AIRCRAFT JOINT OWNERSHIP AGREEMENT A. Introductory Recitals 1. Formation This Agreement is entered into as of the last date set forth below by the undersigned parties ("the parties"). This Agreement is intended to be performed in the and the laws of this relating to the operation of partnerships generally shall govern its interpretation and effect. 2. Purpose The purpose of this Agreement is to provide for the ownership, operations, maintenance, and disposition of an airplane known as a , bearing aircraft registration number and the manufacturer's serial number ("the aircraft"). The parties intend to hold this property for their personal use and enjoyment and wish to have an agreement by which their respective rights, obligations, and responsibilities are governed. 3. Commencement and Terms This Agreement shall commence as of the date of endorsement of the parties and shall continue indefinitely, until terminated by agreement of the parties, by at least sixty (60) days written notice given by any of the parties to the others, or under the conditions set forth below. B. Contributions 1. Initial Each party shall have a one-third (1/3 or 33.33%) interest in the airplane. These contributions are in the form of cash, promissory notes, current interest in the aircraft, or combinations thereof. 2. On-going Subsequent contributions for fixed, hourly, and unexpected costs as outlined below shall be made to a bank account maintained exclusively for this purpose. C. Management, Operation and Maintenance 1. Acts Requiring Unanimous Consent The following acts shall be done only with the unanimous consent of the parties: a. Sales. Selling or entering into a contract to sell any jointly owned property. b. Pledges Encumbering or otherwise hypothecating any jointly owned property or entering into any contract for such purpose. c. Liens Knowingly suffering or causing anything to be done whereby jointly owned property may be seized or attached or taken in execution, or its ownership or possession otherwise endangered. d. Expenditures Making or authorizing any expenditure (excepting required annual inspections) for the benefit of the parties in excess of five hundred dollars ($500). e. Base of Operation Changing the base of operations from the field where the aircraft is currently based. f. Other actions as may be stipulated in this Agreement as requiring the unanimous consent of the parties. 2. Operation and Maintenance a. Use Restrictions The parties agree that the aircraft has been purchased solely for their private, non-commercial use, and that the aircraft will not be used for lease-back, air taxi, or charter purposes. The aircraft may also be used for flight instruction by a approved Flight Instructor for the purpose of maintaining the currency or upgrading the ratings of the parties or named insured. Parties may, however, charge passengers for gas and oil, as well as tie- down and other ground charges incurred while traveling, providing the non-ground portion of such charges does not exceed the current hourly flight charge. b. Pilots The aircraft will not be operated unless one of the parties is aboard in the capacity of Pilot in Command, except for: (i) A duly licensed mechanic, where such operation is required as part of the repair and maintenance of the aircraft. (ii) Anyone with the unanimous consent of the parties and who is also specifically authorized on all applicable aircraft insurance policies. (iii) A approved Flight Instructor when instructing one of the parties or named insured provided that said instructor is covered for this purpose by all applicable aircraft insurance policies. c. Aircraft Equipment All equipment required by applicable Air Regulations for flight under day and night, VFR and IFR conditions, for flight into Terminal Control Areas and for flight into all other controlled civil airspace up to, but not including, 18,000 feet MSL, will be installed and maintained in good operating condition. d. Aircraft Condition The parties agree to maintain the aircraft in an airworthy condition suitable for day and night, VFR and IFR flight, and to comply with all normal pre-flight, operational and post-flight requirements. After each use, the party using the aircraft will ensure that gust locks and sun screens are installed, seat belts are secured, trash is removed, and the cabin door and baggage compartment are locked. Additionally, he will make arrangements for topping off all fuel tanks, bringing the oil level to a minimum of five (5) quarts, and for tieing down the aircraft. Each party will report to the others all conditions and circumstances which have caused damage to the aircraft or which may subsequently have an impact on its operation including, without limitation, any unusual air turbulence, hard landings, or ground incidents. e. Normal Expenses The parties agree that they will share equally for the expenses incurred in the normal day-to-day operation and maintenance of the aircraft; provided, that each party shall be solely responsible for any incidental ground charges during his operation of the aircraft. f. Fixed Expenses The parties agree to share equally for all yearly fixed expenses such as tie-down fee, insurance premiums, property taxes and fees for annual inspections. These fixed costs will be pro-rated to a monthly basis and this monthly cost will be shared equally by all parties with contributions to the aircraft bank account. The monthly cost shall be determined at the beginning of each calendar year but may be changed with the unanimous consent of the parties. Payments of fixed and hourly expenses shall be due by the 5th day of each calendar month for fees accumulated from the prior month. g. Unplanned Expenses The parties agree to share equally for all unexpected expenses including, without limitation: (i) Airworthiness Directives. (ii) Equipment damage due to mechanical failure. (iii) Damage from any cause while secured in its permanent tie-down spot. (iv) Other unscheduled maintenance. However, each party reserves the right to liquidate his interest as outlined below in lieu of encumbering further costs. h. Hourly Contribution Each party agrees to make an additional contribution to the aircraft bank account at the rate of for each tachometer hour that the aircraft is used by that party. Said amount as accumulated shall be used for expenses incurred for routine maintenance, inspections, fuel, oil, and repairs and replacements to the aircraft. Pilots not party to this Agreement who operate the aircraft under the provisions of section C.2.b.(ii) shall be requested to contribute to the aircraft bank account at the rate of for each tachometer hour that the aircraft is used by them. i. Inspections Regular annual inspections will be carried out automatically. j. Insurance Hull and liability insurance for the aircraft shall be continuously maintained. The amount of hull insurance shall be at least equal to the current valuation as determined by the procedures set forth in section D.4. The amount of liability insurance shall be at least per incident/accident. k. Liability for Damage Insofar as the deductible portion of the insurance is concerned, damage due to any cause other than those outlined in section C.2.g will be the responsibility of the party having control of the aircraft at the time of the damage. l. Smoking No smoking will be allowed in the aircraft. m. Additional Equipment Additional equipment may be added to the aircraft with the unanimous consent of the parties. The cost of this additional equipment and its installation shall be shared equally by the parties. If the parties are unable to agree upon the addition of equipment, any party may add such other equipment as desired, and pay the cost of such equipment and its installation. In this event, one-third of the cost of the equipment, plus installation, shall be credited to the purchasing party upon liquidation, regardless of its then depreciated value. This shall not apply to materials or labor expended for maintenance, repair or replacement of equipment necessary to keep the aircraft in substantially the same condition as on its acquisition. n. Rules and Regulations The aircraft shall at all times be flown and maintained in accordance with all applicable Air Regulations and requirements of duly constituted authority. Any deficiencies resulting therefrom which cause any civil penalties to be levied, shall be borne by the party or parties responsible for the violation. In the event that the violation is not directly attributable to the responsibility of one or more of the parties, the cost shall be shared equally by the parties. o. Delinquencies Any delinquency in the payment of charges, costs or fees arising out of the terms of this agreement, whether for fixed, operating or unplanned expenses, or otherwise, which are delinquent for more than thirty (30) days, shall result in the deprivation of flight privileges of the delinquent party. Any delinquency which continues thereafter for an additional sixty (60) days, shall be grounds for involuntary liquidation of the delinquent party's interests at the option of the non-delinquent parties. p. Lien on Liquidation Any just charges owed by one party to the others shall become a lien upon the interest of the party indebted, and shall be satisfied out of the proceeds of sale upon liquidation. 3. Scheduling a. Equal Access The parties agree that each shall have an equal opportunity to use the aircraft. b. Week Day Scheduling Week days shall consist of Monday through Thursday. The parties agree that the aircraft will be available on a "first-come, first-serve" basis on week days. The parties agree that they may reserve week days in advance of use with the other parties. No member shall reserve the aircraft for more than one-third of the available week days in a year. c. Weekend Scheduling Weekends shall consist of Friday through Sunday. The parties agree that the aircraft will be available on weekends by reserving the aircraft in advance of use with the other parties. No member shall reserve the aircraft for more than one-third of the available weekends in a year. If no party has reserved the aircraft for a given weekend then the aircraft shall be available as specified for week days. d. Travel Restrictions The aircraft may be taken to any country in the Western Hemisphere north of Panama, but the party using the aircraft will be required to make hull and liability insurance arrangements equivalent to those carried in the . However, travel to any country south of and including Mexico shall require the unanimous consent of the parties. The aircraft will not be taken to countries for which the does not approve passports. e. Multi-Day Travel Each party agrees to notify the others in the event he will have the aircraft away from its base of operations more than seventy-two (72) consecutive hours. Where feasible, such notice shall be given prior to departure; and where not feasible, each party agrees to make reasonable efforts to notify the others as soon as he determines that the plane will, in fact, be out of the area more than seventy-two (72) hours. D. Changes in Ownership 1. Prohibited Transfers Except as provided below, a party's interest in the aircraft shall not be transferred, in whole or in part, except by succession of testamentary disposition on the party's death, and any purported transfer of all or any part of a party's interest shall be void and of no effect against the other parties, any creditor of the other parties, or claimant against the other parties. 2. Right of First Refusal If any party receives an offer, whether or not solicited by him to purchase all of his interest in the aircraft, and if he is willing to accept it, he may transfer the interest specified in the offer only after he has afforded the other parties the following rights of first refusal: a. Notification of Pending Transfer The party desiring to make the transfer must first notify the other parties in writing of the interest he proposes to transfer, the price and terms on which it is proposed to be transferred, and the identity of the proposed transferee. b. Options to Purchase Any of the other parties shall have the option to purchase that interest from him at the price equal to the lesser of: (i) The value, as of the date the notice of the proposed transfer is given, of the interest computed under section D.4 of this Agreement. (ii) The same price and on the same terms as those specified in the notice of the proposed transfer. The option to purchase the interest or portion shall be exercised by written notice from any of the other parties within twenty (20) days after they have received notice of the proposed transfer. c. Transfer to Outside Party If the other parties do not exercise their option to purchase the interest within the time provided, the party proposing to transfer his interest may then at any time within ninety (90) days following the expiration of the twenty (20) day period first referred to, transfer his specified interest to the transferee specified in the notice on the same terms and at no less than the price stated in the notice. Such a sale shall be made only to a person who is then a duly licensed pilot and is then qualified to operate the aircraft, or to a person who can become so qualified within thirty (30) days after the transfer. d. Unacceptable Transfer Notwithstanding the foregoing, a party who does not consent to the proposed transfer may give immediate notice of his intent to terminate the Agreement, in which case (unless the parties otherwise agree) the aircraft shall be sold and the proceeds divided in accordance with this Agreement. 3. Transfers on Death Upon the death of any party, the remaining parties shall have the option to purchase the ownership interest of the deceased party at a price to b e agreed upon by the surviving parties and the deceased party's personal representative; and in the event they are unable to agree, then the deceased party's interest shall be determined as set forth below. 4. Aircraft Valuation The value of a party's interest for purposes of this Agreement shall be based on the value of the aircraft itself, which shall be determined as follows: a. Within ninety (90) days after the end of each calendar year the parties shall, after due consideration of all factors they deem relevant, determine the aircraft's value by unanimous written agreement, and that value shall remain in effect for purposes of this Agreement from the date of that determination until the next such written determination, except as otherwise provided below. The valuation shall be entered in Exhibit "A" and all parties shall initial the entry. b. If the parties are unable to agree on a value or otherwise unable to make such determination, the value shall be the greater of the value last established under this section or the value of the aircraft as set forth in the "aircraft bluebook." c. Until it is otherwise determined under this section, the aircraft's value shall be the sum of . 5. Rights of Heirs In the event the surviving parties shall fail to exercise the option granted them in section D.3, then the decedent's interest in the aircraft shall pass by succession or according to the testamentary disposition made by the decedent. 6. Manner of Payment Whenever a party, having the right to do so, chooses to purchase another party's interest, he shall pay for that interest in such a manner and upon such terms as the parties shall agree; and if the parties are unable to agree, then he shall pay in cash within sixty (60) days after exercise of his option. E. Miscellaneous Provisions 1. Indemnification Each party shall indemnify and hold harmless the others from any and all expense and liability resulting from or arising out of any negligence or misconduct on his part to the extent that the amount exceeds the applicable insurance carried by the joint owners. 2. Amendments This Agreement may be amended at any time and from time to time, but any amendment must be in writing and signed by each person who is then a party to the Agreement. 3. Notices Any written notice to any of the parties required or permitted under this Agreement shall be deemed to have been duly given on the date of service if served personally on the party to whom notice is to be given, or on the third day after mailing if mailed to the party to whom the notice is to be given, first class, certified, return receipt requested, postage prepaid, and addressed to the addressee at the address stated opposite his name below, or at the most recent address, specified by written notice, given to the sender by the addressee under this provision. 4. Counterparts The parties may execute this Agreement in two or more counterparts, which shall, in the aggregate, be signed by all the parties; each counterpart shall be deemed an original instrument as against any party who has signed it. 5. Agreement Binding on Successors This Agreement shall be binding on and inure to the benefit of the respective successor, assigns, and personal representatives of the parties, except to the extent of any contrary provision in this Agreement. 6. Unenforceability If any term, provision, covenant, or condition of the Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the rest of the Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated. 7. Pronouns As used in this Agreement, the masculine, feminine, or neuter gender and the singular or plural numbers shall each be deemed to include the others whenever the context so indicates. 8. Attorney's Fees In the event of any dispute under this Agreement, or the default by any party of that party's obligations hereunder, then the prevailing parties shall be entitled to recover, in addition to all others sums which may be due under the terms of the Agreement, all costs of suit, including reasonable attorney's fees. 9. Entire Agreement This instrument contains the entire agreement of the parties relating to the right granted and obligations assumed in this instrument and supersedes any prior agreements between the parties. Any oral representations or modifications concerning this instrument shall be of no force or effect unless contained in a subsequent written modification signed by the parties to be charged. In witness whereof, the parties have executed this Agreement on at . _____________________________ _____________________________ _____________________________