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Airline Agreements 5 Sky Team and Star Alliance). Some agreements contain a specific reference to the code share rela- tionship by including a definition of "Partner" to cover the method of counting the code share carrier's operations for purposes of gate allocations. See CRP-CD-81 (enclosed herein), Appendix to Chapter 1, Airline Agreements, for excerpts from the STL Airline Agreement for provisions regarding definition and treatment of alliance partners. 1.7 Vacancy Risk Vacancy risk is becoming of increasing importance to airports as airlines adjust space needs due to mergers and economic vagaries. Airport agreements address the risk of space vacancy in several ways. Residual agreements cover the risk of vacant space via the methodology of calcu- lating rates by netting revenues from expenses and then dividing the net by an airline-leased space denominator. Compensatory and commercial compensatory agreements generally do not recover vacancy costs because the denominator used in calculating rates is leasable space and the airport thereby bears the risk of unleased space. One way that airports can mitigate vacancy risk is to create an additional weighted space category and allocate fewer operating and maintenance expenses to that space category given that vacant space does not require as much O&M costs. 1.8 Privileges Granted Most airline agreements have lengthy and detailed descriptions of the privileges granted to the signatory. These include the right to operate its flights, repair aircraft, sell tickets, train personnel, purchase fuel, service equipment, operate radio and other communications, sell or exchange equipment and products, operate VIP clubs, handle or be handled by other airlines or entities, and prepare and distribute food and beverages (with limitations). There is normally a blanket statement preceding the specific delineation of privileges that grants the airline the right to oper- ate its air transportation business at the airport followed by a caveat that nothing be construed as granting airline the right to operate a business separate from the operation of the air transporta- tion business. See CRP-CD-81 (enclosed herein), Appendix to Chapter 1, Airline Agreements, for excerpts from the STL, MWAA, PDX, PIT, and BWI Airline Agreements for provisions regarding the rights granted to airlines for operations at the respective airport. Most agreements exclude certain activities from airline rights and privileges. These prohibitions often include the right to · Sell food and beverages in the airport, except in VIP rooms. (The sale in VIP rooms is commonly restricted to food provided by a vendor having a contract with the airport. The same source restriction generally applies to food purchased for sale onboard aircraft.) · Install pay phones. · Install internet or wireless connectivity. (However, there is a trend toward permitting such installation in exclusive space.) · Land aircraft that exceed the design strength/capacity of the airport. · Install cash machines. · Install advertising. · Enter into any agreement with any entity providing goods and services that does not have an agreement with the airport.