Document Ogden_doc_dae960e7ab

Page 1 of 6 Ogden City Council Meeting: July 11, 2017 COMMERCIAL AIR SERVICE – OGDEN HINCKLEY AIRPORT - Air Service Agreement with Allegiant Air LLC Action: Adopt or Not Adopt Resolution Executive Summary The Council with consider a Resolution approving an Air Service Agreement with Allegiant Air LLC to provide weekly flights to Los Angeles International Airport (LAX) and McCarran (Las Vegas) International Airport (LAS). Service to LAX will begin October 5, 2017. Service to McCarran will begin November 17, 2017. Additional flights to Oakland and Orland may be added in 2018 and 2019 respectively. Background Ogden Hinckley Airport- History Ogden City has operated a municipal airport since 1928. The original airport was located on 200 acres in the South Birch Creek area and consisted of three gravel runways. The current airport is located on approximately 706 acres of land west of Ogden City. Construction of the airport was completed in December of 1941. The Airport was originally known as the Robert H. Hinckley Field, named for the serving Assistant Secretary of Commerce, an Ogden native, and one of the original members of the flying club that initiated construction of the first Ogden airport. The military began training Navy pilots at the Airport under a joint-use lease agreement in 1942. More than 500 Navy cadets were trained at Hinckley Airport. After the military uses were transferred to Hill Air Force Base the Airport was renamed the Ogden Municipal Airport. In 1943, Western Air Airline began mail and passenger service from Ogden. United Airlines followed in 1946. Both of these services were discontinued in 1960 due to decreased demand for service. In 1988, the airport was given its current name—Ogden-Hinckley Airport. In 1993, the City Council and Mayor entered into a Joint Resolution establishing an Ogden-Hinckley Airport Development Task Force to ---PAGE BREAK--- Page 2 of 6 Ogden City Council Meeting: July 11, 2017 determine, in part, how to develop the airport into a Commercial Service/General Aviation Facility. It wasn’t until 2012 that the City was able to enter into an agreement with Allegiant Air to provide commercial passenger service to and from the Ogden area. Allegiant currently operates two flights per week from Ogden to Mesa, Arizona. The Ogden-Hinckley Airport is currently a designated “reliever” for the Salt Lake City International Airport and a designated alternate facility for SLC air carrier operations. The airport currently accommodates all segments of the aviation industry--passenger and cargo service, general aviation, military, corporate, emergency medical, and agricultural users. January-April 2012 The Administration entered into negotiations with Allegiant Air to provide commercial air service to and from Ogden Hinckley Airport. April 17, 2012 The Council approved Ordinance 2012-19 amending the Capital Improvement Plan to include AR085, Airport Terminal Expansion. The Council subsequently funded the project for $650,000. In order to meet the requirements for commercial passenger air service, the Airport had to become compliant with the security requirements of the Transportation Security Administration (TSA) by providing space for security screening, a secure passenger waiting area, and break and office space for TSA personnel. September 20, 2012 Allegiant Air began providing passenger service between Ogden and Phoenix. Allegiant has maintained two weekly flights to and from the Ogden Airport since that date. The Administration hoped that additional destinations and flights would be added. However, those additional flights did not immediately materialize. ---PAGE BREAK--- Page 3 of 6 Ogden City Council Meeting: July 11, 2017 March 10, 2013 Ogden City entered into an Agreement ($75,000) with Ogden Weber Convention and Visitors bureau to provide marketing for in-bound flights to Ogden Hinckley Airport. 2015 – Ogden Airport Development Feasibility Study In 2015, the City completed a feasibility study that highlighted several opportunities for growth and development at the Airport. The study identified growth potential in general aviation, non-aviation commercial development, mixed-used aviation, MRO (maintenance, repair and operations) development, and cargo and commercial airline development. The Study also specifically addressed the opportunities for growth that may come with Hill’s F-35 program. The consultants estimate that when fully developed, the Airport could add more than 4,000 new jobs to the local economy. March 7, 2017 The Council held a work session to review and discuss the Administration’s proposal to entice new commercial air service to Ogden Hinckley Airport. The City’s General Fund has been subsidizing the Airport Fund between $500,000 and $750,000 per year for at least the last decade. Increasing demands on the General Fund for other city services makes this subsidy unsustainable. The Administration argued that this “catalytic” project to bring new air service to the airport was the only way to change the financial trajectory of the Airport. March 14, 2017 The Council approved Resolution 2017-6 that established the parameters for entering into an agreement for additional air service at the Ogden Airport. The Parameters Resolution authorized an incentive package valued at $1.1 M to entice airlines to provide additional air service to Ogden Hinckley Airport. The package included escrow funds for mobilization and revenue guarantees, and fee waivers, anticipating that other entities would partner with the City in the financial support of the project. Pursuant to the Parameters Resolution, the Administration ---PAGE BREAK--- Page 4 of 6 Ogden City Council Meeting: July 11, 2017 published a Request for Letters of Interest (RLI) to the air carrier industry. April-June 2017 The Administration entered into negotiations with three airlines that had responded to the RLI—Allegiant and two other airlines that would be new to the Ogden market. Ultimately, the Administration determined that Allegiant’s proposal to expand existing service was the best fit for the City in the short term. The Administration continues to work with the other airlines in hopes of bringing additional air service to the airport. June 20, 2017 Allegiant formally announced that new commercial air service to Los Angeles and Las Vegas would begin in October and November 2017. The Mayor subsequently executed a contract with Allegiant Air LLC. The contract is subject to Council approval. Proposal The Administration is requesting approval of the Air Service Agreement between Ogden City and Allegiant Air LLC. Key terms of the Agreement are as follows:  Roundtrip service to LAX (Los Angeles) will begin October 5, 2017  Roundtrip service to LAS (Los Vegas) will begin November 17, 2017  Subject to Agreement by January 1 2018, roundtrip service to OAK (Oakland) will begin June, 2018  Subject to Agreement by January 1 2019, roundtrip service to SFB (Orlando) will begin June, 2019  Allegiant will operate normal pre-flight and in-flight passenger services  Allegiant will offer flights on its website, but is not obligated to do additional marketing  City may engage in its own promotional and marketing activities  Agreement is effective June 20, 2017 for a term of three years unless terminated earlier ---PAGE BREAK--- Page 5 of 6 Ogden City Council Meeting: July 11, 2017  Either party may termination the Agreement with or without cause with 45 days’ notice  Parties must receive consent prior to using the others logo or other promotional materials to solicit participation  City guarantees minimum Total Departure Revenue for each Departure as follows: o LAX—lesser of 100% of shortfall or $5,122 o LAS—lesser of 100% of shortfall or $5,459 o OAK---lesser of 100% of shortfall or $6,229 o SFB-- lesser of 100% of shortfall or $24,280  Allegiant will share profits as follows: o LAX—40% of revenues over $19,207 o LAS—60% of revenues over $13,648 o OAK---50% of revenues over $18,112 o SFB-- 50% of revenues over $69,373  Allegiant will maintain a combined ledger of all destinations showing credits to Allegiant for shortfalls and debits for revenues owed to City and provide a report to City. Payment requests can be made by any party at any time. Payments are due within 30 days  Allegiant accepts all liability for operation of flights and indemnifies City  City accepts liability for own negligence or misconduct relating to Flights and for breach or non-compliance pertaining to the Agreement The Administration has indicated the City will recognize the following benefits from the additional air service:  Reduction in Airport operating losses  Additional landing and fuel flowage fee revenues  Additional parking revenues  Greater business attraction to the airport and potential for additional airlines or flights  Additional FAA grant funds  Increased tourism and visitor expenditures ---PAGE BREAK--- Page 6 of 6 Ogden City Council Meeting: July 11, 2017  Possibility of new hospitality jobs Questions 1. Please review the terms and conditions of the proposed Air Service Agreement. 2. Will CIP projects previously approved by the Council—parking and terminal bathrooms--be completed as planned? Council Staff Contact: Janene Eller-Smith (801)629-8165 ---PAGE BREAK--- ---PAGE BREAK--- ---PAGE BREAK--- 2017-14 ---PAGE BREAK--- ---PAGE BREAK--- 1 AIR SERVICE AGREEMENT This AIR SERVICE AGREEMENT (“Agreement”) is made and entered into as of June 20, 2017 (“Effective Date”) by and between Allegiant Air LLC, a Nevada limited liability company with its principal offices at 1201 N Town Center Drive, Las Vegas, NV 89144 (“Allegiant”), and OGDEN CITY, a municipality and political subdivision of the state of Utah (“City”), having its principal place of business at 2549 Washington Blvd., Ste 400, Ogden Utah 84401. Allegiant and the City are referred to collectively herein as the "Parties" and sometimes individually as a "Party." RECITALS: A. The City is the owner and operator of the Ogden-Hinckley Airport with the power to lease premises and facilities at the Airport and to grant rights and privileges with respect thereto. B. On March 17, 2017, the City issued a Request for Letters of Interest (“RLI”) from air carriers to provide new air service between the Airport and a large or medium hub airport serving the Los Angeles, San Francisco/Oakland and/or Orlando metropolitan areas with the support of an incentive program (the “Incentive Program”). C. The City is serving as the administrator of the Incentive Program on behalf of itself and possibly others, including the County of Weber, Utah, the County of Davis, Utah and the Summit Powder Mountain Resort (collectively with the City, the “Program Contributors”). D. Financial contributions made by the City for use in the Incentive Program will not be made from OGD funds. E. Through the Incentive Program, the City seeks to increase access from OGD to the national aviation system and the largest origin and destination markets from OGD. F. On or about March 21, Allegiant and others responded to the RLI and expressed interest in the Incentive Program. Allegiant’s response provides an outline of service to the requested destinations, but also requires service to McCarran International Airport in Las Vegas (LAS) to be viable. G. The City has requested that Allegiant, a certificated air carrier, provide up to 13 weekly flights. Allegiant will begin operating the schedule attached hereto as Exhibit provide regularly scheduled round-trip passenger flights between OGD and (currently, Allegiant’s entire network schedule only goes through February 13, 2018, so flights are only shown through that point): a. Los Angeles International Airport (LAX), with flights commencing on October 5, 2017, b. McCarran International Airport(LAS), with flights commencing on November 17, 2017, ---PAGE BREAK--- 2 c. Subject to the City and Allegiant each agreeing to expand this contract (as detailed below), to San Francisco/Oakland metropolitan areas through the Metropolitan Oakland International Airport (OAK), with flights commencing in early June of 2018, and d. Subject to the City and Allegiant each agreeing to expand this contract (as detailed below), to Orlando metropolitan area through the Orlando Sanford International Airport (SFB), with flights commencing in early June of 2019. H. As part of the Incentive Progaram, the Parties proposed that the City would guarantee that each Departure (as defined below) will generate no less than the specified amount of revenue for Allegiant as set forth in Exhibits “B – LAX”, Exhibit “C – LAS”, “Exhibit D – OAK” and “Exhibit E – SFB”; I. The Parties also proposed that Allegiant share a certain percentage of its revenues over and above a fixed amount as outlined in Exhibits “B – LAX”, Exhibit “C – LAS”, “Exhibit D – OAK” and “Exhibit E – SFB”, and J. Allegiant has agreed to operate the flights upon the terms and conditions set forth in this Agreement; NOW, THEREFORE, in consideration of the mutual obligations and undertakings set forth herein, the Parties agree as follows: 1. Defined Terms. When used herein, the following terms shall have the meanings set forth below: A. Destination or Destinations shall refer to one or more of the following destinations: Ogden, Los Angeles, Las Vegas, Oakland and Orlando. B. Departure shall refer to an aircraft takeoff for each One-Way Flight to any given Destination. C. Business day means a day other than a Saturday or Sunday on which the banks in Las Vegas, Nevada and Ogden, Utah are open for the transaction of business of the type required by this Agreement. D. One-Way Flight or One-Way Flights shall mean each one-way flight or multiple one-way flights from or to OGD and from or to any one or more of the Destinations. E. Two-Way Flight or Two-Way Flights shall mean each two-way flight or multiple two-way flights from or to OGD and from and to any one or more of the Destinations. ---PAGE BREAK--- 3 F. Flight or Flights shall mean one or more One-Way Flights or Round Trip Flights. G. LAX Rround-Trip Flights means flights that operate between LAX-OGD and OGD-LAX. H. LAS Rround-Trip Flights means flights that operate between LAS-OGD and OGD-LAX.. I. OAK Rround-Trip Flights means flights that operate between OAK-OGD and OGD-OAK. J. SFB Rround-Trip Flights means flights that operate between SFB- OGD and OGD-SFB. K. Market or Markets shall mean the routes to and from any Destination. L. Total Departure Revenue shall mean the total actual net revenue received by Allegiant for each One-Way Flight, including the total gross airfare amount paid by passengers in connection with the applicable Departure, the non-airfare revenue for the applicable Departure (including bags, seat assignments, priority boarding, boarding pass printing fees, pet fees, and applicable booking and change fees), and the third-party ancillary revenue that is derived from the sale of travel products and services to the passengers on the applicable Departure (including but not limited to rental cars, hotels, shows, and shuttles), but less, and therefore subtracting from the sum of items through all amounts actually paid by Allegiant for taxes, impositions, duties and fees included within items through Total Departure Revenue shall not include in-flight sales of drinks, peanuts, food, etc. 2. Scheduled Flights. A. LAX Rround-Trip Flights. Beginning October 5, 2017, (the “Service Commencement Date”), Allegiant will operate twice weekly, scheduled air service utilizing Airbus A319 series jet aircraft configured for 156 passengers in single-class seating. The departure and arrival times and days may be modified periodically by Allegiant in accordance with its customary scheduling procedures and operational requirements and does not require consent of the City. The City will be notified of the schedule and any changes to the schedule as and when finalized by Allegiant. Notification of changes shall be greater than seventy-two (72) hours from first departure under such changed schedule. B. LAS Rround-Trip Flights. Beginning November 17, 2017, Allegiant will operate twice weekly, scheduled air service utilizing Airbus A319 series jet aircraft configured for 156 passengers or McDonnel Douglas MD80 series aircraft ---PAGE BREAK--- 4 configured for 166 passengers, each in single-class seating. The departure and arrival times and days may be modified periodically by Allegiant in accordance with its customary scheduling procedures and operational requirements and does not require consent of the City. The City will be notified of the schedule and any changes to the schedule as and when finalized by Allegiant. Notification of changes shall be greater than seventy-two (72) hours from first departure under such changed schedule. C. Oakland Rround-Trip Flights. Subject to Allegiant and the City each agreeing by January 1, 2018, then beginning in June of 2018, or as otherwise agreed upon by the Parties, Allegiant will operate weekly, scheduled air service utilizing Airbus A319 series jet aircraft configured for 156 passengers in single-class seating. The departure and arrival times and days may be modified periodically by Allegiant in accordance with its customary scheduling procedures and operational requirements and does not require consent of the City. The City will be notified of the schedule and any changes to the schedule as and when finalized by Allegiant. Notification of changes shall be greater than seventy-two (72) hours from first departure under such changed schedule. If Allegiant and the City do agree to the OAK flights, then the revenue terms attached hereto in Exhibit D will dictate the guarantee and profit sharing. D. Orlando Rround-Trip Flights. Subject to Allegiant and the City each agreeing by January 1, 2019, then beginning in June of 2019, or as otherwise agreed upon by the Parties, Allegiant will operate weekly, scheduled air service utilizing Airbus A320 series jet aircraft configured for 177 or 186 passengers in single-class seating. The departure and arrival times and days may be modified periodically by Allegiant in accordance with its customary scheduling procedures and operational requirements and does not require consent of the City. The City will be notified of the schedule and any changes to the schedule as and when finalized by Allegiant. Notification of changes shall be greater than seventy-two (72) hours from first departure under such changed schedule. If Allegiant and the City do agree to the SFB flights, then the revenue terms attached hereto in Exhibit E will dictate the guarantee and profit sharing. 3. Passenger Services. The Flights will operate with Allegiant’s normal pre- flight and in-flight passenger services. These services include goods and services made available for a fee or charge paid to Allegiant by or on behalf of the passenger receiving the service. 4. Pricing, Promotion, Booking and Sales. A. Allegiant will use its reasonable commercial judgment in setting and/or revising seat inventory allocations and retail fare levels offered on the Flights with the objective of maximizing revenue through maximization of the number of passengers on each Flight, in a manner consistent with Allegiant’s established retail sales strategy as determined from time to time. ---PAGE BREAK--- 5 B. Allegiant will offer on its website (allegiantair.com) Flights in the Markets on a co-equal basis with Allegiant’s other scheduled service flights, but will not be obligated to engage in other sales, marketing or promotional activity relating to the Flights. Subject to the requirements of Section 6 of this Agreement, OGD or the City shall be free to engage in such marketing and/or promotional activity relating to the Flights as it sees fit, at OGD or the City’s sole expense. Allegiant’s website, telephone call center and airport ticket counters will be the exclusive points-of-sale for passenger bookings on the Flights. Collection of passenger payments, passenger reservation changes, cancellations, and all other aspects of individual passenger transactions, including, but not limited to, baggage fees, trip flex, seat assignments, change fees, airport baggage sales and fees, will be handled in accordance with Allegiant’s normal practices and policies and the terms of its contract of carriage, which shall apply to all Flights in the Markets. 5. Term and Termination. A. This Agreement shall be effective as of the Effective Date and shall remain in full force for a period of three years thereafter, unless terminated earlier in accordance with the provisions of this Agreement. B. This Agreement may be terminated by the Party specified below (after having given any applicable notice specified below) upon the happening of any of the following events: i. By Allegiant, if Allegiant is unable to obtain the governmental or other approvals necessary to commence the Flights in the Markets or if Allegiant reasonably determines, in its sole discretion, that the operating facilities at the applicable airports (OGD, LAX, LAS, OAK, SFB) are inadequate for Allegiant to commence service; or the City fails to make any payment when due and does not make such payment within thirty (30) days after written notice or demand thereof; ii. By either Allegiant or the City, if the other Party is in breach or default under any provision of this Agreement and such other Party does not cure such breach or default within five days after the non-breaching or non-defaulting Party gives written notice to the other Party specifying the breach or default; iii. By either Allegiant or the City, with or without cause, upon not less than forty-five (45) days’ prior written notice to the other Party (“Termination Notice”). The right of termination under this subparagraph iii may apply to the entire Agreement or to any single Route or combination thereof. The Termination Notice shall include the effective date of termination, which must be no sooner than forty-five (45) days following the date the Termination Notice is mailed by certified mail, return receipt ---PAGE BREAK--- 6 requested, to the other Party, and (ii) a clear description of what is being terminated. C. A termination pursuant to Section 5. B. or Section 5. B. (ii) shall not limit the non-breaching or non-defaulting party’s right to pursue or enforce any of its rights under this Agreement or otherwise. The provisions of Section 14 below shall also govern the Parties’ respective rights and obligations in the instance of termination or expiration of this Agreement. 6. Advertising and Promotional Materials. OGD or the City will request Allegiant’s written consent prior to any use by OGD or the City (or by any agent, representative or contractor of OGD or the City) of Allegiant’s name or logo in any advertising, promotion or other material intended to solicit participation in one or more Flights, including but not limited to all such advertising, promotion and other material that may be disseminated electronically. Allegiant’s consent to such use will not be unreasonably withheld or delayed. Each Party shall retain responsibility and liability for the content of all advertising, promotional and other materials that it disseminates, including responsibility and liability for any noncompliance with laws, rules, regulations or policies administered by the U.S. Department of Transportation (DOT). 7. Operational Authority. The Flights will be conducted under the authority of Allegiant’s air carrier certificate and operations specifications issued by the Federal Aviation Administration (FAA) and its domestic certificate of public convenience and necessity issued by the DOT. Operation of each Flight is subject to applicable laws and the rules, regulations and policies of the FAA, the DOT, the Transportation Security Administration (TSA), and all other cognizant governmental agencies, as such may be amended from time to time. Allegiant will at all times have exclusive operational control of each Flight. Except as otherwise stated in this Agreement, all Flights will be operated under the Allegiant Terms and Conditions and as all Allegiant Air scheduled service flights. If in Allegiant’s regular course of business a need arises to cancel and not reschedule a flight, then Allegiant will follow normal company procedures in selecting flights and notifying and reaccommodating passengers. Any flights that are cancelled and not rescheduled will be removed from the revenue reconciliation totals described below. 8. Revenue Guarantee and Share. A. Revenue Guarantee. As an inducement to cause Allegiant to enter into this Agreement and maintain the proposed schedule in Exhibit A, the City hereby guarantees to Allegiant that each Departure in each Market in a calendar month, and throughout the term of this Agrement, will produce no less than a specified level of minimum Total Departure Revenue for each Departure as set forth in Exhibits “B – LAX” and “C – LAS” (herein, the revenue tables listed in Exhibits “B – LAX” and “C – LAS” shall constitute a “Schedule” and collectively, the “Schedules” and the specified level of minimum Total Departure Revenue is hereinafter referred to as the “Minimum Departure Revenue”). If the Total Departure Revenue for any given Departure fails to meet the Minimum Departure ---PAGE BREAK--- 7 Revenue according to the Schedules, the City agrees to pay to Allegiant the lesser of the amounts identified in each such Schedule (“One-Way Flight Guarantee Payment”). B. Revenue Share. As an inducement to cause the City to enter into this Agreement and to pay the Revenue Guarantee amounts pursuant to paragraph 8. A. above, Allegiant hereby agrees to pay to the City the revenue share amount listed in the “Schedules”. The specified level of Total Departure Revenue that triggers a revenue share payment to the City is hereinafter referred to as the “Excess Departure Revenue”. If the Total Departure Revenue for any given Departure exceeds the Excess Departure Revenue according to the applicable Schedule, Allegiant agrees to pay to the City the percentage of Excess Departure Revenue as identified in the Schedules (“One-Way Excess Revenue Payment”). C. Destination Revenue Guarantee and Share Accounting. Allegiant agrees to maintain an ongoing spreadsheet ledger (“Destination Ledger”) for each Destination that shows each One-Way Flight Gurarantee Payment due to Allegiant (shown as a “Credit” on the spreadsheet) and each One-Way Excess Revenue Payment due to the City (shown as a “Debit” on the spreadsheet) to and from each Destination and the cumulative running balance of Debits and Credits. By the 10th of each month, Allegiant agrees to provide the City with the cumulative running balance of Debits and Credits. If the City wishes to inspect a copy of each month- end Destination Ledger for the prior month for all Destinations, then Allegiant will make a copy available (as well as other relevant materials to bookings and revenue calcualations) at Allegiant headquarters for inspecition,by the City, though the City may not keep a copy of the records. D. Cumulative Revenue Guarantee and Share Accounting. Allegiant agrees to maintain an ongoing spreadsheet ledger (“Combined Ledger”) that shows the balance from each month-end Destination Ledger for all Destinations. A positive balance on a month-end Destination Ledger will be credited to the Combined Ledger and a negative balance on a month-end Destination Ledger will be debited to the Combined Ledger. By the 10th of each month, Allegiant agrees to provide the City with a copy of the month-end Combined Ledger for the prior month. 9. Revenue Guarantee or Share Payment. At any time, Allegiant may give the City a written request for payment (“Payment Request”) of the Credit balance on the most recent Combined Ledger. At any time, the City may give Allegiant a Payment Request for payment of the Debit balance on the most recent Combined Ledger. The Party receiving the Payment Request shall pay the balance owed on the most recent Combined Ledger to the Party making the request within 30 days from date of receipt of the Payment Request. 10. Indemnity. ---PAGE BREAK--- 8 A. Allegiant agrees to defend, indemnify and hold harmless the City and its respective officers, directors, employees and affiliates from and against any and all claims, damages, liabilities, losses, proceedings, judgments, costs and expenses (including, without limitation, reasonable attorney’s fees) arising solely and directly out of the negligence or misconduct of Allegiant with respect to the operation of the Flights during the term of this Agreement, (ii) breach or non- compliance by Allegiant (during the term of this Agreement) with its obligations under this Agreement, and/or (iii) breach or non-compliance by Allegiant (during the term of this Agreement) with applicable law, rule or regulation pertaining to this Agreement and its performance hereunder. This indemnity shall survive the expiration or termination of this Agreement. B. The City agrees to defend, indemnify and hold harmless Allegiant and its officers, directors, employees and affiliates from and against any and all claims, damages, liabilities, losses, proceedings, judgments, costs and expenses (including without limitation reasonable attorney’s fees) arising solely and directly out of the negligence or misconduct of the City with respect to the Flights during the term of this Agreement, (ii) breach or non-compliance by the City (during the term of this Agreement) with its obligations under this Agreement, and/or (iii) breach or non-compliance by the City (during the term of this Agreement) with applicable law, rule or regulation pertaining to this Agreement and its performance hereunder. This indemnity shall survive the expiration or termination of this Agreement. 11. Force Majeure. Notwithstanding any other provision of this Agreement, the operation of any Flight is subject to, and neither Party shall be liable for, loss, injury, damage or delay in performance of their respective obligation and undertakings hereunder caused by or resulting from any of the following: Act of God; seizure under legal process; sanction; quarantine restriction; fire; fog; flood; weather conditions; unavailability of gate space; airport closure; failure or refusal on the part of any government or governmental agency to timely issue required approvals, clearances, permits or operating authority, or rescission or revocation thereof; damage to or destruction of flight equipment; mechanical difficulties or breakdowns; unavailability of fuel; riots or civil commotions; strikes, lockouts or labor disputes (whether between a Party and its employees or between other parties); U.S. military or airlift emergency, or substantially expanded U.S. military airlift requirement as determined by the U.S. Government, which results in unavailability of aircraft; activation of the U.S. Civil Reserve Air Fleet; war or hLASrd or danger incident to a state of war; or any other act, matter or thing, whether or not of similar nature, beyond the control of a Party and which prevents, delays or interrupts the furnishing, operation or performance of such transportation or hotel accommodation, as applicable to a Party (individually and collectively, force majeure). In the event force majeure causes cancellation of a Flight, Allegiant shall refund to passengers the amount paid to the extent neither the originally-intended nor any alternate transportation is provided to them. Allegiant may, but does not assume the duty to, accommodate passengers affected by a force majeure on another Allegiant flight. In the event, an event of force majeure adversely affects a Party’s performance hereunder for more than thirty (30) consecutive days, the ---PAGE BREAK--- 9 Party whose performance is not affected by such event shall have the right to terminate this Agreement upon written notice to the affected Party. 12. Notices and Communications. All notices, demands, requests, consents and approvals by the parties to this Agreement shall be communicated between Allegiant and the City in writing, and delivered by hand, by reputable overnight courier service, or by electronic transmission; provided, that in the case of delivery by electronic transmission, the communication shall be deemed received only upon written confirmation of delivery, including automated electronic confirmation. All such communications shall be addressed as follows: To Allegiant: Allegiant Air LLC., Attn: Eric Fletcher 1201 N Town Center Drive, Las Vegas NV, 89144 Email Address: [EMAIL REDACTED] With copy to: Allegiant Air LLC., Attn: Keith Hansen 1201 N Town Center Drive, Las Vegas NV, 89144 Email Address: [EMAIL REDACTED] To the City: Attn: Economic Development Director 2549 Washington Blvd, Suite 420 Ogden, Utah 84401 With a copy to: Ogden City Attorney 2549 Washington Blvd, Suite 820 Ogden, Utah 84401 13. Effect of Termination. A. Any termination or expiration of this Agreement shall not affect the parties’ respective rights and obligations which have accrued prior to the effective date of such termination, including, without limitation, the City’s obligation to pay Allegiant all amounts owing to Allegiant or Allegiant’s obligation to pay the City all amounts owing to the City as of the effective date of such expiration or termination; B. In the event of any termination or expiration of this Agreement for any reason, each Party shall pay the other Party all amounts owed by such party as of the effective date of expiration or termination, in accordance with the provisions ---PAGE BREAK--- 10 of this Agreement, within five business days after receipt of an invoice from the other Party entitled to such amounts. 14. Governing Law. Any disputes between the parties hereto with respect to any matters in, arising out of or relating to this Agreement shall be determined in a state or federal court in Utah, USA, and shall be governed by the laws of the State of Utah, USA. Both parties hereby consent irrevocably to the jurisdiction of said courts for said purpose. Each of the parties hereby waives trial by jury in the case of any dispute or litigation commenced between the parties. 15. Waiver of Certain Damages. Except with respect to each Party’s indemnification obligations hereunder, neither Party shall be liable to the other for any special, incidental or consequential damages arising out of this Agreement, even if such Party had been advised of the possibility of such damages. 16. Assignment. No Party may assign this Agreement or any interest herein without obtaining the prior written consent of all of the other parties, except that Allegiant may assign or delegate this Agreement and the rights and obligations created hereunder to any wholly owned subsidiary of Allegiant Travel Company. Also, in the event of operational needs, Allegiant may contract individual flights to another certificated airline, provided that Allegiant does not have one of its own aircraft available due to operational needs, and the certificated airline operates a similar aircraft. The City will not be obligated to pay any additional costs that Allegiant accrues in the process of procuring a replacement aircraft. 17. Entire Agreement and Amendments. This Agreement supersedes all prior communications, agreements, representations and understandings between and among the parties, oral or written, with respect to the same subject matter, and fully sets forth the understanding of the parties. To the extent consistent with this Agreement, the terms, provisions and conditions of Allegiant’s Contract of Carriage as currently published on Allegiant’s website (www.allegiantair.com) are incorporated herein with the same force and effect as if fully set forth herein, and shall be applicable to all passengers who fly on the Flights. This Agreement may not be amended or changed except by written amendment executed by the parties hereto. 18. Expenses. Each Party to this Agreement agrees to be responsible for its own costs, expenses and charges (including, without limitation, legal fees, advisory fees and accounting fees) in connection with the preparation of this Agreement and the transactions contemplated hereunder. 19. Counterparts, Delivery by Facsimile. This Agreement may be executed (by fax or otherwise) in counterparts, each of which shall be deemed an original, and which together shall constitute one instrument. Delivery of an executed counterpart of this Agreement or of any other documents in connection with this Agreement by digital, email or facsimile transmission will be deemed as effective as delivery of an originally executed counterpart. Any Party delivering an executed counterpart of this Agreement or other ---PAGE BREAK--- 11 document by digital, email or facsimile transmission will also deliver an originally executed counterpart, but the failure of any Party to deliver an originally executed counterpart of this Agreement or such other document will not affect the validity or effectiveness of this Agreement or such other document. 20. Severability. If a provision of this Agreement is or becomes illegal, invalid or unenforceable in any jurisdiction, the parties agree to consult each other in good faith for an agreed period of time and to take such reasonable steps as the parties are able to take to mitigate or remove such event or circumstance and further, such illegality, invalidity or unenforceability will not affect the legality, validity or enforceability in that jurisdiction of any other provision of this Agreement or the legality, validity, or enforceability in any other jurisdiction of that or any other provision of this Agreement. 21. Confidentiality. To the fullest extent permitted by law, the parties shall keep the financial terms and all other terms and conditions of this Agreement, strictly confidential and shall not disclose such information to any third party unless required by applicable law, legal process or as may be necessary to enforce, or defend the enforcement of, this Agreement. In addition, each Party (the “Receiving Party”) agrees to hold in strict confidence all confidential and proprietary information, either designated by the Party disclosing such information to the other Party (the “Disclosing Party”) as such or under reasonable circumstances to be considered as such, whether in written, oral or other form, which it received from the Disclosing Party prior to, or in the course of, this Agreement (collectively, "Confidential Information"). Each Party further agrees to use the Confidential Information solely to perform or to exercise its rights under this Agreement, and at a minimum to take all measures necessary to protect against the disclosure or use of the Confidential Information as it takes to protect its own proprietary or confidential information (but in any case no less than reasonable measures). Confidential Information includes, without limitation, the terms of this Agreement, (ii) flight and accommodations booking information related to the Flights, and (iii) revenue amounts, sources, allocations. Either Party may disclose the other Party’s Confidential Information in response to law, regulation, a valid court order or other governmental action, including in response to a request for records under the Utah Government Records Access and Management Act (“GRAMA”) provided that the Disclosing Party is notified in writing prior to disclosure of the information, and the Receiving Party assists the Disclosing Party, at the Disclosing Party’s expense, in any attempt by the other to limit or prevent the disclosure of the Confidential Information. 22. Consents and Approvals. The Parties understand and agree that although this Agreement may be signed by the Ogden City Mayor, the terms and conditions expressed herein may require various procedural notices, approvals, hearings, and studies, and will require the approving action of the Ogden City Council by Resolution. Therefore, this Agreement will not become binding upon the Parties until all terms and conditions expressed herein are approved by the City Council. ---PAGE BREAK--- 12 The next page is the signature page. ---PAGE BREAK--- 13 IN WITNESS WHEREOF, the parties have caused this Agreement to be signed by their duly authorized representatives as of the date first above written. Allegiant Air, LLC: Signed the day of , 2017 By: Title: Signature: Witnessed by Name OGDEN CITY, a municipality and political subdivision of the state of Utah By: Date: Michael P. Caldwell Mayor ATTEST: Tracy Hansen, City Recorder Approved As to Form: Office of City Attorney ---PAGE BREAK--- 14 EXHIBIT (Schedule of Flights) This schedule includes the LAX and LAS flights proposed in this contract, as well as flights to IWA that are not part of this contract. ---PAGE BREAK--- 15 A R R I V A L S D E P A R T U R E S FLT EQP FREQ FRM DPT ARR DPT ARR TO FLT EQP FREQ [OGD] OGDEN, UT SCHEDULE FOR 10/05/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 10/06/17 102 31B 5 IWA 1446 1722 0:40 1802 1836 IWA 103 31B 5 SCHEDULE FOR 10/08/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 10/09/17 102 31B 1 IWA 1446 1722 0:40 1802 1836 IWA 103 31B 1 SCHEDULE FOR 10/12/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 10/13/17 102 31B 5 IWA 1446 1722 0:40 1802 1836 IWA 103 31B 5 SCHEDULE FOR 10/15/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 10/16/17 102 31B 1 IWA 1446 1722 0:40 1802 1836 IWA 103 31B 1 SCHEDULE FOR 10/19/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 10/20/17 102 31B 5 IWA 730 1006 0:40 1046 1120 IWA 103 31B 5 SCHEDULE FOR 10/22/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 10/23/17 102 31B 1 IWA 730 1006 0:40 1046 1120 IWA 103 31B 1 SCHEDULE FOR 10/26/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 10/27/17 [OGD] OGDEN, UT 102 31B 5 IWA 730 1006 0:40 1046 1120 IWA 103 31B 5 SCHEDULE FOR 10/29/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 10/30/17 102 31B 1 IWA 730 1006 0:40 1046 1120 IWA 103 31B 1 SCHEDULE FOR 11/02/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 11/03/17 102 31B 5 IWA 730 1010 0:40 1050 1120 IWA 103 31B 5 SCHEDULE FOR 11/05/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 11/06/17 102 31B 1 IWA 730 910 0:40 950 1120 IWA 103 31B 1 SCHEDULE FOR 11/09/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 11/10/17 102 31B 5 IWA 730 910 0:40 950 1120 IWA 103 31B 5 ---PAGE BREAK--- 16 SCHEDULE FOR 11/12/17 3300 31B 47 LAX 1725 2010 0:40 2050 2135 LAX 3301 31B 47 SCHEDULE FOR 11/13/17 102 31B 1 IWA 730 910 0:40 950 1120 IWA 103 31B 1 SCHEDULE FOR 11/16/17 3300 31B 4 LAX 630 911 0:40 951 1040 LAX 3301 31B 4 SCHEDULE FOR 11/17/17 102 31B 5 IWA 1314 1455 0:40 1535 1708 IWA 103 31B 5 3402 31B 5 LAS 1416 1636 0:40 1716 1736 LAS 3403 31B 5 SCHEDULE FOR 11/19/17 3300 31B 7 LAX 630 911 0:40 951 1040 LAX 3301 31B 7 [OGD] OGDEN, UT SCHEDULE FOR 11/20/17 102 31B 1 IWA 720 901 0:40 941 1114 IWA 103 31B 1 3402 M86 1 LAS 830 1050 0:40 1130 1150 LAS 3403 M86 1 SCHEDULE FOR 11/22/17 3402 M86 3 LAS 840 1100 0:40 1140 1200 LAS 3403 M86 3 102 31B 3 IWA 1445 1626 0:40 1706 1839 IWA 103 31B 3 SCHEDULE FOR 11/23/17 3300 31B 4 LAX 1359 1640 0:40 1720 1809 LAX 3301 31B 4 SCHEDULE FOR 11/26/17 3300 31B 7 LAX 630 911 0:40 951 1040 LAX 3301 31B 7 102 31B 7 IWA 900 1041 0:40 1121 1254 IWA 103 31B 7 3402 31B 7 LAS 1339 1559 0:40 1639 1659 LAS 3403 31B 7 SCHEDULE FOR 11/30/17 3300 31B 4 LAX 630 914 0:40 954 1049 LAX 3301 31B 4 SCHEDULE FOR 12/01/17 102 31B 5 IWA 710 852 0:40 932 1108 IWA 103 31B 5 3402 M86 5 LAS 1217 1437 0:40 1517 1537 LAS 3403 M86 5 SCHEDULE FOR 12/03/17 3300 31B 7 LAX 630 914 0:40 954 1049 LAX 3301 31B 7 SCHEDULE FOR 12/04/17 102 31B 1 IWA 710 852 0:40 932 1108 IWA 103 31B 1 3402 M86 1 LAS 820 1040 0:40 1120 1140 LAS 3403 M86 1 SCHEDULE FOR 12/07/17 3300 31B 4 LAX 630 914 0:40 954 1049 LAX 3301 31B 4 SCHEDULE FOR 12/08/17 102 31B 5 IWA 710 852 0:40 932 1108 IWA 103 31B 5 3402 M86 5 LAS 1212 1432 0:40 1512 1532 LAS 3403 M86 5 SCHEDULE FOR 12/10/17 3300 31B 7 LAX 630 914 0:40 954 1049 LAX 3301 31B 7 [OGD] OGDEN, UT SCHEDULE FOR 12/11/17 102 31B 1 IWA 710 852 0:40 932 1108 IWA 103 31B 1 3402 M86 1 LAS 840 1100 0:40 1140 1200 LAS 3403 M86 1 SCHEDULE FOR 12/14/17 3300 31B 4 LAX 630 914 0:40 954 1049 LAX 3301 31B 4 SCHEDULE FOR 12/15/17 102 31B 5 IWA 710 852 0:40 932 1108 IWA 103 31B 5 3402 31B 5 LAS 1212 1432 0:40 1512 1532 LAS 3403 31B 5 SCHEDULE FOR 12/17/17 3300 31B 7 LAX 630 914 0:40 954 1049 LAX 3301 31B 7 SCHEDULE FOR 12/18/17 102 31B 1 IWA 710 852 0:40 932 1108 IWA 103 31B 1 3402 M86 1 LAS 900 1120 0:40 1200 1220 LAS 3403 M86 1 SCHEDULE FOR 12/21/17 3300 31B 4 LAX 630 914 0:40 954 1049 LAX 3301 31B 4 ---PAGE BREAK--- 17 SCHEDULE FOR 12/22/17 102 31B 5 IWA 710 852 0:40 932 1108 IWA 103 31B 5 3402 M86 5 LAS 835 1055 0:40 1135 1155 LAS 3403 M86 5 SCHEDULE FOR 12/24/17 3300 31B 7 LAX 630 914 0:40 954 1049 LAX 3301 31B 7 SCHEDULE FOR 12/25/17 102 31B 1 IWA 1013 1155 0:40 1235 1411 IWA 103 31B 1 SCHEDULE FOR 12/26/17 3402 M86 2 LAS 831 1051 0:40 1131 1151 LAS 3403 M86 2 SCHEDULE FOR 12/28/17 3300 31B 4 LAX 630 914 0:40 954 1049 LAX 3301 31B 4 SCHEDULE FOR 12/29/17 102 31B 5 IWA 710 852 0:40 932 1108 IWA 103 31B 5 3402 M86 5 LAS 835 1055 0:40 1135 1155 LAS 3403 M86 5 [OGD] OGDEN, UT SCHEDULE FOR 12/31/17 3300 31B 7 LAX 630 914 0:40 954 1049 LAX 3301 31B 7 SCHEDULE FOR 01/01/18 102 31B 1 IWA 1013 1155 0:40 1235 1411 IWA 103 31B 1 SCHEDULE FOR 01/02/18 3402 31B 2 LAS 825 1045 0:40 1125 1145 LAS 3403 31B 2 SCHEDULE FOR 01/04/18 3300 31B 4 LAX 630 917 0:40 957 1050 LAX 3301 31B 4 SCHEDULE FOR 01/05/18 102 31B 5 IWA 710 853 0:40 933 1110 IWA 103 31B 5 3402 M86 5 LAS 1222 1442 0:40 1522 1542 LAS 3403 M86 5 SCHEDULE FOR 01/07/18 3300 31B 7 LAX 630 917 0:40 957 1050 LAX 3301 31B 7 SCHEDULE FOR 01/08/18 102 31B 1 IWA 710 853 0:40 933 1110 IWA 103 31B 1 3402 M86 1 LAS 827 1047 0:40 1127 1147 LAS 3403 M86 1 SCHEDULE FOR 01/11/18 3300 31B 4 LAX 630 917 0:40 957 1050 LAX 3301 31B 4 SCHEDULE FOR 01/12/18 102 31B 5 IWA 710 853 0:40 933 1110 IWA 103 31B 5 3402 31B 5 LAS 1222 1442 0:40 1522 1542 LAS 3403 31B 5 SCHEDULE FOR 01/14/18 3300 31B 7 LAX 630 917 0:40 957 1050 LAX 3301 31B 7 SCHEDULE FOR 01/15/18 102 31B 1 IWA 710 853 0:40 933 1110 IWA 103 31B 1 3402 M86 1 LAS 827 1047 0:40 1127 1147 LAS 3403 M86 1 SCHEDULE FOR 01/18/18 3300 31B 4 LAX 630 917 0:40 957 1050 LAX 3301 31B 4 [OGD] OGDEN, UT SCHEDULE FOR 01/19/18 102 31B 5 IWA 710 853 0:40 933 1110 IWA 103 31B 5 3402 31B 5 LAS 1222 1442 0:40 1522 1542 LAS 3403 31B 5 SCHEDULE FOR 01/21/18 3300 31B 7 LAX 630 917 0:40 957 1050 LAX 3301 31B 7 SCHEDULE FOR 01/22/18 102 31B 1 IWA 710 853 0:40 933 1110 IWA 103 31B 1 3402 M86 1 LAS 827 1047 0:40 1127 1147 LAS 3403 M86 1 SCHEDULE FOR 01/25/18 3300 31B 4 LAX 630 917 0:40 957 1050 LAX 3301 31B 4 ---PAGE BREAK--- 18 SCHEDULE FOR 01/26/18 102 31B 5 IWA 710 853 0:40 933 1110 IWA 103 31B 5 3402 31B 5 LAS 1222 1442 0:40 1522 1542 LAS 3403 31B 5 SCHEDULE FOR 01/28/18 3300 31B 7 LAX 630 917 0:40 957 1050 LAX 3301 31B 7 SCHEDULE FOR 01/29/18 102 31B 1 IWA 710 853 0:40 933 1110 IWA 103 31B 1 3402 M86 1 LAS 827 1047 0:40 1127 1147 LAS 3403 M86 1 SCHEDULE FOR 02/01/18 3300 31B 4 LAX 630 917 0:40 957 1057 LAX 3301 31B 4 SCHEDULE FOR 02/02/18 102 31B 5 IWA 710 855 0:40 935 1109 IWA 103 31B 5 3402 M86 5 LAS 1209 1429 0:40 1509 1529 LAS 3403 M86 5 SCHEDULE FOR 02/04/18 3300 31B 7 LAX 630 917 0:40 957 1057 LAX 3301 31B 7 SCHEDULE FOR 02/05/18 102 31B 1 IWA 710 855 0:40 935 1109 IWA 103 31B 1 3402 31B 1 LAS 825 1045 0:40 1125 1145 LAS 3403 31B 1 SCHEDULE FOR 02/08/18 3300 31B 4 LAX 630 917 0:40 957 1057 LAX 3301 31B 4 [OGD] OGDEN, UT SCHEDULE FOR 02/09/18 102 31B 5 IWA 710 855 0:40 935 1109 IWA 103 31B 5 3402 M86 5 LAS 1209 1429 0:40 1509 1529 LAS 3403 M86 5 SCHEDULE FOR 02/11/18 3300 31B 7 LAX 630 917 0:40 957 1057 LAX 3301 31B 7 SCHEDULE FOR 02/12/18 102 31B 1 IWA 710 855 0:40 935 1109 IWA 103 31B 1 3402 31B 1 LAS 825 1045 0:40 1125 1145 LAS 3403 31B 1 ---PAGE BREAK--- 19 EXHIBIT “B - LAX” (Spreadsheet – Revenue Guarantee & Share) LAX-OGD If the total revenue per one-way departure is less than: 12,805 $ OGD pays Allegiant the lesser of: 100% of the shortfall. 40% of $12,805, which is: 5,122 $ If the total revenue per one-way departure is greater than: 19,207 $ Allegiant pays OGD 40% of the excess. Example: OGD pays Allegiant pays Total Revenue per Departure per Departure Maximum Annual Liability* per Departure Maximum Annual Liability* 0 5,122 1,065,336 0 0 1,000 5,122 1,065,336 0 0 2,000 5,122 1,065,336 0 0 3,000 5,122 1,065,336 0 0 4,000 5,122 1,065,336 0 0 5,000 5,122 1,065,336 0 0 6,000 5,122 1,065,336 0 0 7,000 5,122 1,065,336 0 0 8,000 4,805 999,339 0 0 9,000 3,805 791,339 0 0 10,000 2,805 583,339 0 0 11,000 1,805 375,339 0 0 12,000 805 167,339 0 0 13,000 0 0 0 0 14,000 0 0 0 0 15,000 0 0 0 0 16,000 0 0 0 0 17,000 0 0 0 0 18,000 0 0 0 0 19,000 0 0 0 0 20,000 0 0 317 65,997 21,000 0 0 717 149,197 22,000 0 0 1,117 232,397 23,000 0 0 1,517 315,597 24,000 0 0 1,917 398,797 25,000 0 0 2,317 481,997 * Maximum Annual Liability based on 208 departures per year. ---PAGE BREAK--- 20 EXHIBIT LAS” (Spreadsheet – Revenue Guarantee & Share) LAS-OGD If the total revenue per one-way departure is less than: 9,099 $ OGD pays Allegiant the lesser of: 100% of the shortfall. 60% of $9,099, which is: 5,459 $ If the total revenue per one-way departure is greater than: 13,648 $ Allegiant pays OGD 60% of the excess. Example: OGD pays Allegiant pays Total Revenue per Departure per Departure Maximum Annual Liability* per Departure Maximum Annual Liability* 0 5,459 1,135,540 0 0 1,000 5,459 1,135,540 0 0 2,000 5,459 1,135,540 0 0 3,000 5,459 1,135,540 0 0 4,000 5,099 1,060,567 0 0 5,000 4,099 852,567 0 0 6,000 3,099 644,567 0 0 7,000 2,099 436,567 0 0 8,000 1,099 228,567 0 0 9,000 99 20,567 0 0 10,000 0 0 0 0 11,000 0 0 0 0 12,000 0 0 0 0 13,000 0 0 0 0 14,000 0 0 211 43,890 15,000 0 0 811 168,690 16,000 0 0 1,411 293,490 17,000 0 0 2,011 418,290 18,000 0 0 2,611 543,090 19,000 0 0 3,211 667,890 20,000 0 0 3,811 792,690 21,000 0 0 4,411 917,490 22,000 0 0 5,011 1,042,290 23,000 0 0 5,611 1,167,090 24,000 0 0 6,211 1,291,890 25,000 0 0 6,811 1,416,690 * Maximum Annual Liability based on 208 departures per year. ---PAGE BREAK--- 21 EXHIBIT OAK” (Spreadsheet – Revenue Guarantee & Share) OAK-OGD If the total revenue per one-way departure is less than: 12,678 $ OGD pays Allegiant the lesser of: 100% of the shortfall. 50% of $12,678, which is: 6,339 $ If the total revenue per one-way departure is greater than: 18,112 $ Allegiant pays OGD 50% of the excess. Example: OGD pays Allegiant pays Total Revenue per Departure per Departure Maximum Annual Liability* per Departure Maximum Annual Liability* 0 6,339 1,318,537 0 0 1,000 6,339 1,318,537 0 0 2,000 6,339 1,318,537 0 0 3,000 6,339 1,318,537 0 0 4,000 6,339 1,318,537 0 0 5,000 6,339 1,318,537 0 0 6,000 6,339 1,318,537 0 0 7,000 5,678 1,181,074 0 0 8,000 4,678 973,074 0 0 9,000 3,678 765,074 0 0 10,000 2,678 557,074 0 0 11,000 1,678 349,074 0 0 12,000 678 141,074 0 0 13,000 0 0 0 0 14,000 0 0 0 0 15,000 0 0 0 0 16,000 0 0 0 0 17,000 0 0 0 0 18,000 0 0 0 0 19,000 0 0 444 92,376 20,000 0 0 944 196,376 21,000 0 0 1,444 300,376 22,000 0 0 1,944 404,376 23,000 0 0 2,444 508,376 24,000 0 0 2,944 612,376 25,000 0 0 3,444 716,376 * Maximum Annual Liability based on 208 departures per year. ---PAGE BREAK--- 22 EXHIBIT SFB” (Spreadsheet – Revenue Guarantee & Share) SFB-OGD If the total revenue per one-way departure is less than: 48,561 $ OGD pays Allegiant the lesser of: 100% of the shortfall. 50% of $48,561, which is: 24,280 $ If the total revenue per one-way departure is greater than: 69,373 $ Allegiant pays OGD 50% of the excess. Example: OGD pays Allegiant pays Total Revenue per Departure per Departure Maximum Annual Liability* per Departure Maximum Annual Liability* 0 24,280 5,050,318 0 0 5,000 24,280 5,050,318 0 0 10,000 24,280 5,050,318 0 0 15,000 24,280 5,050,318 0 0 20,000 24,280 5,050,318 0 0 25,000 23,561 4,900,636 0 0 30,000 18,561 3,860,636 0 0 35,000 13,561 2,820,636 0 0 40,000 8,561 1,780,636 0 0 45,000 3,561 740,636 0 0 50,000 0 0 0 0 55,000 0 0 0 0 60,000 0 0 0 0 65,000 0 0 0 0 70,000 0 0 314 65,260 75,000 0 0 2,814 585,260 80,000 0 0 5,314 1,105,260 85,000 0 0 7,814 1,625,260 90,000 0 0 10,314 2,145,260 95,000 0 0 12,814 2,665,260 100,000 0 0 15,314 3,185,260 105,000 0 0 17,814 3,705,260 110,000 0 0 20,314 4,225,260 115,000 0 0 22,814 4,745,260 120,000 0 0 25,314 5,265,260 125,000 0 0 27,814 5,785,260 * Maximum Annual Liability based on 208 departures per year.