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California Waste Services LLC - FY2016-010-03 AMENDMENT NO 3 TO NON-EXCLUSIVE FRANCHISE AGREEMENT FOR PROVISION OF SOLID WASTE HANDLING SERVICES BETWEEN THE CITY OF RANCHO PALOS VERDES AND CALIFORNIA WASTE SERVICES, LLC, THIS AMENDMENT TO THE AGREEMENT FOR NON-EXCLUSIVE FRANCHISE FOR PROVISION OF SOLID WASTE HANDLING SERVICES ( Amendment No 3 ') by and between the CITY OF RANCHO PALOS VERDES (`City' ) and CALIFORNIA WASTE SERVICES, LLC,a limited liability company ( Contractor ) is effective as of January 1, 2022 RECITALS A City and Contractor entered into that certain Non-Exclusive Franchise Agreement For Provision Of Solid Waste Handling Services dated Apnl 1, 2016 ( Agreement"), whereby City granted Contractor a non-exclusive franchise to provide solid waste handling services to commercial premises, and on-call box and bin services to residential and commercial premises(the Services') for one year, until December 31, 2017 B On December 5, 2017,City and Contractor entered into Amendment No I to the Agreement to extend the term of Contractor s services for three years, until December 31, 2020, and to make other miscellaneous changes C On December 1, 2020, City and Contractor entered into `Amendment No 2 to the Agreement to extend the term of Contractor's services for one year, until December 31, 2021, to allow time to negotiate changes to the Agreement required by state law, namely Senate Bill 1383 D CITY and Contractor now desire to amend the Agreement to extend the term of Contractor's services for one year, until December 31, 2022 to allow for continued negotiations to implement an SB 1383 compliance program TERMS 1 Contract Changes The Agreement is amended as provided herein Deleted text is indicated in strip and added text in bold italics a Section 23,Term & Extended Term, is amended to read Unless earlier term mated in accordance with Article XI of this Agreement,this Agreement shall continue in full force and effect from the Effective Date until December 31, 20212022 If contractor provides wntten notice to City of its willingness to extend the Agreement not later than six (6) calendar months pnor to expiration of the term or any extended term of the Agreement,City may,in its sole and unfettered discretion, extend the term of this Agreement,under its then-existing terms and conditions, for a maximum of(1) year (or any shorter period of time, as may be determined by City) City may waive the six-month notice requirement in its sole discretion ' 2 Good Faith Negotiation Between the effective date of this Amendment No 3 and December 31 2022, the parties agree to negotiate diligently and in good faith the terms for SB 1383 compliance and a revised or restated agreement for non-exclusive franchised, commercial solid waste handling services that will encompass SB 1383 compliance The parties acknowledge the negotiation goal of having a revised or restated agreement for waste services in compliance with SB 1383 in effect as early as possible Contractor agrees to reasonably and in good faith cooperate with City and its contractors or consultants in providing non-proprietary and non- confidential data, information and records as needed to negotiate such revised or restated agreement needed to implement SB 1383 compliance Although each party is obligated to negotiate diligently and in good faith pursuant to the terms of this Amendment No 3, neither party is under any obligation to approve or enter into a restated or amended franchise agreement, and all expenses incurred by such party during the term hereof are incurred at its sole nsk and expense This Amendment No 3 does not waive any police powers or discretion of the City Dunng any negotiation period, Contractor's reliance on any representations or promises by City or their staff or consultants,or individual Council members, is undertaken at Contractor's sole risk and expense 3 Continuing Effect of Agreement Except as amended by Amendment Nos 1-3, all provisions of the Agreement shall remain unchanged and in full force and effect From and after the date of this Amendment No 3,whenever the term Agreement appears in the Agreement, it shall mean the Agreement, as amended by Amendment Nos 1-3 to the Agreement 4 Affirmation of Agreement, Warranty Re Absence of Defaults City and Contractor each ratify and reaffirm each and every one of the respective rights and obligations arising under the Agreement Each party represents and warrants to the other that there have been no wntten or oral modifications to the Agreement other than as provided herein Each party represents and warrants to the other that the Agreement is currently an effective,valid,and binding obligation a Contractor represents and warrants to City that, as of the date of this Amendment,City is not in default of any material term of the Agreement and that there have been no events that, with the passing of time or the giving of notice,or both, would constitute a material default under the Agreement b City represents and warrants to Contractor that, as of the date of this Amendment,Contractor is not in default of any material term of the Agreement and that there have been no events that, with the passing of time or the giving of notice, or both, would constitute a material default under the Agreement 5 Adequate Consideration The parties hereto irrevocably stipulate and agree that they have each received adequate and independent consideration for the performance of the obligations they have undertaken pursuant to this Amendment 6 Authority The persons executing this Amendment No 3 on behalf of the parties hereto warrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Amendment No 3 on behalf of said party, (iii) by so executing this Amendment No 3, such party is formally bound to the provisions of this Amendment No 3, and 01203 00I4/760605 I -2- (iv) the entenng mto this Amendment does not violate any provision of any other agreement to which said party is bound [SIGNATURES ON FOLLOWING PAGE] 01203 00 14/760605 1 -3- IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first-above wntten CITY CITY OF RANCHO PALOS VERDES, a municipal corporation ElII avid L Bradley, Mayor ATTEST eresa caoka, City Clerk APPROVED AS TO FORM ALESHIRE & WYNDER, LLP )dam4-1/114—Th William W Wynder, City Attorney CONTRACTOR CALIFORNIA WASTE SERVICES, LLC By Name Enc Casper Title President By Name Title Address 621 W 152 Street Gardena, CA 96247 Two corporate officer signatures required when Contractor is a corporation,with one signature required from each of the following groups-1)Chairman of the Board,President or any Vice President,and 2)Secretary,any Assistant Secretary,Chief Financial Officer or any Assistant Treasurer CONTRACTOR'S SIGNATURES SHALL BE DULY NOTARIZED, AND APPROPRIATE ATTESTATIONS SHALL BE INCLUDED AS MAY BE REQUIRED BY THE BYLAWS, ARTICLES OF INCORPORATION, OR OTHER RULES OR REGULATIONS APPLICABLE TO CONTRACTOR'S BUSINESS ENTITY 01203 0014/760605 1 -4- CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate venues only the identity of the individual who signed the document to which this certificate is attached,and not the truthfulness,accuracy or validity of that document STATE OF CALIFORNIA COUNTY OF LOS ANGELES T bvNom MI r On 'q,y /1,2l 22 before me .-01gi .l h �c,u4), personally appeared Irrrc Coil .^ ,proved to me on the basis of satisfactory evidence to be the person(s) whose names(s �re subscribed to the within instrument and aa nowledged to me that Gishe/they executed the same in ler/their authorized capacity(ies), and that by hi her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument_ I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct r JONATHAN ICHINO X WITNESS my hand and official seal U COMM #2383156 N to n NOTARY PUBLIC CALIFORNIA n LOS ANGELES COUNTYSignature XMy Comm Expires Nov 15 2025 I OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT ❑ INDIVIDUAL. ❑ CORPORATE OFFICER TITLE OR TYPE OF DOCUMENT TITLE(S) ❑ PARTNER(S) 0 LIMITED 0 GENERAL NUMBER OF PAGES ❑ ATTORNEY-IN-FACT ❑ TRUSTEE(S) ❑ GUARDIANICONSERVATOR ❑ OTHER DATE OF DOCUMENT SIGNER IS REPRESENTING. (NAME OF PERSON(S)OR ENTI Y(IES)) SIGNER(S)OTHER THAN NAMED ABOVE 01203 0014/760605 1 AMENDMENT NO. 2 TO NON-EXCLUSIVE FRANCHISE AGREEMENT FOR PROVISION OF SOLID WASTE HANDLING SERVICES BETWEEN THE CITY OF RANCHO PALOS VERDES AND CALIFORNIA WASTE SERVICES, LLC THIS AMENDMENT NO. 2 TO THE NON-EXCLUSIVE FRANCHISE AGREEMENT FOR PROVISION OF SOLID WASTE HANDLING SERVICES ("Amendment" or "Amendment No 2") by and between the CITY OF RANCHO PALOS VERDES ("CITY") and CALIFORNIA WASTE SERVICES, LLC, ("CONTRACTOR") is effective as of the 1st day of January, 2020 RECITALS A CITY and CONTRACTOR entered into that certain Non-Exclusive Franchise Agreement For Provision Of Solid Waste Handling Services dated April 1, 2016 ("Agreement") whereby CITY granted CONTRACTOR a non-exclusive franchise to provide solid waste handling services to commercial premises, and on-call box and bin services to residential and commercial premises B On December 5, 2017 CITY and CONTRACTOR entered that "Amendment No 1" to the Agreement to extend the term of CONTRACTOR's services and to make other miscellaneous changes C Since the parties last amended the Agreement, Senate Bill 1383 ("SB 1383") was enacted in 2017 and its administration undertaken by State CalRecycle The bill establishes statewide targets to reduce the statewide disposal of organic waste by 50 percent by 2020 and 75 percent by 2025, and requires that not less than 20 percent of edible food that is currently disposed be recovered for human consumption by 2025 The SLCP Organic Waste Reductions regulations developed by CalRecycle to implement SB 1383 were adopted in 2020 and set forth a variety of programmatic and policy-related requirements for jurisdictions, generators, and other entities to support the statewide goals of SB 1383 D The CITY and other jurisdictions throughout the State will need to amend existing franchise agreement(s) or develop new franchise agreement(s) to implement and maintain programs to comply with SB 1383's comprehensive and complex regulatory requirements related to collection, processing, collection containers, contamination monitoring, education, reporting, and other issues Updating the CITY's waste hauling franchise agreements as necessary for compliance with SB 1383 will entail a significant amount of negotiation,data gathering from each waste hauler serving the CITY, and substantive contractual terms It is expected that the process of memorializing and implementing measures needed for SB 1383 compliance will take a period of up-to one(1)year Therefore, CITY and CONTRACTOR intend to extend the Agreement term in order to accommodate the process of implementing SB 1383 compliance E CITY and CONTRACTOR now desire to amend the Agreement to extend the term for one (1) year, or to December 31, 2021, and allow for negotiations to implement a SB 1383 compliance program 01203 0014/675231 1 TERMS 1 Recitals The foregoing Recitals are accepted and incorporated herein by this reference 2 Contract Changes The Agreement is amended as provided herein Deleted text is indicated in strilethreugh and added text in bold italics Section 2 3, Term & Extended Term, is hereby amended to read as follows "Unless earlier terminated in accordance with Article XI of this Agreement, this Agreement shall continue in full force and effect from the Effective Date until December 31, 2020 2021 If contractor provides written notice to City of its willingness to extend the Agreement not later than six (6) calendar months prior to expiration of the term or any extended term of the Agreement, City may, in its sole and unfettered discretion,extend the term of this Agreement,under its then-existing terms and conditions, for a maximum of three(3)years one (1)year(or any shorter period of time,as may be determined by City) City may waive the six-month notice requirement in its sole discretion " 3 Good Faith Negotiation. Between the effective date of this Amendment and up- to December 31, 2021, the parties agree to negotiate diligently and in good faith the terms for SB 1383 compliance and a revised or restated agreement for non-exclusive franchised, commercial solid waste handling services that will encompass SB 1383 compliance The parties acknowledge the negotiation goal of having a revised or restated agreement for waste services in compliance with SB 1383 in effect no later than December 31, 2021 CONTRACTOR agrees to reasonably and in good faith cooperate with CITY and its contractors or consultants in providing non- proprietary and non-confidential data, information and records as needed to negotiate such revised or restated agreement and needed to implement SB 1383 compliance Although each party is obligated to negotiate diligently and in good faith pursuant to the terms of this Amendment No 2, neither party is under any obligation to approve or enter into a restated or amended franchise agreement, and all expenses incurred by such party during the term hereof are incurred at its sole risk and expense This Amendment No 2 does not waive any police powers or discretion of the CITY During any negotiation period, CONTRACTOR's reliance on any representations or promises by CITY or their staff or consultants, or individual Council members, is undertaken at CONTRACTOR's sole risk and expense 4 Continuing Effect of Agreement. Except as amended by this Amendment, all provisions of the Agreement shall remain unchanged and in full force and effect From and after the date of this Amendment, whenever the term "Agreement" appears in the Agreement, it shall mean the Agreement, as amended by this Amendment to the Agreement 5 Affirmation of Agreement; Warranty Re Absence of Defaults CITY and CONTRACTOR each ratify and reaffirm each and every one of the respective rights and obligations arising under the Agreement Each party represents and warrants to the other that there have been no written or oral modifications to the Agreement other than as provided herein Each party represents and warrants to the other that the Agreement is currently an effective, valid, and binding obligation 01203 0014/675231 2 a CONTRACTOR represents and warrants to CITY that, as of the date of this Amendment, CITY is not in default of any material term of the Agreement and that there have been no events that, with the passing of time or the giving of notice, or both, would constitute a material default under the Agreement b CITY represents and warrants to CONTRACTOR that, as of the date of this Amendment, CONTRACTOR is not in default of any material term of the Agreement and that there have been no events that, with the passing of time or the giving of notice, or both, would constitute a material default under the Agreement 6 Adequate Consideration The parties hereto irrevocably stipulate and agree that they have each received adequate and independent consideration for the performance of the obligations they have undertaken pursuant to this Amendment 7 Authority The persons executing this Amendment on behalf of the parties hereto warrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Amendment on behalf of said party, (iii) by so executing this Amendment, such party is formally bound to the provisions hereof, and (iv) the entering into this Amendment does not violate any provision of any other agreement to which said party is bound [SIGNATURES ON FOLLOWING PAGE] 01203 0014/675231 2 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first-above wntten CITY CITY OF RANCHO PALOS VERDES, a municipal corporation 1 . Cruikshank, Mayor ATTEST V Eftnly Colborn, ity Clerk 41 APPROVED AS TO FORM ALESHIRE &WYNDER, LLP 4)d v .— William W Wynder, City Attorney CONTRACTOR CALIFORNIA WASTE SERVICES,LLC By Name j�cz e_ C4 �— Title r1�ftS► p�.� By Name Title Address Two corporate officer signatures required when CONTRACTOR is a corporation,with one signature required from each of the following groups 1) Chairman of the Board, President or any Vice President, and 2) Secretary,any Assistant Secretary, Chief Financial Officer or any Assistant Treasurer CONTRACTOR'S SIGNATURES SHALL BE DULY NOTARIZED,AND APPROPRIATE ATTESTATIONS SHALL BE INCLUDED AS MAY BE REQUIRED BY THE BYLAWS, ARTICLES OF INCORPORATION, OR OTHER RULES OR REGULATIONS APPLICABLE TO CONTRACTOR'S BUSINESS ENTITY 01203 0014/675231 1 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached,and not the truthfulness,accuracy or validity of that document STATE OF CALIFORNIA COUNTY OF LOS ANGELES a p�I On cG'- 78. 2020 before me,-1.°11'K ,personallappeared�°nc e"‘ /9°1". ,proved to me on the basis of satisfactory evidence to be the personwhose names( 1s/ace subscribed to the within instrument and acknowledged to me that he/shehfrey-executed the same in his/herhhetr authorized capacity(), and that by his/her•6thefit signature n the instrument the person or the entity upon behalf of which the person(*acted, executed the instrument I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hang •.. offic al seal K CHO X � r COMM #2287139 (n Signature / U;• , NOTARY PUBLIC CALIFORNIA N r^r LOS ANGELES COUNTY ,,s, My Comm Expires May 2 2023 OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT El INDIVIDUAL COORAT,�OFFICER _ v e4�� lUe f ti LLr-e— TITLE(S) ITLE TY(PE O 0c1Th'EN ❑ PARTNER(S) ❑ LIMITED / moo Y'^ Cvac& ❑ GENERAL CSG /,A C ❑ ATTORNEY-IN-FACT c� tt ❑ TRUSTEE(S) NUMBER OF PAGES ❑ GUARDIAN/CONSERVATOR ❑ OTHER `"( ,/4 SIGNER IS REPRESENTING DATE OF DOCUMENT (N*I§ PERSDAT ENY(IES)) 1 L e SIGNER(S)OTHER THAN NAMED ABOVE 01203 0014/675231 1 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached,and not the truthfulness,accuracy or validity of that document STATE OF CALIFORNIA COUNTY OF LOS ANGELES On ,2020 before me, ,personally appeared ,proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authonzed capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct WITNESS my hand and official seal Signature OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT ❑ INDIVIDUAL El CORPORATE OFFICER TITLE(S) TITLE OR TYPE OF DOCUMENT El PARTNER(S) El LIMITED ❑ GENERAL El ATTORNEY-IN-FACT El TRUSTEE(S) NUMBER OF PAGES ❑ GUARDIAN/CONSERVATOR ❑ OTHER SIGNER IS REPRESENTING DATE OF DOCUMENT (NAME OF PERSON(S)OR ENTITY(IES)) SIGNER(S)OTHER THAN NAMED ABOVE 01203 0014/6752311 AMENDMENT NO. 1 TO NON-EXCLUSIVE FRANCHISE AGREEMENT FOR PROVISION OF SOLID WASTE HANDLING SERVICES THIS AMENDMENT TO THE NON-EXCLUSIVE FRANCHISE AGREEMENT ("Amendment") by and between the CITY OF RANCHO PALOS VERDES ("City") and California Waste Se ices LL , a California Corporation ("Contractor" or "Franchisee") is effective as of the day of 10Pr 017. RECITALS A. City and Contractor entered into that certain Non-Exclusive Franchise Agreement For Provision Of Solid Waste Handling Services dated April 1,2016("Agreement")whereby City granted Contractor a non-exclusive franchise to provide solid waste handling services to commercial premises, and on-call box and bin services to residential and commercial premises. B. City and Contractor now desire to amend the Agreement to extend the term for three(3)years, and to make other miscellaneous changes. TERMS 1. Contract Changes.The Agreement is amended as provided herein. Deleted text is indicated in strilEethr-eugh and added text in bold italics. (a) Section 2.3, Term & Extended Term, is hereby amended to read as follows: "Unless earlier terminated in accordance with Article XI of this Agreement, this Agreement shall continue in full force and effect from the Effective Date until December 31, 2017 2020. If contractor provides written notice to City of its willingness to extend the Agreement not later than six(6)calendar months prior to expiration of the term or any extended term of the Agreement, City may, in its sole and unfettered discretion,extend the term of this Agreement,under its then-existing terms and conditions, for a maximum of three (3) years (or any shorter period of time, as may be determined by City). City may waive the six-month notice requirement in its sole discretion." (b) Section 3.3.3,Payment Protocol,is hereby amended to read as follows: "All such Franchise Fees and AB 939 Fees required pursuant to this Section 3.3 shall be made to City within thirty (30) Days of the conclusion of each calendar quarter during the Term hereof, including any extension thereof. Upon the expiration of any such thirty (30) Day period, a delinquent assessment of twenty- five percent (25%) of the amount due per month, or Two Hundred Dollars Even ($200.00), whichever is higher, shall be levied against any unpaid balance. Each payment of the Franchisee Fee and AB 939 Fee shall be accompanied by a statement setting forth the Gross Receipts collected by Franchisee and the computation of the total of each fee due. Each statement shall include the following certification executed by an officer of the Franchisee: "I hereby certify that the foregoing statement of the Franchise Fee and AB 939 Fee payments is made by me, that I am authorized to make such statement, and that, to the best of my knowledge and belief, it is true, correct and complete." No acceptance by City of any payment shall be construed as an accord that the amount is the correct amount, nor shall such acceptance of payment be construed as a release of any claim City may have against Franchisee for any additional sums payable under the provisions of this Agreement. All amounts paid shall be subject to independent audit and recompilation by City." (c) Section 4.3,Hours & Dates of Collection,is hereby amended to read as follows: "Franchisee shall so conduct its operations so as to offer the least possible obstruction and inconvenience to public traffic or disruption to the peace and quiet of the area within which Collections are effected. In accordance therewith, Collection services by Franchisee shall only be performed between the hours of 7:00 a.m. and 7:00 p.m. (standard and daylight savings time) of any day, except that no Collections shall be made on Sunday. City may, from time to time, revise the Collection hours specified in this Section by duly adopted resolution. Further, Franchisee shall observe the following holidays annually(whereby there will be no Collection services and Collection shall occur one non-holiday weekday Day late following the holiday): • New Year's Day • Memorial Day • Independence Day • Labor Day • Thanksgiving Day • Christmas Day Franchisee shall also observe any additional holidays coinciding with the holiday schedule observed by the County to the extent such County-observed holiday results in the closure of the County's Disposal Sites. In any week in which one of these holidays falls on a Collection day, Collection will be delayed to the next business day. Any changes to the holiday Collection schedule may only be made as approved by the City in advance in writing." 01203.0006/417698.1 -2- W:\LAUREN\Solid Waste\COMM\2018\CWS Amendment No.1 to Non-Exclusive Commercial Waste Hauler Agreement.docx (d) Section 4.6, Encroachment Permits Required, is hereby amended to read as follows: "Franchisee shall not place any Container at any Premises within the City until Franchisee has verified that the Owner of the Premises has obtained a required encroachment permit from Public Works or has verified with the City that none is required. No Container shall be placed or used in any manner that violates an applicable encroachment permit. Franchisee shall immediately remove any Container that does not have a valid encroachment permit, unless notified by the City that none is required. The Franchisee shall furnish and install flashing barricades adjacent to any Container that is placed within the public right of way. Upon request of the City, Franchisee shall provide the City with the address of any Premise where a Container will be placed,the size of the Container,the duration of the placement, and the type of material that will be placed in the Container. If City removes a Container that is placed in violation of this Section, Franchisee shall immediately reimburse City for all costs incurred by City in removing the Container." (e) Section 6.2.5,is hereby added to read in its entirety as follows: "Commercial Franchisee Provided Containers shall not block/obstruct traffic motorists' line of sight in any direction and shall not infringe on any driveway approach, fire hydrant, emergency facility, or utility cabinet. Commercial Franchisee Provided Containers shall have cones or delineators, reflectors, and reflectorized tape at corners." 2. Continuing Effect of Agreement. Except as amended by this Amendment, all provisions of the Agreement shall remain unchanged and in full force and effect. From and after the date of this Amendment, whenever the term "Agreement" appears in the Agreement, it shall mean the Agreement, as amended by this Amendment to the Agreement. 3. Affirmation of Agreement; Warranty Re Absence of Defaults. City and Contractor each ratify and reaffirm each and every one of the respective rights and obligations arising under the Agreement. Each party represents and warrants to the other that there have been no written or oral modifications to the Agreement other than as provided herein. Each party represents and warrants to the other that the Agreement is currently an effective,valid, and binding obligation. Contractor represents and warrants to City that, as of the date of this Amendment, City is not in default of any material term of the Agreement and that there have been no events that, with the passing of time or the giving of notice, or both, would constitute a material default under the Agreement. City represents and warrants to Contractor that, as of the date of this Amendment, Contractor is not in default of any material term of the Agreement and that there have been no events that, with the passing of time or the giving of notice, or both, would constitute a material default under the Agreement. 01203.0006/417698.1 -3- W:\LAUREN\Solid Waste\COMM\2018\CWS Amendment No.1 to Non-Exclusive Commercial Waste Hauler Agreement.docx L / 4. Adequate Consideration. The parties hereto irrevocably stipulate and agree that they have each received)adequate and independent consideration for the performance of the obligations they have undertaken pursuant to this Amendment. 5. Authority. The persons executing this Agreement on behalf of the parties hereto arrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Agreement on behalf of said party,(iii)by so executing this Agreement,such party i 'formally bound to the provisions of this Agreement, and (iv) the entering into this Agreement d es not violate any provision of any other Agreement to which said party is bound. [SIGNATURES ON FOLLOWING PAGE] I l 01203.0006/417698.1 -4- W:\LAUREN\Solid Waste\COMM\2018\CWS Amendment No. Ito Non-Exclusive Commercial Waste Hauler Agreement.docx IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year first-above written. CITY: CITY OF RANCHO PALOS VERDES, a municipal corporation , Mayor ATTES' polborn, City Clerk APPROVED AS TO FORM: ALESHIRE &WYNDER, LLP .4tr- • Day- eshire, City Attorney CONTRACTOR: CALIFORNIA WASTE SERVICES LLC By: Name: .= .e Title: h 12�� i D r rT By: Name: Title: Address: 6,,- L/ I5L r? L/ (A, 76., U 7 Two corporate officer signatures required when Contractor is a corporation,with one signature required from each of the following groups: 1)Chairman of the Board,President or any Vice President;and 2)Secretary,any Assistant Secretary, Chief Financial Officer or any Assistant Treasurer. CONTRACTOR'S SIGNATURES SHALL BE DULY NOTARIZED, AND APPROPRIATE ATTESTATIONS SHALL BE INCLUDED AS MAY BE REQUIRED BY THE BYLAWS, ARTICLES OF INCORPORATION, OR OTHER RULES OR REGULATIONS APPLICABLE TO CONTRACTOR'S BUSINESS ENTITY. 01203.0006/417698.1 -5- W:\LAUREN\Solid Waste\COMM\2018\CWS Amendment No. 1 to Non-Exclusive Commercial Waste Hauler Agreement.docx CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached,and not the truthfulness,accuracy or validity of that document. STATE OF CALIFORNIA COUNTY OF LOS ANGELES On /1JO /, 70 ,2017 before me,, wl�. 'C, ersonally appeared E'-`.C_ 0.6,5ee proved to me on the basis of satisfactory evidence to be the person(s)-whose names)-is/ar-e-subscribed to the within instrument and acknowledged to me that he/fey executed the same in his/ham authorized capacit iy , and that by his/herltheir-signature on the instrument the person $,or the entity upon behalf of which the perso acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. M_, ": \^ JOHN K. CHO 3.,,, COMM.#2105705 (� ': •7 j' NOTARY PU3JC-CALIFORNIA U Ca Y LOS ANGELES COUNTY la Signature. _ 1� My Comm.Expires Apr.4,2019 mi OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT CI INDIVIDUAL CORPORATE FICER A-7,-L._ /v(J. ( ii,r,i: TITLE OR TYPE OF DOCUMENT TITLE(S) ❑ PARTNER(S) ❑ LIMITED r- ❑ GENERAL NUMBER OF PAGES ❑ ATTORNEY-IN-FACT ❑ TRUSTEE(S) ❑ GUARDIAN/CONSERVATOR ❑ OTHER DATE OF DOCUMENT SIGNER IS REPRESENTING: (N PERS��O NTITY(IES)) SIGNER(S)OTHER THAN NAMED ABOVE 01203.0006/417698.1 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached,and not the truthfulness,accuracy or validity of that document. STATE OF CALIFORNIA COUNTY OF LOS ANGELES On ,2017 before me, ,personally appeared ,proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature: OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT El INDIVIDUAL El CORPORATE OFFICER TITLE OR TYPE OF DOCUMENT TITLE(S) El PARTNER(S) El LIMITED ❑ GENERAL NUMBER OF PAGES El ATTORNEY-IN-FACT El TRUSTEE(S) El GUARDIAN/CONSERVATOR El OTHER DATE OF DOCUMENT SIGNER IS REPRESENTING: (NAME OF PERSON(S)OR ENTITY(IES)) SIGNER(S)OTHER THAN NAMED ABOVE 01203.0006/417698.1 NON-EXCLUSIVE FRANCHISE AGREEMENT FOR PROVISION OF SOLID WASTE HANDLING SERVICES THIS NON-EXCLUSIVE FRANCHISE AGREEMENT FOR PROVISION.OF SOLID WASTE HANDLING SERVICES ("Agreement")is made and entered into this /SSi�day April of 2016 by and between California Waste Services LLC ("Franchisee") and the CITY OF RANCHO PALOS VERDES,a municipal corporation of the State of California("City"). City and Franchisee are occasionally herein referred to each as a"Party"and collectively as the "Parties". RECITALS A. The Legislature of the State of California,by enactment of the California Integrated Waste Management Act of 1989("AB 939")declares that a city may determine all aspects of Solid Waste Handling which are of local concern, including,but not limited to, frequency of Collection, means of Collection and transportation, level of services,charges and fees and the nature,location and extent of providing Solid Waste Handling services; B. The passage of AB 32,the California Global Warming Solutions Act of 2006,("AB 32") required by law a sharp reduction of greenhouse gas (GHG) emissions. AB 32 requires California to reduce its GHG emissions to 1990 levels by 2020 — a reduction of approximately 15%below emissions expected under a"business as usual"scenario. Local governments will play a vital role in the implementation of AB 32 by identifying opportunities and best practices to increase waste reduction and recycling,thereby reducing carbon emissions. Franchisee's operation of a mixed waste processing system will contribute to GHG emissions reductions by maximizing diversion to reduce gas-producing landfill deposits and utilizing latest fuel and vehicular technologies to reduce carbon emissions produced by waste hauling vehicles in performing waste Collection and Diversion activities for the City and by recovering and recycling commodities in the waste stream; C. In 2011, the State of California enacted Assembly Bill 341 ("AB 341"), which provides further procedures for complying with AB 32. The purpose of AB 341 is to achieve the reduction in GHG by increasing the amount of commercial waste recycled in California, specifically, by requiring businesses and public entities that generate four cubic yards or more of solid waste per week,and multifamily residences with five or more units,to recycle. The provision of commercial recycling services is required by this Agreement; D. The Legislature of California, by enactment of Chapter 12.9 of Part 3 of Division 30 of the Public Resources Code (Section 42649.8, et seq.; also known as "AB 1826"), requires each jurisdiction to implement an Organic Waste Recycling program on and after January 1,2016, and requires business that generate eight or more cubic yards of waste per week to arrange for organic waste recycling services by April 1, 2016. The provision of organic waste recycling services is required by this agreement; E. AB 939, AB 32, AB 341, and AB 1826 and related laws pertaining to the environmental impacts of solid waste,as maybe enacted or amended in the future,are collectively referred to herein as the "Refuse Impact Reduction Laws." Pursuant to California Public Resources Code Section 40059(a)(2),and Rancho Palos Verdes Municipal Code Section 8.20.260, the City Council of the City of Rancho Palos Verdes has determined that the public health, safety, and welfare require that a non-exclusive franchise be awarded to qualified Solid Waste Enterprises for Commercial Solid Waste Handling and On-Call Commercial and Residential Bin and Box services in the City; F. The successful implementation of Commercial Solid Waste Handling and On-Call Commercial and Residential Bin and Box services in the City will entail the expenditure of large sums of capital by the Franchisee, for which the Franchisee is entitled to be compensated. City intends that this Agreement will contribute to safeguarding public health by providing the most cost-effective, efficient, reliable, and environmentally appropriate solid waste services to its citizens; G. Prior to entering into this Agreement, City entered into an exclusive franchise agreement,and a subsequent amendment thereto,with EDCO Disposal Corporation for Residential Solid Waste Management Services ("EDCO Agreement"). The current Agreement is intended to compliment and not conflict with the EDCO Agreement. NOW THEREFORE,in consideration of the promises and covenants contained herein,the above recitals,and other good and valuable consideration,the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows: ARTICLE I DEFINITIONS; DELEGATION OF AUTHORITY. 1.1. General. Whenever any term used in this Agreement has been defined by the provisions of Chapter 8.20 of the Rancho Palos Verdes Municipal Code (hereinafter "Chapter 8.20") or by Division 30, Part I or Part 3 of the California Public Resources Code, the definitions in the Municipal Code or the Public Resources Code shall apply unless the term is otherwise defined in this Agreement, in which case this Agreement shall control. 1.2. Definitions. Except as provided in Section 1.1, words beginning with lower case letters are being used with their common ordinary meanings, not as defined terms. Otherwise, the following capitalized words and terms shall have the following respective meanings: 1.2.1 AB 32. "AB 32"means Assembly Bill 32,the Global Warming Solutions Act of 2006. 1.2.2 AB 341. "AB 341" means Assembly Bill 341 from the 2011-2012 Regular Session of the California Legislature (Chapter 476, Statutes 2011). 1.2.3 AB 939. "AB 939"means the California Integrated Waste Management Act of 1989, Public Resources Code Section 40000 et seq. and regulations promulgated thereunder, as amended from time to time. 1.2.4 AB 939 Fee. "AB 939 Fee"means the fee paid by Franchisee to the City to aid the City's compliance with Refuse Impact Reduction Laws, as described in Section 3.3.2 hereof. 01203.0001/286603.5 2 1.2.5 AB 1826. "AB 1826"means Chapter 12.9 of Part 3 of Division 30 of the Public Resources Code, beginning at Section 42649.8, which requires each jurisdiction to implement an Organic Waste Recycling program on and after January 1, 2016, and requires businesses that qualify as "Organic Waste Generators" to arrange for Organic Waste recycling services on and after April 1, 2016. 1.2.6 Affiliate. "Affiliate" means all businesses (including corporations, limited and general partnerships and sole proprietorships) which are directly or indirectly related to Franchisee by virtue of direct or indirect ownership interest or common management. All such businesses shall be deemed to be "Affiliated with" Franchisee and included within the term "Affiliates"as used herein. An Affiliate shall include a business in which Franchisee owns a direct or indirect ownership interest, a business which has a direct or indirect ownership interest in Franchisee and/or a business which is also owned, controlled or managed by any business or individual which has a direct or indirect ownership interest in Franchisee. For purposes of determining whether an indirect ownership interest exists, the constructive ownership provisions of Section 318(a)of the Internal Revenue Code of 1986,as in effect on the date of this Agreement, shall apply; provided, however, that(i) "ten percent (10%)" shall be substituted for"fifty percent (50%)"in Section 318(a)(2)(C) and in Section 318(a)(3)(C)thereof; and(ii) Section 318(a)(5)(C) shall be disregarded. For purposes of determining ownership under this paragraph and constructive or indirect ownership under Section 318(a),ownership interest of less than ten percent (10%) shall be disregarded and percentage interests shall be determined on the basis of the percentage of voting interest or value which the ownership interest represents, whichever is greater. Being an Affiliate does not exempt a business from the application of assignment requirements under Article VIII hereof. 1.2.7 Agreed Upon Procedure. "Agreed Upon Procedure" shall mean the procedures and methodology approved by the City's Finance Department for review and audit of Franchisee's financial records in connection with this Agreement. 1.2.8 Agreement. "Agreement" means this Agreement for Provision of Solid Waste Handling Services. 1.2.9 Annual Diversion Report. "Annual Diversion Report"means the annual report submitted by the Franchisee to the City describing the previous year's Diversion activities, Diversion percentages and associated calculations and the description of the Diversion activity planned for the upcoming year, if applicable. The Annual Diversion Report shall be prepared in a manner that directly corresponds to the reporting requirements of the California Department of Resources Recycling and Recovery (CalRecycle) and the California Integrated Waste Management Act, as amended. 1.2.10 Bin. "Bin"means a detachable container with a capacity equal to or less than six (6) cubic yards that is serviced using a front end loading vehicle (i.e., a"dumpster"). 1.2.11 Box. "Box," sometimes known as a "roll-off," means a metal container with a capacity of(10) or more cubic yards that is normally loaded onto a motor vehicle and transported to an appropriate facility. 01203.0001/286603.5 3 1.2.12 Bulky Waste. "Bulky Waste" means an item too large to fit in the container on the premises, including but not limited to household appliances (including refrigerators with and without Freon, ranges, washers, dryers, water heaters, dishwashers, plumbing, small household appliances, and other similar items commonly known as "white goods"); furniture (including chairs, sofas, mattresses, and rugs); Electronic Waste (including discarded electronic equipment such as, but not limited to, television sets, computer monitors, central processing units (CPUs), laptop computers, and peripherals (e.g., external computer hard drives, computer keyboards, computer mice, and computer printers), and other similar items commonly known as "brown goods" and "e-waste"); residential wastes (Green Waste larger than four (4) inches in diameter or four (4) feet in length, such as tree stumps, trunks or branches not exceeding one cubic yard per Collection); clothing; and tires. Bulky Waste does not include car bodies, Construction and Demolition Debris or items requiring more than two persons to remove. In the event a question ever arises as to whether a specific item or category of items meets the definition of Bulky Waste, City shall be responsible to determine whether said definition shall apply,which determination shall be final and binding on the Parties. Bulky Waste must have been generated on the customer's Premises in order to qualify for removal. 1.2.13 CalRecycle. "CalRecycle" means the California Department of Resources Recycling and Recovery. 1.2.14 City. "City" means the City of Rancho Palos Verdes, a municipal corporation organized under the laws of the State of California,and all of the territory lying within the municipal boundaries of the City as presently existing and, subject to the provisions of Section 3.1.2, all geographic areas which may be added or annexed thereto during the term of this Agreement. 1.2.15 City Manager. "City Manager" means the Manager of the City or his or her designee(s). 1.2.16 Collection. "Collection" means the process whereby Solid Waste is removed and transported from within the City. 1.2.17 Commercial. "Commercial"means relating to Commercial Premises. 1.2.18 Commercial Premises. "Commercial Premises" shall have the meaning given in Chapter 8.20 of the Rancho Palos Verdes Municipal Code,as amended from time to time. 1.2.19 Complaint. "Complaint" means any complaint received by mail, email, in writing, verbally,by telephone or in person. 1.2.20 Construction and Demolition Debris or C&D Material. "Construction and Demolition Material"or"C&D Material,"means any combination of inert building materials and Solid Waste resulting from construction, remodeling, repair, cleanup, or demolition operations. This term includes, but is not limited to, asphalt, concrete, cement, brick, lumber, gypsum wallboard, cardboard, and other associated packaging, roofing material, ceramic tile, carpeting; plastic pipe and steel. The material may be commingled with rock, soil, tree stumps; and other vegetative matter resulting from land clearing and landscaping for construction or land development projects. 01203.0001/286603.5 4 1.2.21 County. "County"means the County of Los Angeles. 1.2.22 Day. "Day" means calendar day, unless otherwise stated in this Agreement. 1.2.23 Disposal Site. "Disposal Site"means a final end-point or permanent site for the disposal of Solid Waste, such as a landfill, incineration facility or final processing facility for Recyclables. 1.2.24 Divert or Diversion. "Divert" or "Diversion" means to divert from disposal facilities or transformation facilities (including incineration, pyrolysis, distillation, gasification or biological conversion) through Source Reduction, Recycling and composting, as provided in Section 41780 of the Act as such Act may be hereafter amended or superseded provided that Divert or Diversion shall include delivery to transformation facilities if the overall Diversion achieved by the City is at a level where delivery to such facilities shall be considered Diversion pursuant to the Act. 1.2.25 EDCO Agreement. "EDCO Agreement" means that certain agreement between City and EDCO Disposal Corporation for exclusive Residential Solid Waste Management Services dated on or about November 24, 2009, and Amendment 1 to that same agreement dated June 30, 2015. 1.2.26 Effective Date. "Effective Date" means the date that this Agreement has been fully executed. 1.2.27 Electronic Waste. "Electronic Waste" means "Covered Electronic Waste" as defined in Section 42463 of the Public Resources Code and other discarded electronic equipment commonly known as "brown goods" such as, but not limited to, CD players and recorders, DVD players and recorders, stereos, computers, printers, keyboards, and peripherals. Revenues from the recycling of Electronic Waste shall be accounted for separately from revenues from other Recyclable Materials. 1.2.28 Franchisee. "Franchisee"means the entity above identified. 1.2.29 Franchise Documents. "Franchise Documents" means Chapter 8.20 as the same exists or may be amended in the future of the Municipal Code of the City of Rancho Palos Verdes, and this Agreement. 1.2.30 Franchise Fee. "Franchise Fee" means that consideration paid by Franchisee to the City as consideration for the grant of non-exclusive franchise effected by the Agreement and as described in Section 3.3.1 hereof. 1.2.31 Franchisee Provided Container or Container. "Franchisee Provided Container" or "Container" refers to either a Bin or a Box provided by Franchisee to customers. Such Containers shall be constructed of a minimum of twenty percent (20%) post-consumer recycled content once Franchisee has exhausted its existing inventory of Containers (i.e., Franchisee's existing inventory may not meet the 20%requirement but all Containers acquired by Franchisee following this Agreement shall meet such requirement). Franchisee shall not be 01203.0001/286603.5 5 required to replace its existing Containers to meet the requirements of this Section unless or until they are in need of replacement as reasonably determined by Franchisee or as otherwise provided in this Agreement. Containers not meeting the 20% requirement and replaced under a manufacturer's warranty shall be exempt from the 20%requirement. 1.2.32 Green Waste. "Green Waste" means any and all forms of biodegradable plant material which can be placed in a covered Container, such as wastes generated from the maintenance or alteration of public, Commercial or Residential landscapes including, but not limited to, yard clippings, leaves, tree trimmings, prunings, brush, and weeds. Tree stumps and limbs greater than three (3) inches in diameter are excluded unless they are reduced to a chipped form; otherwise, such large portions of Green Waste shall be considered Bulky Waste. 1.2.33 Gross Receipts. "Gross Receipts" means any and all revenue received from billings by Franchisee, and compensation in any form, of Franchisee or subsidiaries, parent companies or other Affiliates of Franchisee, for the Collection and transportation of Solid Waste pursuant to this Agreement, in accordance with generally accepted accounting principles, including, but not limited to, monthly customer fees for Collection of Solid Waste, without subtracting Franchise Fees or AB 939 Fees or any other cost of doing business. Gross Receipts include Gross Recycling Receipts and Gross Recycling Revenue. 1.2.34 Gross Recycling Receipts."Gross Recycling Receipts"means any and all revenue received from billings by Franchisee, and compensation in any form, of Franchisee or subsidiaries, parent companies or other Affiliates of Franchisee, for the Collection and transportation of Recyclables pursuant to this Agreement, in accordance with generally accepted accounting principles, including, but not limited to, monthly customer fees for Collection of Recyclables, without subtracting Franchise Fees or AB 939 Fees or any other cost of doing business. Gross Recycling Receipts is included in Gross Receipts. 1.2.35 Gross Recycling Revenue. "Gross Recycling Revenue" means the revenues received by Franchisee from the sale of all Recyclable Materials handled by Franchisee (including the recycling of Electronic Waste,HHW,U-Waste and White Goods). Gross Recycling Revenue is included in Gross Receipts. 1.2.36 Hazardous Waste. "Hazardous Waste" means any hazardous or toxic substance, material or waste which is or becomes regulated by any local governmental authority, the State of California or the United States Government. The term"Hazardous Material"includes, without limitation, any material or substance which is: (i) petroleum or oil or gas or any direct or derivate product or byproduct thereof; (ii) defined as a "hazardous waste," "extremely hazardous waste"or"restricted hazardous waste"under Sections 25115,25117,or 25122.7,or listed pursuant to Section 25140, of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law); (iii) defined as a "hazardous substance" under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.8 (Carpenter-Presley-Tanner Hazardous Substance Account Act); (iv) defined as a "hazardous material," "hazardous substance,"or"hazardous waste"under Sections 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory); (v) defined as a"hazardous substance"under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances); (vi) "used oil" as 01203.0001/286603.5 6 defined under Section 25250.1 of the California Health and Safety Code;(vii)asbestos;(viii)listed under Chapter 11 of Division 4.5 of Title 22 of the California Code of Regulations, or defined as hazardous or extremely hazardous pursuant to Chapter 10 of Division 4.5 of Title 22 of the California Code of Regulations; (ix) defined as a hazardous substance pursuant to the Porter- Cologne Act, Section 13050 of the California Water Code; (x) designated as a "toxic pollutant" pursuant to the Federal Water Pollution Control Act, 33 U.S.C. Section 1317; (xi) defined as a "hazardous waste" pursuant to the Federal Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (42 U.S.C. § 6903); (xii) defined as a"hazardous substance"pursuant to the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601,et seq. (42 U.S.C. § 9601); (xiii)defined as"Hazardous Material"pursuant to the Hazardous Materials Transportation Act,49 U.S.C. Section 5101,et seq.;or(xiv)defined as such or regulated by any"Superfund"or"Superlien" law, or any other federal, state or local law, statute,ordinance, code, rule, regulation, order or decree regulating, relating to, or imposing liability or standards of conduct concerning Hazardous Materials and/or oil wells and/or underground storage tanks and/or pipelines, as now, or at any time hereafter, in effect. 1.2.37 Household Hazardous Waste or HHW. "Household Hazardous Waste" or "HHW" shall mean that waste resulting from products purchased by the general public for household use which,because of their quantity, concentration, or physical,chemical,or infectious characteristics, may pose a substantial known or potential hazard to human health or the environment when improperly treated, disposed, or otherwise managed. 1.2.38 Infectious Waste. "Infectious Waste"means waste capable of producing an infection or pertaining to or characterized by the presence of pathogens including, but not limited to, certain wastes generated by medical practitioners, hospitals, nursing homes, medical testing labs,mortuaries, taxidermists, veterinarians, veterinary hospitals and medical testing labs. 1.2.39 Materials Recovery Facility. "Material Recovery Facility or MRF" shall mean a transfer station which is designed to, and as a condition of its permit shall, source separate or recover disposed materials for reuse, Recycling or other Diversion from the waste stream. 1.2.40 MRF/TS. "MRF/TS"means a fully permitted facility where Solid Waste, Recyclable Materials, and other materials are processed, sorted or separated for the purposes of recovering reusable or Recyclable Materials,processing or composting,which facility may or may not include a transfer station that receives Solid Waste from Collection vehicles and transfers the material to larger vehicles for transport to landfills and other destinations. 1.2.41 Oil Waste. "Oil Waste"means used motor oil and used oil filters. 1.2.42 On-Call. "On-Call" means service provided by Franchisee that is not regularly scheduled or is scheduled more than twenty-four(24)hours in advance. On-Call service is initiated by a customer by calling, writing, emailing, or requesting the service in person at Franchisee's office. 1.2.43 Organic Waste. "Organic Waste" shall have the meaning set forth in California Public Resources Code Section 42649.8(c), as may be amended from time to time. 01203.0001/286603.5 7 1.2.44 Owner. "Owner" means the person, organization or corporation holding the legal title to the real property constituting the Premises to which solid waste management services are provided. For the purposes of provisions in this Agreement pertaining to the sending of notices,billings or other communications by Franchisee to an Owner, Franchisee may regard as the Owner the person, organization, corporation or other entity shown in the records of the Assessor of the County or as may be indicated by documents recorded in the Office of the Recorder of the County. "Owner"includes the Owner's authorized representative(s). 1.2.45 Premises. "Premises" means any parcel of land, building(s) and/or structure(s), or portion thereof, in the City where Solid Waste is produced, generated or accumulated and which is billed as one customer. 1.2.46 Proposition 218. "Proposition 218" means Articles XIIIC and XIIID of the California Constitution and any implementing legislation promulgated thereunder, as may be amended from time to time. 1.2.47 Reasonable Business Efforts. "Reasonable Business Efforts"means those efforts a reasonably prudent business person would expend under the same or similar circumstances in the exercise of such person's business judgment, intending in good faith to take steps calculated to satisfy the obligation which such person has undertaken to satisfy. 1.2.48 Recyclable Materials or Recvclables. "Recyclable Materials" or "Recyclables" interchangeably mean any product salvaged or collected for the purpose of reprocessing or remanufacturing including, but not limited to, Organic Waste, Electronic Waste, glass, newsprint, aluminum, cardboard,paper, Green Waste, wood, plastics or metal. Recyclable Materials discarded by the Owner(including where the Owner pays a fee or other consideration to have Recyclable Materials collected by another party) are Solid Waste. 1.2.49 Refuse Impact Reduction Laws. "Refuse Impact Reduction Laws"means AB 939, AB 32, AB 341, and AB 1826 and related laws pertaining to the environmental impacts of solid waste, as may be enacted or amended in the future. 1.2.50 Remodel. The term "Remodel" or "Remodeling" shall refer to any construction or demolition project (other than mere repair work) requiring the issuance of a building permit or such construction and demolition project that generates for disposal bulky structural items, appliances (household or Commercial) like showers, tubs, toilets, ovens, stoves, cabinetry and built-in units, roofing materials, etc., and other C&D Material. 1.2.51 Residential. "Residential"means relating to Residential Premises. 1.2.52 Residential Premises. "Residential Premises" shall have the meaning given in Chapter 8.20 of the Rancho Palos Verdes Municipal Code, as amended from time to time. 1.2.53 Solid Waste or Refuse. "Solid Waste"is synonymous with"Refuse"shall have the meaning given in California Public Resources Code Section 40191. For purposes of this Agreement, materials shall be regulated as Solid Waste, whether or not they may be potentially recyclable, if(i) the material is mixed or commingled with other types of Solid Waste, or (ii) the payment of a fee, charge, or other consideration, in any form or amount, is directly or indirectly 01203.0001/286603.5 8 solicited or received from the generator by any person or combination of persons in exchange for Collection, removal, transportation, storage, processing, conversion, consulting, container rental or disposal services ("fee for service" recycling), whether or not arranged by or through a subcontractor,broker, agent or Affiliate of the service provider. 1.2.54 Solid Waste Enterprise. "Solid Waste Enterprise" shall have the meaning given in Public Resources Code Section 40193 (i.e., any individual, partnerships,joint venture, unincorporated private organization, or private corporation, which is regularly engaged in the business of providing Solid Waste Handling services). 1.2.55 Solid Waste Handling. "Solid waste handling" or "handling" (or other form thereof) means: (i) "Solid Waste Handling" or "Handling" as defined in Public Resources Code Section 40195 (i.e., the Collection, transportation, storage, transfer, or processing of solid wastes)and Solid Waste disposal by a Solid Waste Enterprise, such as Residential or Commercial Refuse Collection in packer-type vehicles by haulers whose core business is refuse Collection or the small-scale Collection and disposal of Residential or Commercial Solid Waste in any type of truck,trailer or vehicle; and(ii)the development and operation of Solid Waste facilities. 1.2.56 Source Reduction. "Source Reduction"means the process of reducing the amount of waste produced by the person or organization generating such waste. Source Reduction occurs through the use of alternative goods and products and/or the reuse of goods and products. 1.2.57 Source Separated and Source Separation. "Source Separated" and "Source Separation" describe the segregation, by the generator, of materials designated for separate Collection for some form of materials recovery or special handling. 1.2.58 U-Waste. "Universal Waste" or "U-Waste" means all waste defined by Title 22, Subsections 66273.1 through 66273.9 of the California Code of Regulations. These include,but are not limited to,batteries, fluorescent light bulbs, mercury switches, and Electronic Waste. 1.2.59 Waste Diversion or Diversion. "Waste Diversion" or"Diversion"means to divert from Disposal Sites or Transformation facilities (as "Transformation" is described in Section 40201 of the Act, as may be amended) through Source Reduction, Recycling and composting, as provided in Section 41780 of the Act, provided that"Divert" or"Diversion" shall include delivery to Transformation facilities if the overall Diversion achieved by the City is at a level where delivery to such facilities shall be considered Diversion pursuant to the Act. 1.2.60 White Goods. "White Goods" means inoperative and discarded refrigerators, microwave ovens, ranges, water heaters, freezers, and other similar household appliances. 1.3. Delegation of Authority. The administration of this Agreement by the City shall be under the supervision and direction of the City Manager and the actions specified in this Agreement shall be taken by the City Manager or his/her designee. 01203.0001/286603.5 9 ARTICLE II GENERAL REPRESENTATIONS & TERM 2.1. Documents. All of the provisions of the Franchise Documents are incorporated and made a part of this Agreement as though set forth in full. Nothing shall prevent the City from amending Chapter 8.20 of the Municipal Code or from adopting such other and further legislation as the City deems necessary or appropriate;provided,however,that the City shall give Franchisee thirty (30) Days' notice prior to considering any amendment to Chapter 8.20, and if such amendment would affect costs or revenue under this Agreement the parties shall meet and confer in good faith to determine whether the planned amendment will materially increase Franchisee's costs. 2.2. Effective Date; Commencement of Services. This Agreement shall become effective at the "Effective Date." However, except where specified, the provision of Solid Waste Collection and other services by Franchisee, shall commence on April 1, 2016 (the "Commencement Date"). Franchisee understands and agrees that the time between the Effective Date and the Commencement Date, is intended to provide Franchisee with ample and sufficient time to,among other things,order equipment,prepare necessary routing schedules and route maps, obtain any permits and licenses, establish/build facilities, obtain required service agreements, and begin the public awareness campaign as part of Franchisee's transition program as specified in this Agreement. 2.3. Term& Extended Term. Unless earlier terminated in accordance with Article XI of this Agreement, this Agreement shall continue in full force and effect from the Effective Date until December 31, 2017. If contractor provides written notice to City of its willingness to extend the Agreement not later than six(6)calendar months prior to expiration of the term or any extended term of the Agreement, City may, in its sole and unfettered discretion, extend the term of this Agreement,under its then-existing terms and conditions, for a maximum of three(3) years (or any shorter period of time, as may be determined by City). City may waive the six-month notice requirement in its sole discretion. 2.4. Representations and Warranties of Franchisee. 2.4.1 Compliance with Law. Franchisee represents and warrants that it has reviewed, is aware of, shall keep itself informed of, and shall render all services hereunder in accordance with all ordinances, resolutions, statutes, rules, and regulations of the City and any Federal, State, or local governmental entity having jurisdiction over the services hereunder at the time the services are rendered. 2.4.2 Non-Discrimination. Franchisee represents and warrants by and for itself, its heirs, executors, assigns and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin, sexual orientation, or ancestry in the performance of this Agreement. Franchisee shall take affirmative action to ensure that applicants are employed and that employees are treated during employment without regard to their race,color, creed, religion, sex,marital status, sexual orientation, national origin or ancestry. 01203.0001/286603.5 10 2.4.3 Qualifications and Experience. Franchisee represents and warrants that it has the qualifications, experience, facilities, and materials necessary to properly perform the services required under this Agreement in a thorough, competent, and professional manner, and is experienced in performing the work and services contemplated herein. 2.4.4 Corporate Status. Franchisee represents and warrants that it is a company duly organized, validly existing and in good standing under the laws of the State of California. Franchisee is qualified to transact business in the State of California and has the corporate power to own its properties and to carry on its business as now owned and operated and as required by this Agreement. 2.4.5 No Conflicts. Franchisee represents and warrants that neither the execution or delivery by the Franchisee of this Agreement, the performance by the Franchisee of the services under this Agreement,nor the fulfillment by the Franchisee of the terms and conditions hereof: (i) conflicts with, violates, or results in a breach of any law; (ii) conflicts with, violates, or results in a breach of any term or condition of any judgment, order, or decree of any court, administrative agency, or other governmental authority, or any agreement or instrument to which the Franchisee is a party or by which the Franchisee or any of its properties or assets are bound, or constitutes a default thereunder;or(iii)will result in the creation or imposition of any lien,charge, or encumbrance of any nature whatsoever upon any of the properties or assets of the Franchisee. 2.4.6 No Approvals Required. Franchisee represents and warrants that no approval, authorization, license, permit, order, or consent of, or declaration,registration, or filing with any governmental or administrative authority,commission,board,agency, or instrumentality is required for the valid execution and delivery of this Agreement by the Franchisee, except those that have been duly obtained from its board of directors. 2.4.7 No Litigation. Franchisee represents and warrants that there is no action, suit, proceeding, or investigation, at law or in equity, before or by any court or governmental authority, commission, board, agency, or instrumentality pending or, to the best of Franchisee's knowledge, threatened, by or against the Franchisee wherein any unfavorable decision, ruling, or finding, in any single case or in the aggregate, would materially adversely affect the performance by the Franchisee of its obligations under this Agreement or in connection with the transactions contemplated by this Agreement, or which, in any way, would adversely affect the validity or enforceability of this Agreement or any other agreement or instrument entered into by the Franchisee in connection with the transactions contemplated by this Agreement. 2.4.8 Familiarity with Work. Franchisee represents and warrants that Franchisee (i) has thoroughly investigated and considered the scope of services to be performed, (ii)has carefully considered how the services should be performed, and (iii) fully understands the facilities, difficulties and restrictions attending performance of the services under this Agreement. If the services involve work upon any site, Franchisee warrants that Franchisee has or will investigate the site and is or will be fully acquainted with the conditions there existing, prior to commencement of services hereunder. Should the Franchisee discover any latent or unknown conditions, which will materially affect the performance of the services hereunder, Franchisee shall immediately inform the City of such fact and shall not proceed except at Franchisee's risk until written instructions are received from the City Manager. 01203.0001/286603.5 11 2.4.9 Accuracy of Representations and Warranties. The representations and warranties made by Franchisee in this Section 2.4 are true and correct on and as of the Effective Date of this Agreement. 2.5. Ownership of Solid Waste. City and Franchisee understand and agree that it is Franchisee, and not City, who will arrange to collect Solid Waste, that City has not, and, by this Agreement does not, instruct Franchisee on its Collection methods, nor supervise the Collection process; nor do the Parties intend to place title to Solid Waste collected by Franchisee in City. Rather, the Parties intend that whatever, if any, title in and to the Solid Waste that is collected by Franchisee that otherwise might exist in or with City in the absence of this Agreement is hereby transferred to Franchisee; and further that if Franchisee gains title to such Solid Waste it is by operation of law and agreement with its customers and is not the result of this Agreement. At no time does City obtain any right of ownership or possession of Solid Waste or Recyclable Materials placed for Collection, and nothing in this Agreement shall be construed as giving rise to any inference that City has any such rights. City and Franchisee agree that, for the purposes of the Uniform Commercial Code and all other laws imposing liability for defective products, it is Franchisee,and not City which is to be considered the merchant of goods recycled pursuant to this Agreement. Subject to the provisions of this Agreement, Franchisee shall have the right to retain, Recycle,process,dispose of,and otherwise use Solid Waste collected pursuant to the terms hereof in any lawful fashion or for any lawful purpose; and, further, shall have the right to retain any benefit resulting from its right to retain, Recycle, process, dispose of, or reuse the Solid Waste which it collects. 2.6. No Joint Venture. Neither the City nor any of its employees shall have any control over the manner, mode or means by which Franchisee, its agents or employees, perform the services required herein, except as otherwise set forth. Franchisee shall perform all services required herein independent from the City and shall remain at all times as to City a wholly independent entity with only such obligations as are consistent with that role. Franchisee shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of City. City shall not in any way or for any purpose become or be deemed to be a partner of Franchisee in its business or otherwise or a joint venturer or a member of any joint enterprise with Franchisee. ARTICLE III GRANT OF FRANCHISE; SCOPE OF FRANCHISE; EXCLUSIONS 3.1. Grant of Franchise. 3.1.1 General Grant. The City grants to Franchisee, and Franchisee shall have during the Term of this Agreement, the non-exclusive franchise, right, license and privilege (except as provided in Section 3.2 below) to engage in the business of collecting, transporting, transferring, processing, recycling, treating, Diverting, converting, and collecting for disposal all Solid Waste and Recyclable Materials generated by Commercial Premises,and to provide On-Call Box and Bin services to Residential and Commercial Premises, within the City of Rancho Palos Verdes. It is expressly understood that the Solid Waste management business is conducted by Franchisee and not City, and while City grants the right to conduct the business within the terms of this Agreement,the Franchisee must determine what personnel to employ,terms and conditions 01203.0001/2866015 12 of employment, what equipment to utilize and at what cost, rates and charges to establish for customers, and all methods, costs, obligations and mechanisms to undertake the terms of the franchise. 3.1.2 Annexations. This Agreement shall extend to any territory annexed to the City during the Term that is not covered by an existing Solid Waste permit, license, agreement or franchise granted by another public entity,except to the extent that Collection by Franchisee within that annexed territory would violate the provisions of Public Resources Code Section 49520. In such event, this Agreement shall become effective as to such area at the earliest possible date permitted by law, and City agrees that it shall cooperate with Franchisee to fulfill any requirement necessary for Franchisee to serve the annexed area consistent with this Section 3.1.2. 3.2. Scope of Franchise; Exceptions. The franchise granted to Franchisee shall be non-exclusive within City limits such that Franchisee and all other contractors to whom City may grant a franchise (collectively, "franchise haulers"), shall be the sole providers of general Solid Waste and Recyclable Materials hauling services to City residents and businesses. To this end, at all times during the Term of this Agreement the City shall require that all Solid Waste and Recyclable Materials collected from Residential and Commercial Premises for a fee, service charge, or other consideration be collected by a franchise hauler, with the following exceptions: 3.2.1 EDCO Agreement. Franchisee's franchise rights are subject to the exclusive residential franchise rights set forth in the EDCO Agreement. 3.2.2 Other Authorized Commercial Haulers. City expressly reserves the right to grant non-exclusive franchise rights to other Solid Waste Enterprises to provide services similar to or identical to the services that Franchisee will provide under this Agreement. 3.2.3 Intergovernmental Immunity. The following entities may contract with non-franchise haulers for any Solid Waste Handling services: (i) public universities, (ii) public school districts, (iii) other state agencies, (iv) any other governmental entity that is not subject to the City's police powers, and(v) any entity covered by the exclusivity provisions of any ordinance to be adopted by the City. 3.2.4 City Hauls. Nothing in this Agreement prohibits the City, through City officers or employees in the normal course of their City employment, from engaging in casual or emergency Collection, removal, disposal or Diversion of Solid Waste. 3.2.5 Self-Hauling. City residents, Owners, or occupants of Premises may engage in self-hauling. To qualify as a"self-hauler" for purposes of this exemption, an Owner or occupant must remove and personally transport Solid Waste or Recyclables from his/her own Premises using his/her own equipment for the purpose of lawfully delivering same to a Disposal Site or MRF/TS authorized to receive and handle Solid Waste or Recyclables. The use of a subcontractor is not"self haul"within the meaning of this exception. 3.2.6 Gardner/Landscaper Green Waste. Green Waste and other compostables may be removed from a Premises by an Owner or resident of the Premises or by a gardening, landscaping or tree trimming contractor as an incidental part of a total service offered by that contractor rather than as a hauling service. To qualify for this exemption,a gardener or landscaper 012030001/2866035 13 must not be a hauling service or Solid Waste Enterprise,must not separately or additionally charge for the incidental service of removing, transporting or disposing (except for tipping fee) of the Green Waste, and must utilize only his or her own employees and equipment to collect, transport and dispose of said Green Waste. 3.2.7 C&D Material. The Collection, transportation and disposal by a construction contractor of C&D Material from Remodeling jobs which are generated as an incidental part of providing such Remodeling services, provided that the construction contractor is not a hauling service or Solid Waste Enterprise, does not separately or additionally charge for the incidental service of removing, transporting or disposing (except for tipping fee) of the C&D Material, and utilizes only his/her own employees and equipment to collect, transport and dispose of the C&D Material. 3.2.8 Automotive Dismantling. A properly licensed non-franchise hauler may collect, transport, and dispose of vehicles or machine parts and waste generated by an automotive/vehicle dismantler or Owner of a vehicular salvage or disposal yard. 3.2.9 Asphalt/Concrete/Dirt Materials. A properly licensed non-franchise hauler may collect,process, and/or transport asphalt, concrete, and dirt. 3.2.10 Hazardous Waste. A properly licensed non-franchise hauler may collect, process and/or transport Hazardous Waste and non-spadeable wastewater or sewage sludge. 3.2.11 Recyclable Materials. A properly licensed non-franchise hauler may collect, transport, and recycle or sell Source Separated Recyclable Materials with a market value which the Owner of the generating Premises has not discarded,but rather sold or donated to such hauler, provided that such hauler is not engaged in the business of Collecting Solid Waste for a fee or other charge or consideration, and that no such materials are transported for disposition to a landfill or transfer station. A mere discount or reduction in price of third-party charges for the handling of Recyclables is not a sale or donation within the meaning of this Agreement and is thus precluded. 3.2.12 Oil Waste. Franchisee's franchise does not preclude the Collection, processing and/or transport of oil/used oil by third-party entities duly licensed to handle such waste. 3.2.13 Tires. Franchisee's franchise does not preclude the Collection,processing and/or transport of tires by third-party entities duly licensed to handle such waste. 3.2.14 Infectious Waste. Franchisee's franchise does not preclude the Collection, processing and/or transport of Infection Waste by third-party entities duly licensed to handle such Infectious Waste. 3.2.15 HHW, White Goods and U-Waste. Franchisee's franchise does not preclude the Collection,processing and/or transport of HHW,White Goods and U-Waste by third- party entities duly licensed to handle such Waste. 01203.0001/286603.5 14 3.2.16 Bulky Waste. Franchisee's franchise does not preclude the Collection, processing and/or transport of Bulky Waste by duly licensed non-franchise haulers. 3.2.17 Legally-Required Exemptions. Franchisee's franchise rights shall be limited by any other exemption created by City, State, or Federal law. 3.3. Compensation To City for Grant of Franchise. 3.3.1 Franchise Fee. In consideration for the grant of the franchise provided herein, Franchisee agrees to pay the City a franchise fee equaling five percent (5%) of the Gross Receipts received by Franchisee from the services provided in the City pursuant to this Agreement. 3.3.2 AB 939 Fee. To aid the City in complying with the Refuse Impact Reduction Laws, and during the entire Term of this Agreement, Franchisee shall also pay to the City an AB 939 Fee of five percent (5%) of Gross Receipts received by Franchisee from the services provided in the City pursuant to this Agreement. Further, to the extent Franchisee can show by documentary evidence satisfactory to the City Manager that Solid Waste was processed or disposed of in a manner that constitutes Diversion, the AB 939 Fee due for that period shall be reduced by the ratio of the Diverted Solid Waste to all Solid Waste collected during that period (e.g., if 10% of Solid Waste is Diverted,the AB 939 Fee for that period is reduced by 10%). 3.3.3 Payment Protocol. All such Franchise Fees and AB 939 Fees required pursuant to this Section 3.3 shall be made to City within thirty(30) Days of the conclusion of each calendar quarter during the Term hereof, including any extension thereof. Upon the expiration of any such thirty(30) Day period, a delinquent assessment of twenty-five percent (25%)per month shall be levied against any unpaid balance. Each payment of the Franchisee Fee and AB 939 Fee shall be accompanied by a statement setting forth the Gross Receipts collected by Franchisee and the computation of the total of each fee due. Each statement shall include the following certification executed by an officer of the Franchisee: "I hereby certify that the foregoing statement of the Franchise Fee and AB 939 Fee payments is made by me, that I am authorized to make such statement, and that, to the best of my knowledge and belief, it is true, correct and complete." No acceptance by City of any payment shall be construed as an accord that the amount is the correct amount, nor shall such acceptance of payment be construed as a release of any claim City may have against Franchisee for any additional sums payable under the provisions of this Agreement. All amounts paid shall be subject to independent audit and recompilation by City. ARTICLE IV SERVICES OF FRANCHISEE 4.1. General Standards. 4.1.1 Furnishing of Services. The work to be performed pursuant to this Agreement shall include: 01203.0001/286603.5 15 (a) the furnishing of all labor, materials and equipment necessary for, and the scheduled Collection of all Solid Waste and Recyclables from, Commercial Premises within the City where Franchisee has an agreement with the Commercial Premises Owner(s) for such service; and (b) the furnishing of all labor, materials and equipment necessary for the On-Call provision of Bins and Boxes for Solid Waste and Recyclables to Residential and Commercial Premises upon request from customers and the subsequent Collection of the same in accordance with a schedule to be determined by the Franchisee and customer, to the extent not in conflict with the EDCO Agreement or other such agreements with Solid Waste Enterprises. All services shall be provided according to the terms of this Agreement. Franchisee shall own or lease and maintain at its expense all equipment necessary to perform its duties as provided for under the Agreement, including sufficient radio equipment for office to field equipment communication. All work shall be accomplished in a courteous, thorough and workmanlike manner and adhere to the highest standards consistent with the best practice in the industry. As of the Effective Date of this Agreement, Franchisee shall not be required to collect materials unless they have been properly placed in Franchisee-Provided Containers unless otherwise specifically stated herein,including but not limited to Bulky Waste,Christmas trees and Green Waste. Notwithstanding the foregoing, the Parties hereto acknowledge that a need may arise for Franchisee to collect materials that are either placed in alternative, non-Franchisee- Provided Containers or that are placed directly for Collection without containment;to this end,the Parties may meet and confer in good faith in order to reach an accord as to how such needs may be met. Any program specifically requiring Franchisee to collect materials from alternative containers or to collect uncontained materials shall be memorialized in writing executed by each Party. 4.1.2 Oversight of City Manager. Performance of each of the provisions of this Agreement shall be under the direction of the City Manager or designee and the work hereunder shall be done in a thorough and workmanlike manner under the direction, and to the satisfaction, of the City Manager or designee. To this end, the City Manager shall have the power to establish rules and regulations relating to the accumulation, Collection, Recycling, disposal, and management of Solid Waste not inconsistent herewith and/or as necessary to ensure compliance with laws, ordinances and regulations,and which the City Manager finds are reasonably necessary for enforcement hereof or of applicable laws, ordinances and regulations, or for preservation of the public peace,health,and safety. Franchisee shall be given thirty(30)Days prior written notice of any such changes in rules or regulations excepting in those circumstances where the changes are necessitated by an immediate threat to the public health, safety and/or welfare. 4.1.3 Designated Disposal Site. Franchisee shall dispose of all collected Refuse at Franchisee's expense at a Disposal Site determined by Franchisee, except that any such Disposal Site shall be certified to accept all Solid Waste delivered by Franchisee and shall be in compliance with all federal, state, and local laws. 4.1.4 Hazardous Materials. 01203.0001/286603.5 16 (a) The scope of this Agreement and franchise excludes the handling of Hazardous Materials, and no right to provide Hazardous Materials handling services is conferred on Franchisee as a result of this Agreement. Franchisee shall ensure that only persons duly- licensed to handle Hazardous Materials shall be engaged when such services become necessary. (b) Franchisee shall implement a system of Hazardous Waste screening, identification, and prevention protocol reasonably designed to screen-out Hazardous Waste and prohibited materials that Franchisee is not permitted to handle pursuant to applicable law prior to Franchisee accepting such materials. If Franchisee inadvertently collects Hazardous Waste or other materials that Franchisee is not qualified or permitted to handle(under any applicable permit conditions or applicable laws),the Franchisee shall arrange,at no cost and without liability to City, for the proper disposal of such materials in accordance with applicable laws and regulations; provided however, that Franchisee shall be entitled to return any such Hazardous Waste, if the customer can be identified, or at its own expense pursue all legal rights and remedies it may have against the customer(s) who generated such materials. The City shall be indemnified by Franchisee from liability for any disposal of Hazardous Waste or other materials that Franchisee is not qualified or permitted to handle pursuant to Section 9.2 hereof. 4.2. Standards of Performance. 4.2.1 Availability of Franchisee. Franchisee has established,and shall continue to maintain a local office for the purpose of receiving customer payments and handling customer inquiries, orders and Complaints. The local office shall be open to the public between the hours of 8:00 a.m. to 5:00 p.m., five (5) Days per week, Monday through Friday, except Holidays. A representative of Franchisee shall be available during office hours for communication with the public at such local office. Additionally, the Franchisee shall continue to employ the services of a telephone representative, answering exchange or message system for calls during non-business hours and provide a telephone system sufficient and adequate to handle calls during peak periods. 4.2.2 Franchisee Liaison to City. Franchisee shall be reasonably available to the City. The Franchisee shall provide the City Manager, the local Los Angeles County Sheriffs Department, and the local Los Angeles County Fire Department with an emergency telephone number for effectively reaching Franchisee in the case of off-hour emergencies. Franchisee shall also provide the City Manager with the cellular phone number of a Franchisee representative(s) with day-to-day managerial responsibility over Franchisee services provided within the City. One or more of the Franchisee's representatives described in this Section shall visit City offices at such reasonable times as the City Manager shall designate for the purpose of discussing any matters relating to this Agreement or the Franchisee's performance thereof. Any representative appointed by Franchisee shall occupy a position of sufficient managerial authority and knowledge of day-to- day Franchisee operations as to be able to meaningfully discuss performance issues with the City Manager. 4.2.3 Citizen Complaints. The Franchisee shall commence response to all Complaints within eight (8) business hours, shall return all customer phone calls within eight (8) business hours, and shall exercise Reasonable Business Efforts to resolve all Complaints. The City may, but is not obligated to, respond to Complaints that have not been addressed within two (2) business days and may charge the Franchisee for the actual costs incurred therefor. In 01203.0001/286603.5 17 connection herewith, Franchisee shall adequately staff its telephone system so that it is capable of handling all calls during peak business hours. 4.2.4 Record of Complaints. Franchisee shall maintain a record of all Complaints received by mail, by telephone or in person (including date, time, name, address of complainant and nature of Complaint) for a period of three (3) years. Franchisee will maintain records listing the date of consumer Complaints, the customer, describing the nature of the Complaint or request, and when and what action was taken by the Franchisee to resolve the Complaint. Copies of all Complaints and records described in this Section shall be submitted to the City Manager on a monthly basis,no later than two (2)business days following month's end. 4.2.5 Disputes. Disputes between the Franchisee and its customers regarding the services provided in accordance with this Agreement may be resolved by the City; provided, however, the City shall not be obligated to resolve any such disputes. The City Council by resolution may prescribe the procedures for processing customer Complaints. The City's decision shall be final and binding unless challenged in a court of competent jurisdiction. 4.2.6 Tags & Record of Non-Collected Material. The Franchisee shall notify customers in the event any item left for disposal is not picked up. Said notification shall be in the form of a written tag placed upon the customer's container, stating Franchisee's telephone,address and the reason for non-Collection. Reasons for non-Collection may include,but are not limited to the following: containers inaccessible to Franchisee(after Franchisee has made a reasonable effort to secure access); improper container or use of a non-Franchisee Provided Container; container overfilled; heavy container; or, the container includes Hazardous Waste. The Franchisee shall maintain a record of all items not collected. Should Franchisee fail to collect and dispose of materials set out or placed for Collection at times required, after notification by City and a reasonable time thereafter, City may collect and dispose of uncollected materials and Franchisee shall be liable to the City for the expenses incurred, plus overhead charges equal to thirty (30%) of the City's expenses in Collection. 4.2.7 Property Damage Caused by Franchisee. The Franchisee shall be responsible for the cost of repairing any property damaged by the negligent or intentional conduct of its employees or agents. The City may,but is not obligated to,respond to Complaints that have not been addressed in accordance with Section 4.2.3 hereof and may charge the Franchisee for the actual costs incurred by the City therefor. 4.2.8 Quality of Service Surveys. The City may, at its own expense, conduct periodic quality of service surveys of Franchisee's customers. Prior to finalizing the survey form, the City shall review the survey with the Franchisee. Results of the quality of service survey shall be reviewed with the Franchisee and used to discuss improvements in service delivery. 4.2.9 Annual Route Audit. At least once annually, Franchisee shall, at its own expense, conduct an audit of its Collection routes. The annual route audit shall include the truck identity servicing each route,number of accounts serviced per route(Commercial and Residential, as applicable), frequency of pick-ups, size of container for each account on the route, frequency of service for each account on the route, as well as the weight of the truck and refuse delivered to the 01203.0001/286603.5 18 applicable Disposal Site. Results of the annual route audit shall be available for review by the City. 4.2.10 "On-Call" Equipment and Personnel. During normal business hours, the Franchisee shall have "on-call" at least one (1) truck to handle called-in pick-ups or missed Collections. After normal business hours, the Franchisee shall have "on-call" the necessary manpower and equipment(including without limitation an emergency service vehicle to attend to Complaints or emergency calls) to respond to customer emergencies that are an immediate threat to life or property. Franchisee's on-call equipment and personnel shall also be available to assist the City with debris Collection and removal within a reasonable time resulting from emergencies and natural disasters,excepting that nothing in this Section shall require Franchisee to collect,haul or dispose of waste that Franchisee is not permitted to handle. 4.3. Hours & Dates of Collection. Franchisee shall so conduct its operations so as to offer the least possible obstruction and inconvenience to public traffic or disruption to the peace and quiet of the area within which Collections are effected. In accordance therewith, Collection services by Franchisee shall only be performed between the hours of 7:00 a.m. and 7:00 p.m. (standard and daylight savings time) of any day, except that no Collections shall be made on Sunday. City may, from time to time,revise the Collection hours specified in this Section by duly adopted resolution. Further, Franchisee shall observe the following holidays annually (whereby there will be no Collection services and Collection shall occur one Day late following the holiday): • New Year's Day • Memorial Day • Independence Day • Labor Day • Thanksgiving Day • Christmas Day Franchisee shall also observe any additional holidays coinciding with the holiday schedule observed by the County to the extent such County-observed holiday results in the closure of the County's Disposal Sites. In any week in which one of these holidays falls on a Collection day, Collection will be delayed to the next business day. Any changes to the holiday Collection schedule may only be made as approved by the City in advance in writing. 4.4. Collection of Refuse, Recyclable Materials, Green Waste, and Organic Waste For Commercial Customers. 4.4.1 Commercial Refuse Collection. Franchisee shall collect Refuse from Commercial Premises as frequently as scheduled by customer,but not less than once per week and more frequently if required to handle the waste generated at the Premises where the Containers are located. The Franchisee shall provide Containers as part of the Collection services. The size of the container and the frequency (above the minimum) of Collection shall be determined by 01203.0001/286603.5 19 agreement between the customer and the Franchisee. Size and frequency shall be sufficient to provide that no Refuse need be placed outside the Container. Unless expressly instructed by the City,Franchisee shall provide Franchisee Provided Containers only to those Commercial Premises that provide an appropriate location for such Container in accordance with the Rancho Palos Verdes Municipal Code. 4.4.2 Commercial Recyclable Materials Collection. Franchisee shall provide Recyclable Materials Collection services upon request by customers. Franchisee shall collect Recyclable Materials from Commercial Premises that have subscribed to Recyclable Materials Collection services as frequently as scheduled by the customer, but not less than once per week. Franchisee may determine the method of Recyclable Materials Collection, except that any such method must enable Commercial customers to comply with Public Resources Code Section 42649.2 either through Source Separation or through mixed waste processing that yields Diversion results comparable to Source Separation. Franchisee shall collect Recyclable Materials at the location agreed upon by Franchisee and customer. The designated Collection location, if disputed by Franchisee or customer, shall be determined by the City. Franchisee shall not be required to furnish a separate Container for Recyclable Materials unless such is required by Franchisee's chosen method of compliance with this paragraph. Franchisee shall use Reasonable Business Efforts to provide Commercial customers who qualify as Commercial Waste Generators (as that term is defined in Public Resources Code Section 42649.1)with such assistance and services as may be necessary to enable those Generators to comply with Public Resources Code Section 42649.2. 4.4.3 Commercial Green Waste Collection. Franchisee shall provide Source- Separated Green Waste Collection services upon request by customers. Franchisee shall collect Source-Separated Green Waste from Commercial Premises that have subscribed to Source- Separated Green Waste Collection services as frequently as scheduled by the customer, but not less than once per week. Franchisee shall allow Commercial Premises to select a Collection service method that best suits the needs of their Premises. Franchisee shall collect Source- Separated Green Waste Materials at the location agreed upon by Franchisee and customer. The designated Collection location, if disputed by Franchisee or customer, shall be determined by the City. 4.4.4 Commercial Organic Waste Collection. Franchisee shall provide Organic Waste recycling services upon request by customers. Franchisee shall collect Organic Waste from Commercial Premises that have subscribed to Organic Waste recycling services as frequently as scheduled by the customer,but not less than once per week. Franchisee may determine the method of Organic Waste Collection, except that any such method must enable Commercial customers to comply with Public Resources Code Section 42649.81(b) either through Source Separation or through mixed waste processing that specifically recycles Organic Waste. Franchisee shall collect Organic Waste at the location agreed upon by Franchisee and customer. The designated Collection location, if disputed by Franchisee or customer, shall be determined by the City. Franchisee shall not be required to furnish a separate Container for Organic Waste unless such is required by Franchisee's chosen method of compliance with this paragraph. 01203.0001/286603.5 20 Franchisee shall use Reasonable Business Efforts to provide Commercial customers who qualify as Organic Waste Generators (as that term is defined in Public Resources Code Section 42649.8) with such assistance and services as may be necessary to enable those Generators to comply with Public Resources Code Section 42649.81. 4.4.5 Special Collection Considerations for Commercial Premises. (a) Shared Containers. Commercial Premises may share Containers with neighboring business establishments provided that all sharing units share the same Premises and so long as the sharing of Containers does not result in the overfilling of, or overflow from, Containers. (b) Food Establishments. Those Commercial Premises consisting of food processing operations shall utilize their own Container for the disposal of food-related Solid Wastes(i.e.,a Container not shared with other Commercial Premises unless such Premises sharing the Container are also food processing operations disposing of food-related Solid Wastes). 45. On-Call Container Services. Franchisee shall provide Bins and Boxes to Residential and Commercial Premises on an On-Call basis as requested by customers. Container services shall include,but not be limited to,moving manually or by a specialized"scout"truck the Bins or Boxes from their non-curbside or non-regular storage location for Collection and returning the Bins or Boxes to such storage location. 4.6. Encroachment Permits Required.Franchisee shall not place any Container at any Premises within the City until Franchisee has verified that the Owner of the Premises has obtained a required encroachment permit or has verified with the City that none is required. No Container shall be placed or used in any manner that violates an applicable encroachment permit. Franchisee shall immediately remove any Container that does not have a valid encroachment permit, unless notified by the City that none is required. The Franchisee shall furnish and install flashing barricades adjacent to any Container that is placed within the public right of way. Upon request of the City,Franchisee shall provide the City with the address of any Premise where a Container will be placed, the size of the Container, the duration of the placement, and the type of material that will be placed in the Container. If City removes a Container that is placed in violation of this Section, Franchisee shall immediately reimburse City for all costs incurred by City in removing the Container. 4.7. On-Call Services for Collection of Bulky Waste. Franchisee shall provide Bulky Waste Collection services for Commercial Premises upon request. Franchisee shall make provisions for the recycling of Bulky Waste if a market for such waste is available. 4.7.1 Bulky Waste Collection Restrictions. Franchisee shall not accept any item constituting or containing Hazardous Waste or any single item that cannot be handled by two workers. Vehicles used for Collection of Bulky Waste shall not use compactor mechanisms or mechanical handling equipment that may damage reusable goods or release Freon or other gases from pressurized appliances. 4.7.2 Bulky Waste Containing Freon. In the event Franchisee Collects Bulky Waste that contains Freon, Franchisee shall handle such Bulky Waste in a manner such that the 01203.0001/286603.5 21 Bulky Waste is not subject to regulation as Hazardous Waste under applicable state and federal laws or regulations. 4.8. Christmas Tree Pickup. Franchisee agrees to collect holiday trees at no additional charge to customers for a four (4) week period or more following December 25 of the applicable calendar year. Franchisee may set reasonable requirements for the placement and condition of trees(e.g.,whether they need to be placed in Containers or whether they need to be cut into pieces) in order to ensure the safe and efficient Collection of the trees by Franchisee employees and to avoid the creation of a nuisance.Collector shall deliver the collected holiday trees to an appropriate facility for processing. ARTICLE V WASTE DIVERSION. 5.1. State Mandate. The Refuse Impact Reduction Laws currently set the directive of Diverting fifty percent (50%) of the City's Solid Waste, with a requirement to Divert 75%by the year 2020. If the City fails to implement its required plans to achieve the aforementioned directive under the Refuse Impact Reduction Laws, CalRecycle may impose administrative civil penalties of up to TEN THOUSAND DOLLARS ($10,000.00)per day until the City implements its plans. Furthermore,City anticipates that the State Legislature will adopt new legislation that will increase the minimum Diversion requirement. Upon the effective date of any new legislation that affects the Diversion requirements currently imposed by the current Refuse Impact Reduction Laws, Franchisee agrees to implement a revised or new Diversion program meeting such amended legislative requirements, to the extent reasonably necessary to enable the City to comply with the Refuse Impact Reduction Laws. Failure to implement an amended Diversion program based upon new State legislation mandating Waste Diversion levels shall constitute a default of this Agreement. 5.2. Development of Diversion Program. Upon City's request, Franchisee shall meet and confer with City in good faith to jointly develop Solid Waste Diversion strategies and develop Diversion programs adequate to meet the requirements established by the State. In the event of any change to State or regional laws,regulations or mandates setting new Diversion requirements applicable to the City, the Parties shall promptly meet and confer to negotiate in good faith the implementation of such amendments to law through the City's Solid Waste Diversion program. City and Franchisee shall reasonably cooperate in good faith to meet statutory Diversion requirements and otherwise to ensure compliance with the Refuse Impact Reduction Laws. If the City and Franchisee cannot agree on a program within thirty(30) Days after initially commencing any meet and confer process, City shall be entitled to specify the program to be implemented. 5.3. Cooperation and Education. The Franchisee shall cooperate with the Solid Waste Diversion activities of the City and shall coordinate Diversion activities and programs to the extent possible. The Franchisee shall cooperate with the City's efforts to develop and implement public education and information programs designed to promote Source Reduction, Recycling and composting in general as well as specific Waste Diversion strategies. Franchisee shall have a public education program in place by which it will distribute free educational information about Solid Waste management and Recycling to customers in their regular bills. 01203.0001/286603.5 22 5.4 Waste Diversion Reporting Requirements. The Franchisee shall comply with the Waste Diversion reporting requirements established by the City. Franchisee shall provide City with regular written reports in a form acceptable to the City and adequate to meet City's reporting requirements to CalRecycle in compliance with all Refuse Impact Reduction Laws, including a breakdown of the type and quantity of waste (by weight and volume) hauled by Franchisee, generator type(e.g., Commercial or Residential,or more specific categories as may be determined by City), the type and quantity of Recyclable Materials, HHW/U-Waste/E-Waste (as may be inadvertently received by Franchisee), Green Waste and Bulky Waste, and including a discussion of the quarterly Waste Diversion percentages achieved during the year. Franchisee shall report such information on a quarterly basis and shall also provide City with an Annual Diversion Report. Quarterly records will allow for reporting of seasonal variation in waste quantities and will assist in program operation, improvement and expansion. ARTICLE VI VEHICLES, EQUIPMENT AND PERSONNEL 6.1. Vehicles. 6.1.1 General. Franchisee shall continue to provide a fleet of Collection vehicles sufficient in number and capacity to perform efficiently the work required by this Agreement in strict accordance with its terms. Franchisee agrees to maintain each piece of equipment used by it in good order and repair,and not more than ten(10)years of age. All vehicles shall be uniformly painted and fully equipped for efficient automated Collection. All vehicles shall be registered with the California Department of Motor Vehicles and shall meet or exceed all applicable State and local requirements, including all applicable air pollution control laws. Each vehicle shall also carry a fire extinguisher, first aid kit and a broom and shovel to be used for the immediate removal of any spilled material. All spilled material shall be immediately removed by Franchisee. Franchisee shall be responsible for the cost of repairing all damage to driveway approaches caused by Franchisee's vehicles. Franchisee shall comply with the requirements of the Air Resources Board, or any successor agency, regarding Solid Waste Collection Vehicles, found in Title 13, California Code of Regulations, Sections 2020 through 2021.2, as may be amended from time to time. The City may require Franchise to improve or upgrade Collection vehicles to incorporate the latest technology available to control environmental impacts of the services provided hereunder. 6.1.2 Truck Bodies. All truck bodies used by Franchisee shall be constructed of metal, shall be watertight and leak-proof and shall be so constructed as to prevent odors or the falling, leaking or spilling of Solid Waste, Recyclables, or other materials. Franchisee shall maintain all trucks and equipment used within City in good mechanical condition and the same shall be clean and uniformly painted and numbered. All trucks and equipment shall have painted thereon, or affixed thereto, in letters and numbers at least six (6) inches in height, the name and telephone number of Franchisee, which name and telephone shall be clearly visible at all times. Each vehicle utilized by Franchisee shall be identified by numerals at least six(6)inches in height in a location or locations on such vehicles to be specified by City. A list showing each vehicle so identified shall be made available to City and maintained in the current status by Franchisee and, upon notice given by City, Franchisee shall make the equipment available for inspection. If City 01203.0001/286603.5 23 finds that any truck or equipment being used by Franchisee is not in satisfactory condition then the truck or equipment requiring correction of defects shall not be used by Franchisee in the performance of the Agreement until corrected to the reasonable satisfaction of City. In addition, if Franchisee's trucks are inspected by any other public agencies, copies of any inspection report shall be made available to the City upon request. 6.1.3 Backup Alarm. Each vehicle used for collecting, hauling or disposing of Solid Waste and/or Recyclables shall be equipped with an audible warning device that is activated when the vehicle is backing up. 6.1.4 Gross Vehicle-Weight Limit. No vehicle used for collecting, hauling or disposing of Solid Waste and/or Recyclables shall be loaded in excess of the manufacturer's gross vehicle weight rating or in excess of the maximum weight specified by the California Vehicle Code, whichever is less. Evidence of the manufacturer's name and gross vehicle weight rating shall be maintained in, or upon, every vehicle. 6.1.5 Preventive Maintenance and Repair Program. Within thirty(30) Days of the Effective Date of this Agreement, Franchisee shall have implemented a complete and comprehensive preventive maintenance and repair program, or if such repair program has already been implemented, Franchisee shall continue its performance thereof. Franchisee shall provide a copy of its preventative maintenance program to City for its review and approval, or if such a program has already been approved by the City, Franchisee shall notify the City of any updates to the program for City approval. Franchisee shall perform all scheduled maintenance functions in accordance with the manufacturer's specifications and schedule and shall inspect each vehicle daily to ensure that all equipment is in good working order. Franchisee shall keep accurate records of all vehicle maintenance and repairs,recorded according to date and mileage,nature of maintenance or repair and the signature of a maintenance supervisor or mechanic that the maintenance or repair has been properly performed. Franchisee shall make such maintenance records available to City on request. 6.1.6 Vehicle Cleaning. Each vehicle used within the City shall be cleaned thoroughly by washing with water after each Day's use. Vehicles shall be washed completely at least once a week and steam-cleaned on a regular basis so as to present a clean appearance and minimize odors,but in no event less than once a month. 6.1.7 Vehicle Storage. No vehicle used by Franchisee in performance of this Agreement shall be stored on any public street or other public property in the City. All Franchisee's vehicles if kept within the boundaries of the City shall at all times when not in use be kept on property of the proper zone either within a building or fenced yard. 6.2. Container Condition. Franchisee at its sole cost and expense shall maintain all Franchisee Provided Containers in good condition and repair as needed and shall clean and/or paint each Container annually. More frequent cleaning and painting shall be conducted by Franchisee if needed. Franchisee shall, at no charge, replace any Franchisee Provided Containers which become unusable by reason of normal conditions of wear and tear. If damages occur to a Franchisee Provided Container necessitating repairs or replacement of the Container, and if said damages were incurred as a direct result of customer negligence, the customer may be liable for 01203.0001/286603.5 24 such repair costs and/or replacement costs for the Container. During all times that a Franchisee Provided Container is in the custody and control of Franchisee, Franchisee shall not store such Container in or on public streets or rights-of-way. 6.2.1 Franchisee Provided Containers that have graffiti on them must be (i)removed and replaced, or(ii) cleaned of all graffiti, or(iii)repainted to a like-new appearance within 24 hours of Franchisee reasonably becoming aware of such graffiti. 6.2.2 Any addresses, name, company or other identifiers on Franchisee Provided Containers shall be neatly stenciled on the Containers. 6.2.3 If new laws or regulations relating to composting are enacted such that additional receptacles are required to be provided to customers for purposes of complying with the composting program, Franchisee will supply appropriate Franchisee-Provided Containers at no additional cost. 6.2.4 Commercial Franchisee Provided Containers shall be steam-cleaned at least once per year at no cost to the City or customers in a manner that does not materially disrupt the services provided under this Agreement or create a nuisance. 6.3. Inspection. 6.3.1 City Inspections. Franchisee shall give the City at least fifteen(15) Days prior written notice of any vehicle inspection to be performed by the California Highway Patrol ("CHP") and the City may elect to observe the CHP inspection. Without limiting the City's right to observe the CHP inspections, City reserves the right to cause any vehicle used in performance of this Agreement to be inspected and tested at any commercially reasonable time and in such manner as may be appropriate to determine that the vehicle is being maintained in compliance with the provisions of the Rancho Palos Verdes Municipal Code and the State Vehicle Code, including but not limited to California Vehicle Code §§ 27000(b), 23114, 23115, 42030, 42032, and all Vehicle Code Sections regarding smog equipment requirements. City may direct the removal of any vehicle from service if that vehicle is found to be in nonconformance with applicable codes. No vehicle directed to be removed from service shall be returned to service until it conforms with applicable codes and such conformance has been acknowledged by City. The City may elect in its sole discretion to hire an independent contractor to perform a comprehensive inspection of Franchisee's vehicles. If the City hires an independent contractor to perform the inspection on behalf of the City the Franchisee shall pay for the cost of such inspection. City shall act prudently in requesting any such inspection. 6.3.2 Brake Inspections. The brake system of each vehicle used in performance of this Agreement shall be inspected bi-annually by the CHP and shall comply with State law. Notice of certification shall be filed with the City within thirty (30) Days after each such certification. Failure to submit the required certification shall be grounds for terminating this Agreement. 6.3.3 Correction of Defects. Following any inspection, the City Manager shall have the right to reasonably require Franchisee to take out of service any vehicles and equipment not in good working order and cause Franchisee to recondition or replace any vehicle or equipment 01203.0001/286603.5 25 found to be unsafe,unsanitary or unsightly within thirty(30)Days of notification of defect in such vehicle or equipment. The City Manager's determination may be appealed to the City Council. 6.4. Personnel. 6.4.1 General. Franchisee shall furnish such qualified drivers, mechanical, supervisory, clerical and other personnel as may be necessary to provide the services required by this Agreement in a courteous, safe and efficient manner. Franchisee shall keep itself fully informed of existing and future State and Federal laws, rules and regulations in any manner affecting those engaged and employed in or on the work contemplated herein or in any way affecting the conduct of that work and of all orders or decrees of bodies of officials having jurisdiction or authority over the same, and shall, at all times, observe and comply with and cause any and all persons employed by Franchisee or under Franchisee cause to observe and comply with all such laws, ordinances, rules, regulations, orders and decrees. Franchisee and any subcontractors and/or employees under Franchisee shall comply with and be governed by the law of the State of California having to do with working hours as set forth in the Labor Code of the State of California, as the same may be amended from time to time. 6.4.2 Driver Qualifications. All drivers shall be trained and qualified in the operation of Collection vehicles and must have in effect a valid license, of the appropriate class, issued by the California Department of Motor Vehicles. 6.4.3 Uniforms and Identification Badges. Franchisee shall require its drivers and all other Collection personnel to wear a suitable and appropriate uniform as a means of identifying the employee. All other employees of Franchisee who come into contact with the public shall carry suitable identification badges or cards upon their person. 6.4.4 Employee Appearance and Conduct. All employees,while engaged in the Collection of Solid Waste and/or Recyclables within the City or otherwise engaged in services described in this Agreement, shall be attired in uniform. At least one member of every Collection truck crew shall be able to read and speak English. Franchisee shall use its best efforts to assure that all employees present a neat appearance and conduct themselves in a courteous manner. Franchisee shall regularly train its employees in customer courtesy, shall prohibit the use of loud or profane language,and shall instruct Collection crews to perform the work as quietly as possible. If any employee is found not to be courteous or not to be performing services in the manner required by this Agreement, Franchisee shall take all appropriate corrective measures. 6.4.5 Safety Training. Franchisee shall provide suitable operational and safety training for all its employees who use or operate vehicles or equipment for Collection of Solid Waste or who are otherwise directly involved in such Collection. Franchisee shall train its employees involved in Solid Waste and/or Recycling Collection to identify, and not to collect, Hazardous Wastes. Franchisee and its employees shall comply with the terms of all contracts between the Los Angeles County Department of Public Works and any Disposal Site that is used by Franchisee. 6.4.6 Safety. All work performed pursuant to this Agreement shall be performed in a manner that provides safety to the public and meets or exceeds safety standards 01203.0001/286603.5 26 outlined by the California Construction Safety Orders under the State of California Code of Regulations ("CAL-OSHA"). City reserves the right to issue restraint or cease and desist orders to Franchisee when unsafe or harmful acts are observed or reported to City. Franchisee shall instruct its employees to report immediately any hazardous conditions or Hazardous Wastes they observe within the City during the course of their work to the City. 6.4.7 No Gratuities. Franchisee shall not permit its employees or subcontractors to demand or solicit,directly or indirectly, any additional compensation or gratuity from members of the public for the work performed by those employees or subcontractors pursuant to this Agreement. 6.4.8 Notice of Labor Disputes. Franchisee shall advise City in writing at the time any negotiations are undertaken between Franchisee and its employees relating to the wages and benefits and Franchisee shall report the status of said negotiations from time to time including any pending strike, lock out, walkout,boycott or other labor dispute. ARTICLE VII RATES 7.1. Franchisee Sets Rates; Discounted Rate for Recyclables. Franchisee shall receive payment for services rendered under this Agreement according to rates set by the Franchisee as set forth in the service contract between Franchisee and Franchisee's customers. Franchisee may establish such rates and charges Franchisee believes are appropriate in the marketplace, except that the rate for the Collection and disposal of Recyclable Materials shall be no higher than 75% of the rate charged by Franchisee for the Collection and disposal of non- Recyclable Materials. No compensation for services shall be provided or paid to Franchisee by City except as expressly provided in this Agreement. 7.2. Assumption of the Risk. Franchisee is aware of the provisions Articles XIIIC and XIIID of the California Constitution known as Proposition 218,which provide for a public hearing for the establishment of property related fees and assessments by public entities and,relying on its own legal counsel,believes that in setting its own rates and directly billing customers, and with no City action in either setting rates or collecting revenue, the provisions of Proposition 218 are inapplicable to the services provided under this Agreement. Accordingly, Franchisee fully assumes the risk of(i) any legal action or judgement related to Proposition 218, and (ii) non- collection of fees. 7.3. Proposition 218 Indemnification. Notwithstanding the general indemnification provisions in Section 9.2, and subject to Public Resources Code Section 40059.2(d) as may be amended from time to time, Franchisee agrees to indemnify,defend with counsel appointed by the City,protect and hold harmless the City,its representatives,officers,agents and employees against any and all fines, response costs, assessments, actions, suits, injunctive relief, claims, damages to persons or property, losses, costs, penalties, obligations, errors, omissions or liabilities, ("claims or liabilities") that may be asserted or claimed by any person, firm or entity arising out of or in connection with the establishment of maximum rates for service under this Agreement or in connection with the application of Proposition 218 to the imposition, payment or Collection of rates and fees for services provided by Franchisee under this Agreement, unless occurring as a 01203.0001/286603.5 27 result of City's willful acts or omissions,but,to the fullest extent permitted by law,the provisions of this Section shall apply to claims and liabilities resulting in part from City's negligence. Nothing herein is intended to imply that Proposition 218 applies to the setting of rates for the services provided under this Agreement; rather this Section is provided merely to allocate risk of loss as between the Parties. In connection herewith: (a) Franchisee will defend any action or actions filed in connection with any of said claims or liabilities stated in this Section and will pay all costs and expenses, including legal costs and attorneys' fees, incurred in connection therewith; (b) Franchisee will promptly pay any judgment rendered against the City, its officers, agents or employees for any such claims or liabilities arising out of or in connection with Proposition 218; and Franchisee agrees to save and hold the City, its officers, agents and employees harmless therefrom; (c) In the event the City, its officers, agents or employees is made a party to any action or proceeding filed or prosecuted against Franchisee for such damages or other claims arising out of or in connection with Proposition 218, Franchisee agrees to pay to the City, its officers, agents or employees, any and all costs and expenses incurred by the City, its officers, agents or employees in such action or proceeding, including but not limited to, legal costs and attorneys' fees. Franchisee shall incorporate similar indemnity agreements with its subcontractors and if it fails to do so Franchisee shall be fully responsible to indemnify City hereunder therefore, and failure of City to monitor compliance with these provisions shall not be a waiver hereof. Franchisee's obligations hereunder shall survive the termination or expiration of this Agreement. 7.4. Direct Billing. All accounts shall be directly billed by Franchisee and in accordance with protocols established by Franchisee. 7.5. Delinquent Accounts; No Termination of Services Without City Consent. Franchisee shall use Reasonable Business Efforts to collect all delinquent accounts for services provided under this Agreement. If, after using Reasonable Business Efforts for ninety (90) days, Franchisee remains unable to collect on any delinquent account, Franchisee may request that the City meet and confer in good faith regarding further options for collecting and resolving issues of service to delinquent accounts. City and Franchisee shall meet and confer in good faith for a period of at least ninety (90) days unless a resolution is earlier reached. Under no circumstance shall Franchisee terminate service to any customer within the City without express written permission from the City. Nothing herein waives or supersedes the City's rights to initiate code enforcement action(s) in response to the build-up, long-term stagnation, or misplacement of Solid Waste as a result of any termination of Franchisee's service. Franchisee assumes the risk of any losses due to failure to collect, or delay in collecting, any delinquent account and shall be solely responsible for 01203.0001/286603.5 28 paying all costs and fees,including legal costs and attorneys' fees,incurred in attempting to collect delinquent accounts. ARTICLE VIII TRANSFERS OF INTEREST. 8.1. Restrictions on Transfers. The City, in entering into this Agreement, has placed a special value,faith and confidence in the experience,background,and expertise of the Franchisee in the field of waste disposal. Such faith and confidence being a substantial consideration in the granting of this Agreement warrants the transfer restrictions provided in this Article VIII. 8.2. Definition of Transfer. As used in this Section, the term"Transfer" shall include any hypothecation, mortgage, pledge, or encumbrance of this Agreement by Franchisee, subject to the exceptions set forth in Section 8.4 below. A Transfer shall also include the transfer to any person or group of persons acting in concert of more than thirty percent(30%)of the present equity ownership and/or more than thirty percent (30%) of the voting control of Franchisee (jointly and severally referred to herein as the "Trigger Percentages"), taking all transfers into account on a cumulative basis, except transfers of such ownership or control interest to an Affiliate owned or controlled by the present beneficial owners of Franchisee or members of their immediate family, or between members of the same immediate family, or transfers to a trust, testamentary or otherwise, in which the beneficiaries are limited to members of the transferor's immediate family. A transfer of interests (on a cumulative basis) in the equity ownership and/or voting control of Franchisee in amounts less than Trigger Percentages shall not constitute a Transfer subject to the restrictions set forth herein. In the event Franchisee or its successor is a corporation or trust, such Transfer shall refer to the transfer of the issued and outstanding capital stock of Franchisee, or of beneficial interests of such trust; in the event that Franchisee or any general partner comprising Franchisee is a limited or general partnership or a limited liability company, such Transfer shall refer to the transfer of more than the Trigger Percentages in the limited or general partnership or limited liability company interest; in the event that Franchisee or any general partner is a joint venture, such Transfer shall refer to the transfer of more than the Trigger Percentages of such joint venture partner,taking all transfers into account on a cumulative basis. 8.3. Transfers Require City Approval. Franchisee shall not Transfer this Agreement or any of Franchisee's rights hereunder, directly or indirectly, voluntarily or by operation of law, except as provided below,without the prior written approval of City Manager—unless the Transfer is of such significance that, in the sole discretion of the City Manager, the approval of the City Council is required— and if so purported to be transferred, such Transfer shall be null and void. Franchisee will submit its request for City consent to the City together with documents, including but not limited to: (i) the transferee's audited financial statements for at least the immediately preceding three (3) operating years; (ii) proof that the proposed transferee has municipal Solid Waste management experience on a scale equal to or exceeding the scale of operations conducted by Franchisee; (iii) proof that in the last five (5) years, the proposed transferee has not suffered any citations or other censure from any federal, state, or local agency having jurisdiction over its waste management operations due to any significant failure to comply with federal, state, or local waste management law and that the transferee has provided the City with a complete list of such citations and censures; (iv) proof that the proposed transferee has at all times conducted its operations in an environmentally safe and conscientious fashion; (v) proof that the proposed 01203.0001/286603.5 29 transferee conducts its municipal Solid Waste management practices in accordance with sound waste management practices in full compliance with all federal, state, and local laws regulating the Collection and disposal of waste, including Hazardous Waste; (v) proof that the transferee's officers or directors have no criminal convictions for fraud, deceit, false claims or racketeering with respect to the transferee's course of business; (vi) a "transition plan" describing how Franchisee proposes to efficiently transition the rights and obligations hereunder to the transferee or assignee without material disruptions to service, and(vii) any other information required by the City to ensure the proposed transferee can fulfill the terms of this Agreement, including the payment of indemnities and damages and provision of bonds and/or the Standards of Performance in Section 4.2, in a timely, safe, and effective manner. 8.4. Exceptions. The requirement to obtain City approval for a Transfer shall not apply to any of the following: (a) Any mortgage, deed of trust, sale/lease-back, or other form of conveyance for financing and any resulting foreclosure therefrom. (b) A sale or transfer resulting from or in connection with a reorganization as contemplated by the provisions of the Internal Revenue Code of 1986, as amended or otherwise, in which the ownership interests of a corporation are assigned directly or by operation of law to a person or persons, firm or corporation which acquires the control of the voting capital stock of such corporation or all or substantially all of the assets of such corporation. (c) A sale or transfer to an Affiliate of Franchisee owned or controlled by the present beneficial owners of Franchisee or members of their immediate family, or between members of the same immediate family,or transfers to a trust,testamentary or otherwise, in which the beneficiaries are limited to members of the transferor's immediate family. 8.5. Assumption of Obligations. No attempted Transfer of any of Franchisee's obligations hereunder shall be effective unless and until the successor party executes and delivers to City an assumption agreement in a form approved by the City assuming such obligations. Following any such assignment or Transfer of any of the rights and interests of Franchisee under this Agreement, the exercise, use and enjoyment shall continue to be subject to the terms of this Agreement to the same extent as if the assignee or transferee were Franchisee. 8.6. Release of Franchisee. City's consent to a Transfer shall not be deemed to release Franchisee of liability for performance under this Agreement unless such release is specific and in writing executed by City, which release shall not be unreasonably withheld. Upon the written consent of City to the complete assignment of this Agreement and the express written assumption of the assigned obligations of Franchisee under this Agreement by the assignee, Franchisee shall be relieved of its legal duty from the assigned obligations under this Agreement, except to the extent Franchisee is in default under the terms of this Agreement prior to said Transfer. Franchisee shall cooperate with the City and transferee or assignee to assist in an orderly transition of obligations and rights,including without limitation Franchisee timely providing route lists,billing information, etc.,to the transferee or assignee. 01203.0001/286603.5 30 8.7. Subcontracting. This Agreement, or any portion thereof, shall not be subcontracted except with the prior written consent of the City, which consent shall not be unreasonably withheld. No such consent shall be construed as making the City a Party to such subcontract, or subject the City to liability of any kind to any subcontractor. Franchisee shall submit all subcontracts for review and approval by the City and any permitted subcontract shall terminate on or before the termination of this Agreement. All subcontractors shall be licensed as required under State, Federal and local laws and regulations to perform their subcontracted work and obtain and maintain a City business license if required. No subcontract shall be valid unless the subcontractor has assumed, in writing, all of the subcontracted obligations hereunder. Franchisee shall remain otherwise liable for the full and complete performance of its obligations hereunder. 8.8. Heirs and Successors. The terms, covenants and conditions of this Agreement shall apply to and shall bind the heirs, successors, executors, administrators and assigns of the Franchisee and City. ARTICLE IX INSURANCE & INDEMNITY. 9.1. Insurance. Franchisee shall procure and maintain, at its sole cost and expense, in a form and content satisfactory to City, during the entire term of this Agreement including any extension thereof, the policies of insurance contained in Exhibit A hereto. 9.2. Indemnification. Without regard to the limits of any insurance coverage, Franchisee agrees to indemnify, defend with counsel appointed by the City, protect and hold harmless the City, its representatives, officers, agents and employees against any and all fines, response costs, assessments, actions, suits, injunctive relief, claims, damages to persons or property, losses, costs, penalties, obligations, errors, omissions or liabilities, ("claims or liabilities") that may be asserted or claimed by any person, firm or entity arising out of or in connection with(i)violations of the commerce clause of the U.S. Constitution,the Refuse Impact Reduction Laws, the Comprehensive Environmental Response, Compensation and Liability Act, Title 42 U.S.C. §9601 et seq. ("CERCLA"), HSAA, RCRA, any other Hazardous Waste laws, or other federal, state or local environmental statutes, ordinances and regulations which arise from this Agreement; (ii) the negligent performance of the work or services of Franchisee, its agents, employees, subcontractors, or invitees, provided for in this Agreement; (iii)the negligent acts or omissions of Franchisee hereunder, or arising from Franchisee's negligent performance of or failure to perform any term, provision, covenant or condition of this Agreement. The provisions of this Section do not apply to claims or liabilities occurring as a result of City's willful acts or omissions,but,to the fullest extent permitted by law, shall apply to claims and liabilities resulting in part from City's negligence. In connection herewith: (a) Franchisee will defend any action or actions filed in connection with any of said claims or liabilities and will pay all costs and expenses, including legal costs and attorneys' fees, incurred in connection therewith; (b) Franchisee will promptly pay any judgment rendered against the City, its officers, agents or employees for any such claims or liabilities arising out of or in 01203.0001/286603.5 31 connection with the negligent performance of or failure to perform such work or services of Franchisee hereunder; and Franchisee agrees to save and hold the City, its officers, agents and employees harmless therefrom; (c) In the event the City, its officers, agents or employees is made a party to any action or proceeding filed or prosecuted against Franchisee for such damages or other claims arising out of or in connection with the negligent performance of or failure to perform the work or services of Franchisee hereunder, Franchisee agrees to pay to the City, its officers, agents or employees,any and all costs and expenses incurred by the City,its officers,agents or employees in such action or proceeding, including but not limited to, legal costs and attorneys' fees. Franchisee shall incorporate similar indemnity agreements with its subcontractors and if it fails to do so Franchisee shall be fully responsible to indemnify City hereunder therefore, and failure of City to monitor compliance with these provisions shall not be a waiver hereof Franchisee's obligations hereunder shall survive the termination or expiration of this Agreement. 9.3. Refuse Impact Reduction Laws Guarantee and Indemnification. Without in any way limiting the indemnification provisions in Section 9.2 above, and subject to Public Resources Code Section 40059.1 as may be amended from time to time, Franchisee unconditionally guarantees compliance with the requirements of the Refuse Impact Reduction Laws as amended from time to time. Franchisee shall carry out its obligations under this Agreement so that the City will meet or exceed the Diversion requirements set forth in the Refuse Impact Reduction Laws, and all amendments thereto. City and Franchisee shall reasonably assist each other to meet the City's Diversion requirements under the Refuse Impact Reduction Laws. In carrying out the provisions of this Section, Franchisee agrees to perform the following obligations at its sole cost and expense: (a) Defend, with counsel approved by City, indemnify and hold harmless the City against all fines and/or penalties imposed by CalRecycle, if Franchisee fails or refuses to provide information relating to its operations which is required under this Agreement and such failure or refusal prevents or delays City from submitting reports required by the Refuse Impact Reduction Laws in a timely manner; (b) Assist City in preparing for, and participating in, any review of the City's Source Reduction and Recycling Element pursuant to Public Resources Code Section 41825; (c) Assist City in conducting any hearing conducted by CalRecycle relating to the Refuse Impact Reduction Laws,or in any other investigative or enforcement manner undertaken by any agency; (d) Defend, with counsel acceptable to City, and indemnify and hold harmless the City against any fines or penalties levied against it for violation of the Diversion requirements under the Refuse Impact Reduction Laws; (e) Cooperate with the City, should it seek to become its own enforcement agency,to the extent it may be permitted under state law. 01203.0001/286603.5 32 Franchisee shall incorporate similar guarantee and indemnity agreements with its subcontractors and if it fails to do so Franchisee shall be fully responsible to indemnify City hereunder therefore, and failure of City to monitor compliance with these provisions shall not be a waiver hereof. Franchisee's obligations hereunder shall survive the termination or expiration of this Agreement. ARTICLE X ACCOUNTING AND RECORDS. 10.1. Recordkeeping. Franchisee understands and agrees that it shall keep full and complete books, records and accounts of all financial transactions with respect to this Agreement. All such books, records and accounts shall be maintained for a minimum of five (5) years from and after the end of the fiscal year in which any such books, records and accounts are created. Records subject to this Section shall include paper, electronic, magnetic or other media including, but not limited to, records of recovered materials, marketing records, cash register records of purchases of Source Separated Recyclables, and video tape recordings of Franchisee operations, vehicular registration and maintenance records, Complaint logs, the log of uncollected materials, personnel files, customer correspondence and other correspondence, etc. 10.2. Financial Statement. City Manager or his/her designee may elect to review Franchisee' records and/or financial statements. Within ninety (90) Days of a City request, Franchisee shall allow the City Manager, his/her designee or an independent certified public accountant to review copies of financial statements at the Franchisee's local office (as defined in Section 4.2.1 hereof), or other such mutually-agreeable premises of Franchisee. City may request review or copying of other financial statements maintained by Franchisee, which may include, without limitation, comparative balance sheets, comparative operating statements, statements of changes in investments in property and equipment, statements of source and application of funds, and a statement of any changes in Franchisee's equity, in which shall be set forth the names of principal officers and stockholders of the corporation, and any other documents that may reasonably be requested by a certified public accountant acting in accordance with generally- accepted accounting principles, consistently applied. City and Franchisee agree to use reasonable efforts to protect the confidential nature of the Franchisee's financial statements. 10.3. Inspection of Franchisee's Other Accounts and Records. Franchisee's records of customer Complaints, Refuse Impact Reduction Laws compliance records, maps, billing records, gross income, franchise fee payments, customer payment histories, and any other records necessary to carry out this Agreement shall be available at the Franchisee's local office as set forth in Section 4.2.1 at any time during regular business hours for inspection on twenty-four(24)hours' notice, and/or performance of financial review of Franchisee's records by the City or its duly authorized representative in accordance with the Agreed Upon Procedures (as such term is associated with standard audit procedures), for a period of three (3) years following the close of the Franchisee's fiscal year. Franchisee shall provide City with a copy of any requested record at no cost to City. 10.4. Payments and Refunds. The City may annually perform an Agreed Upon Procedure of Franchisee's books and records. Should the performance of an Agreed Upon Procedure by the City disclose that the Franchise Fee or AB 939 Fee payable by the Franchisee 01203.0001/286603.5 33 was underpaid or that customers were overcharged for the period under review, Franchisee shall pay to City any underpayments of the Franchise Fee or AB 939 Fee and/or refund to Franchisee's customers any overcharges. Should the performance of an Agreed Upon Procedure by the City disclose that Franchise Fee or AB 939 Fee were overpaid, City shall promptly refund to Franchisee the amount of the overpayment. 10.5. Cost of Agreed Upon Procedures. Should the City's performance of Agreed Upon Procedures disclose that the Franchise Fee or AB 939 Fee payable by the Franchisee was underpaid by three percent(3%)or more,or that customers were overcharged by three percent(3%)or more, for the period under review, Franchisee shall pay for the cost of City's performing the Agreed Upon Procedures in addition to the reimbursing the City for the underpayment and/or refunded the Customers for their overpayment. ARTICLE XI ENFORCEMENT OF AGREEMENT. 11.1. California Law; Venue. This Agreement shall be interpreted, construed and governed both as to validity and to performance of the parties in accordance with the laws of the State of California. Legal actions concerning any dispute, claim or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Los Angeles, State of California, or any other appropriate court in such county, and Franchisee covenants and agrees to submit to the personal jurisdiction of such court in the event of such action. In the event of litigation in a U.S.District Court,venue shall lie exclusively in the Central District of California, in the County of Los Angeles, State of California. 11.2. Disputes;Default. In the event that Franchisee is in default under the terms of this Agreement, the City may give notice to Franchisee of the default and the reasons for the default. The notice shall include the timeframe in which Franchisee may cure the default. This timeframe is presumptively thirty (30) days, but may be extended, though not reduced, if circumstances warrant. If Franchisee does not cure the default, the City may take necessary steps to terminate this Agreement under this Article or to assess liquidated damages under Section 11.10. Any failure on the part of the City to give notice of the Franchisee's default shall not be deemed to result in a waiver of the City's legal rights or any rights arising out of any provision of this Agreement. 11.3. Waiver. Waiver by any party to this Agreement of any term,condition,or covenant of this Agreement shall not constitute a waiver of any other term, condition, or covenant. Waiver by any party of any breach of the provisions of this Agreement shall not constitute a waiver of any other provision or a waiver of any subsequent breach or violation of any provision of this Agreement. Acceptance by City of any services by or payments from Franchisee shall not constitute a waiver of any of the provisions of this Agreement. No delay or omission in the exercise of any right or remedy by a non-defaulting party on any default shall impair such right or remedy or be construed as a waiver. Any waiver by either party of any default must be in writing and shall not be a waiver of any other default concerning the same or any other provision of this Agreement. 11.4. Rights and Remedies are Cumulative. Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the parties are 01203.0001/286603.5 34 cumulative and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. 11.5. Legal Action. In addition to any other rights or remedies, either party may take legal action,in law or in equity,to cure, correct or remedy any default,to recover damages for any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Agreement. Notwithstanding any contrary provision herein, Franchisee shall file a statutory claim pursuant to Government Code Sections 905 et seq. and 910 et seq., in order to pursue a legal action under this Agreement. 11.6. Termination Prior to Expiration of Term. This Section shall govern any termination of this Contract. The City reserves the right to terminate this Contract at any time, with or without cause, upon thirty (30) days' written notice to Franchisee, except that where termination is due to the fault of the Franchisee, the period of notice may be such shorter time as may be determined by the City Manager. In addition,the Franchisee reserves the right to terminate this Contract at any time, with or without cause, upon one hundred and eighty(180) days' written notice to City, except that where termination is due to the fault of the City, the period of notice may be such shorter time as the Franchisee may determine. Upon receipt of any notice of termination, Franchisee shall immediately cease all services hereunder except such as may be specifically approved by the City Manager. In the event of termination without cause pursuant to this Section, the terminating party need not provide the non-terminating party with the opportunity to cure pursuant to Section 11.2. 11.7. City's Right to Perform or Transfer Service. In addition to any and all other legal or equitable remedies, in the event that Franchisee, for any reason whatsoever, fails, refuses or is unable to collect, transport or process any or all Solid Waste or Recyclables which it is required by this Agreement to collect and transport, at the time and in the manner provided in this Agreement, City may undertake such services through its own employees or contract with another Solid Waste Enterprise for the performance of such services. 11.8. Attorneys' Fees. If either party to this Agreement is required to initiate or defend or made a party to any action or proceeding in any way connected with this Agreement, the prevailing party in such action or proceeding,in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorney's fees. Attorney's fees shall include attorney's fees on any appeal, and in addition a party entitled to attorney's fees shall be entitled to all other reasonable costs for investigating such action,taking depositions and discovery and all other necessary costs the court allows which are incurred in such litigation. All such fees shall be deemed to have accrued on commencement of such action and shall be enforceable whether or not such action is prosecuted to judgment. 11.9. Cooperation Following Termination. At the end of the Term or in the event this Agreement is terminated for cause prior to the end of the Term, Franchisee shall cooperate fully with City and any subsequent contractor to assure a smooth transition of Solid Waste management services. Franchisee's cooperation shall include,but not be limited to,providing operating records needed to service all properties previously serviced by Franchisee under this Agreement. 01203.0001/286603.5 35 11.10. Remedies for Nuisance Violations; Liquidated Damages. 11.10.1 Liquidated Damages. In addition to any and all other legal or equitable remedies, in the event that Franchisee, for any reason whatsoever, produces any nuisance condition, City may assess liquidated damages against Franchisee in the following amounts: (a) $250 per Day for every Day the condition persists after City has given Franchisee written notice of the condition, for up to three (3) Days; (b) $350 per Day,beginning on the fourth Day and every Day thereafter that the condition either persists or recurs. 11.10.2 Nuisance Conditions. For purposes of this Section, the term "nuisance conditions" shall include,but is not limited to, the following: (a) Failure to duly collect Solid Waste and/or Recyclables that have been properly set out for Collection through the willful or negligent conduct of Franchisee employees; (b) Uncured damage to the property of third parties or customers through the willful or negligent conduct of Franchisee employees; (c) Legitimate Complaints of rude or unprofessional behavior or conduct by Franchisee's employees in the course of their duties; (d) Failure to perform route audits as required by Section 4.2.9 hereof; (e) Unreasonable leakage or spillage of Solid Waste or other collected materials from Franchisee's vehicles; (f) Failure to immediately or promptly collect Solid Waste or other materials that spilled or fell from Franchisee's vehicles onto public streets or third-party property; (g) Poor maintenance of Franchisee's vehicles, containers and equipment in violation of Sections 6.1 through 6.3 hereof; (h) Violations of personnel standards and qualifications in contravention of Section 6.4 hereof; (i) Any other failure to meet the Standards of Performance in Section 4.2 in such a manner as to give rise to a condition of public nuisance or threat to public health and safety. 11.10.3 Basis for Liquidated Damages. The Parties recognize that if Franchisee recurrently fails to prevent and remediate nuisance conditions,the City and its residents will suffer damages and that it is and will be impractical and extremely difficult to ascertain and determine the exact amount of damages which City and its citizens will suffer. Therefore, the Parties agree that the liquidated damages established herein represent a reasonable estimate of the amount of 01203.0001/286603.5 36 such damages for such specific violations,considering all of the circumstances existing on the date of this Agreement, including the relationship of the sums to the range of harm to City that reasonably could be anticipated and the anticipation that proof of actual damages would be costly or impractical. In placing their initials at the places provided, each Party specifically confirms the accuracy of the statements made above and the fact that each Party has had ample opportunity to consult with legal counsel and obtain an explanation of these liquidated damage provisions prior to entering this Agreement. Franchisee's Initials City Initials 1°1 4 11.11. Default for Criminal Activity. Franchisee shall be default of this Agreement should any of Franchisee's officers or directors have a criminal conviction from a court of competent jurisdiction for any offence related to Solid Waste activities, or for any other activity involving: (a) Fraud or a criminal offense in connection with obtaining,attempting to obtain, or performing a public or private agreement; or (b) Bribery or attempting to bribe a public officer or employee of a local, state, or federal agency in such person's official capacity; or (c) Embezzlement,racketeering,false claims, false statements, forgery, falsification or destruction of records, obstruction of justice, receiving stolen property, or theft. 11.12. No Waiver Of City's Police Powers Or Legal Rights. Nothing in this Agreement is intended to limit the power and ability of the City or any law enforcement agency to initiate administrative and/or judicial proceedings for the abatement of nuisance conditions or violations of any applicable law. Nothing herein shall waive or limit any other legal rights or recourses the City may have in response to Franchisee's repeated, material violations of the Standards of Performance in Section 4.2 or failure to mitigate nuisance conditions. ARTICLE XII GENERAL PROVISIONS. 12.1. Force Maieure. The time period(s) specified for performance of the provisions of this Agreement shall be extended because of any delays due to unforeseeable causes beyond the control and without the fault or negligence of the Franchisee, including,but not restricted to, acts of God or of the public enemy, unusually severe weather, fires, earthquakes, floods, epidemics, quarantine restrictions, riots, strikes, freight embargoes, wars, litigation, and/or acts of any governmental agency, including the City if the Franchisee shall within ten (10) Days of the commencement of such delay notify the City Manager in writing of the causes of the delay; no extension of time for performance shall be granted, however, by reason of the unavailability of any Disposal Site or by reason of strikes, lockouts, or other labor disturbances, or breakage or accidents to vehicles, equipment,machinery or plants. The City Manager shall ascertain the facts and the extent of delay, and extend the time for performing the services for the period of the enforced delay when and if in the judgment of the City Manager such delay is justified. In no event shall Franchisee be entitled to recover damages against the City for any delay in the 01203.0001/286603.5 37 performance of this Agreement, however caused, Franchisee's sole remedy being extension of the Agreement pursuant to this Section 12.1. 12.2. Notices. All notices, demands, requests, approvals, disapprovals, proposals, consents, or other communications whatsoever which this Agreement contemplates or authorizes, or requires or permits either Party to give to the other, shall be in writing and shall be personally delivered, sent by telecopier or sent by registered or certified mail,postage prepaid,return receipt requested, addressed to the respective Party as follows: If to Franchisee: California Waste Services Eric Casper, President 621 W. 152nd Street Gardena, CA 90247 800-839-5550 Fax 310-538-9040 eric@californiawasteservices.com Eric cell 310-962-9458 If to City: Director of Public Works City of Rancho Palos Verdes 30940 Hawthorne Blvd. Rancho Palos Verdes, CA 90275 Phone: (310) 544-5252 Fax: (310) 544-5292 Email: publicworks@rpvca.gov With copy to: Aleshire &Wynder, LLP 18881 Von Karman Avenue, Suite 1700 Irvine, CA 92612 Attention: Dave Aleshire, City Attorney or to such other address as either Party may from time to time designate by notice to the other given in accordance with this Section 12.2. Notice shall be deemed effective on the date personally served or by facsimile or, if mailed, three (3) Days from the date such notice is deposited in the United States mail. 12.3. No Liability of City Officials. No officer, employee or agent of the City shall be personally liable to the Franchisee, or any successor in interest, in the event-of any default or breach by the City or for any amount that may become due to the Franchisee or to its successor, or for breach of any obligation of the terms of this Agreement. 12.4. Proprietary Information: Public Records. The City acknowledges that a number of the records and reports of the Franchisee are proprietary and confidential. Franchisee is obligated to permit City inspection of certain of its records, as provided herein, on demand and to provide copies to City where requested. City will endeavor to maintain the confidentiality of all proprietary information provided by Franchisee and shall not voluntarily disclose such proprietary information. Notwithstanding the foregoing, any documents provided by Franchisee to City that are public records may be disclosed pursuant to a proper public records request. City shall notify 01203.0001/286603.5 38 Franchisee of any such request affecting Franchisee's records or reports at least five (5)business days prior to their release, to enable Franchisee to seek a protective order or otherwise prevent disclosure; provided, however, that City's failure to provide such notice shall not be a breach of this Agreement. 12.5. Conflict of Interest. No officer or employee of the City shall have any financial interest, direct or indirect, in this Agreement nor shall any such officer or employee participate in any decision relating to the Agreement which affects his financial interest or the financial interest of any corporation, partnership or association in which he is, directly or indirectly, interested, in violation of any State statute or regulation. 12.6. Interpretation. The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either Party by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply. Where the terms of this Agreement conflict with the City's municipal code, the municipal code shall govern. However, it shall not be deemed a conflict if this Agreement is narrower than, but not inconsistent with, the City's municipal code. 12.7. Integration; Amendment. It is understood that there are no oral agreements between the Parties hereto affecting this Agreement and this Agreement supersedes and cancels any and all previous negotiations, arrangements, agreements and understandings, if any, between the Parties, and none shall be used to interpret this Agreement. This Agreement may only be amended at any time by the mutual consent of the Parties by an instrument in writing. This Agreement is intended, in part, to carry out City's obligation to comply with the provisions of AB 939 and regulations promulgated thereunder, as amended from time to time. In the event that AB 939 or other state or federal laws or regulations enacted after this Agreement prevent or preclude compliance with one or more provisions of this Agreement, such provisions of this Agreement shall be modified or suspended as may be necessary to comply with such state or federal laws or regulations. No other amendment of this Agreement shall be valid unless in writing duly executed by the Parties. 12.8. Severability. In the event that part of this Agreement shall be declared invalid or unenforceable by a valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining portions of this Agreement which are hereby declared as severable and shall be interpreted to carry out the intent of the Parties hereunder unless the invalid provision is so material that its invalidity deprives either Party of the basic benefit of their bargain or renders this Agreement meaningless. 12.9. Corporate Authorization. The persons executing this Agreement on behalf of Franchisee hereto warrant that (i) they are duly authorized to execute and deliver this Agreement on behalf of said party, (ii) by so executing this Agreement, such party is formally bound to the provisions of this Agreement, and (iii) that entering into this Agreement does not violate any provision of any other Agreement to which said party is bound. 01203.0001/286603.5 39 IN WITNESS WHEREOF, the Parties hereto do hereby set their hands and seals as of the day and the year first written above. CITY OF RANCHO PALOS FRANCHISEE VERDES By 00: /k- /d)--Vdc, By: \Ssz �ns�i'Y-v—, President ATTEST: ity Clerk APPROVED AS TO FORM: By. , Vice President vatSHI' '' ii ER, LLP Dave Ale-'•e, City Attorney 01203.0001/286603.5 40 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached,and not the truthfulness,accuracy or validity of that document. STATE OF CALIFORNIA COUNTY OF LOS ANGELES a /401 ifs On (X - t O ,2016 before me '""�' ' ,personally appeared re-,^:c.- a-SPS'' proved to me on the basis of satisfactory evidence to be the person( whose names-is/aze subscribed to the within instrument and acknowledged to me that he/sheitherexecuted the same in his/herLtheic authorized capacityand that by his/her414eir signatur on the instrument the personor the entity upon behalf of which the persottcted,executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. ;, JOHN IC. CHO WITNESS my • S COMM.#2105705 sa. = ' Signature: NOTARY PUBLIC-CALIFORNIA C..- f✓ LOS ANGELES COUNTY vW My Comm.ExpiresA�r �2p 41� p OPTIONAL �'rl Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT ❑ INDIVIDUAL CORPORATE OFFICER (Lk mJ- r � 141,.,E,ORPE 9 DOC UME TITLE(S) Sr/"4``41 �I'1A/cA' 5 ❑ PARTNER(S)❑ LIMITED NUMBER OF PAGES ❑ GENERAL ❑ ATTORNEY-IN-FACT DATE OF DOCUMENT ❑ TRUSTEE(S) - ❑ GUARDIAN/CONSERVATOR SIGNER(S)OTHER THAN NAMED ❑ ABOVE OTHER SIGNER IS REPRESENTING: (NAME Of PERSON(S)OR ENTITY(IES)) EXHIBIT "A" INSURANCE COVERAGES Franchisee shall procure and maintain, at its sole cost and expense, in a form and content satisfactory to City, during the entire term of this Agreement including any extension thereof,the following policies of insurance which shall cover all elected and appointed officers, employees and agents of City: (a) Commercial General Liability Insurance. Franchisee shall maintain commercial general liability insurance with coverage at least as broad as Insurance Services Office form CG 00 01, in an amount not less than $2,000,000 per occurrence, $4,000,000 general aggregate, for bodily injury, personal injury, and property damage, and a $4,000,000 completed operations aggregate.The policy must include contractual liability that has not been amended.Any endorsement restricting standard ISO "insured contract"language will not be accepted. (b) Worker's Compensation Insurance. A policy of worker's compensation insurance in such amount as will fully comply with the laws of the State of California and which shall indemnify, insure and provide legal defense for the Franchisee against any loss, claim or damage arising from any injuries or occupational diseases occurring to any worker employed by or any persons retained by the Franchisee in the course of carrying out the work or services contemplated in this Agreement; and a policy of Employer's Liability Insurance with limits of at least $1,000,000. (c) Automobile Liability Insurance. Franchisee shall maintain automobile insurance at least as broad as Insurance Services Office form CA 00 01 covering bodily injury and property damage for all activities of the Franchisee arising out of or in connection with work to be performed under this Agreement, including coverage for any owned,hired,non-owned or rented vehicles used or operated by Franchisee,in an amount not less than$2,000,000 combined single limit for each accident, and endorsed to include pollution liability(written on form CA 99 48 or its equivalent). (d) Umbrella or Excess Liability Insurance. Franchisee shall obtain and maintain an umbrella or excess liability insurance that will provide bodily injury, personal injury and property damage liability coverage at least as broad as the primary coverages set forth above, including commercial general liability and employer's liability. Such policy or policies shall include the following terms and conditions: • A drop down feature requiring the policy to respond in the event that any primary insurance that would otherwise have applied proves to be uncollectable in whole or in part for any reason; • Pay on behalf of wording as opposed to reimbursement; • Concurrency of effective dates with primary policies; • Policies shall "follow form"to the underlying primary policies; 01203.0001/286603.5 A-1 • Must include a non-contributory and primary coverage endorsement; and • Insureds under primary policies shall also be insureds under the umbrella or excess policies. If the Franchisee maintains higher limits than the minimums shown above, the City requires and shall be entitled to coverage for the higher limits maintained by the Franchisee. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City. (e) Subcontractors. Franchisee shall include all subcontractors as insureds under its policies or shall furnish separate certificates and certified endorsements for each subcontractor. All coverages for subcontractors shall include all of the requirements stated herein. GENERAL INSURANCE REQUIREMENTS All of the above policies of insurance shall be primary insurance and shall name the City, its elected and appointed officers, employees and agents as additional insureds and any insurance maintained by City or its officers, employees or agents may apply in excess of, and not contribute with Franchisee's insurance. The insurer is deemed hereof to waive all rights of subrogation and contribution it may have against the City, its officers, employees and agents and their respective insurers. Moreover, the insurance policy must specify that where the primary insured does not satisfy the self-insured retention, any additional insured may satisfy the self-insured retention. All of said policies of insurance shall provide that said insurance may not be amended or cancelled by the insurer or any party hereto without providing thirty(30) days prior written notice by certified mail return receipt requested to the City. In the event any of said policies of insurance are cancelled,the Franchisee shall,prior to the cancellation date,submit new evidence of insurance in conformance with this Exhibit A to the City Manager. No work or services under this Agreement shall commence until the Franchisee has provided the City with Certificates of Insurance, additional insured endorsement forms or appropriate insurance binders evidencing the above insurance coverages and said Certificates of Insurance or binders are approved by the City. City reserves the right to inspect complete,certified copies of and endorsements to all required insurance policies at any time. Any failure to comply with the reporting or other provisions of the policies including breaches or warranties shall not affect coverage provided to City. All certificates shall name the City as additional insured (providing the appropriate endorsement) and shall conform to the following"cancellation"notice: CANCELLATION: SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATED THEREOF, THE ISSUING COMPANY SHALL MAIL THIRTY (30)-DAY ADVANCE WRITTEN NOTICE TO CERTIFICATE HOLDER NAMED HEREIN. 01203.0001/286603.5 A-2 [to be initialed] Franc 'see Initials City, its respective elected and appointed officers, directors, officials, employees, agents and volunteers are to be covered as additional insureds as respects: liability arising out of activities Franchisee performs;products and completed operations of Franchisee;premises owned,occupied or used by Franchisee; or any automobiles owned, leased, hired or borrowed by Franchisee. The coverage shall contain no special limitations on the scope of protection afforded to City, and their respective elected and appointed officers, officials, employees or volunteers. Franchisee's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. Any deductibles or self-insured retentions must be declared to and approved by City. At the option of City, either the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects City or its respective elected or appointed officers, officials, employees and volunteers or the Franchisee shall procure a bond guaranteeing payment of losses and related investigations,claim administration,defense expenses and claims. The Franchisee agrees that the requirement to provide insurance shall not be construed as limiting in any way the extent to which the Franchisee may be held responsible for the payment of damages to any persons or property resulting from the Franchisee's activities or the activities of any person or persons for which the Franchisee is otherwise responsible nor shall it limit the Franchisee's indemnification liabilities as provided in this Agreement. In the event the Franchisee subcontracts any portion of the work, the contract between the Franchisee and such subcontractor shall require the subcontractor to maintain the same policies of insurance that the Franchisee is required to maintain pursuant to this Exhibit A, and such certificates and endorsements shall be provided to City. Insurance required by this Agreement shall be satisfactory only if issued by companies qualified to do business in California,rated"A"or better in the most recent edition of Best Rating Guide,The Key Rating Guide or in the Federal Register,and only if they are of a financial category Class VII or better, unless such requirements are waived by the Risk Manager of the City("Risk Manager") due to unique circumstances. If this Agreement continues for more than 3 years duration, or in the event the Risk Manager determines that the work or services to be performed under this Agreement creates an increased or decreased risk of loss to the City, the Franchisee agrees that the minimum limits of the insurance policies may be changed accordingly upon receipt of written notice from the Risk Manager. 01203.0001/286603.5 A-3 EXHIBIT "B" NON-COLLUSION CERTIFICATION Franchisee warrants and represents that it has not paid or given, and will not pay or give, to any third party including,but not limited to, any City official, officer, or employee, any money, consideration, or other thing of value as a result or consequence of obtaining or being awarded any agreement. Franchisee further warrants and represents that(s)he/it has not engaged in any act(s), omission(s), or other conduct or collusion that would result in the payment of any money, consideration, or other thing of value to any third party including,but not limited to, any City official, officer, or employee, as a result of consequence of obtaining or being awarded any agreement. Franchisee is aware of and understands that any such act(s), omission(s) or other conduct resulting in such payment of money, consideration, or other thing of value will render this Agreement void and of no force or effect. Eric1 Cospev , Presides+ Name &Title Cal I toy-111R Wacfe Services LL C Name of Franchisee Signature & Date 01203.0001/286603.5 B-1