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Ordinance No. 2022-08 | Short-Term Interim Franchise Agreement w/ Recology | Adopted 08/15/2022ORDINANCE NO. 2022-08 AN URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF GILROY ADOPTING A SHORT-TERM INTERIM FRANCHISE AGREEMENT WITH RECOLOGY SOUTH VALLEY FOR SOLID WASTE HAULING SERVICES AND A FINDING THAT ITS ACTION IN ADOPTING THE ORDINANCE IS EXEMPT FROM REVIEW UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY ACT (“CEQA”) PURSUANT TO CEQA GUIDELINES SECTION 15061(B)(3) (COMMON SENSE EXEMPTION) IN THAT THE PROPOSED ORDINANCE WILL CONTINUE AN EXISTING STATE-MANDATED PROGRAM FOR THE PROTECTION OF PUBLIC HEALTH AND THE ENVIRONMENT, AND NONE OF THE CIRCUMSTANCES IN CEQA GUIDELINES SECTION 15300.2 APPLY WHEREAS, the City of Gilroy (City) is a municipal corporation, duly organized under the constitution and laws of the State of California; and WHEREAS, pursuant to California Constitution Article XI, Section 7, and the City Charter, Section 600, the City Council has the authority to enact ordinances which promote the public health, safety and general welfare of its residents, including sanitation ordinances and regulations; and WHEREAS, the provision of sanitary solid waste hauling services is an essential component to protecting public health, safety, and welfare, and is a state mandated service; and WHEREAS, solid waste hauling services are contracted through an exclusive franchise agreement, and enacted pursuant to Article XIII of the City Charter entitled “Franchises”; and WHEREAS, Section 1302 of Article XIII of the City Charter places a term limitation on franchise agreements at a maximum of 25 years; and WHEREAS, the existing franchise agreement was adopted on September 2, 1997, which establishes the 25-year limitation date to be up to and including September 2, 2022, necessitating a new franchise agreement by that date; and WHEREAS, the City has been in negotiations on a new franchise agreement with Recology South Valley, but has not yet reached a formal agreement which is inclusive of all the additional duties and requirements of recent state legislation regarding organics and recycling; and WHEREAS, a franchise agreement is required to continue providing solid waste hauling services, a state mandate, generating an urgent need to place a franchise agreement for solid waste hauling services into effect; and WHEREAS, failure to have a franchise agreement in effect for any period of time would cause garbage to accumulate within the City of Gilroy, which would cause a visual nuisance and noxious odors, and which could attract vermin and other pests, contribute to pollution, and facilitate the spread of disease-causing pathogens; and DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E Ordinance No. 2022-08 Short-Term Interim Franchise Agreement w/ Recology City Council Regular Meeting | August 15, 2022 Page 2 of 3 WHEREAS, the City and Recology South Valley have developed a short-term interim exclusive franchise agreement, attached as Attachment “A” and incorporated herein by reference, which retains essential services while a new franchise agreement is finalized and begins the first phase of implementing the organics and recycling requirements as imposed by recently adopted State law; and WHEREAS, adopting this Ordinance is exempt from review under the California Environmental Quality Act (“CEQA”) pursuant to CEQA Guidelines Section 15061(b)(3) (Common Sense Exemption) in that the proposed ordinance will continue an existing state- mandated program for the protection of public health and the environment, and none of the circumstances in CEQA Guidelines Section 15300.2 apply. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF GILROY DOES HEREBY ORDAIN AS FOLLOWS: SECTION I The foregoing recitals are true and correct and are incorporated herein by this reference. SECTION II That the short-term interim franchise agreement between the City and Recology South Valley, attached as Attachment “A” is hereby adopted. SECTION III This urgency ordinance, pursuant to Gilroy City Charter, Article VI, Section 602, is hereby declared by the City to be necessary as an urgent measure and shall take effect immediately and be in full force and effect after its approval and adoption based on the following: a. The City Council finds that the City is required to provide solid waste hauling services for the protection of public health and safety for reasons set forth in the recitals, and to meet legal obligations placed upon it by the State of California in furtherance of these two essential needs. b. The City Council finds that the provision of this service, as a utility, is to be provided by a franchise agreement as indicated in the City Charter. The City Charter limits franchise agreements to 25 years, of which the City’s current franchise agreement will reach the 25- year limit on September 2, 2022, before the next City Council meeting, and before a regular ordinance authorizing an exclusive franchise agreement can be in effect. Finalizing negotiations of a franchise agreement has been delayed by the negotiation of terms and conditions implementing the organics and recycling requirements as imposed by recently adopted State law. c. The City Council finds that the provision of services without a current franchise agreement is made a misdemeanor by the City Charter, which would prevent the City’s current solid waste hauler from providing its service to meet the City’s obligations relating to health, DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E Ordinance No. 2022-08 Short-Term Interim Franchise Agreement w/ Recology City Council Regular Meeting | August 15, 2022 Page 3 of 3 safety and general welfare of the public beyond September 2, 2022, therefore creating a public health threat. d. The City Council finds that the City has a franchise agreement in place, and a new one is being negotiated, but will not be ready in time for adoption as this urgency ordinance agreement, necessitating the short-term interim agreement proposed, and this ordinance to take effect immediately to complete the franchise agreement process to continue essential services during the intervening time until the negotiated franchise agreement can be finalized. SECTION IV If any section, subsection, sentence, clause or phrase of this Ordinance is for any reason held to be invalid or unconstitutional, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Gilroy hereby declares that it would have passed and adopted this ordinance, and each section, subsection, sentence, clause or phrase hereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases may be declared invalid or unconstitutional. SECTION V This Urgency Ordinance is adopted pursuant to Gilroy City Charter, Section 602. The City Clerk shall certify to the adoption of this Urgency Ordinance and cause the same to be published in the manner prescribed by law, and it shall become effective immediately upon its adoption. PASSED AND ADOPTED BY THE COUNCIL OF THE CITY OF GILROY this 15th day of August, 2022 by the following vote: AYES: COUNCIL MEMBERS: ARMENDARIZ, BRACCO, HILTON, LEROE-MUÑOZ, MARQUES, TOVAR, BLANKLEY NOES: COUNCIL MEMBERS: NONE ABSTAIN: COUNCIL MEMBERS: NONE ABSENT: COUNCIL MEMBERS: NONE APPROVED: Marie Blankley, Mayor ATTEST: _______________________ Thai Nam Pham, City Clerk DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E CERTIFICATE OF THE CLERK I, THAI NAM PHAM, City Clerk of the City of Gilroy, do hereby certify that the attached Ordinance No. 2022-08 is an original ordinance, or true and correct copy of a city Ordinance, duly adopted by the Council of the City of Gilroy at a Regular Meeting of said held on Council held Monday, August 15, 2022, at which meeting a quorum was present. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Official Seal of the City of Gilroy this Monday, August 15, 2022. ____________________________________ Thai Nam Pham, CMC, CPMC City Clerk of the City of Gilroy (Seal) DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E SHORT TERM INTERIM FRANCHISE AGREEMENT BETWEEN THE CITY OF GILROY AND RECOLOGY SOUTH VALLEY FOR SOLID WASTE AND RECYCLING SERVICES Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E Table of Contents INTERIM FRANCHISE AGREEMENT ......................................................................................................3 1)Definitions ......................................................................................................................................... 4 2)Conditions to Effectiveness of Agreement ....................................................................................... 6 3)Contractor Status and Authorization ................................................................................................ 6 4)Scope of Contractor's Services .......................................................................................................... 6 5)Contractor's Equipment and Personnel .......................................................................................... 10 6)Rights and Obligations Affecting Customers................................................................................... 12 7)City's Responsibilities ...................................................................................................................... 12 8)Exclusivity ........................................................................................................................................ 12 9)Recordkeeping and Reports ............................................................................................................ 13 10)Rates and Charges ....................................................................................................................... 14 11)Payments ..................................................................................................................................... 15 12)Performance Audits and Liquidated Damages ........................................................................... 16 13)Relationship of Parties ................................................................................................................ 17 14)Guaranty ..................................................................................................................................... 18 15)Insurance ..................................................................................................................................... 19 16)Assignment .................................................................................................................................. 19 17)Dispute Resolution ...................................................................................................................... 19 18)Term and Termination of Agreement ......................................................................................... 19 19)Notices ........................................................................................................................................ 21 20)Miscellaneous Provisions ............................................................................................................ 21 EXHIBIT "A" – Collection Schedules and Rules .................................................................................. 24 EXHIBIT "B" – Container Specifications and Rules .............................................................................. 26 EXHIBIT “C” – Extra Pickup and Other Special Services ...................................................................... 27 EXHIBIT "D" – Customer Service Standards ....................................................................................... 31 EXHIBIT "E" – Collection Vehicle Specifications ................................................................................. 33 EXHIBIT "F" – Monthly Reports ......................................................................................................... 34 EXHIBIT "G" – Approved Collection and Special Service Rates ............................................................ 35 EXHIBIT "H" – Form of Monthly Billing and Collection Report ............................................................ 39 EXHIBIT "I" – Liquidated Damages for Failure to Perform .................................................................. 40 EXHIBIT "J" – Guaranty of Performance ............................................................................................ 41 EXHIBIT "K" – Required Insurance Coverages .................................................................................... 43 Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E INTERIM FRANCHISE AGREEMENT This Interim Agreement (“Agreement”) is made and entered into this 15th day of August, 2022 ("Effective Date") by and between the CITY OF GILROY ("City"), a municipal corporation of the State of California, and RECOLOGY SOUTH VALLEY ("Contractor"), a California corporation. City and Contractor are sometimes collectively referred to herein as the "parties". This Agreement is made with reference to the following facts: A) City and Contractor are currently parties to an agreement dated September 2, 1997 by which City granted to Contractor, whose corporate name at the time was South Valley Disposal & Recycling, Inc., the franchise to collect, transport and dispose of garbage and refuse produced within the corporate limits of City for the benefit and in the interest of the health, safety and welfare of its citizens. That agreement was amended by that certain first amendment dated as of July 6, 1999 (the “First Amendment”), as amended by that certain second amendment dated June 19, 2000 (the “Second Amendment”), as amended by that certain third amendment dated July 1, 2014 (the “Third Amendment”), as amended by that certain fourth amendment dated June 20, 2022 (the “Fourth Amendment”) and, as amended, is referred to herein as the "Prior Agreement". The franchise granted by the Prior Agreement will terminate on August 31, 2022. B) The parties mutually desire to enter into a new interim franchise as negotiations complete on a more comprehensive franchise agreement. This Agreement includes the initial expansion and implementation of obligations of Contractor relating to, among other things, Phase 1 of the Commercial Generator Desktop Compliance Reviews for Senate Bill 1383 (“SB 1383”), Assembly Bill 1826 (“AB 1826”), and Assembly Bill 341 (“AB 341”) (collectively, “State Legislation”) compliance, as well as outreach and education for the State Legislation, as more particularly set forth in this Agreement’s Exhibit “C”. The City had previously implemented a Source Reduction and Recycling Element as part of its general plan which contains a series of programs designed to achieve the diversion goals of the California Integrated Waste Management Act of 1989 (Public Resources Code Sections 40000 et seq.), and it is the intention of Contractor and City, through the continued operation of those programs established during the Prior Agreement, in addition to those contained in this Agreement, to continue working together to achieve those goals. C) Pursuant to powers expressly granted to cities and counties in Article XI, Section 7 of the California Constitution, and also set forth in California Public Resources Code Section 40059, Franchisor has the authority within its jurisdiction to regulate the handling of solid waste. D) City has determined that it is in the best interests of City and its citizens to contract with Contractor for an integrated waste management program for residential and commercial premises within the corporate limits of City for the benefit and in the interest of the health, Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E safety and welfare of its citizens. City has selected Contractor as its exclusive franchisee to provide to City the services required for this integrated waste management program subject to the provisions, terms and conditions set forth in this Agreement, and Contractor desires to provide to City such services, which it represents to City that it has the necessary expertise, resources, licenses and permits to provide in accordance with the provisions, terms and conditions of this Agreement. NOW, THEREFORE, in consideration of the factual premises and the covenants and conditions set forth in this Agreement, City and Contractor hereby agree as follows: 1) Definitions. For the purposes of this Agreement, certain words and terms shall be construed as hereinafter set forth, unless it is apparent from the context that a different meaning is intended. A) "Affiliate" means all businesses (including corporations, limited and general partnerships, limited liability companies, and sole proprietorships) which are directly or indirectly related to Contractor by virtue of direct or indirect ownership interest or common management. Such businesses shall be deemed to be "Affiliated with" Contractor and included within the term "Affiliates" as used herein. An Affiliate shall include a business in which Contractor owns a direct or indirect ownership interest, a business which has a direct or indirect ownership interest in Contractor 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 Contractor. B) "Bulky Goods" means discarded furniture, carpets, mattresses, household appliances including refrigerators, ranges, washers, dryers, water heaters, dishwashers and other similar items (sometimes referred to as “White Goods"), and electronic equipment such as stereos, televisions, computers, VCRs and similar items, and tires (but not other automotive equipment or parts). C) "Commercial Customer" means any person or legal entity which conducts a trade or business in City and receives collection and other services described in this Agreement. D) "Curbside" means on or near a curb forming the side of a street. E) "Hazardous Material" means any material or combination of materials which, because of its quantity, concentration or physical, chemical or infectious characteristics may either (i) cause or significantly contribute to an increase in mortality or an increase in serious irreversible, or incapacitating reversible illness, or (ii) pose a substantial present or potential hazard to human health or environment when improperly treated, stored, transported or disposed of or otherwise managed. Hazardous Material also includes hazardous wastes as defined under California or Federal law or regulations promulgated pursuant to any such law, as such law or regulations may from time to time be amended. It is agreed and understood that neither Contractor nor City shall be deemed Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E to be the generators of such Hazardous Material. Instead, Contractor’s customers shall be deemed the generators of the Hazardous Material. F) "Mixed Paper" means newspaper (including inserts) other paper products (including magazines, catalogs and junk mail), corrugated cardboard, brown Kraft bags, paper board, paper egg cartons, office ledger paper, envelopes and stationery, computer paper, phone books, cereal boxes, shoe boxes and other similar paper products, and such other items as may be agreed upon by the parties from time to time. G) “Multi-Family Bin Customer” means any person, including owner or occupant, who resides in City in a multi-family residential complex and receives bin refuse collection service. H) "Multi-Family Can Customer" means any person, including owner or occupant, who resides in City in a multi-family residential complex and receives can refuse collection service. I) "Recyclable Materials" means "Mixed Paper" and glass, metal cans (including aluminum and de-labeled tin), used motor oil (up to a maximum of three (3) gallons per Residential Customer set out per week), used automobile motor oil filters, PEIB (polyethylene terephthalate) bottles and containers, HDPE (high density polyethylene) containers, bi- metal containers, and such other materials as may from time to time be mutually agreed upon in writing by Contractor and City. J) "Recycling Containers" means the receptacles provided by Contractor to Residential Customers and Multi-Family Can Customers for the disposal of Mixed Paper and other Recyclable Materials in accordance with this Agreement. "Recycling Containers" also means any other receptacle which is provided by a customer for collection of Recyclable Materials or Yard Waste and which is approved for such purpose by Contractor and City and appropriately labeled as a recycling container. K) "Refuse" shall mean all putrescible and non-putrescible solid, semisolid and/or liquid wastes, including garbage, trash, refuse, paper, rubbish, ashes, industrial wastes, demolition and construction wastes, discarded home and industrial appliances, vegetable or animal solid or semisolid wastes, and all wastes capable of being recycled that are commingled with other waste. Refuse also means any other item defined as "Refuse" in Section 12.1 of the Code of the City of Gilroy California, as such code is amended from time to time during the term of this Agreement ("Code"). The term "Refuse" shall not include Hazardous Materials, source-separated Recyclable Materials, Yard Waste or stable matter (manure and other waste material normally accumulated in stables or in livestock or poultry enclosures). Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E L) "Refuse Containers" means the 32, 64 or 96-gallon refuse receptacles provided by Contractor to Residential Customers or Multi-Family Can Customers for the disposal of Refuse in accordance with this Agreement. M) "Residential Customer" means any person, including owner or occupant, who resides in City in a single-family residence. N) "Yard Waste" means leaves, grass cuttings, weeds, vines, shrubbery, brush and tree trimmings, but not tree limbs over two (2) inches in diameter. "Yard Waste" does not include palm leaves, succulents, dirt, concrete or other refuse. Yard Waste also includes all items defined as "Garden Refuse" in Section 12.24 of the Code. When combined with food waste, “Yard Waste” is hereafter referred to as “Organic Waste”. O) "Yard Waste Containers" means the 96-gallon receptacles provided by Contractor to Residential Customers for the disposal of Yard Waste in accordance with this Agreement. 2) Conditions to Effectiveness of Agreement. The obligation of City to permit this Agreement to become effective and to perform its undertakings provided for in this Agreement is subject to the satisfaction of each and all of the conditions set out below, each of which may be waived in whole or in part by City: A) Accuracy of Representations. Representations and warranties, made by Contractor throughout this Agreement are accurate, true and correct on and as of the effective date of this Agreement. B) Furnishing of Insurance and Bonds. Contractor has furnished the insurance and bonds required by this Agreement. C) Effectiveness of City Council Action. City's action approving this Agreement shall have become effective pursuant to California law. 3) Contractor Status and Authorization. Contractor is duly organized, validly existing and in good standing under the laws of the State of California. It is qualified to transact business in the State of California and has the power to own its properties and to carry on its business as now owned and operated and as required by this Agreement. Contractor has the authority to enter into and perform its obligations under this Agreement. The Board of Directors or partners of Contractor (or the shareholders, if necessary) have taken all actions required by law, its articles of incorporation, its bylaws or otherwise to authorize the execution of this Agreement. The Persons signing this Agreement on behalf of Contractor have authority to do so. 4) Scope of Contractor's Services. A) In General. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E i) During the term of this Agreement, Contractor shall have the sole and exclusive authority and obligation to collect, remove and dispose of all Refuse from Residential Customers, Multi-Family Bin Customers, Multi-Family Can Customers and Commercial Customers in accordance with the terms and conditions of this Agreement. In order to ensure that Contractor is able to provide service to all residents of the City, City shall notify Contractor in writing within ten (10) days of every new customer who subscribes for water utility service from the City. ii) In addition, during the term of this Agreement, Contractor shall have the sole and exclusive authority and obligation to collect, remove and recycle all Recyclable Materials and Yard Waste from (1) all Residential Customers, (2) all Multi-Family Can Customers and (3) Commercial Customers and Multi-Family Bin Customers who have subscribed for recycling services described in this Agreement in accordance with the terms and conditions of this Agreement. Notwithstanding the authority granted to Contractor herein, any Commercial Customer and Multi-Family Bin Customer or Multi-Family Bin Customer may contract with an independent third party for recycling services, provided that the independent third party receives no compensation of any kind in connection with the provision of such services. iii) Contractor's services will not include the collection or handling of Hazardous Material, but if Contractor picks up identifiable Hazardous Material, Contractor shall dispose of it properly and in accordance with all applicable laws and regulations. iv) Contractor shall, at its sole cost and expense, except as otherwise provided herein, furnish all labor, equipment and facilities required to perform all services required by this Agreement. v) Contractor shall maintain appropriate equipment and weigh all Refuse and Recyclable Materials collection vehicles at the transfer station and at the landfill disposal site. Information regarding load weights shall be included in the monthly reports described in Section 9(a) of this Agreement. B) Collection Schedule. Unless otherwise authorized by City in writing, Contractor shall collect Refuse, Mixed Paper, Recyclable Materials and Yard Waste in accordance with the applicable collection schedules and rules set forth in Exhibit "A" attached hereto and incorporated herein by this reference. Contractor's schedules and routes shall be made in consultation with the City. C) Containers. Contractor shall purchase, provide and deliver to customers all Refuse Containers, Recycling Containers, Yard Waste Containers and other approved receptacles for the integrated waste management program services described in this Agreement. The types, sizes and colors of the containers, and the printed labels placed on the containers, shall be subject to the approval of City. The types, sizes, colors, labels Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E and additional rules regarding such containers are described in Exhibit "B" attached hereto and incorporated herein by this reference. D) Service To Elderly and Disabled Residents. Residents who, by reason of age or disability, are unable regularly to place their containers at the curb shall have the option of placing their containers near their dwelling, visible from curbside, and Contractor will pick up solid waste at this location and return the container to same location. Authorization for residents to participate in this optional program shall come from the Contractor upon request. Contractor will notify all residents of this option annually, beginning within thirty (30) days of effectiveness of this Agreement. New customers shall be notified of this option upon requesting service. E) Disposal and Recycling Services. i) City shall have the right to direct Contractor to deliver Refuse to a landfill or other waste management facility designated by the City provided that the landfill or other waste management facility has agreed to accept waste from the City. If the City does not choose to exercise this right, Contractor shall select and use landfill sites for the transportation, sorting and disposal of Refuse, which sites must be reasonably acceptable to the City. ii) Contractor shall collect, transport, sort, process, store, dispose of and recycle or sell Mixed Paper, Recyclable Materials and Yard Waste collected from customers in compliance with applicable federal, state and local laws and regulations governing the collection, storage, processing, re-transport and recycling or disposal of such items. Upon request from the City, Contractor shall identify the entity to which it transfers Recyclable Materials and Yard Waste for processing. Recyclable Materials and Yard Waste that has been segregated and collected as such shall not be disposed of at landfill sites without the approval of the City, which approval shall not be unreasonably withheld. The parties agree that, without limitation, it would be unreasonable to withhold agreement if no person or entity is reasonably available which will provide the service of recycling the materials. iii) The City approvals regarding the manner and means of disposal and recycling that are required by this Section shall be obtained prior to the commencement of Contractor's services under this Agreement and prior to any change in the previously approved manner or means of disposal or recycling. F) Other Special Services. i) Contractor shall provide the additional services described in Exhibit "C" attached hereto and incorporated herein by this reference. Such services shall be provided at no extra charge to the customers, except as otherwise provided in Exhibit "C" or in any other Section of this Agreement. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E ii) Contractor shall provide, at no charge to City, collection, disposal and recycling services to: (a) facilities owned, leased or operated by City, including the City Hall complex, police and fire stations, Community Center, Corporation Yard, parks and recreational facilities, including the golf course, Senior Center, Youth Center and other similar or related facilities; (b) civic refuse programs conducted by City, including City sponsored clean-up events and similar programs, to a maximum of six (6) events with the provision of two (2) 20-yard bins per event; and (c) construction and demolition projects on City property and involving City facilities. The free recycling, civic programs and City projects services shall be on an "as needed" basis and shall be completed at times and in a manner agreed to by City and Contractor. Contractor shall also provide free dumping privileges by City for Refuse and debris from City facilities, programs and projects at the designated landfill. G) Disaster Assistance. In the event of wartime or natural, physical or other disasters resulting in the declaration of a state of emergency by duly authorized authorities which affect the areas in which Contractor's services are to be performed, Contractor shall make available to City, at no cost to City, Contractor's equipment and personnel for emergency operations to be conducted or directed by City's emergency organization. City shall have the right to possess such equipment and temporarily borrow Contractor's personnel as reasonably required for City to conduct required operations under the direction and control of City's chief of disaster operations. Contractor shall also provide to City such additional equipment and personnel as may be reasonably available to Contractor to accomplish effective Refuse and debris removal during any declared state of emergency. H) Promotion of Recycling Program and Services. i) Contractor shall use reasonable efforts to support and promote the City’s Recycling Programs, and shall develop and implement promotional and enforcement programs to educate, encourage and attain compliance from the public in the use of recycling and organic waste services, as described in Exhibit "C" hereto. Contractor shall contact customers during the term of this Agreement as needed to promote and solicit compliance with recent State Legislation. Contractor shall furnish to City at the end of the calendar year during the term of this Agreement a report identifying the compliance level of customers with State Legislation. City will cooperate with Contractor by allowing Contractor's use of the City newsletter and public access cable television channel for Contractor's promotional program. City shall have the right to review and consult with respect to all written materials prepared by Contractor for publication or distribution by Contractor in connection with Contractor's recycling program and other special services. ii) Contractor will use its best efforts to render regular recycling and organic waste services in accordance with this Agreement to all required Customers. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E I) Contractor Representative. Contractor shall designate a responsible employee with qualifications reasonably acceptable to City to be the responsible contractor representative with City in connection with this Agreement. Contractor's representative shall be available for communications with City regarding this Agreement during regular business hours. Unless otherwise stated herein, communications required or permitted to be given or addressed to City shall be given or addressed to the City Administrator or to other City officials who may be designated from time to time or for certain purposes hereunder by the City Administrator. J) Customer Service Standards. During the term of this Agreement, Contractor shall maintain the Customer Service Standards which are described in Exhibit "D" attached hereto and incorporated herein by this reference. K) Non-Discrimination. Contractor shall not discriminate against any person on the basis of any characteristic identified in Civil Code Section 51, as the same may be renumbered or amended from time to time, or on any other basis prohibited by state or federal law or City ordinance. L) Service Goals. i) Contractor shall cooperate with City in the establishment, at least annually, or more frequently if requested by City, of service goals for (1) recycling and special services which will enable Contractor to increase public support and use of these services and to meet or exceed Contractor's warranty regarding commercial recycling set forth in Section 4(h)(ii), (2) quality of customer service which will enhance customer satisfaction and reduce or limit liquidated damages that may be assessed in accordance with Section 12(b), and (3) disposal reduction and diversion which will enable City to achieve and exceed the State mandated levels. ii) If established service goals are not met, at City's request, Contractor shall prepare and submit to City for its review and approval a plan of action to meet such goals. If established service goals are not met, Contractor shall use due diligence and best efforts to increase the amount and enhance the effectiveness of the services required under this Agreement. If the parties agree that new and additional kinds of services are required, Contractor and City shall negotiate the terms and conditions for providing such new services, including an adjustment to the permitted rates and charges under this Agreement. If quality of customer service goals established pursuant to subsection (L)(i)(2) of this Section are not met, City may increase corresponding liquidated damages up to one hundred percent (100%) for a period of up to one (1) year. 5) Contractor's Equipment and Personnel. A) Collection Equipment. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E i) All items collected under this Agreement shall be conveyed in well-maintained modern equipment, so constructed and so loaded that there will not be any leakage or loss of such items from the equipment. All tools, vehicles and receptacles utilized by Contractor in performing the services under this Agreement shall be of a type capable of handling such Refuse, Recyclable Materials and Yard Waste for which they are used and shall be kept clean and in a good state of repair. ii) Contractor's collection vehicles shall be identified, painted and subject to inspection and other rules as set forth in Exhibit "E" attached hereto and incorporated herein by this reference. B) Ownership of Equipment. All equipment and personal property used by Contractor in the performance of this Agreement shall be owned by Contractor; however, Contractor may lease vehicles if the leases are for not more than five (5) years and there are no residual costs, but the specific leasing arrangements shall provide that in the event of default, City, at its option, shall have the right to take possession of and operate said equipment and property in the event Contractor shall fail, refuse or neglect for any reason to collect and properly process and dispose of Refuse, Recyclable Materials and Yard Waste, as required by this Agreement. Contractor's equipment and personal property shall not be encumbered in a manner that would interfere with the City's rights under this Section. Any lease entered into by Contractor pursuant to this Section with an affiliate shall not contain terms and conditions more favorable to the affiliate than the terms and conditions of leases generally available from unrelated third parties. C) Contractor's Failure to Perform. In the event that Contractor shall fail, refuse or neglect for any reason to collect and properly process and dispose of or recycle items as required by this Agreement for a period in excess of seventy-two (72) consecutive hours, City may collect and process the same, or cause the same to be collected, processed and disposed of or recycled, and Contractor shall be liable for the expense incurred by City. This right of City shall be cumulative and in addition to any and all other remedies it may have in the event of any such failure, refusal or neglect of Contractor. City may, during any such period of failure, refusal or neglect by Contractor, take possession of Contractor's equipment and personal property used for the collection, processing and disposal or recycling of the Refuse, Recyclable Materials and Yard Waste and employ such forces as it may deem advisable to continue the required collection, processing, disposal and recycling services. The cost of all labor, materials and equipment necessary for City to perform such required services, under those conditions, shall be paid by Contractor and may be deducted and retained by City from any monies then due or to become due to Contractor under or by virtue of this Agreement. City's performance of any such services under those circumstances shall not be deemed an election of remedies and shall not preclude City from seeking any other available remedies. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E D) Labor Disputes. Contractor shall promptly report to City any knowledge of Contractor that an actual or potential labor dispute is delaying or threatening to delay the performance of Contractor under this Agreement, and Contractor shall disclose all relevant information with respect thereto. 6) Rights and Obligations Affecting Customers. A) Container Requirements. City shall use best efforts to require, by ordinance or otherwise, that all customers receiving refuse or recycling services from Contractor use the receptacles provided by Contractor for the purposes intended. B) Storage and Collection Requirements. City shall use best efforts to require, by ordinance or otherwise, that all customers receiving services pursuant to this Agreement store and set out Refuse Containers, Recycling Containers and Yard Waste Containers and other approved receptacles at the times and in the manner required as part of the collection program operated by Contractor and approved by City. C) Ownership of Recyclable Materials. From the time of placement of Recyclable Materials at Curbside, or other approved collection locations, Recyclable Materials shall become the property of Contractor; provided, however, that the customer who placed those items for collection may retrieve such items as desired prior to collection. 7) City's Responsibilities. A) Public Awareness Program. City agrees to conduct and participate in public education programs to encourage recycling, including organic waste recycling programs. B) Protection of Contractor's Rights in Recyclable Materials. City agrees reasonably to assist Contractor in protecting Contractor's ownership of the Recyclable Materials placed at Curbside or other approved collection locations. C) Assistance with Permits. City agrees to assist Contractor, to the extent reasonably possible, in Contractor's obtaining such permits and licenses as may be required for Contractor's performance of its services under this Agreement. 8) Exclusivity. A) City agrees that Contractor shall have the exclusive right, authority and franchise to provide the services described in this Agreement, subject to certain exceptions set forth below. Subject to those exceptions, City shall not award any contract to, or enter into any contract with, any other person or organization for the performance of services required to be performed by Contractor. B) The right and authority of Contractor hereunder shall be exclusive, except with respect to the following: Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E i) Hauling of Refuse or Yard Waste that is provided incidental to the provision of other goods or services and without the use of a Refuse Container, bin or debris box, such as the hauling of Yard Waste by a landscaper, the hauling of tree trimmings by a tree service, the hauling of construction debris by a construction contractor and the hauling of used Bulky Goods by the seller of such goods; ii) Collection and disposal of Recyclable Materials from Commercial Customers if the transaction does not result in a payment or other consideration to the hauler of such materials by the Commercial Customer who generated the Recyclable Materials; and iii) Collection and disposal of tallow, restaurant grease and such other commercial bi- products and other non-salable material from commercial premises upon which the parties may from time to time agree. 9) Recordkeeping and Reports. A) Monthly Reports. During the term of this Agreement, Contractor shall furnish to City monthly reports, due within fifteen (15) days after the end of each month, providing the information that is described in Exhibit "F" attached hereto and incorporated herein by this reference and such other information that is required by City and the terms of this Agreement to be included in the monthly reports. B) Annual Financial Reports. Contractor shall provide to the City annually, within one hundred and eighty (180) days after the end of each of Contractor's fiscal years ending during the term of this Agreement, Contractor's audited financial statements, including footnotes and accountant's letter. Unaudited financial statements shall be provided within sixty (60) days after the end of each of such fiscal years. In connection with any such review by City, Contractor shall respond to any questions of City concerning Contractor's financial ability to perform its obligations under this Agreement. Upon request, Contractor will provide all information reasonably requested with respect to any transactions between the Contractor and any Affiliate. C) Financial Records. Contractor shall maintain financial books and records, according to generally accepted accounting principles, for each year, and for each of the preceding five (5) years, during the term of this Agreement. These books and records shall reflect all business operations of Contractor under this Agreement and shall be available to City for review at all reasonable times during regular business hours. The books and records shall include accurate data regarding Contractor's revenues from and costs to perform all of its services under this Agreement and shall reflect accounting for costs attributable to the provision of services under this Agreement separate from accounting for costs attributable to the provision of services in any other jurisdiction. Without limiting any of the City’s rights and remedies under this Agreement, it is agreed and understood that Contractor's failure to maintain and make available for City's review the required books and records may be cause for termination of this Agreement by City. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E 10) Rates and Charges. A) In General. i) The allowable compensation for Contractor's services relating to the performance of its obligations under this Agreement is subject to determination by City pursuant to the Code and the procedures set forth herein. Contractor understands that the rates described in this Agreement constitute the full and sole compensation for the services of Contractor under this Agreement. No other or additional charges shall be made or payments shall be sought and/or accepted by Contractor either from City or from any other person for any of Contractor's services in performing its obligations under this Agreement, except for revenues which Contractor receives from the sale of Recyclable Materials. ii) The rates identified in Exhibit G of this Agreement will remain in place through the term of this Agreement, until a new franchise agreement is adopted and made effective. B) Collection Rates. The maximum permitted rates which may be charged for Contractor's collection, disposal and related services hereunder during the Agreement are set forth in Exhibit "G" attached hereto and incorporated herein by this reference. C) Special Service Rates. Special rates which may be charged for Contractor's extra pickup and other special services are set forth in Exhibits "C" and "G" attached hereto. Unless charges are specifically authorized herein, Contractor's pickup and other special services will be without charge to customers or City. D) Special Requests for Extraordinary Rate Adjustments. i) Contractor shall have the option of filing a special request, with supporting documentation, for an adjustment to the rates to recover any significantly increased costs that Contractor can demonstrate have resulted from extraordinary and unanticipated changes in circumstances occurring during the term of this Agreement, such as the unavailability of or changes in landfill disposal sites that have been approved by City, changes in laws or regulations, new or increased taxes or fees imposed by a governmental agency, or other extraordinary events or circumstances beyond the reasonable control and anticipation of Contractor. However, the fact that economic conditions or operating assumptions made by Contractor when entering into this Agreement do not turn out as anticipated by Contractor is not alone a valid basis for a request for adjustment by Contractor under this section. Any such adjustment in the rates shall be subject to the discretion of the City Council of City and shall be based upon evidence of the increased costs to Contractor of performing its required services under this Agreement (and shall take into consideration Contractor's revenues). Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E ii) City shall not be responsible for any damages to Contractor as a result of City's failure to approve a rate increase to which Contractor is otherwise entitled pursuant to this Agreement; provided, that any rate increase that is enacted after the date on which enactment is otherwise required under this Agreement shall be calculated to permit Contractor to recover the full amount of revenue that Contractor would have received had the rate increase been enacted in a timely manner. iii) If Contractor requests a rate adjustment due to changes in circumstances relating to landfill disposal sites, City shall have the option of providing a substitute landfill disposal site, at City's expense, and adjusting Contractor's approved rates by an amount fairly equivalent to Contractor's changed costs, if any, as a result of the use of the substitute landfill disposal site provided by City. Upon City's request, Contractor shall submit to City evidence satisfactory to the City in the City’s reasonable discretion of Contractor’s costs attributable to the use of the landfill disposal sites for which City may provide a substitute. E) Rate Adjustments Relating to Landfill Direction. If City has directed Contractor to deliver Refuse to a landfill or other waste management facility, Contractor and City shall negotiate a fair and reasonable adjustment to service rates and charges that reflect all of the cost increases or decreases resulting from the City' s direction of the waste. Costs to be included in the negotiation include, but are not limited to, tipping fees, labor, fuel, and equipment. 11) Payments. A) Customer Billings and Collections. Contractor, at its own expense, shall perform all customer billing services, which shall be on a quarterly cycle, and all collection of charges billed in connection with Contractor’s services to customers described in this Agreement prior to the customer billings being assigned to City as provided for by subsection (B) below. A summary of all billings to customers and collections of charges during each month shall be furnished to City at least monthly, not later than the fifteenth (15th) day of the following month, during the term of this Interim Agreement. The billing summary shall include all of the information set forth in Exhibit "H". B) Nonpayment By Customers. Contractor may assign its customer billings to City as provided for by Government Code sections 25831 and 38790.1 and the Gilroy City Code, Chapter 12. C) Disputes. All disputes regarding rates, charges and adjustments shall be resolved in accordance with the procedures set forth in Section 17 of this Agreement. D) Franchise and Administrative Fee. In consideration for the franchise granted under this Agreement, Contractor shall to submit to City, on the tenth (10th) day following the last day of each month during the term of this Agreement, an administrative fee equal to Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E four percent (4%), and a franchise fee equal to five percent (5%), of the total gross receipts actually collected or received by or on behalf of Contractor from all customers in connection with the services performed hereunder, except for those revenues received by Contractor in connection with the sale of Recyclable Materials (collectively, the "City Fee"). The City Fee shall be considered due on the last day of each month and payable on the tenth (10th) day thereafter. For example, if September bills are mailed on October 1, the City shall be paid on or before November 10 the appropriate percentage of all amounts collected during the month of October. Contractor shall send the last page of the monthly cash receipts journal, the billing register and the accounts receivable aging report to the City each month to verify collections for each month. Upon reasonable notice, City shall be given access to Contractor's billing and collection records. The City may increase the franchise fee to a maximum of seven percent (7%) upon ninety (90) days' written notice to Contractor; provided, that in the event the City increases the City Fee it shall, prior to the effective date of the increase, enact an increase in collection rates that shall permit Contractor to recover the full amount of the increase, including an allowance for the operating ratio. E) Late Payment Charge. Contractor agrees to pay a late payment service charge of five percent (5%) of the unpaid amount of any City Fees that become due hereunder and remain unpaid for more than ten (10) days. Such amount of unpaid City Fees, if left unpaid, shall accrue interest at a rate of 10% simple interest per annum until paid, calculated based on a 365 day year. 12) Performance Audits and Liquidated Damages. A) Performance Audit. City may conduct performance audits of Contractor's operations and services under this Agreement in its discretion. The audit will be conducted by a qualified firm selected by City, and Contractor shall reimburse City for its costs of this audit in an amount not to exceed $25,000 for the first performance review, increased by $5,000 per review for each subsequent review. The audit will address and review appropriate areas of performance including, but not limited to (1) organizational structure and management systems and procedures, (2) efficiency of collection and disposal operations, (3) staffing practices, including the deployment of management and supervisory personnel, (4) financial management practices, including billing and collection systems, (5) personnel practices and the resolution of employee grievances, (6) the handling of customer complaints, requests and inquiries, (7) the acquisition, maintenance and replacement of equipment, (8) the utilization and management of facilities, and (9) achievement of established service goals, as described in Section 4(L) of this Agreement. In the event that this audit reveals areas of performance which the City believes should be changed or improved, the City may request, and Contractor shall attend, a meeting at which the parties shall confer with respect to these matters. Contractor shall be required to adopt any changes requested by the City to rectify a Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E failure to perform according to the terms of this Agreement or a hazard to public health or safety. Contractor shall be required to consider in good faith adoption of any changes that will not materially increase Contractor's costs of performance under this Agreement. B) Liquidated Damages. In addition to any other rights or remedies of City afforded by any provision of this Agreement or by law, City shall have the following rights with respect to Contractor's failure to perform Contractor's required services under this Agreement. City shall give written notice to Contractor of any such failure to perform required services, and in such notice, City shall provide to Contractor a fixed period of time of not less than thirty (30) days to comply with its required services under this Agreement or to correct any failure to perform such services. If Contractor fails to perform such required services or correct any such failure, City shall, in addition to any other remedies available to it, have the right to assess and collect from Contractor the liquidated damages applicable to the type of service or failure, as set forth in Exhibit "I" attached hereto and incorporated herein by this reference. City's rights to assess liquidated damages pursuant to this section of the Agreement shall be in addition to any other rights or remedies of City, including the rights of City provided in Section 12.14 of the Code. The parties agree that the liquidated damages are a reasonable estimate of unmeasurable damages that would result from Contractor's failure to perform certain required services described in Exhibit "I". 13) Relationship of Parties. A) Independent Contractor. It is expressly understood and agreed by the parties that at all times in connection with this Agreement Contractor shall be an independent contractor. All persons employed by Contractor in connection with this Agreement shall be employees of Contractor and not employees of City in any respect. Subject to the requirements set forth herein, the means whereby Contractor's obligations under this Agreement are performed by Contractor shall at all times be under the control and supervision of Contractor. Neither Contractor nor its employees or agents shall at any time represent themselves to be employees or agents of City in any manner or for any purpose. B) Indemnification. i) To the maximum extent permitted by law, Contractor hereby agrees to defend and indemnify City, its City Council, commissions, officers, agents, volunteers and employees against any claim, injury, liability, loss, costs, fines, penalties and/or expense or damage, however same may be caused, including all costs and reasonable attorneys' fees in providing a defense to any claim or legal action, arising directly or indirectly from any of Contractor's acts, errors or omissions with respect to or in any way connected with Contractor's operations, services, fees or charges Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E relating to this Agreement, including without limitation, any failure of Contractor to comply in all respects with the provisions of this Agreement and all federal, state and local laws and regulations applicable to Contractor's performance hereunder and any claim that City's award of an exclusive franchise herein is illegal. The acceptance by City of any work or services performed by Contractor under this Agreement shall not operate as a waiver of any such right to indemnification. ii) Upon the demand of City, Contractor shall provide a defense to City and its representatives who are named as defendants in any legal action or proceeding for which indemnification is required. City shall have the right to approve counsel selected by Contractor for the defense of any such matter. Contractor shall not settle any claim or lawsuit without the prior approval of City, which approval shall not be unreasonably withheld. iii) Contractor's obligations under this subsection to indemnify City shall not extend to any claim, injury, liability, loss, costs, fines, penalties and/or expense or damage arising solely from the negligence or willful misconduct of City or its officers, agents, volunteers or employees. C) Hazardous Substances Indemnification. Contractor shall indemnify, defend with counsel reasonably acceptable to City, protect and hold harmless City, its elected and appointed boards, commissions, officers, employees, and agents (collectively, "Indemnitees") from and against all claims, damages (including, but not limited to, special, consequential, natural resources and punitive damages), injuries, costs (including without limit any and all response, remediation and removal costs), losses, demands, debts, liens, liabilities, causes of action, suits, legal or administrative proceedings, interest, fines, charges, penalties, attorneys' fees for the adverse party, and expenses (including without limit attorney's and expert witness fees and costs incurred in connection with defending against any of the foregoing or in enforcing this Indemnity), of any kind whatsoever paid, incurred or suffered by, or asserted against, Indemnitees arising from or attributable to the acts or omissions of Contractor, its officers' directors, employees, companies or agents, whether or not negligent or otherwise culpable, in connection with or related to the disposal of Hazardous Materials collected in the City by Contractor after the effective date of this Agreement. D) Provisions of this Agreement and of the Prior Agreement for indemnification and defense shall survive the termination of the same. 14) Guaranty. Contractor shall provide the written guaranty of Contractor's performance of all of its obligations under this Agreement by its affiliate, Recology Inc., a California corporation. Said guaranty shall be in the form of Exhibit "NJ" attached hereto and incorporated herein by this reference. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E 15) Insurance. A) Insurance Coverages and Amounts. Contractor agrees to maintain in full force and effect, at Contractor's own cost and expense, at all times during the term of this Agreement, insurance coverages of the types and in the amounts set forth in Exhibit "K" attached hereto and incorporated herein by this reference. B) Certificates of Insurance. Contractor shall provide to City certificates of insurance evidencing the insurance required to be maintained by Contractor in accordance with this section. Such certificates shall comply with all requirements therefore set forth in Exhibit "K". 16) Assignment. Contractor shall not in any manner assign its rights or delegate its duties or obligations under this Agreement, either fully or in part, by operation of law or otherwise, without the prior written consent of City, which consent shall not be unreasonably withheld. Any sale of assets or securities, or any merger or reorganization of Contractor as a result of which there is a change in the majority ownership of or the right to control Contractor shall be deemed an assignment by Contractor requiring the prior written consent of City. 17) Dispute Resolution. A) Call for Mediation. If the parties are unable to resolve a dispute arising under this Agreement in a cooperative manner, either party may call for mediation, as hereafter described. The party calling for mediation shall serve notice in writing upon the other party setting forth the question or questions to be mediated. The costs of the mediation shall be borne equally by the parties. B) Mediation. Within ten (10) days after delivery of the notice called for under subsection (a), the parties shall select a mutually acceptable mediator from the Judicial Arbitration and Mediation Service ("JAMS") or other mutually agreeable organization. In the event the parties are unable to agree on a mediator, a mediator shall be selected for them at random by the San Francisco office of JAMS or other mutually agreeable organization. Within ten (10) days thereafter, the parties shall meet with the mediator in a good faith attempt to resolve their dispute. The parties shall continue to meet with the mediator until their dispute is resolved or the mediator indicates that he or she does not believe that further efforts are likely to result in a successful resolution. 18) Term and Termination of Agreement. A) Commencement and Term. This Agreement shall commence on the Effective Date. The term of this Agreement shall be from the Effective Date through December 31, 2022, or until replaced with a new franchise agreement, whichever occurs soonest. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E B) Termination Upon Default. In addition to any other rights of City to terminate this Agreement, including such rights set forth in other provisions of this Agreement, City shall have the right set forth in this subsection to terminate this Agreement upon the occurrence of certain events herein described. Upon any material default of Contractor in the performance of its obligations under this Agreement, City may give to Contractor a written notice setting forth the nature of the default and demand that said default be cured within a reasonable time, which as used herein shall mean such period of time as will be reasonably required under all facts and circumstances of the particular matter to cure said default; however, in no event shall such time exceed a period of sixty (60) days, or be less than a period of thirty (30) days, after the giving of such notice. If Contractor fails, neglects or refuses within the time stated to cure said default or to comply with the relevant terms of this Agreement, then City, without further notice or other proceedings, shall have the right to terminate this Agreement and all of Contractor's rights hereunder. C) Strike or Labor Dispute. The parties hereby agree that if Contractor's failure to perform hereunder is due to a strike or labor dispute, this Agreement shall not terminate and shall continue to be effective for the duration of such strike or labor dispute. Such failure to perform shall not be considered a material default for purposes of subsection (B), but it may qualify as a failure to perform pursuant to Section 5(C). In the event of such a strike or labor dispute, Contractor shall maintain an unobstructed entrance at its place of business which is not regularly used but which will be primarily reserved for use by City access while City or its designated representative is collecting Refuse. If the labor dispute or picketing blocks access to Contractor's place of business, Contractor shall receive no compensation for any time period in which it failed to collect and remove Refuse in accordance with the provisions of this Agreement. D) Termination Upon Insolvency Events. If Contractor shall at any time during the term of this Agreement become insolvent, or if bankruptcy proceedings shall be instituted by or against Contractor, or if Contractor shall be adjudged bankrupt or insolvent by any court, or if a receiver shall be appointed for any substantial part of Contractor's assets, or if Contractor shall make an assignment of any substantial portion of its assets for the benefit of its creditors, then in any such event, at the option of City, this Agreement shall immediately terminate upon notice by City to Contractor. Under no circumstances shall this Agreement or franchise hereunder become a part of the assets of the estate of Contractor as a bankrupt, insolvent or assigning entity, as set forth in this section. E) Effect of Termination. In the event of the termination of this Agreement on account of Contractor's default, failure to perform its obligations hereunder or insolvency, City shall have the right to take possession of Contractor's equipment, vehicles, tools, computers, software, business records, including billing and collection records, and other personal property reasonably necessary to continue the services performed by Contractor under Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E this Agreement; provided, however, that City shall not be entitled to possession of proprietary information such as route maps, nor shall Contractor be required to provide customer lists unless and until City has entered into a refuse collection agreement with another collector. City shall have the right to retain possession of said equipment until other suitable replacements can be purchased or otherwise acquired by City for said purpose, and City shall pay Contractor the reasonable rental value of such equipment and personal property during the time it is used by City for said purpose. During such time, City shall retain all fees, charges and revenues applicable to the collection, disposal and recycling services performed by City. 19) Notices. Any notice required or permitted to be given to a party pursuant to the provisions of this Agreement shall be in writing and shall be effective upon personal delivery, to Contractor's designated representative or to the City Administrator, or three (3) days after deposit in the U.S. Mail, first class, postage prepaid and properly addressed to the party to be notified at the address set forth at the end of this Agreement or at such address as such party may designate by advance written notice to the other party in accordance with this section. 20) Miscellaneous Provisions. A) Entire Agreement. This Agreement constitutes the entire Agreement between the parties pertaining to its subject matter and supersedes all prior or contemporaneous written or oral agreements and understandings of the parties, either express or implied, including, without limitation, the Prior Agreement. B) Modifications and Waivers. Any modification or amendment of this Agreement shall be effective only if evidenced by a written instrument executed by duly authorized representatives of the parties hereto. Any party may waive specific rights hereunder, which shall be effective only if evidenced by a written instrument executed by a duly authorized representative of such party. In no event shall such waiver of any rights hereunder constitute the waiver of such rights in any future or other instance unless the waiver so specifies in writing. C) Severability. In the event any provisions of this Agreement should, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, which shall remain valid and enforceable to effectuate the original intent of the parties to the fullest extent practicable. D) Interpretation. The captions in this Agreement are for convenience and reference only, and the words contained therein shall in no way be held to explain, modify, amplify or aid in the interpretation, construction or meaning of this Agreement. Any pronouns or references used herein shall be deemed to include the masculine, feminine or neuter genders, as appropriate. Any expression in the singular or the plural shall, if appropriate Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E in the context, include both the singular and the plural. The parties agree that this Agreement shall be fairly interpreted in accordance with its terms without any strict construction in favor of or against either party, and that ambiguity shall not be interpreted against the drafting party. E) Further Documents. Each party agrees to execute and deliver any and all documents which may be required or expedient to carry out the provisions and intent of this Agreement. F) Authority. Each person executing this Agreement on behalf of a party hereto represents and warrants that he or she has been duly authorized to execute and deliver this Agreement on behalf of the party and that this Agreement is binding upon the party in accordance with its terms. G) Multiple Originals and Counterparts. Each executed copy of this Agreement, if more than one, shall be deemed an original for all purposes, and this Agreement may be executed in counterparts or by annexing signature pages hereto showing assent to the terms of this Agreement. H) Validity. In any action or proceeding between the parties arising from or relating to this Agreement, neither party shall challenge the validity of this Agreement or the manner of its adoption. I) Exhibits. The following exhibits are attached to this Agreement, each of which is incorporated herein by reference. Exhibit A: Collection Schedules and Rules Exhibit B: Container Specifications and Rules Exhibit C: Extra Pickup and Other Special Services Exhibit D: Customer Service Standards Exhibit E: Collection Vehicle Specifications Exhibit F: Monthly Reports Exhibit G: Approved Collection and Special Services Rates Exhibit H: Form of Monthly Billing and Collection Report Exhibit I: Liquidated Damages for Failure to Perform Exhibit J: Guaranty of Performance Exhibit K: Required Insurance Coverages Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E IN WITINESS WHEREOF, the parties hereto sign this Agreement as of the Effective Date set forth at the beginning hereof. CITY: CONTRACTOR: CITY OF GILROY RECOLOGY SOUTH VALLEY _____________________________________ ____________________________________ Marie Blankley, Mayor Salvatore M. Coniglio, Chief Executive Officer APPROVED AS TO FORM: ATTEST: _____________________________________ _____________________________________ Andrew Faber Esq., City Attorney Thai Nam Pham, City Clerk Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "A" COLLECTION SCHEDULES AND RULES 1) Service Area & Collection Routes and Schedules. Contractor shall perform the required collection services in the areas and along the routes mutually agreed upon by the parties. Contractor shall collect all materials in accordance with schedules agreed upon and changed from time to time with the approval of City. When the regular collection day falls on a holiday, collection shall be made on the next collection day. Alleyway collection service shall continue to be available during the term of this Agreement to all residences for which such service was available on the effective date of this Agreement at no extra charge. 2) Collectable Material. Contractor shall have the sole and exclusive authority and obligation to collect and remove those of the following materials which are segregated and placed in (or next to, if authorized) appropriate containers at Curbside on public streets (or other approved location) for collection from customers as specified by the corresponding schedules, and regardless of weather conditions. A) Refuse shall be collected from all customers on a weekly basis. B) Organic Waste shall be collected from all customers on a weekly basis. C) Recyclable Materials shall be collected from all Residential Customers and all Multi- Family Can Customers on a weekly basis. Contractor shall provide commercial recycling to all voluntarily subscribing Commercial Customers, for whom collection of Recyclable Materials shall be provided on a weekly or as-needed basis. Recyclable Materials shall be collected from voluntarily subscribing Multi-Family Bin Customers on a weekly or as- needed basis. 3) Non-Collectable Material. Contractor shall not be required to collect Hazardous Materials or other materials which are not Refuse, Yard Waste or Recyclable Materials, nor shall Contractor be required to collect materials which are not placed as required by applicable collection rules for such items. If Contractor refuses to collect such misplaced materials, Contractor shall leave a notice explaining why such materials were not collected. The form and content of such notice shall be subject to approval by City. 4) Missed Pick-ups. In case of a missed pick-up called in by a customer or City, Contractor shall collect the materials from the customer during the next regular collection day. All calls relating to missed pick-ups shall be logged in by Contractor. The log shall be sent to City on a monthly basis, but shall be available for inspection at any time by City. 5) Litter Abatement. Contractor shall use due care to prevent Solid Waste or fluids from leaking, being spilled and/or scattered during the Collection or transportation process. If any Solid Waste or fluids leak or are spilled during Collection, Contractor shall promptly Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E clean up all such materials. Each Collection vehicle shall carry a broom and shovel at all times for this purpose. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "B" CONTAINER SPECIFICATIONS AND RULES 1) Container Specifications A) Recycling Containers. The Recycling Containers to be provided and used in the residential curbside recycling program shall be one (1) fourteen (14) and one eighteen (18) gallon bin for each customer, having a design and specifications acceptable to City and having at least one (1) hole near the bottom of each container. B) Refuse Containers. The material, shape, color, labels and all other design specifications of the Refuse Containers, except for size (which is specified in the Agreement), shall be as agreed upon by the parties and may be subsequently changed from time to time with the prior written approval of City. The containers shall have a weight limit of seventy (70) pounds per thirty-two (32) gallons of capacity. C) Yard Waste Containers. The material, shape, color, labels and all other design specifications of the Yard Waste Containers, except for size (which is specified in the Agreement), shall be as agreed upon by the parties and may be subsequently changed from time to time with the prior approval of City. 2) Container Rules A) All containers for the integrated waste management program services described in the Agreement shall be purchased, provided and delivered to customers by Contractor. B) Contractor shall provide, at Contractor's sole cost and expense, such additional recycling containers to those eligible customers in City that demonstrate the need for such additional containers because of the amount of Recyclable Materials collected from such customers. C) Contractor shall replace all containers at its own expense, whether such replacement is due to loss, theft, damage, destruction, normal use, normal exposure or manufacturing defects. Contractor shall provide to City documentation of the cost of such containers. D) Newspaper and cardboard will be placed in paper bags or flattened and set next to the Recycling Containers, or bundled in a fashion which allows for easy collection. Motor oil shall be placed in the Contractor provided one (1) gallon HDPE plastic container or in any watertight, screw capped one (1) gallon container provided by the residential customer, and Contractor shall provide the zip-lock plastic bag for the recycling of used motor oil filters to any residential customer, upon request. Contractor shall provide these used motor oil containers and oil filter containers at no cost to the customers. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT “C” EXTRA PICK-UP AND OTHER SPECIAL SERVICES 1) Extra Pick-up A) Amnesty Tags. Contractor shall provide and be responsible for the distribution of quarterly "Amnesty Tags" to each eligible customer. The Amnesty Tags shall allow the customer to discard up to thirty-two (32) gallons of refuse, not exceeding thirty-five (35) pounds in weight, one time per quarter at no additional charge. Contractor shall initially supply these "Amnesty Tags" in the public outreach packet included in the delivery of the Refuse, Yard Waste and Mixed Paper containers. All future distributions of the "Amnesty Tags" will be the responsibility of Contractor. B) Extra Pick-Up Tags. Contractor shall offer "Extra Pick-Up Tags" for a cost identified in Exhibit “G” for purchase by individual can customers for extra refuse above their subscription service. Contractor shall make available these Extra Can Tags at Contractor's office, City Hall, and participating local merchant locations. Extra Pick-Up Tags may be attached to refuse placed in a single plastic bag, the weight of which shall not exceed fifty (50) pounds. C) Other Overages. i) Yard Waste Overages. Overages of Yard Waste are allowed if they are bundled in 1' x 2' x 4' dimensions and overages do not exceed ten (10) bundles or cans per household per two (2) week period. ii) Mixed Paper. Overages of Mixed Paper shall be collected if they are placed in a paper bag no larger than 1' x 2' x 2'. Customers shall be limited to no more than five (5) such bags per week. iii) Christmas Trees. Contractor agrees to continue to collect Christmas trees from customers beginning the first service day after Christmas and continuing until the fifteenth (15th) day of January. 2) Bulky Goods. Contractor shall offer a Bulky Goods pick-up service on an on-call basis for the collection of items such as White Goods, electronic waste, furniture, mattresses and carpets. The charge for the collection of these items shall be identified in Exhibit “G”. 3) Oil Filter Recycling. Oil Filter Recycling shall be provided by Contractor at no charge to all residential customers receiving can service. The service will be provided weekly and Contractor agrees to provide plastic zip-lock bags to such customers who may wish to recycle their oil filters at no charge. Contractor agrees to pick up oil filters as long as they are securely sealed in the Contractor-provided bag. Contractor shall be responsible for the advertising of this program to all eligible customers. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E 4) Voluntary Recycling. Contractor shall provide weekly recycling service to Multi-Family Bin Customers and Commercial Customers who voluntarily subscribe to such service. Those subscribing Multi-Family Bin Customers shall be charged a fee identified in Exhibit “G” for recycling services. The material collected will include all those materials listed under Section 1(I) of the Agreement. Multi-Family complexes will also have the option to utilize Contractor's Commercial Recycling rate of seventy percent (70%) of the Refuse rate as shown in Exhibit “G”. Commercial Can Customers shall be eligible for two (2) eighteen (18) gallon bins upon request at no additional charge for Recyclable Materials. 5) Community Cleanup Projects. Contractor shall provide service to City for the City sponsored community cleanup projects at no charge and upon City's request. Contractor agrees to provide for the drop off, collection and disposal of debris boxes from said cleanup projects up to six (6) times per year, with a maximum of two (2) 20- yard containers to be provided for each event. 6) Complaints of Illegal Dumping. Contractor agrees to service complaints of illegal dumping of Bulky Goods on public properties at no charge and upon City's request. Complaints regarding items such as washers, furniture, mattresses, etc., that have been illegally disposed of on public property will be referred to Contractor by City for pick-up within forty- eight (48) hours of notification. Contractor shall provide documentation to City within seven (7) business days that the items under complaint have been picked up. 7) Drop-Off Recycling. Contractor shall make available, at Contractor's expense, drop-off recycling location during the term of the Agreement, except as otherwise may be directed by written notice from City to Contractor. Contractor shall make arrangements for drop-off recycling for residents and businesses of City or other places as and in accordance with rules approved by City. Contractor's recovery program shall consist of the placement of bins at said location for deposit of Recyclable Materials. No charges shall be made for drop-off recycling by residents of City, unless specifically authorized by City and set forth in Exhibit "G" hereto, provided that the items dropped off are generated within the City and do not exceed two (2) 18-gallon containers per resident per week. Contractor shall include regular advertisements of this drop-off recycling location and services in its promotional program described in Section 4(h) of the Agreement. 8) Street Sweeping. A) Scope of Services. i) Contractor shall perform street sweeping operations using appropriate vehicles on all designated City streets, as identified by the City and approved by the Contractor, no less frequently than once every two weeks, weather permitting, except as provided below. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E ii) Contractor shall perform street sweeping operations using appropriate vehicles in City business districts and on arterial streets, as identified by the City and approved by the Contractor, no less frequently than once per week, weather permitting. iii) Contractor shall perform street sweeping operations using appropriate vehicles on certain City parking lots, as identified by the City and approved by the Contractor, no less frequently than once every two weeks, weather permitting. B) Performance Requirements. i) Contractor will provide sufficient equipment to guarantee uninterrupted service to City, at Contractor' s sole cost and expense. Contractor shall maintain the equipment in good repair and operating condition and shall provide all fuel, lubricants, tires, and all materials and supplies for the operation thereof. Contractor, at its sole cost and expense, shall furnish competent personnel to operate all equipment and such other employees as required to furnish adequately the service required in this Section. ii) Contractor shall be solely responsible for disposal of all sweepings collected by Contractor in the performance of services pursuant to this Section. iii) Contractor shall not be required to perform street sweeping in any new subdivision or development in the City until the public improvements of the subdivision or development have been accepted by the City iv) Contractor shall be provided with access and the materials necessary to obtain water from City water hydrants and shall be allowed to use such water as necessary to perform duties under this Section free of charge. C) Service Exclusions. Contractor and City agree that the street sweeping performed by Contractor pursuant to this Interim Agreement shall be the collection and disposal of routine debris from streets. The following types of street sweeping are excluded from this Interim Agreement: i) Street Sweeping to clear debris from public emergencies and traffic accidents during non-operational hours; and ii) The clearing of hazardous waste. 9) Phase 1 of the Commercial Generator Desktop Compliance Reviews for SB 1383, AB 1826, and AB 341 Compliance A) Contractor shall complete a compliance review of all Multi-Family and Commercial Customers that subscribe for two (2) cubic yards or more per week of Solid Waste, including Organic Materials, to determine whether they are subscribed for Organic Materials collection service and Recyclable Material collection service, as applicable. The Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E Commercial Generator Desktop Compliance Reviews consist of a “desk” review of records to determine Customers’ compliance and does not require on-site observation of service. B) As part of the compliance review described in subsection (A) above, Contractor shall identify covered generators requiring Organic Materials collection service under AB 1826 and SB 1383, as well as those covered generators not enrolled for service. For the purposes of this subsection (B), a covered generator is a Multi-Family or Commercial Customer that is subscribed for two (2) cubic yards or more of Solid Waste per week. C) As part of the compliance review described in subsection (A) above, Contractor shall identify covered generators requiring Recyclable Material collection service under AB 341, as well as those covered generators not enrolled for service. For the purposes of this subsection (C), a covered generator is a Multi-Family or Commercial Customer that is subscribed for four (4) cubic yards or more of Solid Waste per week. D) The desktop compliance review shall be completed in the month of August and reported to the City by the first week of September of 2022. 10) AB 1826 and SB 1383 Outreach and Education A) Contractor shall complete outreach using a variety of platforms and tools each month, which shall focus on the requirements of AB 1826 and SB 1383 including ads in local publications, social media, mailings, etc. Outreach conducted shall be reported to the City at the end of each month for the duration of this Agreement. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "D" CUSTOMER SERVICE STANDARDS 1) General Service Standards. In addition to the customer service standards set forth elsewhere in the Agreement, including its Exhibits, Contractor shall also maintain the following standards: A) Professionalism. Contractor shall perform all services under the Agreement in a thorough, professional, sanitary, safe and careful manner. Contractor shall establish and enforce an educational program which will train Contractor's employees in the identification of Hazardous Waste. Contractor shall also train its employees in customer courtesy, shall prohibit the use of loud or profane language, and shall instruct Collection crews to perform the work quietly. Contractor shall use reasonable efforts to assure that all employees present a neat appearance and conduct themselves in a courteous manner. Contractor shall provide suitable operation, health and safety training for all of its employees who use or operate equipment or who are otherwise directly involved in Collection or other related operations. B) Compliance with Laws. Contractor shall perform all services under the Agreement in accordance with all federal, state and local laws, ordinances and regulations, including without limitation the provisions of applicable sections contained in Chapter 12 of the Gilroy City Code. C) Disturbance. No collection made hereunder in residential neighborhoods shall commence prior to 6:00 a.m. or occur after 7:00 p.m. on any day. All collection shall be accomplished without unnecessary noise, litter, disturbance, or commotion. D) Handling of Containers. Contractor agrees that all containers, after emptying, shall be returned with the lids closed, and placed, not thrown, to the premises from which they were removed, within five (5) feet of the place the container was picked up, but not in any driveway or street. 2) Service Inquiries & Complaints A) Telephones. Contractor shall provide and maintain, at Contractor's expense, such telephones and telephone answering services as may be reasonably necessary so that calls, requests, complaints and service inquiries may be received by Contractor with respect to Contractor's operations and services between the hours of 8:00 a.m. and 5:00 p.m. on all regular collection days. Contractor shall have staff available and assigned to answer such calls during these hours. Answering services shall be maintained outside of regular business hours and collection days. Contractor shall also install, utilize and maintain during the term of this Agreement appropriate telecommunication equipment for communication with deaf customers, such as "Telecommunication Device for the Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E Deaf" (TDD), and provide training, as reasonably necessary, for the use of that equipment. B) Response. Contractor shall respond within the same business day to all calls and act within one business day, where practicable, upon all reasonable requests and complaints pertaining to Contractor's operations and services, including complaints or service inquiries referred to Contractor by City. Contractor shall maintain a daily log of all complaints, including date, time, name and address of complainant and a description of actions taken to address and resolve such complaints and prevent reoccurrence. A copy of the log shall be provided to City upon request and at least monthly during the term of this Agreement. Contractor shall furnish to City by the tenth (10th) day of each month during the term of this Agreement a monthly service report for the preceding month describing Contractor's response to and resolution of all requests, complaints and service inquiries. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "E" COLLECTION VEHICLE SPECIFICATIONS 1) Collection vehicles used by Contractor to perform the services contemplated by this Agreement shall be painted uniformly and numbered in consecutive sequence and shall have Contractor's name, telephone number, place of business and the number of the vehicle painted in letters of a contrasting color on each side of each vehicle, and the number painted on the rear. Said rear number shall be readable for a distance of one hundred (100) feet. No commercial or other advertising shall be permitted without the approval of City. 2) All collection equipment used by Contractor shall have appropriate safety markings including, without limitation, highway lighting, flashing and warning lights, clearance lights, and warning flags. All such safety marking and all other vehicle aspects shall conform to the requirements of the California Vehicle Code, as amended from time to time, and shall be subject to approval by City. 3) Collection vehicles shall be repainted at least every sixty (60) months, with "touch up's" in the interim as required. Each vehicle, when repainted, shall be made available to City for inspection. All collection vehicles shall not be more than ten (10) years old unless rehabilitated, overhauled, and repainted to an equivalent condition of a new vehicle. Rehabilitated vehicles shall be made available to City for inspection. In no case shall any vehicle be more than fifteen (15) years old. 4) Contractor's compliance with the collection vehicle specifications hereunder shall be subject to the review and determination of City. All vehicles operated by Contractor must comply with applicable state laws and regulations. Contractor shall cooperate with all California Highway Patrol vehicle inspections initiated with respect to Contractor's vehicles. 5) All collection vehicles shall be fueled by compressed natural gas. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "F" MONTHLY AND QUARTERLY REPORTS Contractor shall report to City the following information on a monthly basis: 1) Refuse Collected. Contractor shall provide City with information regarding the quantities of Refuse, Recyclable Materials, and Yard Waste collected, the type of material collected, from which City the Refuse or other material was collected, and from which category of customers the Refuse was collected. 2) Refuse Collection Vehicle Weigh-In. Contractor shall provide to City detailed information resulting from the weigh-in of collection vehicles under Section 4(a)(v) of the Agreement. Information to be reported shall be the number of vehicles weighed and the gross and net weight of each vehicle. 3) Container Expenditures. Contractor shall provide to City the quantity and types of containers provided to each category of customers, including additional and replacement containers for refuse customers and any other information City may reasonably require regarding the provision of and expenditures for containers. 4) Promotional Materials Distributed. Contractor shall provide to City the types and amount of promotional materials distributed by Contractor pursuant to Section 4(h) of the Agreement, and any other information City may reasonably required regarding the distribution of promotional materials and contacts made by Contractor to promote the integrated waste management program. 5) Customer Service Reports. Contractor shall provide to City information describing Contractor's response to and resolution of all requests, complaints and service inquiries, pursuant to Section 2(B) of Exhibit "D" to the Agreement. 6) Other. Contractor must also report to City such other information as may be required by the terms of the Agreement or as may be mutually agreed by the parties. Contractor shall retain all records required to be maintained by this Agreement for a period of not less than five (5) years. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "G" APPROVED COLLECTION RATES & APPROVED SPECIAL SERVICES RATES Rates Effective July 1, 2021 – Current and Approved Rates Under this Agreement Description Current and Approved Rate 1. Residential Customers and Multi-Family Can Customers (Including Recycling) 1-Can (32 gallon) 35.73 2-Cans (64 gallon) 51.11 3-Cans (96 gallon) 66.89 4-Cans (128 gallon) 85.43 Each Additional Can (32 gallon) 18.90 Extra Can/Bag Tag 7.43 Bulky Item Pickup (Plus Disposal Cost) 22.27 Toter Subscription Charges 18.53 Low-Income Senior 1-Can (32 gallon) 30.18 2-Cans (64 gallon) 42.72 3-Cans (96 gallon) 55.82 4-Cans (128 gallon) 68.92 Hillside 1-Can (32 gallon) 43.06 2-Cans (64 gallon) 61.19 3-Cans (96 gallon) 79.77 4-Cans (128 gallon) 98.34 2. Residential Customers on Private Roadways (No Street Sweeping) 1-Can (32 gallon) 33.84 2-Cans (64 gallon) 49.22 3-Cans (96 gallon) 65.00 4-Cans (128 gallon) 83.54 Each Additional Can (32 gallon) 17.01 Extra Can/Bag Tag 7.43 Bulky Item Pickup (Plus Disposal Cost) 22.27 Toter Subscription Charges 18.53 Low-Income Senior 1-Can (32 gallon) 28.29 2-Cans (64 gallon) 40.83 3-Cans (96 gallon) 53.93 4-Cans (128 gallon) 67.03 Hillside Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E Description Current and Approved Rate 1-Can (32 gallon) 41.17 2-Cans (64 gallon) 59.30 3-Cans (96 gallon) 77.88 4-Cans (128 gallon) 96.45 3. Multi-Family Bin Customer Recycling Per Unit Charge 2.78 For recycling service only (option to choose Commercial Service) 4. Commercial and Multi-Family Bin Customer (Refuse) 1-Can (32 gallon) 35.73 2-Cans (64 gallon) 53.88 3-Cans (96 gallon) 72.49 4-Cans (128 gallon) 91.04 Each Additional Can (32 gallon) 20.45 5. Commercial and Multi-Family Bin Customer (Organics) 1-Can (32 gallon) 28.29 2-Cans (64 gallon) 42.80 3-Cans (96 gallon) 57.69 4-Cans (128 gallon) 72.53 Each Additional Can (32 gallon) 16.06 6. Commercial Front Loader Service Rates 2 Yard F/L (1x/week) 237.32 2 Yard F/L (2x/week) 445.20 2 Yard F/L (3x/week) 653.05 2 Yard F/L (4x/week) 860.98 2 Yard F/L (5x/week) 1,068.82 2 Yard F/L (6x/week) 1,276.72 2 Yard F/L (on call) 154.26 3 Yard F/L (1x/week) 341.81 3 Yard F/L (2x/week) 643.87 3 Yard F/L (3x/week) 945.83 3 Yard F/L (4x/week) 1,247.85 3 Yard F/L (5x/week) 1,549.86 3 Yard F/L (6x/week) 1,851.85 3 Yard F/L (on call) 219.94 4 Yard F/L (1x/week) 458.37 4 Yard F/L (2x/week) 866.80 4 Yard F/L (3x/week) 1,275.19 4 Yard F/L (4x/week) 1,683.64 4 Yard F/L (5x/week) 2,092.11 4 Yard F/L (6x/week) 2,500.49 4 Yard F/L (on call) 305.46 6 Yard F/L (1x/week) 667.36 6 Yard F/L (2x/week) 1,268.75 Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E Description Current and Approved Rate 6 Yard F/L (3x/week) 1,870.18 6 Yard F/L (4x/week) 2,471.57 6 Yard F/L (5x/week) 3,072.95 6 Yard F/L (6x/week) 3,674.35 6 Yard F/L (on call) 418.79 Front Loader Special (per cubic yard) 25.49 Commercial Front Loader Service Organics Rates 1 Yard F/L (1x/week) 130.80 1 Yard F/L (2x/week) 245.55 1 Yard F/L (3x/week) 360.28 1 Yard F/L (4x/week) 475.05 1 Yard F/L (5x/week) 589.78 1 Yard F/L (6x/week) 704.55 1 Yard F/L (on call) 85.16 2 Yard F/L (1x/week) 189.56 2 Yard F/L (2x/week) 355.86 2 Yard F/L (3x/week) 522.15 2 Yard F/L (4x/week) 688.49 2 Yard F/L (5x/week) 854.76 2 Yard F/L (6x/week) 1,021.09 2 Yard F/L (on call) 123.41 3 Yard F/L (1x/week) 273.15 3 Yard F/L (2x/week) 514.80 3 Yard F/L (3x/week) 756.37 3 Yard F/L (4x/week) 997.99 3 Yard F/L (5x/week) 1,239.59 3 Yard F/L (6x/week) 1,481.19 3 Yard F/L (on call) 175.95 4 Yard F/L (1x/week) 366.41 4 Yard F/L (2x/week) 693.14 4 Yard F/L (3x/week) 1,019.86 4 Yard F/L (4x/week) 1,346.61 4 Yard F/L (5x/week) 1,673.39 4 Yard F/L (6x/week) 2,000.08 4 Yard F/L (on call) 244.37 6 Yard F/L (1x/week) 533.60 6 Yard F/L (2x/week) 1,014.71 6 Yard F/L (3x/week) 1,495.84 6 Yard F/L (4x/week) 1,976.96 6 Yard F/L (5x/week) 2,458.07 6 Yard F/L (6x/week) 2,939.18 6 Yard F/L (on call) 355.05 Front Loader Special (per cubic yard) 20.39 6. Compactor Service Front Loader (per cubic yard) 54.80 Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E Description Current and Approved Rate 3-Yard F/L Compactor (1x/week) 712.40 3-Yard F/L Compactor (2x/week) 1,424.80 3-Yard F/L Compactor (3x/week) 2,137.20 7. Debris Box Rates 20 Cubic Yard Debris Box 576.73 Per ton charge (over 3 tons) 111.37 40 Cubic Yard Debris Box 961.11 Per ton charge (over 6 tons) 111.37 20 Cubic Yard Debris Box (organics) 461.39 Per ton charge (over 3 tons) 89.09 40 Cubic Yard Debris Box (organics) 768.89 Per ton charge (over 6 tons) 89.09 Debris Box Compactors 54.43 (per cubic yard of capacity) 20 Cubic Yard Debris Box (recyclable) 357.23 40 Cubic Yard Debris Box (recyclable) 632.19 8. Additional Street Sweeping Monday through Friday, 8:00am to 5:00pm (per hour) 136.89 Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "H" FORM OF MONTHLY BILLING AND COLLECTION REPORT BILLING AND COLLECTION REPORT FOR THE MONTH OF______________ ,20______ Total Amounts Billed (See Attached Billing Register): Charges: Late: () Residential Customers $__________ $__________ () Multi-Family Bin Customers $__________ $__________ () Multi-Family Can Customers $__________ $__________ () Commercial Customers $__________ $__________ () Other Customers (specify: __________) $__________ $__________ GRAND TOTAL BILLED $__________ Total Amounts Collected from Previous Monthly Billings: (See Attached cash receipts journal) Charges: Late: () Residential Customers $__________ $__________ () Multi-Family Bin Customers $__________ $__________ () Multi-Family Can Customers $__________ $__________ () Commercial Customers $__________ $__________ () Other Customers (specify: __________) $__________ $__________ GRAND TOTAL BILLED $__________ Total Amount Collected from Recycling: (See attached recycling report) () Recycling Containers $__________ () Recycle Drop-Off Locations $__________ () Other Sources (specify: __________) $__________ SUBTOTAL $__________ GRAND TOTAL collected $__________ Fees to be Paid to City: Admin 4% Franchise 5% () City Fee Payments Made to City $__________ $__________ () Other (specify: ________________) $__________ $__________ Amount of Check to City $__________ Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "I" LIQUIDATED DAMAGES FOR FAILURE TO PERFORM Description Amount Collection before 6:00 a.m. $90 per verified occurrence Failure to submit monthly Reports: Tonnage Recycling Billing and Collection $90 per day for each report Failure to service missed collection within 24 hours $35 per customer per day Failure to maintain Contractor’s containers and inventory $15 per day late based on agreed compliance schedule Failure to renew Performance Bond or Insurance and submit Certificate of Insurance prior to expiration date $185 per day Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "J" GUARANTY OF PERFORMANCE For valuable consideration, Recology Inc., a California corporation ("Guarantor"), the parent company of Recology South Valley ("Contractor"), hereby unconditionally guarantees the full and faithful performance and satisfaction by Contractor of all of Contractor's obligations and liabilities under and arising from the agreement between City of Gilroy ("City") and Contractor dated August 15, 2022 ("Agreement"). Guarantor acknowledges that this Guarantee will directly benefit Guarantor and is given to induce City to enter into the Agreement with Contractor. If Contractor fails to perform any of the services or obligations required by the Agreement, or is in any way in default thereunder, or if Contractor fails to pay any amount which it becomes obligated to pay City relating to its performance or failure to perform the Agreement, Guarantor shall be fully obligated to perform such services and obligations, cure any such default and make such payments in the same manner and to the same extent required by the Agreement or any applicable decision or order in connection therewith. No notice or demand of any such failure or default by Contractor shall be required to be given to Guarantor. No right or power of City hereunder shall be deemed to have been waived by any act or conduct of City or by any neglect to exercise that right or power, or by any delay in so doing, and every right and power shall continue in full force and effect until specifically waived or released in writing executed by City. Guarantor authorizes City, without notice or demand to Guarantor, to modify, compromise or extend any obligation or liability of Contractor, or any part thereof, under or arising from the Agreement. Any indebtedness of Contractor now or hereafter held by Guarantor is hereby subordinated to any and all indebtedness of Contractor to City under or arising from the Agreement. Guarantor assumes all responsibility for keeping itself informed of Contractor's performance or non-performance of services and obligations under the Agreement, of Contractor's assets and financial condition, and of any other factors bearing on the nature, scope and extent of the risks undertaken by Guarantor under this Guarantee. Guarantor waives any right to require City to proceed against Contractor or pursue any other remedy in City's power whatsoever. In addition to the obligations and liabilities guaranteed hereunder, Guarantor agrees to pay attorneys' fees, costs and expenses incurred by City in enforcing this Guarantee. This Guarantee of Guarantor shall be binding on Guarantor and its successors and assigns, and this Guarantee shall enure to the benefit of City and its successors and assigns. The laws of the State of California shall govern all matters of construction, validity and performance of this Guarantee, which may not be waived, altered, modified or amended except in a writing duly signed by City and Guarantor. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E If any provision of this Guarantee is held to be invalid or unenforceable then, to the extent necessary to effectuate the original intent of the parties as closely as practicable, this Guarantee shall be construed as though it did not contain that provision, and the rights and liabilities of the parties to this Guarantee shall be construed and enforced accordingly. In any action or proceeding arising from or pertaining to this Guaranty, neither party shall challenge the validity of the Agreement or the manner of its adoption. The undersigned are duly elected officers of Guarantor and are authorized to execute this Guarantee on behalf of Guarantor in accordance with the attached resolution duly adopted by its Board of Directors. Dated: RECOLOGY INC. By: Its: Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E EXHIBIT "K" REQUIRED INSURANCE COVERAGES 1) Commercial General Liability Insurance. This policy shall insure Contractor and City against liability for personal injury or death to and of any person and for property damage arising or resulting from the operations of Contractor in connection with the performance of the Agreement. Such policy shall include business automobile liability coverage applicable to vehicles used by Contractor, and products-completed operations coverage, pertaining to such operations of Contractor. Minimum limits of coverage shall be in the amount of $5,000,000 each occurrence, combined single limit and general aggregate coverage (or, if there are separate limits for property damage liability, minimum policy limits of $500,000 per occurrence for such property damage liability). 2) Workers' Compensation and Employer's Liability Insurance. Contractor shall maintain full Workers' Compensation insurance in accordance with the laws of the State of California and other applicable laws and regulations. 3) The insurance companies providing the required insurance, and any deductibles and/or self- insured retentions which apply to such insurance, shall be subject to approval by City. 4) The Commercial General Liability Insurance shall cover City and its public officials, officers, employees and agents as additional insureds. The required insurance shall be considered primary insurance as respects any other valid and collectible insurance City may possess, including any self-insured retention City may have, and any other insurance City possesses shall be considered excess insurance only. Contractor shall agree to waive all rights of subrogation against City and its public officials, officers, employees and agents for any loss arising under the Agreement. 5) No cancellation or non-renewal of required insurance, and no reduction of coverage under such insurance, shall be effective until written notice has been given to City at least 30 days prior to the effective date of such cancellation or reduction. 6) Certificates evidencing the required insurance, or insurance policies, upon request, shall be filed with City upon the execution of the Agreement. Attachment A DocuSign Envelope ID: ACE5B3DF-69FF-4220-B69A-597561C4549E