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EXHIBIT 10.25
DRY LEASE AGREEMENT
This Agreement, made and entered into this First day of April, 1997, by
and between Virtual Village Aircraft, Inc., a corporation incorporated under
the laws of the State of Delaware, with principal offices at 500 North Central
Expressway, Suite 202, Plano, Texas, 75074, (hereinafter referred to as
"LESSOR"), and Daisytek International Corporation, a corporation incorporated
under the laws of the State of Delaware, with principal offices at 500 North
Central Expressway, Suite 500, Plano, Texas, 75074, (hereinafter referred to as
"LESSEE");
W I T N E S S E T H , that
WHEREAS, LESSOR is the registered OWNER of that certain civil AIRCRAFT
bearing the United States Registration Number N129DH ("the AIRCRAFT" or
"AIRCRAFT") ; and of the type Pilatus PC-12 ;
WHEREAS, LESSOR and LESSEE desire to lease said AIRCRAFT on a "DRY LEASE"
basis defined in Section 91.54 of the Federal Aviation Regulations [FAR].
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NOW THEREFORE, LESSOR AND LESSEE, declaring their intention to enter into
and be bound by this DRY LEASE AGREEMENT, and for the good and valuable
consideration set forth below, hereby covenant and agree as follows:
1. For the sum of One hundred seventy two thousand eight hundred
dollars ($172,800.00) LESSOR agrees to lease the AIRCRAFT to LESSEE
for the period of Twelve (12) calendar months. LESSEE shall pay
LESSOR the above stated amount in twelve equal monthly installments,
Fourteen thousand four hundred dollars ($14,400.00) payable on the
First day of each month.
The AIRCRAFT shall be delivered to LESSEE at McKinney
Municipal Airport in McKinney, Texas on April 01, 1997, at which
time LESSEE shall inspect the AIRCRAFT to the extent deemed
necessary. LESSEE shall have five (5) flight hours following
delivery of the AIRCRAFT in which to notify LESSOR in writing of
any defects in the AIRCRAFT or its equipment or accessories. If,
at the end of such period, LESSOR has not received such
notification, it shall be conclusively presumed between the
parties that LESSEE has fully inspected the AIRCRAFT having
knowledge that it is in good condition and repair and that LESSEE
is satisfied with and has accepted the AIRCRAFT in such condition and
repair.
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2. This Lease shall commence on April 01, 1997 and continue for
one year after said date. Thereafter, this Lease shall be
automatically renewed on a month to month basis, unless sooner
terminated by either party as hereinafter provided. Either party
may at any time terminate this Lease upon thirty (30) days written
notice to the other party, delivered personally or by certified
mail, return receipt requested, at the address for said party as set
forth above. Upon any termination of this Lease, the parties shall
equitably adjust any prepaid items or amounts owing as of such date
of termination.
3. This Lease shall entitle LESSEE to an aggregate of Three
Hundred (300) flight hours during the initial Twelve (12) month
term. LESSEE shall have the right to use of the AIRCRAFT in excess
of said Three Hundred (300) flight hours, provided, however, that
LESSEE and LESSOR shall mutually agree upon an equitable pro rata
allocation of all AIRCRAFT costs relating to such excess usage.
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4. Neither LESSEE nor LESSOR will make the AIRCRAFT available
for hire within the meaning of the Federal Aviation Regulations.
The AIRCRAFT is to be operated strictly in accordance with 14 C.F.R.
Part 91.
5. At all times during the term of this Lease, LESSEE and LESSOR
shall cause to be carried and maintained, at their own respective
cost and expense, the policies and types of insurance described on
Schedule I attached hereto.
6. LESSEE may operate the AIRCRAFT only for the purposes and
within the geographical limits set forth in the insurance policy or
policies obtained in compliance with Paragraph Five of this Lease.
The AIRCRAFT shall be operated at all times in accordance with the
flight manual and all manufacturer's suggested operating procedures.
Furthermore, LESSEE shall not use the AIRCRAFT in violation of any
foreign, federal, state, territorial, or municipal law or regulation
and shall be solely responsible for any fines, penalties, or
forfeitures occasioned by any violation by LESSEE. If such fines or
penalties are imposed on LESSOR and paid by LESSOR, LESSEE shall
reimburse LESSOR for the amount thereof within thirty (30) days of
receipt by LESSEE of written demand from LESSOR. LESSEE will not
base the AIRCRAFT, or permit it to be based, outside the limits of
the United States of America, without the written consent of LESSOR.
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The AIRCRAFT shall be flown only by certified and qualified
pilots who meet all qualifications established by the policies of
insurance described in Paragraph Five of this Lease. The AIRCRAFT
shall be maintained only by certified and qualified mechanics. In
the event the insurance on the AIRCRAFT would be invalidated
because LESSEE is unable to obtain certified and qualified pilots
and mechanics, LESSEE shall not operate the AIRCRAFT until such
time as certified and qualified pilots and mechanics are obtained
and insurance on the AIRCRAFT is made valid. LESSEE will not
directly or indirectly create, incur, assume or suffer to exist
any lien on or with respect to the AIRCRAFT, except any lien
created, incurred, assured or permitted by LESSOR. LESSEE will
promptly, at its own expense, take such action as may be necessary
to discharge any lien not excepted above if the same shall arise
at any time.
7. LESSEE agrees to permit LESSOR or any authorized agent to
inspect the AIRCRAFT at any reasonable time and to furnish any
information in respect to the AIRCRAFT and its use that LESSOR may
reasonably request.
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8. Except in accordance with other written agreements entered
into subsequent to the date of this Lease between LESSEE and LESSOR
regarding maintenance of the AIRCRAFT, LESSEE shall not have the
right to alter, modify, or make additions or improvements to the
AIRCRAFT without the written permission of the LESSOR. All such
alterations, modifications, additions, and improvements as are so
made shall become the property of LESSOR and shall be subject to all
of the terms of this Lease.
9. The registration of and title to the AIRCRAFT shall be in the
name of the LESSOR, and the AIRCRAFT, at all times during the term
of this Lease or any extension, shall bear United States of America
registration markings. All responsibility and obligations in regard
to the operation of the Aircraft as above owned, registered, and
marked shall be borne by LESSEE during the term of this Lease.
10. LESSOR shall pay or cause to be paid all taxes incurred by
reason of ownership of the AIRCRAFT during the term of this Lease,
including personal property taxes. LESSEE shall pay all taxes
associated with LESSEE'S use of the AIRCRAFT on LESSEE'S own
business, including landing fees, fuel taxes, and any other taxes or
fees which may be assessed against a specific flight by LESSEE.
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11. LESSEE shall not assign this Lease or any interest in the
AIRCRAFT, or sublet the AIRCRAFT, without prior written consent of
LESSOR. Subject to the foregoing, this Lease inures to the benefit
of, and is binding on, the heirs, legal representatives, successors,
and assigns of the parties.
12. LESSEE shall immediately notify LESSOR of each accident
involving the AIRCRAFT, which notification shall specify the time,
place, and nature of the accident or damage, the names and addresses
of parties involved, persons injured, witnesses, and owners of
properties damaged, and such other information as may be known.
LESSEE shall advise LESSOR of all correspondence, papers, notices,
and documents whatsoever received by LESSEE in connection with any
claim or demand involving or relating to the AIRCRAFT or its
operation, and shall aid in any investigation instituted by LESSOR
and in the recovery of damages from third persons liable therefor.
13. On the termination of this Lease by expiration or otherwise,
LESSEE shall return the AIRCRAFT to LESSOR at McKinney Municipal
Airport, in McKinney, Texas, in as good operating
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condition and appearance as when received, ordinary wear, tear
and deterioration excepted, and shall indemnify LESSOR against any
claim for loss or damage occurring prior to the actual physical
delivery of the AIRCRAFT to LESSOR.
14. This Lease constitutes the entire understanding between the
parties, and any change or modification must be in writing and
signed by both parties.
15. This Lease is entered into under, and is to be construed in
accordance with, the laws of the State of Texas.
16. The headings in this Agreement are intended solely for the
convenience of reference and shall be given no effect in the
construction or interpretation of the Agreement.
17. If any provision of this Agreement is deemed or held to be
illegal, invalid, or unenforceable, this Agreement shall be
considered divisible and inoperative as to such provision to the
extent it is deemed to be illegal, invalid or unenforceable, and all
other respects this Agreement shall remain in full force and effect;
provided, however, that if any provision of this Agreement is deemed
or held to be illegal, invalid or unenforceable there shall
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be added hereto automatically a provision as similar as possible to
such illegal, invalid or unenforceable provision which would be
legal, valid and enforceable. Further, should any provision
contained in this Agreement ever be reformed or rewritten by an
judicial body of competent jurisdiction, such provision as so
reformed or rewritten shall be binding upon all parties hereto.
TRUTH IN LEASING STATEMENT
The AIRCRAFT, a Pilatus PC-12, manufacture's serial number 140, currently
registered with the Federal Aviation Administration as N129DH, has been
maintained and inspected under FAR Part 91 during the 12 month period preceding
the date of this Lease.
The AIRCRAFT will be maintained and inspected under FAR Part 91 for
operations to be conducted under this Lease. During the duration of this
Lease, Daisytek International Corporation, with principal offices at 500 North
Central Expressway, Suite 500, Plano, Texas, 75074, is considered responsible
for Operational Control of the AIRCRAFT under this Lease.
An explanation of factors bearing on Operational Control and pertinent
Federal Aviation Regulations can be obtained from the nearest FAA Flight
Standards District Office.
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The "instructions" for compliance with Truth In Leasing Requirements"
attached hereto are incorporated herein by reference.
I, The Undersigned Mark C. Layton, as President of Daisytek International
Corporation, with principal offices at 500 North Central Expressway, Suite 500,
Plano, Texas, 75074, certify that I am responsible for operational control of
the AIRCRAFT and that I understand my responsibilities for compliance with
applicable Federal Aviation Regulations.
IN WITNESS WHEREOF, the parties hereto have executed this instrument as of the
day and year above written.
Virtual Village Aircraft, Inc.
By: /s/ JOHN W. WARD
John W. Ward
Vice President
Daisytek International Corporation
By: /s/ MARK C. LAYTON
Mark C. Layton
President
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INSTRUCTIONS FOR COMPLIANCE WITH
TRUTH IN LEASING REQUIREMENTS
1. Mail a copy of the Lease agreement to the following address via certified
mail, return receipt requested, immediately upon execution of the
agreement (14 C.F.R. requires that the copy be sent within twenty-four
hours after it is signed):
Federal Aviation Administration
Aircraft Registration Branch
ATTN: Technical Section
P.O. Box 25724
Oklahoma City, Oklahoma 73125
2. Telephone the nearest Flight Standards District Office at least
forty-eight hours prior to the first flight under this Lease agreement.
3. Carry a copy of the Lease agreement in the AIRCRAFT at all times.
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