[NOTE, SEPARATE TECHNICAL SERVICES AGREEMENTS ARE CONTEMPLATED FOR EACH HOTEL.]

Transcription

1 [NOTE, SEPARATE TECHNICAL SERVICES AGREEMENTS ARE CONTEMPLATED FOR EACH HOTEL.] CHICAGO O HARE INTERNATIONAL AIRPORT TECHNICAL SERVICES AGREEMENT BETWEEN THE CITY OF CHICAGO AND, 20

2 CHICAGO O HARE INTERNATIONAL AIRPORT TECHNICAL SERVICES AGREEMENT TABLE OF CONTENTS Page ARTICLE 1 DEFINITIONS AND EXHIBITS Definitions Exhibits... 2 ARTICLE 2 TECHNICAL SERVICES Engagement of Manager Technical Services Site Visits Inspections Use of Affiliates by Manager Term... 3 ARTICLE 3 FEES AND EXPENSES Technical Services Fee Reimbursable Expenses Accrual after Opening Date Payment of Fees and Expenses... 3 ARTICLE 4 PLANS AND SPECIFICATIONS Delivery of Plans and Specifications to Manager Review of Plans and Specifications Changes to Plans and Specifications After Approval by Manager Compliance with Brand and Brand Standards... 6 ARTICLE 5 DEVELOPMENT AND CONSTRUCTION OF THE HOTELS Owner s Development and Construction Team Commencement and Completion of the Hotels Periodic Reports and Information... 7 ARTICLE 6 COVENANTS... 7 ARTICLE 7 CONFIDENTIALITY Confidential Information ARTICLE 8 ASSIGNMENTS Assignment by Manager Assignment by Owner ARTICLE 9 INSURANCE AND INDEMNIFICATION Insurance i -

3 9.2 Indemnification ARTICLE 10 DEFAULTS AND TERMINATIONS Event of Default Remedies for Event of Default Cross-Termination with Other Agreements Termination Due to Hotel Construction Actions To Be Taken on Termination ARTICLE 11 JURISDICTION AND VENUE Submission to Jurisdiction Claims by Manager Manager Disputes Waiver of Consequential and Punitive Damages Survival and Severance ARTICLE 12 REPRESENTATIONS AND WARRANTIES Owner s Representations and Warranties Manager s Representations and Warranties OWNER S ACKNOWLEDGEMENTS ARTICLE 13 GENERAL PROVISIONS Governing Law Miscellaneous Instruments Estoppel Certificates Construction of this Agreement Limitation of Liability LIMITATION ON MANAGER S DUTIES AND OBLIGATIONS Waivers Notices Owner s Representative Further Assurances Relationship of the Parties Force Majeure Counterparts; Facsimile and Electronic Execution Illinois Freedom of Information Act ii -

4 LIST OF EXHIBITS EXHIBIT A - DESCRIPTION OF PROJECT; TECHNICAL SERVICES FEES EXHIBIT B - DEFINITIONS EXHIBIT C - TECHNICAL SERVICES EXHIBIT D - PROJECT SCOPE AND COST EXHIBIT E - INSURANCE REQUIREMENTS EXHIBIT F - SPECIAL CONDITIONS FOR PROFESSIONAL SERVICES MBE & WBE EXHIBIT G - BRAND STANDARDS - iii -

5 TECHNICAL SERVICES AGREEMENT This Technical Services Agreement (this Agreement ) is made and entered into as of the day of, 20 (the Effective Date ), between the CITY OF CHICAGO, a municipal corporation, home rule unit of local government organized and existing under Article VII, Sections 1 and 6(a), respectively, of the 1970 Constitution of the State of Illinois ( Owner or the City ), and, a ( Manager ). (Owner and Manager are sometimes referred to individually as a Party and collectively in this Agreement as the Parties ). RECITALS A. Owner holds the beneficial rights to the real property described in Exhibit A (the Premises ), on which site Owner intends to (i) renovate the existing hotel more specifically described in Exhibit A (the Existing Hotel ), and (ii) develop and build a Brand hotel as more specifically described in Exhibit A (the New Hotel ) (The Existing Hotel and New Hotel are each referred to herein as the Hotel and collectively as the Hotels or the Sites ). B. The Owner issued a Request for Proposals on November 9, 2016 (the RFP ) for management of and technical services relating to the development and renovation of the Hotels. Manager responded to the RFP with its proposal dated, 2017 ( Manager s Proposal ). Owner has evaluated all of the proposals submitted in response to its RFP, and has selected the Manager to provide technical services in connection with the renovation of the Existing Hotel and the development of the New Hotel pursuant to the terms and conditions set forth herein and in the Technical Services Agreement relating to the [New Hotel] dated as of the date hereof. By action of the City Council of the City on, 2017 execution and delivery of this Agreement was authorized, but not directed. C. Manager is experienced in the planning, designing, equipping, decorating and furnishing of hotels and related facilities and amenities, and in advising third parties in connection with such activities. D. Owner desires to engage Manager as an independent contractor to assist Owner and its architects, engineers, designers and consultants in the planning, designing, equipping, decorating and furnishing of the Hotels, and Manager desires to perform such services, subject to the terms in this Agreement. E. Owner and Manager have entered or intend to enter into a Management Agreement (the Management Agreement ) for the operation of the Hotels by Manager upon the completion and opening of each Hotel. AGREEMENT NOW, THEREFORE, in consideration of the recitals, promises and covenants set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree:

6 ARTICLE 1 DEFINITIONS AND EXHIBITS 1.1 Definitions. All capitalized terms used without definition in this Agreement shall have the meanings assigned to such terms in Exhibit B, and if not defined in Exhibit B shall have the meanings assign to such terms in the Management Agreement. 1.2 Exhibits. The exhibits listed in the table of contents and attached hereto are incorporated in, and deemed to be an integral part of, this Agreement. ARTICLE 2 TECHNICAL SERVICES 2.1 Engagement of Manager. Subject to the terms of this Agreement, Owner hereby engages Manager, and Manager hereby accepts such engagement by Owner, to provide the Technical Services as set forth in this Agreement. 2.2 Technical Services. During the Term of this Agreement, Manager shall perform the technical services specified in this Agreement upon delivery by Owner to Manager of the various documents, materials and information required under this Agreement, including (a) advising Owner regarding the design, programming and operational aspects of the Hotels, including compliance with any applicable Brand Standards, (b) reviewing plans and specifications for the Hotels, (c) making recommendations to the plans and specifications to the extent Manager deems appropriate, (d) approving plans and specifications when acceptable in accordance with the terms of this Agreement, and (e) preforming certain pre-opening activities for the Hotels (collectively with those items set forth on Exhibit C, the Technical Services ). Manager shall perform all services specified in this Agreement utilizing Manager s best skill and judgment and efficient business administration to further the interests of Owner. Manager further agrees at all times to perform the Technical Services in the best, most expeditious and most economical manner consistent with the interests of Owner, and Manager will devote such time and staff as may be required for the efficient and timely performance of all such Technical Services. 2.3 Site Visits. Manager shall (a) make regular visits to the site as appropriate given the phase of construction and/or to the offices of Owner or its architects, engineers, designers, contractors, manufacturers or other Persons involved in the Hotels, and (b) maintain one or more representatives on-site throughout the Construction of the Hotels, as Manager considers necessary, appropriate or advisable to perform the Technical Services, or otherwise upon the reasonable request of Owner. Manager shall attend all design, development and construction meetings related to the development of the Hotels. Manager s representatives shall be given full access at all times upon Manager s request to all (i) financial, development and other information related to the Hotels and back-up materials, and (ii) the site of the Hotels and the Construction in process. 2.4 Inspections. Owner hereby grants to Manager and its inspectors the right to enter the site on which the Hotels are being constructed, without notice, at any time during the 2

7 Construction, and to access any Persons providing goods or services for the Construction or such other work, in order to conduct an inspection of the Hotels to confirm its compliance with the Approved Plans and Specifications, the Design Guide and the Brand Standard. Manager shall promptly notify Owner of any deficiencies of the Hotels that Manager finds during any such inspection. Owner acknowledges that Manager may use Corporate Personnel or retain a thirdparty inspection service to perform any of Manager s inspections. Owner acknowledges and agrees that Manager s inspection will be limited to ensuring that the Construction of the Hotels complies with the Approved Plans and Specifications, the Design Guide and the Brand Standard, but shall not constitute an inspection of compliance with Applicable Laws. In addition, upon substantial completion of the Construction, Manager shall participate in the inspection of the Hotels with Owner s consultants and contractors, and assist Owner s architects, engineers, contractors and consultants in the preparation of a punch list of deficiencies requiring correction or completion (the Deficiency List ) to complete the Construction. 2.5 Use of Affiliates by Manager. Owner acknowledges and agrees that in performing its obligations under this Agreement, Manager may from time to time use the services of one or more of its Affiliates; provided, however, that (a) Manager shall be responsible to Owner for its Affiliate s performance, and (b) Owner shall not pay more for the Affiliate s services and expenses than Manager would have been entitled to receive under this Agreement had Manager performed the services. If an Affiliate of Manager performs services for or provides goods to the Hotels, such goods or services shall be supplied at prices and on terms at least as favorable to the Hotels as generally available from third parties in arms-length transactions in the relevant market and consistent with terms made available to other Brand hotels receiving such goods and services. 2.6 Term. This Agreement shall be for a period (the Term ) commencing on the Effective Date and expiring without notice upon the Opening Date, unless terminated earlier in accordance with the terms of this Agreement. ARTICLE 3 FEES AND EXPENSES 3.1 Technical Services Fee. Owner shall pay to Manager a total fee in the amount of [to be proposed by Respondents] ($ ) (the Technical Services Fee ) in accordance with this Article Reimbursable Expenses. Owner shall reimburse Manager for all approved Reimbursable Expenses incurred by Manager in accordance with this Article Accrual after Opening Date. Owner acknowledges that the Technical Services Fee and Reimbursable Expenses may be incurred or accrued after the Opening Date, in accordance with this Agreement, and Owner agrees to pay any such Technical Services Fee and Reimbursable Expenses, whether incurred or accrued prior to, during or after the Term in accordance with this Article Payment of Fees and Expenses. 3

8 3.4.1 Monthly Statements. Manager shall submit to Owner a monthly statement and payment request ( Monthly Statement ) including (a) a statement of all Reimbursable Expenses incurred by Manager during the prior calendar month (accompanied by substantiation of such Reimbursable Expenses in a form acceptable to Owner), (b) a statement of all Reimbursable Expenses anticipated to be incurred with respect to the next calendar month (accompanied by such supporting information as Owner may request), (c) a statement of any portion of the Technical Services Fee then due or to become due during such calendar month, and (d) a reconciliation of the amounts previously funded by Owner against the Technical Services Fee and Reimbursable Expenses incurred or anticipated to be incurred in the next calendar month. Manager shall provide a final accounting and statement to Owner for the Technical Services Fee and all Reimbursable Expenses and any other outstanding amounts that are owed to Manager within 120 days after the Opening Date Due Dates. The Technical Services Fee shall be paid to Manager in [Respondents to provide] equal monthly installments commencing one-month following the execution of this Agreement and continuing on the first day of each calendar month thereafter until paid in full. The Reimbursable Expenses shall be due 60 days after delivery to Owner of the Monthly Statements Place and Means of Payment. All fees and other amounts due to Manager or its Affiliates under this Agreement shall be paid to Manager in U.S. Dollars, in immediately available funds, at the location(s) specified by Manager from time to time. ARTICLE 4 PLANS AND SPECIFICATIONS 4.1 Delivery of Plans and Specifications to Manager Timelines for Delivery of Plans and Specifications. Owner shall provide the documents, materials and information to be submitted to Manager as set forth in Exhibit C, within the following time periods: (a) Conceptual plans and specifications showing general layout and design shall be delivered to Manager no later than [City to provide] ; (b) Preliminary plans and specifications showing general layout and design shall be delivered to Manager no later than [City to provide] ; (c) Final plans and specifications showing general layout and design shall be delivered to Manager no later than [City to provide] ; and (d) Plans, specifications, renderings and working drawings relating to the interior design and decoration, and other matters affecting the operating efficiency of the Hotels and the selection of all FF&E and all operating equipment at various stages showing general layout and design shall be delivered to Manager periodically, when requested by Manager and as required under the Design Approval Policy. 4

9 4.1.2 Extension of Timelines for Delivery. The dates set forth in Section for the delivery of all plans, specifications and other documents and materials relating to the Hotels (collectively, the Review Materials ) may be extended as necessary by agreement of the parties, and shall be extended for a Force Majeure event in accordance with Section 13.12; provided, however, no such extension shall be granted unless Manager is provided with notice of such delay at least 14 days prior to the required due date (except for events which occur within the 14 day period prior to the due date, in which case, Owner shall notify Manager of any anticipated delay as soon as reasonably possible following such Force Majeure) Method of Delivery. All Review Materials to be submitted to Manager for its approval under this Agreement (including Exhibit C) shall be sent to Manager in accordance with Section Owner shall provide Manager with such numbers of copies as Manager may reasonably require, and shall provide photographs for all renderings and color boards included in the Review Materials. 4.2 Review of Plans and Specifications Manager shall review the Review Materials to determine whether such Review Materials comply with the Design Guide and the Brand Standard. Manager shall either approve or reject the Review Materials submitted to Manager by providing notice to Owner within 10 Business Days after receipt by Manager of any Review Materials. If Manager rejects any Review Materials, Manager shall provide written comments and proposed corrections to Owner for re-submittal to Manager. If Manager does not provide notice of approval or rejection within such 10 Business Day period, the Review Materials submitted shall be deemed to be disapproved. The terms approval, approve or approved when used in reference to Manager s review of any plans and specifications or items therein shall mean Manager s acceptance that the plans and specifications or items in question comply with the Design Guide and Brand Standard, or are otherwise accepted by Manager. Notwithstanding the foregoing, Owner shall have the right to deliver to Manager a second request for Manager s review and approval (the Second Request ), which shall include in bold, capital letters the following statement: THIS IS A SECOND NOTICE FOR REVIEW AND APPROVAL BY MANAGER. FAILURE TO RESPOND TO THIS NOTICE WITHIN FIVE BUSINESS DAYS WILL RESULT IN THE DEEMED APPROVAL BY MANAGER OF THE MATERIALS SUBMITTED WITH THIS NOTICE. If Manager does not respond to such Second Request within five Business Days after Manager s receipt of such Second Request, the items submitted shall be deemed approved. If any Review Materials or other items submitted to Manager are disapproved or deemed disapproved, Owner shall have the right to revise and modify such items to comply with objections of Manager; provided, however, that Owner shall resubmit such items to Manager for approval pursuant to this Section 4.2. If Owner makes any material modifications or changes to any Review Materials or other items approved by Manager, Owner shall resubmit such items to Manager for approval in accordance with this Section Changes to Plans and Specifications After Approval by Manager. If Owner makes any material changes to any Review Materials approved by Manager, such revised Review Materials shall be subject to Manager s re-approval in accordance with this Article 4. 5

10 4.4 Compliance with Brand and Brand Standards. Owner acknowledges and agrees that the Hotels will be deemed not to comply with the Design Guide and Brand Standard for the purposes of this Agreement and the Management Agreement, unless and until Manager approves the plans and specifications described in Exhibit C in accordance with Article 4, and the Hotels are constructed in accordance with such Approved Plans and Specifications. ARTICLE 5 DEVELOPMENT AND CONSTRUCTION OF THE HOTELS 5.1 Owner s Development and Construction Team. Owner shall engage, at its own cost and expense, such reputable and qualified architects, contractors, engineers, decorators and other professionals, specialists and consultants as may be necessary or desirable to complete the Hotels as set forth in Exhibit D, including all aspects for the development, design, architecture, construction and furnishing of the Hotels as required under the Design Guide and Brand Standards. The plans and specifications for the Hotels shall be prepared by a duly licensed architect, at Owner s expense, and in compliance with the Design Guide and Brand Standard, and the contractors engaged by Owner shall be responsible for supervision of the Construction of the Hotels. The engagement by Owner of such professionals shall be through a public procurement process. A representative of Manager shall sit on the Evaluation Committee for the public procurement as a technical advisor if any of the public procurement is qualification-based. 5.2 Commencement and Completion of the Hotels Timeline for the Hotels. Owner shall use commercially reasonable efforts to (a) provide or obtain all financial and other resources necessary to complete the development and Construction of the Hotels in accordance with this Agreement, (b) perform all work necessary to cause the Start of Construction to occur prior to [City to provide], with time being of the essence, and (c) perform all work necessary to cause the Opening Date to occur before [City to provide], with time being of the essence, all in accordance with the Approved Plans and Specifications, the Design Guide, the Brand Standard and all Applicable Laws Inspections. Owner, at its expense, shall take such actions as reasonably necessary to correct any undisputed deficiencies (as determined in accordance with the terms of this Agreement) detected during such an inspection of the Construction by Manager. In addition, if Manager and Owner permit the opening of the Hotels prior to completion of the items on the Deficiency List, Owner, at its expense, shall take such actions as necessary to complete all remaining items on the Deficiency List. This Section shall survive the Opening Date Necessary Approvals. Owner, at its expense, shall obtain all Approvals necessary to perform the work required for the Construction prior to the Start of Construction, including construction permits, from all Governmental Authorities having jurisdiction over the Hotels and the business to be operated therein, and maintain all such 6

11 Approvals throughout the Construction. Manager shall cooperate with owner fully as necessary in securing such Approvals. 5.3 Periodic Reports and Information Progress Reports. Owner shall prepare and deliver (or cause its architects or contractors to prepare and deliver) to Manager periodic progress reports (the Progress Reports ), in reasonable detail, outlining the progress of all major activities related to the Hotels, including the development, design, construction and furnishing of the Hotels and containing such other information as the Owner and Manager may agree to include. In addition, Owner also shall provide Manager with copies of any progress reports provided to Owner from its architects, engineers, contractors, consultants or any other Person involved with the Construction of the Hotels Cooperation from Owner s Team. In addition to the Progress Reports, Owner shall use commercially reasonable efforts to cause its architects, engineers, contractors, consultants and all other Persons involved with the Hotels to cooperate with Manager in performing its obligations under this Agreement, including providing promptly upon Manager s request all information and documentation reasonably requested by Manager in connection with Manager s performance of its obligations, and confirmation of Owner s compliance with the performance of its obligations under this Agreement. ARTICLE 6 COVENANTS 6.1 Manager covenants and agrees that during the term of this Agreement, unless Owner otherwise consents in writing, Manager and its Affiliates shall be subject to the following: Cooperation. Manager agrees to observe and perform its duties and obligations hereunder in a spirit of full cooperation with respect to any and all matters contemplated by this Agreement to achieve successful completion of the Hotels. Manager agrees in good faith to: (a) Commence promptly, pursue diligently, and complete in a timely manner whatever acts are required hereunder; (b) Cooperate fully with Owner and its architects, engineers, contractors and consultants in the agreed review (and requested modifications wherever reasonably required) of the various phases of the Hotels design and construction and not unreasonably withhold its consent or approval when such is required; (c) Ensure that its duties under the [Existing Hotel/New Hotel] Technical Services Agreement are performed so as to provide for the most efficient, effective, and economically practical method of performing Manager s duties under this Agreement and Manager s duties under the [Existing Hotel/New Hotel] Technical Services Agreement. 7

12 (d) Provide a complete and accurate response to all written or verbal communications from Owner; and (e) Keep Owner regularly and reasonably informed of the progress being made in the performance and review of each phase of the Hotels Applicable Laws. Manager shall, at its sole cost and expense, comply, and shall cause its respective agents and employees to comply, with all applicable federal, state and local laws, codes, regulations, ordinances, rules, and orders including, without limitation, those promulgated by the FAA, those set forth in Article 15 of the Management Agreement, and the following: (a) All applicable federal, state, and local non-discrimination laws, codes, regulations, ordinances, rules, and orders, including without limitation those set forth in Section 15.1(a) of the Management Agreement; (b) All applicable federal, state, and local equal employment opportunity laws, codes, regulations, ordinances, rules, and orders, including without limitation those set forth in Section 15.1(b) of the Management Agreement; (c) All applicable federal, state, and local prevailing wage laws, codes, regulations, ordinances, rules, and orders; (d) Any and all federal, state and local laws and regulations regarding accessibility standards for disabled or environmentally limited persons, including without limitation those set forth in Section 15.1(h) of the Management Agreement; (e) Section of the Municipal Code of Chicago ( Code ); (f) Chapters 2-55 and 2-56 of the Code and cooperate with the Office of Inspector General and Office of Legislative Inspector General in any investigation or hearing; (g) Chapter of the Code, Governmental Ethics, including but not limited to Section of Chapter of the Code; (h) Section of the Code; (i) Antidumping provisions of the Code, including Sections, , ; ; ; ; ; and (j) 29 CFR Part 1926 (originally 29 CFR Part 1518) Safety and Health Regulations for Construction of the Williams-Steiger Occupational Safety and Health Act of 1970, 40 U.S.C. 333 et seq. ( OSHA ); (k) (l) Illinois Public Mechanics Lien Act, 770 ILCS 60/1 et seq.; Wage Payment and Collection Act, 820 ILCS 115/1 et seq; 8

13 Contributions). (m) Mayoral Executive Order No (Prohibition on Certain Copyright Waiver. Manager shall obtain a written waiver of all rights under Section 106A(a)(3) and Section 113(d) of the Copyright Act as necessary from any employees, contractors, subcontractors, or any artists Certification. Manager shall complete an affidavit in the form approved by Owner ( City Disclosure Affidavit ), including certifications that Manager, its agents, employees, officers and any contractors (i) have not been engaged in or been convicted of bribery or attempted bribery of a public officer or employee of Owner, the State of Illinois, any agency of the federal government or any state or local government in the United States or engaged in or been convicted of bid-rigging or bid-rotation activities as defined in this Section as required by the Illinois Criminal Code; (ii) do not owe any debts to the State of Illinois, in accordance with Section of the Illinois Municipal Code; and (iii) are not presently disbarred or suspended Disclosure of Ownership. Manager shall execute and shall cause its contractors to execute a City Disclosure Affidavit, including the disclosure of retained parties. Pursuant to Chapters 2-92 and of the Code, Manager and any person having more than a seven and one-half percent (7½%) direct or indirect ownership interest in Manager, and any person, business entity or agency contracting with Owner shall be required to complete Part I, Disclosure of Ownership Interests, and Part VIII, Certification Regarding Business Relationships with Elected Officials, of the City Disclosure Affidavit City Resident Employment Requirements. Manager shall utilize good faith efforts to comply with the minimum percentage of total worker hours performed by actual residents of the City of Chicago as specified in Section of the Code. To facilitate these efforts, the Manager will establish a City of Chicago Community Hiring Program for all new hires at the Hotels, which Community Hiring Program shall be satisfactory to the Owner Affirmative Action Program. Manager will undertake an affirmative action program which sets forth all applicable Federal standards as required by 14 C.F.R. Part 152, Subpart E, to insure that no person shall on the grounds of race, creed, color, religion, age, national origin, or sex be excluded from participating in any employment activities covered in 14 C.F.R. Part 152, Subpart E. Manager assures that no person shall be excluded on these grounds from participating in or receiving the services or benefits of any program or activity covered by Subpart E. Manager will require its covered sub-organizations to provide assurances to Manager that they similarly will undertake an affirmative action program and that they will require assurances from their organizations, as required by 14 C.F.R., Part 152, Subpart E, to the same effect Manager s MBE/WBE Commitment. The Manager agrees for itself and its successors and assigns, and, if necessary to meet the requirements set forth herein, shall contractually obligate its contractors to agree, that it will endeavor, as one of its publicly stated goals, to accomplish the following: 9

14 (a) Consistent with the findings which support the Minority-Owned and Women-Owned Business Enterprise Procurement Program, Section et seq., of the Code (the MBE/WBE Program ), and in reliance upon the provisions of the MBE/WBE Program to the extent contained in, and as qualified by, the provisions of this Section 6.1.8, during the Term of this Agreement, Manager shall make good faith efforts to meet its commitments with respect to participation of MBE/WBE as set forth in Exhibit F ( Special Conditions for Professional Services MBE & WBE ). The stated goals for MBW/WBE are at least twenty-five percent (25%) of the aggregate Technical Services Fee shall be expended for contract participation by minority-owned businesses and at least five percent (5%) of the MBE/WBE Budget shall be expended for contract participation by women-owned businesses. To the extent the Manager s Proposal commits the Manager to exceed the percentages than those required in this Section 6.1.8(a) above, the higher percentages set forth in the Manager s Proposal shall control. (b) For purposes of this Section only: (i) The Manager (and any party to whom a contract is let by the Manager in connection with the Improvements) shall be deemed a Contractor and this Agreement (and any contract let by the Manager) shall be deemed a non-construction contract as such term is defined in Section , of the Code, as applicable. (ii) The term minority-owned business or MBE shall mean a business identified in the Directory of Certified Minority Business Enterprises published by the City s Department of Procurement Services, or otherwise certified by the City s Department of Procurement Services as a minority-owned business enterprise, as applicable. (iii) The term women-owned business or WBE shall mean a business identified in the Directory of Certified Women Business Enterprises published by the City s Department of Procurement Services, or otherwise certified by the City s Department of Procurement Services as a women-owned business enterprise, as applicable. (c) Consistent with Sections , et seq., of the Code, the Manager s MBE/WBE commitment may be achieved in part by the Manager s status as an MBE or WBE (but only to the extent of any actual work performed by the Manager) or by a joint venture with one or more MBEs or WBEs (but only to the extent of the lesser of (i) the MBE or WBE participation in such joint venture, or (ii) the amount of any actual work performed by the MBE or WBE); by the Manager utilizing a MBE or a WBE (but only to the extent of any actual work performed by the general contractor); by subcontracting or causing contractor to subcontract to one or more MBEs or WBEs; by the purchase of materials or services used in the construction of the Improvements from one or more 10

15 MBEs or WBEs; or by any combination of the foregoing. Those entities which constitute both a MBE and a WBE shall not be credited more than once with regard to the Manager s MBE/WBE commitment as described in this Section In accordance with Exhibit F, the Manager shall not substitute any MBE or WBE without the prior written approval of CDA. (d) The Manager shall deliver quarterly reports to the City s monitoring staff during the term describing its efforts to achieve compliance with this MBE/WBE commitment. Such reports shall include, inter alia, the name and business address of each MBE and WBE solicited by the Manager, and the responses received from such solicitation, the name and business address of each MBE or WBE actually involved in the construction of the Improvements, a description of the work performed or products or services supplied, the date and amount of such work, product or service, and such other information as set forth in Exhibit F and otherwise as may assist the City s monitoring staff in determining the Manager s compliance with this MBE/WBE commitment. The Manager shall maintain records of all relevant data with respect to the utilization of MBEs and WBEs in connection with the operation of its Hotels for at least five (5) years and the City s monitoring staff shall have access to all such records maintained by the Manager, on prior notice of at least five (5) Business Days, to allow the City to review the Manager s compliance with its commitment to MBE/WBE participation and the status of any MBE or WBE performing any portion of the construction of the Improvements. (e) Upon the disqualification of any MBE or WBE, if the disqualified party misrepresented such status, the Manager shall be obligated to discharge or cause to be discharged the disqualified party, and, if possible, identify and engage a qualified MBE or WBE as a replacement. For purposes of this subsection (e), the disqualification procedures are further described in Code Sections and , as applicable. (f) Any reduction or waiver of the Manager s MBE/WBE commitment as described in this Section shall be undertaken in accordance with Code Sections and , as applicable. (g) The Manager shall also comply with the provisions contained in Exhibit F attached hereto which are in addition to the requirements of this Section Federal Terrorist (No-Business) List. Manager represents and warrants that neither Manager nor any Affiliate is listed on any of the following lists maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the Bureau of Industry and Security of the U.S. Department of Commerce or their successors, or on any other list of persons or entities with which Owner may not do business under any applicable laws: the Specially Designated Nationals List, the Denied Persons List, the Unverified List, the Entity List and the Debarred List. 11

16 Ethics/Conflict of Interest. Manager covenants that, in the performance of this Agreement, no person having any conflicting interest will be assigned to perform any obligations or have access to any confidential information, if any, under this Agreement. If Owner, by the Commissioner in her or his reasonable judgment, determines that any of Manager s obligations for others conflict with Manager s obligations under this Agreement, Manager must terminate such other services immediately upon request of Owner Airport Matters. (a) Rules and Regulations. Manager shall observe and obey all rules and regulations governing the conduct and operation of the Airport promulgated from time to time by Owner, county, state or federal authorities and, in particular, Manager agrees at all times to comply with any master security plan and procedures for the Airport as may be established by Owner from time to time. In emergency cases Owner shall deliver to Manager such emergency rules and regulations as promptly as practical. (b) Other Legal Requirements. Manager covenants and agrees that this Agreement involves the use of or access to space on, over or under real property acquired or improved under the Airport Improvement Program of the Federal Aviation Administration ( FAA ), and therefore involves activity which serves the public. Manager, for itself, and its respective successors in interest, and assigns, will agree that (i) no person on the grounds of race, creed, color, religion, age, sex or national origin shall be excluded from participation in, denied the benefits of, or otherwise be subjected to discrimination in the use of said facilities; (ii) that no person on the grounds of race, creed, color, religion, age, sex or national origin shall be excluded from participation in, denied the benefits of, or otherwise be subjected to discrimination in the construction of improvements on, over, or under such land and the furnishing of services thereon; and (iii) that Manager shall use the Hotels in compliance with all other requirements imposed by or pursuant to regulations of the U.S. Department of Transportation. (c) Airport Agreements. Manager s use and occupancy of the Hotels shall be and remain subject and subordinate to (a) the provisions of any existing or future agreements between Owner and the United States government, the FAA or other governmental authority, relative to the operation or maintenance of the Airport, the execution of which has been or will be required as a condition precedent to the granting of federal or other governmental funds, including, without limitation, any grant agreements, (b) any use agreement heretofore or hereafter executed by Owner with airlines operating at the Airport, (c) any ordinance or indenture, or both, adopted by City Council of Owner authorizing the issuance of notes, bonds or other obligations for the Airport and securing such obligations by a pledge of revenues or net revenues of the Airport and any ordinance or indenture supplemental thereto, which shall also include any master indenture and (d) any applicable airport minimum standards. Manager further agrees that it shall not cause Owner to violate any assurances made by Owner to the federal government in connection with the granting of such federal funds. (d) All of the drawings, plans, specifications, or other documentation (including the Plans and Specifications) to be delivered by Owner to Manager under this Agreement, and any other information or data, whether in hard copy or in electronic form 12

17 (collectively, Data ), prepared by or provided to Manager under this Agreement are confidential and may constitute Security Sensitive Information. Manager acknowledges that such Data may contain information vital to the security of the Airport and agrees that, except as specifically authorized herein or as may be required by law, such Data will be made available to its employees, Contractors, lenders and holders of equity interests in Manager, only on a need-toknow basis and must not be made available to any other individual or organization, except the Commissioner, without the written consent of the Commissioner. Manager is liable to Owner for costs reasonably incurred by Owner, the air carriers, the Federal Aviation Administration, or the Transportation Security Administration ( TSA ) to undertake security measures required to be implemented due to Manager s failure to comply with this section, including without limitation the design and construction of improvements and posting of guards. (e) Regulating the Airport; Airport Operation. Manager acknowledges that Owner reserves the right to regulate, police and further develop, improve, reconstruct, modify, or otherwise alter the Airport in Owner s sole discretion. Owner reserves the right, but shall not be obligated to Manager, to maintain and keep in repair all publicly owned facilities of the Airport. Owner shall not have any obligation to continue to operate the Airport or any part as an airport for passenger or freight air transportation or at any particular level of operation and may at any time limit or discontinue use of the Airport or any means of access to or within the Airport in whole or part. (f) FAA Policy and Procedures Memorandum Airport Division, Number Manager covenants and agrees to comply with those portions of the FAA s Policy and Procedures Memorandum Airport Division, Number applicable to Manager and the Hotels. ARTICLE 7 CONFIDENTIALITY 7.1 Confidential Information. The Parties acknowledge that each Party will provide certain information to the other Party that is confidential (the Confidential Information ), and that such Confidential Information is proprietary to such Party. Accordingly, during the Term and thereafter, the Parties (a) agree to maintain the confidentiality of all such Confidential Information and terms of this Agreement, and shall not disclose any such Confidential Information or the terms of this Agreement to any third Person (including the media), except to its shareholders, partners, trustees, beneficiaries, directors, officers, employees, agents, legal counsel, accountants, investors, lenders and other professionals and consultants, but only on a need to know basis in connection with the Hotels; and (b) shall make every effort to ensure that none of its shareholders, partners, members, trustees, beneficiaries, directors, officers, employees, agents or representatives use, disclose or copy any Confidential Information, disclose any terms of this Agreement or take any other actions that are otherwise prohibited under this Section 7.1. Notwithstanding the foregoing, the restrictions on the use and disclosure of Confidential Information shall not apply (i) to information or techniques which are or become generally known in the lodging industry (other than through a Party s disclosure), provided a Party obtains the prior written consent to such disclosure or use from the Party providing such Confidential Information, or (ii) to the extent such disclosure is required under Applicable Laws, 13

18 including reporting requirements applicable to public companies. The Parties acknowledge that the disclosure or unauthorized use of any Confidential Information will cause irreparable injury to the Party providing such Confidential Information, for which monetary damages would not provide an adequate remedy. This Section 7.1 shall survive the expiration or termination of this Agreement. ARTICLE 8 ASSIGNMENTS 8.1 Assignment by Manager. Manager shall have the right after thirty (30) days prior written notice to Owner to assign its rights and obligations under this Agreement, but only with the consent of Owner, which shall not be unreasonably withheld, to any Affiliate which assumes all of Manager s obligations hereunder in writing and which such Affiliate is qualified to perform each and every Manager obligation hereunder. In the event of such an assignment to an Affiliate, Manager shall continue to remain primarily liable under this Agreement to the same extent as though such assignment had not been made. In the event of a sale or assignment of all or substantially all of the assets of Manager or any Affiliate having practical control over the operation of all or substantially all of the Brand Hotels, or a controlling interest therein to a third party (collectively, a Manager Assignment ), Owner s consent shall be required, but shall not be unreasonably withheld, and if such consent is not granted, Owner or Manager shall each have the right and option (exercisable no later than 120 days after Owner s receipt of written notice of the Manager Assignment) to terminate this Agreement with no penalty to Owner. Manager covenants that any sale or assignment of all or substantially all of its assets or any Affiliate having practical control over the operation of all or substantially all of the Brand Hotels shall include the interest of Manager in this Agreement and the management agreements for all or substantially all, as the case may be, of the other Brand Hotels. Except as hereinabove provided, Manager shall not have the right to assign any of its rights, interests and/or obligations under this Agreement, without the consent of Owner, which consent may be withheld in Owner s sole and absolute discretion. Notwithstanding the foregoing, Manager shall be prohibited from assigning this Agreement to any Prohibited Party. A Prohibited Party shall mean any person or entity (or any Affiliate of any Person) who: (i) does not, in Owner s reasonable discretion as applicable, have sufficient financial resources and liquidity to fulfill Manager s obligations under this Agreement, as applicable; (ii) is affiliated with the government of any country with which, or is itself a company with which, corporate citizens of the United States of America are prohibited from transacting business by any law, regulation or decree of the United States of America or its political subdivisions, is not identified (nor is any of its principals or Affiliates identified) either by name or an alias, pseudonym or nickname, on the lists of Specially Designated Nationals or Blocked Persons maintained by the U.S. Treasury Department s Office of Foreign Assets Control, or has violated any law prohibiting corrupt business practices, money laundering or the aid or support of persons or entities who conspire to commit acts of terror against any person or government, including acts prohibited by the U.S. Patriot Act and U.S. Executive Order (a Restricted Person ); (iii) is known in the community as being of bad moral character, or has been convicted of a felony in any state or federal court, or is in control of or controlled by 14

19 persons who have been convicted of felonies in any state or federal court; (iv) would cause the denial, threatened denial, loss, threatened loss or termination of any material license (including, without limitation, a liquor license) of Owner, the Hotels, Manager, or its Affiliates; or (v) has been debarred from providing goods or services to the City. 8.2 Assignment by Owner This Agreement and all of Owner s rights and all of Owner s duties hereunder are freely assignable by Owner, provided the following requirements are met: (a) Owner delivers a notice (a Transfer Notice ) to Manager setting forth (a) the name of the Person to whom the transfer will be made (the Transferee ); (b) a list of the names, addresses of the direct and indirect owners of the Transferee and, if the owners are individuals, the date, place of birth and country of residence; and (c) other information made available to Owner as a result of the transfer process, such notice to be given at least 30 days before finalizing the transfer; (b) The Transferee has sufficient financial resources to fulfill the obligations of Owner under this Agreement; (c) Neither the Transferee nor any of its Affiliates is known in the community as being of bad moral character, or has been convicted of a felony involving moral turpitude, or is in control of or controlled by Persons who have been convicted of a felony involving moral turpitude; (d) Neither the Transferee nor any of its Affiliates is, or has the direct or indirect power to direct or cause the direction of the management and policies of, a company that operates or licenses a collection or branded chain of hotels or other lodging facilities that competes with Manager or its Affiliates; (e) Neither the Transferee nor any of its Affiliates, nor any other Person that directly or indirectly owns, has an ownership interest in, or controls the Transferee or any of its Affiliates is a Restricted Person Without limiting the generality of and notwithstanding Section 8.2.1, Owner shall have the right to mortgage, hypothecate, encumber, pledge, assign or grant a security interest in the Hotels or this Agreement in connection with the Bonds (as defined in the Management Agreement) or other financing transaction Upon the sale or other transfer of the Hotels (a Sale ), the purchaser or other transferee shall expressly assume, on the same exculpatory basis as provided in Section 13.5 herein, in writing, Owner s obligations under this Agreement, and this Agreement shall remain in full force and effect. In such event, Owner shall have no further liability of whatsoever nature or kind to Manager with respect to the Hotels, as the case may be, and Manager and Owner shall release each other in writing from any liability relating to events occurring after such sale and any liability occurring prior to such sale, to the extent of such 15

20 purchaser s or transferee s assumption thereof. For purposes of this Section, the term Sale shall include, without limitation, the sale, transfer or assignment by Owner of any interest in the Hotels or this Agreement in excess of fifty percent (50%) of the beneficial interest therein. Notwithstanding the foregoing, any transfer (other than a foreclosure) to a lender of a participation or any other interest in the Hotels or a transfer to a governmental entity that is a successor to Owner as a result of a legislative restructuring of Owner (or the reorganization or transfer of governmental responsibilities of Owner), shall not be deemed a Sale and this Section shall not apply to such transfers. 9.1 Insurance. ARTICLE 9 INSURANCE AND INDEMNIFICATION Insurance Policies. Manager must provide and maintain at Manager's own expense, during the term of the Agreement and during the time period following expiration if Manager is required to return and perform any work, services, or operations, the insurance coverages and requirements specified in Exhibit E, insuring all work, services, or operations related to the Agreement. 9.2 Indemnification Indemnification by Owner. Subject to Sections Error! Reference source not found. and 9.2.3, Owner shall defend, indemnify, and hold harmless Manager and its Affiliates, and their respective shareholders, trustees, beneficiaries, directors, officers, employees and agents, and the successors and assigns of each of the foregoing (collectively, the Manager Indemnified Parties ) for, from and against any and all Claims that any Manager Indemnified Parties incur to the extent caused by Owner s Gross Negligence or Willful Misconduct Indemnification by Manager. Subject to Sections Error! Reference source not found., 9.2.3, Manager shall defend, indemnify, and hold harmless Owner and its Affiliates, and their respective elected officials, commissioners, trustees, beneficiaries, directors, officers, employees and agents, and the successors and assigns of each of the foregoing (collectively, the Owner Indemnified Parties ) for, from and against any and all Claims that any Owner Indemnified Parties incur to the extent caused by Manager s Negligence or Willful Misconduct Indemnification Procedures. Any Indemnified Party shall be entitled, upon written notice to the Indemnifying Party, to the timely appointment of counsel by the Indemnifying Party for the defense of any Claim, which counsel shall be subject to the approval of the Indemnified Party. If, in the Indemnified Party s judgment, a conflict of interest exists between the Indemnified Party and the Indemnifying Party at any time during the defense of the Indemnified Party, the Indemnified Party may appoint independent counsel of its choice for the defense of the Indemnified Party as to such Claim. In addition, regardless of whether the Indemnified Party has appointed counsel or selects independent counsel (a) the Indemnified Party shall have the right to participate in the defense of any Claim and approve any proposed 16