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PARKING LICENSE AGREEMENT
This Parking License Agreement (this “Agreement”) is entered into to be effective as of
________________, 2026 (the “Effective Date”), by and between the City of Mesa, an Arizona
municipal corporation (“City”) and OCAP Main St, LLC, an Arizona limited liability company
(“Licensee”). Each of City and Licensee may be referred to in this Agreement as a “Party,” or
collectively as the “Parties.”
A.
Licensee is the owner of the real property located at the northeast corner of E. Main
Street and N. Centennial Way in Mesa, Arizona, totaling approximately 32,496 square feet (the
“Property”).
B.
City is the owner of the three-story parking structure located at 20 N. Hibbert (the
“Garage”) on real property that is adjacent to the east side of the Property owned by Licensee.
C.
Pursuant to that certain Development Agreement between the Parties effective
___________, 2026, (the “Development Agreement”), generally regarding the development of a
hotel on the Property (the “Hotel”), Licensee is required to license from City one hundred (100)
parking spaces in the Garage for, among other reasons, the Hotel to satisfy Mesa City Code
development requirements.
D.
Additionally, as set forth in the Development Agreement, Developer desires and
intends to convey the Property and Minimum Improvements to City following Completion of
Construction of the Project (each as defined in the Development Agreement), lease the Property
and Minimum Improvements from City pursuant to A.R.S. §§ 42-6201, et seq., via a lease
agreement in the form attached to the Development Agreement to, among other things, abate the
government property lease excise tax (the “Lease”), and operate the Project in compliance with
the Development Agreement and Lease. Licensee is required to execute and deliver this
Agreement as a condition precedent to City having any obligation to enter into the Lease.
E.
City has agreed to grant to Licensee, and Licensee desires to receive from City, an
irrevocable (subject, however, to the terms of this Agreement), nonexclusive, non-delegable
license on, over, and across the Licensed Area (defined in Section 1(a)) by Licensee and its
permitted sublicensees for the parking of non-commercial automobiles and motorcycles (as more
fully defined as “Licensed Activities” in Section 1(c)).
AGREEMENT
Now, therefore, in consideration of the foregoing recitals and representations and the
mutual promises contained in this Agreement, the receipt and sufficiency of which are
acknowledged, the Parties agree as follows:
1.
Grant of License. City hereby grants to Licensee (and its permitted sublicensees)
an irrevocable (subject, however, to the terms of this Agreement), non-exclusive, non-delegable
license for parking in the Garage subject to all the following (the “License”):
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a.
The License is only upon, over, and across the one hundred (100) Spaces
(as defined below) within that portion of the Garage described and depicted on Exhibit A (the
“Licensed Area”).
b.
The Licensed Area may only be used by Licensee and Licensee’s permitted
sublicensees; such permitted sublicensees consist only of Hotel guests who are granted access to
the Garage by Licensee in connection with their stay at the Hotel, dining at the onsite restaurant at
the Hotel, or events at the Hotel, and Hotel employees and officers who are granted access to the
Garage by Licensee in connection with their shifts at the Hotel (each, a “Licensee Party” and
collectively, “Licensee Parties”).
c.
The Licensed Area may solely be used by Licensee and Licensee Parties for
the purpose of allowing, in connection with Licensee’s and Licensee Parties’ permitted use of the
Property, the parking of non-commercial automobiles, motorcycles, and light-duty trucks and vans
(collectively, the “Licensed Activities”) subject to the terms, conditions, and limitations set forth
in this Agreement and further subject to all rules and regulations of the City of Mesa respecting
use of the Garage (the “Rules and Regulations”). Licensed Activities expressly do not include,
and expressly exclude, the parking of any (1) commercial vehicle; (2) heavy-duty trucks or vans;
(3) trailers; (4) boats or jet skis or other item intended for nautical use; and (5) recreational vehicles
such as vehicles fitted for living accommodation and travel use, including motorhomes,
campervans, coaches, travel trailers, fifth-wheel trailers, popup campers, and truck campers. All
permitted vehicles parked in the Garage must be fully operational, and no repair or maintenance
of any vehicle in the Garage is permitted at any time. No vehicle may be parked or maintained in
the Garage as a form of advertising or promotion of a commercial enterprise. In addition, the
parking of non-commercial extended cab or extended bed trucks and vans that are owned and used
exclusively for personal use by Licensee or a Licensee Party may be restricted as to location within
the Garage by City. For the avoidance of doubt, Licensee is permitted to conduct, permit, and
allow only the Licensed Activities, only by Licensee and Licensee Parties, and only with respect
to the Licensed Area.
d.
The License includes a non-exclusive license for the use of Common Areas
in the Garage that are directly related to the use of the Licensed Spaces by Licensee or Licensee
Parties for Licensed Activities that are in accordance with the normal commercial uses of the
Garage. The “Common Areas” include the drive aisles, entrances, exits, elevators, and stairwells
of the Garage; all of the terms of this Agreement, including Licensee’s obligations related to the
Licensed Spaces, including the obligation to Indemnify (as that term is defined below), apply to
and include the Common Areas.
2.
Term of Agreement; Obligation to Pay License Fee. The term of this Agreement
(“Term”) is that period of time commencing on the Effective Date and terminating on the date
that is fifty (50) years later (“Termination Date”); provided however, this Agreement may be
earlier terminated by City in the event of a Default by Licensee in accordance with Section 11, or
in the event of a conflict of interest in accordance with Section 21. Licensee acknowledges and
agrees that this Agreement and the License Fee hereunder are a material part of the consideration
for City entering into the Development Agreement, an element of the conditions precedent to City
entering into the Lease, and the abatement of the government property lease excise tax in
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accordance with the Lease. Therefore, Licensee agrees that if this Agreement is terminated by
Licensee prior to the Termination Date or is terminated by City due to a Default by Licensee prior
to the Termination Date, Licensee must pay to City the cumulative total of the License Fee that
would have been paid to City for the period of time commencing on the date of the Notice of
termination and ending on the Termination Date. Such cumulative total of the License Fee (a) will
be determined by City based on the monthly parking rate per Licensed Space at the time of the
Notice of termination of this Agreement for one hundred (100) Spaces in the Garage extrapolated
over the remainder of the Term; and (b) must be paid to City within thirty (30) days of the Notice
of termination of this Agreement.
3.
Not a Lease; Encumbrances Prohibited. This Agreement constitutes a license with
respect to the Licensed Activities in the Licensed Area and is not a lease and does not convey or
grant an interest in real property. Licensee will not permit or allow to be placed any lien, charge,
or encumbrance of any nature on the Garage or any portion of the Licensed Area and will keep the
Licensed Area free and clear of all liens and encumbrances.
4.
Licensed Spaces.
a.
Parking in the Garage is permitted only in designated “striped” stalls or
spaces within the Garage for a single motor vehicle (each, a “Space” or collectively, “Spaces”).
Subject to (i) the payment in advance by Licensee of the License Fee; and (ii) Licensee’s
compliance with all other terms and conditions of this Agreement, parking by Licensee and
Licensee Parties is permitted pursuant to this Agreement in those Spaces within the Licensed Area
(each, a “Licensed Space”; or, if more than one, the “Licensed Spaces”).
b.
City may relocate the Licensed Area and the Licensed Spaces from time-to-
time upon reasonable notice to Licensee and as City may reasonably require, but not more than
once per calendar year.
c.
Licensee may sublicense the Licensed Spaces only to Licensee Parties; for
the avoidance of doubt, the only permitted sublicense of Licensed Spaces is to Licensee Parties.
Licensee may charge Licensee Parties a sublicense fee for each Licensed Space; for which City
has neither involvement nor responsibility. Licensee acknowledges that City is not in privity of
contract with any of Licensee Parties.
d.
Licensee is responsible, at its sole cost and expense, for all repair (including
replacement, as applicable) to the Garage resulting from damage by Licensee and Licensee Parties.
Upon Notice from City of an event of damage or destruction to the Garage by Licensee or a
Licensee Party, Licensee will promptly commence repair or replacement as required by City and
such repair or replacement will be subject to approval and supervision of City. City may
reasonably require the use of City’s approved contractor to complete any repair or replacement in
the Garage required by this section.
e.
City retains the right to use, occupy, assign, restrict, and otherwise deal with
all Spaces within the Garage except the Licensed Spaces while Licensee complies with this
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Agreement. Licensee acknowledges that the lower level of the Garage is restricted and Licensee
and Licensee Parties have no right to use any Spaces in the lower level of the Garage.
f.
Subject to City’s prior written approval with respect to (i) content; (ii)
placement; (iii) quality; (iv) method of adherence; and (v) any other condition reasonably imposed
by City, Licensee, at its sole cost and expense, may place signs within the Licensed Area, inter
alia, to assign Licensed Spaces to specific Licensee Parties, indicate location of and demark the
Licensed Area, and post reasonable rules and regulations for Licensee Parties.
5.
License Fee. Licensee must pay a monthly fee to City for the License on or prior
to the first (1st) day of each month of the Term (the “License Fee”) as set forth in this section.
Commencing on the Effective Date and continuing for eight (8) years, the License Fee will be ten
dollars ($10.00) per Licensed Space per month. Commencing on the first (1st) day of the ninth
(9th) year following the Effective Date, the License Fee will be (a) the amount of the then-current
Mesa City Council approved monthly parking rate per Space; (b) a License Fee other than the
Mesa City Council approved monthly parking rate per Space provided this Agreement is amended
to set such License Fee and the amendment is approved by the City Council at its sole and absolute
discretion; or (c) only if a Mesa City Council approved monthly parking rate per Space does not
exist, a commercially reasonable monthly rate for each Licensed Space (which will in no event be
less than the previously applicable monthly rate for the Licensed Spaces) that is mutually agreed
upon by the Parties. Licensee must make all payments required by and in accordance with this
section regardless of Licensee and Licensee Parties using less than all the Spaces within the
Licensed Area; stated another way, Licensee must pay to City the monthly License Fee for one
hundred (100) spaces for the fifty (50) year Term of this Agreement. Provided further, if Licensee
restripes Spaces in the Licensed Area or makes other changes to the Licensed Area in a manner
that results in less than one hundred (100) Spaces in the Licensed Area (such as to add Spaces to
the Licensed Area in order to comply with the Americans with Disabilities Act) (see Section 9),
the License Fee that Licensee must pay to City will still be calculated based on and as if Licensee
is licensing one hundred (100) Spaces in the Garage.
6.
Access and Security.
a.
Access. Licensee acknowledges and understands that the Garage is not
open to the public and is equipped with an access control system which allows only City authorized
personnel to enter the Garage by scanning a keycard or badge to open the gates and doors to the
Garage. Licensee will be responsible, at its sole cost and expense, for installing and maintaining
an access control system at the Garage to allow for and control access to the Garage by Licensee
and Licensee Parties. Licensee may issue keycards, badges, or other instrumentalities to Licensee
Parties for access to the Garage via Licensee’s access control system. City will not be responsible
for the access of Licensee or Licensee Parties to the Garage. Licensee is prohibited from installing
an access control system that in any way interferes with or limits access to the Garage by City or
City authorized personnel. Licensee must coordinate its design and installation of its access
control system with City and such improvements are subject to Section 9.
b.
Security. Licensee acknowledges and understands that City provides no
security at or for the Garage and agrees that City will have no obligation to provide security at the
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Garage. In the event that City elects, in its sole discretion, to provide security for the Garage, it
will do so solely for the benefit of City, and City’s employees and invitees; and Licensee agrees
and acknowledges that Licensee and Licensee Parties, and are not (and will not be) either intended
or unintended beneficiaries of such security measures and are not authorized to rely on such
security. Licensee is solely responsible, at its sole cost and expense, for: (i) the security for
Licensee and Licensee Parties and their employees, agents, contractors, and invitees at the Garage;
(ii) the security for the personal property (including all vehicles) of Licensee and Licensee Parties
and their employees, agents, contractors, and invitees, at the Garage; and (iii) the security of third
parties and users of the Garage to the extent such security-related events or incidents arise from or
are related to the use of the Garage by Licensee or Licensee Parties or their employees, agents,
contractors, or invitees. Licensee will ensure that Licensee and Licensee Parties and their
employees, agents, contractors, and invitees use the Property in a safe and secure manner and in
compliance with all applicable laws and the Rules and Regulations. City agrees Licensee, at its
sole cost and expense, may implement security measures at the Garage provided that Licensee
gives reasonable prior notice to City if such measures involve the installation of improvements at
the Garage; and further provided that no such security measures implemented by Licensee will
restrict or impair the right of City to use those portions of the Garage that are not subject to the
exclusive use granted to Licensee by this Agreement. In addition to, and without limiting any
other indemnity in this Agreement, Licensee will indemnify, defend, pay, and hold harmless City
Indemnified Parties (defined below) for, from, and against any and all claims or damages
(including injury and death to persons and loss of or damage to property) caused by, arising from,
or related to, in whole or in part, the acts or omissions of Licensee and Licensee Parties and their
employees, agents, contractors, and invitees for reason of their use of the Garage (or security at
the Garage, including adequacy of security, lack of security, and types of security installed).
7.
Insurance; Indemnity.
7.1.
Throughout the term of this Agreement, Licensee will procure and maintain,
at its sole cost and expense, insurance against claims for injuries to person or damages to property
which may arise from or in connection with the use by Licensee, Licensee Parties, or Licensee’s
tenants, subtenants, employees, agents, contractors, and invitees of the Licensed Area and Garage,
and the obligations set forth in the Agreement, including the repair and replacement obligations
and indemnity obligations of this Agreement. The terms and coverages for the insurance are as
set forth in Exhibit B to this Agreement.
7.2.
In addition, Licensee will pay, defend, indemnify, and hold harmless City
and its City Council members, officers, and employees (collectively, “City Indemnified Party(-
ies)”) from and against all claims, demands, fines, penalties, costs, expenses, damages, losses,
obligations, judgments, liabilities, and suits (including attorneys’ fees, experts’ fees and court costs
associated with such matters; all of the foregoing, collectively, “Claims”) imposed upon or
asserted against City, its agents, representatives, officers, directors, elected or appointed officials,
and employees, caused by, arising from, or related to, in whole or in part, the acts or omissions of
Licensee, Licensee Parties, and Licensee’s tenants, subtenants, employees, agents, contractors, and
invitees for reason of any of the following: (i) any act or omission by Licensee, Licensee Parties,
or Licensee’s tenants, subtenants, employees, agents, contractors, invitees, or representatives
undertaken in fulfillment of Licensee’s obligations under this Agreement; (ii) any use or nonuse
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of, or any condition created by Licensee, a Licensee Party, or Licensee’s tenant, subtenant,
employee, agent, contractor, invitee, or representative on or at the Garage or any part thereof; and
(iii) any accident, injury to or death of persons (including workmen), or loss of or damage to
property occurring on or about the Garage or any part thereof caused or created by, or arising from,
in whole or in part, any act or omission of Licensee, a Licensee Party, or Licensee’s tenant,
subtenant, employee, agent, contractor, invitee, or representative; except those Claims solely and
exclusively arising from or caused by the gross negligence or intentional misconduct of a City
Indemnified Party (collectively, “Indemnity”). Licensee’s obligations of Indemnity will survive
the expiration or earlier termination of this Agreement.
8.
Storage and Nuisances Prohibited. The Licensed Area may not be used for the
storage of vehicles, equipment, or materials. Licensee will not use the Licensed Area, nor permit
the Licensed Area to be used, in a manner that creates (or causes to be created) nuisances or hazards
to the public health or safety.
9.
Licensee’s Requested Improvements. To the extent that Licensee requests changes
to the Garage (by way of illustration, Licensee’s access control system required by Section 6,
separate entry for Licensee Parties, or structures to demark or limit access to the Licensed Area),
any such changes are subject to City’s prior approval, which may be granted, withheld, or
conditioned in City’s sole, absolute, and unfettered discretion, and which will be at Licensee’s sole
cost and expense. In addition, to the extent that Licensee’s use of the Garage by the Licensee
Parties for the Licensed Activities may require physical changes to the Garage by reason of the
Americans with Disabilities Act or other similar laws regulating access and accommodation (by
way of illustration, restriping of Spaces in the Licensed Area), all such changes will be at
Licensee’s sole cost and expense and are subject to Licensor’s prior approval, which may be
granted, withheld, or conditioned in Licensor’s sole, absolute, and unfettered discretion. If
Licensee restripes Spaces in the Licensed Area or makes other changes to the Licensed Area in a
manner that results in less than one hundred (100) Spaces in the Licensed Area (such as to add
Spaces to the Licensed Area in order to comply with the Americans with Disabilities Act), this
Agreement does not grant to Licensee, and Licensee will not be entitled to, a license to any
additional Spaces in the Garage outside of the Licensed Area; this Agreement only grants to
Licensee a license for the Licensed Area (which currently has one hundred (100) Spaces).
10.
Permits. Licensee will, at its sole cost and expense, obtain all permits, licenses, and
authorizations which may be required by City or any other governmental authorities with respect
to the Licensed Activities. Licensee will not engage in or permit any conduct in the Licensed Area
which violates any law, ordinance, permit, governmental regulation, the Rules and Regulations, or
which violates the terms of this Agreement.
11.
Default.
a.
Any breach by Licensee of any term or provision of this Agreement, after
Notice and opportunity to cure as more specifically set forth in this Agreement, is a “Default” by
Licensee of this Agreement.
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b.
If Licensee fails to pay any sum due under this Agreement promptly when
due and such failure continues for ten (10) days after Notice to Licensee, and such Default
continues for thirty (30) days after Notice to Licensee, City will have the right, at its election, to
terminate this Agreement and to seek any remedy available to City at law or in equity.
c.
If Licensee fails to perform or comply with any of the other agreements,
conditions, or undertakings of this Agreement that do not solely involve payment as described in
Section 11(b), and such Default continues for ninety (90) days after Notice to Licensee, City will
have the right, at its election, to terminate this Agreement and to seek any remedy available to City
at law or in equity.
d.
As long as the Development Agreement is in effect, a Default by Licensee
of this Agreement by Licensee will be a breach or default of the Development Agreement, and a
breach or default of the Development Agreement by Developer will be a Default of this
Agreement; and notice of such breach or default under the Development Agreement, sent to the
Developer named in, and in accordance with the “Notice” provisions of, the Development
Agreement, will, without further act or notice required, constitute Notice to Licensee of a Default
of this Agreement.
e.
As long as the Lease is in effect, a Default of this Agreement by Licensee
will be a breach or default of the Lease, and a breach or default of the Lease by Tenant will be a
Default of this Agreement; and notice of such breach or default under the Lease, sent to the Tenant
named in, and in accordance with the “Notice” provisions of, the Lease, will, without further act
or notice required, constitute Notice to Licensee of a Default of this Agreement.
f.
In addition to any other remedies available to City, during any period of
Default by Licensee, the License Fee will be increased by three hundred percent (300%) per Space.
g.
In addition to any other remedies of City with respect to a Default by
Licensee, Licensee acknowledges, on behalf of Licensee and all Licensee Parties, that (1) they are
subject to all applicable ordinances and codes of the City of Mesa, and all Rules and Regulations
applicable to a parking structure owned and operated by the City of Mesa; and (2) they may be
liable for any fines or penalties imposed by the City of Mesa for a violation by Licensee or a
Licensee Party of any applicable ordinance or code of the City of Mesa, or any Rule and Regulation
applicable to a parking structure owned and operated by the City of Mesa.
h.
If Licensee receives Notice of a violation by Licensee or a Licensee Party
of this Agreement or the Rules and Regulations, Licensee must promptly cure or remedy such
violation at Licensee’s sole cost and expense within not fewer than seventy-two (72) hours, which
cure or remedy may include towing (and subsequent storage) of any vehicle in violation of this
Agreement or the Rules and Regulations. The failure of Licensee to timely and promptly comply
with this Section 11(h) is a Default by Licensee.
12.
Attorneys’ Fees. In the event of any litigation or other legal proceedings between
the Parties, the prevailing Party as determined by the court, will be entitled to the payment by the
non-prevailing Party of its reasonable attorneys’ fees, court costs, and litigation expenses, as
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determined by the court. In no event will City or Licensee (or their respective successors or
permitted assigns) be liable for any special, consequential, incidental, punitive, or exemplary
damages.
13.
No Partnership; Assignment. It is not intended by this Agreement to, and nothing
contained in this Agreement will, create any partnership, joint venture, landlord-tenant, or similar
arrangement between the Parties, other than that of City and Licensee. No term or provision of
this Agreement is intended to, or will, be for the benefit of any person, firm, organization, or
corporation not a party to, and no such other person, firm, organization, or corporation will have
any right or cause of action hereunder. Other than in connection with a permitted transfer under
the Development Agreement and the Lease of Licensee’s entire leasehold interest in the Property,
and an express assumption by an assignee of all of Licensee’s obligations under this Agreement,
Licensee may not assign its rights under this Agreement or grant to any other person the right to
utilize the Licensed Area (other than Licensee Parties) without the prior written consent of City,
which consent City may grant or withhold in its sole discretion.
14.
Descriptive Headings. The captions used in this Agreement are for reference only
and are not to be construed as a part of this Agreement.
15.
Applicable Law. This Agreement will be governed by, and construed in accordance
with, the substantive laws of the State of Arizona without giving any effect to the principles of
conflicts of law.
16.
Incorporation of Recitals and Exhibits; Certain Terms; Entire Agreement. Each of
the recitals set forth above and each of the exhibits attached hereto are hereby incorporated into
this Agreement and made a part hereof. Subject in all events to Licensee’s obligations under the
Development Agreement and Lease, this Agreement constitutes the entire Agreement between
City and Licensee pertaining to the use of the Licensed Area and the grant of the License and
supersedes all prior agreements, understandings, and representations with respect thereto. This
Agreement may not be modified, amended, supplemented, or otherwise changed except by a
writing executed by both City and Licensee. Licensee agrees, acknowledges, and understands that
certain amendments to this Agreement may require the approval of the City Council acting in its
sole discretion. “Including” and “includes” in this Agreement mean “including but not limited to.”
17.
Counterparts. This Agreement may be executed in any number of counterparts, all
of which taken together will constitute one in the same instrument.
18.
Severability. If any term, provision, or covenant contained in this Agreement will,
to any extent, be invalid or unenforceable, the remainder of this Agreement will not be affected
thereby, and each term, provision, and condition hereof will be valid and enforceable to the fullest
extent permitted by law.
19.
Notices. All notices, demands, requests, consents, approvals, and other
communications required or permitted in this Agreement (each, a “Notice”), must be in writing
and will be deemed to have been given upon personal delivery to the respective Party, after
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delivery by personal service or a nationally recognized overnight courier service (e.g., UPS,
Federal Express) for next business day delivery, at the Party’s address shown below:
To Licensee:
Breakwell Group LLC
Attn: Blake Bunker
3626 East Sagebrush Street
Gilbert, Arizona 85296
With a copy to:
Huber Barney PLLC
Attn: Aaron Huber
4915 East Baseline Road, Suite 105
Gilbert, Arizona 85234
If to City:
City of Mesa
Attn: City Manager
20 East Main Street
Mesa, Arizona 85211
and
City of Mesa
Attn: Manager of Urban Transformation
20 East Main Street
Mesa, Arizona 85211
With a copy to:
City of Mesa
Attn: City Attorney
20 East Main Street, Suite 850
Mesa, Arizona 85201
or at such other address as either Party may from time to time designate in writing to the other.
20.
No Recordation. The Parties agree that this Agreement may not be recorded in the
Official Records of Maricopa County, Arizona, and the recordation of this Agreement by either
Party will be a Default by such Party.
21.
Conflict of Interest Statute. This Agreement is subject to, and may be terminated
by City in accordance with, the provisions of A.R.S. §38-511.
22.
No Boycott of Israel. Licensee certifies pursuant to A.R.S. §35-393.01 that it is not
currently engaged in, and for the duration of this Agreement will not engage in, a boycott of Israel.
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IN WITNESS WHEREOF, City and Licensee have executed this Agreement as of the date
first written above.
“CITY”
CITY OF MESA, ARIZONA,
an Arizona municipal corporation
_______________________________
By:
Scott Butler
Its:
City Manager
Date: _________________________
“LICENSEE”
____________________________________
By:
______________________________
Its:
______________________________
Date: ______________________________
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EXHIBIT A TO PARKING LICENSE AGREEMENT
Description and Depiction of Licensed Area
[Insert Description and Depiction]
The Garage has ____ spaces on levels 1 through ___. Licensee is licensed one hundred (100)
spaces which will be located on levels _______
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EXHIBIT B TO PARKING LICENSE AGREEMENT
Insurance Requirements
Licensee will procure and maintain insurance during the applicable “Coverage Period,” as
shown on the below chart, against claims for injury to persons or damage to property which may
arise from or in connection with the Garage and/or in the performance of work or construction of
the Garage by Licensee, its agents, representatives, employees, contractors, or subcontractors.
The insurance requirements herein are minimum requirements for the Agreement, of which
this exhibit is a part (the “License”), and in no way limits the indemnity covenants contained in
the License. City in no way warrants that the minimum limits contained herein are sufficient to
protect Licensee from liabilities that might arise from or in connection with the Garage, and
Licensee is free to purchase additional insurance as Licensee may determine.
A.
MINIMUM SCOPE AND LIMITS OF INSURANCE: Licensee will provide coverage
during the Coverage Period and with limits of liability not less than those stated below.
Type
Amount
Coverage Period
General Liability (which will
include operations, products,
completed operations, and
contractual liability coverage)
With limits not less than
$3,000,000 combined single
limit per occurrence and not
less than $5,000,000 general
aggregate.
Coverage will be in effect
upon or prior to and remain in
effect for the Term of the
License.
Property (all risks of loss
including risks covered by
fire and extended coverage,
terrorism, vandalism, and
malicious mischief)
In an amount not less than
full replacement cost of
structure and all fixtures.
Coverage will be in effect
upon or prior to the earlier of
when the Builder’s Risk
policy is no longer in effect
or substantial completion of
construction and thereafter
remain in effect for the Term
of the License.
Commercial Automobile
Liability
With limits not less than
$1,000,000 each occurrence,
Combined Single Limit for
bodily injury and property
damage covering owned,
non-owned and hired auto
coverage as applicable.
Coverage will be in effect
upon or prior to and remain in
effect for the Term of the
License.
Business Interruption
Coverage (can be endorsed to
the Property policy)
Minimum 12 months’ rent
and ongoing operating
expenses
Coverage will be in effect
upon or prior to the earlier of
when the Builder’s Risk
policy is no longer in effect
or substantial completion of
construction and thereafter
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remain in effect for the Term
of the License.
Workers’ Compensation
Employers’ Liability
Statutory Limits
$500,000 each accident, each
employee
Coverage will be in effect
upon or prior to and remain in
effect for the Term of the
License.
Liquor Liability
$5,000,000
Coverage will be in effect
upon or prior to and remain in
effect for the Term of the
License, provided Licensee
sells and/or serves alcohol.
Builder’s Risk
In an amount not less than the
estimated total cost of
construction.
Coverage will be in effect
upon or prior to any
construction activities and
maintained until the
substantial completion of
construction.
Owner’s and Contractor’s
Protective Liability
$5,000,000
Coverage will be in effect
upon or prior to any
construction activities and
maintained until the
substantial completion of
construction.
Professional Liability
$2,000,000
Coverage will be in effect
upon or prior to any
construction activities and
maintained until the
substantial completion of
construction.
Blanket Crime Policy
$5,000,000
Coverage will be in effect
upon or prior to and remain in
effect for the Term of the
License.
B.
ADDITIONAL INSURANCE REQUIREMENTS: The policies will include, or be
endorsed to include, provisions with the following effect:
1.
City, and its agents, officials, volunteers, officers, elected officials, and employees,
will be named as additional insureds and added by endorsements on all general liability insurance
policies and commercial automotive liability policies.
2.
On insurance policies where the City is to be named as an additional insured, the
City will be named as additional insured to the full limits and to the same extent of coverage as
the insurance purchased by Licensee, even if those limits of coverage are in excess of those
required by the License.
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3.
The Licensee’s insurance coverage will be primary and non-contributory with
respect to all other City insurance sources.
4.
All policies will include a waiver of subrogation rights in favor of the City, its
agents, officials, volunteers, officers, elected officials, and employees. Licensee will obtain a
workers’ compensation policy that is endorsed with a waiver of subrogation in favor of City for
all work performed by Licensee, its employees, agents, contractors and subcontractors. Licensee
agrees to obtain any endorsement that may be necessary to comply with this waiver of subrogation
requirement.
5.
All general liability policies will include coverage for explosion, collapse,
underground work, and contractual liability coverage, which will include (but is not limited to)
coverage for Licensee’s indemnification obligations under the License.
6.
City will be named as Loss Payee on all property insurance policies. Proceeds of
any property damage insurance will be applied as required by Section 17 of the Lease.
C.
EXCESS OR UMBRELLA POLICY: In addition to a primary policy, an excess or
umbrella policy may be used to meet the minimum requirements if the excess or umbrella coverage
is written on a “following form” basis.
D.
NOTICE OF CANCELLATION: Each insurance policy will include provisions to the
effect that it will not be suspended, voided, cancelled, or reduced in coverage except after thirty
(30) days’ prior written notice has been given to City. Such notice will be sent directly to Risk
Management, City Attorney’s Office, City of Mesa, 20 E. Main Street, P.O. Box 1466, MS-1077,
Mesa, Arizona 85211.1466.
E.
ACCEPTABILITY OF INSURERS: Insurance is to be placed with insurers duly licensed
or authorized to do business in the State of Arizona and with an “A.M. Best” rating of not less than
A- VII. City in no way warrants that the above-required minimum insurer rating is sufficient to
protect the Licensee from potential insurer insolvency.
F.
ENDORSEMENTS AND VERIFICATION OF COVERAGE: Licensee will provide City
with Certificates of Insurance signed by the Issuer with applicable endorsements for all policies as
required herein. All Certificates of Insurance and any required endorsements are to be received
and approved by the City before the applicable Coverage Period. Each applicable insurance policy
required by the License must be in effect at or prior to and remain in effect for the Coverage Period.
All Certificates of Insurance and endorsements will be sent directly to the City Attorney, City
Attorney’s Office, City of Mesa, 20 E. Main Street, P.O. Box 1466, MS-1077, Mesa, Arizona
85211-1466. City reserves the right to require complete copies of all insurance policies required
by the License at any time, but not more than once each twelve consecutive months during the
Term of the License.
G.
LICENSEE’S DEDUCTIBLES AND SELF-INSURED RETENTIONS: Any deductibles
or self-insured retention in excess of $250,000 will be declared to and be subject to approval by
City. Licensee will be solely responsible for the payment of any deductible or self-insured amounts
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and waives any rights it may have to seek recovery of such amounts from City and its agents,
officials, volunteers, officers, elected officials, and employees.
H.
LICENSEE’S CONTRACTORS AND DESIGN PROFESSIONALS: Licensee will
require and verify that the general contractor and all subcontractors maintain reasonable and
adequate insurance with respect to any work on or at the Garage, all such policies will include: (i)
a waiver of subrogation rights in favor of the City, its agents, officials, volunteers, officers, elected
officials, and employees, (ii) a waiver of liability in favor of the City, its agents, officials,
volunteers, officers, elected officials, and employees releasing and holding harmless the same from
any and all liability for any and all bodily injury, including death, and loss of or damage to
property, and (iii) City, and its agents, officials, volunteers, officers, elected officials, and
employees, will be named as additional insureds and added by endorsements on all general liability
insurance policies and commercial automotive liability policies. Licensee will require all design
professionals (e.g., architects, engineers) to obtain Professional Liability Insurance with limits of
liability not less than those stated in the above chart.
I.
CITY’S RIGHT TO ADJUST. With written notice to Licensee of not less than 60 days,
City may reasonably adjust the amount and type of insurance Licensee is required to obtain and
maintain under this Agreement as reasonably required by City from time-to-time.
J.
FAILURE TO PROCURE. If Licensee fails to procure or maintain any insurance required
hereunder, City may, but is not required to, procure and maintain any or all of the insurance
required of Licensee under this Agreement. In such event, all costs of such insurance procured
and maintained by City will be the responsibility of Licensee and will be fully reimbursed to City
within ten (10) business days after City’s request payment thereof.