and illustrated on Exhibit B, and such invoice shall set forth the payments due and

contained therein to the Authority from the Airline. 2.3 Fines Upon demand from the Authority and within ten (10) business days, an Airline shall pay any and all fines assessed by the Authority on such Airline or the Airline's employees for violations of any of the (i) Terms and Conditions or (ii) Airport Rules and Regulations. 2.4 Additional Payments Upon demand from the Authority and within ten (10) business days, an Airline shall pay any other charges not already covered by the payments made in accordance with Sections 2.1 and 2.2 above, which are related or incidental to such Airline's use and occupancy of any Regional Airport. Any such assessment shall be substantially similar to the rates, fees, and charges imposed on other air carriers that make similar use of the Regional Airports, subject to reasonable classification. 2.5 Late Payments In the event that any payment required to be made under the Terms and Conditions is not paid in full when due, the Airline shall pay interest on such overdue and unpaid amount at the rate of one and one-half (1-1/2%) percent per month, commencing on the date such payment was due. 2.6 Security Deposit A. Unless Airline makes cash payments to the Authority concurrent with its operations at one or more Regional Airport, then, prior to the commencement of such Airline's operations at such Regional Airport(s), the Airline shall deposit a security deposit (the "Security Deposit") with the Authority. The Security Deposit shall be in the form of a bond, letter of credit from a bank reasonably acceptable to the Authority, or cash, in an amount equal to three (3) months of estimated fees due to the Authority from the Airline pursuant to Section 2.2 hereof. The Security Deposit shall be held as security for the full and faithful performance of every provision of these Terms and Conditions by the Airline. In the event that the Airline obtains a {A0081207.2} letter of credit as its Security Deposit, the letter of credit shall be in the form attached hereto as Exhibit A. B. If an Airline fails to comply with any of the Terms and Conditions, the Authority may use, apply or retain all or any part of the Security Deposit for the payment of any fee or charge, or for the payment of any other amount which the Authority may spend or become obligated to spend by reason of such Airline's failure to comply or failure to compensate the Authority for any loss, cost or damage which the Authority may suffer by reason of such failure to comply. If any portion of said Security Deposit is so used or applied, the Airline shall, within ten (10) business days after written demand therefore, restore the Security Deposit to the amount required under this Section. The Authority shall not be required to keep the Security Deposit separate from its general funds, and the Airline shall not be entitled to interest on such Security Deposit. Upon termination of an Airline's operations at a Regional Airport, the Security Deposit or any balance thereof shall be returned to such Airline within a reasonable time after the complete termination of the Airline's operations at such Regional Airport, provided, however, that the Authority may retain the Security Deposit until such time as any amount due from the Airline for all fees and charges for its operations at such Regional Airport has been determined and paid in full. An Airline shall not assign nor encumber its contingent rights in the Security Deposit, nor shall the Authority or its successors or assigns be bound by any such assignment or encumbrance. 2.7 No Abatement An Airline shall pay all fees, charges and other payments due hereunder without notice, demand, abatement, deduction or offset. 2.8 Passenger Facility Charges The Authority expressly reserves the right to impose or continue to impose PFCs on airline passengers for the use of each Regional Airport in accordance with 49 U.S.C. § 40117 and applicable implementing regulations adopted by the FAA, 14 CFR Part 158, as they may be amended from time to time (the "PFC Regulations"). Each Airline shall hold in trust for the Authority the net principal amount of all PFCs that are collected by the Airline or its agents on behalf of the Authority. For the purposes of this Section 2.8, net principal amount shall mean the total principal amount of all PFCs that are collected by the Airline or its agents on behalf of the Authority, reduced by any amount that the Airline is permitted to retain pursuant to 49 U.S.C. § 40117 and the PFC Regulations. PFCs collected by the Airline shall be remitted to the Authority. If the Airline fails to remit the net principal amount of all PFCs to the Authority within the time limits established by the PFC Regulations, the Airline shall be deemed to be in breach of the Terms and Conditions. In addition, any late payment of PFCs shall be subject to late fees computed at the rate of the lower of one and one-half percent (1.5%) per month or the highest rate allowable under applicable law from the due date until paid. Nothing contained herein shall be construed to supercede the rights and obligations provided in 14 CFR Part 158 regarding Passenger Facility Charges. In the event that a conflict exists between such federal regulation and the Terms and Conditions, the federal regulation shall govern. [A0081207.2 }