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<br />21 <br /> <br />COLLATER~L LETTER OF AGREEMENT <br /> <br />To: <br /> <br />Trans-Air Industries, Inc. <br /> <br />From: <br /> <br />The City of San Marcos the San Marcos Municipal Airport <br /> <br />Subject: <br /> <br />Agreement Between The City of San Marcos (City) And Trans-Air <br /> <br />Industries, Inc. (Trans-Air) <br /> <br />PURPOSE: <br /> <br />This agreement <br /> <br />establishes <br /> <br />the <br /> <br />responsibilities <br /> <br />of <br /> <br />these <br /> <br />parties <br /> <br />for <br /> <br />the <br /> <br />use, <br /> <br />maintenance, upkeep, and liability for the San <br /> <br />Marcos Municipal Airport aviation fuel facility located adjacent to the <br /> <br />parking apron east of the present Fixed Base Operator (FBO) <br /> <br />operations <br /> <br />building <br /> <br />and <br /> <br />modifies <br /> <br />the <br /> <br />liability <br /> <br />insurance <br /> <br />requiremen-ts <br /> <br />for <br /> <br />Trans-Air's <br /> <br />commercial <br /> <br />operations. <br /> <br />The <br /> <br />terms <br /> <br />and <br /> <br />conditions <br /> <br />established <br /> <br />hereunder <br /> <br />are <br /> <br />in <br /> <br />addition <br /> <br />to <br /> <br />the terms and conditions <br /> <br />contained in those leases which are the subject of that Assignments <br /> <br />of <br /> <br />Leases <br /> <br />executed <br /> <br />herewith <br /> <br />to <br /> <br />Trans-Air <br /> <br />from GT+3 Flight Operations, <br /> <br />Inc. <br /> <br />Any disputes or conflicts which may arise between the <br /> <br />terms <br /> <br />and <br /> <br />conditions <br /> <br />contained <br /> <br />herein, and those contained in said leases shall <br /> <br />be settled in favor of the <br /> <br />terms <br /> <br />and <br /> <br />conditions <br /> <br />contained <br /> <br />in <br /> <br />this <br /> <br />agreement. <br /> <br />However, <br /> <br />this <br /> <br />agreement <br /> <br />shall <br /> <br />not <br /> <br />serve <br /> <br />to <br /> <br />modify, <br /> <br />substitute or make void any other term or condition of said leases. <br /> <br />1. <br /> <br />City hereby agrees that Trans-Air may have the use, <br /> <br />custody, <br /> <br />and <br /> <br />control <br /> <br />of <br /> <br />an <br /> <br />airport <br /> <br />fuel <br /> <br />storage and dispensing facility located <br /> <br />adjacent to the parking apron and east of the <br /> <br />present <br /> <br />FBO <br /> <br />operations <br /> <br />building. <br /> <br />2. <br /> <br />Trans-Air <br /> <br />agrees <br /> <br />to <br /> <br />use the airport fuel storage and dispensing <br /> <br />facility in accordance with its FBO operation lease agreement with <br /> <br />the <br /> <br />City (except as modified hereby), and in accordance with the San Marcos <br /> <br />Municipal Standard Operating Procedures and Regulations. <br /> <br />3. <br /> <br />For <br /> <br />the duration of this agreement, Trans-Air agrees to maintain, <br /> <br />repair, keep, and assume all liability for said airport fuel facility. <br /> <br />4. <br /> <br />Trans-Air shall at its own expense, purchase, maintain <br /> <br />and <br /> <br />keep <br /> <br />in force such insurance as will protect Trans-Air from claims set forth <br /> <br />below <br /> <br />which <br /> <br />may arise out of or result from any operations at the San <br /> <br />Marcos Municipal Airport whether such operations be by Trans-Air or by <br /> <br />any subcontractor or by <br /> <br />anyone <br /> <br />directly <br /> <br />or <br /> <br />indirectly <br /> <br />employed <br /> <br />by <br /> <br />Trans-Air or by anyone for whose acts Trans-Air or any subcontrctor may <br /> <br />be liable: <br /> <br />-1- <br />