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HomeMy WebLinkAboutResolution - 2018-R0107 - Avis Rent A Car - 03/22/2018Resolution No. 2018-RO 107 Item No. 6.8 March 22, 2018 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock is hereby authorized and directed to execute for and on behalf of the City of Lubbock, an Agreement for On -Airport Rental Car Concession Services at Lubbock Preston Smith International Airport, by and between the City of Lubbock and Avis Rent A Car System, LLC, and related documents. Said Agreement is attached hereto and incorporated in this resolution as if fully set forth herein and shall be included in the minutes of the City Council. Passed by the City Council on March 22 2018 (o�� - DANIEL M. POPE, MAYOR ATTEST: P, �'Y" a , )K� Reb t a Garza, City Secret y APPROVED AS TO CONTENT: Car%pbell, Executive Director of Aviation APPROVEXAS TO/FORM: First Assistant City Attorney ccdocs/RES.LPSIA Rental Car Agreement.Avis 02.23.2018 Resolution No. 2018-RO107 THE STATE OF TEXAS § KNOW ALL MEN BY THESE PRESENTS: COUNTY OF LUBBOCK § LEASE AGREEMENT This Agreement (referred to herein as "Agreement") entered into by the City of Lubbock (referred to herein as "City"), a Home Rule Municipality of Lubbock County, Texas, and Avis Rent A Car System, LLC (referred to herein as "Lessee"). WITNESSETH WHEREAS, City owns, controls, and operates the Lubbock Preston Smith International Airport (referred to herein as "Airport"), situated at 5401 North Martin Luther King Boulevard, Lubbock, Lubbock County, Texas, and has the authority to grant certain rights and privileges with respect thereto, including those hereinafter set forth; and WHEREAS, automobile rental services at the Airport are an integral part of the necessary accommodations for ground transportation provided for passengers arriving at and departing from the Airport in the promotion and development of air commerce and air transportation; and WHEREAS, Lessee desires to make said automobile rental services available at the Airport and is qualified and has the capacity to perform said services and to equip said facilities for use in connection therewith, and further desires to lease certain space and obtain certain rights and privileges with respect to the operation of an automobile rental service at the Airport upon the terms and conditions hereinafter set forth; NOW THEREFORE, for and in consideration of the mutual promises, covenants, terms, and conditions, both general and special, as hereinafter set forth, City hereby grants to Lessee the rights and privileges hereinafter described; Lessee agrees to accept the duties, responsibilities, and obligations as hereinafter set forth; and the parties hereto, for themselves, their successors, and assigns agree as follows: ARTICLE ONE LEASE OF DESCRIBED PREMISES City, upon mutual execution of this Agreement, does lease and demise to Lessee, upon the terms and conditions contained herein, the following premises located at the Airport ("Leased Premises"): A. CUSTOMER SERVICE COUNTER — Rental Car Counter locations as shown on Exhibit "A", which is attached to this Agreement and incorporated herein. B. READY/RETURN VEHICLE PARKING AREA — Rental Car Ready/Return Parking Spaces as shown on Exhibit `B", which is attached to this Agreement and incorporated herein. C. QUICK TURNAROUND/SERVICE FACILITY — Rental Car Quick Turnaround/Service Facility ("QTA") as shown on Exhibit "C", which is attached to this Agreement and incorporated herein. D. SERVICE FACILITY — Rental Car Service Facility at a location and of a size yet to be determined by the City. Lessee understands and agrees that its Service Facility may be relocated by the City to a temporary location to facilitate construction of the QTA. E. LOCATION AND REALLOCATION. Customer Service Counters - The location of Lessee's Customer Service Counter will not be reallocated, however, the Airport reserves the right to relocate all the customer service counters within the terminal building during the Term of the Agreement. At such time the lessees are to select the relocated service counter location, the Lessee with the highest Market Share (gross revenues paid to the Airport as a percentage of total gross revenues paid to the Airport by all lessees) for the previous twelve (12) calendar months will be offered the first choice of location. The lessee with the next highest Market Share will be offered the next choice, and so on until all counters have been selected. Ready/Return Lot — Effective as of the commencement of the third (3rd) Agreement year, the ready/return spaces shall be reallocated by the Executive Director of Aviation of City (referred to herein as "Director") and every two (2) years thereafter according to the percentage derived by comparing the aggregate concession fees paid by each lessee compared to the total of all concession fees paid by all lessees during the twelve (12) months of the prior Agreement year, and only if the Market Share of any one or more Rental Car Lease Agreement Page 2 lessees is 15% higher or lower compared to that lessee's individual Market Share at the end of the first Agreement year (if such reallocation occurs at the commencement of Agreement Year 3), and as compared to that lessee's Market Share in the most recent prior reallocation in all subsequent reallocations. TA - The size and location of car wash and fuel island space in the QTA during the Term of the Agreement will not be reallocated. Provided however, Lessee's vehicle staging and storage space rows in the QTA shall be reallocated by the City every two (2) Agreement years, in full row increments, and only if the Market Share of any one or more lessees is 15% higher or lower compared to that lessee's individual Market Share at the end of the first Agreement year for the first reallocation at the commencement of Agreement Year 3, and as compared to that lessee's Market Share in the most recent prior reallocation in all subsequent reallocations. For lessees that are owned/controlled by the same company, the aggregate company concession fees paid will be used in calculating Market Share for reallocation of QTA space. Each lessee involved in or affected by any reallocation of ready/return spaces or QTA vehicle staging and storage rows as identified in this section is solely responsible for the reallocation costs and expenses incurred as a result of the reallocation. ARTICLE TWO TERM & HOLDOVER The Term of this Agreement shall be for ten (10) years commencing on September 1, 2018 ("Commencement Date") and ending on August 31, 2028 ("Expiration Date"). Upon mutual agreement by the parties, the Term of this Agreement may be extended for up to two (2) additional five (5) year periods by mutual written agreement, no later than six (6) months prior to expiration date of original Term or expiration of the first five (5) year extension, whichever applies. Notwithstanding, the City reserves the right to re -negotiate terms of this Agreement and the agreements of all other lessees effective at the commencement of the sixth (6t') Agreement year. In such event, City will notify Lessee no later than twelve (12) months prior to the expiration of the fifth (5t') Agreement year of its election to re -renegotiate the terms of this Agreement. The terms subject to such renegotiation could include, but are not limited to, a modified Minimum Annual Guarantee (MAG), a modified Percentage Fee, a modified definition Rental Car Lease Agreement Page 3 of Gross Revenues, and Rents. Lessee hereby acknowledges and agrees that the City has advised Lessee of the City's right and option to require the periodic re -opening of the business terms of this Agreement for negotiation. If lessees representing more than fifty percent (50%) of the Market Share for the previous twelve (12) months (the "Majority in Interest") and the City reach agreement on proposed modified terms in connection with the renegotiation, those terms will constitute terms of a renegotiated offer to all lessees subject to acceptance by the lessees, and final approval by the parties. If the Majority in Interest and the City are unable to reach agreement on the proposed modified terms, the City will have the right to reaffirm the terms of this Agreement without revision, or to terminate this Agreement and the agreements of all other lessees, in accordance with the Agreement. Upon the approval of any such changes, the City will provide Lessee with either a copy of such changes or a restated agreement reflecting such changes. In the event Lessee remains in possession of the Leased Premises after the expiration of this Agreement or any extension thereof, without the consent of the City and without any written renewal or extension of the Agreement, such holding over shall not be deemed as a renewal or extension of this Lease, and may be terminated at any time by the Director. Notwithstanding any provision of this Article, this Agreement is subject to earlier termination as set forth in Article Nine. ARTICLE THREE USE OF PREMISES The Lessee is granted for the Term a non-exclusive privilege of conducting a transient automobile rental service and for no other purpose, from the Leased Premises. The Lessee is prohibited from operating vehicle sharing and/or valet service programs. This Agreement is between the City and Lessee operating under one (1) brand name. Brand names shall not be changed, substituted, or added during the Term of this Agreement. Lessee agrees to confine parking of its rental vehicles within its Ready/Return Vehicle Parking Area premises. Lessee is prohibited from parking its vehicles on any of the curbs, entrance roads, or grass areas on Airport property. Lessee is prohibited from allowing Airport patrons to park personal vehicles in any of Lessee's Ready/Return Vehicle Parking premises. Lessee shall be responsible for compliance with the requirements and directives of the Rental Car Lease Agreement Page 4 Transportation Security Administration, including but not limited to its "300 foot rule". Lessee's rental vehicles parked in any of the Airport's public parking lots shall accrue charges in accordance with current parking rates. The City has no obligation to detect or report Lessee's vehicles parked in public parking lots. ARTICLE FOUR PRECENTAGE FEE, MAG, GROSS REVENUES, RENTS, RECORDS, AND PAYMENTS A. PERCENTAGE FEE AND MINIMUM ANNUAL GUARANTY 1. The Lessee shall pay to the City the greater of TEN PERCENT (10%) of Lessee's annual gross revenue (hereinafter Lessee's "Percentage Fee") or Lessee's applicable Minimum Annual Guarantee ("MAG") for each year during the Term of this Agreement. Lessee's MAG for the first Agreement year is depicted on Exhibit "F". For the second Agreement year and for every Agreement year thereafter, the City will reset Lessee's MAG to an amount equal to 85% of the Percentage Fee paid by the Lessee to the City for the prior Agreement year, but in no event shall Lessee's MAG during the Term of the Agreement be less than the MAG for the first Agreement year. 2. All payments must be received by the City on or before the twentieth (20th) day of each month during the Term of this Agreement. Percentage Fee payments must be accompanied by a verified statement containing an itemized summary of the preceding month's gross revenue ("Monthly Gross Receipts Report"). All payments shall be made to Lubbock Preston Smith International Airport, 5401 N. Martin Luther King Boulevard, Unit 389, Lubbock, Texas 79403. Lessee shall pay City a late payment charge of five percent (5%) of the total amount payable if payment is not received by City on or before the 20th day of the month. B. GROSS REVENUES DEFINED As used herein, the term "Gross Revenue" shall mean the total amount actually charged by Lessee for or in connection with the use of a vehicle and any additional services or accessories contracted for, delivered, rented to, or picked up at the Airport, as shown on the vehicle rental contract, regardless of where, how (cash, credit, or barter) or by whom the payment is made or where the vehicle is returned. Unless revenues are expressly and Rental Car Lease Agreement Page 5 particularly excluded from Gross Revenues under this Agreement, such revenues shall be included in Gross Revenues. Revenues derived from sources similar but not identical to those described herein shall also be included in Gross Revenues unless expressly excluded by this Agreement. 1. Gross Revenues shall include, but not be limited to: a) All time and mileage revenues. b) A separate statement of and charge for the Percentage Fee on customer invoices or rental agreements ("Recovery Fee"), provided that such Recovery Fee meets all of the following conditions: (a) such Recovery Fee must be titled "Concession Recovery Fee," "Concession Recoupment Fee" or such other name first approved by the City in writing; (b) the Recovery Fee must be shown on the customer rental agreement and invoiced with other charges (i.e. "above the tax line"); (c) the Recovery Fee as stated on the invoice and charged to the customer shall be no more than eleven and eleven one hundredths percent (11.11%) of Gross Revenues, specifically excluding from Gross Revenues for purposes of this calculation the Recovery Fee; (d) Concessionaire shall neither identify, treat, or refer to the Recovery Fee as a tax, nor imply that the City is requiring the pass through of such fee; c) All revenues from the sale of liability damage waiver, collision damage waiver, personal accident insurance, or any waiver or other insurance products. d) All revenues relating to furnishing and/or replacing fuel provided by Lessee at the commencement or conclusion of the rental transaction. e) Daily and weekly service fees for toll transponders or similar license plate recognition services. f) Cellular phones and global positioning navigation systems (GPS). g) Child restraints. h) Drop charges. i) Additional driver fees. j) Underage or overage driver fees. k) Guaranteed reservation fees. Rental Car Lease Agreement Page 6 1) Third parry vehicle comps for promotional services rendered as a travel promoter, agent, or otherwise. m) All other revenues paid or due to Lessee arising out of or in connection with its operations at the Airport unless expressly excluded by this Agreement. 2. Gross Revenues shall not include: a) Amounts of any Federal, State, or municipal taxes and surcharges separately stated on the Vehicle Rental Contract and collected from Airport Customers, and which are payable directly to the taxing authority by Lessee. No exclusion shall be allowed for taxes levied on Lessee's activities, facilities, equipment, or real or personal property, payroll taxes, income taxes, taxes on frequent flyer miles paid directly to the airline, license or tag fees, or other charges which recoup operating costs. b) Fees charged to customers for carbon offset or other environmental programs. c) Customer Facility Charges. d) Amounts for credits, refunds, or adjustments to customers for transactions made at the Airport at the time of, or prior to the close-out of the rental transaction and shown on the vehicle rental contract (without mark-up or additional fees). Includes customer satisfaction program adjustments applicable to revenues included in Gross Revenues which are subsequently refunded by Lessee and recorded and reported in a separately documented account from non -excludable adjustments. Lessee forfeits exclusion of all customer satisfaction program adjustments in the event otherwise allowable adjustments are commingled with any non -excludable amounts. Non - excludable adjustments are those which affect amounts already excludable from Gross Revenues (example: taxes) since this would result in a duplicate deduction from Gross Revenues. e) Any discounts separately stated on the vehicle rental contract which are granted at the time the rental transaction commences, and are recorded and reported in separately documented accounts from non -excludable discounts. Lessee forfeits exclusion of all discounts in the event otherwise allowable discounts are commingled with any non -excludable amounts. No exclusion Rental Car Lease Agreement Page 7 shall be allowed for any amount retained by a third party as a financing discount which may apply by reason of Lessee's acceptance of credit cards or other credit arrangements. No exclusion shall be allowed for the portion of retroactive rebates, dividends or refunds to any Airport Customer upon attainment of a specified volume of rentals attributable to revenue or as part of any other marketing plan which does not list the discount on the vehicle rental contract at the commencement of the rental transaction. f) Sums received by reason of Lessee's disposal of capital assets and/or trade fixtures. g) Sums received by Lessee for loss of use, loss, conversion, or abandonment of Lessee's vehicles. h) Sums received by Lessee from its customers, including all associated administrative charges, for traffic tickets, parking tickets, towing charges, impound fees, and other similar governmental fines and charges actually paid by Lessee on behalf of such customers. i) Sums received by Lessee for pass -through charges collected by Lessee from its customers with respect to damage, repair, parts replacement, extraordinary cleaning of vehicles, towing and transporting of damaged vehicles and key replacement j) Retroactive adjustment by Lessee of Gross Revenues designated as volume discounts or rebates, corporate discounts or rebates, or any other designation of any nature, or for any purpose. 3. It is understood and agreed that all losses or chargebacks (including bad debt expenses) are to be borne solely by Lessee, and the City is to be paid on Gross Revenues without charge or reduction for costs of losses. 4. Lessee shall not intentionally divert, through direct or indirect means, any of Lessee's rental car or related business with Airport customers to off -airport locations of Lessee or affiliates of Lessee without including the Gross Revenues of such transactions, in Lessee's reported Gross Revenues. Any such intentional diversion of Gross Revenues shall constitute a Default under this Agreement and the City shall have the right to immediately terminate this Agreement upon Rental Car Lease Agreement Page 8 determination by the City or its auditors that an intentional diversion exists or has occurred. 5. Lessee shall not modify its accounting treatment or rename or redefine services or products which under the terms of this Agreement would be subject to the Percentage Fee unless approved in writing by the City. C. RENT 1. Customer Service Counter: For each month during the Term, Lessee shall pay to the City rent for the square footage of exclusive counter space, as shown on Exhibit "A". The rental rate shall be equal to the terminal rental rate paid by the airlines, and as adjusted annually by the City. 2. Ready/Return Vehicle Parking Area: For each month during the Term, Lessee shall pay to the City the sum of TWENTY-FIVE AND NO/100 DOLLARS ($25.00) per space per month for Lessee's allocated parking spaces, as shown on Exhibit `B". The monthly rental rate will increase $1.00 per space at the commencement of each Agreement year. 3. Quick Turnaround/Service Facility ("QTA'a: For each month during the Term, Lessee shall pay to the City its pro-rata share of the ground rent for the land area underlying the QTA, vehicle storage, circulation, and Service Facility areas consisting of approximately 342,500 square feet, as shown on Exhibit "C", at the rate of $0.20 per square foot per year. Lessee's pro-rata share shall be equal to the percentage derived by comparing the Lessee's exclusive QTA premises to the total exclusive use QTA premises of all lessees. The ground rental rate shall be adjusted on January 1, 2019, and each January 1" thereafter, in accordance with the percentage increase for the preceding twelve (12) months in the Consumer Price Index published by the Bureau of Labor Statistics of the United States Government. In no event however, will the ground rental rate for any Agreement year be less than $0.20 per square foot per year. 4. Service Facility: Until the date Lessee takes possession of its QTA premises, the Lessee shall pay to the City rent for the land area used by Lessee for its existing Service Facility, at the rate of $0.20 per square foot per year. On January 1, 2019, and each January 1st thereafter, the rental rate for the area used for the service Rental Car Lease Agreement Page 9 facility shall be adjusted in accordance with the percentage increase for the preceding twelve (12) months in the Consumer Price Index published by the Bureau of Labor Statistics of the United States Government. D. CUSTOMER FACILITY CHARGE 1. Lessee will collect and remit to City, a Customer Facility Charge (referred to herein as "CFC") in the amount of $4.50 per Transaction Day for the rental of a vehicle by Lessee at the Airport. A "Transaction Day" shall mean a 24-hour period or fraction thereof for which a rental car customer is provided the use of a rental car regardless of the duration or length of the rental term. A partial rental day that is within a grace period of no more than two (2) hours after the last 24-hour day shall not be considered a Transaction Day. Lessee will be required to pay CFCs to the City (regardless of whether such amounts are charged to or collected from Airport customers) in accordance with the terms and provisions of this Agreement. Lessee's election to not charge or collect CFCs will not relieve Lessee from its responsibility to pay the full amount of such CFCs due and payable to the City hereunder. The City hereby delegates to the Director authority to reasonably determine and adjust accordingly the CFC payable hereunder, if the total amount of CFC revenues estimated by the Director to be remitted to the City will be insufficient to meet the debt service payment requirement on the debt obligations incurred by the City in connection with rental car facility capital projects. 2. CFC revenues paid to the City shall be placed in a separate account and may be used by the City to pay the City's costs for financing, planning, designing, managing, constructing, and improving rental car facilities and related infrastructure at the Airport, including but not limited to roadways, parking facilities, terminal facilities, utilities allocable to rental car usage, the development of future service and maintenance facilities, and to fund the City's costs for such other rental car related purposes as the City determines are necessary and appropriate. 3. City will apply CFCs revenues as follows: • to the payment of debt service on debt obligations incurred by City in connection with the rental car capital projects; Rental Car Lease Agreement Page 10 • to repay City for the annual amortization of any amounts of City funds expended on or invested in capital rental car facilities; • to fund a reserve against any future shortfalls in CFC revenues; • to make up any deficiencies in the amount of CFCs collected in prior years or to defray all or part of a future fiscal year's annual CFC requirement; • to defease or prepay the amounts of any indebtedness City has incurred in connection with rental car capital projects; • to fund a Capital Repair and Replacement Fund; and • Seventh: to be held in reserve to pay the cost of future improvements to rental car facilities. 4. Lessee shall separately state the amount of the CFC in its vehicle rental agreements and collect the CFC from its customers on behalf of City, Lessee agrees CFCs are not income, revenue, or any other asset of Lessee; that Lessee has no ownership or property interest in such CFCs; and Lessee hereby waives any claim to a possessory or ownership interest in the CFCs. Lessee agrees it holds such CFCs in trust for the benefit of the City, and the City (or a trustee on its behalf) has complete possessory and ownership rights to such CFCs. 5. Lessee will include in its Monthly Gross Receipts Report, in substantially the form set forth in Exhibit "D" hereto, the: (i) total number of Vehicle Rental Contracts entered into by Lessee with Airport Customers, (ii) total number of Transaction Days thereunder, and (iii) total amount of CFCs payable by Lessee in connection with such Vehicle Rental Contracts. Lessee will remit to the City the total amount of CFCs due and payable for the previous month. Any such CFCs which are not paid by the 20th day of the month shall be subject to a late payment charge of five percent (5%) of the total amount due. In the event Lessee fails to timely furnish to the City any Monthly Gross Receipts Report required under this Agreement, the City will have the right (but not the obligation), with seven (7) days' written notice, to conduct an audit of Lessee's books and records, which books and records will be prepared and maintained in accordance with, and will include all of the information required under the terms of this Agreement, and to prepare such Monthly Gross Receipts report at Lessee's expense. Moreover, in Rental Car Lease Agreement Page I I the event that Lessee fails to timely furnish any such Monthly Gross Receipts Report or fails to make available its books and records, the City will have the right to estimate the CFCs due and payable hereunder. In such case, the City will furnish to Lessee, on a monthly basis, a report showing, in the aggregate, the total number of Transaction Days and the total amount of CFCs payable in connection with such Transaction Days hereunder, which shall be binding on Lessee. 6. The audit rights set forth in this Agreement will apply and will be available to the City with respect to the CFCs and collections thereof hereunder; provided, (i) if any such audit with respect to CFCs will disclose that Lessee's Monthly Gross Receipts Report understated CFC collections to the extent of five percent (5%) or more, Lessee will promptly pay to the City the cost of said audit in addition to a late payment charge of five percent (5%) of the total amount due. If any such audit with respect to CFCs and collections thereof discloses that Lessee's Monthly Gross Receipts report understated CFC collections by less than five percent (5%), Lessee will promptly pay to the City one-half (1/2) the cost of said audit in addition to the deficiency, together with late payment charge of five percent (5%) from the date due until paid, which deficiency will be payable in any event. If the City requires or performs more than one (1) audit during any Agreement year during the Term hereof, the cost of any such additional audit will be paid by the City (except to the extent the initial or prior audit for such Agreement year revealed a deficiency of five percent (5%) or more, in which case the aforementioned provisions will apply). 7. Lessee covenants and agrees that Lessee will not be entitled to any rights to offset or other reduction in the requirements herein and will be required to remit to the City all CFCs imposed upon Lessee regardless of any amounts that may be owed or due to Lessee by the City. Rental Car Lease Agreement Page 12 E. LESSEE'S ABATEMENT RIGHTSI. In the event one or more of the following conditions occur during the Term hereof, Lessee's MAG shall be abated for the period of time the condition or conditions continue to exist: a) If, for any reason, the number of passengers deplaning on scheduled airline flights at the Airport during any monthly period shall be less than 85% of the number of such deplaning passengers for the same month of the immediately preceding year. b) If the operation of Lessee's car rental business at the Airport, through no fault of Lessee, is adversely affected by shortages or other disruptions in the supply of automobiles, gasoline, or other goods necessary for the operation thereof, and there is a material diminution of gross revenues by 20% in Lessee's gross revenues hereunder for a period of thirty (30) or more consecutive days attributable to such shortages or other disruptions. 2. During the period of the abatement, Lessee will continue to pay to the City the Percentage Fee and the City will return to Lessee any minimum annual guaranteed payment which may have been prepaid. In the event any of the above conditions continue for a period in excess of six (6) consecutive months, Lessee shall have the right to terminate this Agreement. F. MOST FAVORED NATIONS CLAUSE In the event any contract granted by the City to any other automobile rental company for a concession at the Airport shall contain terms and conditions more favorable than the terms and conditions herein described (other than the location of the counter area, the number of allocated ready/return parking spaces, and the QTA), then at the option of Lessee, this Agreement shall be amended to include such more favorable terms and any offsetting burdens that may be imposed on any such other rental car company. The intent of this provision is to ensure Lessee will be able to compete on terms as equal as possible with all other automobile rental companies at the Airport and to ensure no other lessee shall enjoy any rights or privileges more favorable to such lessee than those enjoyed by the Lessee herein. Rental Car Lease Agreement Page 13 G. EXCLUSIVITY City agrees during the Term of this Agreement that it will not enter into any more than six (6) automobile rental Lease Agreements for the purpose of conducting a rental car business in the terminal building of the Airport. If fewer than six (6) automobile rental Lease Agreements are awarded, no additional rental car will be added during the term of the Agreement. In the case of a vacancy by a lessee, the City reserves the right to fill the vacancy through another Request for Proposal process under the similar terms and conditions. H. RECORDS The Lessee, following accepted accounting practices and procedures, will maintain true and accurate books, records, and receipts which will show all revenues of all business transacted upon and within the Airport by Lessee. Within sixty (60) days of the end of each Agreement year, Lessee shall submit to the City a verified statement of Gross Revenue during the most recent Agreement year in which Lessee conducted business operations at the Airport. Such statement shall be certified by Lessee's chief financial officer or other authorized representative of Lessee and shall be accompanied by Lessee's payment of any remaining sums due the City for such business operations. In the event Lessee's prior payments to the City exceed the amount required by this Agreement, the City shall reimburse Lessee with an amount equal to the difference between the sum required and the sum paid. I. AUDIT All books, records, and receipts of all business transacted upon and within the Airport will be kept or maintained at the Airport or other place consented to in writing by the Director, and will be available for inspection and examination during regular office hours by the Director or authorized representatives of the City. Such written consent may be revoked by the Director at any time. Any other books, records, and receipts of Lessee's business operations located within a two (2) mile radius of the Airport which the Director or authorized representatives of the City desire to inspect or examine shall also be made available for such purpose after reasonable notice to Lessee. For the purposes of determining the accuracy of the required statements of gross revenue, the Director may authorize the making of a spot test audit and base the findings for an entire period upon Rental Car Lease Agreement Page 14 such audit, provided that the audit shall include at least twenty-five percent (25%) of the total time of the period audited. Lessee herein agrees to pay all reasonable expenses incurred by the Director and all other authorized representatives of the City when such person or persons inspect, examine, or audit books, records, or receipts of business transacted at the Airport at any location other than the Airport. In addition, the Director shall have the right at any time during the Term of this Agreement to authorize an audit of Lessee's records pertaining to its business operations at the Airport. Any such audit shall be undertaken by the City's Internal Audit Department or a reputable firm of independent Certified Public Accountants satisfactory to the City. The cost of such audit shall be borne by the City, unless results of the audit reveal a discrepancy of more than five percent (5%) between gross revenue reported in accordance with Section A of this Article and gross revenue as determined by the audit. In case of a discrepancy of more than five percent (5%) in favor of the Lessee, the full cost of the audit shall be borne by the Lessee. J. DIVERTING REVENUE Any action taken by the Lessee to divert rental car business from the Airport to off - Airport locations or to induce its patrons or patrons of other car rental lessees at the Airport to rent or receive vehicles in any manner or at any location so as to diminish rentals payable to the City by Lessee or other car rental lessees at the Airport shall constitute a material breach hereof and a cause for the immediate termination of this Agreement by the City. ARTICLE FIVE OBLIGATIONS OF THE CITY A. CLEAR TITLE The City covenants and agrees that upon execution of this Agreement, City is well seized of the Leased Premises and has good title, free, and clear of all liens and encumbrances having priority over this Agreement; and the City has full right and authority to lease the premises described in this Agreement. Rental Car Lease Agreement Page 15 B. MAINTENANCE OF AIRPORT The City covenants and agrees it will during the Term of this Agreement operate and maintain the Airport as a public facility consistent with and pursuant to the Assurances given by the City to the United States Government under federal law. C. CONDITIONS AND MAINTENANCE OF LEASED PREMISES Except as provided in Exhibit E, the City shall assume no responsibility for the condition of the Leased Premises and shall not assume responsibility for maintenance, upkeep, or repairs necessary to keep the Leased Premises in a safe and serviceable condition. D. The City agrees to provide employee parking for Lessee's employees at the same rate and same location as provided other Airport tenant employees. E. The City agrees to provide a postal box for Lessee at the same rate and same location as provided other Airport tenants. ARTICLE SIX LESSEE PRIVILEGES AND CONDITIONS; MAINTENANCE The City grants to the Lessee the following general privileges, uses, and rights, all of which are subject to the terms, conditions, and covenants herein set forth and all of which shall be non-exclusive on the Airport: A. The general use of all common terminal facilities and improvements which are now or may hereafter be connected with or appurtenant to the terminal building only in such a manner as may be necessary or convenient to the conduct of Lessee's business. B. The right of ingress to and egress from the Leased Premises over and across common or public roadways serving the Airport for Lessee, its agents, employees, patrons, invitees, suppliers of services, and providers of materials. Such right of ingress and egress being subject to such ordinances, rules, and regulations now existing or subsequently promulgated. C. The privilege of constructing improvements upon Lessee's Leased Premises, subject to the prior written approval by the Director and in accordance with the City's ordinances, codes, permits, etc. D. The right to sell used rental vehicles with the following restrictions: Rental Car Lease Agreement Page 16 1. Only those vehicles used by the Lessee at the Airport may be sold at the Airport. All signs used in connection with the sale of such vehicles shall be approved in writing and in advance by the Director. 2. The sale of such vehicles on Airport premises shall be restricted to Lessee's QTA premises, as shown in Exhibit "C" or the temporary Service Facility location, whichever one is being utilized. E. STANDARD OF SERVICE The Lessee shall conduct a first class automobile rental service on the Leased Premises sufficient to meet reasonable demands for such service at the Airport. The Lessee agrees to conduct its business in a proper and courteous manner and to furnish prompt and efficient service, making available to the public clean, late -model, low -mileage automobiles in good mechanical condition. As used herein, the term "late -model" shall mean no more than two (2) model years old (including the current model year). Lessee agrees to charge fair, reasonable, and non-discriminatory rates and charges for the rental of vehicles. However, Lessee may make reasonable and non-discriminatory discounts, rebates, or other similar types of price reductions to volume customers. F. BUSINESS SOLICITATIONS All of Lessee's business operations and solicitations will be confined to its Leased Premises. Lessee agrees to have employees present at its counter during all hours of scheduled airline arrivals. G. ADVERTISING Lessee will erect no signs and will distribute no advertising in the Airport or on Airport property without the prior written consent of the Director. However, such prior written consent shall not be required for advertising placed by Lessee with any other party authorized by the City to sell, rent, or offer Airport terminal advertising space. H. MAINTENANCE Lessee accepts the Leased Premises in their present condition. It shall be the sole responsibility of the Lessee to keep, maintain, repair, and operate the entirety of the Leased Premises, and shall, at its sole cost and expense, maintain the grounds, fences, buildings, improvements, and appurtenances at all times in a clean and presentable condition, free of trash, debris, and weeds and consistent with good business practices, Rental Car Lease Agreement Page 17 and equal in appearance and character to similar improvements in the terminal building, Ready/Return Vehicle Parking area, and QTA. The Lessee shall repair all damage to the Leased Premises and City -owned property caused by its employees, patrons, and its operations at the Airport. The City shall be the sole judge of the quality of maintenance and upon written notice from the Director the Lessee shall be required to perform such maintenance as deemed necessary. Failure by Lessee to comply within ten (10) days following receipt of such written notice from the Director shall give the City the right to enter upon the Leased Premises and perform the necessary maintenance, the cost of which shall be borne by the Lessee. Other detailed responsibilities are shown on Exhibit "E", which is attached to this Agreement. Major maintenance items shall be funded as set forth in Article Four, Section D. 1. Not later than six (6) months prior to the date upon which the City notifies Lessee that its QTA premises will be available for use and occupancy, Lessee, and all other lessees ("On -Airport Rental Car Companies") that are parties to a valid Lease Agreement with the City will enter into or join in an operating agreement (the "Operating Agreement") establishing a consortium of the On -Airport Rental Car Companies (the "RAC Consortium") which provides, among other things, for (i) the maintenance, repair, cleaning (trash pick up), ice and snow removal, and striping of the Ready/Return Vehicle Parking area; (ii) the cleaning (trash pick up), operation, maintenance, and repair of the QTA and the common use fueling system pursuant to, and in accordance with, the terms and provisions of this Agreement and the other On -Airport Rental Car Company Lease Agreements then (or to be) in effect; and, (iii) the hiring of a property manager, reasonably acceptable to the City. The Operating Agreement shall require the On -Airport Rental Car Companies to give notice to the City of any default by Lessee thereunder and provide the City with the option to elect to cure any such default within a period commensurate with any cure period given to Lessee under the Operating Agreement. The RAC Consortium shall promptly notify the City of any non-payment or other default by any On -Airport Concessionaire under the Operating Agreement or of any notice of default received by the RAC Consortium under the Operating Agreement. Rental Car Lease Agreement Page 18 Failure to enter into an Operating Agreement shall be considered a material breach of this Agreement and may subject the Lessee to a cancellation of the Agreement without further obligation on the part of the City. ARTICLE SEVEN IMPROVEMENTS A. FACILITY IMPROVEMENTS The City anticipates construction of a new consolidated rental car QTA, as generally depicted in Exhibit "C" and reconfigure the Ready/Return parking area and improvements, as depicted in Exhibit `B" (collectively the "Facility Improvements"). The City shall not be required to perform any work or construct any improvements, furnish any services or facilities, perform any maintenance, or make any repairs or alterations or environmental remediation or clean-up in or to the Leased Premises throughout the Term hereof. B. PROPERTY PERMANENTLY AFFIXED TO PREMISES Any property belonging to Lessee which becomes permanently attached to the Leased Premises shall become the property of the City upon termination of this Agreement, whether upon expiration of the initial Term, any extension thereof, or earlier under any provision of this Agreement. C. REMOVAL OF LESSEE'S PROPERTY Except as provided herein, Lessee shall have the right, within twenty (20) days after the termination of this Agreement, whether such termination comes upon expiration of the initial Term, any extension, or otherwise under any provision of this Agreement, to remove from the Leased Premises all of Lessee's furniture, fixtures, equipment, and furnishings which have not become the property of the City. Lessee shall restore the Leased Premises to the original condition, normal wear and tear excepted. The City, however, shall have a lien on all of Lessee's property (excluding vehicles) to secure any unpaid rentals or other revenue due the City. Lessee's right to remove property from the Leased Premises is conditioned upon all amounts due the City from Lessee having been paid in full. Property left on the Leased Premises after twenty (20) days from the date of termination of this Agreement shall be deemed abandoned and will become the property of the City. The property may be disposed of as the City sees fit, without any liability to Rental Car Lease Agreement Page 19 the Lessee to account for the proceeds of any sale. The City, at its option, may charge rent from the date of expiration or termination of this Agreement through the day of final removal of the property, or of notification to the Lessee of the abandonment of the property and taking by the City, as the case may be. ARTICLE EIGHT OTHER PROVISIONS A. UTILITIES Lessee shall assume and pay for all costs or charges for utility services provided to Lessee. B. PAYMENT OF TAXES AND FEES Lessee shall pay all federal, state, and local government taxes, license fees, and occupation taxes levied on either the Leased Premises, the business conducted on the Leased Premises, or on any of Lessee's property used in connection therewith. The Lessee shall render for taxation purposes all automobiles and other property used in connection with Lessee's business operations at the Airport. Taxation may be subject to legal protest in accordance with the provisions of the taxing authority whose levy is questioned. Any protest is at the sole expense of Lessee. Delinquency in payment of such obligations after any protest has been settled shall, at the option of the City, be cause for immediate termination of this Agreement. C. REGULATIONS The Lessee's officers, agents, employees, and servants will obey all rules and regulations which may be promulgated by the City, its authorized agents at the Airport, or by other lawful authority. D. PROHIBITION OF SUBLEASES AND ASSIGNMENTS The Lessee will not directly or indirectly assign, sublet, sell, hypothecate, or otherwise transfer this Agreement or any portion of the Leased Premises without the prior written consent of Director. Rental Car Lease Agreement Page 20 E. INDEMNIFICATION AND INSURANCE 1. Indemnification. Lessee shall be deemed to be an independent contractor and operator responsible to all parties for its respective acts and omissions, and the City shall in no way be responsible therefore, except those caused by the sole negligence of the City's respective officers, employees, elected officials and agents as allowed by law. Lessee shall indemnify and hold harmless, to the fullest extent permitted by law, the City, and the City's respective officers, employees, elected officials, and agents from and against any and all losses, damages, claims, or liabilities of any kind or nature which arise directly or indirectly, or are related to, in any way, manner, or form the activities of Lessee contemplated hereunder. Lessee further covenants and agrees to defend any suits or administrative proceedings brought against the City and/or the City's respective officers, employees, elected officials, and/or agents on account of any claim for which it is obligated to indemnify the City, and to pay or discharge the full amount or obligation of any such claim incurred by, accruing to, or imposed on the City, or the City's respective officers, employees, elected officials, and/or agents, as applicable, resulting from the settlement or resolution of said suits, claims, and/or administrative proceedings. In addition, Lessee shall pay to the City, the City's respective officers, employees, elected officials, and/or agents as applicable, all attorney fees incurred by such parties in enforcing Lessee's indemnity in this section. 2. Indemnification — Environmental Harm. Without limiting any provisions of this Agreement, Lessee shall also defend, indemnify, and hold the City, the City's respective officers, employees, elected officials, and agents harmless from and against all suits, actions, claims, demands penalties, fines liabilities, settlements, damages, costs, and expenses (including but not limited to reasonable attorney's and consultant's fees, court costs, and litigation expenses) of whatever kind or nature, known or unknown, contingent or otherwise, brought against the City arising out of or in any way related to: Rental Car Lease Agreement Page 21 a. Any actual, threatened, or alleged contamination by hazardous substances of the premises or contamination by hazardous substances of the Airport by Lessee or its agents; b. The presence, disposal, release, or threatened release of hazardous substances by Lessee or its agents at the Airport that is on, from, or affects the soil, air, water, vegetation, buildings, personal property, persons, animals, or otherwise; c. Any personal injury (including wrongful death) or property damage (real or personal) arising out of or related to hazardous substances by Lessee at the Airport; or d. Any violation by Lessee of any Environmental Laws that affects the Airport. 3. Insurance. The Lessee shall maintain insurance at all times that this Agreement is in effect, at Lessee's sole expense and with an underwriter authorized to do business in the State of Texas and acceptable to the City, against claims of general liability, automobile liability, and worker's compensation resulting from Lessee's business activities at the Airport. a. General Liability Insurance — Lessee will carry and maintain General Liability Insurance for the protection of the City, and insuring against all claims, losses, costs, and expenses arising out of injuries to persons whether or not employed by the Lessee, damage to property whether resulting from acts or omissions, negligence, or otherwise of the Lessee or any of its agents, employees, patrons, or other persons and growing out of the use of the Leased Premises by Lessee, such policies to provide not less than ONE MILLION AND NO/100 DOLLARS ($1,000,000.00) for Combined Single Limit General Liability Insurance. To the extent permitted by law, the policy shall include a waiver of subrogation and the City shall be named an additional insured as their interest may appear arising out of the conduct of the Lessee on a primary and non-contributory basis. b. Automobile Liability — Lessee will carry and maintain Automobile Liability Insurance in the amount not less than ONE MILLION AND Rental Car Lease Agreement Page 22 NO/100 DOLLARS ($1,000,000.00) for Combined Single Limit Automobile Liability Insurance. To the extent permitted by law, the policy shall include a waiver of subro ag tion and the City shall be named an additional insured on a primary and non-contributory basis. c. Workers' Compensation and Employer Liability — Lessee shall obtain workers' compensation coverage to the extent legally required by Section 406.002 of the Texas Labor Code. If legally required, Lessee shall maintain said coverage throughout the Term of this Agreement (or, if shorter, during the period such coverage is legally required) and while such coverage is legally required to be in effect shall comply with all provisions of Title 5 of the Texas Labor Code to ensure the Lessee maintains said coverage. Lessee shall carry and maintain Employer Liability coverage in an amount no less than FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($500,000.00). Any termination of legally required workers' compensation insurance coverage by Lessee or any cancellation or nonrenewal of legally - required workers' compensation insurance coverage for the Lessee shall be a material breach of this Agreement. To the extent permitted by law, the policy shall include a waiver of subrogation. d. Hazard and Extended Coverage — Lessee shall procure from a company authorized to do business in the State of Texas and keep in force Hazard and Extended coverage insurance on the Leased Premises to 80% of the full insurable value and shall furnish the City with evidence that such coverage has been procured and is being maintained. The City shall be named an additional insured as their interest may appear arising out of the conduct of the Lessee on a primary and non-contributory basis. e. Current Certificates of Insurance and Endorsements shall be provided to the City, or other satisfactory evidence of insurance shall be filed with the Director by the Lessee. The Lessee or its insurer shall notify the Director of any alteration, renewal, or cancellation of this coverage which shall remain in full force and effect until at least ten (10) days after such notice of alteration, renewal, or cancellation is received by the Director. Rental Car Lease Agreement Page 23 F. WAGES The Lessee shall pay, or require the payment of, the prevailing wage rate for each craftsman or workman employed by Lessee, or by persons or firms engaged by Lessee for any alteration of the Leased Premises or installation, maintenance, or repair of vehicles, fixtures, equipment, and furnishings used in Lessee's operations, as required by Texas Government Code Chapter 2258, as amended. The ordinances and statute and amendments thereto are incorporated herein by the reference for all purposes. G. CONDUCT AND APPEARANCE OF EMPLOYEES Employees of Lessee who are reasonably deemed to be discourteous or objectionable shall be removed from the Leased Premises by Lessee on demand from the Director, who may also cause any objectionable person or persons, including Lessee's employees, to be removed from said premises; and Lessee hereby waives any right and all claims for damages against City or any of its officers, agents, elected officials, or employees which might occur as a result of the exercise of such authority. H. LIENS PROHIBITED Lessee shall not bind or attempt to bind the City for payment of any money in connection with the construction, repairing, alterations, additions, or reconstruction work on the Leased Premises. Lessee shall not permit any mechanic's, materialman's, or contractor's liens to arise against the premises, improvements thereon, or any equipment, machinery, and fixtures thereon belonging to the City. Lessee expressly agrees it will keep and save the premises and the City harmless from all costs and damages resulting from any liens of any character created or that may be asserted through any act or thing done by the Lessee. In the event any mechanic's lien or other lien or order for payment shall be filed against the Leased Premises or improvements thereon, or against City -owned property located thereon during the initial Term hereof, or during any subsequent extension, Lessee shall within ten (10) days cause the same to be cancelled and discharged of record by bond or otherwise, at the election and expense of Lessee. Lessee shall also defend on behalf of the City, at Lessee's sole cost and expense, any action, suit, or proceeding which may be brought thereon or for the enforcement of such lien or order. Failure of the Lessee to comply with any requirement of this section shall be cause for immediate termination of this Agreement by the City. Rental Car Lease Agreement Page 24 I. AIRPORT CONCESSION DISADVANTAGED BUSINESS ENTERPRISE 1. In order to qualify Lessee as an Airport Concession Disadvantage Business Enterprise (ACDBE) under this Agreement, Lessee shall be certified by the State of Texas under the Unified Certification Program. 2. The City is committed to a policy and program for the participation of ACDBEs in concession -related contracting opportunities in accordance with U.S. Department of Transportation's (DOT) 49 Code of Federal Regulations (CFR) Part 23 as may be amended. In advancing City's policy, Lessee agrees to ensure that ACDBEs, as defined in 49 CFR Part 23 and City's ACDBE Program, have the maximum opportunity to participate in the performance of this Agreement. Lessee will take all necessary and reasonable steps in accordance therewith to ensure that ACDBEs are encouraged to compete for and perform subcontracts under this Agreement. 3. Non -Discrimination (a) This Agreement is subject to the requirements of the U.S. Department of Transportation's Regulations 49 CFR Part 23. Lessee agrees it will not discriminate against any business owner because of owner's race, color, natural origin, or sex in connection with the award or performance of any concession agreement, management contract, or subcontract, purchase of lease agreement, or other agreement covered by 49 CFR Part 23. Failure by Lessee 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. (b) Lessee will agree to include the statements in paragraphs (1) and (2) above 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. 4. ACDBE Participation and Compliance (a) ACDBE Goal: Lessee agrees it will pursue subcontracting opportunities with ACDBE firms, certified with the State of Texas Uniform Certification Program, to provide goods and services to be purchased under this Agreement for each year Rental Car Lease Agreement Page 25 of the Term, or clearly demonstrate in a manner acceptable to City its good faith efforts to do so. (b) ACDBE Termination and Substitution: Lessee will not terminate an ACDBE for convenience without the City's prior written consent. If an ACDBE is terminated by the Lessee with the City's consent or because of the ACDBE's default, then the Lessee must make a good faith effort, in accordance with the requirements of 49 CFR Part 23.25 to find another ACDBE to substitute for the original ACDBE to provide the same amount of ACDBE participation. (c) Reporting Requirements: Lessee agrees that within twenty (20) days after September 30 of each year during the Term of this Agreement, it will provide an ACDBE Utilization Activity Report to the City, in a form acceptable to the City, the total actual payments received by each of its ACDBE subcontractors and vendors for such fiscal year, calculated in accordance with the requirements of 49 CFR Part 23. If the ACDBE participation required is not met, Lessee will explain in its report the reason for its failure to meet the prescribed goal and the corrective action(s) the Lessee proposes to take in the next fiscal year(s) to meet said goal. (d) Monitoring: City will monitor the compliance and good faith efforts of the Lessee in meeting the requirements of this Section. City will have access to the necessary records to examine such information as may be appropriate for the purpose of investigating and determining compliance with this Section, including, but not limited to, records, records of expenditures, contracts between the Lessee and the ACDBE participant, and other records pertaining to the ACDBE participation plan with the Lessee. (e) Prompt Payment: Lessee agrees to pay each subcontractor under the Agreement for satisfactory performance of its contract no later than ten (10) calendar days. Lessee agrees further to release retainage payments to each subcontractor within ten (10) calendar days after the subcontractor's work is satisfactorily completed. Any delay or postponement of payment from the above referenced time frame may occur only for good cause. This clause applies to both ACDBE and non- ACDBE subcontractors. Rental Car Lease Agreement Page 26 (f) Sanctions for Non -Compliance: City may, in addition to pursuing any other available legal remedy for Lessee's failure to comply with this Section, terminate, suspend, or cancel this Agreement in whole or in part; and/or suspend the Lessee from future Agreements with the City. J. NON-DISCRIMINATION PRACTICES Lessee, its agents, and employees will not discriminate against any person or class of persons by reason of age, sex, race, religion, or national origin in providing any services or in the use of any of its facilities provided for the public. Lessee further agrees to comply with such enforcement procedures as the United States Government might demand that the City take in order to comply with the Sponsor's Assurances. Lessee agrees not to discriminate against any employee or applicant for employment because of age, sex, race, religion, or national origin. Lessee agrees to take affirmative action to ensure applicants are employed and employees are treated during employment without regard to their age, sex, race, religion, or national origin. Such action shall include, but not be limited to employment, upgrading, demotion, transfer, recruitment, layoff, rates of pay or other forms of compensation, and selection for training, including apprenticeship. Lessee shall also comply with the Americans with Disabilities Act, if applicable, at all times this Agreement is in effect. K. SINGULAR AGREEMENT Lessee acknowledges and agrees it will only operate under one brand name during the Term of this Agreement. Under no circumstances shall any "dual branding" or combined operations of Lessee be represented to the public in signage or other manner which would represent to the public that two or more companies were jointly operating one concession operation at the Airport. L. OUTSTANDING CHARGES Lessee herein agrees to pay all outstanding rentals, fees, and other charges incurred under any prior Agreement with the City within twenty (20) days of the date of execution of this Agreement. Rental Car Lease Agreement Page 27 M. COMPLIANCE WITH CHAPTER 2270, SUBTITLE F, TITLE 10, TEXAS GOVERNMENT CODE The Lessee warrants that it is in compliance with Chapter 2270, Subtitle F, Title 10 of the Texas Government Code by verifying that: (1) it does not boycott Israel; and (2) it will not boycott Israel during the term of the Agreement. ARTICLE NINE TERMINATION AND CANCELLATION A. TERMINATION This Agreement shall terminate at the end of the full Term or extension hereof and Lessee shall have no further right or interest in any of the premises or improvements hereby demised. B. CANCELLATION BY LESSEE This Agreement may be cancelled by Lessee after the happening of one or more of the following events: 1. The permanent abandonment of the Airport by the City as an air terminal. 2. The lawful assumption by the United States Government, or any authorized agency thereof, of the operation, control or use of the Airport, or any substantial part or parts thereof, in such a manner that substantially restricts Lessee for a period of at least ninety (90) days from operating thereon. 3. The issuance by any court of competent jurisdiction of an injunction in any way preventing or restraining the use and operation of the Airport for a period of at least ninety (90) days. 4. The default of the City in the performance of any covenant or agreement herein required to be performed by the City and the failure of the City to remedy such default for a period of thirty (30) days after receipt from Lessee of written notice to remedy the same. Lessee may exercise such right of termination by giving thirty (30) days advance written notice to the City at any time after the lapse of the applicable periods of time and this Agreement shall terminate as of the thirtieth (30t') day. Concessions and rentals due Rental Car Lease Agreement Page 28 hereunder as set forth in Article Four shall be payable only to the effective date of said termination. C. CANCELLATION BY CITY This Agreement may be cancelled by City after the happening of one or more of the following events: 1. The taking by a court of competent jurisdiction of Lessee and its assets pursuant to proceedings brought under the provisions of any federal reorganization act. 2. The appointment of a receiver for Lessee's assets. 3. The divestiture of Lessee's assets by other operation of law. 4. The abandonment by Lessee of its rental car service at the Airport for a period of ten (10) days or more. 5. The failure by Lessee to pay any rentals or other charges due after given ten (10) days written notice to cure. 6. The default by Lessee in the performance of any covenant or agreement herein required to be performed by Lessee and the failure of Lessee to remedy such default for a period of thirty (30) days after receipt of written notice to remedy the same from the Director. 7. The Lessee's breach of any provision contained in Article Four, Section A, 2 of this Agreement. 8. The lawful assumption by the United States Government, or any authorized agency thereof, of the operation, control, or use of the Airport, or any substantial part or parts thereof, in such a manner as to substantially restrict Lessee for a period of at least ninety (90) days from operating thereon. If any of the aforesaid events occur, City may enter upon the Leased Premises and take immediate possession of the same and remove Lessee's effects. Upon said entry, this Agreement shall terminate and any amounts due hereunder as set forth in Article Four shall be payable to said date of termination. It is agreed that failure to declare this Agreement terminated upon the default of Lessee for any of the reasons set forth above shall not be construed as a waiver of any of the City's rights hereunder or otherwise bar or preclude City from declaring this Agreement Rental Car Lease Agreement Page 29 cancelled as a result of any subsequent violation of any of the terms or conditions of this Agreement. ARTICLE TEN GENERAL A. TIME OF EMERGENCY During time of war or national emergency, the City shall have the right to lease the landing area and any other portion of the Airport to the United States for governmental use and, if any such agreement is executed, the provisions of this Agreement, insofar as they are inconsistent with the provisions of the agreement to the United States, shall be suspended. B. SPONSOR'S ASSURANCE SUBORDINATION This Agreement shall be subordinate to the provisions of any existing or future agreement between the City and the United States concerning the operation or maintenance of the Airport, the execution of which has been or may be required as a condition precedent to the expenditure of federal funds for the development of the Airport. Should the effect of such agreement with the United States be to take any of the property under this Agreement or otherwise diminish the commercial value of this Agreement, the City shall not be held liable therefor. C. REPLACEMENT AFTER DAMAGE It is agreed between the parties hereto that in the event the Leased Premises are damaged by fire or other accidental cause during the initial Term of this Agreement so as to become totally or partially untenantable, the City shall have the option to restore the premises to their former condition. If the City elects to exercise the option, the City shall give Lessee notice in writing of its election within thirty (30) days of the occurrence of such damage. If the City elects to restore the premises, the City shall proceed with due diligence and there shall be an abatement of the associated rent or concessions until repairs have been made for the time and to the extent for which the premises, or part thereof, have been untenantable. Should the City not exercise the option to restore the premises, this Agreement shall cease and terminate effective on the date of damage by fire or other accidental cause. Rental Car Lease Agreement Page 30 D. CONFLICT OF INTEREST Lessee acknowledges it is informed that Texas law prohibits contracts between the City and its "officers" and "employees," and that the prohibition extends to officers and employees of City agencies, such as City -owned utilities, and certain City boards and commissions, and to contract with any partnership, corporation, or other organization in which the officers or employees have a substantial interest. Lessee certifies (and this Agreement is made in reliance thereon) that neither the Lessee nor any person having an interest in this Agreement is an officer or employee of the City or any of its agencies, boards, or commissions. E. BOND Lessee must provide the City with a performance bond in the amount equal to one fourth of Lessee's first Agreement year MAG under this Agreement to secure the prompt payment of Lessee's obligations under this Agreement. Such bond shall be effective through the Term of this Agreement. In lieu of a performance bond, Lessee may provide to the City an irrevocable letter of credit from a bank or other financial institution approved by the City Attorney of the City and which assures the City of payment equal to one fourth of Lessee's first Agreement year MAG. F. RIGHT OF INSPECTION The City reserves the right to conduct inspections of the Leased Premises at reasonable times to ensure that fire, safety, sanitation regulations, and other provisions contained in this Agreement are being adhered to by the Lessee. G. TERMINATION OF AGREEMENT, SURRENDER OF LEASED PREMISES, AND OWNERSHIP OF IMPROVEMENTS Lessee covenants and agrees at the expiration of the initial Term of this Agreement, or any extension which has been granted, or upon earlier termination as provided elsewhere in this Agreement, Lessee will quit and surrender the Leased Premises and the improvements in good state and condition, reasonable wear and tear accepted, subject to Article Seven, Section C of this Agreement, and the City shall have the right to take possession of the Leased Premises and the improvements, subject to the limitations expressed in Article Seven of this Agreement, with or without process of law. Rental Car Lease Agreement Page 31 H. HEADINGS The paragraph headings contained herein are for convenience in reference and are not intended to define, extend, or limit the scope of any provisions in this Agreement. I. NOTICES Notices to the City required or appropriate under this Agreement shall be deemed sufficient if in writing, mailed registered or certified, and postage prepaid addressed to: Executive Director of Aviation Lubbock Preston Smith International Airport 5401 N. MLK Blvd., Unit 389 Lubbock, Texas 79403 Notices to the Lessee shall be deemed sufficient if in writing, mailed registered or certified, and postage prepaid to the representative and address provided by Lessee and on -file at the Airport. J. NON -ARBITRATION The City reserves the right to exercise any right or remedy available to it by law, contract, equity, or otherwise, including without limitation, the right to seek any and all forms of relief in a court of competent jurisdiction. Further, the City shall not be subject to any arbitration process prior to exercising its unrestricted right to seek judicial remedy. The remedies set forth herein are cumulative and not exclusive, and may be exercised concurrently. To the extent of any conflict between this provision and another provision in, or related to, this document, this provision shall control. K. ENTIRE AGREEMENT This Agreement constitutes the entire agreement between the City and Lessee, and any other written or parole agreement with the City is expressly waived by Lessee. Rental Car Lease Agreement Page 32 EXECUTED this 22nd day of March , 2018. THE CITY OF LUBBOCK BY: _ DANIEL M. POPE, MAYOR ATTEST: P I da 4 e. 5k� Reb ca Garza, City ecretary 0 APPROVED AS TO CONTENT: a W Kelly ampbell, xecutive Director of Aviation Avis Rent A Car System, LLC BY: 04a,- Robert Bouta, Senior Vice President an authorized representative of Avis Rent a Car System, LLC Title: Date: Rental Car Lease Agreement Page 33 W U W N ac w i U 0 Z 0 WE (0 o, U Od ono d Z K 0 n LL W Z O U 2 U U I- LO N L- U iii f Lf�1TG1 Lubbock Preston rpot International alAirport EXHIBIT C (1 OF 2) LBB CONRAC QUICK TURN -AROUND AREA a Iml No. -------------- QUICK TURN -AROUND EAN 23 STALLS 4 FUEWAC, POSITIONS 1 CAR WASH BAY 2 MAINTENANCE BAYS 10 MAINT. STACKING 2,629 SF ADMIN. EAN 24 STALLS 4 FUEWAC. POSITIONS 1 CAR WASH BAY 2 MAINTENANCE BAYS 10 MAINT. STACKING 2,629 SF ADMIN. AVIS 24 STALLS 4 FUEWAC. POSITIONS 1 CAR WASH BAY 2 MAINTENANCE BAYS 10 MAINT. STACKING 2,629 SF ADMIN. O HERTZ 23 STALLS 4 FUEWAC. POSITIONS 1 CAR WASH BAY 2 MAINTENANCE BAYS 10 MAINT. STACKING 2,629 SF ADMIN. PAGE 3 OF 4 1 1 01/25/18 LubbockPrestontjWrtSmith EXHIBIT C (2 OF 2) LBB CONRAC International Airport QUICK TURN -AROUND AREA STAGING / STORAGE EAN 166 STALLS 32,880 SF EAN 158 STALLS 32,239 SF AVIS 156 STALLS 31,835 SF HERTZ 163 STALLS 30,521 SF PAGE 4 OF 4 1 1 01 /25/18 LUBBOCK PRESTON SMITH INTERNATIONAL AIRPORT MONTHLY GROSS RECEIPTS REPORT NAME OF COMPANY MONTH / YEAR STATEMENT OF GROSS RECEIPTS Time & Mileage $ Drop Charges $ Child Restraints / Car Seats $ Concession Recoupment $ Insurance & Insurance Waivers $ Fuel $ Toll Transponders Service Fees $ Cellular Phones & GPS $ Additional Driver $ Underage / Overage Driver $ Guaranteed Reservation Fees $ Coupons - Vehicle comps $ Customer Adjustment $ Change of Equipment $ Overstay/Understay Fee $ Texas Reimbursement Fee $ Vehicle License Recoup $ Non -Airport Users $ Government Administrative Rate $ Replacement Equipment Fee $ Maintenance $ Frequent Flyers Program $ Miscellaneous $ Other: $ GROSS RECEIPTS $ 0 @ 10% = $ 0 CUSTOMER FACILITY CHARGE Number of Rental Transactions: Average rental price (total rental): NUMBER OF CONTRACT DAYS @ $4.50 = $ 0 TOTAL DUE WITH THIS REPORT $ 0 (Pay CFC on separate check or payment method) Signature of Authorized Representative Date EXHIBIT E OPERATION & MAINTENANCE RESPONSIBILITIES Air Conditioning Heating Lighting a. Street / Overhead Lighting b. Bulb & Tube Replacement' c. Maintenance 1 Electrical Maintenance Z Maintenance a. Other than Structure b. Structure 3 c. Exterior 4 Custodial Service / Ground Keeping Window Cleaning a. Exterior b.Interior Snow Removal RAC - Rent A Car is responsible LBB - Lubbock Preston Smith International Airport is responsible QTA - Major maintenance and replacement funded by the CFC Capital Repair and Replacement fund. QTA - Routine maintenance and repair is the RAC responsibility. 1 RAC shall be responsible for any light fixtures installed by RAC. z RAC shall be responsible for any electrical fixtures or services installed by RAC. 3 RAC shall be responsible for any structure constructed by RAC (back wall of service counter and ready/return lot podiums). 4 RAC shall be responsible for any exterior maintenance required from actions of RAC, its employees, or subcontractors. REVISED PROPOSAL SUBMITTAL FORM CITY OF LUBBOCK REQUEST FOR PROPOSALS #17-13525-TF On -Airport Rental Car Concession Services LUBBOCK PRESTON SMITH INTERNATIONAL AIRPORT ON -AIRPORT RENTAL CAR CONCESSION MINIMUM ANNUAL GUARANTEE BID Proposer agrees to pay to the City the greater of the minimum annual guarantee (MAG) or 10% of the concessionaire's annual gross revenue as defined in the Lease Agreement (Exhibit D attached to this RFP). The City will not consider any proposal in which the MAG offered for the first Agreement year is less than $50,000. First Agreement Year MAG Bid $ 313,690 Proposer shall operate its concession at the Airport under the following brand/trade name and no others, during the Term of this concession: Avis Rent A Car System, LLC Brand/Trade Name The undersigned hereby offers to furnish the services as specified herein and in their proposal and Agreement (ATTACHED) at the terms stated therein and in strict accordance with the specifications, all of which are made a part of this offer. ACKNOWLEDGE receipt of ADDENDA: #1 X #2 X 93 X #4 X Name of Business (Stamp may be used): Avis Rent A Car System, LLC Address: 6 Sylvan Way City: Parsippany State: NJ Zip 07054 The City of Lubbock Charter states that no officer or employee of the City can benefit from any contract, job, work, or service for the municipality or be interested in the sale to the City of any supplies, equipment, material, or articles purchased. Will any officer or employee of the City, or member of their immediate family, benefit from the award of the contract to the above firm? YES X NO ■ CERTIFICATE OF INTERESTED PARTIES FORM 1295 1of1 Complete Nos. 1- 4 and 6 if there are interested parties. OFFICE USE ONLY Complete Nos.1, 2, 3, 5, and 6 if there are no interested parties. CERTIFICATION OF FILING Certificate Number: 2018-368414 1 Name of business entity filing form, and the city, state and country of the business entity's place of business. Avis Budget ar Rental LLC Parsippany, NJ United States Date Filed: 06/14/2018 Name of governmental entity or state agency that is a party to the contract for which the form is being filed. City of Lubbock Date Acknowledged: 3 Provide the identification number used by the governmental entity or state agency to track or identify the contract, and provide a description of the services, goods, or other property to be provided under the contract. RFP17-13525TF Car Rental Services 4 Name of Interested Party City, State, Country (place of business) Nature of interest (check applicable) Controlling Intermediary 5 Check only if there is NO Interested Party. ❑ 6 UNSWORN DECLARATION ) My name is /� L�J7 (! i3e,4 ku and my date of birth is My address is 6 (street) (city) J (state) (zip code) (country) I declare under penaltyofperjury that the foregoing is true and correct. Executed in _ ' /wr J, I 3 County, State ofA2y) on the day of 20�. (month) (year) Signature of authorized agent of contracting business entity (Declarant) rvnnz, Nivviucu vy i cxas cuncs wmmisslon www.etmcs.state.tx.us Version V1.0.5523 CERTIFICATE OF INTERESTED PARTIES FORM 1295 1 of 1 Complete Nos. 1- 4 and 6 if there are interested parties. OFFICE USE ONLY Complete Nos.1, 2, 3, 5, and 6 if there are no interested parties. 12018-368414 CERTIFICATION OF FILING Certificate Number: 1 Name of business entity filing form, and the city, state and country of the business entity's place of business. Avis Budget ar Rental LLC Parsippany, NJ United States Date Filed: 06/14/2018 2 Name of governmental entity or state agency that is a party to the contract for which the form is being filed. City of Lubbock Date Acknowledged: 06/14/2018 3 Provide the identification number used by the governmental entity or state agency to track or identify the contract, and provide a description of the services, goods, or other property to be provided under the contract. RFP17-13525TF Car Rental Services 4 Name of Interested Party City, State, Country (place of business) Nature of interest (check applicable) Controlling Intermediary 5 Check only if there is NO Interested Party. X 6 LINSWORN DECLARATION My name is and my date of birth is My address is (street) (city) (state) (zip code) (country) I declare under penalty of perjury that the foregoing is true and correct. Executed in County, State of on the day of , 20 (month) (year) Signature of authorized agent of contracting business entity (Declarant) Forms provided by Texas Ethics Commission www.ethics.state.tx.us Version V1.0.5523