HomeMy WebLinkAboutContract 28336-A2 I
CITY RACTEVp X33 -
STATE OF TEXAS §
§ KNOW ALL PERSONS BY THESE PRESENTS:
COUNTIES OF TARRANT,DENTON §
AND WISE §
SECOND AMENDMENT TO THE AGREEMENT TO LEASE AND OPERATE
SOUTHEAST LANDFILL BY AND BETWEEN THE CITY OF FORT WORTH, TEXAS,
AS LESSOR AND ALLIED WASTE SYSTEMS,INC. d/b/a TRINITY WASTE SERVICES,
AS LESSEE
This "SECOND AMENDMENT TO THE AGREEMENT TO LEASE AND
OPERATE SOUTHEAST LANDFILL BY AND BETWEEN THE CITY OF FORT
WORTH, TEXAS, AS LESSOR AND ALLIED WASTE SYSTEMS, INC. d/b/a TRINITY
WASTE SERVICES, AS LESSEE" (this "Amendment") is entered into as of the I*'`day
of DQr—. , 2009, by and between THE CITY OF FORT WORTH, TEXAS, a home rule
municipal corporation in Tarrant County, Texas, acting herein by and through its Assistant City
Manager, Fernando Costa ("City"), and ALLIED WASTE SYSTEMS, INC., d/b/a/ TRINITY
WASTE SERVICES, a Delaware corporation duly authorized to do business in the State of Texas,
acting by and through its duly authorized representative("Lessee").
WITNESSETH:
WHEREAS, the City and Lessee entered into a certain"AGREEMENT TO LEASE AND
OPERATE SOUTHEAST LANDFILL" known as City Secretary Contract No. 28336, (the
"Original Agreement"), dated January 28, 2003, for the lease of the City's Southeast Landfill,
pursuant to the terms of that certain RFP 02-0087 (the"RFP"), issued by the City; and
WHEREAS, the City and Lessee then entered into a certain First Amendment to the
Original Agreement known as City Secretary Contract No. 32407, ("First Amendment") on or about
September 25, 2005, to adjust the Minimum Annual Variable Rent schedule and make certain other
changes;
WHEREAS, the Original Agreement as amended by the First Amendment is herein called
the "Existing Agreement," to which reference is here made for all purposes and as fully as if set
forth in full herein;
WHEREAS, on or about August 13, 2008, Lessee filed a lawsuit in the 153rd District Court
of Tarrant County, Texas against the City for certain claims related to the Agreement;
WHEREAS, Republic Services, Inc. purchased Lessee and has agreed to be a guarantor of
Lessee's performance under the Agreement;
WHEREAS, the parties wish to settle the lawsuit prior its trial date s,-t_Fnr Tnnnnrr
2010• and
' OFFICIAL RECORD
'CITY SECRETARY
VT
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WHEREAS, in connection with settling the lawsuit, the parties desire to amend the Existing
Agreement and revise the Minimum Annual Variable Rent and make certain other changes as more
particularly set forth below.
NOW, THEREFORE, for and in consideration of the mutual covenants contained herein,
and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged and confessed,the City and Lessee agree as follows:
A. Amendments of Existing Agreement as of January 1, 2010: The Existing
Agreement is hereby amended by the following amendments which will be and become effective on
and as of January 1, 2010,to-wit:
1. Definitions. Section 1.01 of the Existing Agreement is amended by:
(a) Deleting the definition of"Carryforward Credit" from
such Section.
(b) Amending and restating in its entirety the definition of
"Minimum Annual Variable Rent" as presently set forth in such
Section to read as follows:
"Minimum Annual Variable Rent" means $2,100,000 per Operating
Year, adjusted by the Adjustment Factor for each Operating Year
after 2012 as described in Section 4.04(C)."
(c) Amending and restating in its entirety the definition of
"Operating Year" as presently set forth in such Section to read as
follows:
"Operating Year" means a calendar year commencing on January 1,
2010, or any succeeding anniversary thereof."
(c) Adding the following additional definitions in such
Section:
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common
control with such Person. As used herein, the term "control" means
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person by virtue of
ownership or control of voting securities or equity interests.
"Agreed Per-Ton Charge" has the meaning set forth in Section
4.04(D).
"Deemed Company Waste Revenue" has the meaning set forth in
Section 4.04(D).
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"Increased Fees and Taxes Amount" has the meaning set forth in
Section 4.04(D).
"Maximum City Gate Rate"has the meaning set forth in Section 8.03.
"Net Non-Company Waste Revenue" has the meaning set forth in
Section 4.04(D).
"Non-City Company Waste" means Non-City Waste that is delivered
to the Southeast Landfill by or for Lessee or any Affiliate of Lessee.
"Non-City Non-Company Waste" means all Non-City Waste other
than Non-City Company Waste.
"Non-City Waste Revenue" has the meaning set forth in Section
4.04(D).
"Posted Gate Rate"has the meaning set forth in Section 8.03.
2. Initial Term. Section 3.01 of the Existing Agreement(which was amended in the
First Amendment)is amended and restated in its entirety to read as follows:
"SECTION 3.01. Initial Term. The initial term of this Agreement
(the "Initial Term") shall commence on the Contract Date and shall
expire on the earlier of (i) midnight on December 31, 2033 (the
"Anticipated Term End," being the day before the twenty-fourth
(24th) anniversary of January 1, 2010), (ii) the last day of the Useful
Life of the Southeast Landfill, and (iii) the date this Agreement is
terminated pursuant to Article XIV or otherwise as permitted herein."
3. Adjustment Factor. Section 4.03 of the Existing Agreement is amended by
deleting the following provisions from the definition of the Adjustment Factor contained in such
Section:
"In this example, the prior year's Base Rent and Variable Rent per
ton, assuming a Base Rent of$500,000 and a Variable Rent per Ton
of$9.63 would increase as follows:
Base Rent: $500,000 X 1.03115 = $515,575.00
Variable Rent(per Ton of Non-City Waste): $9.63 X 1.03115
= $9.929 or$9.93 (after rounding)
Base Rent will be rounded up or down to the nearest whole number.
Variable Rent (per Ton of Non-City Waste) will be rounded up or
down to the nearest$0.01."
and by inserting the following provisions in lieu of such deleted provisions:
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"In this example, the prior year's Base Rent, assuming a Base Rent of
$500,000,would increase as follows:
Base Rent: $500,000 X 1.03115 = $515,575.00
Base Rent will be rounded up or down to the nearest whole number.
As used hereinabove, the term"Index Year"means the twelve months
period ending on September 30. Thus, for example, the Index Year
preceding the 2010 Operating Year is the twelve month period ending
September 30, 2009, and the Index Year two years preceding the 2010
Operating Year is the twelve month period ending September 30,
2008."
4. Minimum Annual Variable Rent. The parties agree that this Second Amendment
shall eliminate the Minimum Annual Variable Rent Schedule as described in Section 4.04(D) of the
Original Agreement and as later amended in the First Amendment, effective as of January 1, 2010.
Sections 4.04(C), 4.04(D) (as amended by the First Amendment), 4.04(E), 4.04(F), 4.04(G),
4.04(H) (as amended by the First Amendment), 4.04(I) and 4.04(J) of the Existing Agreement, and
Paragraph 1 of the First Amendment are deleted and Sections 4.04(C), (D), (E), (F), (G), (H), (I),
and (J) of the Existing Agreement shall now be amended to be as follows:
"(C) Minimum Annual Variable Rent. During each
Operating Year beginning with the Operating Year commencing on
January 1, 2010, Lessee shall pay the City "Minimum Annual
Variable Rent" calculated as hereinafter provided. For each of the
2010, 2011, and 2012 Operating Years the "Minimum Annual
Variable Rent" shall be $2,100,000. For each Operating Year after
the 2012 Operating Year, the Minimum Annual Variable Rent shall
be an amount equal to the Minimum Annual Variable Rent payable
for the preceding Operating Year, multiplied by the Adjustment
Factor as set forth in Section 4.03; provided that the Minimum
Annual Variable Rent shall never be adjusted to be less than the
previous Operating Year's Minimum Annual Variable Rent.
Minimum Annual Variable Rent for each Operating Year shall be
paid in equal monthly installments, which shall be due and payable on
or before the 20th day of each month.
(D) Additional Annual Variable Rent. Within ten days
after the end of each Operating Year beginning with the Operating
Year that commences on January 1, 2010, Lessee shall provide the
City a written accounting to determine whether any additional Annual
Variable Rent is due for such Operating Year. For this purpose, the
Variable Rent for an Operating Year shall be calculated as 22% of the
"Non-City Waste Revenue" for such Operating Year as defined
below. If the Variable Rent for an Operating Year calculated in this
manner exceeds the Minimum Annual Variable Rent as calculated for
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that Operating Year, Lessee will pay the amount of such excess to the
City on or before the 20th day after the end of such Operating Year.
The "Non-City Waste Revenue" for an Operating Year shall be an
amount equal to the greater of:
(1) $23.51 multiplied times the total Tons of Non-City Waste
delivered to the Southeast Landfill during the Operating Year; or
(2) the sum of (i) the "Net Non-Company Waste Revenue" for the
Operating Year calculated as provided below, plus (ii) the "Deemed
Company Waste Revenue" for the Operating Year calculated as
provided below.
The "Net Non-Company Waste Revenue" for an Operating Year shall
be an amount equal to (i) the total tipping fees or charges charged for
all Non-City Non-Company Waste delivered to the Southeast Landfill
during the Operating Year, minus (ii) the "Increased Fees and Taxes
Amount," if any, for such Operating Year calculated as provided
below.
The "Increased Fees and Taxes Amount" (if any) for an Operating
Year shall be an amount equal to the excess, if any, of(i)the total fees
and/or taxes required by Applicable Law to be paid, or charged to
generators or disposers of waste, by owners or operators of Solid
Waste disposal sites that are paid or charged by Lessee with respect to
all Non-City Non-Company Waste delivered to the Southeast Landfill
during the Operating Year, above (ii) the total amount of such fees
and/or taxes with respect to such Non-City Non-Company Waste that
would be paid or charged based on the rate of such fees and/or taxes
in effect as of the date of this Agreement.
The "Deemed Company Waste Revenue" for an Operating Year shall
be calculated by multiplying (i) the total Tons of Non-City Company
Waste delivered to the Landfill during the Operating Year by (ii) the
"Agreed Per-Ton Charge" for such Operating Year calculated as
provided below.
The "Agreed Per-Ton Charge" for an Operating Year shall be equal to
the lesser of:
(1) $21.00 per Ton escalated at the rate of 2% on a compounded basis
as of the first of each Operating Year ensuing after the Operating
Year which commences on January 1, 2010; or
(2) ninety percent (90%) of an amount equal to:
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(i) the Net Non-Company Waste Revenue for all Non-City Non-
Company Waste delivered to the Southeast Landfill during the
Operating Year;
divided by
(ii) the total Tons of Non-City Non-Company Waste delivered to the
Southeast Landfill during the Operating Year.
(E) For purposes of calculating the Variable Rent on Solid
Waste that is not weighed, the Lessee shall estimate Tons delivered
based on historical data for the previous seven (7) day period and
other relevant factors.
(F) [Reserved]
(G) [Reserved]
(H) [Reserved]
(I) [Reserved]
(J) [Reserved]"
5. No Abatement or Set-Off of Rent. Section 4.09 and Section 13.2 of the Existing
Agreement are hereby amended and restated in their entirety to read as follows:
"SECTION 4.09. No Abatement or Set-Off of Rent. Lessee
shall not be entitled to any abatement, deduction, deferment,
suspension or reduction of or set-off, defense or counterclaim against,
any Rent payable by Lessee under this Agreement, and the respective
obligations of the City and Lessee shall not be otherwise affected by:
(A)reason of damage to or destruction of the Southeast Landfill from
any cause unless caused by the City, or (B) any taking by
condemnation or eminent domain or by agreement between the City
and those authorized to exercise such rights; provided such taking or
condemnation does not materially impair Lessee's operations at the
Southeast Landfill; it being the intention of the parties that the
respective obligations of the City and Lessee shall be separate and
independent covenants and agreements and that the Rent and all other
charges and sums payable by Lessee hereunder shall continue to be
payable in all events unless the obligations to pay the same shall be
terminated pursuant to the provisions of this Agreement."
"SECTION 13.02. No Abatement. Unless such damage or
destruction is caused by the City, the Lessee's obligation to perform
all covenants and agreements under this Agreement, shall not be
affected by any such damage to or destruction of the Southeast
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Landfill, and the Lessee hereby waives the provisions of any statute
or law now or hereafter in effect that would otherwise relieve the
Lessee from such obligations."
6. Tipping Fee-Non-City Waste. Section 7.03 of the Existing Agreement is hereby
amended and restated in its entirety to read as follows:
"SECTION 7.03. Tipping Fee- Non-City Waste. The Lessee
may charge all Persons that deliver Non-City Waste to the Southeast
Landfill a tipping fee quoted on a per Ton basis as weighed in
accordance with this Agreement. The tipping fee shall include all fees
mandated by any Governmental Entity to be paid by any generator or
transporter of Solid Waste to a landfill."
7. Waste Delivery. Section 8.02 of the Existing Agreement is hereby amended and
restated in its entirety to read as follows:
"SECTION 8.02. Recycling Programs. Both the Lessee and
the City understand that the City may establish, on its own initiative
or in compliance with Applicable Law, recycling programs and other
Solid Waste reduction programs, such as composting programs.
Nothing contained in this Agreement shall be construed to prevent the
City from establishing such programs, or diverting all or a portion of
the waste stream collected by the City, its employees, agents or
contractors, to Recyclables processors, Yard Waste processors, Type
IV Waste, Bulky Waste, and C&D processors, purchasers or recycled
materials or businesses that offer other alternatives to the burial of
Solid Waste. If the City, in good faith sends waste to a Recycling
facility that is rejected as not being suitable for Recycling, the City
shall have no obligation to deliver such rejected waste to the
Southeast Landfill if the City does not elect to do so or to make
payment to Lessee for such rejected waste under Section 8.03 below
if it is not delivered to and accepted at the Southeast Landfill.
8. Payment Obligations of the City. The third sentence of Section 8.03 of the
Existing Agreement is further amended and restated in its entirety to read as follows:
"During the Operating Year commencing on January 1, 2010, and
each Operating Year thereafter, the City shall pay to the Lessee an
amount equal to the lesser of(i) the per Ton charge payable during the
preceding Operating Year, multiplied by the Adjustment Factor, or
(ii) the "Maximum City Gate Rate" as defined below, for each Ton of
City Waste (but not City Department Waste) delivered to the
Southeast Landfill or required to be delivered to the Southeast
Landfill by the City or City Licensed Haulers pursuant to Section
8.01, or Lost Waste, during such Operating Year."
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and by adding the following additional provisions at the end of the first grammatical paragraph of
said Section 8.03:
"The "Maximum City Gate Rate" for any Operating Year shall be an
amount per Ton equal to seventy-five percent (75%) of the lowest
"Posted Gate Rate" (as defined below) in effect at any time during
such Operating Year. The Maximum City Gate Rate shall be
established and adjusted only once per Operating Year. The "Posted
Gate Rate" shall be the tipping fee per Ton that is advertised or
publicly posted by Lessee for Non-City Non-Company Waste
delivered to the Southeast Landfill. Lessee shall have the right to
establish and change the Posted Gate Rate from time to time in
Lessee's sole discretion; and Lessee will notify the City within twenty
(20) days after each change in the Posted Gate Rate. Further, it is
expressly stipulated and understood that Lessee shall have the right,
and expects, to negotiate and agree upon a per-Ton tipping fee that is
different (and usually lower) than the Posted Gate Rate for Non-City
Non-Company Waste delivered to the Southeast Landfill by
individual customers or may impose minimum per-vehicle or per-load
charges for Non-City Non-Company Waste delivered to the Southeast
Landfill that will differ on a per-Ton basis from the Posted Gate Rate.
If the City makes payments to the Lessee for City Waste delivered to
the Southeast Landfill at any time during an Operating Year that are
thereafter determined to exceed the Maximum City Gate Rate for
such Operating Year as a result of a reduction of the Posted Gate Rate
during such Operating Year, Lessee will refund the amount of the
excess payments above such Maximum City Gate Rate within forty-
five (45) days after the effective date of such reduction of the Posted
Gate Rate."
B. Amendments of Existing Agreement as of the Date of this Second Amendment:
The Existing Agreement is hereby amended or supplemented by the following amendments or
supplemental provisions which will be and become effective on and as of the date of this Second
Amendment,to-wit:
1. Base Rent. In view of the change in the definition of"Operating Year"to become
effective as of January 1, 2010, from each twelve month period commencing on March 23 to each
calendar year commencing with the year 2010, it is agreed that, notwithstanding any contrary
provision of Section 4.03 of the Existing Agreement:
(a) The Base Rent for the period from March 23, 2009,
through December 31, 2009, shall be $520,598.00 (equal to
283/365ths of the Base Rent of $671,443.00 that would have been
payable for an Operating Year commencing on March 23, 2009, and
ending on March 22, 2010, rounded to the nearest whole number).
Any additional payment or refund with respect to amounts of Base
Rent that have been paid for the Operating Year commencing on
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March 23, 2009, necessary to adjust the total Base Rent paid for the
period from March 23, 2009, to December 31, 2009, as provided for
in this paragraph shall be effected within twenty (20) days after the
date of this Second Amendment.
(b) In adjusting the amount of the Base Rent to be payable
for the Operating Year commencing on January 1, 2010, by the
Adjustment Factor, such Base Rent payable for the 2010 Operating
Year shall be equal to $671,443.00 (the total Base Rent that would
have been payable for an Operating Year commencing on March 23,
2009, and ending on March 22, 2010) multiplied by an Adjustment
Factor calculated as described in Section 4.03 of the Existing
Agreement using the twelve month period ending on September 30,
2009 as the "Index Year preceding" the 2010 Operating Year and
using the twelve month period ending on September 30, 2008, as
the"Index Year two years preceding"the 2010 Operating Year.
2. Variable Rent. Variable Rent payable for each Ton of Non-City Waste
delivered to and accepted at the Southeast Landfill prior to January 1, 2010, shall continue to be
calculated and payable as provided in the Existing Agreement.
3. Notices. Section 15.01(b) of the Existing Agreement is hereby amended and restated
in its entirety to read as follows:
"(b) If to Lessee:
Allied Waste Systems, Inc.
General Counsel
18500 North Allied Way
Phoenix, AZ 85054
Fax: (480) 627-2701
With a copy to:
Area President
Republic Services, Inc.
1212 Harrison Avenue
Arlington, TX 76001
Fax: (817) 459-4663
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With a copy to the Guarantor:
Republic Services, Inc.
Corporate Secretary
18500 North Allied Way
Phoenix,AZ 85054
Fax: (480) 627-2701"
C. Assignment. If Allied Waste Systems, Inc. shall cease to exist as a legal entity
authorized to do business in the State of Texas as the Lessee under this Agreement, then Lessee
agrees to assign its duties and responsibilities to a subsidiary of Republic Services, Inc. authorized
to do business in the State of Texas pursuant to Section 16.03 of the Agreement.
D. Miscellaneous. Nothing contained herein shall be deemed to amend or modify the
Existing Agreement except as expressly set forth herein. Any defined term used herein, but not
defined herein, shall have that meaning set forth in the Existing Agreement. In the event of a
conflict between the terms of this Second Amendment and the terms of the Existing Agreement, the
terms of this Second Amendment shall control. As amended by this Second Amendment, the
Existing Agreement is ratified and confirmed and declared to be in full force and effect.
75870351.2
SECOND AMENDMENT SELF LEASE
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IN WITNESS WHEREOF, this Second Amendment has been executed as of the date first
set out hereinabove.
LESSEE:
ALLIED WASTE SYSTEMS, INC., d/b/a
TRINITY WASTE SERVICES
By:
Its:
Date Signed: Z>,e-r�,,,,64-4- as. ?QPs
CITY:
CITY OF FORT WORTH, TEXAS
Fernando Costa
Assistant City Mana r
Date Signed: /,2 28 0'
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City Secretary Date �Qa
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Christ R.Reynold 0 0o x�
Assistant City Attorney �a 000 00o i��y
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OFFICIAL. RECORDI
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