HomeMy WebLinkAboutContract 31532 CITY SECRETAM
CONTRACT NO.
FIRST AMENDMENT TO CITY SECRETARY CONTRACT NO. 30908
WHEREAS, the City of Fort Worth, a municipal corporation situated in Tarrant,
Wise and Denton Counties, Texas, hereinafter called "City", and Renda Environmental,
Inc., hereinafter called "Contractor", entered into City Secretary Contract No. 30908 on
November 15, 2004 (M & C C-20131);
WHEREAS, City Secretary Contract No. 30908 extended City's contract with
Contractor for solids dewatering, processing and disposal at the Village Creek
Wastewater Treatment Plant(the "Facility")to March 31, 2010;
WHEREAS, City Secretary Contract No. 30908 also provided for Contractor to
operate and maintain the gas turbine generators (the "Generators") at the Facility for a
term expiring on March 31, 2005, unless extended in writing by the parties in accordance
with Exhibit"A", "Terms of Operation and Maintenance of the Electric Generating Plant
(`Facility') located at the Village Creek Wastewater Treatment Plant Site";
WHEREAS, City and Contractor wish to amend Exhibit "A" to City Secretary
Contract No. 30908 to extend the term of the contract for operation and maintenance of
the Generators at the Facility to March 31, 2010 and to amend the compensation, contact,
and Contractor requirements provisions;
WHEREAS, City and Contractor wish to amend Attachment A, "Insurance", to
Exhibit "A" to City Secretary Contract No. 30908 to amend Contractor's insurance
requirements for the contract for operation and maintenance of the Generators;
WHEREAS, M & C C-20131 authorized the City to purchase landfill gas from
Contractor for use in the Generators at the Facility;
WHEREAS, City and Contractor wish to amend City Secretary Contract No.
30908 to provide for Contractor to sell landfill gas to City and for City to purchase
landfill gas from Contractor;
NOW, THEREFORE, City, acting herein by and through Marc Ott, its duly
authorized Assistant City Manager, and Contractor, acting herein by and through Oscar
Renda, its duly authorized president, enter into the following amendment to City
Secretary Contract No. 30908:
I.
Section A, "Compensation to Contractor", of Exhibit"A"to City Secretary
Contract No. 30908 is amended to read as follows:
For operation and maintenance of the Facility as set forth below,
Contractor shall be compensated in the amount of $55,500 per month,
with an annual CPI adjustment, not to exceed the current yearly and total
contract caps on price increases (3.5% and 15% respectively) until
Contractor enters into an agreement for the operation and maintenance of
generators similar to the Generators that are the subject of this Agreement.
Contractor shall promptly notify City of the execution of such an
agreement. Effective on the date of execution of such agreement, the
monthly charge for operation and maintenance of the Generators shall be
reduced by $7,500. The reduced monthly charge shall be subject to an
annual CPI adjustment, not to exceed the current yearly and total contract
caps on price increases (3.5% and 15% respectively). The first annual
CPI adjustment shall be on April 1, 2005 and shall be 75% of CPI.
Thereafter, annual CPI adjustments shall be made on April 1, 2006 and on
each subsequent April 1 during the term of this Agreement.
II.
Section C, "Contacts", of Exhibit"A"to City Secretary Contract No. 30908 is
amended to change the Plant Contact, to read as follows:
Madelene Rafalko, P.E.
Senior Professional Engineer
City of Fort Worth
Village Creek WWTP
4500 Wilma Lane
Arlington, Texas 76012
Telephone: 817-392-4926
E-mail: Madelene.Rafalkoafortworthgov.orQ
III.
Section G(2)(a), "Term", of Exhibit"A"to City Secretary Contract No. 30908 is
amended to read as follows:
a. Term. The term of this Agreement shall expire on March 31, 2010, unless
extended by mutual agreement, in writing, signed by all parties to the
Contract.
IV.
Attachment A, "Insurance",to Exhibit"A"of City Secretary Contract No. 30908
is hereby amended by substituting the Attachment A attached hereto.
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V.
Section D, "General Requirements of Contractor", of Exhibit "A" to City
Secretary Contract No. 30908 is amended by adding Subsection 7, to read as follows:
7. Operate and maintain the landfill gas pipeline from the Fort Worth side of the
metering device owned by Renovar Arlington, Ltd. or a related entity to the
Facility.
VI.
City Secretary Contract No. 30908 is amended by adding Section 9, to read as
follows:
Contractor agrees to sell landfill gas to City,pursuant to the terms and conditions
set forth in Exhibit"A"to this Amendment.
THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.
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VII
All other provisions of City Secretary Contract No. 30908, which are not
expressly amended herein, shall remain in full force and effect.
Signed in triplicate, each of which is deemed an original, on this day
of April, 2005.
CITY OF FORT WOR
By
Marc Ott,A sis t City Nidnager
ATTEST: 'or.t_:-aci �horiz tion
---bLu
zte
Marty Hendrix, Secretary
Approved as to Form and Legality
Assistant C Attorney
RE VIR NMENTAL, INC.
By:
Raquel Giovanna, Chief Operations Officer
ATTEST:
0 orate Secretary
4 CITV IX211
INSURANCE
Attachment A
Contractor shall, at its sole expense, maintain in effect at all times during the term of this
Agreement and as otherwise required hereunder, insurance coverages with limits not less than
those set forth below with insurers licensed to do business in Texas and acceptable to City and
under forms of policies satisfactory to City. The requirements contained herein as to types,
limits or City's approval of insurance coverage to be maintained by Contractor are not intended
to and shall not in any manner limit, qualify or quantify the liabilities and obligations assumed
by Contractor under this Agreement or otherwise provided by law.
1. Coverage Minimum Amounts and Limits
A. Workers' Compensation.
Workers' Compensation Statutory Limits
Employer's Liability $500,000 disease-policy limit
$100,000 disease-per each employee
$100,000 each accident\occurrence
This policy shall include a Waiver of Subrogation in favor of the Indemnitees (as defined in this
Agreement).
B. Commercial General Liability.
Bodily Injury/ $1,000,000 each occurrence, or
Property Damage equivalent, subject to a
(Occurrence Basis) $2,000,000 aggregate applicable
to the services performed under this
Agreement
This policy shall be endorsed to include the Indemnitees as additional insureds, contain cross-
liability and severability of interest endorsements, which state that this insurance is primary
insurance as regards any other insurance carried by any Indemnitee, and shall include the
following coverages:
(1) Premises/Operations;
(2) Independent Contractors;
(3) Completed Operations for a period of three years following the
date of the completion of the services performed under the Agreement;
(4) Broad Form Contractual Liability specifically in support of, but not
limited to,the Indemnity sections of this Agreement;
(5) Broad Form Property Damage;
(6) Personal Injury Liability with employee and contractual exclusions
removed; and
(7) Delete Exclusions relative to Collapse, Explosion and
Underground Property Damage.
C. Automobile Liability.
$1,000,000 each accident on a combined single limit basis
or
$250,000 Property Damage
$500,000 Bodily injury per person per occurrence
This policy shall be on a standard form written to cover all owned, hired and non-
owned automobiles. The policy shall be endorsed to include the Indemnitees as additional
insureds, contain cross-liability and severability of interest endorsements, and state that this
insurance is primary insurance as regards any other insurance carried by any Indemnitee.
D. Boiler and Machinery Coverage
Property damage. Minimum limit that will be maintained shall be $1.5 million
with consequential damages limit of$1,000,000. Coverage shall be location specific at 4500
Wilma Drive, Fort Worth, Texas co-generation facility.
E. Umbrella Excess Liability Insurance.
Bodily Injury $5,000,000 per occurrence
Property Damage $5,000,000 aggregate
(Occurrence Basis)
This policy shall be written on a following form umbrella excess basis
above the coverages described in A, B and C above, and shall be endorsed to include the
Indemnitees as additional insureds.
F. Professional Liability.
Contractor agrees to provide and maintain, at its expense,a Professional
Liability Insurance Policy(which shall contain no exclusions for asbestos or pollution liability)
of$2 million for a period not less than two (2)years after the date of the completion of the
services performed pursuant to this Agreement. Contractor shall provide City with a copy of the
terms and conditions of the policy providing Professional Liability coverage.
G. Contractor's Equipment Policy.
Any such insurance policy covering Contractor's or any Subcontractors'
equipment against loss by physical damage shall include an endorsement waiving the insurer's
right of subrogation against the Indemnitees. Such insurance shall be Contractor's and any
Subcontractors' sole and complete means of recovery for any such loss. SHOULD CONTRACTOR
OR ANY SUBCONTRACTOR CHOOSE TO SELF INSURE THIS RISK, IT IS EXPRESSLY AGREED THAT
CONTRACTOR AND SUCH SUBCONTRACTORS HEREBY WAIVE ANY CLAIM FOR DAMAGE OR LOSS
TO SAID EQUIPMENT IN FAVOR OF THE INDEMNITEES, EVEN IF SUCH DAMAGE OR LOSS ARISES
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FROM OR IS ATTRIBUTED TO THE SOLE OR CONCURRENT NEGLIGENCE OF ANY INDEMNITEE OR
FROM STRICT LIABILITY.
H. Contractor's Pollution Liability Insurance.
Contractor shall provide and maintain, at Contractor's expense,Pollution
Liability Insurance Coverage(which shall contain no exclusions for asbestos or other types of
pollution liability)in an amount not less than$2,000,000 per occurrence. The Pollution Liability
Insurance policy must be written on a standard form and endorsed to include the Indemnitees as
additional insureds, contain cross-liability and severability of interest endorsements, and state
that this insurance will be primary insurance as regards any other coverage the Indemnitees may
have.
2. Other Requirements.
(a) Evidence of the foregoing insurance coverage required to be maintained
by Contractor,represented by Certificates of Insurance issued by the insurance carrier(s), must
be furnished to the City. Certificates of Insurance shall specify the additional insured status
mentioned above as well as the waivers of subrogation. Such Certificates of Insurance shall state
that City will be notified in writing sixty(60)days prior to cancellation,material change, or non-
renewal of insurance. Contractor shall provide to City a certified copy of any and all applicable
insurance policies upon request of City. Timely renewal certificates will be provided to City as
the coverage renews.
(b) Insurance similar to that required of Contractor shall be provided by or on
behalf of all Subcontractors to cover their operations performed under this Agreement.
Contractor shall be held responsible for any modifications in these insurance requirements as
they apply to Subcontractors. Contractor shall maintain Certificates of Insurance from all
Subcontractors, enumerating, among other things,the waivers in favor of, and insured status of,
the Indemnitees, as required herein, and make them available to City upon request. The term
"Subcontractor(s)"as used throughout this Agreement shall include subcontractors of any tier.
(C) CONTRACTOR HEREBY RELEASES,AND SHALL CAUSE ITS INSURERS,ITS
SUBCONTRACTORS, AND THEIR INSURERS TO RELEASE CITY AND THE OTHER INDEMNITEES
FROM ANY AND ALL CLAIMS OR CAUSES OF ACTION WHATSOEVER WHICH CONTRACTOR,ITS
INSURERS,ITS SUBCONTRACTORS AND/OR THEIR INSURERS MIGHT OTHERWISE POSSESS
RESULTING IN OR FROM OR IN ANY WAY CONNECTED WITH ANY LOSS COVERED OR WHICH
SHOULD HAVE BEEN COVERED BY INSURANCE,INCLUDING THE DEDUCTIBLE PORTION
THEREOF,MAINTAINED AND/OR REQUIRED TO BE MAINTAINED BY CONTRACTOR AND/OR ITS
SUBCONTRACTORS PURSUANT TO THIS AGREEMENT,EVEN IF SUCH CLAIMS OR CAUSES OF
ACTION ARISE FROM OR ARE ATTRIBUTED TO THE SOLE OR CONCURRENT NEGLIGENCE OF ANY
INDEMNITEE OR FROM STRICT LIABILITY.
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EACH OF THE OTHER PARTIES AND THEIR RESPECTIVE DIRECTORS, OFFICERS,
STOCKHOLDERS, PARTNERS, AFFILIATED COMPANIES, ELECTED OFFICIALS,
EMPLOYEES,AGENTS,ATTORNEYS,CONSULTANTS, CONTRACTORS, SUCCESSORS
AND ASSIGNS AND ANY AND ALL PERSONS OR ENTITIES THAT MAY BE RELATED
TO EACH OR ANY OF THEM, WHETHER OR NOT NAMED HEREIN(COLLECTIVELY,
"RELEASEES") OF AND FROM ANY AND ALL CLAIMS, DEMANDS, CAUSES OF
ACTION, AFFIRMATIVE DEFENSES, ATTORNEYS' FEES AND COSTS, OF EVERY
KIND AND NATURE WHATSOEVER RELATING TO LANDFILL GAS, WHETHER NOW
KNOWN OR UNKNOWN, LEGAL, EQUITABLE, STATUTORY OR OTHERWISE
("CLAIMS"), THAT ACCRUED PRIOR TO THE EXECUTION OF THIS AGREEMENT,
EVEN IF SUCH CLAIMS ARISE FROM OR ARE ATTRIBUTED TO STRICT LIABILITY
OR THE SOLE OR CONCURRENT NEGLIGENCE OF ANY RELEASEE.
Signed in triplicate, each of which is deemed an original, on this day of April,
2005.
CITY OF FORT WORT
W,By:
Marc ba,4ssis6nt City Manager ol
ATTEST: Cori :ac - Authori ation
P-C\ �
Marry Hendrix City Secretary
Approved as to Form and Legality
Assistant ity Attorney
ENVIRONMENTAL, INC.
By:
Raquel Giovanna, Chief Operations Officer
ATTEST:
(;rpor�ate Secretary
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Exhibit"A"
Terms and Conditions for Supply of Landfill Gas
and Performance of Related Services
I. DEFINITIONS
1.1 Digester Gas. Gas that is produced from the anaerobic digestion of organic solids
that have been removed during the wastewater treatment process, composed
primarily of methane (CH4)and carbon dioxide(CO2).
1.2 Generators. The gas turbine/generators owned by the City of Fort Worth
("City") located on the Premises, which currently consist of two Taurus 60 gas
turbine generators and auxiliary equipment.
1.3 Landfill. The City of Arlington Landfill located at 800 Mosier Valley Road
at FM 157.
1.4 Landfill Gas. Biogenic gas generated by natural processes associated with the
decomposition of waste and collected at the Landfill.
1.5 Landfill Gas Collection System. The network of recovery wells and
interconnecting pipes and related equipment, including valves, pumps,
compressors, dehydration equipment, monitoring and measuring devices and
distribution pipelines and other extraction, processing and transportation related
equipment, associated with transport or delivery of the Landfill Gas from the
Landfill to the Premises.
1.6 MMBtu. An MMBtu is equal to one million Btu and a Btu is the amount of
heat required to raise the temperature of one avoirdupois pound of pure water from
58.5 degrees Fahrenheit to 59.5 degrees Fahrenheit under standard pressure of 30
inches of mercury at or near its point of maximum density. This Amendment may
refer to volumes or quantities of Landfill Gas calculated as the actual heating value
of those volumes in MMBtu, rather than the actual volumes measured in standard
cubic feet.
1.7 Point of Delivery. That point immediately past the existing gas meter owned,
operated and maintained by Renovar located near the Generators on the Premises,
as shown on Attachment"A".
1.8 Premises. The City of Fort Worth's Village Creek Wastewater Treatment
Plant, which is located at 4500 Wilma Lane, Arlington, Texas 76012.
1.9 Renovar Agreement. That certain agreement between Renda Environmental, Inc.
("Contractor") and Renovar Energy Corp. ("Renovar") dated April 11, 2005,
pursuant to which Contractor purchases Landfill Gas from Renovar for sale to the
City for use in the Generators, a copy of which is attached as Attachment`B".
II. SUBJECT MATTER AND QUANTITY
2.1 Contractor shall sell and cause delivery of, and City shall receive and pay for, a
supply of Landfill Gas for use only on the Premises for operation of the
Generators, all subject to the other terms and conditions of this Amendment.
Contractor will purchase the Landfill Gas from Renovar pursuant to the Renovar
Agreement.
2.2 Subject to the other terms and conditions of this Amendment, City shall purchase
from Contractor all Landfill Gas purchased from Renovar pursuant to the Renovar
Agreement, up to a maximum of 24,000 MMBtu per month. If Contractor
receives more than 24,000 MMBtu of Landfill gas from Renovar in any month,
City will have no obligation to pay Contractor for any Landfill Gas in excess of
24,000 MMBtu.
2.3 Contractor's obligation to deliver Landfill Gas, and City's obligation to buy
Landfill Gas are limited by: (a) Force Majeure events in accordance with article
XI; (b) inability to burn Landfill Gas due to normal maintenance operations
(planned and unplanned) on the Premises (including both Generators) or on the
Landfill (including the Landfill Gas Collection System); and (c) inability to burn
Landfill Gas due to the making of repairs on both Generators. Without limiting
the foregoing provisions, the Parties expressly acknowledge that City has no
obligation to buy Landfill Gas during periods in which both Generators are
undergoing maintenance or repairs, either on or off the Premises.
2.4 Contractor has a right of first refusal to purchase Excess Landfill Gas from
Renovar pursuant to the Renovar Agreement. Contractor will assign all of
Contractor's rights to purchase Excess Landfill Gas to City upon City's request.
Contractor shall not be entitled to any compensation for the assignment of the
right of first refusal. Further, if this Amendment is terminated for any reason, the
right of first refusal will be deemed to be assigned by Contractor to City and City
will have all rights of Contractor thereunder.
III. SCOPE OF ADDITIONAL SERVICES
In addition to selling Landfill Gas to City pursuant to article II, Contractor will perform
the following services for the benefit of City:
(a) Coordinate environmental compliance requirements for the Generators by
working with Village Creek Wastewater Treatment Plant staff and the City's
environmental contractor, including without limitation (i) stack gas testing
coordination; and (ii) taking biogas samples and forwarding to outside
laboratory for testing. City will famish sample canisters and pay testing costs.
City remains responsible for compliance with air permit requirements.
(b) Coordinate the distribution of sales proceeds from renewable energy credits
("RECs") in accordance with article IV below. Renovar remains responsible
for the application, ongoing administration and brokerage of the RECs
pursuant to the Renovar Agreement. Contractor will assist Renovar with the
application for the RECs by supplying technical drawings and information
required by the Electric Reliability Council of Texas and the Public Utility
Commission.
(c) Facilitate any equipment or metering modifications needed to qualify the
Premises for REC credits. Contractor will purchase and install a Digester Gas
flow meter on the Premises at a cost not to exceed $5,000 to accurately
calculate the monthly REC distribution between Landfill Gas and Digester
Gas. If the purchase price of the meter and labor for the installatio -exceeds ,
$5,000, Contractor shall notify City in writing of the total cost and ity may .
elect to require Contractor to proceed with the purchase and acquisition and
City shall pay all costs in excess of $5,000. All other equipment and
metering modifications will be paid for out of initial REC money as outlined
in the Renovar Agreement.
(d) Coordinate the daily flow, pressure and volume of Landfill Gas, Digester Gas,
and natural gas, if any, to support the daily mix of fuels to meet electrical
demand;
(e) Review gas quality test reports provided by Renovar on at least a monthly
basis;
(f) Capture and test four additional landfill gas samples per year;
(g) Calculate flows to verify Renovar readings at least once per month;
(h) Notify Renovar and Village Creek Wastewater Treatment Plant managers if
the Landfill Gas fails to meet contract specifications required by the Renovar
Agreement;
(i) Actively participate in testing and review of fuel meters on an annual basis or
as otherwise required by the Renovar Agreement; and
(j) Recommend to City when it is in City's best interest to purchase natural gas
for use in the Generators.
IV. TERM
Unless terminated earlier as provided in this Amendment, the Initial Term of this
Amendment shall commence on the date that City can take delivery of Landfill Gas for
use in at least one of the Generators, to be determined in City's sole discretion("Effective
Date") and shall terminate on March 31, 2010.
V. PAYMENTS TO CONTRACTOR
5.1 The price payable by City to Contractor for the Landfill Gas shall be equal to
Contractor's actual cost of Landfill Gas pursuant to the Renovar Agreement, not
to exceed $72,000 per month (the "Base Landfill Gas Price" as defined in section
4.1 of the Renovar Agreement), as adjusted pursuant to section 4.1 and section 4.2
of the Renovar Agreement.
5.2 As compensation for the services rendered pursuant to article III above, City shall
pay Contractor $11,000 per month; provided, however, if no Landfill Gasis
accepted by Contractor for use in the Generators in any calendar month,
Contractor shall not be entitled to any compensation under this section for such
month.
VI. RENEWABLE ENERGY CREDITS
6.1 The parties recognize that renewable energy credits ("RECs") may be created and
attributable to the use of Digester Gas and Landfill Gas in the Generators.
6.2 "Base Landfill Gas Price", "Adjusted Landfill Gas Price" and "Effective Landfill
Gas Price" shall have the same meaning herein as in the Renovar Agreement.
"Base Landfill Gas Price" means $72,000 per month for 24,000 MBTU, and
"Adjusted Landfill Gas Price" means the Base Landfill Gas Price adjusted
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annually beginning October 1, 2006, based on the Urban Wage Earner and
Clerical Workers U.S. City Average Consumer Price Index, in accordance with
section 4.1 of the Renovar Agreement. "Effective Landfill Gas Price" means
$3.55 per MMBtu pursuant to section 5.3(b) of the Renovar Agreement, subject to
adjustment in accordance with section 6.4 below.
6.3 Contractor shall distribute proceeds from the sale of RECs for power produced by
the Generators from Landfill Gas and Digester Gas, net of brokerage fees, and
provide an accounting of such distribution to Renovar and City within 30 days
after receipt of the funds, as follows.
(a) Reimburse Renovar and Contractor for expenses pursuant to section 5.7 of the
Renovar Agreement;
(b) Pay any remaining Landfill Gas REC sales proceeds to Renovar until the total
sales price received by Renovar for Landfill Gas delivered by Renovar and
accepted by Contractor for use in the Generators equals $3.55 (the "Effective
Landfill Gas Price), subject to adjustment in accordance with section 6.4
below;
(c) Pay any remaining proceeds from the sale of Landfill Gas RECs greater than
the amount required to reach the Effective Landfill Gas Price to City and
Renovar, in equal amounts; and
(d) Pay 100% of the proceeds from the sale of RECs attributable to Digester Gas
to City.
The following example assumes 24,000 MMBtu of Landfill Gas delivered
by Contractor and accepted by City in the month of April, 2005, and
receipt by Contractor of REC sales proceeds of$33,000 for electricity
produced in April, 2005, by burning Landfill Gas and Digester Gas in the
Generators.
Contractor calculates% attributable to Landfill Gas and Digester Gas.
Assume for purposes of example 60%attributable to Landfill Gas
($19,800) and 40% attributable to Digester Gas ($13,200).
Contractor pays Renovar $13,200 from Landfill Gas RECs to increase the
Effective Landfill Gas price to $3.55 per MMBtu($.55 x 24,000 MMBtu).
In addition, Contractor pays Renovar$3,300 (50%of$6,600 Landfill Gas
balance), for a total payment to Renovar of$16,500.
Contractor pays City $13,200 (REC proceeds attributable to Digester Gas)
plus $3,300 (50%of$6,600 Landfill Gas REC balance) or, at Contractor's
option, Contractor may deduct$16,500 from the next monthly invoice to
City for City's purchase of Landfill Gas from Contractor.
6.4 Whenever the Base Landfill Gas Price is increased in accordance with section
4.1 of the Renovar Agreement, the Effective Landfill Gas Price will be i ased______.
by the same amount, so that the difference between the Adjusted Lanfllfq .`.�
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Price and the Effective Landfill Gas Price in any month remains $.55/MMBtu,
pursuant to section 5.4 of the Renovar Agreement.
6.5 Contractor may retain REC proceeds payable to City pursuant to section 6.3(c)
and (d) above and deduct such amounts from Contractor's next invoice to City (or
multiple invoices if the REC proceeds retained by Contractor exceed the amount
owed by City on the next monthly invoice).
6.6 If Landfill Gas displaces Digester Gas for use in the Generators, and the displaced
Digester Gas is flared, City will receive 100% of the payment for RECs
attributable to the Landfill Gas that displaced the flared Digester Gas, and no
payment will be made to Renovar for such RSCS; provided, however, payment to
Renovar for RECs shall be calculated based on not less than 24,000 MMBtu per
month or the volume of Landfill Gas made available by Renovar for delivery,
whichever is less.
6.7 City may, upon written notice to Contractor, assume some or all of Contractor's
duties concerning RECs.
6.8 Contractor shall deliver all software, equipment and other items purchased using
REC sales proceeds to City within ten (10) business days after termination of this
Amendment or upon request by City, whichever occurs first.
6.9 If Renovar requests Contractor's written approval of a transaction for the sale of
future RECs for a period covering more than three months, Contractor shall notify
City prior to responding to Renovar's request. Contractor shall not give Renovar
written approval of such a sales transaction unless City notifies Contractor in
writing of its approval of the sale.
6.10 Contractor shall provide City with copies of all documents relating to RECs
provided to Contractor by Renovar within ten (10) days of receipt, including
without limitation: (i) all documents filed with brokers or governmental agencies;
and(ii) documentation of all sales transactions.
VII. CALCULATION AND PAYMENT OF CHARGES
7.1 Contractor will invoice City as soon as reasonably practicable after the end of
each calendar month. The invoice will be in the amount of the invoice submitted
to Contractor by Renovar. Contractor may retain REC proceeds payable to City
pursuant to section 6.3(c) and (d) above and deduct such amounts from
Contractor's next invoice to City (or multiple invoices if the REC proceeds
retained by Contractor exceed the amount owed by City on the next monthly
invoice). City will pay the invoiced amount not more than twenty (20) days
following the date the invoice is received. If City in good faith disputes any
portion of Contractor's invoice, City will pay the undisputed portion within the
time stated above, and concurrently advise Contractor in writing of the particulars
of such dispute. In the event that City gives notice of such dispute, the parties
shall, for a period of thirty (30) calendar days following Contractor's receipt of
that notice, pursue diligent, good faith efforts to resolve the dispute. Following
resolution of the dispute, any amount found payable shall be reflected in the next
month's invoice to City and paid by the due date for such invoice. If s_ta
pay any amount due, or if the Parties are unable to resolve a dispu ed invoice
during that thirty (30) day period, interest will accrue on the unpaid po 'off
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subsequently found to have been payable at a rate equal to the lesser of (i) three
percent above the "Prime Rate" as published in The Wall Street Journal under
"Money Rates," from time to time, or an appropriate substitute should such rate
cease to be published, or (ii) the highest rate allowed by law, from the date such
payment is due until the same is paid.
7.2 No party receiving proceeds under this Amendment may request any adjustment
or correction of any statement or payment unless written notice of such request
for adjustment or correction is furnished within two years after payment therefore
has been made.
7.3 Any adjustment in the invoice by Renovar to Contractor shall be reflected in the
next month's invoice sent by Contractor to City.
7.4 Payments may be made by check, wire transfer, direct debit or electronic data
interchange, on terms acceptable to both Parties. Payment shall be made to the
address set out in article XII.
7.5 Contractor shall deliver the Landfill Gas analysis provided to Contractor by
Renovar pursuant to section 6.4 of the Renovar Agreement to City together with
the invoice delivered pursuant to section 7.1.
7.6 If Contractor fails to pay Renovar for Landfill Gas within thirty (30) days after
the invoice is received, pursuant to section 6.1 of the Renovar Agreement, and
Renovar provides written notice of such nonpayment to City, City may amounts
owed to Contractor pursuant to this Amendment to Renovar.
VIII. METERING EQUIPMENT
8.1 Digester Gas produced on the Premises and used in the Generators will be
measured by means of measuring devices of standard type, which will be
installed, operated and maintained by Contractor. Contractor shall routinely test
for accuracy, and service and calibrate if necessary, the measuring device during
each twelve (12) month period. Copies of the results of calibration and all related
information shall be provided to City. City shall have access to the metering
facilities at all reasonable times. Contractor shall notify City of any proposed test at
least forty-eight (48) hours prior to such test being conducted and City may observe
such test, if so desired. For the purpose of instrument and meter calibration, the
atmospheric pressure is assumed, unless otherwise established by the Standard
Gas Measurement Law, to be 14.4 psig.
8.2 Contractor shall keep all records from all measuring equipment on file for a
period of not less than three years, unless state or federal laws or regulations
require a longer retention period.
8.3 Upon request, Contractor shall make available to City volume records from the
measuring equipment, together with calculations therefrom, for inspection and
verification, subject to return within 30 days after receipt thereof.
8.3 The meters for measurement of volumes of gas hereunder shall be installed and
operated, and gas measurement computations must be made, in accordance with
current industry standards. Orifice metering must be performed in accordance
with the latest version of A.G.A. Report No. 3 - ANSUAPI 2530. Positive
displacement and rotary metering must be performed in accordance with the latest
version of ANSI B 109.1, B 109.2 or B 109.3. Ultrasonic metering must be
6
performed in accordance with the latest version of A.G.A. Report No. 9.
Electronic gas measurement must be performed in accordance with the latest
version of API Manual of Petroleum Measurement Standards Chapter 21 - Flow
Measurement Using Electronic Metering Systems.
8.4 Contractor shall provide City with copies of all meter measurement and
calibration test results relating to the Landfill Gas meter provided to Contractor by
Renovar pursuant to article VII of the Renovar Agreement within thirty (30) days
of receipt.
IX. GAS DELIVERY, PRESSURE AND QUALITY
9.1 Contractor will use reasonable efforts to ensure Renovar delivers the Landfill Gas
at the Point of Delivery at an average pressure of 60 pounds per square inch,
gauge ("psig"); provided, however, that the pressure of the Landfill Gas delivered
at the Point of Delivery shall not exceed 65 psig or be below 55 psig. Contractor
will also use reasonable efforts to ensure the Landfill Gas delivered by Renovar to
Contractor for sale to City shall meets the following specifications:
(a) contains at least 45%by volume of methane;
(b) contains not more than 15 grains of total sulfur per 100 cubic feet of gas;
(c) contains not more than 1.4%by volume of oxygen;
(d) contains not more than a total of 10% by volume of all non-hydrocarbon
gases, other than carbon dioxide;
(e) contains a gross heating value of at least 450 Btus per cubic foot of gas, on
a water vapor dry basis at a temperature of 60 degrees Fahrenheit and at an
absolute pressure equivalent to 14.65 pounds per square inch absolute
("psia"); however, if the water vapor content is seven pounds per million
cubic feet or less, the Landfill Gas will be deemed dry;
(f) has a water or hydrocarbon dew point of not more than 40 degrees
Fahrenheit at a pressure equal to 60 psig; and
(g) Has a stable heating value and specific gravity that will permit utilization
thereof in the Generators.
9.2 If acceptance of Landfill Gas by Contractor has been suspended for more than
seven (7) consecutive days for any reason, Contractor shall not resume accepting
Landfill Gas without City's written consent.
X. TERMINATION OF AMENDMENT
10.1 A Party may terminate this Amendment upon written notice prior to the expiration
of its term, without prejudice to any other right it may have under this
Amendment, if the other Party commits a material breach of the terms hereof.
Prior to termination, the non-breaching Party shall provide the breaching Parry
with written notice that describes the breach in reasonable detail. The breaching
Party must commence curing such breach within fourteen (14) calendar days after
the breaching Party receives such written notice and commence the cure within
fourteen (14) days from the date of commencement of the cure. If the breaching
Party does not substantially cure such breach within the stated period of time, the
7
non-breaching Party may, in its sole discretion, and without prejudice to any other
right under this Amendment, law or equity, terminate this Amendment by giving
written notice to the breaching Party; provided, however, if the breach is not
reasonably susceptible to cure by the breaching Parry within the time stated in the
notice, the non-breaching Parry shall not exercise its option to terminate this
Amendment so long as the breaching Parry has commenced to cure the default
within the stated time period and diligently completes the work within a
reasonable time without unreasonable cessation of the work to complete the cure.
Amendment.
10.2 If the City does not appropriate sufficient money to pay Contractor for Landfill
Gas for any fiscal year of City during which this Amendment is in effect,then this
Amendment will terminate at the end of the most recent fiscal year for which
funds had been appropriated for City to purchase Landfill Gas from Contractor.
For purposes of this Amendment, City's fiscal year is October 1 through
September 30 ("Fiscal Year"). City shall notify Contractor of City's failure to
appropriate funds to purchase Landfill Gas from City, before the end of City's
Fiscal Year, provided, however, City's failure to send notice shall create no
obligation by City to Contractor.
10.3 If the Renovar Agreement is terminated, Contractor may terminate this
Amendment.
10.4 If Contractor ceases to operate and manage the Generators pursuant to City
Secretary Contract No. 30908, City may terminate this Amendment.
10.5 If this Amendment is terminated for any reason under this article, City shall pay
Contractor any funds owed for gas delivered or services rendered prior to
termination for which Contractor has not been paid. Other than this payment,
Contractor shall not be entitled to any other compensation of any kind or nature,
including but not limited to lost or anticipated profits.
XI. FORCE MAJEURE
If either Party is unable to perform its obligations in whole or in part due to an event of
Force Majeure as defined herein, then the obligations of the affected Parry shall be
suspended to the extent made necessary by such event, provided that (i) the non-
performing Party, within two weeks after the occurrence of the Force Majeure, gives the
other Party written notice describing the particulars of the occurrence; (ii) the suspension
of the performance be of no greater scope and of no longer duration than is required by
the Force Majeure; (iii) no obligations of either Party that arose prior to the occurrence
causing the suspension of performance be excused as a result of the occurrence; and (iv)
the non-performing Party will use reasonable efforts to remedy with all reasonable
dispatch the cause or causes preventing it from carrying out its obligations. The term
"Force Majeure" means any cause not within the control of the Parry claiming relief,
including, but not limited to, acts of God; governmental authority; civil disorder; strikes
or labor disputes; failure, repair or change of or obstruction in the Landfill Gas Collection
System or both Generators; depletion or failure of Landfill Gas supply; an event of force
majeure of the transporter of the Landfill Gas; breakdown of both Generators; or any
other cause that by the exercise of reasonable diligence such Parry could not have
prevented or is unable to overcome. It is understood and agreed that the settleinent of ,
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strikes or lockouts will be entirely within the discretion of the Party having the difficulty,
and that the above requirements of the use of diligence in restoring normal operating
conditions will not require the settlement of strikes or lockouts by acceding to the terms
of the opposing party when such course is inadvisable in the discretion of the Party
having the difficulty. Neither financial distress nor the inability of either Party to make a
profit or avoid a financial loss shall be deemed a Force Majeure event, unless caused by
one of the foregoing factors.
XII. NOTICES
Unless otherwise provided herein, all notices required or permitted under this
Amendment shall be in writing and shall be deemed to be delivered when deposited in
the United States mail (registered or certified), postage prepaid, when deposited with an
overnight delivery service, prepaid to the addresses shown below, or to such address as
any Party may from time to time designate as the address, or in the case of hand
delivery, when delivered to a representative of a Party by a representative of any other
Party; provided, however, except for payments of amounts due hereunder, a Party may
provide such items hereunder by facsimile to the other Parties.
If to Contractor:
Renda Environmental
2501 Greenbelt Road
Fort Worth, Texas 76118
Facsimile: (817) 571-6783
If to City:
City of Fort Worth
1000 Throckmorton
Fort Worth, Texas 76102
Attn: City Manager
Facsimile: (817) 392-6134
City of Fort Worth
1000 Throckmorton
Fort Worth, Texas 76102
Attn: Water Director
Facsimile: (817) 392-8195
Plant Engineer
Village Creek Wastewater Treatment Plant
4500 Wilma Lane
Arlington, Texas 76102
Facsimile: (817) 548-5758
XIII. RESPONSIBILITY
After such delivery of gas at the Point of Delivery, Contractor will be deemed to be in
exclusive control thereof and responsible for any damages or injuries to persons or
property caused thereby, and shall indemnify, defend and hold harmless City and each of
its successors, assigns, elected officials, partners, agents, representatives, consultants,
contractors, attorneys and employees (collectively, "Indemnitees") for, from and against
any damages or injuries to persons or property caused thereby while the same is in
Contractor's control, except damages and injuries attributable to the negligence or fault
of City or its agents.
XIV. INSURANCE
Contractor shall, at its sole expense, provide and maintain in effect at all times during the
term of this Agreement and/or at any time during which Contractor is providing any
services related to this Agreement, and as otherwise required hereunder, insurance
coverages as set forth in Attachment C to this Agreement.
XV. AUDIT
Contractor agrees that City shall, until the expiration of three (3) years after final
payment under this Amendment, have access to and the right to examine any directly
pertinent books, documents, papers and records of Contractor involving transactions
relating to this Amendment. Contractor agrees that City shall have access during normal
working hours to all necessary facilities of Contractor and shall be provided adequate and
appropriate workspace in order to conduct audits in compliance with the provisions of
this section. City shall give Contractor reasonable advance notice of intended audits.
Contractor agrees to photocopy such documents as may be requested by City: City
agrees to reimburse Contractor for the costs of copies at the applicable rate published in
Texas Administrative Code, Chapter 111, Subchapter C, Rule 116.63, or as subsequently
recodified.
XVI. MISCELLANEOUS
16.1 Regulatory and Legislative Bodies. This Amendment is subject to all applicable
laws, regulations, rules and orders of all regulatory and legislative bodies now or
hereafter having jurisdiction over either party, or the Landfill Gas covered
hereunder.
16.2 Governing Law; Jurisdiction and Venue. This Amendment shall be governed by
and construed in accordance with the laws of the State of Texas, as it applies to
contracts performed within the State of Texas and without regard to any choice of
law rules or principles to the contrary. The parties acknowledge that this
Amendment is performable in Tarrant County, Texas and hereby submit to the
exclusive jurisdiction of the state courts of Tarrant County, and hereby agree that
any such Court shall be a proper forum for the determination of any dispute
arising hereunder.
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16.3 Assiannient. Except as expressly provided herein, this Amendment may not be
transferred or assigned by a Party without the written consent of the other Parry,
which consent shall not be unreasonably withheld.
16.4 Entirety of Amendment. It is the intention of the Parties that the Amendment shall
supersede all prior agreements regarding sale and purchase of Landfill Gas,
whether written or oral. This Amendment may not be modified or amended
except in writing, duly executed by the Parties hereto.
16.5 Waiver of Rights. A waiver by either Parry of any breach of this Amendment, or
the failure of either Party to enforce any of the terms and provisions of this
Amendment, will not in any way affect, limit, or waive that Party's right to
enforce and compel strict compliance with the same or other terms or provisions
of this Amendment.
16.6 Third Party Rights. Nothing in this Amendment shall create, or be construed as
creating, any express or implied rights in any person or entity other than the
Parties.
16.7 Survival. No termination or cancellation of this Amendment will relieve either
Party of any obligations under this Amendment that by their nature survive such
termination or cancellation, including, but not limited to, all warranties,
obligations of indemnity, and corrections to statements and payments hereunder.
16.8 Further Assurances. City and Contractor agree to provide such information,
execute and deliver any instruments and documents and take such other actions as
may be necessary or reasonably requested by the other Party which are not
inconsistent with the provisions of this Amendment and which do not involve the
assumptions of obligations other than those provided for in this Amendment, in
order to give full effect to and carry out the intent of this Amendment.
16.9 Invalidity. If any term or provision herein contained is held to be invalid by any
court of competent jurisdiction, the invalidity of such term or provision shall in no
way affect any other term or provision contained herein; further, this Amendment
shall then continue as if such invalid term or provision had not been contained
herein.
16.10 Contract Construction. The parties acknowledge that each Party and, if it so
chooses, its counsel have reviewed and revised this Amendment and that the
normal rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of this
Amendment or any amendments or exhibits hereto.
16.11 Counterparts. This Amendment may be executed in several identical counterparts,
and by the Parties on separate counterparts, and each counterpart, when so
executed and delivered, will constitute but one and the same Amendment.
16.12 No Joint Venture, Partnership, Agency. This Amendment will not be construed in
any form or manner to establish a partnership,joint venture or agency, express or
implied, nor any employer-employee, borrowed servant or joint enterprise
relationship by and among the Parties. Contractor and City are each independent
contractors and each shall be responsible at all times for directing its employees in
the course of their duties.
16.13 RELEASE. EACH PARTY ITSELF, AND ON BEHALF OF ITS RESPECTIVE
SUCCESSORS, ASSIGNS, LEGAL REPRESENTATIVES, LENDERS, TRANSFEREES,
HEIRS, AND AGENTS, HEREBY RELEASES, ACQUITS AND FOREVER DISCHARGES
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Attachment B
AGREEMENT FOR SUPPLY OF LANDFILL GAS BETWEEN
RENOVAR ENERGY CORP. AND RENDA ENVIRONMENTAL, INC.
This "Agreement for Supply of Landfill Gas" (the "Agreement") is by and
between Renovar Energy Corp., a Texas corporation ("Seller"), and Renda
Environmental, Inc., a Texas corporation ("Buyer"). Seller and Buyer may hereinafter be
referred to individually as a"Party" and collectively as the "Parties."
I. DEFINITIONS
1.1 Digester Gas. Biogenic gas that is produced from the anaerobic digestion of
organic solids that have been removed during the wastewater treatment process,
composed primarily of methane(CH4) and carbon dioxide(CO2).
1.2 Generators. The gas turbine/generators owned by the City of Fort Worth ("City")
located on the Premises, which currently consist of two Taurus 60 gas turbine
generators and auxiliary equipment.
1.3 Landfill. The City of Arlington Landfill located at 800 Mosier Valley Road at FM
157.
1.4 Landfill Gas. Biogenic gas generated by natural processes associated with the
decomposition of waste and collected at the Landfill.
1.5 Landfill Gas Collection System. The network of recovery wells and
interconnecting pipes and related equipment, including valves, pumps,
compressors, dehydration equipment, monitoring and measuring devices and
distribution pipelines and other extraction, processing and transportation related
equipment, associated with transport or delivery of the Landfill Gas from the
Landfill to the Premises.
1.6 MMBtu. An MMBtu is equal to one million Btu and a Btu is the amount of
heat required to raise the temperature of one avoirdupois pound of pure water from
58.5 degrees Fahrenheit to 59.5 degrees Fahrenheit under standard pressure of 30
inches of mercury at or near its point of maximum density. This Agreement may
refer to volumes or quantities of Landfill Gas calculated as the actual heating value
of those volumes in MMBtu, rather than the actual volumes measured in standard
cubic feet.
1.7 Point of Delivery. That point immediately past the existing gas meter owned,
operated and maintained by Seller located near the Generators on the Premises, as
shown on Attachment "A".
1.8 Premises. The City of Fort Worth's Village Creek Wastewater Treatment
Plant, which is located at 4500 Wilma Lane, Arlington, Texas 76012.
II. SUBJECT MATTER AND QUANTITY
2.1 Seller shall sell and cause delivery of, and Buyer shall receive and pay for, a
supply of Landfill Gas for use only at the Premises for operation of the
Generators, all subject to the other terms and conditions of this Agreement.
2.2 Subject to the other terms and conditions of this Agreement, each month Buyer
shall purchase all of the Landfill Gas that is produced and captured in the Landfill
Gas Collection System and that Seller is physically able to deliver to the Point of
Delivery,'up to a maximum of 24,000 MMBtu per month. If more than 24,000
MMBtu in any one month is delivered to Buyer, Buyer shall have no obligation to
pay for any Landfill Gas in excess of 24,000 MMBtu.
2.3 Seller's obligation to deliver Landfill Gas, and Buyer's obligation to buy Landfill
Gas are limited by: (i) Force Majeure events in accordance with article X; (ii)
inability to burn Landfill Gas due to normal maintenance operations (planned and
unplanned) on the Premises (including both Generators) or on the Landfill
(including the Landfill Gas Collection System); and (iii) inability to burn Landfill
Gas due to the making.of repairs on both Generators. Without limiting the
foregoing provisions, the Parties expressly acknowledge that Buyer has no
obligation to buy Landfill Gas during periods in which both Generators are
undergoing maintenance or repairs, either on or off the Premises.
2.4 Seller will deliver the Landfill Gas at the Point of Delivery in as nearly a uniform
hourly and daily rate of flow as is practicable, subject to operating limitations of
the Landfill Gas Collection System.
2.5 Seller's ability to deliver Landfill Gas is currently limited to approximately
28,000 MMBtu per month because of the condition of the Landfill and the
Landfill Gas Collection System. It is possible that Seller may deliver more than
24,000 MMBtu to Buyer in any month; provided, however, as stated in sections
2.2 and 4.1, the Base Landfill Gas Price is based on 24,000 MMBtu per month
and Buyer shall have no obligation to pay for more than 24,000 MMBtu in any
month. It is anticipated that at some future date during the term of the
Agreement, Seller will be able to deliver more than 28,000 MMBtu of Landfill
Gas per month. Throughout the term of this Agreement, Buyer shall have a right
of first refusal with regard to any Landfill Gas produced in excess of 28,000
MMBtu per month that is not being utilized internally by Seller at the Landfill. In
the event Seller is able to produce more than 28,000 MMBtu per month ("Excess
Landfill Gas") and receives an offer to purchase the Excess Landfill Gas from a
third party(ies) that Seller desires to accept ("Offer"), Seller shall give Buyer
written notice ("Notice") of the terms and conditions of the Offer. Buyer shall
have five (5) business days from receipt of the Notice in which to agree to'
purchase the Excess Landfill Gas or part thereof on the same terms and conditions
set forth in the Offer. If Buyer does not respond in writing within such five (5)
business days, the Offer will be deemed to be refused by Buyer and Seller may
sell the Excess Landfill Gas to such third party(ies). Buyer may assign its rights
under this section 2.5 to City. Seller consents to Buyer's assignment of its right
under this section to.City.
2
III. TERM
Unless terminated earlier as provided in this Agreement, the Initial Term of this
Agreement shall commence on the date Buyer can take delivery of Landfill Gas
for use in at least one of the Generators, to be determined in Buyer's sole
discretion("Effective Date") and shall terminate on September 30, 2019.
N. PRICE
4.1 The price payable by Buyer to Seller for the Landfill Gas shall be $72,000 per
month for 24,000 MMBtu delivered by Seller (the "Base Landfill Gas Price").
If more than 24,000 MMBtu is delivered to Buyer in any one month, Buyer shall
have no obligation to pay for any Landfill Gas in excess of 24,000 MMBtu. The
Base Landfill Gas Price will be adjusted annually commencing October 1, 2006,
based on the Urban Wage Earner and Clerical Workers U.S. City Average
Consumer Price Index (the Adjusted Landfill Gas Price). The first annual
adjustment shall be limited to three and one-half percent (3 1/2%) over the Base
Landfill Gas Price. Each subsequent annual adjustment shall be limited to three
and one-half percent (3-1/2 %) over the most recent Adjusted Landfill Gas Price,
provided, however, the Adjusted Landfill Gas Price shall never exceed $4.50
during the term of this Agreement. In addition, Seller shall receive proceeds from
sale of Renewable Energy Credits from power generated from Landfill Gas, in
accordance with article V.
4.2 If the amount of Landfill Gas delivered by Seller is less than 24,000 MMBtu in
any month, the Base Landfill Gas Price will be reduced by$3.00/MMBtu for each
MMBtu delivered less than 24,000. Further, if Seller can deliver at least 24,000
MMBtu, but Buyer cannot take delivery of at least 24,000 MMBtu for use in the
Generators because of normal maintenance operations (planned and unplanned),
repairs or a Force Majeure event, as defined in article X, the price will be reduced
by $3.00/MMBtu for each such MMBtu less than 24,000. If the Base Landfill
Gas Price is subsequently adjusted pursuant to section 4.1, the Adjusted Landfill
Gas Price will be reduced by the adjusted MMBtu price if Seller delivers less than
24,000 MMBtu or Buyer cannot take delivery of at least 24,000 MMBtu in
accordance with this section.
V. RENEWABLE ENERGY CREDITS
5.1 The parties recognize that renewable energy credits ("RECs") may be created and
attributable to the use of Digester Gas and Landfill Gas in the Generators.
5.2 Buyer is responsible for distributing proceeds from sale of RECs to City and
Seller. Seller is responsible for all other matters relating to RECs, including
without limitation applying for (on behalf of City), qualifying for and selling the
RECs in accordance with this Agreement. Seller and Buyer will cooperate with
each other in the performance of their duties pursuant to this article.
5.3 Buyer shall distribute proceeds from the sale of RECs for power produced by
the Generators from Landfill Gas and Digester Gas, net of brokerage fees, and
SI 7
.• ..%r. Jia U�SC
provide an accounting of such distribution to Seller and City within thirty (30)
days after receipt of the funds, as follows:
(a) Reimburse Seller and Buyer for expenses pursuant to section 5.7 below;
(b) Pay any remaining Landfill Gas REC sales proceeds to Seller until the total
sales price received by Seller for Landfill Gas delivered by Seller and
accepted by Buyer for use in the Generators equals $3.55 (the "Effective
Landfill Gas Price"), subject to adjustment in accordance with section 5.4
below;
(c) Pay any remaining proceeds from the sale of Landfill Gas RECs greater than
the amount required to reach the Effective Landfill Gas Price to City and
Seller, in equal amounts; and
(d) Pay 100% of the proceeds from the sale of RECs attributable to Digester Gas
to City.
The following example assumes 24,000 MMBtu of Landfill Gas delivered
by Seller and accepted by Buyer in the month of April, 2005 and receipt
by Buyer of REC sales proceeds of$33,000 for electricity produced in
April, 2005, by burning Landfill Gas and Digester Gas in the Generators.
Buyer calculates % attributable to Landfill Gas and Digester Gas. Assume
for purposes of example 60% attributable to Landfill Gas ($19,800) and
40% attributable to Digester Gas ($13,200).
Buyer pays Seller$13,200 from Landfill Gas RECs to increase the
Effective Landfill Gas price to $3.55 per MMBtu($.55 x 24,000 MMBtu).
In addition, Buyer pays Seller$3,300 (50% of$6,600 Landfill Gas REC
balance), for a total payment to Seller of$16,500.
Buyer pays City $13,200 (REC proceeds attributable to Digester Gas)plus
$3,300 (50% of$6,600 Landfill Gas REC balance) or, at Buyer's option,
Buyer may deduct $16,500 from the next monthly invoice to City for
City's purchase of Landfill Gas from Buyer.
5.4 Whenever the Base Landfill Gas Price is increased in accordance with section 4.1,
the Effective Landfill Gas Price will be increased by the same amount, so that the
difference between the Adjusted Landfill Gas Price and the Effective Landfill Gas
Price in any month remains $.55/MMBtu.
5.5 If Landfill Gas displaces Digester Gas for use in the Generators, and the displaced
Digester Gas is flared, City will receive 100% of the payment for RECs
attributable to the Landfill Gas that displaced the flared Digester Gas, and no
payment will be made to Seller for such RSCS; provided, however, payment to
Seller for RECs shall be calculated based on not less than 24,000 MMBtu per
4
month or the volume of Landfill Gas made available by Seller for delivery,
whichever is less.
5.6 For any period during which RECs are not awarded, including without limitation
when Buyer determines in its sole discretion that it is advisable to burn natural gas
in the Generators, the total payment price to Seller will be the Base Landfill Gas
Price, subject to adjustment in accordance with section 4.1 and section 4.2. REC
proceeds shall not be used to increase payment to Seller for any month other than
the month for which the RECs are attributable.
5.7 In the event Buyer or Seller incurs expenses in connection with qualification for
or administration of RECs with the written consent of the other Parry, including
without limitation application or processing fees, purchase of equipment or
software, and retrofitting of existing equipment, and excluding expenses for time
expended by any person, including without limitation employees, independent
contractors and consultants, REC sales proceeds will be used to reimburse Buyer
and Seller before any REC sales proceeds are distributed to the parties. Neither
Buyer nor Seller will be reimbursed for an expense incurred without the other
Party's written consent. All software, equipment and other items purchased using
REC sales proceeds shall be Buyer's property and shall be returned to Buyer
within ten (10)business days after termination of the Agreement.
5.8 Seller shall not enter into any transaction for the sale of future RECs for a period
covering more than three months without Buyer's written approval of the sales
transaction. Seller shall copy Buyer on any documents filed with brokers or
governmental agencies and provide documentation of all sales transactions to City
within ten (10) business days after each transaction.
5.9 Within thirty (30) days after receipt of proceeds from the sale of RECs pursuant to
this Agreement, Seller shall provide an accounting of such RECS to Buyer in
form and substance satisfactory to Buyer.
VI. CALCULATION AND PAYMENT OF CHARGES
6.1 Seller will invoice Buyer as soon as reasonably practicable after the end of each
calendar month. Buyer will pay the invoiced amount not more than thirty (30)
days following the date the invoice is received. If Buyer in good faith disputes
any portion of Seller's invoice, Buyer will pay the undisputed portion within the
time stated above, and concurrently advise Seller in writing of the particulars of
such dispute. In the event that Buyer gives notice of such dispute, the parties
shall, for a period of thirty (30) calendar days following Seller's receipt of that
notice, pursue diligent, good faith efforts to resolve the dispute. Following
resolution of the dispute, any amount found payable shall be reflected in the next
month's invoice to Buyer and paid by the due date for such invoice. If Buyer fails
to pay any amount due, or if the Parties are unable to resolve a disputed invoice
during that thirty (30) day period, interest will accrue on the unpaid portion that is
subsequently found to have been payable at a rate equal to the lesser of: (i) three
percent above the "Prime Rate" as published in The Wall Street Journal under
"Money Rates," from time to time, or an appropriate substitute should su r
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cease to be published, or (ii) the highest rate allowed by law, from the date such
payment is due until the same is paid.
6.2 No party receiving proceeds under this Agreement may request any adjustment or
correction of any statement or payment unless written notice of such request for
adjustment or correction is furnished within two years after payment therefor has
been made.
6.3 Payments may be made by check, wire transfer, direct debit or electronic data
interchange, on terms acceptable to both Parties. Payment shall be made to the
address set out in article XI.
6.4 Seller shall submit an analysis of the Landfill Gas delivered during the previous
month to Buyer together with the invoice delivered pursuant to section 6.1.
VII. METERING EQUIPMENT
7.1 The Landfill Gas delivered hereunder will be measured by means of measuring
devices of standard type, which will be installed, operated and maintained by
Seller. Seller shall routinely test for accuracy, and service and calibrate if necessary,
the measuring devices during each twelve (12) month period. Copies of the results
of such calibration and all related information shall be provided to Buyer. Buyer
shall have access to the metering facilities at all reasonable times; provided,
however, that any reading, calibration or adjustment to such metering equipment
shall be done by employees or agents of Seller, or other mutually approved third
party calibration agent, in the presence of representatives of Seller and Buyer, if so
requested by Buyer. Notification of any proposed test shall be provided to Buyer at
least seventy-two (72) hours prior to such test being conducted and Buyer may
observe such test, if so desired. For the purpose of instrument and meter
calibration, the atmospheric pressure is assumed, unless otherwise established by
the Standard Gas Measurement Law,to be 14.4 prig.
7.2 Upon any calibration, if it is determined that the accuracy envelope of such meter is
found to be lower than ninety- eight percent (98%) or higher than one hundred two
percent (102%) expressed as a percentage of the full scale of the meter, the
registration of the flow as determined by such defective meter shall be corrected for
a period extending back to the time such inaccuracy began, if such time is
ascertainable; or, if such time is not ascertainable, then for a period extending back
six months. The meter will be properly sealed, and the seals shall not be broken
unless the other Party has been notified and given a reasonable opportunity to be
present.
7.3 If the meter is out of service or out of repair so that the amount of Landfill Gas
metered cannot be ascertained or computed from the reading thereof, the Landfill
Gas delivered during the period such meter is out of service or out of repair shall be
estimated and agreed upon by Buyer and Seller upon the basis of the best data
available. The basis for estimating such volume includes, but is not limited to,
extrapolation of past patterns of volume under similar conditions.
7.4 Seller shall keep all records from all measuring equipment on file for a period of
not less than three years, unless state or federal laws or regulations require a
longer retention period.
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7.5 Upon request, Seller shall make available to Buyer volume records from the
measuring equipment, together with calculations therefrom, for inspection and
verification, subject to return within thirty(3 0) days after receipt thereof.
7.6 Buyer may, at its option and expense, install and operate meters, instruments and
other equipment to verify the accuracy of Seller's measuring equipment, but such
equipment must not interfere with the operation of Seller's measuring equipment.
The check equipment installed by Buyer, if any, is subject at all reasonable times
to inspection or examination by Seller, but the calibration and adjustment thereof
may be performed only by employees or agents of Buyer. Notwithstanding
Buyer's right to install its own check equipment, the measurement of the gas-for
the purposes of this Agreement will be performed only by Seller's measuring
equipment.
7.7 Specific gravity and gross heating value of the Landfill Gas will be determined by
on-site sampling and off-site laboratory analysis. All samples will be taken in a ,
composite sampler that takes samples at least once per hour for one month during
the time gas was actually flowing through the system. The laboratory analysis will
yield an average specific gravity and gross heating value for the month. For the
purpose of measuring the gross heating value of the gas, the water vapor content
is the actual water vapor content of the gas as delivered to Buyer, but if the water
vapor content is seven pounds per million cubic feet or less, the gas is deemed to
be dry.
7.8 The meters for measurement of volumes of gas hereunder shall be installed and
operated, and gas measurement computations must be made, in accordance with
current industry standards. Orifice metering must be performed in accordance
with the latest version of A.G.A. Report No. 3 - ANSI/API 2530. Positive
displacement and rotary metering must be performed in accordance with the latest
version of ANSI B 109.1, B 109.2 or B 109.3. Ultrasonic metering must be
performed in accordance with the latest version of A.G.A. Report No. 9.
Electronic gas measurement must be performed in accordance with the latest
version of API Manual of Petroleum Measurement Standards Chapter 21 - Flow
Measurement Using Electronic Metering Systems.
7.9 The unit of measurement is one cubic foot at a pressure base of 14.65 psis and at a
temperature base of 60 degrees Fahrenheit. Meter measurements will be
computed by Seller into such units in accordance with the Ideal Gas Laws for
volume variations due to metered pressure and corrected for deviation using
average values of recorded specific gravity and flowing temperature, or by using
the calculated specific gravity determined by the method mentioned in section
7.8; provided, however, under no circumstance will the average value of flowing
temperature or specific gravity be determined for a period of less than one day.
7.10 In measurement computations,the determinations for the average values for meter
pressure, specific gravity and flowing temperature will be determined only during
periods when gas is actually flowing through the respective meter(s).
uG°? RAI?ll
7
VIII. GAS DELIVERY PRESSURE AND QUALITY
8.1 Seller will use reasonable efforts to deliver the Landfill Gas at the Point of
Delivery at an average pressure of 60 pounds per square inch, gauge ("psig
provided, however, that the pressure of the Landfill Gas delivered at the Point of
Delivery shall not exceed 65 psig or be below 55 psig. The Landfill Gas
delivered by Seller to Buyer shall also meet the following specifications:
(a) contains at least 45%by volume of methane;
(b) contains not more than 15 grains of total sulfur per 100 cubic feet of gas;
(c) contains not more than 1.4%by volume of oxygen;
(d) contains not more than a total of 10% by volume of all non-hydrocarbon
gases,other than carbon dioxide;
(e) contains a gross heating value of at least 450 Btus per cubic foot of gas, on
a water vapor dry basis at a temperature of 60 degrees Fahrenheit and at an
absolute pressure equivalent to 14.65 pounds per square inch absolute
("psia"); however, if the water vapor content is seven pounds per million
cubic feet or less,the Landfill Gas will be deemed dry;
(f) has a water or hydrocarbon dew point of not more than 40 degrees
Fahrenheit at a pressure equal to 60 psig; and
(g) has a stable heating value and specific gravity that will permit utilization
thereof in the Generators.
8.2-- EXCEPT FOR THE QUALITY -SPECIFICATIONS SET FORTH ABOVE,
SELLER DOES NOT MAKE ANY EXPRESS OR IMPLIED
REPRESENTATIONS OR WARRANTIES OF ANY KIND OR NATURE AS
TO THE LANDFILL GAS, INCLUDING, WITHOUT LMTATION, ANY
AND ALL REPRESENTATIONS AND/OR WARRANTIES AS TO THE
QUANTITY OF LANDFILL GAS, THE RATE AT WHICH SELLER CAN
PRODUCE AND/OR DELIVER LANDFILL GAS TO BUYER, THE
QUALITY OF THE LANDFILL GAS DELIVERED BY SELLER TO BUYER
PURSUANT TO THIS CONTRACT AND/OR SELLER'S ABILITY TO
DELIVER ANY LANDFILL GAS DURING THE ENTIRE TERM OF THIS
AGREEMENT; PROVIDED, HOWEVER, IF SELLER DELIVERS LESS
THAN 24,000 MMBTU IN ANY MONTH THE PRICE WILL BE ADJUSTED
IN ACCORDANCE WITH SECTION 4.2. THE PARTIES AGREE THAT ANY
IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE AND ALL OTHER WARRANTIES, EXPRESS OR
HvIPLIED, ARE EXCLUDED FROM THIS TRANSACTION AND DO NOT
APPLY TO ANY LANDFILL GAS SOLD HEREUNDER.
8.3 Except in accordance with this paragraph, Buyer shall not be obligated to
purchase any Landfill Gas that does not meet the specifications set forth in section
8.1. In the event Seller determines that Landfill Gas does not comply with the
requirements of section 8.1, Seller shall promptly notify Buyer of the na
extent of the noncompliance b telephone and b facsimile or e- " ' ' ' -
P Y P Y �--�_��1c � �:�l�C���
accordance with article M. If Buyer uses any Landfill Gas after receivi g'v ? �`^'?�,
I �.�+t�l�I�! I I �?
8
oral and written notices, then Buyer shall to be deemed to have waived its
objections to the noncompliance of which Buyer received notice, and shall be
obligated to pay for the Landfill Gas taken at the price set forth in this Agreement.
8.4 Buyer shall not be obligated to purchase any Landfill Gas that in Buyer's
reasonable opinion, supported by substantial evidence provided to Seller, will
cause injury to or interference with the proper utilization of the Generators.
IX. TERMINATION OF AGREEMENT
9.1 A party may terminate this Agreement upon written notice prior to the expiration
of its term, without prejudice to any other right it may have under this Agreement,
if the other Party commits a material breach of the terms hereof. Prior to
termination, the non-breaching Party shall provide the breaching Party with
written notice that describes the breach in reasonable detail. The breaching Party
must commence curing such breach within fourteen (14) calendar days after the
time the breaching Party receives such written notice and complete the cure
within fourteen(14) calendar days from the date of commencement of the cure. If
the breaching Party does not substantially cure such breach within the stated
period of time, the non-breaching Party may, in its sole discretion, and without
prejudice to any other right under this Agreement, law, or equity, terminate this
Agreement by giving written notice to the breaching Party; provided, however, if
the breach is not reasonably susceptible to cure by the breaching Party within the
time stated in the notice, the non-breaching Party shall not exercise its option to
terminate this Agreement so long as-the breaching Party has commenced to cure
the default within the stated time period and diligently completes the work within
a reasonable time without unreasonable cessation of the work to complete the
cure. Buyer shall provide copies of default and termination notices to Seller's
lender(s) in accordance with section 15.04.
9.2 The Parties acknowledge that Buyer is purchasing Landfill Gas from Seller for the
benefit of City in connection with operation of the Generators on the Premises, in
accordance with a gas supply agreement executed by Buyer and City(Exhibit"A"
to City Secretary Contract No. 31532). In the event City does not appropriate
sufficient money to pay Buyer for Landfill Gas pursuant to Exhibit "A" to City
Secretary Contract No. 31532 for any fiscal year of City during which this
Agreement is in effect, then this Agreement will terminate at the end of the most
recent fiscal year for which funds had been appropriated for City to purchase
Landfill Gas from Buyer. For purposes of this Agreement, City's fiscal year is
October 1 through September 30 ("Fiscal Year"). Buyer shall notify Seller of
City's failure to appropriate funds to purchase Landfill Gas from Buyer, before
the end of City's Fiscal Year.
9.3 If City terminates City Secretary Contract No. 31532 to purchase Landfill Gas
from Buyer on the grounds of material breach of such agreement by Buyer, non-
appropriation of funds by City, or cessation of operation and management of the
Generators by Buyer, Buyer may terminate this Agreement as of the same
termination date as Contract No. 31532.
9
X. FORCE MAJEURE
If either Party is unable to perform its obligations in whole or in part due to an event of
Force Majeure as defined herein, then the obligations of the affected Party shall be
suspended to the extent made necessary by such event, provided that (i) the non-
performing Party, within two weeks after the occurrence of the Force Majeure, gives the
other Party written notice describing the particulars of the occurrence; (ii) the suspension
of the performance be of no greater scope and of no longer duration than is required by
the Force Majeure; (iii) no obligations of either Party that arose prior to the occurrence
causing the suspension of performance be excused as a result of the occurrence; and (iv)
the non-performing Party will use reasonable efforts to remedy with all reasonable
dispatch the cause or causes preventing it from carrying out its obligations. The term
"Force Majeure" means any cause not within the control of the Party claiming relief,
including, but not limited to, acts of God; governmental authority; civil disorder; strikes
or labor disputes; failure, repair or change of or obstruction in the Landfill Gas Collection
System or both Generators; depletion or failure of Landfill Gas supply; an event of Force
Majeure of the transporter of the Landfill Gas; breakdown of both Generators; or any
other cause that by the exercise of reasonable diligence such Party could not have
prevented or is unable to overcome. It is understood and agreed that the settlement of
strikes or lockouts will be entirely within the discretion of the Party having the difficulty,
and that the above requirements of the use of diligence in restoring normal operating
conditions will not require the settlement of strikes or lockouts by acceding to the terms
of the opposing party when such course is inadvisable in the discretion of the Party
having the difficulty. Neither financial distress nor the inability of either Party to make a
profit or avoid a financial loss shall be deemed a Force Majeure event, unless caused by
one of the foregoing factors.
XI. NOTICES
11.1 Unless otherwise provided herein, all notices required or permitted under this
Agreement shall be in writing and shall be deemed to be delivered when
deposited in the United States mail (registered or certified), postage prepaid, or
when deposited with an overnight delivery service, prepaid, to the addresses
shown below, or to such address as any Party may from time to time designate as
the address, or in the case of hand delivery, when delivered to a representative of
a Party by a representative of any other Party; provided, however, except for
payments of amounts due hereunder, a Party may provide such items hereunder
by facsimile to the other Parties.
If to Buyer: If to Seller:
Renda Environmental, Inc. Renovar Energy Corp.
2501 Greenbelt Road 601 N. Marienfeld, Suite 300
Fort Worth, Texas 76118 Midland, Texas 79701
Facsimile: (817) 571-6783 Facsimile: (432) 685-3704
10
A copy of any notice to any Party hereunder shall also be delivered to the City of
Fort Worth and shall be addressed to:
Director
Fort Worth Water Department
1000 Throckmorton
Fort Worth, Texas 76102
Facsimile: (817) 392- 8195
Plant Engineer
Village Creek Wastewater Treatment Plant
4500 Wilma Lane
Arlington, Texas 76012
Facsimile: (817) 548-5758
11.2 Notice of noncompliant Landfill Gas pursuant to section 8.3 shall be given by
telephone to both telephone numbers and by either e-mail or facsimile to Buyer's
representative as follows:
Jim Fitzgerald
Telephone: (817) 571-9391 and(817) 401-1719
E-mail: ifitzgerald(a)_rendaenvironmentalcom
Facsimile: (817) 571-6783
Buyer may designate another contact person or revise the information set out
above at any time by notifying Seller in writing.
XII. RESPONSIBILITY
12.1 As between the Parties, Seller will be in exclusive control of the Landfill Gas
delivered hereunder and responsibility for any damages or injuries to persons or
property caused thereby until the gas is delivered to Buyer at the Point of
Delivery. Seller hereby agrees to indemnify, defend and hold harmless Buyer and
City and each of their successors, assigns, elected officials, partners, agents,
representatives, consultants, contractors, attorneys and employees (collectively,
"Indemnitees") from any damages or injuries to persons or property caused
thereby while the gas is in Seller's control, except damages and injuries
attributable to the negligence or fault of Buyer and/or City or its agents.
12.2 After such delivery of gas at the Point of Delivery, Buyer will be deemed to be in
exclusive control thereof and responsible for any damages or injuries to persons
or property caused thereby, and hereby indemnifies and holds Seller harmless
from any damages or injuries to persons or property caused thereby while the
same is in Buyer's control, except damages and injuries attributable to the
negligence or fault of Seller or its agents or failure to meet the Landfill Gas
specifications and quality requirements of Section 8.1 of this Agree qt,. r , , o
pa pw, u;
L .
11
12.3 Seller hereby indemnifies and holds Buyer harmless from any damages or injuries
to persons or property caused by failure to meet the Landfill Gas specifications
and quality requirements of section 8.1 of this Agreement.
M. TAXES
Seller will pay all production, severance, gathering and other taxes, if any, attributable to
the Landfill Gas until it is delivered to Buyer pursuant to this Agreement. Buyer will pay
all taxes, if any, attributable to the Landfill Gas after it is delivered at the Point of
Delivery.
XIV. INSURANCE
Seller shall, at its sole expense,provide and maintain in effect at all times during the term
of this Agreement insurance coverages as set forth in Attachment`B"to this Agreement.
XV. AUDIT
Seller agrees that Buyer shall, until the expiration of three (3) years after final payment
under this Agreement, have access to and the right to examine any directly pertinent
books, documents, papers and records of Seller involving transactions relating to this
Agreement. Seller agrees that Buyer shall have access during normal working hours to
all necessary facilities of Seller and shall be provided adequate and appropriate
workspace in order to conduct audits in compliance with the provisions of this section.
Buyer shall give Seller reasonable advance notice of intended audits. Seller agrees to
photocopy such documents as may be requested by Buyer. Buyer agrees to reimburse
Seller for the costs of copies at the applicable rate published in Texas Administrative
Code, Chapter 111, Subchapter C, Rule 116.63, or as subsequently recodified.
XVI. LENDER'S RIGHTS
16.01 For purposes of this article, "Facilities" means that portion of the Landfill Gas
Collection System owned by Seller including but not limited to the gas
compression and dehydration facilities and related equipment, pipelines from the
Landfill to the Premises, and measurement equipment. Seller may encumber,
mortgage, lease or hypothecate to any person or entity providing equity or debt
financing ("Lender") by deed of trust or mortgage or other security instrument all
or any part of Seller's interest in the Facilities, Facilities equipment, or
appurtenant facilities, property rights, and interests of Seller under this
Agreement. Seller may also assign, pledge, and set over to any Lender all rights
of Seller in this Agreement, any other agreement regarding the Facilities, and any
governmental authorization, permit, or license regarding the Facilities. No such
assignments or hypothecations shall relieve any obligation of Seller under this
Agreement.
16.02 In addition to any other right provided to any Lender by other provisions of this
Agreement, any Lender shall have the right at any time during the term of this
Agreement to: (i) do or cause to be done any act or thing required of Seller under
12
this Agreement, and any such act or thing performed or caused to be performed
by such Lender shall have the effect of having been done by Seller itself, (ii)
realize on the security afforded such Lender by taking possession of all or any
portion of the Facilities owned by Seller and/or exercising foreclosure
proceedings or power of sale or other remedy afforded in law or in equity or by
security documents assigned to or entered into by the Lender, and (iii) subject to
the restrictions noted in section 16.03, transfer, convey, or assign the interests of
Seller under this Agreement to any purchaser at any foreclosure or secured parry
sale, whether such sale be conducted pursuant to court order, power of sale
contained in the Lender mortgage or applicable law, and to acquire and succeed to
the interest of Seller under this Agreement by virtue of any foreclosure or secured
party sale, whether such sale be conducted pursuant to a court order, a power of
sale contained in the Lender mortgage, or applicable law, or by virtue of a deed
and/or bill of sale and assignment in lieu thereof. Buyer shall grant any Lender or
its authorized designee immediate access to the Facilities to the extent necessary
to remedy any breach or default of Seller under this Agreement or in exercise of
the Lender's remedies under any security document. If Lender(s) are prohibited
by any bankruptcy, insolvency, or judicial proceeding from commencing
foreclosure proceedings or other actions to preserve their secured interest(s) in the
Facilities and this Agreement, any right of Buyer to terminate this Agreement
shall be suspended for so long as the Lender(s) diligently pursue such proceedings
and cure any default in the payment of monies due Buyer or City; provided,
however, nothing herein affects termination of the Agreement in the event of non-
appropriation of funds pursuant to section 9.2.
16.03 If any Lender or other third party acquires Seller's interests under this Agreement
as aforesaid in section 16.02, such Lender or other third parry shall accept in
writing, and shall without further action be subject to, the same terms and
conditions set forth in this Agreement, and shall be required to immediately cure
all defaults or breaches of Seller under this Agreement. No such assignment shall
be effective without the consent of Buyer, such consent not to be unreasonably
withheld.
16.04 Buyer shall provide any Lender(s) with copies of all default and termination
notices required to be given to Seller under section 9.1 of this Agreement
simultaneously with the forwarding of such notice to Seller. No such notice shall
be deemed effective absent the providing of a simultaneous copy to Lender.
Seller shall designate in writing the Lender(s) and shall provide to Buyer in
writing the names and addresses of such Lender(s). Failure of Seller to provide
names and addresses of Lender(s) shall relieve Buyer from the notice obligation
of this paragraph as to the omitted Lender.
16.06 Any right of the Lender to obtain a successor to assume Seller's obligations under
this Agreement is subject to the requirement that Buyer must be reasonably
satisfied as to the qualifications of any successor, which will require at a
minimum that any successor have at least three (3) years' experience in the
operation of such Landfill Gas projects.
13
XVII. MISCELLANEOUS
17.1 Regulatory and Legislative Bodies. This Agreement is subject to all applicable
laws, regulations, rules and orders of all regulatory and legislative bodies now or
hereafter having jurisdiction over either party, or the Landfill Gas covered
hereunder.
17.2 Governing Law; Jurisdiction and Venue. This Agreement shall be governed by
and construed in accordance with the laws of the State of Texas, as it applies to
contracts performed within the State of Texas and without regard to any choice of
law rules or principles to the contrary. The parties acknowledge that this
Agreement is performable in Tarrant County, Texas and hereby submit to the
exclusive jurisdiction of the state courts of Tarrant County, and hereby agree that
any such court shall be a proper forum for the determination of any dispute arising
hereunder.
17.3 Assignment. Except as expressly provided herein, this Agreement may not be
transferred or assigned by a Party without the written consent of the other Party,
which consent shall not be unreasonably withheld. Buyer or Seller may assign
this Agreement without the other's consent to (i) any limited liability corporation,
partnership, limited partnership, corporation or other entity owned or controlled in
whole or in part by the Assignor; or (ii) a lending institution pursuant to a
collateral assignment, provided that any such assignee agrees to be bound by the
terms of this Agreement to the same extent as the Assignor.
17.4 Entiretof Agreement. It is the intention of the Parties that this Agreement
supersedes all prior agreements regarding sale and purchase of Landfill Gas,
whether written or oral. This Agreement may not be modified or amended except
in writing, duly executed by the Parties hereto. The Parties hereby waive all
claims relating to Landfill Gas that accrued prior to the execution of this
Agreement. Each Party to this Agreement releases all other Parties from any
claim or cause of action that accrued prior to the execution of this Agreement.
17.5 Waiver of Rights. A waiver by a Party of any breach of this Agreement, or the
failure of a Party to enforce any of the terms and provisions of this Agreement,
will not in any way affect, limit, or waive that Party's right to enforce and compel
strict compliance with the same or other terms or provisions of this Agreement.
17.6 Third Party Rights. Nothing in this Agreement shall create, or be construed as
creating, any express or implied rights in any person or entity other than the
Parties.
17.7 Survival. No termination or cancellation of this Agreement will relieve either
Party of any obligations under this Agreement that by their nature survive such
termination or.cancellation, including, but not limited to payment obligations
arising before the termination date, warranties, obligations of indemnity, and
corrections to statements and payments hereunder.
17.8 Further Assurances. Buyer and Seller agree to provide such information, execute
and deliver any instruments and documents and to take such other actions as may
be necessary or reasonably requested by the other Party which are not inconsistent
with the provisions of this Agreement and which do not involve the assumption of
14
obligations other than those provided for in this Agreement, in order to give full
effect to and carry out the intent of this Agreement.
17.9 Invalidity. If any term or provision herein contained is held to be invalid by any
court of competent jurisdiction, the invalidity of such term or provision shall in no
way affect any other term or provision contained herein; further, this Agreement
shall then continue as if such invalid term or provision had not been contained
herein.
17.10 Contract Construction. The parties acknowledge that each parry and, if it so
chooses, its counsel have reviewed and revised this Agreement and that the
normal rule of construction to the effect that any ambiguities are to be resolved
against the drafting party shall not be employed in the interpretation of this
Agreement or any amendments or exhibits hereto.
17.11 Counterparts. This Agreement may be executed in several identical counterparts,
and by the Parties on separate counterparts, and each counterpart, when so
executed and delivered, will constitute but one and the same Agreement.
17.12 No Joint Venture Partnership, Agency. This Agreement will not be construed in
any form or manner to establish a partnership,joint venture or agency, express or
implied, nor any employer-employee, borrowed servant or joint enterprise
relationship by and among the Parties. Buyer and Seller are each independent
contractors and each shall be responsible at all times for directing its employees in
the course of their duties.
THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.
15
17.13 RELEASE. EACH PARTY ITSELF, AND ON BEHALF OF ITS RESPECTIVE
SUCCESSORS, ASSIGNS, LEGAL REPRESENTATIVES, LENDERS, TRANSFEREES,
HEIRS, AND AGENTS, HEREBY RELEASES, ACQUITS AND FOREVER DISCHARGES
EACH OF THE OTHER PARTIES AND THEIR RESPECTIVE DIRECTORS, OFFICERS,
STOCKHOLDERS, PARTNERS, AFFILIATED COMPANIES, ELECTED OFFICIALS,
EMPLOYEES, AGENTS, ATTORNEYS, CONSULTANTS, CONTRACTORS, SUCCESSORS
AND ASSIGNS AND ANY AND ALL PERSONS OR ENTITIES THAT MAY BE RELATED
TO EACH OR ANY OF THEM, WHETHER OR NOT NAMED HEREIN (COLLECTIVELY,
"RELEASEES") OF AND FROM ANY AND ALL CLAIMS, DEMANDS, CAUSES OF
ACTION, AFFIRMATIVE DEFENSES, ATTORNEYS' FEES AND COSTS, OF EVERY
KIND AND NATURE WHATSOEVER RELATING TO LANDFILL GAS, WHETHER NOW
KNOWN OR UNKNOWN, LEGAL, EQUITABLE, STATUTORY OR OTHERWISE
("CLAIMS"), THAT ACCRUED PRIOR TO THE EXECUTION OF THIS AGREEMENT,
EVEN IF SUCH CLAIMS ARISE FROM OR ARE ATTRIBUTED TO STRICT LIABILITY
OR THE SOLE OR CONCURRENT NEGLIGENCE OF ANY RELEASEE.
Signed in triplicate, each of which is deemed an original, on this LW/—day of April,
2005.
RENOV E G CORP.
By:
wrence i ert, resident -
RENDA ENVIRONMENTAL, INC.
r
By:
Raquel Giovanna, Chief Operations Officer
ATTEST:
C 4pote Secretary
16
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INSURANCE
Attachment B
Seller shall, at its sole expense, maintain in effect at all times during the term of this
Agreement and as otherwise required hereunder, insurance coverages with limits not less than
those set forth below with insurers licensed to do business in Texas and acceptable to Buyer and
City under forms of policies satisfactory to Buyer and City. The requirements contained herein
as to types, limits or Buyer and City's approval of insurance coverage to be maintained by Seller
are not intended to and shall not in any manner limit, qualify or quantify the liabilities and
obligations assumed by Seller under this Agreement or otherwise provided by law.
1. Coverage Minimum Amounts and Limits
A. Workers' Compensation.
Workers' Compensation Statutory Limits
Employer's Liability $500,000 disease-policy limit
$100,000 disease-per each employee
$100,000 each accident\occurrence
This policy shall include a Waiver of Subrogation in favor of the Indemnitees (as defined in this
Agreement).
B. Commercial General Liability.
Bodily Injury/ $1,000,000 each occurrence, or
Property Damage equivalent, subject to a
(Occurrence Basis) $2,000,000 aggregate applicable
to the services performed under this
Agreement
This policy shall be endorsed to include the Indemnitees as additional insureds, contain cross-
liability and severability of interest endorsements, which state that this insurance is primary
insurance as regards any other insurance carried by any Indemnitee, and shall include the
following coverages:
(1) Premises/Operations;
(2) Independent Contractor;
(3) Completed Operations for a period of three years following the
date of the completion of the services performed under the Agreement;
(4) Broad Form Contractual Liability specifically in support of, but not
limited to,the Indemnity sections of this Agreement;
(5) Broad Form Property Damage;
(6) Personal Injury Liability with employee and contractual exclusions
removed; and
(7) Delete Exclusions relative to Collapse, Explosion and
Underground Property Damage.
C. Automobile Liability.
(1) Bodily Injury/ $250,000 per person
$500,000 per occurrence
(2) Property Damage $100,000 per occurrence, or
equivalent
This policy shall be on a standard form written to cover all owned, hired and non-
owned automobiles. The policy shall be endorsed to include the Indemnitees as additional
insureds, contain cross-liability and severability of interest endorsements, which state that this
insurance is primary insurance as regards any other insurance carried by any Indemnitee.
D. Umbrella Excess Liability Insurance.
Bodily Injury $5,000,000 per occurrence
Property Damage $5,000,000 aggregate
(Occurrence Basis)
This policy shall be written on a following form umbrella excess basis
above the coverages described in A, B and C above, and shall be endorsed to include the
Indemnitees as additional insureds.
E. Seller's Pollution Liability Insurance.
Seller shall provide and maintain, at Seller's expense, Pollution Liability
Insurance Coverage (which shall contain no exclusions for asbestos or other types of pollution
liability)in an amount not less than $2,000,000 per occurrence. The Pollution Liability
Insurance policy must be written on a standard form and endorsed to include the Indemnitees as
additional insureds, contain cross-liability and severability of interest endorsements, and state
that this insurance will be primary insurance as regards any other coverage the Indemnitees may
have.
2. Other Requirements.
(a) Evidence of the foregoing insurance coverage required to be maintained
by Seller,represented by Certificates of Insurance issued by the insurance carrier(s), must be
furnished to Buyer and City. Certificates of Insurance shall specify the additional insured status
mentioned above as well as the waivers of subrogation. Such Certificates of Insurance shall state
that Buyer and City will be notified in writing sixty (60) days prior to cancellation, material
change, or non-renewal of insurance. Seller shall provide to Buyer and City a certified copy of
any and all applicable insurance policies upon request of Buyer or City. Timely renewal
certificates will be provided to Buyer and City as the coverage renews.
(b) Insurance similar to that required of Seller shall be provided by or on
behalf of all Subcontractors to cover their operations performed under this Agreement. Seller
2
shall be held responsible for any modifications in these insurance requirements as they apply to
Subcontractors. Seller shall maintain Certificates of Insurance from all Subcontractors,
enumerating, among other things,the waivers in favor of, and insured status of,the Indemnitees,
as required herein, and make them available to Buyer and City upon request. The term
"Subcontractors(s)" as used throughout this Agreement shall include subcontractor(s) of any tier.
(C) SELLER HEREBY RELEASES,AND SHALL CAUSE ITS INSURERS,ITS
SUBCONTRACTORS,AND THEIR INSURERS TO RELEASE CITY,BUYER AND THE OTHER
INDEMNITEES FROM ANY AND ALL CLAIMS OR CAUSES OF ACTION WHATSOEVER WHICH
SELLER,ITS INSURERS,ITS SUBCONTRACTORS AND/OR THEIR INSURERS MIGHT OTHERWISE
POSSESS RESULTING IN OR FROM OR IN ANY WAY CONNECTED WITH ANY LOSS COVERED OR
WHICH SHOULD HAVE BEEN COVERED BY INSURANCE,INCLUDING THE DEDUCTIBLE PORTION
THEREOF,MAINTAINED AND/OR REQUIRED TO BE MAINTAINED BY SELLER AND/OR ITS
SUBCONTRACTORS PURSUANT TO THIS AGREEMENT,EVEN IF SUCH CLAIMS OR CAUSES OF
ACTION ARISE FROM OR ARE ATTRIBUTED TO THE SOLE OR CONCURRENT NEGLIGENCE OF ANY
INDEMNITEE OR FROM STRICT LIABILITY.
3
INSURANCE
Attachment C
Contractor shall, at its sole expense, maintain in effect at all times during the term of this
Agreement and as otherwise required hereunder, insurance coverages with limits not less than
those set forth below with insurers licensed to do business in Texas and acceptable to City and
under forms of policies satisfactory to City. The requirements contained herein as to types,
limits or City's approval of insurance coverage to be maintained by Contractor are not intended
to and shall not in any manner limit, qualify or quantify the liabilities and obligations assumed
by Contractor under this Agreement or otherwise provided by law.
1. Coverage Minimum Amounts and Limits
A. Workers' Compensation.
Workers' Compensation Statutory Limits
Employer's Liability $500,000 disease-policy limit
$100,000 disease-per each employee
$100,000 each accident\occurrence
This policy shall include a Waiver of Subrogation in favor of the Indemnitees (as defined in this
Agreement).
B. Commercial General Liability.
Bodily Injury/ $1,000,000 each occurrence, or
Property Damage equivalent, subject to a
(Occurrence Basis) $2,000,000 aggregate applicable
to the services performed under this
Agreement
This policy shall be endorsed to include the Indemnitees as additional insureds, contain cross-
liability and severability of interest endorsements, which state that this insurance is primary
insurance as regards any other insurance carried by any Indemnitee, and shall include the
following coverages:
(1) Premises/Operations;
(2) Independent Contractors;
(3) Completed Operations for a period of three years following the
date of the completion of the services performed under the Agreement;
(4) Broad Form Contractual Liability specifically in support of, but not
limited to,the Indemnity sections of this Agreement;
(5) Broad Form Property Damage;
(6) Personal Injury Liability with employee and contractual exclusions
removed; and
(7) Delete Exclusions relative to Collapse, Explosion and
Underground Property Damage.
C. Automobile Liability.
$1,000,000 each accident on a combined single limit basis
or
$250,000 Property Damage
$500,000 Bodily injury per person per occurrence
This policy shall be on a standard form written to cover all owned, hired and non-
owned automobiles. The policy shall be endorsed to include the Indemnitees as additional
insureds, contain cross-liability and severability of interest endorsements, and state that this
insurance is primary insurance as regards any other insurance carried by any Indemnitee.
D. Boiler and Machinery Coverage
Property damage. Minimum limit that will be maintained shall be $1.5 million
with consequential damages limit of$1,000,000. Coverage shall be location specific at 4500
Wilma Drive, Fort Worth, Texas co-generation facility.
E. Umbrella Excess Liability Insurance.
Bodily Injury $5,000,000 per occurrence
Property Damage $5,000,000 aggregate
(Occurrence Basis)
This policy shall be written on a following form umbrella excess basis
above the coverages described in A, B and C above, and shall be endorsed to include the
Indemnitees as additional insureds.
F. Professional Liability.
Contractor agrees to provide and maintain, at its expense, a Professional
Liability Insurance Policy (which shall contain no exclusions for asbestos or pollution liability)
of$2 million for a period not less than two (2) years after the date of the completion of the
services performed pursuant to this Agreement. Contractor shall provide City with a copy of the
terms and conditions of the policy providing Professional Liability coverage.
G. Contractor's Equipment Policy.
Any such insurance policy covering Contractor's or any Subcontractors'
equipment against loss by physical damage shall include an endorsement waiving the insurer's
right of subrogation against the Indemnitees. Such insurance shall be Contractor's and any
Subcontractors' sole and complete means of recovery for any such loss. SHOULD CONTRACTOR
OR ANY SUBCONTRACTOR CHOOSE TO SELF INSURE THIS RISK,IT IS EXPRESSLY AGREED THAT
CONTRACTOR AND SUCH SUBCONTRACTORS HEREBY WAIVE ANY CLAIM FOR DAMAGE OR LOSS
TO SAID EQUIPMENT IN FAVOR OF THE INDEMNITEES,EVEN IF SUCH DAMAGE OR LOSS ARISES
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FROM OR IS ATTRIBUTED TO THE SOLE OR CONCURRENT NEGLIGENCE OF ANY INDEMNITEE OR
FROM STRICT LIABILITY.
H. Contractor's Pollution Liability Insurance.
Contractor shall provide and maintain, at Contractor's expense, Pollution
Liability Insurance Coverage (which shall contain no exclusions for asbestos or other types of
pollution liability) in an amount not less than$2,000,000 per occurrence. The Pollution Liability
Insurance policy must be written on a standard form and endorsed to include the Indemnitees as
additional insureds, contain cross-liability and severability of interest endorsements, and state
that this insurance will be primary insurance as regards any other coverage the Indemnitees may
have.
2. Other Requirements.
(a) Evidence of the foregoing insurance coverage required to be maintained
by Contractor,represented by Certificates of Insurance issued by the insurance carrier(s), must
be furnished to the City. Certificates of Insurance shall specify the additional insured status
mentioned above as well as the waivers of subrogation. Such Certificates of Insurance shall state
that City will be notified in writing sixty(60) days prior to cancellation, material change, or non-
renewal of insurance. Contractor shall provide to City a certified copy of any and all applicable
insurance policies upon request of City. Timely renewal certificates will be provided to City as
the coverage renews.
(b) Insurance similar to that required of Contractor shall be provided by or on
behalf of all Subcontractors to cover their operations performed under this Agreement.
Contractor shall be held responsible for any modifications in these insurance requirements as
they apply to Subcontractors. Contractor shall maintain Certificates of Insurance from all
Subcontractors, enumerating, among other things,the waivers in favor of, and insured status of,
the Indemnitees, as required herein, and make them available to City upon request. The term
"Subcontractor(s)" as used throughout this Agreement shall include subcontractors of any tier.
(C) CONTRACTOR HEREBY RELEASES,AND SHALL CAUSE ITS INSURERS, ITS
SUBCONTRACTORS, AND THEIR INSURERS TO RELEASE CITY AND THE OTHER INDEMNITEES
FROM ANY AND ALL CLAIMS OR CAUSES OF ACTION WHATSOEVER WHICH CONTRACTOR, ITS
INSURERS, ITS SUBCONTRACTORS AND/OR THEIR INSURERS MIGHT OTHERWISE POSSESS
RESULTING IN OR FROM OR IN ANY WAY CONNECTED WITH ANY LOSS COVERED OR WHICH
SHOULD HAVE BEEN COVERED BY INSURANCE,INCLUDING THE DEDUCTIBLE PORTION
THEREOF,MAINTAINED AND/OR REQUIRED TO BE MAINTAINED BY CONTRACTOR AND/OR ITS
SUBCONTRACTORS PURSUANT TO THIS AGREEMENT, EVEN IF SUCH CLAIMS OR CAUSES OF
ACTION ARISE FROM OR ARE ATTRIBUTED TO THE SOLE OR CONCURRENT NEGLIGENCE OF ANY
INDEMNITEE OR FROM STRICT LIABILITY.
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City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 6/29/2004
DATE: Tuesday, June 29, 2004
LOG NAME: 60RENDA REFERENCE NO.: C-20131
SUBJECT:
Authorize Settlement Agreement with Lone Star Energy Services and Exercise the Second Five
Year Renewal Option to the Solids Dewatering, Processing and Disposal Contract with Renda
Environmental, Inc. for the Village Creek Wastewater Treatment Plant with Amendments
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City Manager to execute the settlement agreement with Lone Star Gas Energy Services
Company/TXU Energy Services Company.
2. Authorize the City Manager to execute the second five-year renewal to the Solids Dewatering,
Processing and Disposal Contract with Renda Environmental, Inc. (City Secretary Contract No. 20283), with
adjusted quantities to reflect actual daily solids production and an annual CPI calculation; and
3. Authorize the City Manager to execute an amendment to City Secretary Contract No. 20283 to include:
a. The operation and maintenance of the Village Creek Wastewater Treatment Plant (VCWWTP) five
MW turbine generators; and
b. The terms for the purchase of supplemental gas as an additional fuel source for the VCWWTP
turbine generators, consistent with the terms of the settlement agreement.
DISCUSSION:
On December 12, 2000 (M&C C-18397), the City Council authorized the execution of a long-term contract
with Lone Star Gas Energy Services, Inc., for the operations and maintenance of the two-five Megawatt
(MW) turbine generators at the Village Creek Wastewater Treatment Plant. This contract was terminated
effective December 31, 2003. Two temporary letter agreements have allowed continued operation until
June 30, 2004. Renda Environmental, Inc., formerly known as Oscar Renda Contracting, Inc., has
proposed to operate these turbine generators as part of its contract. The contract amendment will reduce
the current turbine generator operating costs from $77,000 to $60,000 per month.
On January 11, 2001 (M&C C-18877), the City Council authorized the execution of a long-term contract
with Lone Star Energy Services, Inc., a subsidiary of TXU, for the purchase of landfill gas produced at the
Arlington Landfill as an additional fuel source for the VCWWTP Turbine Generators. As part of a mediated
settlement with TXU, this contract will be terminated effective June 30, 2004. Renda Environmental, Inc.,
has proposed to contract with Renovar (Landfill Gas Owner) to supply landfill gas to the City as an
additional fuel for the VCWWTP turbine generators. The proposed contract amendment with Renda
Environmental, Inc. will reduce the current fuel costs from an average of $163,000 per month to a not-to-
exceed cost of$132,500. The May 2004 cost for landfill gas was $173,000.
Logname: 60RENDA Pagel of 3
On April 5, 1994 (M&C C-14255R), the City Council authorized execution of a Solids Dewatering
Processing and Disposal contract with Oscar Renda Contracting, Inc./Agronomic Management Group, Inc.,
now known as Renda Environmental, Inc., at the VCWWTP. On January 25, 2000 (M&C C-17834), the
City Council authorized the first five-year renewal and two additional five-year renewal options. Throughout
the duration of the contract, the contractor operated without interruption and in full regulatory compliance.
As part of the renewal negotiation, City Staff requested Renda Environmental, Inc., to amend the current
contract and to begin the renewal term on June 30, 2004. This amendment will reduce biosolids average
handling cost of$420,000 per month to an average of$390,000 per month.
Staff recommends the exercise of the second option to renew the Long-Term Solids Dewatering,
Processing and Disposal contract with Renda Environmental, Inc. to include:
1) A five-year, nine month (69 months) agreement at the proposed cost of $134.97/Dry Ton, with an
annual CPI adjustment, not to exceed the current yearly and total contract caps on price increases (3.5%
and 15%, respectively). This amendment will reduce biosolids average handling cost of $420,000 per
month to an average of$390,000 per month.
2) The operation and maintenance of the two-five MW turbine generators and heat recovery system at
the VCWWTP for a cost of $60,000 per month with an annual CPI adjustment, not to exceed the current
yearly and total contract caps on price increases (3.5% and 15%, respectively). The contract amendment
will reduce the current turbine generator operating costs from $77,000 to $60,000 per month.
3) Terms for the purchase of supplemental gas as an additional fuel source for the generators at a cost
not to exceed $132,500 per month with an annual CPI adjustment, not to exceed the current yearly and
total contract caps on price increases (3.5% and 15%, respectively). The contract amendment will reduce
the current fuel costs from an average of$163,000 per month to a not-to-exceed cost of$132,500.
Quantities and costs for the renewal term are estimated in the table below:
Yearly Sludge Annual Annual Costs Annual Costs
Production Sludge Cost Turbine Landfill Gas
Fiscal Year (Dry Tons)__ with 3% CPI Operations Purchase*** Annual Costs
2003-2004* 10,200 dry tons $1,376,694.00 $180,000.00 $402,276.00 $1,958,970.00
2004-2005 37,000 dry tons $5,031,344.00 $725,400.00 $1,618,689.00 $7,375,433.00
2005-2006 37,740 dry tons $5,285,930.00 $747,162.00 $1,657,317.00 $7,690,409.00
2006-2007 38,495 dry tons $5,553,427.00 $769,577.00 $1,697,103.00 $8,020,107.00
2007-2008 39,265 dry tons $5,834,445.00 $792,664.00 $1,738,083.00 $8,365,192.00
2008-2009 40,050 dry tons $6,129,622.00 $816,444.00 $1,780,292.00 $8,726,358.00
2009-2010** 20,425 dry tons $1195,843.00 $417,339.00 $906,328.00 $4,519,510.00
TOTAL 223,175 dry tons $32,407,305.00 $4,448,585.00 $9,800,088.00 $46,655,979.00
* 3 Months (July 2004 through September 2004)
** 6 Months (October 2009 through March 2010)
*** Estimated annual cost is based on the not-to-exceed monthly cost of$132,500
Renda Environmental, Inc., is in compliance with the City's M/WBE Ordinance by committing to 20%
M/WBE participation. The City's goal on this project is 19%.
Funding for this contract is budgeted on an annual basis. Additionally, the contract has a funding out
clause that provides that the contract will terminate if the City fails to budget for any year of the option
Logname: 60RENDA Page 2 of 3
period.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that funds are available in the current operating and capital budgets, as
appropriated of the Water and Sewer Fund and the Sewer Capital Project Fund.
TO Fund/Account/Centers FROM Fund/Account/Centers
PS58 539120 070580300120 $180.000.00
PE45 539120 0705002 $1.774.020.00
Submitted for City Manager's Office by: Marc Ott (8476)
Originating Department Head: Dale Fisseler (8207)
Additional Information Contact: Dale Fisseler (8207)
Logname: 60RENDA Page 3 of 3