RENTAL CAR CONCESSION AGREEMENT - City of · PDF fileWHEREAS, as a result of the recent...

RENTAL CAR CONCESSION AGREEMENT

CITY OF PHOENIX AVIATION DEPARTMENT


Contract No.

BETWEEN

THE CITY OF PHOENIX, A MUNICIPAL CORPORATION

AND

___________________________, AS CONTRACTING ENTITY

OPERATING

BRAND NAME AND BRAND NAME2

James E. Bennett Aviation Director 2485 East Buckeye Road Phoenix, AZ 85034-4420 (602) 273-3321

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RENTAL CAR CONCESSION AGREEMENT TABLE OF CONTENTS

(To be updated prior to execution of Agreement)

ARTICLE ONE – DEFINITIONS ................................................................................................................... 4

1.1 AIRPORT ...................................................................................................................................... 4 1.2 CITY OF PHOENIX....................................................................................................................... 4 1.3 CONTRACT YEAR ....................................................................................................................... 4 1.4 CUSTOMER FACILITY CHARGE ................................................................................................ 4 1.5 CUSTOMER FACILITY CHARGE ORDINANCE ......................................................................... 4 1.6 DATE OF VENEFICIAL OCCUPANCY ........................................................................................ 4 1.7 DIRECTOR ................................................................................................................................... 4 1.8 ELIGIBLE DEPOSITORY ............................................................................................................. 4 1.9 OPERATOR .................................................................................................................................. 4 1.10 PRORATED CONTRACT YEAR .................................................................................................. 4 1.11 RENTAL CAR CENTER ............................................................................................................... 4 1.12 RCC LEASE .................................................................................................................................. 5 1.13 TRUST INDENTURE .................................................................................................................... 5 1.14 TRUSTEE ..................................................................................................................................... 5 1.15 VEHICLE ....................................................................................................................................... 5

ARTICLE TWO – TERM ............................................................................................................................... 5 2.1 COMMENCEMENTS AND EXPIRATION .................................................................................... 5 2.2 HOLDOVER .................................................................................................................................. 5

ARTICLE THREE – CONSIDERATION ....................................................................................................... 6 3.1 CONCESSION FEE ...................................................................................................................... 6 3.2 GROSS REVENUE....................................................................................................................... 6 3.3 DIVERSION OF VEHICLE RENTAL REVENUE .......................................................................... 7 3.4 CONCESSION RECOVERY FEE ................................................................................................ 7 3.5 CUSTOMER FACILITY CHARGE ................................................................................................ 7 3.6 MINIMUM ANNUAL GUARANTEE ............................................................................................... 8 3.7 TAXES AND OTHER EXACTIONS .............................................................................................. 8 3.8 TIME AND MANNER OF PAYMENT ............................................................................................ 8 3.9 BOOKS AND RECORDS ............................................................................................................. 9 3.10 ANNUAL STATEMENT OF GROSS REVENUE ........................................................................ 10 3.11 AUDIT ......................................................................................................................................... 11

ARTICLE FOUR – USE .............................................................................................................................. 11 4.1 USES PERMITTED .................................................................................................................... 11 4.2 RCC LEASE ................................................................................................................................ 11 4.3 STANDARDS OF SERVICE ....................................................................................................... 12 4.4 COMPLAINTS ............................................................................................................................. 13 4.5 OPERATING HOURS ................................................................................................................. 13 4.6 PERMITS AND VEHICLE REGISTRATION ............................................................................... 13

ARTICLE FIVE – TRANSPORTATION ...................................................................................................... 14 5.1 COMMON TRANSPORTATION SYSTEM ................................................................................. 14 5.2 COMMON BUSING Operator ..................................................................................................... 14 5.3 AUTOMATED PEOPLE MOVER SYSTEM ................................................................................ 14 5.4 HANDICAP AND SPECIAL NEEDS TERMINAL PARKING ...................................................... 14

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ARTICLE SIX – FINANCIAL SECURITY ................................................................................................... 15 6.1 PAYMENT GUARANTY ............................................................................................................. 15 6.2 INDEMNITY AND INSURANCE ................................................................................................. 15

ARTICLE SEVEN – DEFAULT AND TERMINATION ............................................................................... 16 7.1 Operator DEFAULT AND OPPORTUNITY TO CURE ............................................................... 16 7.2 TERMINATION BY CITY ............................................................................................................ 16 7.3 TERMINATION BY Operator ...................................................................................................... 18 7.4 WAIVER ...................................................................................................................................... 18 7.5 SURRENDER ............................................................................................................................. 19

ARTICLE EIGHT – LEGAL COMPLIANCE ............................................................................................... 19 8.1 GENERAL ................................................................................................................................... 19 8.2 DISADVANTAGED BUSINESS ENTERPRISE PROGRAM COMPLIANCE ............................. 19 8.3 GOVERNING LAW ..................................................................................................................... 19

ARTICLE NINE – TRANSFER OF INTEREST .......................................................................................... 19 9.1 ASSIGNMENT ............................................................................................................................ 19 9.2 CHANGES IN Operator .............................................................................................................. 20 9.3 CONSOLIDATION ...................................................................................................................... 20 9.4 NO RELEASE ............................................................................................................................. 20

ARTICLE TEN – MISCELLANEOUS PROVISIONS.................................................................................. 21 10.1 NOTICES .................................................................................................................................... 21 10.2 SEVERABILITY .......................................................................................................................... 21 10.3 SECCESSORS AND ASSIGNS BOUND ................................................................................... 22 10.4 AMENDMENTS .......................................................................................................................... 22 10.5 AUTHORITY TO EXECUTE AGREEMENT ............................................................................... 22 10.6 ATTORNEY’S FEES ................................................................................................................... 22 10.7 TIME OF THE ESSENCE ........................................................................................................... 22 10.8 ENTIRE AGREEMENT ............................................................................................................... 22 10.9 NO PARTNERSHIP OR AGENCY ............................................................................................. 23 10.10 CUMULATIVE REMEDIES ......................................................................................................... 23 10.11 FORCE MAJEURE ..................................................................................................................... 23 10.12 CONFLICT OF INTEREST ......................................................................................................... 23 10.13 NO THIRD PARTY BENEFICIARIES ......................................................................................... 23 10.14 AGREEMENTS WITH OTHER VEHICLE RENTAL Operators .................................................. 24 10.15 INTERPRETATION..................................................................................................................... 24

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AIRPORT AGREEMENT NO. ____________

CITY OF PHOENIX AVIATION DEPARTMENT

AND

_________________________________

THIS Rental Car Concession Agreement (hereinafter “Agreement”) entered into in the City of Phoenix, County of Maricopa, State of Arizona, this ______day of _________, 2017 (“Effective Date”) by and between the City of Phoenix, a municipal corporation (hereinafter “City”) and ____________________, a _____________, (hereinafter “Operator), and [as applicable - Rental Car Brand company], a _____________, (“Brand Name”), and [as applicable - Rental Car Brand company], a _____________, (“Brand Name2”) their respective successors in interest and any assigns. W I T N E S S E T H: WHEREAS, the City owns and operates Phoenix Sky Harbor International Airport (“Airport”) and has the power to lease premises and facilities thereon and grant rights and privileges with respect thereto; and WHEREAS, rental car services at the Airport are essential for proper accommodation of passengers arriving at and departing from the Airport and the provision of such services serves a public purpose; and WHEREAS, the City owns and operates a rental car center, at Phoenix Sky Harbor International Airport located within an approximately 135-acre parcel located at Buckeye Road and Sixteenth Street and situated within Sky Harbor Center; and WHEREAS, as a result of the recent consolidation of rental car companies in the rental car industry and in consideration of the best utilization of the RCC for the benefit of the City and the rental car customers at the Airport, City has determined that a redevelopment of the rental car center is in the customers' interest and have agreed on the redevelopment project for the rental car center; and Rental Car Center Lease WHEREAS, on _________, 2017 the Phoenix City Council adopted Ordinance _______ authorizing the City and Operator to enter into this Rental Car Concession Agreement and a Rental Car Center Lease for the operation of the _______ rental car brand, [and the ______ rental car brand] at the rental car center; and

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WHEREAS, in acknowledgement of the consolidation of rental car companies in the rental car industry, and the terms and provisions of the Rental Car Center Lease for the occupancy of Operator of certain premises at the rental car center, City and Operator are desirous of a entering into this Rental Car Concession Agreement to reflect the Operator’s rental car concession at the rental car center; NOW, THEREFORE, for mutual and sufficient consideration, it is agreed by and between the parties hereto as follows: ARTICLE ONE – DEFINITIONS

“Additional Bonds” means bonds to be issued by or on behalf of the City in one or more series, including but not limited to a refinancing of the Bonds, to be payable in whole or in part from (a) CFC collections in total or for the RCC Share, as the case may be; and/or (b) in the sole and absolute discretion of the City, any other lawfully available funds in addition to CFC collections, in order to finance any and all of those expenditures to which the CFCs may be applied under the CFC Ordinance.

“Affiliate” means those entities associated with Operator operating or who may be approved by City to operate at the Rental Car Center under Section 4.7 and as set forth in Exhibit 1 attached hereto and incorporated herein for all purposes.

“Agreement Term” or “Term” means the time period specifically described in Article Two. “Airport” means the Phoenix Sky Harbor International Airport as defined in the Phoenix City Code as may be amended.

“Bonds” means City of Phoenix Civic Improvement Corporation Rental Car Facility Charge Revenue Bonds, Taxable Series 2004. “Bond Documents” means, collectively, the Trust Indenture for the Bonds or the Additional Bonds and one or more leases or other forms of use agreement relating to the RCC with a municipal property corporation of the City or a private leasing company, as lessee or user, pursuant to which the City may convey or lease its interests in the RCC and the City may acquire the RCC on an installment purchase or lease purchase basis.

“Car Sharing Brand” means for this Agreement an entity determined by City in its sole discretion, as a car sharing business owned, licensed or otherwise authorized by the City to be operated by Operator, limited to the one (1) brand set forth in Exhibit 1, and subject to the provisions of this Agreement. “City” means the City of Phoenix, Arizona.

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“Commencement Date” means January 1, 2018, and reflects the date that Operator may commence its Rental Car Business at the RCC under the terms of this Agreement and the Lease. “Common Transportation System” means the transportation system used to transport Airport customers between Airport terminals and the RCC including but not limited to transportation provided by a common busing operation and/or the PHX SkyTrain (including any irregular operation for the PHX SkyTrain). “Common Transportation O&M” or “TO&M” means the annual costs of operating and maintaining the Common Transportation System, as set forth in Article Five hereof.

“Concession Agreement” or “Agreement” means this Rental Car Concession Agreement between the City and Operator dated as of the Effective Date and containing the terms and conditions for the operation of a non-exclusive Rental Car Business concession at the Airport.

“Contract Year” means the twelve (12) month period beginning on July 1st and ending June 30th. The first Contract Year of the Agreement shall begin July 1 of the calendar year following the Commencement Date.

“Customer Facility Charge” or “CFC” means that charge imposed on Airport rental car customers pursuant to the CFC Ordinance.

“Customer Facility Charge Ordinance” or “CFC Ordinance” means Ordinance No. G-4375 and any amendments or substitutions thereto, including, but not limited to, amendments in Ordinance No. G-4418 and in Ordinance No. G-4530. The CFC Ordinance is currently codified in Phoenix City Code Section 4-79. “Date of Beneficial Occupancy” or “DBO” means the date determined by the City that reflects the completion of the RCC Redevelopment Project and the determination by the City that all areas affected by the RCC Redevelopment Project have received a certificate of occupancy and are ready for rental car operations by the On Airport RACs.

“Director” means the City of Phoenix Aviation Director or his/her designee. “Effective Date” means the ___day of _______, 2017, as set forth above as the effective date in this Agreement. “Eligible Depository” means the eligible depository designated by the City (which may be the Trustee as defined below) as the depository to which CFC’s required to be charged by the Operator are to be remitted. “Exclusive-Use Garage Area” means that portion of the RCC garage area designated for ready and return parking of Operator's rental vehicles.

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“Independent Operators” mean those rental car companies operating as an On Airport RAC that operate at and from the Independent Operator Premises. “Independent Operator Premises” or “IOP” means the RCC Area designated for use by the Independent Operators, as shown in Exhibit 2 attached hereto. “Lease” means the lease agreement between the City and Operator dated as of the Effective Date of this Agreement containing terms and provisions describing and governing the occupancy of the Rental Car Center by Operator. “Minimum Annual Guarantee” or “MAG” means the amount set forth in Article Three in this Agreement as the minimum amount Operator guarantees to pay each Contract Year of the Agreement Term for the concession activities authorized herein. “Off Airport RACs” means a person or business entity that rents vehicles to Airport customers but does not lease space from the City at the Airport, as set forth in the Phoenix City Code, as may be amended in the future. “On Airport RACs” means collectively, those rental car companies leasing space from the City and authorized by the City to conduct their respective Rental Car Businesses at the RCC under a Concession Agreement and Lease Agreement substantially similar to this Agreement and the Lease. “Operator” means ______ pursuant to the rights, privileges and obligations set forth in Section 4.7 and Section 4.8 and also including the Rental Car Brands and approved Affiliates as specifically set forth in Exhibit 1, attached hereto and incorporated herein for all purposes, as such Exhibit 1 may be replaced from time to time set forth in Article Nine hereof. “PHX SkyTrain” means the automated people mover system that will service the RCC at the Airport, which will become the Common Transportation System upon the termination of the common busing system. “PHX SkyTrain Stage 2 Project” means the construction project resulting in the extension of the PHX SkyTrain that will provide the connection to and service for the RCC.

“Prorated Contract Year” means the period of time between the Commencement Date and July 1 of the calendar year following the Commencement Date. “RCC Redevelopment Project” means the improvements to and reconfiguration of the Rental Car Center, including the relocation of the On Airport RACs, more specifically described in the Lease. “RCC Share” means

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(1) With respect to Bonds or Additional Bonds, the debt service and other related costs as set forth in the Trust Indenture specifically associated with the capital costs for the development and/or redevelopment of the RCC and/or the Common Transportation System as reasonably determined by the City, in its sole discretion. To the extent there is a Common Transportation System that is shared with other users at the Airport, the City as set forth in Article Five, shall determine the RCC Share of such Common Transportation System design/construction/development or modification/redevelopment cost; and/or

(2) With respect to the Common Transportation O&M, the cost associated with the Common Transportation System as reasonably determined by the City, in its sole discretion. To the extent there is a Common Transportation System that is shared with other users at the Airport, the City as set forth in Article Five, shall determine the RCC Share of such Common Transportation O&M cost.

“Redevelopment Term” for the Independent Operator Premises means the time period commencing on the Commencement Date and ending on the Date of Beneficial Occupancy, as set forth in Article Two.

“Rental Car Brands” means the individual business entity or individual trade name owned, licensed to or otherwise authorized to be operated by Operator that have been authorized and approved by the City as a component of Operator’s Rental Car Business, specifically including Operator’s Traditional Rental Car Brand(s) and Operator’s Car Sharing Brand, as defined and set forth in Exhibit 1, attached hereto and incorporated herein for all purposes. For purposes of this Agreement use of the term Rental Car Brands shall include the operation of a single rental car brand. “Rental Car Business” means the non-exclusive right and privilege of the use and occupancy of the Rental Car Center and the Airport by an Operator for its conduct of an on-Airport rental car concession and car sharing services, subject to the rights and limitations set forth in this Agreement and the Lease, and the obligation of Operator to provide its rental car service through its Rental Car Brands for the term of the Agreement. “Rental Car Center” or “RCC” means the ground area and improvements built at Sky Harbor Center more specifically described in Exhibit 3.

“Share Calculation Formula” means a fraction, where the numerator is equal to the amount of Operator's Exclusive Use Garage Area at the RCC, and the denominator is equal to the aggregate amount of all On Airport RACs' Exclusive Use Garage Areas. A sample calculation of the formula is shown in Exhibit 4. “Traditional Rental Car Brands” means for this Agreement those business entities owned, licensed to or otherwise authorized by the City to be operated by Operator, limited to the three (3) brands as set forth in Exhibit 1, and subject to the provisions of this Agreement.

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“Trust Indenture” means one or more trust agreements or trust indentures, together with all supplements and amendments thereto, entered into by and between the City, or a municipal property corporation acting on behalf of the City, and the Trustee to provide for the issuance of and security for the Bonds or the Additional Bonds, as the same may be supplemented and amended from time to time in accordance with its terms and provisions. “Trustee” means the financial institution designated as the trustee under the Trust Indenture, or any successor trustee thereunder. “Vehicle” means any automobile of any size and category, sport utility, van, or truck or any other motorized means of conveyance and subject to the use provisions of the Lease. ARTICLE TWO – TERM 2.1 Commencements and Expiration This Agreement is a binding obligation of the parties hereto as of the Effective Date; however the Term of this Agreement will commence on the Commencement Date and shall extend until 12:00 midnight on December 31, 2022, (“Initial Term”) unless sooner terminated as hereinafter provided. After the Commencement Date the Operator will not be allowed to operate at the Airport in any manner inconsistent with the terms of this Agreement. At the City’s sole discretion, the Initial Term of this Agreement may be extended for an extension term until 12:00 midnight on December 31, 2027 (“Extension Term”). City shall provide Independent Operator written notice of City’s decision pertaining to the granting of the Extension Term a minimum of six (6) months prior to the end of the Initial Term. The determination of City for the granting of the Extension Term will also apply to Operator’s Lease, and a separate notification will be provided as set forth therein. The City covenants that the decision related to the granting of the Extension Term will be applicable to all Independent Operators. If the Commencement Date is on a day other than the first day of the month, all monetary obligations under this Agreement will be prorated for the remainder of the month. 2.2 Redevelopment Term The Redevelopment Term of this Agreement shall commence on the Commencement Date and shall extend until DBO. During the Redevelopment Term, the Operator shall have payment obligations as set forth under the Lease, for the Redevelopment Premises defined therein.

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2.2 Holdover If an Operator continues to operate after the expiration of the Term with the consent of the City, this Agreement, with all its terms and conditions, will be deemed extended on a month-to-month basis. Either the City or the Operator may terminate this holdover at any time by giving thirty (30) days written notice of termination to the other. If Operator continues to operate after the expiration of the Term without the City's consent, Operator's occupancy shall be at sufferance in monthly intervals with fees payable in advance and equal to two hundred percent (200%) of the monthly MAG. Operator shall be bound by all conditions and terms of this Agreement. Nothing shall be construed, however, to give any right of holdover and City may exercise any and all remedies at law or in equity to recover possession of the premises identified in the Lease and to terminate Operator’s Rental Car Business at the Airport, together with any damages incurred by the City. ARTICLE THREE – CONSIDERATION 3.1 Concession Fee From the Commencement Date until the end of the Term or earlier termination of this Agreement, Operator will pay an annual Concession Fee (hereinafter “Concession Fee”) for the operation of Operator’s Rental Car Brands which shall be the greater of the Minimum Annual Guarantee (hereinafter “MAG”) as determined for said Contract Year, or the Percentage Fee determined as follows (hereinafter “Percentage Fee”) for said Contract Year:

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A. The Traditional Rental Car Brands identified on Exhibit 1 will be charged a Percentage Fee equal to ten percent (10%) of the such Traditional Rental Car Brand’s Gross Revenues for the applicable Contract Year, and

B. The Car Sharing Brands identified on Exhibit 1 will be charged a Percentage Fee equal to eleven percent (11%) of the Car Sharing Brand’s Gross Revenues for the applicable Contract Year.

The Concession Fee for each Contract Year is to be paid in monthly installments, without demand, on or before the twentieth (20th) day of each subsequent month during the Term hereof. Each monthly installment shall be in an amount not less than the greater of (a) one-twelfth of the applicable Minimum Annual Guarantee, or (b) the Percentage Fee for the month being reported. In accordance with Section 3.17, the Concession Fee for the Prorated Contract Year shall be the greater of the Percentage Fee for the period described in this Section or a prorated portion of the MAG for the first Contract Year. The Concession Fee for any portion of a month will be prorated. Any Concession Fees remaining unpaid are subject to interest as stated in Phoenix City Code Section 4-7 and any amendments thereto. 3.2 Minimum Annual Guarantee (MAG)

The Minimum Annual Guarantee amount for the first Contract Year of the Term of the Agreement for the privileges and rights to be awarded under this Concession Agreement shall be $______________ . For each subsequent Contract Year of the Term of the Agreement, the Minimum Annual Guarantee shall be adjusted to be the greater of eighty five percent (85%) of Operator’s Percentage Fee for the previous Contract Year or the Minimum Annual Guarantee for the first Contract Year of the Term of the Agreement. In no event shall the MAG fall below the first Contract Year.

3.3 MAG Abatement The City is not providing MAG abatement during the Term of this Agreement.

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3.4 Gross Revenues

A. Definition

“Gross Revenues” includes all amounts received, billed (whether collected or not), delivered and/or realized by the Operator, without deduction or offset, whether by cash, credit or otherwise related to Operator’s Rental Car Business as authorized by this Agreement. All revenue is included in the definition of Gross Revenues unless specifically excluded as provided below in Subsection B. In determining whether an amount is or is not Gross Revenue the burden of proof is on the Operator and all exclusions in Subsection B will be construed narrowly.

B. Exclusions

Gross Revenues shall not include:

1. Taxes - Any fee or other charge levied by federal, state, county or municipal government that is explicitly identified by the taxing authority as a tax levied on the customer and required by law to be separately stated. 2. Customer Facility Charge – As defined in Phoenix City Code 4-79, as amended, when collected and remitted to the City. 3. Obligation Payment - In the event of a Voided CFC as defined in Section 3.10 of this Agreement, during the time frame when an Obligation Payment is paid to the City.

4. Sums actually collected by Operator from the rental car customer for payment of unpaid tolls, parking tickets, towing, impound fees, damage, loss, conversion, or abandonment of Operator’s Vehicles or for disposal of Operator’s damaged vehicles, including the penalty or administrative fee imposed by a third party and actually collected by Operator from the rental car customer for the collection effort, provided that Operator retains, in accordance with Section 3.16, documentation from a third-party that establishes that the payment of unpaid tolls, parking tickets, towing, impound fees, damage, loss, conversion, abandonment, disposal, or administration or collection fees occurred and identifies the sums collected.

3.5 Diversion of Rental Car Business Revenue

Operator agrees that it will not divert revenue from Operator’s Rental Car Business concession authorized by this Agreement from being included in Gross Revenues. Diversion shall include, but not be limited to, Operator advising or suggesting to a customer or potential customer arriving at the Airport that such customer or potential customer rent a Vehicle at any off-Airport location, regardless of the reason.

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Operator agrees that it will not rename or revise any Gross Revenues, fees, charges, or other revenue, or falsify any of its records, in an attempt to avoid payment of, or reduce Gross Revenues, or reduce payment of any other charges or fees due and owing to the City hereunder.

3.6 Pass Through of Concession Fee - Concession Recovery Fee Operator acknowledges that the Concession Fee payments by Operator to the City under this Agreement are for Operator’s use of the facilities and access to the Airport market, and that none of those payments reflect a fee that is imposed by the City upon customers renting vehicles from Operator. The City does not require, but will not prohibit, the separate statement of the Concession Fee on customer invoices or rental contracts provided that Operator meets all the following conditions:

A. Such fee is titled “Concession Recovery Fee” and shall not exceed eleven and eleven one hundredths percent (11.11%) for Traditional Rental Car Brands and _________ (___ %) for Car Sharing Brands, of the Gross Revenues resulting from that rental contract; B. Such fee shall be indicated immediately below all concessionable items and not immediately adjacent to taxes on customer invoices; C. Operator complies with all applicable laws including Federal Trade Commission requirements; D. Operator shall not identify, treat or refer to the Concession Recovery Fee

as a tax; and E. If Operator elects to separately state on its customer rental agreements and recover from its customers its Concession Fee, Operator agrees to state any such amount as no more than Operator’s Concession Recovery Fee as provided in this Section and in a manner such that it cannot be construed by Customer to be mandated by the City.

3.7 Pass Through of Other Payments Operator shall notify City thirty (30) days prior to implementation of Operator’s intention to pass through, unbundle, or list any payments (other than a Concession Recovery Fee and Customer Facility Charge) payable to the City as a separate item on its customer invoices, for sole the purpose of City to review and approve in writing the nomenclature used for such pass through of fees, which approval shall not be unreasonably withheld.

3.8 Customer Facility Charge (CFC) – Ordinance and Remittance

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The City adopted Ordinance No. G-4375 amended by Ordinance No. G-4418, and Ordinance No. G-4530, imposing a uniform CFC on rental car customers at the Airport. The CFC Ordinance is currently codified in Phoenix City Code Section 4-79. The CFC Ordinance and Phoenix City Code Section 4-79 may be amended as needed and approved by Phoenix City Council. The Operator shall promptly remit to the Eligible Depository the CFC's required to be charged, and at the times required under the CFC Ordinance (regardless of whether such amounts are actually collected). The Operator covenants and agrees that it will not be entitled to any rights to offset or other reduction in the requirements herein and to remit to the Eligible Depository all CFC's imposed regardless of any amounts that may be owed or due to the Operator by the City. All CFC's collected by the Operator shall be trust funds held for the benefit of the City and subject to the pledge by the City under the Bond Documents. The Operator shall have only a possessory interest and not an equitable interest in CFC collections. The Operator hereby consents to such pledge and acknowledges the Trustee's security interest in the CFC collections as the Trustee's bailee under Article 3, Chapter 9, Title 47 of the Arizona Revised Statutes, as amended. 3.9 CFC Covenant Without limiting the provisions provided in the CFC Ordinance, Operator and City hereby acknowledge that prior and future improvements to the RCC were and are being undertaken for improved customer service, enhanced operational efficiency, and business growth related to the rental car program at the Airport. Operator and City also acknowledge: (1) CFC and/or the proceeds of the Bonds were the principal funding source for the original design, construction and equipment related to the RCC, the bus maintenance facility and Common Bus System, (2) CFCs will be the principal funding source for the RCC Redevelopment Project, and (3) CFCs and/or the proceeds of the Additional Bonds will be included as funding sources for the Common Transportation System, including the construction of the PHX SkyTrain Stage 2 and the annual operating and maintenance costs for the PHX SkyTrain. During the Term hereof, the PHX SkyTrain Stage 2 construction costs and the ongoing operating and maintenance costs of the PHX SkyTrain not funded with CFCs and/or the proceeds of the Additional Bonds will be funded from sources unrelated to the Operator’s Rental Car Business. Operator hereby expressly covenants to abide by the requirements and obligations set forth in the CFC Ordinance, as same may be amended, and further expressly covenants (1) it will not join in a legal proceeding against the City that would render the CFC Ordinance or the collection and remittance of the CFC thereunder, in whole or in part, invalid, unconstitutional, unlawful or unenforceable, and (2) to cooperate with the City in the City’s defense of any challenge against the CFC Ordinance or otherwise, that would render the CFC Ordinance or the collection and remittance of the CFC thereunder, in whole or in part, invalid, unconstitutional, unlawful or unenforceable. The City and Operator also covenant to use reasonable efforts to oppose any challenges to the CFC Ordinance.

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This covenant shall survive the expiration or other termination of this Agreement. 3.10 Obligation Payment In the event that a decision by any court of competent jurisdiction renders the CFC in general or the CFC Ordinance in whole or in part, invalid, unconstitutional, unlawful or unenforceable, (“Voided CFC”) the City shall prepare and deliver to the On Airport RACs a Bond Report of the Rate Consultant and/or other related documentation for the determination of the anticipated future impact to the City and the operation of the RCC and the Common Transportation System. In addition, for any Contract Year or any partial Contract Year of the Term commencing with the Commencement Date in which there is a Voided CFC, the City shall prepare and deliver to the On Airport RACs a report that outlines the amount, whether actual or forecasted, necessary to cover (1) the debt service and/or RCC Share of the debt service and any other required fees or reserves set forth in the Trust Indenture for the Bonds and/or the Additional Bonds, as applicable, (2) the amount to cover any anticipated capital expenditures for the RCC and/or the RCC Share of the Common Transportation System not funded with Bonds or Additional Bonds, as applicable, and (3) the amount to cover the Common Transportation O&M (or if applicable, the RCC Share of the Common Transportation O&M), (“Annual Obligation Requirement”). The Annual Obligation Requirement specifically excludes the reimbursement of any payment made by City prior to the determination of the Voided CFC for any capital or operational expenses or costs related to the RCC and the Common Transportation System. After consultation with the On Airport RACs, the City shall reasonably determine, in City’s sole discretion, the remedy or combination of remedies for the loss of the CFC revenue from the Voided CFC which remedies may be imposed at different times and in different combinations and include, but are not limited to the following options, listed in no particular order:

A. City will use its best efforts to promptly modify or recommend for adoption the appropriate ordinance or ordinances to allow for the legal collection of a rental car customer based charge for such customer’s use of the RCC and the Common Transportation System, including a customer based charge calculated on a per day basis, at a level to cover at a minimum the revenues required for the Annual Obligation Requirement.

B. On or about the date that the Voided CFC is in effect, City may impose a payment on the On Airport RACs necessary to meet the Annual Obligation Requirement, taking into account any customer based charges that might be collected, (“Obligation Payment”). Operator’s share of any Obligation Payment shall be determined by applying the Share Calculation Formula.

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The Obligation Payment will commence on the first day of the month following thirty (30) day’s prior written notice from City to Operator. In the event an Obligation Payment is imposed on the On Airport RACs, the On Airport RACs to the extent legally permissible, may pass through, unbundle, or list Obligation Payment as a separate item on its customer invoices, subject to the requirements of Section 3.7 above.

C. City using reasonable discretion and after consultation with the RACs as set forth herein, shall determine the required or desired changes to the operations, business program and financial program related to the RCC pertaining to Operator’s Rental Car Business at the Airport (“New Program”). City shall develop new documentation (“New Agreements”) to reflect the New Program. The City may terminate this Agreement and all related agreements, including but not limited to the Lease, pertaining to Operator’s Rental Car Business at the Airport upon six (6) month’s prior written notice from City to Operator in the event that any On Airport RAC does not execute the New Agreements in the reasonable time frame set forth by the City for such execution. Except as provided in the default and termination provisions of the respective agreements, this Agreement, and all related agreements of Operator shall not be terminated unless all agreements and related agreements of all On Airport RACs at the RCC are likewise terminated.

In the event the City elects to impose an Obligation Payment on the On Airport RACs and for the duration of the Obligation Payment requirement, the City shall prepare and deliver to the On Airport RACs on an annual basis the Annual Bond Year Report of the Rate Consultant and/or other updated or related documentation for the reporting of Obligation Payment revenues against the forecasted Annual Obligation Requirement for each Contract Year. Upon delivery of such reports, the City shall meet with the On Airport RACs to review the required Obligation Payment revenues in relation to the Annual Obligation Requirements. The City shall reasonably determine in its sole discretion, the appropriate Obligation Payment increase or decrease that is reasonably sufficient to address Annual Obligation Requirement for the applicable Contract Year and/or subsequent Contract Years of the Term. Such Obligation Payment shall remain in place as set forth herein until such time as City provides written notification to the On Airport RACs that an ordinance(s) have been authorized to allow for the legal collection of a rental car customer based charge for such customer’s use of the RCC and the Common Transportation System at a level to cover at a minimum the revenues required for the Annual Obligation Requirement, or other remedies as determined by the City in its sole discretion, have been determined for this purpose. 3.11 Customer Facility Charge – CFC Deficiency

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For each Contract Year or partial Contract Year of the Term commencing with the Commencement Date, the City shall prepare and deliver to the On Airport RACs the Annual Bond Year Report of the Rate Consultant and/or other related documentation and, upon delivery of such reports, shall meet with the On Airport RACs to review the CFC revenues in relation to the Annual Obligation Requirement as defined in Section 3.10, and address any other RCC related matters. If after consultation with the On Airport RACs, the City reasonably determines that there is a deficiency between the CFC revenues necessary to meet the Annual Obligation Requirement and the actual CFC revenues collected during a current Contract Year, or forecasted to be collected for any upcoming Contract Year, during the Term (where such deficiency is not related to a Voided CFC as set forth in Section 3.10), (hereinafter “CFC Deficiency”) the City will initiate the following actions listed in the order of priority:

A. The City will determine if there are available CFC funds held in a CFC reserve account for the Bonds (currently designated as the “Improvement Reserve/Surplus Fund” or the “IRSF” ) at the City for which all or a portion thereof could be used to offset or partially offset the CFC Deficiency for any applicable Contract Year. The IRSF fund balance (and/or the fund balance of fund/account under the Trust Indenture for Additional Bonds that has the same purpose as the IRSF Fund) will be applied to the CFC Deficiency (applied first to the debt service for the Bonds) and the remaining deficiency, if any, is referred to hereinafter as the “Net CFC Deficiency”. Other reserve funds required under the Trust Indenture for the Bonds and/or Additional Bonds may not be available for offset or partial offset of a CFC Deficiency under the terms of the Trust Indenture, however the City will use reasonable efforts to determine if such reserve funds can be released for offset to the CFC Deficiency and if available, will apply such funds accordingly to further reduce the amount of the Net CFC Deficiency. The actions taken to offset a CFC Deficiency with CFC funds held in a CFC reserve account for any Contract Year may be modified from time to time by the City to reflect the circumstances related to changes, whether current or forecasted, in the CFC Deficiency. B. The City, acting promptly and using good faith efforts, will endeavor to immediately take actions to reduce the then current RCC Share of the Common Transportation System O&M expenses to further offset or partially offset the Net CFC Deficiency for any applicable Contract Year. The actions taken to reduce the RCC Share of the Common Transportation System O&M expenses for any Contract Year may be modified from time to time by the City to reflect the changing circumstances related to changes whether current or forecasted in the CFC Deficiency.

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C. The City, acting promptly and using good faith efforts, will identify which anticipated capital expenditures for the RCC and/or the RCC Share of the Common Transportation System not funded with Bonds can be deferred or reduced in scope, to further offset or partially offset the Net CFC Deficiency for any applicable Contract Year. The actions taken to defer or reduce in scope anticipated capital expenditures for the RCC and/or the RCC Share of the Common Transportation System not funded with Bonds for any Contract Year may be modified from time to time by the City to reflect the circumstances related to changes whether current or forecasted in the CFC Deficiency. D. The City, acting promptly and using good faith efforts, will determine the appropriate CFC increase that is reasonably sufficient to cover all or a portion of the CFC Deficiency for the applicable Contract Year and/or subsequent Contract Years of the Term. If the City determines in its sole discretion that an increase to the CFC rate is in the best interest of the Airport, the City may, but is not obligated to make a recommendation to the City Council for an increase to the CFC rate to a level sufficient to cover all or a portion of the CFC Deficiency, taking into consideration the level of the Net CFC Contingency. Such increase shall be subject to the provisions of the Trust Indenture and the CFC Ordinance, and subject to the formal approval of Phoenix City Council to be effective. The actions taken to increase the CFC rate for any Contract Year may be modified from time to time by the City to reflect the changing circumstances related to changes whether current or forecasted in the CFC Deficiency.

3.12 Contingent Payment Should the actions set forth in Section 3.11 above fail to completely offset the Net CFC Deficiency necessary to meet the Annual Obligation Requirement, or if the passage of time to achieve the completion of the actions set forth in Section 3.11 above fails to meet the Annual Obligation Requirement timeframes for any Contract Year, the City acting promptly and using good faith efforts, will determine if the On Airport RACs will be required to pay to City Contingent Payment, to offset the Net CFC Deficiency for any applicable Contract Year. The imposition of Contingent Payment to the On Airport RACs by the City is subject to the following:

A. Notwithstanding the determination of the total Net CFC Deficiency for any applicable individual Contract Year during the Term, the portion of the Net CFC Deficiency in any such Contract Year that is designated for payment by Contingent Payment shall not exceed Five Million Dollars ($5,000,000).

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B. The Contingent Payment will commence upon the first day of the month following thirty (30) day’s prior written notice from City to the On Airport RACs. In the event that a Contingent Payment was imposed during the Term and subsequently thereto, CFC revenues in any Contract Year exceed or are forecasted to exceed the Annual Obligation Requirement, City shall promptly notify the On Airport RACs in writing of the date of the termination of the Contingent Payment obligation. Contingent Payment paid by the On Airport RACs prior to the termination of the Contingent Payment obligation that has not been previously reimbursed by the City (as set forth in Section 3.13) is referred to herein as “Paid Contingent Payment.” C. This Contingent Payment obligation and the use of CFC funds are and will remain subject to the rights provided to the City under the CFC Ordinance. However the City agrees that it will take no action voluntarily to reduce the CFC rate set forth in the CFC Ordinance and, as set forth above, will use its best efforts to request a reasonable increase to the CFC rate to address a CFC Deficiency. The foregoing and the provisions of Section 3.7 notwithstanding, in the event Contingent Payment is imposed on the On Airport RACs, the On Airport RACs may not pass through, unbundle, or list Contingent Payment as a separate item on its customer invoices. D. For any Contract Year or partial Contract Year of the Term, Operator’s share of any Contingent Payment shall be determined by applying the Share Calculation Formula.

3.13 Contingent Payment - Excess CFC Revenues In the event total CFC revenues in a Contract Year are greater than the Annual Obligation Requirement, the City will apply such excess CFC revenues in the following order of priority, but may structure, spread or defer any payment or credit to the On Airport RACs under this Section for a time frame up to thirty-six (36) months. In the event the Agreement terminates prior to City repayment to On Airport RACs within the thirty-six month period, the City will continue to meet the obligation following expiration of the Agreement.

A. Paid Contingent Payment shall be reimbursed as and when the excess CFC revenues are received by the City for any Contract Year and such repayment to the On Airport RACs shall be paid as such revenues are received based on the same Share Calculation Formula basis as the Contingent Payment was paid. City shall provide a reimbursement credit (which may be at the City’s discretion in the form of rent credits against future rental/payment obligations) to the On Airport RACs for the Paid Contingent Payment.

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B. Bond reserve funds (other than the IRSF and/or the fund balance of fund/account under the Trust Indenture for Additional Bonds that has the same purpose as the IRSF Fund) used to offset the CFC Deficiency shall be reimbursed, as and when excess CFC revenues are received by the City for any Contract Year and the structure for the repayment to the On Airport RACs of Paid Contingent Payment is in place. C. Payments made by the City related to the CFC Deficiency (payments made in excess of Paid Contingent Payment or in lieu of imposition of Contingent Payment, or in lieu of an increase in the CFC rate in any Contract Year) for any Contract Year may be reimbursed to the City as and when excess CFC revenues are received by the City, and the structure for the repayment to the On Airport RACs of Paid Contingent Payment is in place. D. Any lawful purpose provided under the CFC Ordinance.

3.14 Taxes and other Exactions Operator is responsible for payment, in a timely fashion, directly to the applicable taxing authority, of any applicable tax or other exaction assessed or assessable as the result of its conduct of business at the Airport under authority of this Agreement, including any tax payable to the City. 3.15 Time and Manner of Payment All payments to be made under this Agreement will be due without demand in accordance with the following:

A. MAG – One twelfth (1/12th) of the annual MAG shall be paid on the first day of each month for said month.

B. Percentage Fee – On or before the twentieth (20th) day of each month, the Operator will submit a monthly statement of Gross Revenues for the preceding month. If the Percentage Fee, as stated in Section 3.1 above, for said month exceeds an amount equal to one twelfth (1/12th) of the MAG, the Operator will also submit the difference at that time.

C. CFC – On or before the last day of each month, the Operator shall submit a monthly statement of transactions and transaction days for the prior month and remit the CFC proceeds collected for the prior month in accordance with Phoenix City Code Section 4-79.

D. Contingent Payment – on or before the first day of each month, Operator will remit the Contingent Payment, if applicable, for the then current month. Operator will be notified of adjustments in monthly amounts thirty (30) days prior

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to the inception of the Contract Year and the new amounts will take effect on the first day of the Contract Year. E. Obligation Payment – on or before the first day of each month, Operator will remit the Obligation Payment, if applicable, for the then current month. Operator will be notified of adjustments in monthly amounts thirty (30) days prior to the inception of the Contract Year and the new amounts will take effect on the first day of the Contract Year. F. All payments shall be tendered in lawful currency of the United States, either by check or by electronic transfer and free from all claims or setoffs of any kind against City. In the event technological advances make point of sale Gross Revenue reporting and payment transfers more economically feasible, the City, after considering the economic impact to both the Operator and the City, may revise how payment remittances are made. Any and all equipment and transmission changes necessary to accomplish the change in the reporting and/or remittance process will be the responsibility of the Operator.

G. All of the above payments (except CFCs and reports) shall be remitted to:

Aviation Department City of Phoenix P.O. Box 29110 Phoenix AZ 85038-9110

CFC payments and reports shall be remitted to:

Aviation Department City of Phoenix P.O. Box 29112 Phoenix AZ 85038-9112

Or to any other address where the City instructs the Operator in writing to submit the payments and reports.

H. The payment resulting from the Percentage Fee exceeding one twelfth (1/12th) of the MAG may not be applied to the payment of MAG or any other fees in any previous or subsequent months. An annual reconciliation as described in Section 3.17 of this Agreement shall address any cumulative overpayment or underpayment.

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I. The form of the statement of Gross Revenues to be submitted each month is set forth as Exhibit 6. With appropriate written notice to Operator, the City reserves the right to prescribe or change reporting forms, their method and time of submission, and the payment schedule. Only those exclusions to Gross Revenues that are expressly authorized under Section 3.4(B) of this Agreement, that are identified clearly and separately on the statement of Gross Revenues, and that are supported by sufficient documentation will be allowed.

3.16 Books and Records Upon the prior written request of the City, during normal business hours Operator will make available for inspection and review by the City’s employees, agents, and contractors all of its records, including any and all electronic records or electronic data, for the time period specified below. To the extent that the Operator’s records are available in electronic form, Operator must provide the records in electronic form if so requested by the City. It is the intent of the City that Operator maintains records with sufficient specificity in order to enable the City to determine the amounts billed to each of their customers and the Gross Revenues billed and/or received by the Operator under this Agreement. These records shall include, but not be limited to: charts of accounts, general ledgers, daily business reports, and original or copies of rental agreements for all Airport related transactions. All such records are to be maintained in accordance with generally accepted accounting principles and show in detail all business conducted at the Airport. These records must be maintained from (a) the date of any previous audit or (b) a period of five (5) years after expiration or earlier termination of this Agreement. These records are to be kept within the metropolitan area of the City of Phoenix. If Operator does not maintain such records in the Phoenix metropolitan area, then it must advise City, in writing, of the location where the records are stored. Upon City’s request or in the event of an audit, the Operator shall either (a) deliver said records to the address of the City Auditors within thirty (30) days of the City’s request and pay for all expenses associated therewith, or (b) pay for reasonable travel expenses for the auditors to have the audit conducted at the location where Operator maintains the records, including an administrative fee of fifteen percent (15%) of the actual costs of the audit. The records requirements of this Section shall extend to any of the Operator’s subsidiaries, partners, joint ventures and subcontractors. 3.17 Annual Statement of Gross Revenue Not later than ninety (90) days after each Contract Year, Operator, at its sole expense, shall deliver to the City a certified annual statement prepared by an Independent Certified Public Accountant in accordance with generally accepted accounting principles and the terms and conditions of this Agreement, of the Operator’s Gross Revenues for the prior Year.

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Based on this statement of Gross Revenues, the Director will determine whether the payments received by the City from the Operator for the applicable Year shall be the Minimum Annual Guarantee or the Percentage Fee of the annual Gross Revenue, whichever is greater, and following said determination an adjustment of the amount payable by the Operator or the credit due to the Operator will be made, if necessary. In no event will the annual amount payable to the City be less than the Minimum Annual Guarantee. If the period for the Prorated Contract Year is less than six months, then the Operator shall combine the Operator’s Gross Revenues for the Prorated Contract Year with the first Contract Year and submit the combined certified statement ninety (90) days after the end of the first Contract Year. Based on this combined certified statement, the Director will make the determination of the amounts payable by the Operator or the credit due to the Operator for both the Prorated Contract Year and the First Contract Year. If the period for the Prorated Contract Year is six months or more, then the Operator shall submit a separate certified statement for the Prorated Contract Year ninety (90) days after the end of the Prorated Contract Year. Based on this certified statement, the Director will determine the amounts payable by or the credit due to the Operator for the Prorated Contract Year. Operator’s failure to submit the Annual Statement of Gross Revenue by the due date will result in its liability for all costs incurred by the City to hire an Independent Certified Public Accountant to prepare the required statement, including an administrative fee of fifteen percent (15%) of said costs. 3.18 Audit The City reserves the right to conduct an audit at any time. If, as a result of the audit, the City determines that additional funds are due the City, Operator shall be notified of the City's findings and invoiced for the total amounts due, including any delinquent fees owing pursuant to Phoenix City Code section 4.7, and any amendments thereto, from the date the fees were first due. After such notice, Operator shall elect to: (1) agree with the City's audit findings, and within thirty (30) days after receipt of said notice, make known its agreement to the City in writing and pay all amounts invoiced by the City; or (2) disagree with the City's audit findings, and within thirty (30) days after receipt of said notice, make known its disagreement to the City in writing and pay all amounts invoiced by the City, then within sixty (60) days after receipt of said notice, furnish to the City, at Operator's expense, an audit made by an Independent Certified Public Accountant mutually agreeable to both parties. Failure of Operator to dispute the audit findings, in writing, within thirty (30) days, shall constitute acceptance of the audit findings, and waiver of the right to appeal the audit findings. In the event any deficiency of two percent (2%) or greater of the amount payable to City is ascertained, Operator agrees to pay City for the cost of City's audit and for all deficiencies and delinquent fees as stated above.

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The final audit of the Independent Certified Public Accountant shall be conclusive upon the parties. After a copy of the Certified Public Accountant's final report has been delivered to the City any overpayment by the Operator shall be promptly credited to the Operator. ARTICLE FOUR - USE 4.1 Uses Permitted During the Term of this Agreement, and subject to Operator’s Lease at the RCC, Operator shall have the non-exclusive right to operate its Rental Car Business at the Airport. Operator understands and agrees that it is restricted under this Agreement to activities necessary to the operation of a Rental Car Business only, specifically including Operator’s Traditional Rental Car Brand(s) and Operator’s Car Sharing Brand, as defined and set forth in Exhibit 1, and subject to Article Five of the Lease, and that no other product, merchandise, or service shall be sold or offered by Operator without the express written consent of the Aviation Director. Operator further agrees that all Airport related rental car transactions will take place at the RCC. 4.2 RCC Lease Concurrently with the execution of this Agreement, the Operator will execute a Rental Car Center Lease under which it will occupy, use and lease space at the RCC. 4.3 Standards of Service

A. Operator shall offer for rental only Vehicles of recent manufacture (not more than two (2) model years old), except as stated below. All Vehicles provided by Operator shall be maintained at Operator’s expense in good and safe operating order, free from any known mechanical defects, and in clean and neat condition inside and out. Operator shall furnish good, prompt and efficient service and shall at all times have available a sufficient number of Vehicles to meet all commercially and reasonably foreseeable rental demands of the Operator by the traveling public using the RCC. B. Operator may offer for rental antique, vintage or classic vehicles. Operator may also offer luxury or prestige vehicles that are of recent manufacture, free from known defects, and clean and neat inside and out.

C. Operator shall provide and maintain federally approved infant and children’s auto safety seats, including appropriate installation hardware.

D. The City shall have the right, but not the obligation, to prohibit Operator from offering rental of any Vehicle that the City reasonably determines does not meet the standards described herein.

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E. Operator shall: (1) accept at least three (3) nationally recognized credit cards for payment of Vehicle rental; and (2) provide for a national reservation system for services of the Operator.

F. Operator shall maintain a sufficient number of trained personnel to ensure that its customers receive prompt and courteous service at all times. All personnel of Operator, while on the RCC premises, shall be polite, clean and neat in appearance, and appropriately attired. City may issue a written complaint to Operator with respect to unsuitable demeanor, conduct or appearance of Operator’s employees, invitees and those doing business with it, and Operator hereby agrees to take all steps necessary to remedy such complaint.

G. Operator shall assure that its agents and employees do not engage in the overt solicitation for rentals or related services offered by Operator on or about the RCC. Soliciting is defined as any action by any employee or representative of Operator to market or sell Operator’s rental services at the RCC prior to initiation of a conversation by a prospective customer with Operator’s employee or representative within its exclusively leased space in the Customer Service Building of the RCC. H. Operator shall not misrepresent to the public its prices or the terms and provisions of its rental agreements or of its competitors and in connection therewith shall comply with all applicable rules and regulations of the Federal Trade Commission and all other governmental agencies. Operator shall fully inform each customer, prior to the execution of such customer’s rental agreement, of all fees and charges applicable to customer’s rental. Operator shall, upon receipt of written notice, immediately cease any business practices that the City reasonably identifies as deceptive, unreasonable or unconscionable.

I. Operator shall provide for payment of all traffic violation notices issued to its Vehicles that are under the control or operation of its employees at the Airport. Further, Operator shall pay for any expenses, such as towing or parking charges, incurred as a result of parking or abandoning of Vehicles by any person in areas other than those designated by the City for use by the Operator.

J. Operator shall appoint, and submit in writing to the City the name of, a representative authorized to act on behalf of the Operator in matters pertaining to its operation and to permit City access to its Lease premises on a twenty four (24) hour basis. The Operator is responsible for keeping the name of its representative(s) current with the City and failure to do so shall constitute a default under this Agreement. In the event of an emergency, Operator shall have this representative available and able to act on its behalf.

K. Operator will have a reasonable number of vehicles that are ADA compliant.

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4.4 Complaints If Operator receives (or the City receives and forwards to Operator) any written complaint concerning Operator’s operation of its business at the Airport, Operator shall promptly respond to such complaint in writing within thirty (30) days of its receipt and make a good-faith attempt to explain, resolve or rectify the cause of such complaint. Without further notice or demand, Operator shall keep a copy of each such complaint and Operator’s written response for a period of one year from the date of the complaint and shall make the complaint and written response available to the City upon its written request. 4.5 Operating Hours Operator agrees to open for business daily at the RCC no later than one hour prior to the first scheduled flight and to close daily no earlier than one hour after the last scheduled flight, unless otherwise determined in writing by the Aviation Director who shall give notice thereof to the Operator in accordance with Section 10.1 below. 4.6 Permits and Vehicle Registration Operator shall acquire and maintain in effect throughout the Term all permits, registrations, and licenses necessary to comply with local, State and Federal requirements with respect to the operation of its non-exclusive Rental Car Business at the Airport. 4.7 Operator’s Obligations for Rental Car Brands and Affiliates In the event _________, Brand Name, or Brand Name2 is a corporation, a limited liability company, or a partnership, each person executing this Agreement on behalf of _________, Brand Name, or Brand Name2, respectively does hereby covenant and warrant that _________, Brand Name, or Brand Name2, respectively is a duly authorized and existing entity duly qualified to do business in the State of Arizona, that _________, Brand Name, or Brand Name2, respectively has full right and authority to enter into this Agreement, and that each of the person(s) executing this Agreement on behalf of _________, Brand Name, or Brand Name2, respectively is authorized to do so by the officers and Board of Directors of their respective Corporations. The City may request other evidence reasonably necessary to confirm the foregoing warranties. Brand Name and Brand Name2 hereby authorize __________ in its capacity as the Contracting Entity as set forth in Exhibit 1 has on their behalf the full right and authority to enter into any future amendments, restatements or modifications of this Agreement and any related documents thereto specifically including but not limited to the Rental Car Center Lease.

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__________________ in its capacity as the Contracting Entity as set forth in Exhibit 1 has, for the purpose of this Agreement, the Lease and related documents for the operation of the Operator’s Rental Car Business at the Airport, the possession, directly or indirectly, of the power to direct or cause the direction of the management, operation, and policies of all Rental Car Brands and Affiliates set forth in Exhibit 1 attached hereto, (including any updated versions of Exhibit 1 during the Term which may be attached to this Agreement without necessity of amendment or modification hereto), for the operation of the Rental Car Business at the Airport, whether through the ownership of voting securities, or by contract or otherwise.

4.8 Operators Joint and Several Liability It is understood and agreed that the word “Operator” and verbs and pronouns in the singular number and gender are uniformly used throughout this Agreement and the Rental Car Center Lease, regardless of the number or gender or fact of incorporation of the party who is, or of the parties who are, the actual Operator or Operators under the this Agreement, and the Lease. _________, Brand Name, or Brand Name2 (collectively “Operator”) and any other entity that becomes an Operator under this Agreement and the Rental Car Center Lease, shall be jointly and severally liable thereunder. Nothing in this Section, however, shall be understood to make any such Operator liable for the obligations of any other rental car company under any separate rental car concession and/or lease agreement. 4.9 Conformity of Contracts In the case of any inconsistency, between the Lease and this Agreement and/or related documents for the operation of the Operator’s Rental Car Business at the Airport, the City shall determine in its sole and reasonable discretion, the applicability and enforcement of the appropriate term, condition, covenant and agreement for Operator on a case by case basis, and may provide an amendment to any or all of this Concession Agreement, the Lease, and/or related documents for the operation of the Operator’s Rental Car Business to clarify any such inconsistency. ARTICLE FIVE – TRANSPORTATION 5.1 Common Transportation System Airport customers will be transported to and from the Airport, including the RCC exclusively on a Common Transportation System provided by the City. Customers of all On Airport RACs and Off Airport RACs at the Airport will be required to use the Common Transportation System. No On Airport RAC will be permitted at any time under any circumstances to use its own transportation system or contract with a third party transportation system, or use vouchers, or use its rental Vehicles to pick up or drop off customers at the Airport terminals. Without limiting the rights and privileges set forth in

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the CFC Ordinance, and taking into consideration the provisions of Article Three of this Agreement, the Common Transportation O&M (or if applicable, the RCC Share of the Common Transportation O&M) will be funded from CFC proceeds. The City will require that customers of Off Airport RACs will be "double-bused,” meaning that the customers will be transported between the Airport terminals and the RCC via the Common Transportation System and may only be picked up at a position at the RCC designated curb for Off Airport RACs. The customers will then be transported to the Off Airport RACs off-site location. Drop off of customers of Off Airport RACs will occur in the same manner at the same RCC curb. Loading and unloading curbside positions for the Common Transportation System have been identified for each Airport terminal and at the RCC. At the discretion of the City in consultation with the On Airport RACs and Off Airport RACs, these positions may be changed from time to time as is necessary to provide for appropriate curb management and traffic control. Upon completion of the PHX SkyTrain Stage 2 Project the loading and unloading curbside positions may be reallocated by the City for other uses.

5.2 PHX SkyTrain 5.2.1 PHX SkyTrain Stage 2 Project - Development Cost

Operator hereby acknowledges that City intends to initiate the PHX SkyTrain Stage 2 Project during the Agreement Term, and that the PHX SkyTrain will become the Common Transportation System upon the termination of the common busing system. City will periodically advise the On Airport RACs as to the progress for the design and construction of the PHX SkyTrain Stage 2 Project, and will provide written notice to the On Airport RACs for the date of the transition of the Common Transportation System from the common busing operation to the PHX SkyTrain.

Prior to the transition of the Common Transportation System from the common busing operation to the PHX SkyTrain, the City shall consult with the On Airport RACs regarding that portion of the design/construction/development or modification/redevelopment cost of the PHX SkyTrain, including but not limited to the PHX SkyTrain Stage 2 Project, allocated to the RCC and to be funded CFC revenues, whether on a “pay as you go basis”, on an annual basis, or otherwise (referred to elsewhere herein as the RCC Share); and such RCC Share will be reasonably determined by the City in the City’s sole discretion. Operator acknowledges that the annual RCC Share shall be included in the determination of the Annual Obligation Requirement.

5.2.2 Common Transportation O&M

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Operator and City agree that the annual operating and maintenance cost of operating and maintaining PHX SkyTrain will be funded in part with CFC revenues. After consultation with the On Airport RACs, a portion of the operation and maintenance costs of the PHX SkyTrain allocated to the RCC anticipated to be funded CFC revenues on an annual basis (referred to elsewhere herein as the RCC Share) will be reasonably determined by the City in the City’s sole discretion. Operator acknowledges that the annual RCC Share shall be included in the determination of the Annual Obligation Requirement. In addition, except as needed for irregular operations throughout the Term, the operation and maintenance costs of associated with a common busing operation including the Bus Maintenance Facility will be transitioned and ultimately removed from the calculation of the RCC Share of the TO&M.

5.3 Handicap and Special Needs Terminal Parking City will allow the Independent Operators to contract for one (1) parking space at each of the Airport Terminals to be shared by them and used cooperatively at their discretion for assisting customers with disabilities or who have special needs. The Independent Operators will pay for any costs associated with these parking spaces in accordance with the IOP Share Calculation Formula set forth in the Lease.

A. Rate. The monthly rate for special needs parking spaces will coincide with the non-discounted maximum daily posted rate for the economy surface parking lot spaces at the Phoenix Sky Harbor International Airport as of January 1 of the Contract Year 2017 multiplied by thirty (30). In the event of the elimination of the economy surface parking lot at the Airport, the City will determine the appropriate parking lot and the associated rate therewith as a substitute parking lot operation for the purposes of establishing the Special Needs Parking rate. B. Rate Adjustment. The monthly rate for special needs parking spaces shall be adjusted annually, beginning on January 1 of each Contract Year for the succeeding twelve (12) month period and will be based on the prevailing non-discounted maximum daily posted rate for the economy surface parking lot spaces at the Phoenix Sky Harbor International Airport as of January 1 of the calendar year 2017 multiplied by thirty (30). C. Special Needs Parking Payment. The monthly payment due by Operator to City for its allocation of special needs parking spaces shall be equal to the applicable annual rate multiplied by the number of special needs parking spaces allocated to Operator (Parking Payment). All Parking Payments shall be made by the Operator to the City in the same manner and time as applicable to Operator for the payment of Ground Rent under Operator’s Lease. D. Modification of Special Needs Parking. At the time that the PHX SkyTrain becomes the Common Transportation System providing access to the RCC, the City in its reasonable discretion and after consultation with the On Airport RACs, may reduce the number of Special Needs Parking Spaces as provided in this

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Section, may relocate the Special Needs Parking Spaces at Airport terminals or eliminate Special Needs Parking.

ARTICLE SIX – FINANCIAL SECURITY 6.1 Payment Guaranty The Operator shall provide to the City security to guarantee payment for all amounts due under this Agreement, including all amounts set forth in Article Three of this Agreement. The amount of security will be twenty five percent (25%) of the Minimum Annual Guarantee for the applicable Contract Year as provided herein. The amount of the security will be adjusted accordingly every Contract Year throughout the Term of the Agreement. The security shall be in one of the following forms:

A. An irrevocable letter of credit drawn on a bank doing business in Arizona, using a form as shown on attached Exhibit 8.

B. A bond in a form acceptable to the City provided by a surety authorized to conduct business in Arizona.

C. A form of security approved in writing by the City in its sole discretion.

The City may draw upon the security provided pursuant to this Section in order to satisfy any payment delinquency under this Agreement that remains uncured ten (10) calendar days after written notice, if required, has been given to the Operator. If the City draws upon the security, Operator must replenish the security to its original amount within thirty (30) calendar days after notice of the City’s draw. 6.2 Indemnity and Insurance Operator and its agents, contractors and subcontractors (hereinafter the "Indemnitor"), must indemnify, defend, save and hold harmless the City of Phoenix and its officers, officials, agents, and employees (“Indemnitee”) from and against any and all claims, actions, liabilities, damages, losses, or expenses (including court costs, attorneys’ fees, and costs of claim processing, investigation and litigation) (“Claims”) caused, or alleged to be caused, in whole or in part, by the wrongful, negligent, or willful acts, errors, or omissions, of Operator or any of its owners, officers, directors, agents, employees or contractors, arising out of or in connection with this Agreement. This indemnity includes any Claims arising out of or recovered under the Workers’ Compensation Law or arising out of the failure of Operator to conform to any federal, state or local law, statute, ordinance, rule, regulation or court decree. Operator must indemnify Indemnitee from and against any and all Claims, except those arising solely from Indemnitee’s own negligent or willful acts or omissions. Operator will be responsible for primary loss investigation,

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defense and judgment costs where this indemnification applies. In consideration of the award of this Agreement, Operator waives all rights of subrogation against Indemnitee for losses arising from the work performed by Operator for the City. The obligations of Operator under this provision survive the termination or expiration of this Agreement. In addition, Operator must purchase and maintain insurance in conformity with this Indemnification Clause and with the Insurance Specifications attached hereto as Exhibit 9. ARTICLE SEVEN – DEFAULT AND TERMINATION 7.1 Operator Default and Opportunity to Cure Operator will be in default of this Agreement if it fails to comply with any of its terms and conditions. There are two types of defaults and opportunities to cure:

A. Monetary Default

Operator is in default if it fails to duly and punctually pay the Concession Fees or any other payments, charges, rents or fees required under this Agreement or under the Lease. Except for failure to comply with Section 3.5 of this Agreement, the City shall issue written notice of non-payment to the Operator and the Operator shall have ten (10) days after notice to cure the default. Failure to comply with Section 3.5 of this Agreement is governed by Section 7.2(a) (2) below.

B. Non-monetary Default Operator is in default if it fails to keep, perform and observe any other term or condition set forth in this Agreement, including, but not limited to, the failure by the Operator, or its employees, agents and contractors, to operate in a manner consistent with the uses and standards of service set forth herein and in the Lease. Except as provided in Section 7.2 below, City will issue written notice of the non-monetary default and Operator shall have thirty (30) days after written notice to correct the instance of non-monetary default. 7.2 Termination by City

A. Immediate Termination – No Notice Required

In addition to all other available remedies, the City may terminate this Agreement with no notice if any of the following events occur:

1. Operator fails to cure any default as provided in Section 7.1.

2. Operator fails to comply with Section 3.5 of this Agreement.

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3. Within a six (6) month period the City has issued three (3) written notices of default to the Operator for failure to comply with any one term or condition of this Agreement.

4. Termination of the Lease.

5. Operator becomes insolvent, or takes the benefit of any present or future insolvency statute, or makes a general assignment for the benefit of creditors, or files a voluntary petition in bankruptcy, or a petition or answer seeking an arrangement for its reorganization, or the readjustment of its indebtedness under the federal bankruptcy laws, or under any other law or statute of the United States or of any state thereof, or consents to the appointment of a receiver, trustee, or liquidator of any or substantially all of its property.

6. A petition under any part of the federal bankruptcy laws or an action under any present or future insolvency law or statute, is filed against Operator and is not be dismissed within thirty (30) days after the filing thereof.

7. A transfer or assignment occurs without prior approval of the City.

8. Operator vacates the premises at the RCC. Premises are presumed vacated if the Operator’s space in the customer service building is unmanned during RCC hours of operation for three (3) consecutive days.

9. Operator conducts its operations in a manner that threatens public

safety as determined by the City in conformity with the laws and regulations of the State of Arizona and the City of Phoenix.

10. The City determines that Operator willfully falsified any of its records

or figures so as to deprive the City of any of its rights under the terms of this Agreement or diverted revenue as described in Section 3.3.

10. Operator failed to comply with all applicable laws and regulations of

the United States Government, the State of Arizona, the County of Maricopa, and the City of Phoenix and all agencies thereof, and all rules and/or regulations of the Airport now in effect or hereafter promulgated.

B. Termination by City after Notice

1. In addition to termination as stated above, the City may terminate this Agreement thirty (30) days after written notice by the City if any of the following events occur:

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(a) With written concurrence of Operator, the occurrence of any act that deprives the Operator of the rights, power, licenses, permits, or authority necessary for the proper conduct and operations of the activities authorized herein.

(b) The lawful assumption by the United States Government, or any authorized agency thereof, of the operation, control, or use of the Airport and its facilities, or any part thereof, in such a manner as to substantially restrict Operator’s operations for a period in excess of ninety (90) consecutive days.

2. In addition to termination as stated above, the City may terminate this lease

three (3) days after written notice by the City if the following event occurs:

(a) Operator fails to provide and/or maintain the Financial Security and Insurance required by this Agreement at any time during the Term. If the City does not terminate, Operator must obtain a new or renewed policy that specifically provides the required coverage to the City for any liability arising during the lapsed or previously uncovered period.

7.3 Termination by Operator If Operator is not in default under this Agreement or the Lease, it may terminate this Agreement at any time by giving the City forty-five (45) days advance written notice, upon the happening of any of the following events:

A. Issuance by a court of competent jurisdiction of an injunction in any way preventing or restraining normal use of the Airport or any substantial part of the Airport that remains in force for a period of ninety (90) consecutive days.

B. The inability of Operator to use, for a period in excess of ninety (90) consecutive days, the Airport or any substantial part of the Airport because of embargo, fire, explosion, earthquake, other similar casualty or acts of God or the public enemy, provided that same is not caused by Operator’s negligent acts of omission or commission or its willful misconduct.

C. The lawful assumption by the United States Government, or any authorized agency thereof, of the operation, control, or use of the Airport and its facilities, or any part thereof, in such a manner as to substantially restrict Operator’s operations for a period in excess of ninety (90) consecutive days.

7.4 Waiver

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The failure of the City to insist in any instance or in more than one instance upon a strict performance by the Operator of any of the provisions, terms, covenants, reservations, conditions or stipulations contained in this Agreement shall not be considered as a waiver or relinquishment thereof for the future. No waiver by the City of any provision, term, covenant, reservation, condition or stipulation contained in this Agreement shall be deemed to have been made in any instance unless expressed in the form of a resolution by the City Council. 7.5 Surrender Except where there is a holdover in accordance with Section 2.2, the Operator agrees that upon the expiration of the Term of this Agreement, or at any time if the Operator is no longer permitted to operate a Rental Car Business at the Airport, it will peaceably surrender possession of the premises it occupies under the Lease at the RCC in accordance with the terms and conditions of the Lease. City shall not be required to give notice to quit possession at the expiration date of the Term of this Agreement. ARTICLE EIGHT LEGAL COMPLIANCE 8.1 General Operator shall obey and comply, at its own cost and expense, with all laws and regulations of the United States Government, the State of Arizona, the County of Maricopa, and the City of Phoenix and all agencies thereof, and all rules and/or regulations of the Airport now in effect or hereafter promulgated which may be applicable to its performance under this Agreement (specifically the Supplemental Terms and Conditions attached hereto as s 10). Further, Operator will display to the City any permits, licenses or other evidence of compliance with such laws upon written request. 8.2 Disadvantaged Business Enterprise Program and Discrimination Compliance 8.2.1 Disadvantage Business Enterprise Program

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This Agreement is subject to ACDBE Program requirements issued by USDOT in 49 CFR Parts 23 and 26. Despite the lack of a race- and gender-conscious ACDBE participation goal for this Agreement, the City must track and report ACDBE and DBE participation that occurs as a result of any procurement, JV, goods/services, or other arrangement involving an ACDBE or DBE. For this reason, the Operator shall provide all relevant information to enable the required reporting. The Airport has a national market for small business participation. On Airport RACs are required to provide a corporate Small Business Participation Plan (“Participation Plan”) within 60 days following Agreement execution for City approval; such approval shall not be unreasonably withheld. The Participation Plan shall contain strategies to foster small business participation and information concerning the small businesses, including names of firms and addresses. Every year on the anniversary date of the Agreement, Operator is required to provide to Airport any material changes to the Airport approved Participation Plan. Furthermore, Operator is required to comply with Airport ACDBE Program Plan and 49 CFR Parts 23 and 26. Operator shall track and report all ACDBE, DBE, and/or small business participation that occurs at Airport as a result of a contract, procurements, purchase orders, subleases, JV, goods/services or other arrangements involving sub-tier participation. Such documentation must be entered monthly into the internet based reporting program Business2Government (B2G) System at www.phoenxix.diversitycompliance.com. 8.2.2 Civil Rights Assurances The Operator shall not discriminate on the basis of race, color, national origin, sex, or creed in the performance of this Agreement. The Operator shall carry out applicable requirements of 49 CFR Parts 21 and 23 in the award and administration of USDOT-assisted contracts. Failure by the Operator to carry out these requirements is a material breach of this Agreement, which may result in the termination of this Agreement or such other remedy as the City deems appropriate. 8.3 Governing Law This Agreement shall be construed and enforced in accordance with the laws of the State of Arizona. The venue shall be Maricopa County. ARTICLE NINE - TRANSFER OF INTEREST 9.1 Assignment

http://www.phoenxix.diversitycompliance.com/

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Operator shall not assign, encumber, or otherwise transfer, whether voluntarily or involuntarily or by operation of law, its interest in this Agreement or any part thereof without City's prior written consent. City agrees, however, that it will consent if Operator establishes to the City’s satisfaction that the transferee is qualified to meet all the financial obligations of the Lease and this Agreement and has the requisite experience to operate the Rental Car Business with the appropriate level of customer service under the terms of the Lease and this Agreement. City’s consent to a transfer is subject to City Council approval and shall not be deemed consent to any other subsequent transfers. Any attempt by Operator to perform any of the acts proscribed under this Article without the prior written consent of the City, may be deemed by the City, in its sole absolute discretion, as a breach of this Agreement rendering it null and void. 9.2 Changes in Operator or Rental Car Brands

A. Changes in Operator

For purposes of this Agreement, the merger of the Operator with any other entity or the transfer of any controlling ownership interest in the Operator, or the assignment or transfer of any portion of the assets of the Operator to any entity intended to replace the Operator under the Lease or this Agreement, whether or not located at the Airport, shall constitute a transfer. Without limiting the generality of the foregoing, if Operator is a partnership, a withdrawal or change, voluntary, involuntary or by operation of law of the partner or partners owning fifty one percent (51%) or more of the partnership, or the dissolution of the partnership, shall be deemed a transfer. If Operator is a corporation or limited liability company, any dissolution, merger, consolidation, or other reorganization of Operator which would result in a different Operator under this Agreement, or the sale of at least fifty one percent (51%) of the value of the assets of the Operator, shall be deemed a transfer.

The phrase “controlling percentage” means the ownership of, and the right to vote, stock or interests possessing at least fifty one percent (51%) of the total combined voting power of all classes of Operator’s capital stock or interests issued, outstanding and entitled to vote for the election of directors.

B. Changes in Rental Car Brands

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For purposes of this Agreement and the letting of premises for operations of the Operator’s Rental Car Business under the Lease, and subject to the operation of a Rental Car Brand(s) of Operator by an Affiliate as set forth in Section 9.3 below, Operator commits to continuously operate each of the Rental Car Brands set forth in Exhibit 1 to this Agreement, throughout the Term of this Agreement. The Operator must obtain City’s prior written consent for the cessation or significant diminution of the business in general or the removal of any of Operator’s Rental Car Brands at the Airport, and must likewise obtain City’s written consent to Operator’s request to substitute or add any Rental Car Brands to Operator’s Rental Car Business at the Airport. After consultation with the Operator, the City will provide a written notification to Operator which notification shall set forth the City’s decision on the request for consent to changes in Rental Car Brands as set forth herein, including other relevant terms of Operator’s occupancy of the Premises set forth in the Lease related to such change, and including an updated version of Exhibit 1 (to be attached to this Agreement without necessity of amendment or modification hereto).

Any attempt by Operator to cease the operations, remove, substitute, or add any of Operator’s Rental Car Brands without the prior written consent of the City, may be deemed by the City, in its sole absolute discretion, as a breach of this Agreement. City agrees, however, that it will consent if Operator establishes to the City’s satisfaction that the overall operation of the revised mix of Rental Car Brands does not significantly impair the overall operation of the RCC with the appropriate level of customer service, and meets all the financial expectations and obligations under the terms of the Lease and this Agreement. City also reserves the right as a component of its consent to consider a portion of the Operator’s premises set forth in the Lease as “vacated” and proceed with providing such vacated premises as available for lease pursuant to Section 2.4 of the Lease.

9.3 Consolidation and Affiliates

A. Elimination or Reduction of Operator’s Obligations Operator shall not, without the prior written consent of the City, unite, merge, consolidate or combine, either directly or indirectly, with any other person, firm or corporation whether such uniting, merging, consolidating or combining be through the sale of property or sale of stock or otherwise; or sell or otherwise dispose of all or part of its interests in the legal entity operating at the RCC and thereby eliminate or reduce Operator’s obligations hereunder and under the Lease.

B. Addition of an Affiliate

For purposes of this Agreement, an Affiliate is an entity (1) whose rental car customers will be using the Common Transportation System to transport rental car

38

customers between the Airport terminals or elsewhere on Airport property and the RCC (2) that is not a party to any agreement directly with the City for the operation of an On Airport rental car concession at the Airport, and (3) that is owned and controlled by Operator or by an entity that owns and controls both Operator and Affiliate (“Parent Company”). For this purpose, control shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management, operation, and policies of such entity, whether through the ownership of voting securities, or by contract or otherwise. A company which comes within the definition of Affiliate may be added to this Agreement and considered in the definition of Operator hereunder at the sole discretion of the City, which approval shall not be unreasonably withheld, after meeting the following conditions: (1) Operator has provided prior written notice to the Aviation Director, including a brief explanation as to how such entity satisfies the definition of “Affiliate” herein and specifically how Operator or Parent Company has control of Affiliate; (2) Operator has provided a fully executed copy of any agreement between Operator and each Affiliate authorizing such Affiliate operations at the Airport and evidencing the agreement of Operator and Affiliate that Operator is authorized to enter into any future amendments, restatements, or modifications of the Restated Lease and this Agreement and related documents thereto on behalf of the Affiliate; (3) Operator has requested that City execute a Consent to Affiliate whereby Affiliate agrees to comply with all terms and conditions of this Agreement and the Lease (and any additional laws, rules or regulations applicable thereto, etc.)

Operator shall provide City with written notice within ten (10) days from the date when a previously approved Affiliate is no longer operating as an Affiliate of the Operator for purposes of this Agreement and the Lease. The removal of such Affiliate shall not be grounds for default as long as such removal does not alter Operator’s fulfillment of any obligations of the Lease or this Agreement.

Operator agrees that any approved Affiliates (1) will be added to Exhibit 1 without the requirement for amendment or modification of this Agreement, (2) will be deemed to be included as a component of the entities designated in the operation of Operator’s Rental Car Business, (3) are subject to and must operate in compliance with the terms and conditions of this Agreement, Operator’s Lease, and all related agreements, and (4) must operate from the Premises of Operator under the Lease. Compliance with the terms and conditions of this Agreement and the Lease (as same may be amended) includes, but is not limited to, satisfaction of insurance and indemnification requirements and joint and several liability.

Operator assumes all legal responsibility under this Agreement and the Lease for its Affiliates, including the responsibility to provide payment and compensation to City under this Agreement and the Lease for its Affiliate(s), regardless of whether Affiliate(s) of Operator make such compensation payments to Operator. Operation of any of Operator’s Rental Car Brands under this Agreement and the Operator’s

39

Lease other than those approved in writing by the City for Operator and its Affiliate(s) or any failure of an Affiliate of Operator to comply with the terms and conditions of this Agreement, Operator’s Lease, and all related agreements shall be ground for default of Operator in accordance with Article Seven.

9.4 No Release In no event will City's consent to a transfer or to an operation by an Affiliate of Operator be deemed a release of the primary obligor hereunder. If after obtaining requisite consent, Operator shares all or any part of its interests in its allocation of the Premises or if all or any part of its interest in the RCC is occupied by anyone other than Operator (including any Affiliate or subsidiary of Operator), the City may, but shall not be obligated to, if an event of default shall occur and continue, collect rent from such assignee, Affiliate, subsidiary, or occupant. In such event, the City shall apply the amount collected to the extent possible to satisfy the obligations of Operator, but no such collection shall be deemed a waiver by the City of the obligations, rights and covenants contained in this Agreement or an acceptance by the City of any such shared use, claimant or occupant as a successor Operator, nor a release of Operator by the City from the performance by Operator of the covenants and obligations of Operator under this Agreement. Notwithstanding anything contained in this Agreement to the contrary, no such shared use or assignment shall be authorized if it in any way releases Operator from its primary obligations under this Agreement. ARTICLE TEN – MISCELLANEOUS PROVISIONS 10.1 Notices Except as otherwise specifically provided herein, any notice, demand, or other correspondence given under this Agreement shall be in writing and transmitted by commercial courier, Express Mail, or certified mail (return receipt requested) with postage prepaid.

To the City at: City of Phoenix Aviation Department

Business & Properties Division 2485 East Buckeye Road Phoenix, AZ 85034-4420 Attention: Deputy Aviation Director

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To the Operator at:

«First_Name» «Last_Name» «Title» «Company_Name» «Street_Address» «City», «State» «Zip_Code»

Notice will be deemed given on the date of the delivery to the addresses above. Notice given in compliance with this Article is deemed received two days after it is delivered to a commercial air courier or express delivery service, or by registered or certified mail. Any time period stated in a Notice shall commence on the date the Notice is deemed received. Actual receipt of a Notice is not required. A duplicate notification may be sent by email or facsimile transmission, Duplicate notice is merely a courtesy and does not change or extend the effective date of the Notice. A Party’s failure to receive the duplicate Notice does not affect the validity of the Notice sent by commercial courier, Express Mail, or certified mail. If a Party changes the person or address for Notice, then the Party shall give Notice of the change to the other Party in compliance with this Article. Unless there is a proper change of address, the Parties are not required to give Notice to any person or address other than as set forth in this Article. A Party may not raise failure of or defect in notice as a defense if the Party failed to give the other Party proper Notice that it had changed the person or address for Notice. Notice given orally is invalid. Notice may not be proved with parol evidence.

10.2 Severability If a covenant, term or condition of this Agreement is held to be unlawful, invalid, or unenforceable, the remainder of this Agreement shall remain in effect and fully enforceable. 10.3 Successors and Assigns Bound This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the parties where succession or assignment is permitted by this Agreement. 10.4 Amendments

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Except as specifically provided in this Agreement, neither this Agreement nor any term or provision hereof may be changed, waived, discharged, or terminated, except by a written instrument signed by the Operator and the City. 10.5 Authority to Execute Agreement In the event the Operator is a corporation, a limited liability company, or a partnership, each person executing this Agreement on behalf of Operator does hereby covenant and warrant that Operator is a duly authorized and existing entity duly qualified to do business in the State of Arizona, that Operator has full right and authority to enter into this Agreement, and that each of the person(s) executing this Agreement on behalf is authorized to do so by the officers and Board of Directors of the Corporation. The City may request other evidence reasonably necessary to confirm the foregoing warranties. 10.6 Attorney’s Fees If City shall be made a party to any litigation commenced by or against Operator arising out of this Agreement, the awarding of Attorney’s fees will be as provided in State of Arizona Revised Statute Subsection 12-341.01. Operator is prohibited from being reimbursed from any CFC funds to pay for Attorney’s fees for claims/disputes arising under this Agreement. Each party shall give prompt notice to the other of any claim or suit that may affect the other party. 10.7 Time of the Essence Time is of the essence with respect to all provisions of this Agreement where a performance time period is specified. 10.8 Entire Agreement Subject to any cross reference made to the Lease, the parties intend that this Agreement and exhibits shall be the final expression with respect to the subject matter hereof and may not be contradicted by evidence of any prior or contemporaneous written or oral agreements or understandings. Furthermore, no extrinsic evidence whatsoever (including prior drafts), may be introduced in any judicial or administrative proceeding involving this Agreement, except as specifically provided for by the laws of the State of Arizona. 10.9 No Partnership or Agency

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Nothing contained in this Agreement is intended or shall be construed to create or establish any partnership, agency, joint venture, or association between the parties hereto. 10.10 Cumulative Remedies Except as otherwise provided in this Agreement, all rights and remedies of either party, set forth in this Agreement, shall be nonexclusive and cumulative. 10.11 Force Majeure In the event of any national emergency wherein there is a curtailment of the use of motor vehicles by the general public, or a limitation of the supply of gasoline available for general use either by executive decree or legislative action which, in fact, is a major curtailment of Operator’s operation then, in that event, the MAG provided for in Article Three hereof shall not be required to be paid by Operator during said period. However, Operator shall be obligated to continue to pay the prescribed percentage of Gross Revenue stated in Section 3.1, and if any such national emergency shall continue beyond a period of one (1) year, then either party to this Agreement may terminate the same on sixty (60) days written notice to the other party. Subject to City Council approval, City will provide relief from certain obligations under this Agreement that cannot be performed, in the event of an embargo, fire, explosion, earthquake, or other similar acts of God or the public enemy. However, subject to the paragraph above, Operator will not be relieved of its obligations under Article Three, Article Four, Article Six, or Article Eight of this Agreement. 10.12 Conflict of Interest Operator hereby represents that it is familiar with the provisions of the Phoenix Charter and Arizona Revised Statutes 38-511 and certifies that it knows of no facts which constitute a violation of said Charter. Operator further certifies that it has made a completer disclosure to the City of all facts bearing upon any possible interest, direct or indirect, with it believes any member of the City Council or other officer or employee of the City presently has or will have in this Agreement or in the performance hereof or any portion of the profits hereof. Willful concealment of such facts by Operator shall constitute a material breach of this Agreement and shall be grounds for termination by the City. 10.13 No Third Party Beneficiaries This Agreement is not intended to and does not create any rights for any entity other than the parties to this Agreement. 10.14 Agreements with Other On Airport RACs

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Operator hereby acknowledges that there are two tiers of On Airport RACs operating at the RCC during the Term of this Agreement. On Airport RACs that have a Rental Car Business comprised of three Traditional Rental Car Brands are classified as “Tier One” and On Airport RACs that have a Rental Car Business comprised of no more than two Traditional Rental Car Brands are classified as Independent Operators. Operator acknowledges that certain provisions in the Concession and Lease agreements of Tier One On Airport RACs will be different that those contained in the Concession and Lease agreements for Independent Operators, including but not limited to the Term of the agreements, the reallocation provisions, and the joint use of certain premises; and that the Independent Operators have been selected pursuant to a competitive process that will determine the Minimum Annual Guarantee. The City agrees that during the Term of this Agreement it will not amend this Agreement for any On Airport RAC classified as an Independent Operator, without offering similar terms to all On Airport RACs classified as an Independent Operator at the RCC. The City also agrees that during the Term of this Agreement it will not amend or enter into any Agreement with a Tier One On Airport RAC that does not obligate such Tier One On Airport RAC to pay the same type of fees and obligations set forth in Article Three herein, the applicable rental obligations set forth in Article Four of the Lease and other similar material financial and operational terms required of Independent Operators at the RCC. 10.15 Boycott of Israel In compliance with A.R.S. §§ 35-393 and 35-393.01, Operator that it is not currently engaged in and, for the duration of this Agreement, agrees not to engage in a boycott of Israel as that is defined in A.R.S. § 35-393 10.16 Interpretation All terms defined herein and all pronouns used in this Agreement shall be deemed to apply equally to singular and plural and to all genders. The table of contents, titles and headings of the articles and sections of this Agreement have been inserted for convenience of reference only and are not to be considered a part hereof and shall not in any way modify or restrict any of the terms or provisions hereof. This Agreement and all the terms and provisions hereof shall be liberally construed to effectuate the purposes set forth herein. In the event of any ambiguity contained herein, it shall not be construed for or against any party hereto on the basis that such party did or did not author it. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the dates set forth below, to be effective however on the Effective Date set forth herein.

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City OF PHOENIX, a municipal corporation ____________, City Manager By:

James E. Bennett, A.A.E. Aviation Director

Date:

ATTEST: City Clerk APPROVED AS TO FORM: City Attorney

__________________________, a _________ Contracting Entity

By: Its: Date:

__________________________, a_________ Brand Name

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By: Its: Date: __________________________, a _________

Brand Name2 By: Its: Date:

IOP - Rental Car Center Concession Agreement Exhibit 1 Page 1 of 3

EXHIBIT 1

DESIGNATION OF OPERATOR, RENTAL CAR BRANDS,

AND AFFILIATES


Exhibit 1

Designation of Operator and Rental Car Brands

The Revenue Contract Solicitation and/or the Agreements require that Respondent as the contracting entity (“Contracting Entity”) operate no more than two (2) Rental Car Brands (and in addition as an option, one Car Sharing Brand) at a IOL; and further specifies that all Rental Car Brands identified herein will be (1) included with the Contracting Entity in the definition of Operator in the Agreements and (2) operated at by Respondent at the RCC for the term of the Agreements.

Respondent hereby represents the Contracting Entity and the Rental Car Brands are as forth below.

Contracting Entity –

As stated above, the Contracting Entity is ______________, a __________, dba Company Name Legal Entity

under the trade name ______________________________.

Rental Car Brands – (Maximum of 2)

1. ______________, a __________, dba under the trade name ____________. Company Name Legal Entity


Optional Car Sharing Brand – (Maximum of 1)

Car Sharing Brand means for this Agreement an entity determined by City in its sole discretion, as a car sharing business owned, licensed or otherwise authorized by the City to be operated by Operator, limited to the one (1) brand set forth herein and subject to the provisions of this Agreement, as follows:



Affiliate Operators – (to be added as approved by City)

Affiliate Operator means those entities associated with Operator operating or who may be approved by City to operate at the Rental Car Center and added to this Exhibit 1, subject to the provisions of the Agreement.

As set forth in the Agreement, this Exhibit 1 may be replaced from time to time by the City without amendment or modification to the Agreement to reflect approved changes or additions to the entities comprising the Operator.

IOP - Rental Car Concession Agreement Exhibit 2 Page 1 of 2

EXHIBIT 2

INDEPENDENT OPERATOR PREMISES

RCC Reconfiguration - EUM Exhibits - SOP (1 and 2 companies)April 24, 2017

Garage and Site PlansNOT TO SCALE

1

HERTZ

DOLLAR

THRIFTY

AVIS

BUDGET

ALAMO /NATIONAL

ENTERPRISE

SOP(2 COMPANIES)

SOP(1 COMPANIES)

1,032 sf

82,209 sf

188,794 sf

SOP (1 and 2 companies) CSBNOT TO SCALE

2

2,342 sf

138,365 sf

Garage:Site:CSB:Total:

188,794 sf138,365 sf

2,342 sf329,501 sf

(SOP 2 Companies)(SOP 2 Companies)

Garage:Site:CSB:Total:

188,794 sf82,209 sf

1,032 sf272,035 sf

(SOP 1 Company)(SOP 1 Company)

IOP CSB

IOP SERVICE SITE

IOP GARAGE

EXH

IBIT 2

IOP - R

ental Car C

oncessionExhibit 2

Page 2 of 2

042529

Rectangle

042529

Rectangle

042529

Polygon

042529

Polygon

042529

Rectangle

042529

Rectangle

042529

Polygon

042529

Polygon

042529

Polygon

042529

Polygon

042529

Rectangle

042529

Rectangle

042529

Rectangle

042529

Rectangle


EXHIBIT 3

RENTAL CAR CENTER AND SKY HARBOR CENTER

Rental Car Center

JP Morgan Chase

COP

COP

COP

#

#

#

Union Pacific Rr

#

S 24th

st

S 16th

st

E Jefferson st

1010§̈¦10

§̈¦10

§̈¦17

SkyChefs

COP

Area 3+/- 19 Acres

HoneywellPrologisSRP

Arrow

Area 2+/- 10 Acres

COP +/- 6.3 Acres

801 S 16th St Industrial

Area 1+/- 5.8 Acres

COP+/- 3.5 Acres

FS 16

GPT GIG B of A

Portfolio Owner LLC

American Airlines

Horseheads Industrial

Level 3

Grand Stable & LTJ Skyline

Charlie Case

COP

FOX RAC

DISCLAIMER: DRAWINGS AS INSTRUMENTS OF SERVICE ARE THE PROPERTY OF THE CITY OF PHOENIX AVIATION DEPARTMENT AND MAY NOT BE REPRODUCED OR MODIFIED WITHOUT THE EXPRESS WRITTEN PERMISSION OF THE CITY OF PHOENIX AVIATION DEPARTMENT. DATA SOURCE: PHOENIX AVIATION GEOGRAPHIC INFORMATION SYSTEM

PHOENIX SKY HARBORINTERNATIONAL AIRPORT

CITY OF PHOENIX AVIATION DEPARTMENTTECHNOLOGY DIVISION

APRIL 19, 2017 0 250 500Feet

§̈¦10§̈¦10§̈¦10§̈¦10

§̈¦1 0

§̈¦1 0§̈¦1 7

S 24th

St

Un io n Paci fic RR

E Washington S t

E Sky Harbo r Blvd

E Univ ersity DrS 40th

St

E Jeffer son S t

E Ai r Ln

E Univ ersity Dr

S 40th

St

E Sky Harbor Bl vd

Salt River

Map Extent LocationSky Harbor Center

SHC Tenant BoundarySHC Boundary



EXHIBIT 4

SHARE CALCULATION FORMULA


Exhibit 4

CALCULATION FORMULAS

Share Calculation Formula OL = Operator’s* Leased Premises in the RCC Garage AL = All Leased Space in the RCC Garage Operator’s Share Calculation = OL AL *For purposes of Independent Operators, the IOP is considered a single operator

RCC Operation Maintenance and Repair Calculation $O&M = Forecasted costs to operate, maintain, and repair the non-exclusive areas of the RCC. Operator’s* share of RCC operations, maintenance and repair costs = OL x $O&M AL *For purposes of Independent Operators, the IOP is considered a single operator

IOP Share Calculation Formula IIOP = Individual Independent Operator ready/return parking spaces in the IOP Garage. AIOP = All Independent Operator ready/return parking spaces in the IOP Garage. Independent Operator’s Share Calculation = IIOP AIOP IOP Operation Maintenance and Repair Calculation $O&M = Forecasted costs to operate, maintain, and repair the non-exclusive areas of the IOP. Individual Operator’s share of IOP operations, maintenance and repair costs = IIOP x $O&M AIOP


EXHIBIT 5

***This page is intentionally left blank***


EXHIBIT 6

STATEMENT OF GROSS RECEIPTS


EXHIBIT 6

STATEMENT OF GROSS RECEIPTS

1. -$ 2.3.4.5.6.7.8.9.

10.11.12.13.14.15.

1. Taxes -$ 2. Customer Facility Charge (CFC)3. Sums collected for damage, loss, conversion, or abandonment

-$

(A) -$ (B) -$

is due until paid.

EXCESS OF (B) OVER (A)

Pass Through Airport Concession Fee

Cellular Phone Rental FeesExtended Protection

Additional Driver FeesUnderage Driver Fees

10% OF TOTAL MONTHLY GROSS RECEIPTS

COMPANY NAME OR LETTERHEAD

PHOENIX SKY HARBOR INTERNATIONAL AIRPORTRENTAL CAR GROSS RECEIPTS REPORT FORM

REPORTABLE GROSS RECEIPTS*

MONTH/YEAR:

CALCULATION OF PERMIT FEE

TOTAL MONTHLY GROSS RECEIPTS:

MONTHLY MINIMUM ANNUAL GUARANTEE (MAG)

Delinquent accounts will be assessed interest at the rate of eighteen (18%) per annum from the date such payment

-$

-$

Time & Mileage ChargesDrop ChargesPersonal Accident InsuranceAdvanced Reservation FeesTime & Mileage DiscountsBaby Seats

Total Reportable Gross Receipts:

-

Special Equipment

CDW or LDW CoverageOther Reportable Gross Receipt Items. Please Identify:

EXEMPT GROSS RECEIPT ITEMS*

Prepaid Fuel Charges

AMOUNT DUE:

Total Exempt Gross Receipts:


EXHIBIT 7

***This page is intentionally left blank***


EXHIBIT 8

IRREVOCABLE STANDBY LETTER OF CREDIT EXAMPLE


Sample Letter of Credit Form

[BANK] IRREVOCABLE STANDBY LETTER OF CREDIT

NO. ______________ To: City of Phoenix – Beneficiary Aviation Department Business & Properties Division 3400 East Sky Harbor Boulevard, Suite 3300 Phoenix, Arizona 85034 Attn: Deputy Aviation Director Applicant: Company Name Amount: $ xxx.xx Expiration Date: mm/dd/yyyy We hereby establish our irrevocable Standby Letter of Credit No. _________ in your favor available against sight drafts drawn on (name of bank) at the office of the undersigned located at (address of bank in Phoenix Metro Area, Arizona), accompanied by the following documents: 1. A certificate purportedly signed by the Aviation Director, or by any other director of the City of Phoenix Aviation Department, stating one or more of the following:

A. The City of Phoenix is drawing against (name of bank) Standby Letter of Credit No. _________ as Company Name has failed to perform its obligations under or failed to comply with its Agreement No. , or any amendments thereto, or any replacement agreement, and the City of Phoenix requires payment under this Standby Letter of Credit of $ ____________.

B. The City of Phoenix is drawing against (name of bank) Standby Letter of Credit No. _________ as Company Name has failed to provide a replacement Standby Letter of Credit prior to sixty (60) days before the expiration date as required by its Agreement No. or any amendments thereto, or any replacement agreement, and the City of Phoenix requires payment under this Standby Letter of Credit of $ ____________. C. The City of Phoenix is drawing against (name of bank) Standby Letter of Credit No. _________ as the City of Phoenix has received notice from (name of bank) that the Standby Letter of Credit No. __________ will not be extended,

IOP - Rental Car Center Lease Exhibit 8 Page 3 of 3

and the City of Phoenix requires payment under this Standby Letter of Credit of $ ______________.

2. This original Standby Letter of Credit for endorsement. All documents may be forwarded to us by mail, overnight courier, hand delivered to our counters, or via telefacsimile (“fax”). Documents to be directed to our counters at: [insert address as to counter location]. Drawing presented to us via fax must be sent to our fax number [insert – bank’s fax number] (each such drawing, a “Fax Drawing”) provided, however, that Beneficiary confirm our receipt of any Fax Drawing by telephone to our telephone No. [insert – bank’s telephone number(s)]. In the event of a Fax Drawing, Beneficiary is not required to send us the original documents. If Beneficiary presents an improper drawing, we shall notify you in writing sent by overnight courier or by fax to (602) 273-4083 that the demand was not effected in accordance with the terms and conditions of this Standby Letter of Credit, stating the reasons therefore and that we are holding any demand at your disposal. Upon being notified that the purported demand was not effected in conformity with this Standby Letter of Credit, you may attempt to correct any such nonconforming demand for payment. Partial drawing and multiple presentations are permitted under this Standby Letter of Credit. This Standby Letter of Credit will automatically be renewed for a one (1) year period from the Expiration Date set forth above and upon each anniversary of such Expiration Date, unless at least sixty (60) days prior to such expiration, or prior to any anniversary of such expiration, we notify both Beneficiary and Applicant in writing by registered mail or overnight courier that we elect not to renew this Standby Letter of Credit. We hereby agree that this Standby Letter of Credit shall be duly honored upon presentation and delivery of the certification specified above. This Standby Letter of Credit is subject to the "International Standby Practices (ISP98)," International Chamber of Commerce Publication No. 590, and, as to matters not governed by ISP98, shall be governed by and construed in accordance with the laws of Arizona, without regard to principles of conflicts of law. [Bank] By: Authorized Signature


EXHIBIT 9

INSURANCE REQUIREMENTS


EXHIBIT 9

INSURANCE REQUIREMENTS Operator and sublessees must procure insurance against claims that may arise from or relate to the occupancy and use of the Leased Premises by Operator and its agents, representatives, employees and sublessees. Operator and sublessees must maintain that insurance until all of their obligations have been discharged, including any warranty periods under this Agreement. These insurance requirements are minimum requirements for this Agreement and in no way limit the indemnity covenants contained in this Agreement. The City in no way warrants that the minimum limits stated in this section are sufficient to protect the Operator from liabilities that might arise out of this Agreement. Operator is free to purchase such additional insurance as Operator determines necessary. A. MINIMUM SCOPE AND LIMITS OF INSURANCE: Operator must provide coverage with

limits of liability not less than those stated below. An excess liability policy or umbrella liability policy may be used to meet the minimum liability requirements provided that the coverage is written on a “following form” basis.

1. Commercial General Liability – Occurrence Form

Policy must cover liability arising from premises, operations, independent contractors, products-completed operations, personal and advertising injury and liability assumed under an insured contract. General Aggregate $4,000,000 Products – Completed Operations Aggregate $2,000,000 Personal and Advertising Injury $2,000,000 Each Occurrence $2,000,000 Fire Damage (Damage to Rented Premises)* $1,000,000

a. The policy must be endorsed to include the following additional insured language: “The

City of Phoenix is named as an additional insured with respect to liability arising out of the use and/or occupancy of the property subject to this Agreement.”

2. Automobile Liability

Bodily Injury and Property Damage for any owned, hired, and non-owned vehicles used in Operator’s operations.

Combined Single Limit (CSL) $1,000,000 a. Policy must not contain any restrictions of coverage with regard to operations on airport premises.

3. Worker's Compensation and Employers' Liability

Workers' Compensation Statutory Employers' Liability

Each Accident $100,000 Disease – Each Employee $100,000 Disease – Policy Limit $100,000

a. Policy must contain a waiver of subrogation against the City of Phoenix.


b. This requirement shall not apply when a contractor or subcontractor is exempt under A.R.S. 23-901, AND when such contractor or subcontractor executes the appropriate sole proprietor waiver form.

4. Pollution Legal Liability

If Operator’s operations include the acceptance, transport, storage or disposal of any hazardous materials or regulated substances, Operator must provide coverage with limits of at least: Per Occurrence $1,000,000 Annual Aggregate $2,000,000

a. The policy should be written on an “occurrence” basis with no sunset clause or if

written on a “claims-made” basis, it must be maintained for a period of not less than 8 years with the retroactive date to be prior to or held constant with the date of this contract.

b. Such insurance must name the City of Phoenix as Additional Insureds with respect to liability arising out of the activities performed by, or on behalf of the Operator.

c. The policy must include coverage for:

1. On and off-site cleanup of sudden and gradual pollution conditions arising from the Operator’s facility.

2. Third-party claims for on and off-site bodily injury including sickness, disease,

mental anguish or shock sustained by any person, including death and medical monitoring costs.

3. Third-party claims for property damage including physical injury to or destruction

of tangible property including the resulting loss of use thereof, cleanup costs and the loss of use of tangible property that has not been physically injured or destroyed and diminution in value.

4. Claims resulting in bodily injury, property damage or cleanup costs associated with

a pollution condition from transported cargo, if Operator requires the transportation of any hazardous materials as part of its operations.

5. Defense including costs, charges and expenses incurred in the investigation,

adjustment or defense of claims for such compensation damages. 5. Property Insurance

Coverage for Operator’s tenant improvements Replacement Value Coverage for building Replacement Value (only required if Operator is sole occupant of the building) a. Property insurance must be written on an all risk, replacement cost coverage, including coverage for flood and earth movement. b. The City of Phoenix must be named as a loss payee on property coverage for tenant improvements. c. Policy must contain a waiver of subrogation against the City of Phoenix.

B. ADDITIONAL INSURANCE REQUIREMENTS: The policies must include, or be endorsed

to include, the following provisions:


1. On insurance policies where the City of Phoenix is named as an additional insured, the

City of Phoenix is an additional insured to the full limits of liability purchased by the Operator even if those limits of liability are in excess of those required by this Agreement.

2. The Operator’s insurance coverage must be primary insurance and non-contributory with

respect to all other available sources. C. NOTICE OF CANCELLATION: For each insurance policy required by the insurance

provisions of this Agreement, the Operator must provide to the City, within 2 business days of receipt, a notice if a policy is suspended, voided or cancelled for any reason. Such notice must be mailed, emailed, hand delivered or sent by facsimile transmission to (City of Phoenix Department Representative’s Name & Address & Fax Number).

D. ACCEPTABILITY OF INSURERS: Insurance is to be placed with insurers duly licensed or

authorized to do business in the state of Arizona and with an “A.M. Best” rating of not less than B+ VI. The City in no way warrants that the above-required minimum insurer rating is sufficient to protect the Contractor from potential insurer insolvency.

E. VERIFICATION OF COVERAGE: Operator must furnish the City with certificates of insurance

(ACORD form or equivalent approved by the City) as required by this Agreement. The certificates for each insurance policy are to be signed by a person authorized by that insurer to bind coverage on its behalf.

All certificates and any required endorsements are to be received and approved by the City

before the Agreement commences. Each insurance policy required by this Agreement must be in effect at or prior to commencement of this Agreement and remain in effect for the duration of the Agreement. Failure to maintain the insurance policies as required by this Agreement or to provide evidence of renewal is a material breach of contract.

The City Department, Agreement number and location description are to be noted on the

certificate of insurance. The City reserves the right to require complete, certified copies of all insurance policies and endorsements required by this Agreement at any time. DO NOT SEND CERTIFICATES OF INSURANCE TO THE CITY’S RISK MANAGEMENT DIVISION.

The initial certificates required by this Agreement shall be sent directly to:

City of Phoenix, Aviation Department Business and Properties Division 2485 E. Buckeye Road Phoenix, AZ 85034-4301 ATTN: Commercial Use Permit Administrator Fax Number: 602-273-4083 Email: [email protected]

All subsequent and renewal certificates of insurance and endorsements shall be sent

directly to: City of Phoenix, Aviation Department c/o EBIX RCS P.O. Box 100085 – 76 Duluth, GA 30096 Fax #: 770-325-3339

mailto:[email protected]


Email: [email protected] F. APPROVAL: Any modification or variation from the insurance requirements in this Agreement

must have prior approval from the City of Phoenix Law Department, whose decision is final. Such action will not require a formal amendment, but may be made by administrative action.

mailto:[email protected]


EXHIBIT 10

SUPPLEMENTAL TERMS AND CONDITIONS


EXHIBIT 10

SUPPLEMENTAL TERMS AND CONDITIONS TO ALL AIRPORT AGREEMENTS

A. Definitions

1. "Airport" means Phoenix Sky Harbor International Airport, Phoenix Deer Valley Airport and/or Phoenix Goodyear Airport, in accordance with the context of the contract.

2. "Contract" includes any and all City of Phoenix Aviation Department

contracts, subcontracts, agreements, leases, subleases, licenses, permits, concessions or other documents, however denominated that grant or convey a right or privilege on an Airport, and to which this Exhibit is annexed and made a part thereof.

3. "Contractor" means every lessee, sublessee, licensee, permittee,

concessionaire or other person, firm or corporation exercising a right or privilege on an airport pursuant to a contract, and includes Contractor's heirs, personal representatives, successors-in-interest and assigns.

4. "Premises" means the leasehold or site occupied by Contractor pursuant

to the lease, license or permit that is the subject of this Contract. B. Assurances

1. Contractor shall furnish its services on a fair, equal and not unjustly discriminatory basis to all users of the Airport.

2. Contractor shall charge fair, reasonable and not unjustly discriminatory

prices for each unit or services; provided that, Contractor may be allowed to make reasonable and non-discriminatory discounts, rebates or other similar types of price reductions to volume purchasers. Non-compliance with this requirement shall be a material breach of this Contract for which the City of Phoenix shall have the right to terminate this Contract and any estate created herewith, without liability therefor; or, at the election of the City of Phoenix or the United States, either or both of said Governments shall have the right to judicially enforce said requirement.

3. Contractor warrants that no person shall, on the grounds of race, creed,

color, national origin, sex, age or disability, be excluded from participating in any activity conducted on or from the Premises, or otherwise be excluded from the benefits offered by Contractor to the general public. Contractor further warrants that it will comply with all pertinent statutes, Executive Orders, and rules promulgated thereunder, to assure that no person is excluded on the grounds of race, creed, color, national origin,


sex, age, or disability, including, without limitation, Section 504 of the Rehabilitation Act of 1973, and the Americans with Disabilities Act of 1990.

4. As a part of the consideration for this Contract, Contractor does hereby

covenant and agree that in the event facilities are constructed, maintained, or otherwise operated on the Premises for a purpose for which a DOT program or activity is extended for another purpose involving the provision of similar services or benefits, Contractor shall maintain and operate such facilities and services in compliance with all other requirements imposed pursuant to Code of Federal Regulations, Title 49, DOT, Subtitle A, Office of the Secretary of Transportation, Part 21-Nondiscrimination in Federally-Assisted Programs of the Department of Transportation--Effectuation of Title VI of the Civil Rights Act of 1964, as said regulations exist and may be amended from time-to-time.

If this Contract is a lease, then this Covenant is hereby made a covenant running with the land for the term of the lease, and is judicially enforceable by the United States.

5. As a part of the consideration of the Contract, Contractor does hereby

covenant and agree that: (1) no person on the grounds of race, color or national origin shall be excluded from participation in, denied the benefits of, or be otherwise subjected to discrimination in the use of said facilities; (2) in the construction of any improvements on, over or under such Premises and the furnishing of services thereon, no person on the grounds of race, color or national origin shall be excluded from participation in, denied the benefits of, or otherwise be subjected to discrimination; and that the contractor shall use the Premises in accordance with all other requirements imposed pursuant to 49 C.F.R. Part 21, as it may be amended.

If this Contract is a lease, then this Covenant is hereby made a covenant running with the land for the term of the lease, and is judicially enforceable by the United States.

6. The foregoing discrimination covenants are a material part of this Contract

and for breach thereof the City of Phoenix shall have the right to terminate this Contract and to reenter and repossess the Premises and facilities thereon, and hold the same as if said Contract had never been made. This provision does not become effective until the procedures of 49 CFR Part 21 are followed and completed, including expiration of appeal rights.

7. Contractor agrees to insert the foregoing six provisions in any contract by

which Contractor grants a right or privilege to any person, firm or corporation to render accommodations and/or services to the public on or from the Premises.


8. Contractor agrees that it will undertake an affirmative action plan in conformance with 14 CFR Part 152, Subpart E, to insure that no person shall on the grounds of race, creed, color, national origin or sex be excluded from participating in any employment, contracting or leasing activities covered in 14 CFR Part 152, Subpart E. Contractor assures that no person will be excluded on such grounds from participating in or receiving the services or benefits of any program or activity covered by Subpart E. Contractor further agrees that it will require its covered suborganizations to provide assurances to Contractor that they similarly will undertake affirmative action programs and that they will require like assurances from their suborganizations, as required by 14 CFR Part 152, Subpart E.

9. City of Phoenix reserves the right to further develop, improve, repair and

alter the Airport and all roadways, parking areas, terminal facilities, landing areas and taxiways as it may reasonably see fit, free from any and all liability to Contractor for loss of business or damages of any nature whatsoever to Contractor occasioned during the making of such improvements, repairs, alterations and additions.

10. The City of Phoenix reserves the right, but is in no way obligated to

Contractor, to maintain and keep in repair the landing area of the Airport and all publicly owned facilities of the Airport, together with the right to direct and control all activities of Contractor in this regard.

11. Contractor acknowledges that this Contract is subordinate to any existing

or future agreement between the City of Phoenix and the United States concerning the development, operation or maintenance of the Airport. In the event that FAA or its successors require modifications or changes in the Contract as a condition to the obtaining of funds for improvements at the Airport or as a requirement of any prior grants, Contractor hereby consents to any and all such modifications and changes as may be reasonably required and agrees that it will adopt any such modifications or changes as part of this Contract.

12. The Contract is subordinate to the reserved right of the City of Phoenix, its

successors and assigns, to occupy and use for the benefit of the public the airspace above the Premises for the right of flight for the passage of aircraft. This public right of flight shall include the right to cause in said airspace any noise inherent in the operation of any aircraft through said airspace or in landing at or taking off from, or operation on an Airport.

13. Contractor agrees to comply with the notification and review requirements

as required by Title 14 of the Code of Federal Regulations, 14 CFR Part 77- Objects Affecting Navigable Airspace, in the event future construction of a structure is planned for the Premises, or in the event of a planned modification of a structure on the Premises. Contractor shall submit the required FAA Form 7460-1— Notice of Proposed Construction or


Alteration—and provide documentation showing compliance with the federal requirements. Once the FAA has completed the aeronautical study, Contractor shall provide to the City of Phoenix the FAA determination letter on proposed construction and any impact to air navigation. Contractor covenants for itself, its successors and assigns that it will not erect or permit the erection of any structure or permit the growth of any tree, on the Premises above the mean sea level elevation for: (1) Phoenix Sky Harbor International Airport, 1,133 feet; (2) Phoenix Goodyear Airport, 968 feet; (3) Phoenix Deer Valley Airport, 1,476 feet. As a remedy for the breach of said covenant the City of Phoenix reserves the right to enter upon the Premises and remove the offending structure or cut the offending tree, all at the expense of Contractor.

14. Contractor, by accepting this Contract, covenants for itself, its successors

and assigns that no use will be made of the Premises that might in any manner interfere with the landing and taking off of aircraft from the Airport, or otherwise constitute a hazard to air navigation. As a remedy for the breach of said covenant the City of Phoenix reserves the right to enter upon the Premises and cause the abatement of such interference, all at the expense of Contractor.

15. Contractor acknowledges that nothing contained in this Contract shall be

construed to grant or authorize the granting of an exclusive right within the meaning of 49 U.S.C. §40103(e).

16. This Contract and all the provisions hereof are subordinate to whatever

rights the United States now has or in the future may acquire affecting the control, operation, regulation and taking-over of the Airport, or the exclusive or non-exclusive use of the Airport by the United States during a time of war or national emergency.

17. If the Contract involves construction, the contractor shall carry out the

project in accordance with FAA airport design, construction and equipment standards and specifications current on the date of project approval.

18. Contractor is encouraged to use fuel and energy conservation practices.

C. City of Phoenix Equal Employment Opportunity Requirement

1. If Contractor is by this Contract a supplier to, or lessee of, the City, then the requirements of the Phoenix City Code, Chapter 18, Article V applies, including the agreement that:


“Any supplier/lessee in performing under this contract shall not discriminate against any worker, employee or applicant, or any member of the public, because of race, color, religion, sex, national origin, age, or disability, nor otherwise commit an unfair employment practice. The supplier and/or lessee shall ensure that applicants are employed, and employees are dealt with during employment without regard to their race, color, religion, sex, national origin, age, or disability, and shall adhere to a policy to pay equal compensation to men and women who perform jobs that require substantially equal skill, effort, and responsibility, and that are performed within the same establishment under similar working conditions. Such action shall include but not be limited to the following: employment, promotion, demotion or transfer, recruitment or recruitment advertising, layoff or termination; rates of pay or other forms of compensation; and selection for training; including apprenticeship. The supplier further agrees that this clause will be incorporated in all subcontracts with all labor organizations furnishing skilled, unskilled and union labor, or who may perform any such labor or services in connection with this contract.” Supplier/lessee further agrees that this clause will be incorporated in all subcontracts, job-consultant agreements or subleases of this agreement entered into by supplier/lessee.

If the supplier/lessee employs more than thirty-five employees, the following language shall be included as the last paragraph to the clause above:

“The supplier/lessee further agrees not to discriminate against any worker, employee or applicant, or any member of the public, because of sexual orientation or gender identity or expression and shall ensure that applicants are employed, and employees are dealt with during employment without regard to their sexual orientation or gender identity or expression.”

2. Documentation. Suppliers and lessees may be required to provide

additional documentation to the Equal Opportunity Department affirming that a nondiscriminatory policy is being utilized.

3. Monitoring. The Equal Opportunity Department shall monitor the

employment policies and practices of suppliers and lessees subject to this article as deemed necessary. The Equal Opportunity Department is authorized to conduct on-site compliance reviews of selected firms, which may include an audit of personnel and payroll records, if necessary.


D. Immigration Reform and Control Act of 1986 (IRCA)

Contractor understands and acknowledges the applicability of the IRCA to it. Contractor agrees to comply with the provisions of IRCA as it applies to its activities under this Contract and to permit the City of Phoenix to inspect its personnel records to verify such compliance.

E. Conflict of Interest

Contractor acknowledges that the terms and conditions of Arizona Revised Statutes (A.R.S.) § 38-511 are incorporated into this Contract.

F. Legal Worker Requirements The City is prohibited by A.R.S. § 41-4401 from awarding an agreement to any

contractor who fails, or whose subcontractors fail, to comply with A.R.S. § 23-214(A). Therefore, Contractor agrees that:

1. Contractor and each subcontractor it uses warrants their compliance with

all federal immigration laws and regulations that relate to their employees and their compliance with § 23-214, subsection A.

2. A breach of warranty under paragraph 1 shall be deemed a material

breach of the Agreement and is subject to penalties up to and including termination of the Agreement.

3. The City retains the legal right to inspect the papers of the Contractor or

subcontractor employee(s) who work(s) on this Agreement to ensure that Contractor or subcontractor is complying with the warranty under paragraph 1.

G. Disadvantaged Business Enterprise Requirements

1. To the extent that this Contract is covered by 49 CFR Part 26, Contractor agrees that this Contract is subject to the requirements of the U.S. Department of Transportation Regulations at 49 CFR Part 26. The Contractor or subcontractor shall not discriminate on the basis of race, color, national origin, or sex in the performance of this contract. The Contractor shall carry out applicable requirements of 49 CFR Part 26 in the award and administration of DOT assisted contracts. Failure by the Contractor to carry out these requirements is a material breach of this contract, which may result in the termination of this contract or such other remedy as the recipient deems appropriate.

Contractor agrees to include the foregoing statement in any subsequent Contract that it enters and cause those businesses to similarly include said statement in further agreements.


2. To the extent that the Contract is a concession agreement covered by 49 CFR Part 23, the concessionaire or contractor agrees that it will not discriminate against any business owner because of the owner's race, color, national origin, or sex in connection with the award or performance of any concession agreement, management contract, or subcontract, purchase or lease agreement, or other agreement covered by 49 CFR Part 23.

The concessionaire or contractor agrees to include the above statements in any subsequent concession agreement or contract covered by 49 CFR Part 23, that it enters and cause those businesses to similarly include the statements in further agreements.

1245528 Rev. 07/19/16

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