HomeMy WebLinkAboutRES 16-186RESOLUTION NO. 16-186
BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF BEAUMONT:
THAT the City Manager be and he is hereby authorized to execute a Recyclable
Materials Processing Agreement between the City of Beaumont and WM Recycle
America, LLC to provide single stream recycling processing services. The Recyclable
Materials Processing Agreement is substantially in the form attached hereto as Exhibit
"A" and made a part hereof for all purposes.
PASSED BY THE CITY COUNCIL of the City of Beaumont this the 27th day of
September, 2016.
MayorW ME lj�i - C-
STATE OF TEXAS §
COUNTY OF JEFFERSON §
RECYCLABLE MATERIALS PROCESSING AGREEMENT
THIS RECYCLABLE MATERIALS PROCESSING AGREEMENT ("Agreement") is made
as of the day of September , 2016 ("Effective Date") by and between WM Recycle America,
LLC, Waste Management of Texas, Inc. and their corporate affiliates and subsidiaries ("Company"), and
the City of Beaumont, a political subdivision of the State of Texas ("Customer"). Customer and Company
are each a "Party" and collectively the "Parties."
1. DESCRIPTION OF WORK
A. For the consideration set forth below, Company agrees to provide single -stream recycling
processing services for the Customer's residential recycling routes (the Services). The Services shall
be performed in a good and workmanlike manner.
B. This Agreement shall be comprised of the following documents:
a. This Agreement and all of its exhibits or attachments ("Contract"); and
b. Company's proposal (the "Proposal").
In the case of a conflict between the language in the Contract and the Proposal, the terms and the conditions
of the Contract shall control and take precedence.
2. TERM
The term of the Agreement shall be one (l) year from the Effective Date (Initial Term). The Agreement
may be renewed for up to two additional one year tenors, upon mutual written agreement of the parties. Each
party agrees to provide the other party at least 150 -days' written notice before the expiration of the then -
current term of its intent to renew the Agreement. The Initial Term and Renewal Terms are collectively the
"Term."
A1]3131►111CIN&I
a. "Applicable Law" means any law, regulation, requirement, or order of any Federal, State or local
agency, court or other domestic or foreign governmental body, or interpretation thereof by any court
or administrative agency of competent jurisdiction, and requirements of all permits, licenses, and
governmental approvals applicable to the acquisition, design, construction, equipping, testing,
financing, ownership, possession, or operation of Designated Facilities and performance under this
Agreement.
b. "Blended Value" or "BV" is the total weighted value per Ton of each Recyclable and Non -
Recyclable component (including negatively -valued Recyclables and transfer and disposal costs of
Residue) for the Single Stream Materials delivered by or on behalf of Customer to the Designated
Facility.
EXHIBIT "A"
c. "Composition Audit" means the basis upon which Single Stream Materials delivered to the
Designated Facility are measured to determine the percentage of each Recyclable, Non -Recyclable,
and Residual component delivered by or on behalf of Customer as further described in Exhibit B.
d. "Processing Fee" means the compensation per Ton for costs incurred by Company to prepare
Recyclables for end markets, i.e., those actions necessary to render Recyclables acceptable to end
markets and/or designated buyers.
e. "CPI" means the Consumer Price Index -All Urban Consumers (CPI -U), US City Average, Garbage
& Trash Collection (CUUROOOOSEHG02), Not Seasonally Adjusted, as published by the United
States Department of Labor, Bureau of Labor Statistics.
f. "Customer" means the City of New Braunfels, Texas and any persons or entities authorized by the
City to collect and transport Recyclables collected from residential units within the City.
g. "Customer's Value-Share2z-means-the-Customer''-s percentage of the Blended Value minus the
Processing Fee as set forth on Exhibit C.
h. "Designated Facility" or "Designated Facilities" means Company's Material
Recovery Facility, located at 1995 Cedar, Beaumont, Texas 77701.
"Designated Holidays" are New Year's Day, Thanksgiving Day and Christmas Day.
j. "Excluded Materials" means radioactive, volatile, corrosive, flammable, explosive, biomedical,
infectious, biohazardous or toxic substance or material, or regulated medical or hazardous waste as
defined by, characterized or listed under applicable federal, state, or local laws or regulations, and/or
any other waste not approved in writing by Company.
k. "Force Majeure" shall include, but not be limited to, any act of terrorism, act of God, landslides,
lightning, fires, storms, floods, typhoons, hurricanes, severe weather, freezing, earthquakes, volcanic
eruptions, other natural disasters or the imminent threat of such natural disasters, pandemics,
quarantines, civil disturbances, acts of the public enemy, wars, blockades, or public riots, not
reasonably within the control of a Party.
1. "Load(s)" means all materials in a vehicle hauled to the Designated Facility for unloading and
processing.
m. "Net Value" means the amount paid to Customer by Company (or owed by Customer to Company)
calculated as set forth on Exhibit C.
n. "Nan-Recyclables" means any materials in the Single Stream Materials that are not Recyclables as
set forth in Exhibit A.
o. "Receiving Hours" means the regularly -scheduled hours of operation for the Designated Facility
p. "Recyclables" means acceptable materials contained within the Single Stream Materials as set forth
and further defined in Exhibit A.
q. "Residue" or "Residual" means (i) material that cannot be safely or effectively processed and/or
(ii)material that, after processing, cannot be effectively marketed for sale in its current state, and/or
(iii) Non-Recyclables, each of which will be disposed.
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r. "Single Stream Materials" means all of the materials delivered by or on behalf of Customer to
Company containing Recyclables and Non-Recyclables.
s. "Specifications" means the description of the Single Stream Materials as set forth in Exhibit A.
t. "Ton" means 2,000 pounds.
u. "Uncontrollable Circumstances" means acts of domestic (federal, state or local) or foreign
governments or governmental agencies or governmental restraint, changes in laws, rules,
regulations, fees, or taxes.
3. QUANTITY AND QUALITY
a. During the term of the Agreement, Customer shall provide one hundred percent (100%) of the Single
Stream Materials collected by -or on behalf of Customer, and Compan"hall receive the -Single -Stream -
Materials. Customer shall not divert, retract, or withdraw, or discontinue collection of any material listed as
a Recyclable in Exhibit A unless Customer and Company mutually agree to such action. Customer and
Company shall not allow scavenging of any Recyclables from the Single Stream Materials. Any additions
to the list of acceptable Recyclables in Exhibit A will require the mutual agreement of Customer and
Company.
b. Customer represents and warrants that it shall provide and deliver the Single Stream Materials in
accordance with the Specifications set forth in Exhibit A. Title to Recyclables provided by Customer or its
designated hauler(s) to Company is transferred to Company upon Company's receipt or collection unless
otherwise provided in this Agreement or Applicable Law. Title to and liability for Excluded Materials shall
remain with Customer or the generator of the material at all times.
c. Composition Audits shall be performed by Company in accordance with Exhibit B on Single Stream
Materials delivered to the Designated Facility by or on behalf of Customer in order to identify the overall
material composition and associated Blended Value.
d. This Agreement does not include and Company is not providing any confidential or secure shredding
or handling of confidential information that may be contained in, on, or within the Single Stream Materials.
Documents, data, or materials that contain confidential or private information, the destruction or
management of which is regulated by state or federal privacy or data security laws, regulations, or rules,
such as the Health Insurance Portability and Accountability Act of 1996, as amended, are not to be deposited
for recycling under this Agreement.
e. Company represents that its Designated Facility has the capacity to process the City's Single Stream
Materials. Company agrees that has the ability to provide reserve storage capacity on-site at the Designated
Facility for at least four (4) days of delivered Loads, in case of an equipment breakdown or other issue. The
Designated Facility has adequate and safe unloading and maneuvering room for City vehicles, both inside and
outside the facility, including a minimum of 30 feet of unrestricted floor to ceiling clearance.
4. PRICING/PAYMENTS/CHARGES
a. Payments and charges to Customer shall be calculated as set forth on Exhibit C. Where the Net Value of
the Single Stream Recyclables is positive, Company shall pay Customer on or about the last day of the month
following delivery for those Single Stream Recyclables meeting the Specifications delivered during the
preceding month. Where the Net Value is negative, the Customer shall pay Company on or about the
last day of the month following delivery for those Single Stream Recyclables meeting the Specifications
delivered during the preceding month.
5. DELIVERIES/HOURS
a. Customer shall deliver Single Stream Materials at Customer's expense to the Designated Facility during
Receiving Hours. All Single Stream Materials must be delivered in self -dumping trucks and will be weighed
in and out by Company at the Designated Facility. Company shall use reasonable efforts to provide a wait
time for Customer's delivery vehicles that averages fifteen (15) minutes or less, barring any unique or
infrequent circumstances beyond Company's control.
b. The Receiving Hours at the Designated Facility are Monday through Friday from 7:00 a.m. to 4:00 p.m.,
except for Designated Holidays.
c. Customer may request after-hours tipping of Single Stream Materials at the Designated Facility in order
to deliver material after 5:00 p.m. Customer -shall request such after-hours access in writing at least -3 -4 -hours
prior to the time Customer seeks such access. Company will make reasonable efforts to accommodate this
request for after-hours access.
6. DESIGNATED FACILITY STANDARDS
a. Company shall provide certified scales for weighing Single Stream delivered to the Designated Facility.
Scales shall be regularly calibrated as required by Applicable Law. Upon request from the Customer, Company
shall make available to Customer on a monthly basis weight tickets for each load of Single Stream delivered by
Customer. Customer's Single Stream Materials loads shall be weighed at the Designated Facility and Company
shall provide daily tickets reflecting the net weight of the Loads to the City's drivers.
b. If Excluded Materials are delivered to the Facility by or on behalf of Customer, Company, in its sole
discretion, may reject the entire load, or separately contain, set aside, segregate, isolate and manage such
Excluded Materials as required by Applicable Law. Customer will be notified promptly by phone or email of
the location, general character and amount of such Excluded Materials, and Customer will have no more than
4 hours from receiving notification to arrive at the Facility to view the Excluded Materials. If Customer indicates
it will send a representative to the Facility within 4 hours, Company agrees not to remove the Excluded
Materials from the Facility until after the representative arrives and views the Excluded Materials. If requested
by Company, Customer must remove within 24 hours of notification, or cause to be removed, such Excluded
Materials from the Designated Facility and shall transport and dispose of, or shall cause such Excluded
Materials to be transported and disposed, in accordance with Applicable Law. If Customer fails to timely
remove such Excluded Materials, Company may, after providing verbal or written notice to Customer, transport
and dispose of such Excluded Materials and charge the costs thereof to Customer.
c. Company shall recycle the Recyclables for reuse and, provided that there is a commercially reasonable
available market for such material, shall not dispose of any Recyclables, except such Residue left after
processing of the Single Stream Materials. Company makes no representations as to the marketability of the
Recyclables and may dispose of Recyclables when no reasonable commercial market exists. Company shall
provide Customer with written notice no more than 3 days after the decision is made to begin disposing of a
Recyclable due to market conditions along with information and/or documentation substantiating such
decision. Should no commercially reasonable available market for a Recyclable exist, such Recyclable shall
be classified as a Non -Recyclable until such time as a commercially reasonable available market exists.
Company reserves the right to add or delete materials from the list of Recyclables based upon changes in
market conditions, uncontrollable circumstances, governmental restraint, or changes in laws,
rules, regulations, or ordinances, or changes in the enforcement thereof, and Company will provide written
notice of any such change to the Customer.
d. Company shall provide its services hereunder and take reasonable care to operate its Designated
Facility in accordance with standard industry practices.
7. PUBLIC EDUCATION AND OUTREACH/REPORTS
a. Customer and Company agree to use reasonable efforts to inform and educate residents of the quality
requirements hereunder and to enforce the standards and Specifications for acceptance of Single Stream
Materials.
b. Company shall provide monthly and annual reports to the City, which provide the following
information: (i) total tons of Single Stream Materials received; (ii) total tons of Residue or Non-Recyclables
received and disposed; and (iii) the Net Value (the amount paid to Customer by Company or owed by
Customer to Company) calculated each month.
& INSURANCE
Company shall maintain, at its expense, insurance with limits not less than those prescribed below. With
respect to required insurance, Company shall:
i. Name the City of Beaumont as additional insured/or an insured, as its interests may appear, except
as to Company's workers' compensation coverage.
ii. Provide the City a waiver of subrogation.
iii. Provide the City with a thirty (30) calendar day advance written notice of cancellation or material
change to said insurance.
iv. Provide to the City Purchasing Manager a Certificate of Insurance evidencing required coverage
within ten (10) calendar days after receipt of Notice of Award.
Submit a certificate of insurance reflecting coverage as follows:
a. Automobile Liability:
Bodily Injury (Each person) - $250,000.00
Bodily Injury (Each accident) - $500,000.00
Property Damage - $100,000.00
b. General Liability (Including Contractual Liability):
Bodily Injury - $500,000.00
Property Damage - $100,000.00
c. Excess Liability:
Umbrella Form - $1,000,000.00
d. Worker's Compensation: - Statutory
e. Pollution Legal Liability/Environmental Impairment Insurance $1,000,000
9. INDEMNIFICATION/LIMIT OF LIABILITY
Company shall indemnify and hold harmless Customer, its employees, agents and officials from any and all
claims, losses or expenses resulting from any accidents, injuries or damages to persons or properties,
5
suits or demands including reasonable attorney fees which may be made against the Customer, its
employees, agents or officials to the extent caused by Company's negligent act or omission or
willful misconduct, or breach of this Agreement. Company's indemnification obligations will not
apply to occurrences involving Excluded Materials delivered by or on behalf of Customer. Neither
party shall be liable to the other for special, consequential, incidental or punitive damages arising
out of the performance of this Agreement.
10. TERMINATION
a. When a Parry has defaulted on one or more material terms of this Agreement, the non -
defaulting Parry may terminate this Agreement on thirty (30) days' written notice where such
default has not been cured within such thirty (30) day period. If a Party makes a general
assignment for the benefit of its creditors, files for bankruptcy relief, or has an involuntary
bankruptcy filed against it, the other Party may terminate this Agreement immediately upon
written notice. In the event either Party waives default by the other Party, such waiver shall not be
construed or determined to be a continuing waiver of the same or any subsequent breach or
default: n the event ofa-default, the -non -defaulting Party -shall have -the -right to seek all available
recourse to which it may be entitled by law or in equity, including, but not limited to, the right to
all damages or losses suffered as a result of such termination.
b. Either party may terminate this agreement without cause upon giving to the other party
sixty (60) days written notice of its intent to terminate.
11. NOTICES:
Any notice to be given hereunder shall be sent via certified mail or a nationally -recognized
overnight courier to the addresses below for each Parry:
If to Customer: Attn: Kyle Hayes
City Manager
PO Box 3 827
Beaumont, TX 77704
If to Company: Public Sector Director
Waste Management
520 E. Corporate,
Suite 100
Lewisville, TX
75057
with a copy to: Waste Management
9708 Giles
Austin, TX 78754
Attn: Senior Legal Counsel; and
CT Corporation
System 350
North St. Paul
Street Dallas,
Texas 75201
or such other addresses as the parties may hereafter specify by written notice
delivered in accordance herewith.
12. MISCELLANEOUS:
a. Except for the obligation to make payments hereunder for services already rendered, neither Party
shall be in default or liable to the other Party for its failure, in whole or in part, to perform or delay in
performance caused by Force Majeure, and the affected Party shall be excused from performance
during the occurrence of such events. If either Party delays or fails to return to performance under this
Agreement after the Force Majeure event, then such delay or failure may be considered a default
under this Agreement by the performing Party.
b. This Agreement shall be binding on and shall inure to the benefit of the parties hereto and their
respective successors and assigns.
c. This Agreement, including Exhibits A, B, and C, which are incorporated herein and made a
part hereof, represents the -entire -agreement between the -parties -and supersedes -any -and -all other
agreements related to the Recyclables, whether written or oral, that may exist between the Parties
or their affiliates.
d. This Agreement shall be construed in accordance with the law of the state in which this
Agreement is performed.
e. The parties shall endeavor to settle all disputes under, or relating to, this Agreement by
amicable negotiations. Except as otherwise provided herein, any claim, dispute, disagreement or
controversy that arises among the parties under or relating to this Agreement that is not amicably
settled shall be submitted to mediation. If the parties remain unable to resolve the controversy
through mediation, then exclusive venue of any dispute shall be a state court or federal district
court where the services are being performed.
f. If any provision of this Agreement is declared invalid or unenforceable, then such provision
shall be severed from and shall not affect the remainder of this Agreement; however, the Parties
shall amend this Agreement to give effect, to the maximum extent allowed, to the intent and
meaning of the severed provision.
g. Any waiver of any breach of covenants herein contained to be kept and performed by the either
Party shall not be deemed or considered as a continuing waiver and shall not operate to bar or
prevent a Party from declaring a forfeiture for any succeeding breach either of the same condition
of covenant or otherwise. A Party's remedies hereunder are not exclusive and are in addition to any
other remedies at law or in equity. A Party shall not be deemed to waive any remedy available to it
or any right under this Agreement, at law or in equity, by virtue of any act or forbearance in
enforcing such rights or remedies.
h. Any additions or modifications to this Agreement shall only be made in writing and signed by
both Parties.
i. This Agreement shall not be construed to create any rights hereunder in any person or entity
other than the Parties to this Agreement.
j. Each party has cooperated in the drafting and preparation of this Agreement and/or has had
the opportunity to consult with legal counsel in regards to its terms and conditions. In any
construction or interpretation of this Agreement, the same shall not be construed against any party.
BY SIGNING BELOW EACH SIGNATORY WARRANTS THAT HE OR SHE IS
AUTHORIZED TO ENTER INTO A BINDING AGREEMENT ON BEHALF OF THE PARTY
SET FORTH BELOW.
EFFECTIVE AS OF THE
140 .VtTil61 oil'?
CITY OF BEAUMONT, TEXAS
By:
Kyle Hayes, City Manager
ATTEST:
By:
Tina Broussard, City Clerk
DAY OF , 2016.
8
COMPANY:
WM RECYCLE AMERICA, LLC.
By: `
Don Smith, Presi nt
EXHIBIT A
SPECIFICATIONS
RECYCLABLES shall be loose, not bagged, and include the following:
Aluminum food and beverage containers - empty
Printer paper; Copier Paper
Mirrors
Telephone books; Mail
Light Bulbs
Ferrous (iron, steel, tin) cans — empty
PET plastic containers with the symbol #1 — with
screw tops only — empty
HDPE natural rigid plastic containers with the
symbol*2 (milk -and -water -bottles-) - empty
HDPE pigmented rigid plastic containers with the
-symbol-#? (detergen"hampoo bottles, etc.) -
empty
Mixed Rigid Plastic tubs or containers with
symbols #3, #4, #5, #6, #7T em
Newsprint
Old corrugated cardboard containers/boxes/sheets
Magazines, glossy inserts and pamphlets
Catalogs
Cereal boxes; detergent, gift and snack boxes
Aseptic gable -top milk and juice cartons
Rigid Plastics (unnumbered) such as milk/soda
crates, plastic buckets, plastic laundry baskets, etc.
that fit into the Polycart and are no more than 30"
long and no more than 10 pounds each
All other office paper without wax liners
Household metal cooking pots, pans, and utensils
which are no more than 30 inches long and not
more than 50 pounds each
All materials not specifically listed above as Recyclables are Non-Recyclables.
RECYCLABLES do NOT include the following:
Bagged materials (even if containing Rec clables)
Microwave trays
Mirrors
Window or auto glass
Light Bulbs
Ceramics
Porcelain
Plastics unnumbered
Plastic bas
Wire/metal hangers
Expanded polystyrene or polystyrene foam
(e.., foam packingpeanuts)
Household items such as cooking pots,
toasters, etc.
Glass cookware/bakeware
Wet fiber
Flexible packaging and multi -laminated materials
I Fiber containing, or that has been in contact with,
food debris or other contaminating material
Excluded Materials
Tissues, paper towels or other material that
has been in contact with food
Any recyclable materials, or pieces of recyclable
materials, less than 2" in size in any dimension
Materials: (a) that contain chemical or other
properties deleterious, or capable of causing
IN
Glass food and beverage containers brown, clear or material damage, to any part of Company's property,
green its personnel or the public; and/or (b) that may
materially impair the strength or the durability of the
lCompany's structures orequipment.
DELIVERY SPECIFICATIONS:
Single Stream Materials delivered by or on behalf of Customer may not contain more than twenty-five
percent (25%) Nan-Reeyclables by weight of any incoming Load of Single Stream Recyclable Materials.
In the event a Load of Single Stream Materials does not meet Specifications, the Load may be rejected
and/or Customer may be charged additional transportation or disposal costs. Company has the right to
dispose of all Residue and Non-Recyclables.
IfCompany-rejects- Load of Single -Steam Materials that does not meet -Specifications Customer will be
notified promptly by phone or email of the rejection and Customer will have no more than four (4) hours
from receiving notification to arrive at the Designated Facility to view the rejected Load. If Customer
indicates it will send a representative to the Designated Facility within 4 hours, Company agrees not to
remove the rejected Load from the Designated Facility until after the representative arrives and views the
Load.
E
EXHIBIT B
COMPOSITION AUDITS
The Company shall conduct two Single Stream Materials' composition audits each year at its expense in
accordance with the following:
1. The audits will be conducted in March and October each year at Company's expense. The
parties shall mutually agree on the specific dates and times to conduct the audits.
2. Each audit will be monitored by both the Company and the Customer.
3. Such audits will not be conducted immediately after a holiday or during inclement weather.
4. Unless agreed to in writing by the Customer, the Customer and the Company shall agree on an
auditdate_aLleast_a minimum_ofthirty (30) calendardaysin_advanee—Company will -empty the
sort line, bunkers, and balers in advance of the scheduled audit, and will ensure that there are
sufficient personnel available to perform the sorting.
5. The Customer and the Company will agree to the description of each RecycIable$' commodity
in advance of the audit in written form.
6. The Company and Customer shall jointly agree to the vehicles selected for the audit. Those
vehicles will be weighed full and empty to capture the tare weight of the truck and the weight
of the Load. On -file tare weights will not be acceptable during the audit.
7. The Company shall store the Loads from the selected Customer Vehicles in a segregated area.
The segregated area will have barriers in place to separate audit materials from any other
materials that are delivered to the Designated Facility.
8. Immediately prior to processing the audit materials, the Company will empty, clean and make
free of debris the system, sort line, bunkers, and balers. The tipping floor will be empty, clean
and free of debris, with the exception of the segregated audit materials.
9. The Customer and the Company will ensure the number of employees available for the audit
is appropriate to sort material and conduct the audit. The number of employees utilized for
sorting materials will be consistent with typical operations.
10. The material in the bunker will be loaded onto the single stream line and processed at normal
processing speed. Once all the material from the bunker has been processed, each commodity
will be baled, weighed, and documented. The Company will process Recyclable Materials into
the various commodity categories and Residue.
11. Once the MRF sort line and employees have processed all audit material, each commodity will
be baled, weighed and documented with Customer representatives present. Each individual
commodity bunker will be baled one at a time. Residue will be weighed separately.
12. The Customer may either conduct or request an audit of bale quality of selected bales at its own
cost. Such audit of selected bales must be scheduled in advance with the Company.
13. At the end of the audit day, tally sheets of all bales counted and a copy of the scale ticket for
each commodity and the Residue shall be provided to the Customer.
14. Within five (5) business days of the completed audit, the Company will provide a report
detailing the individual truck tare weights, baled weights, and updated composition table.
15. Either party may request a new audit within thirty (30) days of receiving an audit report. The
requesting party shall be required to pay all costs of the new audit.
16. The Customer may take pictures prior to and during the audit.
12
EXHIBIT
BLENDED VALUE/CHARGES
L VALUE SHARE
Where the Blended Value is greater than the Processing Fee, Customer's Value Share is 70% of the
difference between the Blended Value and the Processing Fee. When the Blended Value is less than the
Processing Fee, Customer shall pay Company the difference between the Blended Value and the
Processing Fee pursuant to section 4.a of this Agreement.
2. BLENDED VALUE
To calculate the BIended Value per ton of the Single Stream,
(a) The percentage of each Recyclable and Non -Recyclable component set forth below contained in the
Single Stream Materials as established and revised from time -to -time by the Composition Audits, is
multiplied by the current value of each commodity set forth below; and
(b) Each commodity value per ton is added together to obtain the Blended Value per ton.
(c) Customer acknowledges that the value of a commodity may be negative.
Blended Value s calculat—ed monthly.
a. "PPW" means the higher of the prices issued by RISI PPI Pulp & Paper Week for the Southwest
Region, Domestic Price, I st issue of the month retroactive to the first of the month.
b. "SMP" means the average of the price published at www.SecondaryMateriaisPricing.com, for the
Southcentral Region (Houston), first dated price each month, retroactive to the first of the month.
c. "Actual Value" means the average price paid to or charged to the Designated Facility during the
month of delivery of the Single Stream Materials. Freight, customs charges, duties, or other charges
paid to third parties for the sale of such Recyclables are excluded from the definition of Actual
Value.
d. If PPW or SMP (or both) is no longer reflective of prevailing market conditions or if
an alternative publication more accurately reflects such market conditions, then
Company may propose to use any such alternative publication(s) or alternate method
to determine the value of each commodity set forth below. Customer's consent, which
shall not be unreasonably withheld, conditioned or delayed, to the use of such alternate publication
or method shall be required.
e. "Transportation & Disposal" means the charge for transporting and disposing the Non-Recyclables
and Residue at the Designated Facility per Ton in the month of delivery to the disposal facility. All
Residue and/or Non-Recyclables will be disposed of at the Newton County Landfill, located in
Newton County, Texas.
Material Component
Commodi Value (may be positive or negative)
Newspapers, magazines and inserts
PPW Mixed Paper #2
Cardboard
PPW OCC 411
All other paper
PPW #2 Mixed Paper
Aluminum / beverage cans
SMP for Aluminum Cans (Sorted, Baled,
0/Ib, delivered)
Steel/Tin
SMP for Steel Cans Sorted, Baled, ¢/Ib, delivered)
Plastic #1
SMP for PET baled, ¢/Ib, picked u
Plastic #2 Natural
SMP for Natural HDPE baled, 0/lb. picked up)
Plastic #2 Colored
SMP for Colored HDPE baled, /Ib. picked u
#347 Plastics
Actual Value
Rigid Plastics
Actual Value
13
Cartons Actual Value
Residue Transportation & Disposal
3. CHARGES
(a) Customer shall pay the Processing Fee for each Ton of Single Stream Materials delivered by or on
behalf of the Customer. The initial Processing Fee is $90.00 per Ton.
(b) The Company has the right to increase the Processing Fee in accordance with changes in the applicable
CPI as calculated below on the anniversary of the Effective Date ("Anniversary Date"). Such CPI
adjustment shall be effective on such Anniversary Date and shall be recalculated and effective each
Anniversary Date thereafter. The increases to the Processing Fee shall be based on the average percentage
change in the CPI for the twelve (12) month period ending one month prior to the Anniversary Date. The
adjustments in the CPI shall be capped at 4% on each Anniversary Date. In the event this CPI is no longer
viable or no longer reflective of consumer prices in Customer's geographic region, another consumer
pricing index or method of adjustment may be used as a replacement for the CPI, subject to the mutual
consent of the Parties. Failure by Company to submit such CPI price adjustment shall not preclude the
implementation of such adjustment as of the Anniversary Date.
(c) Company shall also be entitled to an increase in the Processing Fe_e from time to time during the term
of this Agreement, and upon thirty (30) days' written notice to the Customer, to offset any Uncontrollable
Circumstances. Whether the Processing Fee is increased in accordance with section 3(b) or 3(c) of this
agreement, the total Processing Fee shall not increase by more than 4% of the CPI per year as specified in
section 3(b).
(d) Company agrees to provide Customer with back-up documentation of the charges that Company
incurs for Transportation & Disposal of Non-Recyclables and Residue to the disposal facility.
4. BLENDED VALUE / REVENUE SHARE / NET VALUE EXAMPLE
Blended Value Per Ton with Glass as a Non -Recyclable
A
Material
Component
B
Commodity Value
C D
April 2016 Composition
Value Audit Results
(Example) in (Example)
$Ron
E
Blended
Value
C x D
(Example)
$/Ton
TOTAL
BLENDED VALUE 100% 1 $66.40
Cardboard
PPW OCC #11
$75.00 22.1%
$16.58
Mixed paper,
Newspaper,
magazines, inserts
PPW #2 Mixed Paper
$55.00 25.4%
$13.97
Aluminum/ beverage
cans
SMP for Aluminum Cans
$1,200.00 1.7%
$20.40
Steel/Tin
SMP for Steel Cans
$100.00 2.1%
$2.10
Plastic #1
SMP for PET
$200.00 4.3%
$8.60
Plastic #2 Natural
SMP for Natural HDPE
$620.00 1.4%
$8.68
Plastic #2 Colored
SMP for Colored HDPE
$420.00 1.6%
$6.72
Plastic #3 thru #7
Actual Value
1 $80.00 5.7%
$4.56
Cartons
Actual Value
1 $55.00 1.6%
$0.88
Non-Recyclables Et
Transportation It Disposal -$47 19 34.1% 1 -$16.09
Residue'
Cost
TOTAL
BLENDED VALUE 100% 1 $66.40
14
Example Calculation with Glass as a Non -Recyclable Material:
Customer's Value Share is 70% of the Blended Value calculated monthly.
By way of the example (from above), where the:
a. Blended Value is $66.40 per Ton, for each Ton delivered; and
b. the Customer's Value Share is 70% (the Value Share only applies if the Blended Value is higher
than the Processing Fee); and
c, the Processing Fee is $90.00 per Ton, for each Ton delivered; and
the Net Value per Ton, for each Ton delivered, paid to Customer is:
Blended Value of -$66A0 —$90:00 Processing Fee --w--($23.60) for each Ton delivered, paid by -Customer to
Company.
is
STATE OF TEXAS
COUNTY OF JEFFERSON
RECYCLABLE MATERIALS PROCESSING AGREEMENT
THIS RECYCLABLE MATERIALS PROCESSING AGREEMENT ("Agreement") is made
as of the _'L day of September _, 2016 ("Effective Date") by and between WM Recycle America,
LLC, Waste Management of Texas, Inc. and their corporate affiliates and subsidiaries ("Company"), and
the City of Beaumont, a political subdivision of the State of Texas ("Customer"). Customer and Company
are each a "Party" and collectively the "Parties."
1. DESCRIPTION OF WORK
A. For the consideration set forth below, Company agrees to provide single -stream recycling
processing services for the Customer's residential recycling routes (the Services). The Services shall
be performed in a good and workmanlike manner.
B. This Agreement shall be comprised of the following documents:
a. This Agreement and all of its exhibits or attachments ("Contract"); and
b. Company's proposal (the "Proposal").
In the case of a conflict between the language in the Contract and the Proposal, the terms and the conditions
of the Contract shall control and take precedence.
2. TERM
The term of the Agreement shall be one (1) year from the Effective Date (Initial Term). The Agreement
may be renewed for up to two additional one year terms, upon mutual written agreement of the parties. Each
party agrees to provide the other party at least 150-days' written notice before the expiration of the then -
current term of its intent to renew the Agreement. The Initial Term and Renewal Terms are collectively the
"Term."
2. DEFINITIONS
a. "Applicable Law" means any law, regulation, requirement, or order of any Federal, State or local
agency, court or other domestic or foreign governmental body, or interpretation thereof by any court
or administrative agency of competent jurisdiction, and requirements of all permits, licenses, and
governmental approvals applicable to the acquisition, design, construction, equipping, testing,
financing, ownership, possession, or operation of Designated Facilities and performance under this
Agreement.
b. "Blended Value" or "BV" is the total weighted value per Ton of each Recyclable and Non -
Recyclable component (including negatively -valued Recyclables and transfer and disposal costs of
Residue) for the Single Stream Materials delivered by or on behalf of Customer to the Designated
Facility.
c. "Composition Audit" means the basis upon which Single Stream Materials delivered to the
Designated Facility are measured to determine the percentage of each Recyclable, Non -Recyclable,
and Residual component delivered by or on behalf of Customer as further described in Exhibit B.
d. "Processing Fee" means the compensation per Ton for costs incurred by Company to prepare
Recyclables for end markets, i.e., those actions necessary to render Recyclables acceptable to end
markets and/or designated buyers.
e. "CPP' means the Consumer Price Index -All Urban Consumers (CPI-U), US City Average, Garbage
& Trash Collection (CUUROOOOSEHG02), Not Seasonally Adjusted, as published by the United
States Department of Labor, Bureau of Labor Statistics.
f. "Customer" means the City of New Braunfels, Texas and any persons or entities authorized by the
City to collect and transport Recyclables collected from residential units within the City.
g. "Customer's Value Share" means the Customer's percentage of the Blended Value minus the
Processing Fee as set forth on Exhibit C.
h. "Designated Facility" or "Designated Facilities" means Company's Material
Recovery Facility, located at 1995 Cedar, Beaumont, Texas 77701.
i. "Designated Holidays" are New Year's Day, Thanksgiving Day and Christmas Day.
j. "Excluded Materials" means radioactive, volatile, corrosive, flammable, explosive, biomedical,
infectious, biohazardous or toxic substance or material, or regulated medical or hazardous waste as
defined by, characterized or listed under applicable federal, state, or local laws or regulations, and/or
any other waste not approved in writing by Company.
k. "Force Majeure" shall include, but not be limited to, any act of terrorism, act of God, landslides,
lightning, fires, storms, floods, typhoons, hurricanes, severe weather, freezing, earthquakes, volcanic
eruptions, other natural disasters or the imminent threat of such natural disasters, pandemics,
quarantines, civil disturbances, acts of the public enemy, wars, blockades, or public riots, not
reasonably within the control of a Party.
1. "Load(s)" means all materials in a vehicle hauled to the Designated Facility for unloading and
processing.
In. "Net Value" means the amount paid to Customer by Company (or owed by Customer to Company)
calculated as set forth on Exhibit C.
n. "Non-Recyclables" means any materials in the Single Stream Materials that are not Recyclables as
set forth in Exhibit A.
o. "Receiving Hours" means the regularly -scheduled hours of operation for the Designated Facility
p. "Recyclables" means acceptable materials contained within the Single Stream Materials as set forth
and further defined in Exhibit A.
q. "Residue" or "Residual" means (i) material that cannot be safely or effectively processed and/or
(ii)material that, after processing, cannot be effectively marketed for sale in its current state, and/or
(iii) Non-Recyclables, each of which will be disposed.
2
r. "Single Stream Materials" means all of the materials delivered by or on behalf of Customer to
Company containing Recyclables and Non-Recyclables.
s. "Specifications" means the description of the Single Stream Materials as set forth in Exhibit A.
t. "Ton" means 2,000 pounds.
u. "Uncontrollable Circumstances" means acts of domestic (federal, state or local) or foreign
governments or governmental agencies or governmental restraint, changes in laws, rules,
regulations, fees, or taxes.
3. QUANTITY AND QUALITY
a. During the term of the Agreement, Customer shall provide one hundred percent (100%) of the Single
Stream Materials collected by or on behalf of Customer, and Company shall receive the Single Stream
Materials. Customer shall not divert, retract, or withdraw, or discontinue collection of any material listed as
a Recyclable in Exhibit A unless Customer and Company mutually agree to such action. Customer and
Company shall not allow scavenging of any Recyclables from the Single Stream Materials. Any additions
to the list of acceptable Recyclables in Exhibit A will require the mutual agreement of Customer and
Company.
b. Customer represents and warrants that it shall provide and deliver the Single Stream Materials in
accordance with the Specifications set forth in Exhibit A. Title to Recyclables provided by Customer or its
designated hauler(s) to Company is transferred to Company upon Company's receipt or collection unless
otherwise provided in this Agreement or Applicable Law. Title to and liability for Excluded Materials shall
remain with Customer or the generator of the material at all times.
c. Composition Audits shall be performed by Company in accordance with Exhibit B on Single Stream
Materials delivered to the Designated Facility by or on behalf of Customer in order to identify the overall
material composition and associated Blended Value.
d. This Agreement does not include and Company is not providing any confidential or secure shredding
or handling of confidential information that may be contained in, on, or within the Single Stream Materials.
Documents, data, or materials that contain confidential or private information, the destruction or
management of which is regulated by state or federal privacy or data security laws, regulations, or rules,
such as the Health Insurance Portability and Accountability Act of 1996, as amended, are not to be deposited
for recycling under this Agreement.
e. Company represents that its Designated Facility has the capacity to process the City's Single Stream
Materials. Company agrees that has the ability to provide reserve storage capacity on -site at the Designated
Facility for at least four (4) days of delivered Loads, in case of an equipment breakdown or other issue. The
Designated Facility has adequate and safe unloading and maneuvering room for City vehicles, both inside and
outside the facility, including a minimum of 30 feet of unrestricted floor to ceiling clearance.
4. PRICING/PAYMENTS/CHARGES
a. Payments and charges to Customer shall be calculated as set forth on Exhibit C. Where the Net Value of
the Single Stream Recyclables is positive, Company shall pay Customer on or about the last day of the month
following delivery for those Single Stream Recyclables meeting the Specifications delivered during the
preceding month. Where the Net Value is negative, the Customer shall pay Company on or about the
last day of the month following delivery for those Single Stream Recyclables meeting the Specifications
delivered during the preceding month.
5. DELIVERIES/HOURS
a. Customer shall deliver Single Stream Materials at Customer's expense to the Designated Facility during
Receiving Hours. All Single Stream Materials must be delivered in self -dumping trucks and will be weighed
in and out by Company at the Designated Facility. Company shall use reasonable efforts to provide a wait
time for Customer's delivery vehicles that averages fifteen (15) minutes or less, barring any unique or
infrequent circumstances beyond Company's control.
b. The Receiving Hours at the Designated Facility are Monday through Friday from 7:00 a.m. to 4:00 p.m.,
except for Designated Holidays.
c. Customer may request after-hours tipping of Single Stream Materials at the Designated Facility in order
to deliver material after 5:00 p.m. Customer shall request such after-hours access in writing at least 24 hours
prior to the time Customer seeks such access. Company will make reasonable efforts to accommodate this
request for after-hours access.
6. DESIGNATED FACILITY STANDARDS
a. Company shall provide certified scales for weighing Single Stream delivered to the Designated Facility.
Scales shall be regularly calibrated as required by Applicable Law. Upon request from the Customer, Company
shall make available to Customer on a monthly basis weight tickets for each load of Single Stream delivered by
Customer. Customer's Single Stream Materials Loads shall be weighed at the Designated Facility and Company
shall provide daily tickets reflecting the net weight of the Loads to the City's drivers.
b. If Excluded Materials are delivered to the Facility by or on behalf of Customer, Company, in its sole
discretion, may reject the entire load, or separately contain, set aside, segregate, isolate and manage such
Excluded Materials as required by Applicable Law. Customer will be notified promptly by phone or email of
the location, general character and amount of such Excluded Materials, and Customer will have no more than
4 hours from receiving notification to arrive at the Facility to view the Excluded Materials. If Customer indicates
it will send a representative to the Facility within 4 hours, Company agrees not to remove the Excluded
Materials from the Facility until after the representative arrives and views the Excluded Materials. If requested
by Company, Customer must remove within 24 hours of notification, or cause to be removed, such Excluded
Materials from the Designated Facility and shall transport and dispose of, or shall cause such Excluded
Materials to be transported and disposed, in accordance with Applicable Law. If Customer fails to timely
remove such Excluded Materials, Company may, after providing verbal or written notice to Customer, transport
and dispose of such Excluded Materials and charge the costs thereof to Customer.
c. Company shall recycle the Recyclables for reuse and, provided that there is a commercially reasonable
available market for such material, shall not dispose of any Recyclables, except such Residue left after
processing of the Single Stream Materials. Company makes no representations as to the marketability of the
Recyclables and may dispose of Recyclables when no reasonable commercial market exists. Company shall
provide Customer with written notice no more than 3 days after the decision is made to begin disposing of a
Recyclable due to market conditions along with information and/or documentation substantiating such
decision. Should no commercially reasonable available market for a Recyclable exist, such Recyclable shall
be classified as a Non -Recyclable until such time as a commercially reasonable available market exists.
Company reserves the right to add or delete materials from the list of Recyclables based upon changes in
market conditions, uncontrollable circumstances, governmental restraint, or changes in laws,
rules, regulations, or ordinances, or changes in the enforcement thereof, and Company will provide written
notice of any such change to the Customer.
4
d. Company shall provide its services hereunder and take reasonable care to operate its Designated
Facility in accordance with standard industry practices.
7. PUBLIC EDUCATION AND OUTREACH/REPORTS
a. Customer and Company agree to use reasonable efforts to inform and educate residents of the quality
requirements hereunder and to enforce the standards and Specifications for acceptance of Single Stream
Materials.
b. Company shall provide monthly and annual reports to the City, which provide the following
information: (i) total tons of Single Stream Materials received; (ii) total tons of Residue or Non-Recyclables
received and disposed; and (iii) the Net Value (the amount paid to Customer by Company or owed by
Customer to Company) calculated each month.
S. INSURANCE
Company shall maintain, at its expense, insurance with limits not less than those prescribed below. With
respect to required insurance, Company shall:
i. Name the City of Beaumont as additional insured/or an insured, as its interests may appear, except
as to Company's workers' compensation coverage.
ii. Provide the City a waiver of subrogation.
iii. Provide the City with a thirty (30) calendar day advance written notice of cancellation or material
change to said insurance.
iv. Provide to the City Purchasing Manager a Certificate of Insurance evidencing required coverage
within ten (10) calendar days after receipt of Notice of Award.
Submit a certificate of insurance reflecting coverage as follows:
a. Automobile Liability:
Bodily Injury (Each person) - $250,000.00
Bodily Injury (Each accident) - $500,000.00
Property Damage - $100,000.00
b. General Liability (Including Contractual Liability
Bodily Injury - $500,000.00
Property Damage - $100,000.00
c. Excess Liability:
Umbrella Form - $1,000,000.00
d. Worker's Compensation: - Statutory
e. Pollution Legal Liability/Environmental Impairment Insurance $1,000,000
9. INDEMNIFICATION/LEVHT OF LIABILITY
Company shall indemnify and hold harmless Customer, its employees, agents and officials from any and all
claims, losses or expenses resulting from any accidents, injuries or damages to persons or properties,
suits or demands including reasonable attorney fees which may be made against the Customer, its
employees, agents or officials to the extent caused by Company's negligent act or omission or
willful misconduct, or breach of this Agreement. Company's indemnification obligations will not
apply to occurrences involving Excluded Materials delivered by or on behalf of Customer. Neither
party shall be liable to the other for special, consequential, incidental or punitive damages arising
out of the performance of this Agreement.
10. TERMINATION
a. When a Party has defaulted on one or more material terms of this Agreement, the non -
defaulting Party may terminate this Agreement on thirty (30) days' written notice where such
default has not been cured within such thirty (30) day period. If a Party makes a general
assignment for the benefit of its creditors, files for bankruptcy relief, or has an involuntary
bankruptcy filed against it, the other Party may terminate this Agreement immediately upon
written notice. In the event either Party waives default by the other Party, such waiver shall not be
construed or determined to be a continuing waiver of the same or any subsequent breach or
default. In the event of a default, the non -defaulting Party shall have the right to seek all available
recourse to which it may be entitled by law or in equity, including, but not limited to, the right to
all damages or losses suffered as a result of such termination.
b. Either party may terminate this agreement without cause upon giving to the other party
sixty (60) days written notice of its intent to terminate.
11. NOTICES:
Any notice to be given hereunder shall be sent via certified mail or a nationally -recognized
overnight courier to the addresses below for each Party:
If to Customer: Attn: Kyle Hayes
City Manager
PO Box 3827
Beaumont, TX 77704
If to Company: Public Sector Director
Waste Management
520 E. Corporate,
Suite 100
Lewisville, TX
75057
with a copy to: Waste Management
9708 Giles
Austin, TX 78754
Attn: Senior Legal Counsel; and
CT Corporation
System 350
North St. Paul
Street Dallas,
Texas 75201
6
or such other addresses as the parties may hereafter specify by written notice
delivered in accordance herewith.
12. MISCELLANEOUS:
a. Except for the obligation to make payments hereunder for services already rendered, neither Party
shall be in default or liable to the other Party for its failure, in whole or in part, to perform or delay in
performance caused by Force Majeure, and the affected Party shall be excused from performance
during the occurrence of such events. If either Party delays or fails to return to performance under this
Agreement after the Force Majeure event, then such delay or failure may be considered a default
under this Agreement by the performing Party.
b. This Agreement shall be binding on and shall inure to the benefit of the parties hereto and their
respective successors and assigns.
c. This Agreement, including Exhibits A, B, and C, which are incorporated herein and made a
part hereof, represents the entire agreement between the parties and supersedes any and all other
agreements related to the Recyclables, whether written or oral, that may exist between the Parties
or their affiliates.
d. This Agreement shall be construed in accordance with the law of the state in which this
Agreement is performed.
e. The parties shall endeavor to settle all disputes under, or relating to, this Agreement by
amicable negotiations. Except as otherwise provided herein, any claim, dispute, disagreement or
controversy that arises among the parties under or relating to this Agreement that is not amicably
settled shall be submitted to mediation. If the parties remain unable to resolve the controversy
through mediation, then exclusive venue of any dispute shall be a state court or federal district
court where the services are being performed.
f. If any provision of this Agreement is declared invalid or unenforceable, then such provision
shall be severed from and shall not affect the remainder of this Agreement; however, the Parties
shall amend this Agreement to give effect, to the maximum extent allowed, to the intent and
meaning of the severed provision.
g. Any waiver of any breach of covenants herein contained to be kept and performed by the either
Party shall not be deemed or considered as a continuing waiver and shall not operate to bar or
prevent a Party from declaring a forfeiture for any succeeding breach either of the same condition
of covenant or otherwise. A Parry's remedies hereunder are not exclusive and are in addition to any
other remedies at law or in equity. A Party shall not be deemed to waive any remedy available to it
or any right under this Agreement, at law or in equity, by virtue of any act or forbearance in
enforcing such rights or remedies.
h. Any additions or modifications to this Agreement shall only be made in writing and signed by
both Parties.
i. This Agreement shall not be construed to create any rights hereunder in any person or entity
other than the Parties to this Agreement.
j. Each party has cooperated in the drafting and preparation of this Agreement and/or has had
the opportunity to consult with legal counsel in regards to its terms and conditions. In any
construction or interpretation of this Agreement, the same shall not be construed against any party.
I 00'
BY SIGNING BELOW EACH SIGNATORY WARRANTS THAT HE OR SHE IS
AUTHORIZED TO ENTER INTO A BINDING AGREEMENT ON BEHALF OF THE PARTY
SET FORTH BELOW.
EFFECTIVE AS OF THE � I
CUSTOMER:
CITY OF BEAUMONT, TEXAS
BY: L ty
Kyle Hayes, City Manager
ATTEST:
B nW�
Tina Broussard, City Clerk
DAYOF si?0tv^ber,2016.
COMPANY:
WM RECYCLE AMERICA, LLC.
Don Smith, Prewt
EXHIBIT A
SPECIFICATIONS
RECYCLABLES shall be loose, not bagged, and include the following:
Aluminum food and beverage containers - empty
Printer paper; Copier Paper
Telephone books; Mail
Ferrous (Iron, steel, tin) cans — empty
PET plastic containers with the symbol #1 — with
screw tops only — empty
HDPE natural rigid plastic containers with the
HDPE pigmented rigid plastic containers with the
symbol #2 (milk and water bottles) — empty
symbol #2 (detergent, shampoo bottles, etc.)
emvtv
Mixed Rigid Plastic tubs or containers with
Newsprint
symbols #3 #4 #5 #6 #7 — empty
Old corrugated cardboard containers/boxes/sheets
Magazines, loss inserts and pamphlets
Catalogs
Cereal boxes; detergent, gift and snack boxes
Aseptic gable -top milk and juice cartons
Rigid Plastics (unnumbered) such as milk/soda
crates, plastic buckets, plastic laundry baskets, etc.
that fit into the Polycart and are no more than 30"
long and no more than 10 pounds each
All other office paper without wax liners
Household metal cooking pots, pans, and utensils
which are no more than 30 inches long and not
more than 50 pounds each
All materials not specifically listed above as Recyclables are Non-Recyclables.
RECYCLABLES do NOT include the following:
Bagged materials even if containing Rec clables
Microwave trays
Mirrors
Window or auto glass
Light Bulbs
Ceramics
Porcelain
Plastics unnumbered
Plastic bags
Wire/metal hangers
Expanded polystyrene or polystyrene foam
(e.., foam packing peanuts)
Household items such as cooking pots,
toasters, etc.
Glass cookware/bakeware
Wet fiber
Flexible packaging and multi -laminated materials
Fiber containing, or that has been in contact with,
food debris or other contaminating material
Excluded Materials
Tissues, paper towels or other material that
has been in contact with food
Any recyclable materials, or pieces of recyclable
materials, less than 2" in size in any dimension
Materials: (a) that contain chemical or other
properties deleterious, or capable of causing
Glass food and beverage containers brown, clear or material damage, to any part of Company's property,
een its personnel or the public; and/or (b) that may
materially impair the strength or the durability of the
Company's structures orequipment.
DELIVERY SPECIFICATIONS:
Single Stream Materials delivered by or on behalf of Customer may not contain more than twenty-five
percent (25%) Non-Recyclables by weight of any incoming Load of Single Stream Recyclable Materials.
In the event a Load of Single Stream Materials does not meet Specifications, the Load may be rejected
and/or Customer may be charged additional transportation or disposal costs. Company has the right to
dispose of all Residue and Non-Recyclables.
If Company rejects a Load of Single Steam Materials that does not meet Specifications, Customer will be
notified promptly by phone or email of the rejection and Customer will have no more than four (4) hours
from receiving notification to arrive at the Designated Facility to view the rejected Load. If Customer
indicates it will send a representative to the Designated Facility within 4 hours, Company agrees not to
remove the rejected Load from the Designated Facility until after the representative arrives and views the
Load.
10
EXHIBIT B
COMPOSITION AUDITS
The Company shall conduct two Single Stream Materials' composition audits each year at its expense in
accordance with the following:
1. The audits will be conducted in March and October each year at Company's expense. The
parties shall mutually agree on the specific dates and times to conduct the audits.
2. Each audit will be monitored by both the Company and the Customer.
3. Such audits will not be conducted immediately after a holiday or during inclement weather.
4. Unless agreed to in writing by the Customer, the Customer and the Company shall agree on an
audit date at least a minimum of thirty (30) calendar days in advance. Company will empty the
sort line, bunkers, and balers in advance of the scheduled audit, and will ensure that there are
sufficient personnel available to perform the sorting.
5. The Customer and the Company will agree to the description of each Recyclables' commodity
in advance of the audit in written form.
6. The Company and Customer shall jointly agree to the vehicles selected for the audit. Those
vehicles will be weighed full and empty to capture the tare weight of the truck and the weight
of the Load. On -file tare weights will not be acceptable during the audit.
7. The Company shall store the Loads from the selected Customer Vehicles in a segregated area.
The segregated area will have barriers in place to separate audit materials from any other
materials that are delivered to the Designated Facility.
8. Immediately prior to processing the audit materials, the Company will empty, clean and make
free of debris the system, sort line, bunkers, and balers. The tipping floor will be empty, clean
and free of debris, with the exception of the segregated audit materials.
9. The Customer and the Company will ensure the number of employees available for the audit
is appropriate to sort material and conduct the audit. The number of employees utilized for
sorting materials will be consistent with typical operations.
10. The material in the bunker will be loaded onto the single stream line and processed at normal
processing speed. Once all the material from the bunker has been processed, each commodity
will be baled, weighed, and documented. The Company will process Recyclable Materials into
the various commodity categories and Residue.
11. Once the MRF sort line and employees have processed all audit material, each commodity will
be baled, weighed and documented with Customer representatives present. Each individual
commodity bunker will be baled one at a time. Residue will be weighed separately.
11
12. The Customer may either conduct or request an audit of bale quality of selected bales at its own
cost. Such audit of selected bales must be scheduled in advance with the Company.
13. At the end of the audit day, tally sheets of all bales counted and a copy of the scale ticket for
each commodity and the Residue shall be provided to the Customer.
14. Within five (5) business days of the completed audit, the Company will provide a report
detailing the individual truck tare weights, baled weights, and updated composition table.
15. Either party may request a new audit within thirty (30) days of receiving an audit report. The
requesting party shall be required to pay all costs of the new audit.
16. The Customer may take pictures prior to and during the audit.
12
EXHIBIT C
BLENDED VALUE/CHARGES
1. VALUE SHARE
Where the Blended Value is greater than the Processing Fee, Customer's Value Share is 70% of the
difference between the Blended Value and the Processing Fee. When the Blended Value is less than the
Processing Fee, Customer shall pay Company the difference between the Blended Value and the
Processing Fee pursuant to section 4.a of this Agreement.
2. BLENDED VALUE
To calculate the Blended Value per ton of the Single Stream,
(a) The percentage of each Recyclable and Non -Recyclable component set forth below contained in the
Single Stream Materials as established and revised from time -to -time by the Composition Audits, is
multiplied by the current value of each commodity set forth below; and
(b) Each commodity value per ton is added together to obtain the Blended Value per ton.
(c) Customer acknowledges that the value of a commodity may be negative.
Blended Value is calculated monthly.
a. "PPW" means the higher of the prices issued by RISI PPI Pulp & Paper Week for the Southwest
Region, Domestic Price, 1 st issue of the month retroactive to the first of the month.
b. "SMP" means the average of the price published at www.Secondgo MaterialsPricing com, for the
Southcentral Region (Houston), first dated price each month, retroactive to the first of the month.
c. "Actual Value" means the average price paid to or charged to the Designated Facility during the
month of delivery of the Single Stream Materials. Freight, customs charges, duties, or other charges
paid to third parties for the sale of such Recyclables are excluded from the definition of Actual
Value.
d. If PPW or SMP (or both) is no longer reflective of prevailing market conditions or if
an alternative publication more accurately reflects such market conditions, then
Company may propose to use any such alternative publication(s) or alternate method
to determine the value of each commodity set forth below. Customer's consent, which
shall not be unreasonably withheld, conditioned or delayed, to the use of such alternate publication
or method shall be required.
e. "Transportation & Disposal" means the charge for transporting and disposing the Non-Recyclables
and Residue at the Designated Facility per Ton in the month of delivery to the disposal facility. All
Residue and/or Non-Recyclables will be disposed of at the Newton County Landfill, located in
Newton County, Texas.
Material Component
Commodity Value (may be positive or negative)
Newspapers, magazines and inserts
PPW Mixed Paper #2
Cardboard
PPW OCC #11
All other paper
PPW #2 Mixed Paper
Aluminum / beverage cans
SMP for Aluminum Cans (Sorted, Baled,
/lb, delivered
SteeUTin
SMP for Steel Cans Sorted, Baled, ¢/lb, delivered
Plastic # 1
SMP for PET(baled, /lb. picked u
Plastic #2 Natural
SMP for Natural HDPE baled, ¢/lb. picked u
Plastic #2 Colored
SMP for Colored HDPE baled, /lb. picked u
#347 Plastics
Actual Value
Rigid Plastics
Actual Value
13
Cartons Actual Value
Residue Transportation & Disposal
3. CHARGES
(a) Customer shall pay the Processing Fee for each Ton of Single Stream Materials delivered by or on
behalf of the Customer. The initial Processing Fee is $90.00 per Ton.
(b) The Company has the right to increase the Processing Fee in accordance with changes in the applicable
CPI as calculated below on the anniversary of the Effective Date ("Anniversary Date"). Such CPI
adjustment shall be effective on such Anniversary Date and shall be recalculated and effective each
Anniversary Date thereafter. The increases to the Processing Fee shall be based on the average percentage
change in the CPI for the twelve (12) month period ending one month prior to the Anniversary Date. The
adjustments in the CPI shall be capped at 4% on each Anniversary Date. In the event this CPI is no longer
viable or no longer reflective of consumer prices in Customer's geographic region, another consumer
pricing index or method of adjustment may be used as a replacement for the CPI, subject to the mutual
consent of the Parties. Failure by Company to submit such CPI price adjustment shall not preclude the
implementation of such adjustment as of the Anniversary Date.
(c) Company shall also be entitled to an increase in the Processing Fee from time to time during the term
of this Agreement, and upon thirty (30) days' written notice to the Customer, to offset any Uncontrollable
Circumstances. Whether the Processing Fee is increased in accordance with section 3(b) or 3(c) of this
agreement, the total Processing Fee shall not increase by more than 4% of the CPI per year as specified in
section 3(b).
(d) Company agrees to provide Customer with back-up documentation of the charges that Company
incurs for Transportation & Disposal of Non-Recyclables and Residue to the disposal facility.
4. BLENDED VALUE / REVENUE SHARE / NET VALUE EXAMPLE
Blended Value Per Ton with Glass as a Non -Recyclable
A
Material
Component
B
Commodity Value
C
April2016
Value
(Example) in
$/Ton
D
Composition
Audit Results
(Example)
E
Blended
Value
C x D
(Example)
$/Ton
Cardboard
PPW OCC #11
$75.00
22.1%
$16.58
Mixed paper,
Newspaper,
magazines, inserts
PPW #2 Mixed Paper
$55.00
25.4%
$13.97
Aluminum/beverage
cans
SMP for Aluminum Cans
$1,200.00
1.7%
$20.40
Steel/Tin
SMP for Steel Cans
$100.00
2.1%
$2.10
Plastic #1
SMP for PET
$200.00
4.3%
$8.60
Plastic #2 Natural
SMP for Natural HDPE
$620.00
1.4%
$8.68
Plastic #2 Colored
SMP for Colored HDPE
$420.00
1.6%
$6.72
Plastic #3 thru #7
Actual Value
$80.00
5.7%
$4.56
Cartons
Actual Value
$55.00
1.6%
$0.88
Non-Recyctables Et
Transportation Et Disposal
- $47.19
34.1%
$16.09
Residue"
Cost
TOTAL
BLENDED VALUE
100•0
$66.40
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Example Calculation with Glass as a Non -Recyclable Material:
Customer's Value Share is 70% of the Blended Value calculated monthly.
By way of the example (from above), where the:
a. Blended Value is $66.40 per Ton, for each Ton delivered; and
b. the Customer's Value Share is 70% (the Value Share only applies if the Blended Value is higher
than the Processing Fee); and
c. the Processing Fee is $90.00 per Ton, for each Ton delivered; and
the Net Value per Ton, for each Ton delivered, paid to Customer is:
Blended Value of $66.40 - $90.00 Processing Fee = ($23.60) for each Ton delivered, paid by Customer to
Company.
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