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INTERGOVERNMENTAL AGREEMENT BETWEEN THE CITY OF CHANDLER, ARIZONA AND THE CITY OF PHOENIX, ARIZONA TO ESTABLISH RINCHEM COMPANY INC. WITHIN FOREIGN TRADE ZONE This Intergovernmental Agreement is entered into this day of , 2022 by and between the City of Chandler, Arizona, a municipal corporation (“Chandler”) and the City of Phoenix, Arizona, a municipal corporation (“Phoenix”). I. RECITALS: A. Pursuant to A.R.S. §11-952, as amended, Chandler is empowered to enter into this intergovernmental agreement and has, by resolution, a copy of which is attached hereto as Exhibit A and incorporated herein by this reference, authorized the undersigned to execute this Agreement on behalf of Chandler. B. Pursuant to A.R.S. §11-952, as amended, Phoenix is empowered to enter into this intergovernmental agreement and has, by ordinance, a copy of which is attached hereto as Exhibit B and incorporated herein by this reference, authorized the undersigned to execute this Agreement on behalf of Phoenix. Cc. Phoenix has received a Grant (Board Order 185, dated March 25, 1982) from the Foreign-Trade Zones Board (the “Board”) to establish FTZ No. 75, and the alternative site framework format for FTZ No. 75 was approved by the Board in a notice published on October 20, 2010 in 75 Fed. Reg. 64708. Dz Chandler does not have a grant of authority to establish a Foreign-Trade Zone. E, Rinchem Company Inc. (“Rinchem”) operates a distribution facility on certain real property within the City of Chandler located at 6805 W. Morelos Place (the “Site””) and desires to have the Site designated as a subzone (the “Zone Site”). The Site, is legally described on Exhibit C attached hereto, is utilized as a distribution facility. Rinchem seeks the benefit of import/export duty reduction afforded businesses located within the FTZ. Rinchem agrees not to pursue or claim the beneficial tax treatment for existing or new facilities located on the Site as afforded by Arizona law. EF. Chandler desires to assist Rinchem in obtaining approval from the Board to establish, operate and maintain a subzone site at the Zone Site. G. Phoenix is willing to submit an application to the Board on behalf of Rinchem (the “Application’”) for a minor boundary modification to establish, operate and maintain a subzone at the Zone Site to demonstrate its interest in a cooperative regional effort to encourage the retention and expansion of business in the greater metropolitan area. NOW, THEREFORE, in consideration of the promises and mutual agreements contained and described herein, the parties agree as follows: IL. AGREEMENTS: 1. PURPOSE 1.1 The purpose of this Agreement is to memorialize Chandler’s and Phoenix’s agreement to work together to assist Rinchem in its efforts to obtain subzone status for the Zone Site and to assure Phoenix that the establishment, operation and maintenance of a subzone status at the Zone Site, including any unsuccessful efforts made in respect thereto, shall be accomplished without any cost or liability whatsoever to Chandler or Phoenix. 2. CHANDLER’S RESPONSIBILITIES 2.1 To facilitate the negotiation and execution of a Foreign-Trade Zone Operations Agreement (“Operating Agreement”), if any, between the City of Phoenix and Rinchem. 2.2 To support the Application process. 2.3. To notify Phoenix if Chandler desires that Phoenix enforce its right to terminate the Operating Agreement, after notice and a 30-day cure period, if Rinchem, without prior approval of Chandler, in breach of the Operating Agreement, either seeks and/or obtains property tax classification under Arizona Revised Statutes § 42-12006(2) for real or personal property at the Zone Site. 2.4 To take all action requested by Phoenix related to the enforcement of the provisions referred to in Section 2.3, above, and to indemnify, defend and hold Phoenix, its departments, agents, officers or employees harmless from and against any loss, expense, damage or claim resulting from or arising out of the performance or enforcement of the provision in the Operating Agreement required under Section 3.4 below. 3. PHOENIX’S RESPONSIBILITIES 3.1 To conduct its operations in good faith with Rinchem. 3.2 After filing the Application for the Site, to enter into an Operating Agreement with Rinchem for the operation of the Zone Site. 3.3. To provide in the Operating Agreement that Rinchem must be responsible for all costs related to the Zone Site that are incurred by Phoenix and/or Chandler. 3.4 To provide in the Operating Agreement that Phoenix may terminate the Operating Agreement if Phoenix is advised by Chandler that Rinchem has sought and/or obtained property ’ tax classification under A.R.S. § 42-12006(A)(2). 4. ADDITIONAL AGREEMENTS 4.1 The Parties acknowledge that 15 C.F.R §400.49 provides for monitoring and reviews of foreign trade zone operations and activity. Section 400.49(c) provides that the Board or the Commerce Department’s Assistant Secretary for Import Administration may restrict or prohibit zone activity that it finds is no longer in the public interest and, pursuant to 14 C.F.R. § 400.61, the Board has the authority to revoke a grant of authority to operate a zone, for cause. 4.2 Chandler and Rinchem have determined that if Rinchem seeks and obtains property tax classification under the Reclassification Statute in breach of the FTZ Agreement, such action would be detrimental to the public interest. Ds INDEMNIFICATION 5.1 To the extent permitted by law, each party will indemnify and save the other party harmless, including any of the parties’ departments, agencies, officers, employees, elected officials or agents, from and against all loss, expense, damage or claim of any nature whatsoever which is caused by any activity, condition or event arising out of the performance or non- performance by the indemnifying party of any of the provisions of this Agreement. 5.2 Each party, in all instances, shall be indemnified against all liability, losses and damages of any nature for or on account of any injuries or death of persons or damages to or destruction of property arising out of or in any way connected with the performance or non- performance of this Agreement by the other party, except such injury or damage as shall have been occasioned by the negligence of that other party. The damages incurred by the other party, their department, agencies, officers, employees, elected officers or agents shall include in the event of any action, court costs, expenses for litigation and reasonable attorneys’ fees. 6. DURATION 6.1 Term. The term of this Agreement shall begin on the date executed and approved by both parties and shall remain in effect for the same term as the Operating Agreement, unless terminated sooner pursuant to the terms of this Agreement. 7. GENERAL PROVISIONS 7A Conflict of Interest. This Agreement is subject to cancellation pursuant to the provisions of A.R.S. § 38-511. 7.2 Immigration Law Compliance Warranty. As required by A.R.S. § 41-4401, each party hereby warrants its compliance with all federal immigration laws and regulations that relate to its employees and A.R.S. § 23-214(A). Each party further warrants that after hiring an employee, it verifies the employment eligibility of the employee through the E-Verify program. If either party uses any subcontractors in performance of the Agreement, subcontractors shall warrant their compliance with all federal immigration laws and regulations that relate to its employees and A.R.S. § 23-214(A), and subcontractors shall further warrant that after hiring an employee, such subcontractor verifies the employment eligibility of the employee through the E- Verify program. A breach of this warranty shall be deemed a material breach of the Agreement subject to penalties up to and including termination. A party shall not be deemed in material breach if it and/or its subcontractors establish compliance with the employment verification provisions of Sections 274A and 274B of the federal Immigration and Nationality Act and the E-Verify requirements contained in A.R.S. § 23-214(A). Each party retains the legal right to inspect the papers of the other party and/or its subcontractor engaged in performance of this Agreement to ensure that the other party and/or its subcontractor is complying with the warranty. Any inspection will be conducted after reasonable notice and at reasonable times. If state law is amended, the parties may modify this paragraph consistent with state law. 7.3 Notices. All notices, demands and communications given or to be given, by either party to the other, shall be given in writing, by certified mail, and shall be addressed to the parties at the addresses hereinafter set forth, or at such other address as the parties may by written notice hereafter designate. All notices shall be deemed received upon actual receipt or three (3) business days after deposit in the United States mail, whichever date is earlier. Notices shall be addressed as follows: Phoenix: Director ; Community and Economic Development Department 200 West Washington Street, 20" Floor Phoenix, Arizona 85003-1611 and City Clerk City of Phoenix 200 West Washington Street, 15" Floor Phoenix, Arizona 85003-1611 Chandler: City Manager City of Chandler P.O. Box 4008, Mail Stop 605 Chandler, Arizona 85244-4008 and Chandler City Attorney’s Office P.O. Box 4008, Mail Stop 602 Chandler, Arizona 85244-4008 Attention: City Attorney 7.4 Construction. Paragraph headings and captions appearing with this Agreement are for convenient reference only and in no respect define, limit or describe the scope or intent of this Agreement or the provisions of such sections. 7.5 Binding Effect. All terms, provisions and conditions hereof shall be binding upon and inure to the benefit of all parties hereto and their respective heirs, personal representatives, successors and assigns. 7.6 Severability. In the event any term or provision of this Agreement is held to be invalid or unenforceable, the validity of the other provisions shall not be affected, and the Agreement shall be construed and enforced as if it did not contain the particular term or provision that is deemed to be invalid or unenforceable. 7.7 Governing Law. This Agreement will be governed by the laws of the State of Arizona, both as to interpretation and performance. 7.8 Modification. This Agreement may be modified only by mutual written agreement of the parties. [signature page follows] IN WITNESS WHEREOF, the parties have executed this Agreement on the date first written above. FOR CHANDLER: By: Kevin Hartke FOR PHOENIX: JEFF BARTON, CITY MANAGER By: Christine Mackay Its: Mayor Its: Community and Economic Development Director Date: Date: ATTEST: City Clerk ATTORNEY DETERMINATION In accordance with the requirements of A.R.S. § 11-952(D), each of the undersigned attorneys acknowledge that (1) they have reviewed the above Agreement on behalf of their respective client(s) and (2) as to their respective client(s) only, each attorney has determined that this Agreement is in proper form and is within the powers and authority granted under the laws of the State of Arizona. Ow) City Attorney, City of Chandler q City Attorney, City of Phoenix Date: Date: Draft IGA Chandler Rinchem FTZ Dated 2-24-2022 (scrubbed) Exhibit A [INSERT CHANDLER RESOLUTION] Exhibit B [INSERT PHOENIX RESOLUTION] follows: RESOLUTION 21870 A RESOLUTION AUTHORIZING THE CITY MANAGER TO SUBMIT ALL FUTURE APPLICATIONS TO THE FOREIGN- TRADE ZONE BOARD OF THE U.S. DEPARTMENT OF COMMERCE TO STREAMLINE THE FOREIGN-TRADE ZONE APPLICATION PROCESS AND PROVIDE A MORE EFFICIENT DELIVERY OF SERVICE FOR APPLICANTS NOT REQUESTING PROPERTY TAX RECLASSIFICATION FOR FOREIGN-TRADE ZONE PROPERTY LOCATED WITHIN THE CITY OF PHOENIX; FURTHER AUTHORIZING TO ENTER INTO FOREIGN-TRADE ZONE OPERATIONS AGREEMENTS AND ANY OTHER NECESSARY DOCUMENTATION WITH FURTURE APPLICANTS; AND FURTHER AUTHORIZING THE CITY TREASURER TO ACCEPT FUNDS. BE IT RESOLVED BY THE COUNCIL OF THE CITY OF PHOENIX as SECTION 1. That the City Manager or his designee is hereby authorized on behalf of the City of Phoenix, as Grantee of Foreign Trade Zone (FTZ) No. 75, to submit all future applications to the Foreign-Trade Zone Board of the U.S. Department of Commerce to streamline the FTZ application process and provide a more efficient delivery of service for applicants not requesting property tax reclassification for FITZ property located within the City of Phoenix. If property tax reclassification for activated FTZ pursuant to Arizona law (A.R.S. 42-12006) is requested for any site within the City of Phoenix boundaries, a request will be placed on a City Council meeting agenda for consideration and authorization. Each new contract term will be 20 years unless the FTZ designation terminates sooner. SECTION 2. That the City Manager or his designee is hereby authorized to enter into a FTZ Operations Agreement (Agreement), and any other necessary agreements or documents with future applicants. SECTION 3. The City Treasurer is authorized to accept funds for the purposes of this Ordinance. PASSED by the Council of the City of Phoenix this 21st day of October, 2020. ATTEST: yw Ashe Denige Archibéld! City Clerk APPROVED AS TO FORM: Cris Meyer, City Attorney py. Julie Kriegh(Dct 16, 2020 19:41 PDT) Julie Kriegh, Chief Assistant City Attorney DRE REVIEWED BY: Ed Zue(6er, City Manager DRL:rb:LF 20-2376: 10/21/20:2214952_1 2 Resolution 21870 Exhibit C [INSERT LEGAL DESCRIPTION]