent that there is any inconsistency with the description of operational
control in any of the documents that make up the Lease/Management Agreements,
this Addendum shall prevail.

     

    Except as
provided in this Addendum, all terms and conditions of the Lease/Management
Agreement are hereby ratified and confirmed by the parties.

     

    IN
WITNESS WHEREOF, the parties have executed this Addendum of the Lease/Management
Agreements on the date first above written.

     

    
      	
              LW
      Air I, LLC

            	 	
              Avantair,
      Inc.

            
	 
      	 
      	 	 
      	 
      
	
              By:

            	
              /s/ Lorne Weil

            	 	
              By:

            	
              /s/ Steven F. Santo

            
	
              Title:

            	 
      	 	
              Title:

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