FIXED BASE OPERATOR USE AND OPERATIONS AGREEMENT THIS AGREEMENT is made this _______ day of ________________, 20___,

between the _____________Airport Authority, a municipal corporation, (the Authority), and Aero Sport, Inc. (the Lessee).

RECITALS A. Authority owns and operates the (the Airport), located in _____________County, Florida. Operator desires to operator a Fixed Base Operator facility at the

B.

COVENANTS NOW, THEREFORE, in consideration of the fees, agreements and covenant set forth in this Agreement, the parties agree as follows:

ARTICLE I TERM OF AGREEMENT A. PRIMARY TERM. The term of this Agreement shall be for the period commencing _________________________ and ending ________________________. Provided Operator is in compliance with all the B. OPTION TERM. terms and conditions of this Agreement, Operator shall have the option to renew this Agreement upon all the same terms and conditions except for new rentals and fees for two (2) additional terms of Ten (10) years each. This option shall be exercised by written notice to Authority not later than one hundred twenty (120) days prior to expiration of the existing term. C. HOLDING OVER. In the event operator shall continue to conduct business as a Fixed Base Operator at the airport beyond the term of the agreement, after authority gives written notice to vacate, such holding over shall not constitute a renewal of this agreement, but shall be a month-to-month tenancy only. The amount of rent and fees paid during this hold over period shall equal one and half (1 ) times the normal monthly rent and fees chargeable at the termination of the agreement.

ARTICLE II FEES In addition to any other fees, Operator shall A. FUEL FLOWAGE FEES. pay a fuel flowage fee, as established by Authority from time to time for each gallon of fuel sold by Operator. The aforesaid flowage fee is presently five cents ($.05) per gallon on all fuel sold by Operator. No fuel flowage fee shall be paid on fuel sales to military aircraft and carriers under contract to Authority and any other carriers who pay landing fees to Authority. The fee herein specified shall be due and payable on the 20th day of each month for the preceding calendar month of operation to Authority as herein provided, and the Authority shall have the right and privilege on call to inspect and audit the bills, receipts, and records pertaining to the purchase of said petroleum products for the purposes of verifying the correctness of the fee payments tendered by Operator. Operator agrees to file with the Authority on forms prescribed by Authority monthly reports showing the number of gallons of fuel so sold by Operator in order that the money due as fees may be shown. This report shall be filed no later than the twentieth (20th) day of the month following the sale of said fuel along with the payment of this fee. B. FUEL FARM RENTAL. In addition to any other fees, Operator shall pay an annual rental equal to five ($.05) cents per gallon storage capacity of fuel farm tanks. Authority shall reimburse Operator for the reasonable cost of repairs to the fuel farm, excluding normal maintenance. This shall be payable in twelve (12) equal monthly installments. The current usable storage capacity is indicated on Exhibit A. C. PERCENTAGE RENTALS. For purposes of this Agreement fiscal year shall be the twelve (12) months beginning January 1, and ending December 31. Operator shall pay to the Authority each year a sum equal to one percent (1%) of applicable Gross Receipts in excess of One Million Three Hundred and Ninety Thousand Dollars ($1,390,000.00), the gross receipts base, in each fiscal year or a pro rata portion of One Million Three Hundred and Ninety Thousand Dollars ($1,390,000.00) in any fiscal year consisting of less than twelve (12 months). The term gross receipts shall include the following: 1. The aggregate amount of all sales made and services performed for cash, credit or otherwise, of every kind, name and nature, regardless of when paid for; plus 2. The aggregate amount of all exchange of goods, wares, merchandise and services for like property of services, at the selling price thereof, as if the same had been sold for cash or the reasonable value thereof, whichever is the greater. The following items shall be EXCLUDED from Gross Receipts: (a) (b) Sales tax collected that are included in such gross income; Fuel sales;

(c) (d)

Rental income; Aircraft sales.

D. AIRCRAFT SALES PERCENTAGE FEE. In addition to any other fees, Operator shall pay a fee equal to one (1%) percent of Operators gross profit from the sale of any aircraft. E. LANDING FEES. In addition to any other fees, Operator shall pay to the Authority sixty-six (66%) of all revenue received from the imposition of landing fees from all commercial aircraft operators operating under Federal Aviation Regulation Part 121 or Federal Aviation Regulation Part 135 and not under direct contract with Authority when said commercial aircraft operators are utilizing the facilities of the St. Augustine St. Johns County Airport. Operator shall collect the above-stated Landing Fees in accordance with any Ordinance which Authority may adopt for the purpose of setting Landing Fee rates and charges at the St. Augustine St. Johns County Airport. Operator shall share the responsibility of collection non-contract Landing Fees with other Fixed Base Operators located on the St. Augustine St. Johns County Airport. The determination as to who collects these fees is as follows: 1. Each fixed Base Operator will be responsible for the collection of Landing Fees from any commercial aircraft operator utilizing the Operators facilities and/or parked on Tenants demised areas. 2. Any commercial aircraft operator parking on any Public Aircraft Ramp area shall be charged a Landing Fee by the Fixed Base Operator which is providing fuel or other services to that particular aircraft operator. 3. If the commercial aircraft operator does not require fuel or services while parked on the Public Aircraft Ramp, then the first arriving Fixed Base Operator will be required to collect any applicable Landing Fees. All landing fees collected during a given calendar month will be reported by the Operator on the monthly Fuel Flowage Report. Authority shall supply monthly reporting forms for this purpose. Authority shall supply an up-to-date list from time to time showing all commercial aircraft operators who are covered under direct contracts with Authority. Authority reserves the right to contract directly with any commercial aircraft operator and collect any and all landing fees from such operator directly. In such instances, Operator shall not receive any share of the landing fees.

F. RENT AND FEE INCREASES. The fuel farm rental, percentage rentals and the gross receipts base amount are based upon the cost of living for the month of October, 2001 as reflected in the Consumer Price Index for all items for the United States city average (CPI-U) as determined by the United States Department of Labor, Bureau of Labor Statistics, based on all items for the year 2000-2002=100, which index figure for October, 2000 was 137.8. It is agreed by the parties that the fuel farm rental, percentage rentals, and gross receipts base amount shall be adjusted in the following manner at the beginning of each option term of this Agreement on the basis of that Consumer Price Index, or, if there shall be no such Consumer Price Index, then by the successor of the most nearly comparable successor index (approximately adjusted to the October, 2001 base): (i) the basic index figure for this purpose shall be the index figure for October, 2001, that is to say 137.8. If the corresponding index figure for October, 2006, and for October of each tenth anniversary thereafter during the term and any renewal of this Lease, shall exceed the basic index figure of October 2001, then the fuel farm rental, percentage rentals, and gross receipts base amount for each fiscal year thereafter, until refigured, shall be increased to an amount arrived at by multiplying the fuel farm rental, percentage rentals, and gross receipts base amount then applicable by a fraction, of which the numerator shall be the index figure for October of the year recomputation, and the denominator shall be 137.8. (ii) notwithstanding any possible provision to the contrary contained in this Agreement, it is agreed by the parties that the fuel farm rental, percentage rentals, and gross receipts base amount for any fiscal year during the term, shall never be less than an annual fuel farm rental of five cents ($.05) per gallon storage capacity, a percentage rental of one (1%) percent of applicable gross receipts in excess of the gross receipts base, and a gross receipts base of $1,390,000.00. Fixed fees shall be paid G. TIME AND PLACE OF PAYMENT. monthly on the twentieth (20th) day of each month. Percentage and flowage fees shall be due and payable on the twentieth (20th) day of each month for the preceding calendar month of operation. All payments are to be made at the office of the Airport Director or such other place Authority may direct Operator in writing. H. REPORTS. With the payment of monthly percentage fees by the th twentieth (20 ) day of the month as herein provided, Operator shall submit to Authority a detailed statement showing gross receipts from the operations of the business hereunder for the preceding calendar month. These reports shall show such reasonable detail and breakdown as may be required by Authority, on forms provided by Authority. Within ninety (90) days after the end of each fiscal year during the term of this Lease or any extension thereof, Operator shall submit to Authority a detailed statement of gross receipts reflecting applicable gross receipts for the preceding year of operation. Such statement shall be reviewed by a Certified Public Accountant and shall be accompanied by Operators payment covering any deficiency between payment made during the previous year of operation and payments due for such year of operation as set out above. In the event that Operators payment to Authority for the previous year of operation exceeds the amount of payment required hereunder, Authority shall reimburse

Operator with an amount equal to the difference between the sum required and the sum paid. Operator shall keep I. BOOKS AND RECORDS OF OPERATOR. and maintain complete and adequate books and records for the purpose of determining the gross receipt, and defined hereinabove, from the Fixed Base Operations for the current and immediately prior three years and shall make such books and records available for inspection by Authority or its authorized representatives at any and all reasonable house and times. J. DELINQUENT FEES. There shall e added to all sums due Authority and unpaid, an interest charge of one and one-half (1 %) percent of the principal sum for each full calendar month of delinquency, computed as simple interest. No interest shall be charged upon that portion of any debt which, in good faith, is in dispute. No interest shall be charged upon any account until payment is thirty (30) days overdue but such interest, when assessed thereafter, shall be computed from the due date. K. AUDIT. Authority shall have the right during each calendar year to authorize an audit of Operators records pertaining to its operation on the Airport. Such audits shall be undertaken by the Authority staff or a firm of certified public accountants, satisfactory to Authority. The cost of such audit shall be paid by Authority, unless the results of such audit reveal a discrepancy of more than three (3%) percent between the gross receipts reported in accordance with this Article V and the gross receipts as determined by audit for any fiscal year or pro rata fiscal year reported. In case of such discrepancy, the full cost of the audit shall be paid by Operator. Any additional auditing expense resulting from Operators inability or refusal to provide records as required by the auditor shall be paid by Operator. The Operator shall forthwith pay to the Authority the full amount of rental and fees due based upon the results of the audit if a discrepancy exists.

ARTICLE III PRIVILEGES A. REQUIRED USES. The purpose of this Agreement is to grant to Operator the right and privilege to conduct business as a Fixed Base Operator at the Airport. For this right, Operator shall provide the following described minimum services to the users of the airport, provided, however, the right and privilege to conduct a Fixed Base Operation hereby granted shall exist only so long as the character of the facilities operated or services furnished by the Operator shall be consistent with the high quality of facilities and services provided by other Fixed Base Operators of Authority and in accordance with minimum standards required by Authority: 1. a. Fuel, Oil and Transient Aircraft Services. Aviation fuel and oil;

b. Capabilities to perform minor repairs on a standby basis during daylight hours that the maintenance shop is closed; c. 2. Proper fuel dispensing equipment to service aircraft; Line Service and Pilot/Passenger Facilities.

a. Uniformed, qualified line personnel on full-time duty, seven (7) days a week, daylight hours; b. Suitable hard surface aircraft parking and tie-down facilities as presently or may be in the future constructed by Authority; c. Adequate ground equipment, i.e., groundpower units, aircraft tug, portable compressed air, engine heater and the like; d. Adequate waiting lounge, pilot briefing room, rest rooms, telephone facilities, and the like; e. 3. Adequate facilities for washing and cleaning aircraft. Airframe and Powerplant Maintenance.

a. During normal business hours, aircraft and engine maintenance by qualified licensed mechanics; b. Provided, however, Operator shall have the right to subcontract such services upon written approval by the Authority which approval shall not be unreasonable withheld. At all times the aircraft shop shall be operated and maintained in accordance with standards set forth for an FAA approved repair station as outlined in FAA Regulation Part 145, as amended (or a superseding publication), or as an alternative, Operator shall employ a full-time FAA authorized inspector. B. PERMITTED USES. The following activities or services are not required, but may be offered by Operator: 1. 2. 3. 4. Aerial ambulance; Aerial survey, photography and mapping; Aircraft charter and air taxi; Aircraft painting;

5. 6. 7. 8. 9. 10. 11. 12. 13.

Aircraft rental; Aircraft salvage; Aircraft storage; Avionics repair; Flight training; Crop spraying and agricultural aviation; Instrument repair; Manufacturer of general aviation aircraft components and accessories; Propeller repair;

14. Rental of passenger automobiles. Said vehicle may be rented only to customers of Operators aviation services. Operator shall not be permitted to advertise the Rental Car Concession anywhere on Airport property, except at the main desk of Operators operations area. Operator shall not sell automobiles on Airport property. 15. Sale of general aviation pilot supplies (maps, manuals, pilot equipment and training aids); 16. Aircraft sales.

Operator shall not operate in any other C. PROHIBITED USES. manner than set out in Paragraphs A and B of this Article. Without limiting the generality of such prohibition, the following uses are specifically prohibited unless prior written consent of Authority is secured: 1. 2. 3. Sale of alcoholic beverages; Maintenance of sale of non-aviation products or services; Any use prohibited by law or regulation.

D. INGRESS AND EGRESS. Upon the paying of fees and performing the covenants of this Agreement, Operator shall have the right to use the landing field, runways, taxi-ways, public ramps, commercial and non-commercial roadways and navigational aids and facilities at the Airport and the airspace immediately above it for aviation purposes including testing, takeoffs, flights landings, taxiing, towing, fueling by mobile truck tanks, de-icing or aircraft, loading and unloading in an emergency, for

removing damaged or stalled aircraft when called from portions of the Airport. Operator shall not interfere with the rights and privileges of other persons or firms using said facilities and shall be subject to such weight and type use restrictions as Authority deems necessary.

ARTICLE IV OBLIGATIONS OF OPERATOR A. SIGNS. No sign shall be erected or maintained by Operator except in compliance with the Authoritys requirements for location and use of signs on Airport property. Prior to erection, Operator must obtain written approval from Authority. B. NON-DISCRIMINATION. The Operator for itself, its personal representatives, successors in interest, and assigns, as a part of the consideration hereof, does hereby covenant and agree that (1) no person on the grounds of race, creed, color, national origin, sex, age or handicap shall be excluded from participation in, denied the benefits of or be otherwise subjected to discrimination in the use of said facilities, (2) that in the construction of any improvements on, over or under such land, the furnishing of services thereon, no person on the grounds of race, creed, color, national origin, sex, age, or handicap shall be excluded from participation in, denied the benefits of or otherwise be subjected to discrimination, (3) that the Operator shall use the Leased Premises in compliance with all other requirements imposed by or pursuant to Title 49, Code of Federal Regulations, Department of Transportation, Subtitle A, Office of the Secretary, Part 21, Non-Discrimination in Federally-assisted programs of the Department of Transportation Effectuation of Title VI of the Civil Rights Act of 1964 and as said Regulations may be amended. The Operator agrees to furnish service on a fair, equal, and not unjustly discriminatory basis to all users thereof and to charge fair, reasonable, and not unjustly discriminatory prices for each unit or service, provided that the Operator may be allowed to make reasonable and non-discriminatory discounts, rebates or other similar types of price reductions to volume purchasers. C. CARE OF PETROLEUM PRODUCTS AND OTHER MATERAL BY LESSEE. Lessee shall handle, use, store and dispose of petroleum products, and all other materials (including but not limited to hazardous materials) owned or used by it on the Airport in accordance with all applicable federal, state, local and Authority statutes, regulations, rules and ordinances. No waste or disposable materials shall be released on the ground or in the storm sewer. Should such materials be spilled or escape from storage or in any way contaminate the Airport or property adjacent to the Airport through activities of the Lessee, the Lessee shall be responsible for the clean up, containment and otherwise abatement of such contamination at Lessees sole cost and expense. Further, Lessee shall notify the Authority and appropriate governmental agency of such occurrence immediately. Should the Lessee fail to do so, the Authority may take any

reasonable and appropriate action in the Lessees stead. The cost of such remedial action by the Authority shall be paid by the Lessee. D. COMPLIANCE WITH LAWS, RULES AND REGULATIONS. Lessee shall, at its sole expense, observe and comply with the statutes, rules and regulations of all governmental authorities applicable to the conduct of Lessees business and in addition, those rules, ordinances, and regulations of the Authority not inconsistent with the provisions of this Agreement. Any penalties and costs levied as a result of the Lessees breach of any of the above shall be borne by the Lessee. E. INDEMNITY AND INSURANCE BY OPERATOR. Operator further covenants and agrees that Operator shall indemnify and save forever harmless the Authority from any and all claims for damages of any kind or nature which may hereafter be made against Authority on account of any personal injuries (including wrongful death) or property damage resulting from the operations under this Agreement and for this purpose Operator shall procure and maintain in effect for the term of this Agreement, with insurance carriers acceptable to Authority, Workers Compensation Insurance as required by the statutes of the State of Florida, or adequate Employees Liability Insurance; Public Liability; Property Damage; and Products Liability Insurance covering all of Operators activities and the Leased Premises at the Airport. The policy limits of the Public Liability Insurance shall be not less than Five Million Dollars ($5,000,000.00) for any one accident involving injury (including wrongful death) to more than one person, with Property Damage Insurance of not less than Five Million Dollars ($5,000,000.00) for any one accident. Coverage is to be written on the broadest liability form including but not limited to products liability, hangar keepers liability, blanket contractual, independent contractors and aviation non-ownership. All policies shall include the Authority as an additional insured as its interest appear. The Lessee shall maintain such insurance with insurance underwriters authorized to do business in the State of Florida satisfactory to the Authority. Operator shall furnish Authority with a Certificate of Insurance from the Operators carrier indicating that there is such insurance coverage as hereinbefore provided, and if requested by the Authority, shall submit to the Authority, a true copy of the above insurance coverage. Said Certificate of Insurance shall provide that the policy or policies cannot be cancelled or materially modified except upon thirty (30) days advance written notice by registered or certified mail to the Authority. The dollar amount of liability insurance coverage shall be reviewed on a periodic basis and modified, if necessary, based upon escalating costs and limits for the uses as provided in this Agreement as compared to similar airports. F. TIE-DOWN PRIVILEGES. Operator shall rent tie-down spaces on a fair and equal manner which shall include a current waiting list, developed on a first come/first served basis, and shall offer leased arrangements based on this list.

ARTICLE V OBLIGATIONS OF AUTHORITY A. OPERATION AS A PUBLIC AIRPORT. Authority covenants and agrees that at all times it will operate and maintain the Airport as a public airport consistent with and pursuant to the Sponsors Assurances given by Authority to the United States Government under the Federal Airport Act.

ARTICLE VI TERMINATION OF AGREEMENT, ASSIGNMENT AND TRANSFERS A. TERMINATION. This Agreement shall terminate without action by either party at the end of the initial term or any renewal term. B. TERMINATION BY OPERATOR. Operator may terminate this agreement after the happening of one or more of the following events: 1. The permanent abandonment of the Airport;

2. The lawful assumption by the United States Government, or any authorized agency thereof, of the operation, control or use of the Airport, or any substantial part or parts thereof, in such a manner as substantially to restrict Operator for a period of at least ninety (90) days from operating thereon; 3. The default by Authority in the performance of any covenant or agreement herein required to be performed by Authority and the failure of Authority to remedy such default for a period of sixty (60) days after receipt from Operator of written notice to remedy same. Operator C. EXERCISING OPERATORS RIGHT OF TERMINATION. may exercise such right of termination by written notice to Authority at any time after the occurrence of any such events and the Agreement shall terminate as of the date notice is received by the Authority. D. TERMINATION BY AUTHORITY. Agreement in the event Operator shall: Authority may terminate this

1. Be in arrears in the payment of the whole or any part of the rent or other payments required for a period of thirty (30) days after the time such payments become due; 2. 3. Make a general assignment for creditors benefit; File a voluntary or involuntary petition in bankruptcy;

4. Discontinue any of the commercial aviation operations as outlined in Article I, Section A; 5. Default in the performance of any of the covenants, agreements and conditions required herein (except rental payments) to be kept and performed by Operator, and such default continues for a period of thirty (30) days after receipt of written notice from Authority of said default; 6. Appointment of Receiver for Operator;

Violation of Authority rules and regulations not inconsistent with the provisions of this lease and such default continues for a period of thirty (30) days after receipt of written notice from Authority of said default. E. EXERCISING AUTHORITYS RIGHT OF TERMINATION. The Authority may exercise such rights of termination by written notice to the Lessee and this Agreement shall terminate as of that date. Authority shall have the right to collect such damages as may be permitted by law arising out of such termination. Failure of Authority to declare this Agreement terminated upon the default of Lessee for any of the reasons set out above shall not operate to waive the right of Authority to terminate this Agreement by reason of any subsequent violation of the terms. Operator may, with the prior written consent of F. ASSIGNMENT. Authority, assign this Agreement; but in such event, Operator shall remain liable to Authority for the remainder of the term of the Agreement to pay to Authority any portion of the fees not paid by the assignee when due. The assignee shall not assign the Agreement except with the prior written consent of the Authority, and any assignment by the Operator shall contain a provision to this effect. Further, any assignee of the Operator shall be bound by the terms and conditions of this Agreement.

ARTICLE VII GENERAL PROVISIONS A. AUTHORITYS RESERVED RIGHTS.

1. Authority at its sole discretion reserves the right to further develop or improve the aircraft operating area of the Airport as it sees fit and to take any action it considers necessary to protect the aerial approaches of the Airport against obstructions, together with the right to prevent Operator from erecting or permitting to be erected, any building or other structure on the Airport which, in the opinion of the Authority would limit the usefulness of the Airport or constitute a hazard to aircraft. This Agreement shall be subordinate to the provisions of any existing or future agreement between Authority and the United States, relative to the operation or maintenance of the Airport, the terms and execution of which have been or may be required as a condition

precedent to the expenditure or reimbursement to Authority for federal funds for the development of the Airport. B. NON-INTERFERENCE WITH OPERATION OF AIRPORT. Operator by accepting this Agreement expressly agrees for itself, its successors and assigns that it will not in any manner interfere with the landing and taking off of aircraft at the Airport or otherwise constitute a hazard. In the event this covenant is breached, the Authority reserves the right to cause the abatement of such interference at the expense of Operator. Authority shall maintain and keep in repair the landing area of the Airport, and shall have the right to direct and control all activities of the Operator in this regard. C. NON-EXCLUSIVE RIGHT. Nothing contained in this Agreement shall be construed to grant or authorize the granting of an exclusive right to provide aeronautical services to the public as prohibited by Section 308 (a) of the Federal Aviation Act of 1958, as amended, and the Authority reserves the right to grant to others the privilege and right of conducting any one or all activity of an aeronautical nature. If action is brought to enforce the provisions D. ATTORNEYS FEES. of this Agreement, the prevailing party shall be entitled to recover reasonable attorneys fees. The paragraph headings are for E. PARAGRAPH HEADINGS. convenience in reference and are not intended to define or limit the scope of any provision of this Agreement. F. NOTICE. Whenever any notice is required by this Agreement to be made, given or transmitted to the parties, such notice shall be served by Certified or Registered Mail with return receipt, addressed to: Executive Director St. Augustine St. Johns County Airport Authority 4796 U. S. 1 North St. Augustine, Florida 32095 And notices, consents and approvals to Lessee addressed to: President Aero Sport, Inc. 4900 U. S. 1 North St. Augustine, Florida 32095 Or to such other addresses as the parties may designate to each other in writing. G. FLORIDA LAW. This Agreement shall be interpreted in accordance with the laws of the State of Florida.

H. SUCCESSORS AND ASSIGNS. All of the terms, covenants and agreements herein contained shall be binding upon and shall inure to the benefit of the successors and assigns of the parties.

ARTICLE VIII DEFAULT UNDER LEASE AGREEMENTS Operator has in existence with the Authority certain other Agreements. Any breach by Operator of such other Agreements shall constitute a material breach of this Agreement.

The parties sign this Agreement this _______ day of ________________, 20___. OPERATOR Aero Sport, Inc. AUTHORITY St. Augustine St. Johns County Airport Authority

By: ______________________________ President Attest: __________________________________

By: __________________________ Executive Director Attest: ______________________________