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EXHIBIT 10.22
DOOR-TO-DOOR OPERATOR
COMMERCIAL GROUND TRANSPORTATION OPERATING PERMIT
JOHN WAYNE AIRPORT
ORANGE COUNTY
Permittee is hereby authorized and permitted by the County or Orange,
hereinafter referred to as "County", acting by and through its Airport Director,
hereinafter referred to as "Director", to operate its business or a phase
thereof at the John Wayne Airport, hereinafter referred to as "Airport", for the
following purposes only and subject to the terms and conditions hereinafter set
forth.
The following specific terms and conditions are hereby mutually agreed to
between County and PREFERRED TRANSPORTATION, INC. DBA SUPERSHUTTLE (hereinafter
referred to as "Permittee"):
1. Use Purpose Defined
Provide Door-to-Door ground transportation service to airline passengers whose
flights are arriving at or departing from the John Wayne Airport. Passenger
drop-offs, in conjunction with the providing of such services, may be made at
the terminal curbs on the Upper Level of the Terminal roadways, and passenger
pick-ups may be made at the loading zones on the Lower Level of the Terminal
roadways, and only by authorized vehicles bearing a valid identification sticker
and an automatic vehicle identification device (transponder) issued by Director.
2. Term of Permit
This permit shall become effective on 7-7, 1997, and shall continue in forms on
a thirty (30) day, month-to-month basis, until revoked or mutually cancelled as
hereinafter provided.
3. Authorized Vehicles
A. Permittee shall report to Director, on forms provided for that
purpose, the California State Vehicle Identification Number,
License plate number, company identification number, if any, and
vehicle type for each of the Permittee's vehicles used for its
operations at Airport.
B. All of Permittee's vehicles operated at the Airport shall possess
identical color schemes and marking, so as to be readily
identifiable as belonging to Permittee; shall display the name of
Permittee, or its "DBA" on the rear and sides of each vehicle, in
a type style and size so as to be
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readily identifiable; shall possess Permittee's company
identification sticker and automatic vehicle identification
device, permanently affixed as instructed by Director.
C. Upon receipt of the requisite information and performance of all
other conditions precedent contained in this Permit Director may
issue identification stickers and automatic identification devices
to be attached to each authorized vehicle.
4. Consideration for Permit
As consideration for this Permit, Permittee agrees:
A. To pay County, a monthly fee determined by the number of monthly
trips conducted by Permittee under this Permit. For the purposes
of this Permit, a trip shall be defined as each time one of
Permittee's vehicles passes in front of Airport's Terminal
Building on the Lower Level only. The per trip fee payable shall
be established in the Airport's Rules and Regulations, which may
be amended from time to time by the Board of Supervisors.
Payments shall be made in lawful money of the United States, free
from all claims, demands, set-offs, or counter claims of any kind
against County. Payments not paid when due shall be subject to
interest thereon at the rate of one and one-half percent (1-1/2%)
per month.
B. To allow County to permanently affix a transponder to the roof of
Permittee's vehicles so that County may monitor Permittee's
operation of its vehicles on the Terminal roadways and
automatically record the number of monthly vehicle trips Permittee
conducts under this Permit.
In the event of an Automatic Vehicle Identification System
failure, County shall determine Permittee's monthly fee based upon
the number of vehicle trips made in the same month prior year, or
if less than one full year of operation, Permittee's fee shall be
based upon the average of the number of vehicle trips for the
total number of months in operation under this Permit.
County will provide the first transponder for each of Permittee's
vehicles.
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Permittee will pay for any replacement transponders. County, or
its agent or employees, shall attach the transponder to the
vehicle roof, County shall not drill, rivet or otherwise puncture
the body of Permittee's vehicles in the course of installing the
transponder unit, and shall install the transponders in a
workmanlike manner so as to avoid unnecessary damage to the roofs
of Permittee's vehicles.
Permittee agrees to waive all and any claims against the County
for any or all incidental damage caused to Permittee's vehicles by
the ordinary process of install or removing the transponders.
5. Books and Records
Permittee shall maintain for a period of four years or, in the event of
claim by County, until such claim of County for payments hereunder shall
have been fully ascertained, fixed and paid, separate and accurate daily
records of gross revenues derived from ground transportation operations
and trip activity as herein defined, and in accordance with generally
accepted accounting principles, showing detail all business done or
transacted in, on, about or from or pertaining to Permittee's operations
at Airport, and Permittee shall enter all receipts arising from such
business in regular books of account, and all entries in any such records
or books shall be made at or about the time the transactions respectively
occur. In addition, Permittee shall maintain monthly and annual reports
of gross revenues and trip activity derived from its operation under this
Permit, using a form and method as is determined by Director. Such forms
and methods shall be employed by Permittee throughout the term of this
Permit. Such books and records shall be maintained at Permittee's
principal place of business unless otherwise permitted by Director in
writing. Upon Director's written request, Permittee shall make available
immediately at Airport any and all books, records and accounts pertaining
to its operations under this Permit. The intent and purpose of the
provisions of this section are that Permittee shall keep and maintain
records which will enable County to ascertain, determine and audit, if so
desired by County, clearly and accurately, the gross revenues and trip
activity of Permittee, and that the form and method of Permittee's
reporting of gross revenues and trip activity will be adequate to provide
a control and test check of all revenues derived by
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Permittee under this Permit.
Should any examination, inspection, and audit of Permittee's books and
records by County disclose an underpayment by Permittee in excess of five
percent (5%) of the consideration due, Permittee shall promptly pay
County the amount of such underpayment and shall reimburse County all
costs incurred in the conduct of such examination, inspection, and audit.
In the event that County deems it necessary to utilize the services of
legal counsel in connection with collecting the reimbursement for such
examination, inspection, and audit, then Permittee shall reimburse County
for reasonable attorney's fees and litigation expenses as part of the
aforementioned costs incurred.
Not later than ninety (90) days after the annual anniversary of the
commencement of this Permit, when required by Director, Permittee shall
furnish to County a confidential report, certified by Permittee to be
true and correct, of the ground transportation gross revenues and trip
activity derived by Permittee from its operations permitted hereunder.
Said report shall not be made public except as required by law.
Permittee shall furnish County with such other financial or statistical
reports as Director, from time to time, may reasonably require.
6. Other Charges and Fees
Permittee shall pay all other charges, penalties or fees occasioned by
Permittee's operations or activities on or about the Airport.
7. Indemnity
Permittee and Permittee's independent contractors agree to defend,
indemnify and hold harmless County, Board of Supervisors and its members,
and all of the officers, agents, and employees if each of them, from and
against all damages, claims, demands, obligations, suits, judgements,
penalties, causes of action, losses or liability for injuries to or
deaths of persons or damage to property proximately caused by or arising
out of acts, omission, use occupancy or operation of the actions of
Permittee or Permittee independent contractors related to this Permit.
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Each party hereto shall give to the other prompt and timely written
notice of any claim made or suit instituted coming to its knowledge which
in any way, directly or indirectly, contingently or otherwise, affects or
might affect either, and each shall have the right to participate in the
defence of the same to the extent of its own interest.
8. Insurance
Permittee shall procure and maintain during the term of this Permit the
following insurance:
A. Workers' Compensation, with Employer's Liability at a minimum
single limit of $1,000,000.
B. Comprehensive General Liability Insurance with respect to each
occurrence of bodily injury, property damage, contractual
liability, independent contractors, personal injury, products, and
completed operations with a minimum single limit of $1,000,000.
C. Comprehensive Automobile Liability Insurance with limits not less
than FIVE MILLION DOLLARS ($ 5,000,000) each occurrence combined
single limit bodily injury or property damage, including
employer's non-ownership liability and hired automobile coverage.
The evidence of insurance (policy or certificate) must contain the
following Endorsements:
D. Additional Named Insureds: The County of Orange, the Board of
Supervisors of Orange County and its members and all of their
officers, employees and agents of each of them are named as
additional insureds hereunder.
E. Severability of Interest (Cross Liability): The term "the insured"
is used severally and not collectively, and the insurance afforded
under the liability coverage applies separately to each insured
against whom claim is made or suit is brought, but the inclusion
herein of more than one insured shall not operate to increase the
limits of the company's liability.
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F. Cancellation or Material Change Notice: Written notice of
cancellation or of any material change in said policy shall be
delivered thirty (30) days in advance of the effective date
thereof to: John Wayne Airport, Landside Operations, 18601 Airport
way #41, Santa Ana, CA 92707. Such written notice will commence
from the date the notice is actually received at the John Wayne
Airport.
G. Premises and/or Operations Insured: Activities upon, in and around
John Wayne Airport and any space hereafter assigned.
H. No Other Insurance Stipulation: No other insurance effected by the
County of Orange will be called on to contribute to a loss covered
hereunder.
I. Primary Insurance: Such policies are primary insurance to any
other insurance available to the Additional Insureds, with respect
to any claims arising out of this Permit, and that insurance
applies separately to each insured against whom claim is made or
suit is brought.
Certificates of insurance evidencing all coverages and endorsements above
shall be furnished to the County before commencing any operations under
this Permit.
Permittee agrees that the terms of these insurance requirements may be
increased and revised upon the written demand of the County, which demand
must be based on reasonable and justifiable grounds.
9. Faithful Performance Bond
Permittee agrees that upon execution of this Permit, it will, at its own
expense, deliver to Director a surety bond or bonds in the amount of TWO
THOUSAND DOLLARS ($ 2,000 ), payable to County, naming County as obligee
and issued by a surety company or companies acceptable to County, and in
such form as approved by County, which surety bond or bonds may be
renewed annually, and shall be maintained in full force and effect during
the term of this Permit at the expense of the Permittee, to insure the
faithful performance by Permittee of all the covenants, terms and
conditions of this Permit, inclusive of but not restricted to the payment
of all considerations provided therein. The surety company issuing said
bond or
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bonds shall give Director notice in writing by registered mail at least
sixty (60) days, prior to an anniversary date of its intention not to
renew said bond or bonds. In lieu of such surety bond or bonds, permittee
may deposit with County an Irrevocable Letter of Credit, Treasury Bonds
of the United States of America, Certificates of Deposit or a Certified
Check, in a form acceptable to County, in the agreed amounts as security
for faithful performance by Permittee as herein above provided, and
Permittee may have the right to reserve to itself interest payable on
said United States Bonds, or Certificates of Deposit.
County reserves the right to adjust the amount of the Faithful
Performance Bond to reflect changes in operations or changes in "trip"
fees established by County. Within thirty (30) days after notification of
any change in required Faithful Performance Bond amount from County,
Permittee shall submit to County any additional Faithful Performance Bond
as may be required.
10. Right of Access
During the existence of the Permit, and subject to the Airport's rules
and regulations, Permittee, its agents, licensees and business invitees,
shall possess the right of ingress to and egress from and about the
Airport by authorized vehicles bearing valid identification stickers and
automatic vehicle identification devices, as required by Permittee's
operations hereunder; provided that such right shall not be exercised in
a manner and to such extent as to impede or interfere with the operation
of the Airport by County, its lessees, or other permittees, and shall be
subject to the rules and regulations of the Airport.
11. Waybills
Every Door-to-Door passenger pickup shall be documented by a waybill
prepared in advance of the pickup. Waybills shall be prepared by
Permittee or the driver of the Permittee's vehicle prior to the vehicle's
arrival at the Airport passenger pickup zone. The waybill shall state the
passenger's name, the number of persons in the party, the location of the
pickup, the time of the scheduled pickup, and the airline and flight
number on which the passenger has arrived. The driver of the Permittee's
vehicle is required to present the waybill to any Airport official who
requests to inspect it. The driver of the Permittee's vehicle may prepare
the waybill based on radio or telephone communications to the driver.
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12. Default by Permittee
Permittee shall be in default under this Permit if:
A. Permittee shall fail duly and punctually to pay the fees, or to
make any other payment required hereunder, when due to County; or
B. The interest of Permittee under this Permit shall be transferred,
without the approval of the County, by reason of death, operation
of law, assignment, sub-lease or otherwise, to any person, firm or
corporation; or
C. Permittee shall voluntarily abandon, desert or fail to use its
rights hereunder; or
D. Permittee shall fail to keep, perform or observe each and every
other promise, covenant and agreement set forth in this Permit,
including maintenance of affirmative action and employment
non-discrimination goals as set forth herein or the submission of
reports requested herein, and such failure shall continue for a
period of more than thirty (30) days after delivery by Director of
a written notice of such breach or default, except where
fulfillment of its obligation requires activity over a period of
time, and Permittee shall have commenced in good faith to perform
whatever may be required for fulfillment within ten (10) days
after receipt of notice and continues such performance without
interruption except for causes beyond its control; or
E. Permittee shall use or give its permission to any person to use
any portion of Airport, used by Permittee under this Permit, for
any illegal purpose.
13. County Remedies
If default is made by Permittee in any of the covenants, terms and
conditions herein contained, County may elect to:
A. Allow this Permit to continue in full force and effect and to
enforce all of the County's rights and remedies hereunder,
including, without limitation, the right to collect fees as they
become due together with interest thereon at the rate of one and
one-half percent (1 - 1/2%) per
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hereunder or which in the ordinary course would likely result
therefrom.
15. No Waiver of Subsequent Breaches or Defaults
The failure of County at any time to insist upon a strict performance of
any of the terms, conditions and covenants herein shall not be deemed a
waiver of any subsequent breach or default in the terms, conditions and
covenants herein.
16. Prohibition Against Advertising
No advertising or solicitation, including the posting of room rates or
transportation fares, shall be allowed on any of Permittee's vehicles,
unless specifically approved in writing by Director; except that a
vehicle may display Permittee's authorized common color scheme and
markings and destination signs.
17. Prohibited Conduct
The following activities are Permittee are prohibited:
A. Picking up or discharging passengers or their baggage at any
terminal level other than those designated for such purpose;
B. Leaving the vehicle unattended;
C. Failing to give, upon a passenger's request a receipt showing the
amount of fare paid, the driver's correct name, the name of the
Permittee and the vehicle number, if any;
D. Failing to maintain the interior and exterior of the vehicle in a
clean condition;
E. Littering of the loading zone;
F. Providing false information to authorized Airport Personnel;
G. Failure to display a waybill on request by any Airport Official;
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H. Displaying to an Airport Official a waybill in an altered or
fictitious form:
I. Driving in a vehicle that does not bear a valid identification
sticker or an automatic vehicle identification device issued by
the Airport;
J. Solicitation of passengers on Airport property; except as
otherwise provided by contract or permit with the Airport;
K. The use or possession of any alcoholic beverage, or any dangerous
drug or narcotic, while operating a vehicle on the Airport;
L. Failing to operate a vehicle in a safe manner as required by the
California Vehicle Code;
M. Failing to comply with posted speed limits and traffic control
signs;
N. Use of profane or vulgar language directed to or at the public;
O. Any attempt to solicit payment in excess of that authorized by
law;
P. Any solicitation for or on behalf of any hotel, motel, club or
nightclub;
Q. Any solicitation of any activity prohibited by the Penal Code of
the State of California;
R. Operating a vehicle which is not in a safe mechanical condition or
which lacks mandatory safety equipment as defined in the
California Vehicle Code;
S. Disconnecting any pollution control equipment;
T. Engaging in any conduct or activity intended to or apparently
intended to ask, implore or persuade a passenger to alter his or
her previously chosen mode of ground transportation or specific
ground transportation operator, except as otherwise provided by
contract or permit with the Airport.
18. Compliance with Rules and Regulations
Permittee shall abide by and conform to all laws, governmental orders,
rules
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and regulations, including any future amendments thereto, controlling or
in any manner affecting the use or occupancy of Airport property.
Permittee shall abide by and conform to all Airport Rules and
Regulations, operational notices or bulletins now and hereafter in force
and effect. Permittee shall provide County with a copy of its current
appropriate California Public Utilities Commission Permit.
19. Nonassignability
This Permit is not assignable, in whole or in part.
20. Revocable Permit
This permit is revocable at any time, in the absolute discretion of the
Director. Such revocation shall be accomplished by giving 24 hours prior
written notice to the Permittee. Should Permittee, at any time, fail to
provide or maintain the insurance or faithful performance bond required
under this Permit, then the Director may, by 24 hour prior written
notice, revoke this Permit. Permittee may terminate this Permit by giving
thirty (30) days prior written notice to the Director. This Permit may be
cancelled by the mutual written consent of the parties at any time
without the aforesaid written notice.
21. Section Headings
The section headings contained herein are for convenience in reference
and are not intended to define or limit the scope of any provision of
this Permit.
22. Severability
In the event any term, covenant or condition herein contained is held to
be invalid by any court of competent jurisdiction, such invalidity shall
not affect any other valid term, covenant or condition herein contained.
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IN WITNESS WHEREOF, the parties hereto have executed this Permit in duplicate by
their duly authorized officers.
PERMITTEE: COUNTY OF ORANGE:
By /s/ Stephen Allan /s/ O. B. Schooley
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Authorized Signature Airport Director
Title President
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Dated 7-7-97 Dated 7/17/97
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[JOHN WAYNE AIRPORT Letterhead]
July 17,1997
Mr. Stephen Allen, President
Preferred Transportation, Inc.
1430 S. Anaheim Blvd.
Anaheim, CA 92805
Subject: GROUND TRANSPORTATION OPERATING PERMIT
Dear Ground Transportation Operator:
Enclosed you will find your copy of the Commercial Ground Transportation
Operating Permit between John Wayne Airport and your organization. The original
signed permits are kept in our central files at John Wayne Airport.
Additionally, I am returning the security deposit instrument filed with John
Wayne Airport on October 16, 1990 from Supershuttle International, Inc. That is
now considered obsolete.
Sincerely,
/s/ William Pemberton
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William Pemberton
Manager, Landside Operations
Enclosure
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NO. 5518675 $2,000.00
COUNTY OF ORANGE
Santa Ana, California
RECEIVED OF: PREFERRED TRAN. INC DATE: 7-8-97
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ADDRESS: (SUPER SHUTTLE CITY:
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FOR ORANGE CO)
-------------------------------------------------------------
GROUND TRANS. DEPOSIT
- -----------------------------------------------------------------
Questions? Contact the agency/department where payment was made.
(Directory assistance 834-5400) Suspect fraud?
Contact the Internal Audit Department at 834-5475
PAID BY CASH $ CHECK NO. 018043 /s/ JWA
---------------- --------------- --------
COUNTY NO. STATE NO.
---------------- ---------------
BY: /s/ R Reddick
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PAYMENT BOND CERTIFICATE
[Union Bank Logo] Office of Account: #335 L.A.X. International Airport
Account Number: #3359007832 Amount Deposited $5,250.00**** On October 16, 1990
FIVE THOUSAND TWO HUNDRED FIFTY NO/100**** UNITED STATES**** Dollars was
deposited for Collateral Hold by Supershuttle International, Inc.*****
(Depositor) and is payable to Supershuttle International, Inc. As Collateral
Hold For John Wayne Airport on January 14, 1991 (the Maturity Date), upon
presentation of this Certificate, properly endorsed. This deposit will earn
interest at the rate of 7.200%, compounded daily using a 365-day year, for an
effective annual yield of 7.460%******. Interest will be paid to the Depositor
Supershuttle, Inc. If this Certificate is not presented for payment on the
account's Maturity Date or within TEN days after that date, the deposit will be
renewed for a like term at the interest rate in effect on the account's Maturity
Date. This Certificate in NONE transferable.
If all or any part of this deposit is withdrawn before the account's original
or any subsequent maturity date, the amount withdrawn may be subject to an
early withdrawal or compensating fee.
Certificate Serial Number: 011192 B A Thomas
AUTOMATIC RENEWAL, NON-NEGOTIABLE ------------------------------
AUTHORIZED SIGNATURE
FORM 3117 (Rev. 10/89) 119232--1 Member FDIC