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HomeMy WebLinkAbout123791 2 RESOLUTION NO. 12,379 3 A RESOLUTION TO AUTHORIZE THE CITY MANAGER TO ENTER INTO AN 4 AGREEMENT WITH JOHNSON CONTROLS, INC. FOR JOHNSON CONTROLS, 5 INC. TO INSTALL, OPERATE AND MAINTAIN A LANDFILL GAS -TO- ENERGY 6 SYSTEM, AND TO PROVIDE SERVICES REGARDING THE LANDFILL GAS-TO- 7 ENERGY SYSTEM, WHICH WILL RESULT IN PROJECT BENEFITS AS SET FORTH 8 IN THE ASSURED PERFORMANCE GUARANTEE; AND FOR OTHER PURPOSES. 9 10 WHEREAS, the City owns and operates a solid waste management facility ( "Landfill ") and 11 desires to collect and sell methane gas from the Landfill ( "Landfill Gas "), and 12 WHEREAS, in May of 2004, the City issued Request for Qualifications ( "RFQ ") #4247 for a 13 Landfill Gas -to- Energy System for the City's Landfill, and 14 WHEREAS, Johnson Controls, Inc. ( "JCI ") was the only respondent to this RFQ, and JCI's 15 response was deemed responsible and responsive, and 16 WHEREAS, the City desires to enter into an agreement with JCI for JCI to install, operate and 17 maintain a Landfill Gas system at the City's Landfill, as delineated in the Scope of Work 18 Schedule, which will result in Project Benefits as set forth in the Assured Performance 19 Guarantee, and 20 WHEREAS, after installation of the Landfill Gas system, JCI agrees to provide the services 21 identified in the Services Schedule that include services that are necessary to monitor, measure 22 and achieve the identified Project Benefits, subject to the terms of the Assured Performance 23 Guarantee. 24 NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF LITTLE 25 ROCK, ARKANSAS: 26 Section 1. The City Manager is authorized to enter into an Agreement with Johnson 27 Controls, Inc., in substantially the same form as the agreement attached as Exhibit A, whereby 28 Johnson Controls, Inc. will install, operate and maintain a Landfill Gas system, as delineated in [PAGE 1 OF 39] 1 the Scope of Work Schedule, which will result in Project Benefits as set forth in the Assured 2 Performance Guarantee. 3 Section 2. After installation of the Landfill Gas system, JCI agrees to provide the services 4 identified in the Services Schedule that include services that are necessary to monitor, measure 5 and achieve the identified Project Benefits, subject to the terms of the Assured Performance 6 Guarantee. 7 Section 3. The Installation Term of this Agreement shall begin on the Commencement Date, 8 which shall be the date of execution of the Agreement by both parties. If the Work is divided 9 into phases or individual projects for which individual prices have been negotiated, then 10 separate Commencement Dates shall apply to each phase or individual project, and each 11 Commencement Date for each phase or individual project shall be acknowledged by the parties 12 in writing. The Work shall be completed by the Substantial Completion Date, which shall be the 13 earlier of: 14 (a) the date on which the City executes a Certificate of Substantial Completion; or 15 (b) ten (10) months after the Commencement Date, subject to adjustments as set 16 forth in Paragraph 3, Delays and Force Majeure, of the Agreement. 17 If the Work is divided into phases or individual projects for which individual prices have 18 been negotiated, then separate Substantial Completion Dates shall apply to each phase or 19 individual project, and each Substantial Completion Date for each phase or individual project 20 shall be acknowledged by the parties in writing. Substantial Completion means that JCI has 21 provided sufficient materials and services to permit the operation of the Equipment or achieve 22 the intended Project Benefits. The Services shall commence on the Substantial Completion Date 23 and shall continue for fifteen (15) years thereafter. The term of the Assured Performance 24 Guarantee shall coincide with the term of the Services Schedule, and the Payment Term shall be 25 I defined in Price and Payment Term Schedule. 26 Section 4. Severabi/ity. In the event any title, section, paragraph, item, sentence, 27 clause, phrase, or word of this resolution is declared or adjudged to be invalid or 28 unconstitutional, such declaration or adjudication shall not affect the remaining portions of the PAGE 2 OF 391 1 2 M 4 5 6 7 8 9 10 resolution which shall remain in full force and effect as if the portion so declared or adjudged invalid or unconstitutional was not originally a part of the resolution. Section 5. Repealer. All laws, ordinances, resolutions, or parts of the same, that are inconsistent with the provisions of this resolution, are hereby repealed to the extent of such inconsistency. ADOPTED: November 6, 2006 + ATTEST: APPROVED: Na cy Wood/,City Clerk 11 12 APPROVED AS TO LEGAL FORM: 13 14 - -- - = - - - -- - -- 15 Thomas M. Carpenter, City A rney 16 17 18 19 20 21 22 23 24 25 26 27 28 29 [PAGE 3 OF 391 Dailey, Mayor 1 EXHIBIT A 2 PERFORMANCE CONTRACT 3 4 PARTIES: 5 6 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 PROJECT: JOHNSON CONTROLS, INC. ( "JCI ") 10801 Executive Center Drive, Suite 103 Shannon Building Little Rock, Arkansas 72211 Attn: Melanie Hayes, Account Executive City of Little Rock Arkansas ( "Customer ", or "City of Little Rock ") 500 West Markham Street Little Rock, Arkansas 72201 Attn: Bruce Moore, City Manager City of Little Rock, Department of Public Works, Division of Solid Waste Services, Landfill Gas -to- Energy System (Direct Use) for Class 1 Landfill, Ironton Cutoff Road. AGREEMENT DOCUMENTS: In addition to the terms and conditions of this Performance Contract, incorporated into this Agreement are the following (check as applicable). X Schedule 1 —Scope of Work Schedule X Schedule 2— Assured Performance Guarantee Schedule X Exhibits 1 through 2 - Guarantee Terms X Exhibits 3 through 6 - Supporting Documentation X Schedule 3— Services Schedule X Schedule 4 —Price and Payment Terms Schedule X Schedule 4a— Payment Schedule X Schedule 4b— Project Schedule X Exhibit A - Collection &t Flare, Dehydration /Compression It Transmission System Layout X Exhibit B - Landfill Gas Specification X Exhibit C - Landfill Gas Content Analysis X Exhibit D Executed Copy of Long -Term Utility Purchase Agreement 1. SCOPE OF THE AGREEMENT. JCI agrees to install identifiable improvements as delineated in Scope of Work Schedule (Schedule 1) which will result in Project Benefits as set forth in the Assured Performance Guarantee (Schedule 2). After installation of the improvement measures, JCI agrees to provide the services identified in Services Schedule (Schedule 3), that include services that are necessary to monitor, measure, and achieve the identified Project Benefits, subject to the terms of the Assured Performance Guarantee (Schedule 2). The Customer MUST provide prior approval of all equipment, controls and methods of installation before purchase or installation. In addition the Customer MUST provide approval for all specifications of the system design, including installation locations and methods, equipment types and locations, before purchase and installation. JCI shall be entitled to rely on the accuracy of all information furnished by the Customer, including without limitation the as -built drawings for the Landfill's construction, and the Customer agrees to accept sole responsibility for any errors, omissions, inaccuracies or inconsistencies contained in the information furnished by the Customer. The Customer agrees to take all reasonable actions identified in this Agreement that are necessary to achieve the Project Benefits identified. JCI shall supervise and direct the Work and Services and shall be solely responsible for all construction means, methods, techniques, sequences, and procedures and for coordinating all portions of the Work and Services under this Agreement. JCI shall be solely responsible to pay for all labor, materials, equipment, tools, construction equipment and machinery, transportation, and other facilities and services necessary for the proper execution and [PAGE 4 OF 391 1 completion of the Work, whether temporary or permanent and whether or not incorporated or to 2 be incorporated in the Work and Services. The Customer's payments to JCI and its interest in the 3 Equipment will be based upon the terms of Schedule 4. 4 2. TERM. The Installation Term of this Agreement shall begin on the Commencement Date, which 5 shall be the date of execution of this Agreement by both parties. If the Work is divided into phases 6 or individual projects for which individual prices have been negotiated, then separate 7 Commencement Dates shall apply to each phase or individual project, and each Commencement 8 Date for each phase or individual project shall be acknowledged by the parties in writing. The 9 Work shall be completed by the Substantial Completion Date, which shall be the earlier of: 10 (c) the date on which the Customer executes a Certificate of Substantial Completion; or 11 (d) ten (10) months after the Commencement Date, subject to adjustments as set forth in 12 Paragraph 3 below. 13 If the Work is divided into phases or individual projects for which individual prices have been 14 negotiated, then separate Substantial Completion Dates shall apply to each phase or individual 15 project, and each Substantial Completion Date for each phase or individual project shall be 16 acknowledged by the parties in writing. Substantial Completion means that JCI has provided 17 sufficient materials and services to permit the operation of the Equipment or achieve the intended 18 Project Benefits. The Services shall commence on the Substantial Completion Date and shall 19 continue for fifteen (15) years thereafter. The term of the Assured Performance Guarantee (see 20 Schedule 2) shall coincide with the term of the Services Schedule (see Schedule 3). If for any 21 reason, the Customer cancels or breaches this Agreement, including but not limited to the Service 22 Schedule, the Assured Performance Guarantee shall automatically terminate. The Payment Term 23 shall be defined in Price and Payment Term Schedule (Schedule 4). 24 3. DELAYS AND FORCE MAJEURE. JCI shall not be responsible for any delay in the performance of the 25 Work resulting from events beyond JCI's control and without JCI's negligence. Events that shall be 26 deemed to be beyond the control of JCI shall be limited to: acts of God or the public enemy; 27 expropriation or confiscation of facilities by governmental or military authorities; war; riots; 28 floods, fires, explosions; bankruptcy of outside vendors, materialmen or suppliers; and delays in 29 deliveries resulting directly from any of the foregoing events. JCI shall provide the City of Little 30 Rock with immediate written notice of the existence, extent of, and reason for such delays. An 31 equitable adjustment in Substantial Completion Date may be made as a result. 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 4. ACCESS. Customer is responsible to provide JCI and its subcontractors reasonable access to all facilities and properties that are in the Customer's control which are subject to the Work and Services contained in this Agreement. Customer further agrees to assist JCI and its subcontractors to gain access to facilities and properties that are not controlled by the Customer which are subject to the Work and Services contained in this Agreement. If access cannot be provided, JCI's obligations under this Agreement, including without limitation the Substantial Completion Date, will be suspended until such access is provided. Suspension of JCI's duties hereunder will not cancel or suspend any of the City of Little Rock's obligations under this Agreement unless the denial of access was caused by events beyond the control of the City of Little Rock. 5. CERTIFICATE OF SUBSTANTIAL COMPLETION. The Certificate of Substantial Completion to be executed by the Customer shall include: a. an acknowledgement by the Customer of the improvements substantially completed and the Substantial Completion Date for each Improvement; b. an acknowledgment by the Customer of receipt of manuals and training provided by JCI under the Agreement; c. an acknowledgement by the Customer of the warranty start date and warranty period; d. a punchlist of items remaining to be completed by JCI. [PAGE 5 of 391 1 6. PERFORMANCE AND PAYMENT BONDS. JCI shall execute performance and payment bonds with 2 sureties acceptable to the City of Little Rock. Bonds shall be executed to the City of Little Rock for the 3 faithful performance and fulfillment of the installation of improvements and to include the protection 4 of the City of Little Rock from all liens and damages arising out of the work, and for the payment of all 5 labor and materials used in the work and the protection of the City of Little Rock from all liens and 6 damages arising therefrom. The performance and payment bonds shall be single multi -year bonds in 7 the amount equal to one hundred percent (100 %) of the investment of the improvements in the 8 facilities. In addition, JCI shall provide to the City of Little Rock a single multi -year bond for 100% of 9 the aggregate guaranteed savings over the agreed -upon term of financing. Multiple single -year bonds 10 shall not be acceptable. 11 7. TAXES, PERMITS, AND FEES. Except as specified herein, JCI shall be responsible for obtaining all 12 permits and related permit fees associated with the Work and Services. JCI shall pay sales, 13 consumer, use, and other similar taxes and shall secure and pay for the building permit and other 14 permits and governmental fees, licenses, and inspections necessary for proper execution. The 15 Customer shall be responsible for securing any necessary approvals, assessments, or zoning changes 16 and shall be responsible for real estate and personal property taxes where applicable. JCI makes 17 no representations regarding the tax implications or Customer's accounting treatment of this 18 Agreement. 19 8. WARRANTY. JCI warrants that materials and equipment furnished by JCI will be of good quality 20 and new; that the Work will be free from defects; and that the Work and Services will conform to 21 the requirements of the Agreement Documents. JCI warrants that the Work shall be free from 22 defects in material and workmanship arising from normal usage for a period of one year from the 23 Substantial Completion Date and that its Services will be free from defects in workmanship, design, 24 and material until the end of the Term, or for one year, whichever is earlier. Upon written notice 25 from the Customer, JCI shall, at its option, repair or replace the defective Work or re- perform 26 defective Services. These warranties do not extend to any Work or Services that have been 27 abused, altered, misused, or repaired by the Customer or third parties without the supervision of 28 and prior written approval of JCI; or if JCI serial numbers or warranty date decals have been 29 removed or altered. 30 31 THESE WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING 32 BUT NOT LIMITED TO THOSE OF MERCHANTABILITY AND FITNESS FOR A SPECIFIC PURPOSE. 33 34 Customer understands that JCI is a provider of services under this Agreement. JCI shall not be 35 considered a merchant or a vendor of goods. If JCI installs or furnishes a piece of equipment under 36 this Agreement, and that equipment is covered by a warranty from the manufacturer, JCI will 37 transfer the benefits of that manufacturer's warranty to Customer if this Agreement with Customer 38 terminates before the equipment manufacturer's warranty expires. 39 9. CLEANUP. JCI shall keep the premises and the surrounding area free from accumulation of waste 40 materials or rubbish caused by the Work and, upon completion of the Work, JCI shall remove all 41 waste materials, rubbish, tools, construction equipment, machinery, and surplus materials. 42 10. SAFETY. JCI shall be responsible for initiating, maintaining, and supervising all safety precautions 43 and programs in connection with the performance of the Work or Services. JCI shall comply with 44 all applicable laws, ordinances, rules, regulations, and lawful orders of public authorities related 45 to safety of persons or property. 46 11. HAZARDOUS WASTE. Unless specifically noted in Schedule 1, JCI's obligations expressly exclude 47 any Work or Services of any nature associated or connected with the identification, abatement, 48 cleanup, control, removal, or disposal of hazardous wastes or substances, including but not limited 49 to asbestos, lead or PCBs, in or on the premises in which JCI will be required to perform Work. 50 [PAGE 6 of 391 1 12. LANDFILL CONCERNS. The Work includes the placement of methane recovery wells in a Landfill. 2 During the operation of the Landfill, Customer has implemented a Hazardous Waste Exclusion Plan 3 for the Landfill, which includes procedures to minimize receipt and disposal of various hazardous 4 wastes in the Landfill. Customer has also maintained an Asbestos Management Plan, which requires 5 recording where asbestos has been placed in the Landfill in relation to an onsite survey control 6 system. The onsite survey control system was initially created during construction for as -built 7 surveys of waste cells and for recording the position of any asbestos or special waste materials 8 placed in the Landfill. JCI and its subcontractors will be placing the methane recovery wells 9 relying on information supplied to it by Customer regarding the construction of the waste cells, the 10 location of the cell components, such as liners, and the location of asbestos or special waste, as 11 well as on the belief that the Hazardous Waste Exclusion Plan has successfully prevented the 12 introduction of such waste into the Landfill. JCI and its subcontractors shall not be liable for any 13 damage or injuries occurring during the placement of methane recovery wells in the landfill to the 14 extent resulting from (a) any inaccuracies in information concerning the survey system, as- bunts, 15 asbestos placement, or special waste placement, or (b) any failure of the Hazardous Waste 16 Exclusion Plan to prevent the introduction of such wastes into the Landfill. 17 13. INSURANCE. Prior to commencing the Work, JCI shall provide a certificate of insurance with 18 Contractor showing its insurance coverage's and naming the City of Little Rock as an additional 19 insured with respect to liability arising out of operations performed for the City by or on behalf of 20 JCI to the extent of damages directly caused by the negligence of JCI.JCI shall maintain such 21 insurance in full force and effect at all times until the Work and Services have been completed, in 22 the following minimum amounts: COVERAGES Workmen's Compensation Insurance or self insurance, including Employer's Liability Comprehensive General Liability Insurance, including Contractual Comprehensive Automobile Liability Insurance LIMITS OF LIABILITY Statutory $5,000,000 One Occurrence, $5,000,000 aggregate for Bodily Injury Liability and $5,000,000 each occurrence for Property Damage Liability. In addition, Comprehensive General Liability Insurance shall include coverage for Personal Injury Liability, including employment related suits. $5,000,000 Each Aggregate. In addition, JCI shall procure and maintain in effect during the life of this Agreement Comprehensive No -Fault Automobile Liability Insurance with residual limits of $5,000,000 aggregate for Bodily Injury and Property Damage Liability. Such coverage is to include Employers Non -Owed and Hired Car Liability and is to cover all vehicles owned, leased, operated by or for or on behalf of JCI. $5,000,000 Combined Single Limit The above limits are obtained through primary and excess policies. Certificates of Insurance PAGE 7 OF 391 acceptable to Customer shall be filed with Customer prior to commencement of the work. These certificates and the insurance policies required by this Agreement shall contain provisions that coverages afforded under the policies will not be canceled or allowed to expire until at least thirty (30) days' prior written notice has been given to Customer. 2 14. RISK ALLOCATION AND INDEMNITY. 4 (a) The Customer assumes all risk and liability for the use, operation, and storage of the 5 Equipment, and for injuries or death to persons or damage to property arising out of the use, 6 operation, or storage of the Equipment, except for any injuries or death to persons or damage 7 to property caused by the negligence of JCI, it employees, agents or assigns. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 JCI shall indemnify and hold harmless the Customer, its employees, agents, and assigns against all claims, actions, damages, liabilities, and expenses, including attorney's fees, arising out of or related to any claims of patent infringement and any claims of construction or materialman's lien made by any subcontractor or materialman. JCI shall also indemnify and hold harmless the Customer, its employees, agents, and assigns against all claims, actions, damages, liabilities and expense, including attorney's fees, arising out of or related to personal injury or property damage to the extent caused by JCI's negligence or willful misconduct in connection with the performance of the Work. JCI and the Customer agree that JCI shall be responsible only for such injury, loss, or damage caused by the intentional misconduct or the negligence act or omission of JCI. The obligations of JCI and of the Customer under this paragraph are further subject to paragraph 3 and 12 below. (b) To the extent not specifically provided for in other sections of this Agreement, JCI will indemnify and hold harmless the Customer, its employees, agents, and assigns against all special, indirect, or consequential damages resulting from the negligent or willful misconduct of JCI, its employees, agents, or assigns in performance of the Work or Services. JCI's indemnity obligations under subsection (b) will be limited to $1 million dollars in the aggregate. (c) JCI's obligations under subsection (b) will be for a term of three (3) years from the date of substantial completion, with options to renew and /or amend for additional terms over the duration of the term of this Agreement. (d) Notwithstanding anything set forth in this Agreement, the parties understand and agree that the City shall not waive its tort immunity expressed in Ark. Code Ann. Sec. 21 -9 -301. 15. LIABILITY. If this Agreement covers fire safety or security equipment, the Customer understands that JCI is not an insurer regarding those services. JCI shall not be responsible for any damage or loss that may result from fire safety or security equipment that fails to perform properly or fails to prevent a casualty loss. JCI is also not responsible for any injury, loss, or damage caused by equipment that is not Covered Equipment, as defined in Schedule 3. However, JCI shall be responsible for any and all injury, loss, or damage to non - covered equipment caused by Covered Equipment. 16. JCI'S PROPERTY. All materials deemed proprietary by JCI and furnished by and used by JCI personnel and JCI authorized subcontractors or agents at the installation site, including documentation, schematics, test equipment, software, and associated media remain the exclusive property of JCI. The Customer agrees not to use such proprietary materials for any purpose at any time without the express written approval of JCI. The Customer agrees to allow JCI personnel and JCI authorized subcontractors or agents to retrieve and to remove all such proprietary materials remaining after installation of the LFG system and maintenance operations have been completed. The Customer acknowledges that all JCI software included is proprietary and will be delivered only [PAGE 8 of 391 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 under the provisions of an appropriate Software License Agreement that will limit its use to the system purchased under this Agreement. 17. MODIFICATIONS. Additions, deletions, and modifications to this Agreement, Exhibits and Schedules may be made upon the mutual agreement of the parties in writing. The parties contemplate that such modifications may include but are not limited to the installation of additional improvement measures, energy conservation measures, facility improvement measures, and operational efficiency improvements or furnishing of additional work and services within the identified facilities, as well as other facilities owned or operated by the Customer. These modifications may take the form of additional phases of work or modifications to the original scope of Work or Services. 18. NOTICES. All notices or communications related to this Agreement shall be in writing and shall be deemed served if and when sent by facsimile or mailed by certified or registered mail to JCI at the address listed on page 1 of this Agreement and to JCI, ATTN: General Counsel - Controls, 507 East Michigan Street, Milwaukee, Wisconsin, 53202, and to Customer at the address listed on page 1 of this Agreement. 19. RATIFICATION. To the extent that JCI has actually performed work and services under this Agreement after the start date of the Agreement but prior to the signing of this Agreement by the parties, the work and services are hereby ratified by both parties and shall be compensated in accordance with the terms and conditions of this Agreement. 20. NON- APPROPRIATION OF FUNDS. This Agreement shall terminate without penalty at such time as appropriated funds are not available to satisfy the obligations of the City of Little Rock hereunder. The failure of the City of Little Rock to make an appropriation in any given year shall not be deemed a breach of this Agreement, nor give rise to any cause of action by JCI for legal or equitable relief. The City of Little Rock shall, to the extent possible, give JCI written notice thirty (30) calendar days prior to such termination. 21. TERMINATION FOR CONVENIENCE. Upon thirty (30) calendar days' written notice to JCI, this Agreement may be terminated by the City of Little Rock without penalty in accordance with this clause in whole, or from time to time in part, whenever the City of Little Rock determines, in its sole discretion, that such termination is in the best interest of the City. In the event of such termination, the City of Little Rock will pay all reasonable costs associated with this Agreement that JCI has incurred up to the date of termination; provided, however, that JCI shall not be reimbursed for any anticipatory profits that have not been earned up to the date of termination. 38 39 22. TRADE NAMES AND PATENT. Whenever an article of any class or materials or equipment is 40 specified by the trade name of any particular patentee, manufacturer, or dealer, or by reference 41 to the catalog of any such manufacturer, or dealer, it shall be taken to mean and specify the 42 articles or materials described or equal thereto in quality, finish and durability and equally as 43 serviceable for the purpose for which it is or they are intended. The City of Little Rock shall make 44 the decision as to whether the material or equipment offered is equal to those specified and the 45 decision of the City of Little Rock shall be final. 46 23. PATENT AND PATENT RIGHTS. JCI shall protect and save the City of Little Rock harmless against 47 all claims and actions brought against the City of Little Rock by reason of any actual infringement 48 upon patent rights in any material, process, machine or appliance used by JCI in the work. 49 24. LABOR LAWS AND ORDINANCES. JCI shall obey and abide by all the laws of the State of Arkansas 50 relating to the employment of labor and public work, and all ordinances and requirements of the 51 City of Little Rock regulating or applying to public improvements. 52 JCI agrees not to discriminate against any employee or applicant for employment, to be employed 53 in the performance of this Agreement, with respect to hire, tenure, terms, conditions or privileges [PAGE 9 of 391 I of employment, or any matter directly or indirectly related to employment, because of age, sex, 2 race, color, religion, national origin, or ancestry. JCI further agrees that every subcontract entered 3 into for the performance of this Agreement will contain provisions requiring nondiscrimination in 4 employment, as herein specified, binding each Subcontractor. Breach of this covenant may be 5 regarded as a material breach of this Agreement. 6 25. ASSIGNMENT OR SUBLETTING OF CONTRACT. 7 JCI shall obtain prior approval from the City of Little Rock before contracting with, or otherwise 8 hiring, any subcontractors to perform any portion of the work under this Agreement. 9 JCI shall be fully responsible to the City of Little Rock for the acts and omissions of JCI's 10 subcontractors and of persons either directly or indirectly employed by the subcontractors, as JCI is 11 for the acts and omissions of persons directly employed by JCI. 12 All subcontractors and material suppliers utilized on this project shall be experienced in the type 13 of work required by the project, reputable, qualified and shall be acceptable by the City of Little 14 Rock. JCI shall not award work to subcontractor(s) without prior written approval of the City of 15 Little Rock. 16 Nothing contained in this Agreement will create any contractual relationship between any 17 subcontractor or material supplier and the City of Little Rock. 18 Materials, supplies or equipment to be incorporated into the work shall not be purchased by JCI, or 19 any subcontractor or material supplier, subject to a chattel mortgage or under a conditional sales 20 contract or other agreement by which an interest is retained by the seller. 21 JCI shall ensure that the City of Little Rock receives lien waivers from all subcontractors and 22 material suppliers before work begins on the project. JCI shall give prior written notice to the 23 subcontractors and material suppliers providing work and materials on the project that states the 24 following: "According to Arkansas law, it is understood that no liens can be filed against public 25 property if a valid and enforceable payments and performance bond is in place. Regarding this 26 Project and Agreement, the valid and enforceable bonds are with SAFECO." JCI shall have each 27 subcontractor and material supplier execute a written receipt evidencing acknowledgment of this 28 statement. 29 26. COMPLIANCE WITH LAW AND STANDARD PRACTICES. JCI shall perform its obligations herein in 30 compliance with any and all applicable federal, state, and local laws, rules and regulations, 31 including applicable licensing requirements, in accordance with sound engineering and safety 32 practices, and in compliance with any and all reasonable rules of the City of Little Rock, Arkansas 33 relative to the Premises and the work performed pursuant to this Agreement. JCI shall be 34 responsible for obtaining all governmental permits, consents, and authorizations as may be 35 required to perform its obligations herein. 36 27. KEY PERSONNEL. Key personnel assigned to this project by JCI and its subcontractors shall not be 37 removed from this project without the prior written approval of the City of Little Rock. Such 38 approval may not be unreasonably withheld. 39 28. REPRESENTATIONS AND WARRANTIES OF JCI. JCI represents and warrants as follows: 40 a) JCI is familiar with all applicable laws and regulations pertaining to the Agreement. 41 b) JCI is duly organized, validly existing, presently in good standing and having all 42 necessary powers to enter into this Agreement and to do business in the State of 43 Arkansas. [PAGE 10 OF 391 c) There is no pending or threatened labor dispute, strike or work stoppage affecting JCI's business. 3 d) There is no suit, action, arbitration or legal, administrative, or other proceeding 4 pending, or to the best knowledge of JCI, threatened against JCI that would affect or 5 impair the performance of JCI under this Agreement. 6 e) JCI has obtained, or will obtain, all registrations, licenses, certificates of inspection, 7 reports, or other clearances required to be obtained of any governmental or other 8 agency, in order to enable it to fully perform the terms of this Agreement. 9 f) JCI has the right, power, legal capacity and authority to enter into and perform all its 10 obligations under this Agreement and no approval or consent of any person other than 11 that JCI is necessary to effect the execution and performance of this Agreement by JCI. 12 g) There are no other circumstances which would adversely affect JCI's ability to execute 13 this Agreement and fully perform its obligations herein. 14 h) The information contained in all documents, lists, policies and other writings furnished, 15 or to be furnished, to the City of Little Rock by, or on behalf of JCI is true and 16 accurate, and does not fail to include any statement of a material fact, the omission of 17 which would be misleading. 18 i) None of the representations or warranties made by JCI, or made in any certificate or 19 memorandum furnished, or to be furnished, to the City of Little Rock by, or on behalf 20 of JCI, contains or will contain any untrue statement of a material fact, or omit any 21 material fact, the omission of which would be misleading. 22 JCI shall, at JCI's sole cost and expense, provide the City of Little Rock with such evidence of the 23 accuracy of any and all representations and warranties herein contained as the City of Little Rock 24 may require. JCI shall, at JCI's sole cost and expense, provide the City of Little Rock with such 25 other evidence of JCI's compliance with the terms of this Agreement as the City of Little Rock may 26 require. 27 29. ADDITIONAL TERMS. 28 29 A. Any failure of JCI or the City of Little Rock to require strict performance by JCI or the City of 30 Little Rock, or any waiver by JCI or the City of Little Rock of any requirement under this 31 Agreement, does not consent to or waive any subsequent failure or breach by JCI or the City of 32 Little Rock. 33 34 B. In the event any section, subsection, subdivision, paragraph, subparagraph, item, sentence, 35 clause, phrase, or word of this Agreement is declared or adjudged to be invalid or 36 unconstitutional, such declaration or adjudication shall not affect the remaining provisions of 37 the Agreement, as if such invalid or unconstitutional provision was not originally a part of the 38 Agreement. 39 40 C. The captions and titles in this Agreement are for convenience only and shall not affect the 41 interpretation or meaning of this Agreement. 42 43 D. This Agreement is the full Agreement between JCI and the Customer as of the date it is signed. 44 All previous conversations, correspondence, agreements, or representations related to this 45 Agreement (including any Project Development Agreement) are not part of the Agreement 46 between JCI and the Customer and are superseded by this Agreement. No modifications are 47 binding unless made in writing and signed by both parties. 48 [PAGE 11 OF 391 1 E. This Agreement shall be construed in accordance with the laws of the state of the principal 2 place of Business of the Customer at the time of the execution of this Agreement, namely the 3 State of Arkansas. The venue shall be Pulaski County, Arkansas. For the term of this 4 Agreement, JCI will be available to the City of Little Rock for consultation, as a witness in any 5 trial or administrative matter, or as otherwise needed, pursuant to the terms of the Agreement 6 and subsequent addenda, approved by both parties in writing, and made a part of this 7 Agreement. 8 9 F. All reports, information, findings and other work products of JCI done pursuant to this 10 Agreement are not proprietary. Any methodology employed by JCI which was not created 11 because of this Agreement may be deemed proprietary and shall remain confidential, to the 12 extent permissible under Arkansas law, unless specific prior written approval for disclosure of 13 such information otherwise is given by JCI, or until such information is made public by the City 14 of Little Rock. JCI shall not own, possess, declare, or claim a copyright in or for any 15 information, material, drafts, writings, documents, or drawings of any nature whatsoever 16 produced pursuant to this Agreement. The parties expressly agree that the copyright to any 17 material produced pursuant to this Agreement is the exclusive right of the City of Little Rock. 18 19 G. JCI shall take all reasonable precautions to safeguard all City of Little Rock property entrusted 20 to JCI's custody or control. 21 22 H. JCI agrees to comply with the Arkansas Freedom of Information Act regarding disclosure of 23 records created under this Agreement that are subject to disclosure under that act. Such 24 records include, but are not limited to, the work product, memoranda and letters created for 25 this Agreement. 26 27 I. JCI agrees to comply with all applicable federal, state and local laws, regulations, and 28 ordinances and to require such compliance in contractual agreements with subcontractors. JCI 29 further agrees to comply with the requirements of the Americans with Disabilities Act and the 30 Equal Employment Opportunity Act, and regulations promulgated thereunder, and to require 31 such compliance in contractual agreements with subcontractors. 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 J. The officials who executed this Agreement hereby represent and warrant that they have full and complete authority to act on behalf of the City of Little Rock and JCI, and that by their signatures below, the terms and provisions hereof, constitute valid and enforceable obligations of each. K. This Agreement shall be executed in the original, and any number of executed copies. Any copy of this Agreement so executed shall be deemed an original and shall be deemed authentic for any other use. L. The terms of this Agreement shall be binding upon the parties hereto, their respective heirs, executors, administrators, successors and assignees. M. It is expressly agreed that JCI is acting as an independent contractor in performing the services specified herein. The City of Little Rock shall carry no workers' compensation insurance, health or accident insurance to cover JCI or JCI's employees for any type of loss which might result to JCI or JCI's employees in connection with the performance of the services set forth in this Agreement. The City of Little Rock shall not pay any contribution to Social Security, unemployment insurance, federal or state withholding taxes, nor provide any other contributions or benefits which might otherwise be expected in an employer- employee relationship, it being specifically agreed that JCI is not acting herein as an employee of City of Little Rock, but shall, at all times, and in all respects, have the rights and liabilities of an independent contractor. Dated 2006 [PAGE 12 OF 391 I CITY OF LITTLE ROCK, ARKANSAS 2 3 Signature: 4 5 Printed Name: Bruce Moore 6 7 Title: City Manager 8 9 10 11 12 13 14 15 16 17 Approved as to Legal Form: Thomas M. Carpenter City Attorney By: Beth Blevins Carpenter Deputy City Attorney JOHNSON CONTROLS, INC. Signature: Printed Name: Richard L. Harvey Title: South Region Solutions Manager [PAGE 13 OF 39] 1 Schedule 1 2 3 SCOPE OF WORK SCHEDULE 4 5 6 1. SUMMARY OF WORK: The following summarizes the Work to be provided by JCI under this 7 Agreement, as further defined below: 8 9 Landfill Gas -to- Energy Project -- City of Little Rock - Solid Waste Division Landfill Operation 10 Located on Ironton Cutoff Road in Little Rock, Arkansas 11 12 Johnson Controls, Inc. shall provide the City of Little Rock with the following services in conjunction 13 with the Landfill Gas- to- Energy Project, as per the conceptual system layout in Exhibit A, attached 14 hereto and made part of this Agreement. Work shall include all engineering, design, supervision and 15 installation labor, equipment and materials for a fully functional landfill gas ( "LFG ") collection system 16 for cells 1 and 2 of the Landfill, landfill gas flare station, dehydration and compression system, and 17 transmission system to 3rd party end -user and purchaser of LFG. The Project includes providing the 18 materials and equipment necessary for LFG data monitoring for billing purposes for the sale of the 19 landfill gas to the end user, as well as monitoring the system's performance, uptime and operability 20 from a remote location 24 hours a day, 7 days a week. All work shall be performed in accordance with 21 the facility permit, such permit to be obtained under this Scope of Work, Arkansas solid waste 22 regulations and applicable state and local laws, codes and regulations. 23 24 Professional Engineering, Design £t Permitting Assistance 25 The following services shall be provided: 26 1. Aerial and Land Survey. 27 2. Engineering and Design of the collection system, landfill gas flare station, dehydration and 28 compression system, and transmission system. 29 3. Preparation of permit application documents and assistance to the City of Little Rock in securing 30 permits for: 31 a. Arkansas Department of Environmental Quality Revised Solid Waste Permit for the LFG 32 collection and transmission system. 33 b. Arkansas Department of Environmental Quality Modified Air Permit &t Construction Permit to 34 include the LFG collection and transmission system. 35 c. Arkansas Department of Environmental Quality Construction Storm Water Permit for the 36 construction of the LFG collection and transmission system. 37 d. Right -of -Way Permit to cross Texas Eastern Natural Gas Pipeline. 38 e. Right -of -Way Permit to cross Arkansas State Highway (367 - Arch, or 338 - Dixon) from the 39 Arkansas Highway and Transportation Department. 40 f. Right -of -Way Permit from Pulaski County to cross Ironton Cutoff Road. 41 g. Land Title Search and Acquire Right -of -Way access for the gas transmission pipeline 42 between the City of Little Rock and the LFG end - user /purchaser, as required. 43 4. Customer and agency consultations in connection with securing above referenced permits and right - 44 of -ways. 45 5. Construction Specification Documents, including Plans and Specifications, for the LFG collection 46 and transmission system sealed by an Arkansas Registered Professional Engineer. All drawings will 47 be prepared using AutoCAD Rel. 2004 and Land Desktop Design Software. Construction 48 Specifications will be in CSI format on MS Word. [PAGE 14 of 391 1 6. Facilitation of pre- construction and construction meetings, as required. 2 7. Oversee and conduct startup of the collection system and transmission system, including required 3 regulatory compliance documentation. 4 5 Construction of Collection and Flare System at the Landfill 6 1. Provide and install 6 -10 inch transmission header pipeline system around the landfill, as per layout 7 in Exhibit A. 8 2. Provide and install 500 SCFM blower (20 psi) and refrigeration skid at location noted in Exhibit A. 9 3. Provide and install Utility Flare and Skid equipment at location noted in Exhibit A. 10 4. Design, provide and install complete new electrical power service, with power transformer and 11 meter. 12 5. Provide and install complete fenced enclosure of collection, flare, and compressor and dehydration 13 system. Enclosure will have heavy duty anti - collision poles at vehicle barrier points of enclosure. 14 6. Provide and install required night -time lighting for entire LFG system area. 15 7. Provide and install LFG collection system condensate to be conveyed to the existing onsite leachate 16 transmission system at the Landfill. 17 8. Provide and install ten (10) new LFG collection wells for cells 1 and 2. 18 9. Provide Construction Quality Assurance documentation for the installed LFG collection and 19 transmission system. 20 Header being provided under this project shall be sized to collect LFG from cell number four (4) , but 21 does not include the incremental costs with tying cell number four (4) or other additional cells (other 22 than Cells 1 & 2) into the header. 23 24 Construction of Transmission Pipeline 25 1. Provide and install 8 -inch pipeline at depths as needed, but not less than 3 feet, from City of Little 26 Rock Landfill to the LFG end - user's property line. 27 2. Coordinate system start up and acceptance of LFG by end -user. 28 29 Monitoring and Reporting of LF Gas for LFG End -User 30 1. Monitor LFG for CH4 (MMBtu) values on a continuous real -time basis. 31 2. Collect and store SUM and MMBtu data of LFG burned at the flare station. 32 3. Provide and install system that shall provide 24 hours a day / 7 days a week continuous monitoring 33 of installed system from remote location. 34 4. Monitoring system shall provide for off -site data storage, data review/ retrieval via web based 35 server. 36 5. Provide and install communications system for monitoring system. 37 38 Monitoring of Collection and Transmission System 39 1. Provide capability for alarm notification of collection and transmission system abnormalities or 40 unplanned shutdown to remote operations center for local JCI mechanical /technical on -site service 41 response and repair. 42 2. Provide call -out alarm messaging to appropriate JCI personnel when LFG operational parameters 43 are breached. [PAGE 15 of 391 1 3. Monitor LFG for CH4 (MMBtu), CO2 and NMOC levels on a continuous basis. 2 4. Collect and store SCFM and MMBtu data of LFG burned at the flare station. 3 5. Provide capability for 24 hours a day / 7 days a week monitoring of system and off -site data storage 4 (via web based server) as set forth above. 5 6 LFG Billing Information Collection and Reporting 7 1. Set up and coordinate with remote services to generate LFG utility invoices at applicable monthly 8 billing rate for City of Little Rock, per volume and MMBtu of gas delivered, to issue to end - 9 user /purchaser, and to provide the monthly HHV value of the LFG volume delivered for that month. 10 11 2. Provide to the City and to the end - user /purchaser, by November 15th of each calendar year, a 12 forecast of the LFG volume that is expected to be available for sale for the coming calendar year. 13 3. Provide to the City, by January 301h of each calendar year, the total amount of LFG that was burned 14 at the flare station for the previous calendar year, and the flared amount of LFG as a percentage of 15 the total produced for the previous calendar year. 16 17 End -User LFG Purchase Agreement 18 1. Assist City of Little Rock in negotiating the final Utility Purchase Agreement with Geo Specialty 19 Chemical. A copy of the executed Utility Purchase Agreement is attached hereto and incorporated 20 herein as Exhibit D of this Agreement. 21 22 Responsibilities of the City of Little Rock 23 1. Permitting Applications as required by the applicable regulatory agencies must be requested by the 24 City of Little Rock, as owner. The scope of work and pricing set forth in this Agreement includes 25 the preparation and the fees associated with the required permit applications, as specified herein. 26 To Be Provided by the City of Little Rock 27 1. Provide backfill material (i.e., general fill, clay, topsoil) for LFG header piping and Transmission 28 piping. JCI shall be responsible for picking up and transporting required fill to the point of use. 29 2. Provide water for construction purposes. 30 Exclusions 31 1. Patching of asphalt road within City of Little Rock's Landfill property lines. 32 2. Scope of Work - "Old" Landfill Site 33 Under the scope of this Agreement, JCI shall ensure that FTN Associates, as subcontractor to JCI, 34 assist the City of Little Rock in the development and submission of the required documentation to 35 the Air Division of the Arkansas Department of Environmental Quality ( "ADEQ ") to request and 36 obtain exemption for this portion (designated "Old Landfill ") of the site from active collection and 37 control. Based upon a meeting held at ADEQ on May 22, 2006, it is anticipated that the Old Landfill 38 site will not require any capital outlay for equipment and systems necessary for collection and 39 control. Therefore, no additional costs are included within the scope of this Agreement to install 40 any equipment for the Old Landfill portion of the Landfill site. The Scope of Work and price 41 contained herein includes surface methane monitoring for the entire Landfill site, including the 42 Old Landfill portion of the site. 43 44 45 Dated ,2006 46 47 48 49 [PAGE 16 of 391 5 6 7 8 9 10 11 12 13 14 15 16 17 18 CITY OF LITTLE ROCK, ARKANSAS Signature: Printed Name: Bruce Moore Title: City Manager Approved as to Legal Form: Thomas M. Carpenter City Attorney By: Beth Blevins Carpenter Deputy City Attorney JOHNSON CONTROLS, INC. Signature: Printed Name: Richard L. Harvey Title: South Region Solutions Manager PAGE 17 OF 391 1 2 3 4 5 6 7 8 Schedule 2 ASSURED PERFORMANCE GUARANTEE SCHEDULE 1. DEFINITIONS. The following terms are defined for purposes of this Schedule as follows: Project Benefits are the Measured Billable Usage that occurs in the Guarantee Term. Annual Guaranteed Project Benefits are the portion of the Total Guaranteed Project Benefits to be achieved in any one year of the Guarantee Term, calculated and adjusted as set forth in this Schedule. 9 Annual Project Benefits are the Project Benefits achieved for any one year of this Agreement. 10 Project Benefits Surplus is the amount by which the Annual Project Benefits that exceed the 11 Annual Guaranteed Project Benefits in any one -year of the Guarantee Term. 12 Project Benefits Shortfall is the amount by which the Annual Guaranteed Project Benefits exceeds 13 the Annual Project Benefits in any one -year of the Guarantee Term. 14 Guarantee Term is the term of this Assured Performance Guarantee. As outlined in paragraph 2 of 15 this Agreement, the Guarantee Term shall coincide with the term of Services and shall be 180 16 months from the Substantial Completion Date, unless terminated earlier. 17 Installation Period means the period between the Commencement Date and the first day of the 18 month following the Substantial Completion Date. For purposes of the annual reconciliation, 19 Project Benefits achieved during the Installation Period shall be considered Project Benefits 20 achieved during the first year of the Guarantee Term. 21 Measured Project Benefits are achieved and calculated as set forth in paragraph 3, Reconciliation, 22 of this Schedule. 23 Total Guaranteed Project Benefits are the Total Guaranteed Project Benefits to be achieved 24 during the entire Guarantee Term, calculated and adjusted as set forth in this Schedule. 25 26 Total Project Benefits are the Project Benefits achieved during the entire term of this Agreement. 27 Equipment is the product(s) installed by JCI, its subcontractors or its agents as outlined in 28 Schedule 1 (Scope of Work). 29 Service is the scope of work provided by JCI, its subcontractors or its agents as outlined in 30 Schedule 3 (Service Schedule). 31 Baseline is the mutually agreed upon calculated figures or usage amounts that reflect existing 32 conditions and assumptions as set forth in Schedule 2, Exhibit 6. 33 2. GUARANTEE. Subject to the terms and conditions of this Agreement, JCI guarantees that the 34 Customer, at a minimum, will achieve $6,001,083.00 (Six million, one thousand, eighty three 35 dollars and no cents) of Total Guarantee Project Benefits during the Term of the Agreement to 36 offset construction and operation costs of the installed system as detailed in Schedule 2, Exhibit 5. 37 3. RECONCILIATION. The frequency and the methods of reconciliation to be used during the 38 Guarantee Term have been approved by the Customer at the time that this Agreement was 39 executed and are defined in the Exhibits attached to this Schedule. Except by mutual agreement of 40 the parties, no changes to the frequency or methods of reconciliation may be made during the 41 Guarantee Term. 42 4. CHANGES IN USE. The Customer agrees to notify JCI, within five (5) business days, of any actual 43 change, whether before or during the Guarantee Term, in the use of any facility or equipment to [PAGE 18 OF 391 I which this Schedule applies relative to this LFG project, or of any other condition arising before or 2 during the Guarantee Term, that reasonably could be expected to change the amount of Project 3 Benefits to which this Schedule applies relative to this LFG project. Such changes or conditions are 4 as follows: changes in the primary use of any facility; changes to the hours of operation of any 5 facility; changes or modifications to the Equipment or Services provided under this Agreement; 6 failure of the premises to meet local building codes; changes in utility suppliers, method of utility 7 billing, or method of utility purchasing; improper maintenance of the Equipment or of any related 8 equipment other than by JCI; changes to the equipment or to any facility required by changes to 9 local building codes; or additions or deletions of equipment at any facility. Such a change or 10 condition need not be identified in the Base Line in order to permit JCI to make an adjustment. 11 Upon receipt of such notice, or if JCI independently learns of any such change or condition, JCI 12 shall calculate and send to the Customer, for the Customer's review and written approval, a notice 13 of adjustment to the Base Line to reflect the impact of such change or condition, and the 14 adjustment shall become effective as of the date that the change or condition first arose. Should 15 the Customer fail to provide JCI with notice of any such change or condition, JCI may make 16 reasonable estimates as to the impact of such change or condition and as to the date on which such 17 change or condition first arose in calculating the impact of such change or condition. JCI shall 18 provide the written estimates to the City of Little Rock for the City of Little Rock's review and 19 approval of same. 20 5. PROJECT BENEFIT SURPLUSES OR SHORTFALLS. If the Annual Project Benefits during a specific 21 year of the Guarantee Term, plus amounts credited from surpluses in the Installation Period and 22 earlier years of the Guarantee Term, are less than the Annual Guaranteed Project Benefits for that 23 year, JCI may apply the difference against any unpaid balances from the Customer then existing 24 under the Agreement. Upon the mutual written agreement of the parties, JCI may also provide 25 additional products or services, in the value of the shortfall, at no additional cost to the Customer. 26 Where Project Benefit shortfalls have occurred, JCI reserves the right, subject to the prior written 27 approval of the Customer, which shall not be unreasonably withheld, to implement additional 28 operational improvements at no cost to the Customer, that will generate additional Project 29 Benefits in future years of the Guarantee Term. JCI may credit, in whole or in part, any Project 30 Benefit Surplus from the previous two consecutive years of the Guarantee Term toward the 31 reconciliation of the Annual Guaranteed Project Benefits for the current year of the Guarantee 32 Term. 33 The following Exhibits are attached and made part of this Schedule: 34 Exhibit 1 Annual Reconciliation of Project Benefits - System Uptime Guarantee 35 Exhibit 2 Measurement and Verification of Project Benefits 36 Exhibit 3 Volume of Landfill Gas Available for Collection and Sale 37 Exhibit 4 Quality of Landfill Gas Available for Collection and Sale 38 Exhibit 5 Project Proforma 39 Exhibit 6 Responsibilities of JCI and Customer [PACE 19 of 391 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 Schedule 2 Exhibit 1 Annual Reconciliation of Project Benefits - System Uptime Guarantee Johnson Controls, Inc. guarantees that the system will be operational as per the table below for each year of the term of the Agreement as indicated. System referenced is collection of landfill gas from Cells 1 and 2 and transmission of the Landfill gas to the end - user /purchaser. CITY OF LITTLE ROCK, ARKANSAS Initials: JOHNSON CONTROLS, INC. Initials: [PAGE 20 OF 391 Percentage/ System Uptime / Year Hours per Year - System Uptime Installation 0% 0 Year1 95% 8322 Year 95% 8322 Year 95% 8322 Year 95% 8322 Year 90% 7884 Year 95% 8322 Year 95% 8322 Year 95% 8322 Year 95% 8322 Year 10 90% 7884 Year11 95% 8322 Year12 95% 8322 Year13 95% 8322 Year 14 95% 8322 Year 15 90% 7884 CITY OF LITTLE ROCK, ARKANSAS Initials: JOHNSON CONTROLS, INC. Initials: [PAGE 20 OF 391 1 2 3 4 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 Schedule 2 Exhibit 2 Measurement and Verification of Project Benefits Project Benefit Calculations The total Project Benefits for a given time period will be determined by the equation below: 1) Project Benefits Calculation: Variables to be utilized: $ /MMbru = Minimum of the Floor Rate of $4.50 /MMbtu or the Average sale price per MMbtu of LFG for reporting time period ($ /MMBtu), whichever is greater. 550 = Base energy content of LFG (Btu /ft) 325 = Base yearly volumetric rate of LFG (scfm)` 8500 = Hours Operated (hrs /yr) - Measured 8322 = Guaranteed Hours Operated (G- hrs /yr)" * These constants change yearly - yearly values shown in Exhibits 1 and 3. Project Benefits = {[hrs /yr x scfm x 60 min /hr x Btu /ft3] / 106} x $ /MMBtu {[8,500 hrs /yr x 325 scfm x 60 min /hr x 550 Btu /ft3] /1061 x $4.50 /MMBtu Annual Guarantee = f[G- hrs /yr x scfm x 60 min /hr x Btu /ft3] / 106 x $ /MMBtu Project Benefits {[8,322 hrs /yr x 325 scfm x 60 min /hr x 550 Btu /ft3] /1061 x $4.50 /MMBtu Any shortfall cost amounts will be determined by utilizing the equation above. Miscellaneous Adjustments The various obligations and commitments undertaken by JCI in this Agreement are based in part on the assumption that Customer's Facilities are and will remain in full compliance with all applicable codes. The Customer agrees that all equipment of Customer will be maintained in proper operating condition, and all equipment of the Customer will be operated in accordance with the terms of this Agreement. In the event JCI determines or becomes aware that regulations or codes are not being adhered to, or that the Customer's equipment is not being maintained in proper operating condition, JCI shall be entitled to make such adjustments as may be necessary to the calculations used to determine the Project Benefits in order to reflect the effects of non - compliance or improper operating condition of Customer's equipment. CITY OF LITTLE ROCK, ARKANSAS Initials: JOHNSON CONTROLS, INC. Initials: [PAGE 21 OF 391 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Schedule 2 Exhibit 3 Volume of Landfill Gas Available for Collection and Sale The volume of LFG stated herein is based upon testing performed during the project development phase. For purposes of this schedule, projected volume of landfill gas available from Cells 1 and 2 has been calculated based upon the actual gas pump test performed at the site in December, 2005. However, except for the performance standards set forth in this Agreement, JCI is not responsible for the actual volume of gas available from the City of Little Rock's landfill, as the variables to guarantee the volume of LFG are beyond JCI's control. The volumes utilized to develop the financial model are based on the average of the moderate (70% collection) and conservative (60% collection) estimates as detailed below. The final volumes utilized in the financial model are based on a ( -25 %) Confidence Interval from the average collection rate established from the pump test data. Operating Parameters Parameter Value Units Hour per Year 8760 Hrs. Percent U time 95 Model scfm ) Annual U time Hours 8322 Hrs. Methane (CH4) Content 55 M Collection Eff. 60 651 ,Higher Collection Eff. 701 M CITY OF LITTLE ROCK, ARKANSAS JOHNSON CONTROLS, INC. Initials: Initials: [PAGE 22 OF 391 Year Cell 1 &2 60% Collection 70% Collection Average Collection Rate Collection Rate MMBtu/ r. Model scfm ) Efficiency (scfm) -25% Confidence Efficiency scfm) (scfm) 1 2007 930 558 651 604 453 124,442 2 2008 884 531 619 575 431 118,391 3 1 2009 841 505 589 547 410 112,605 4 2010 800 480 560 520 390 107,109 5 2011 761 457 533 495 371 96,538 6 2012 724 434 507 471 353 96,911 7 2013 689 413 482 448 336 92,186 8 1 2014 655 393 459 426 319 87,702 9 2015 623 374 436 405 304 83,411 10 2016 593 356 415 385 289 75,184 11 2017 564 338 395 366 275 75,480 12 2018 536 322 375 349 261 71,792 13 2019 1 510 1 306 1 357 1 332 1 249 68,296 14 2020 485 291 340 315 237 64,969 15 2021 462 277 323 300 225 58,558 15 Yr. Annual Average >>> 88,905 Years 5, 10 and 15 are at 90% u time: all other years at 95% u time CITY OF LITTLE ROCK, ARKANSAS JOHNSON CONTROLS, INC. Initials: Initials: [PAGE 22 OF 391 Schedule 2 Exhibit 4 Quality of Landfill Gas Available for Collection and Sale 5 The quality of LFG stated herein is based upon the gas pump test and analytical testing 6 performed in December, 2005 during the project development phase. For purposes of this 7 schedule, the quality of landfill gas available from Cells 1 and 2 has been calculated using the 8 analytical test data available as per Exhibit C herein. However, except for the performance 9 standards set forth in this Agreement, JCI is not responsible for the quality of the gas available 10 from the City of Little Rock's Landfill, as the variables to guarantee the quality of the gas are 11 beyond JCI's control. 12 13 City of Little Rock 14 Landfill Gas - Cells 1 and 2 15 Breakdown of Gas Compounds 16 March, 2006 Compound Amount Units Heating Value 450 to 550and not less than 365 (Btu /ft HHV Methane 45 to 55 M Hydrogen Sulfide (HZS) 5 to 50 (ppmv) Oxygen (OZ) 2 to 5 M Nitrogen (NA 5 to 10 M Carbon Monoxide (CO) 0.5 to 1 M Carbon Dioxide (COA 40 to 55 M Propane 0.003 M Water Vapor 6 to 8 (%) by volume 17 18 Heating Value of LFG. 19 Moisture will be removed from the LFG at the Landfill site. However, the HHV is specific to the 20 Methane compound of the LFG only. The LHV of Methane is the net heating value, which neglects 21 the energy in the water vapor formed by the combustion of hydrogen in Methane (CH4). The LHV of 22 Methane is roughly ninety percent (90 %) of the HHV. The HHV is always used by the Natural Gas 23 suppliers for billing purposes, and therefore will be used for LFG billing purposes. The HHV used for 24 billing purposes shall be the measured HHV adjusted to 14.65 psia and 60 degrees Fahrenheit. 25 26 This value will be determined by taking the end of month cumulative BTUs delivered and dividing 27 by the end of month cumulative volume of LFG delivered (Month ending MMBtus _ Month ending 28 MCF (thousand cubic feet). 29 30 Example calculation for one (1) month: 31 End of Month Btu /ft3 = 10,370 MMBtu / 20,740.3 MCF = 499.99 Btu /ft3 = month is within the 32 specification set forth in paragraph 4(c). 33 7,259 MMBtu / 20,740.3 MCF = 349.99 Btu /ft3 = month is out of the specification 34 set forth in paragraph 4(c). 35 36 37 38 39 40 41 42 43 The heating value of the LFG will be calculated each month as set forth above, and will be provided in the monthly invoice to the end - user /purchaser for the LFG. The percentage of the volume of LFG delivered each month that is below 450 Btu /ft3 will be included in the monthly invoice to the end - user /purchaser. CITY OF LITTLE ROCK, ARKANSAS Initials: JOHNSON CONTROLS, INC. Initials: [PAGE 23 of 39] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 Schedule 2 Exhibit 5 Project Proforma The project proforma is based upon the minimum quality and quantity of gas projected to be available from the City of Little Rock's Landfill, Cells 1 and 2, as detailed in Exhibits 1A and 1B. The annual quantity represented in the proforma is the annual average of the 15 year term total. Actual financial performance may vary dependent upon quantity and quality of the landfill gas available for use and sale. For purposes of this proforma, the invoicing for the sale of the LFG is based upon the Floor Rate of $4.50 + 25% of the difference between $4.50 (floor rate) and the Nymex Prompt Monthly Close Price for each month of the term of the Agreement. Below is the projected economic proforma that demonstrates the project's financial performance at both the floor rate and the NG futures rate after applying the pricing structure noted herein. Natural gas futures pricing information was obtained using data published by the EIA (Energy Information Association). CITY OF LITTLE ROCK, ARKANSAS Initials: JOHNSON CONTROLS, INC. Initials: [PACE 24 OF 391 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 Schedule 2 Exhibit 6 Responsibilities of JCI and Customer This Exhibit details the individual responsibilities of JCI and of the City of Little Rock, not otherwise set forth in this Agreement, in connection with the management and administration of the Assured Performance Guarantee. JCI: JCI is responsible for the maintenance, operation, repair, and system component replacement, data collection and monitoring of the systems installed as a result of this Agreement. These include Landfill Gas collection and flare, dehydration and compression, and transmission systems and auxiliary equipment not specifically listed, but installed as part of this Agreement. City of Little Rock: The City of Little Rock is responsible for operation, maintenance, repairs, and regulatory compliance issues as they pertain to all other operations, equipment and systems at the Landfill site. CITY OF LITTLE ROCK, ARKANSAS JOHNSON CONTROLS, INC. Initials: Initials: [PAGE 25 of 391 4 5 SERVICES SCHEDULE Schedule 3 Exhibit 1 6 1. SCOPE OF SERVICE. JCI and the Customer agree that the following services will be provided by JCI 7 at the Customer's facility in conjunction with the installed equipment and systems under this 8 Agreement. System /0$M Premium Coverage Component Collection Ft Flare Operations Et Preventive Repair/ Replacement System Maintenance Maintenance Labor Et Materials Labor 8t Materials Labor Et Materials Dehydration Et Operations Et Preventive Repair/ Replacement Compression System Maintenance Maintenance Labor 8: Materials Labor 8t Materials Labor Et Materials Monitoring 8t Data Operations Et Preventive Repair/ Replacement Collection Maintenance Maintenance, including Labor Et Materials Labor Et Materials Auto Calibration of LandTec System Communication costs Labor Et Materials associated with remote monitoring Et data collection Remote Monitoring 8t Remote Monitoring of Alarm Notification Et Service Response System Operation On -Site Service Parameters - Response - 24 hours a Continuous day / 7 days a week Mass Flow Meter Operations 8t Annual 3rd Party Repair/ Replacement Maintenance Calibration Et Labor 8t Materials Certification Pressure Testing of Annual Pressure Test to Investigate and Repair Testing Labor Et Materials LFG Transmission Verify Integrity of LFG Leaks. Repair Labor Et Materials Pipeline ft Repairs, if Transmission Pipeline Required from Compressor to End -User Property Line. LFG System Data Data Collection Et Annually: By LFG Sales - Invoice Collection £t Analysis Analysis of LFG November 15th of each Generation, Monthly delivered to 3rd party calendar year, provide Monthly invoice will end - user /purchaser and to the City and to the include: Analysis of System end - user /purchaser a Performance - forecast of the LFG Volume (MMBtus) of LFG Continuous volume that is expected delivered to end -user, to be available for sale the applicable rate per for the coming calendar MMBtu for the month, year. and the total amount to be billed to the end user [PAGE 26 OF 391 CITY OF LITTLE ROCK, ARKANSAS JOHNSON CONTROLS, INC. Initials: Initials: [PAGE 27 OF 391 By January 30 of each for the month. calendar year, provide to the City the total LFG (in MMBtus) amount of LFG that delivered to end -user; was burned at the flare HHV value of LFG station for the previous delivered to end -user, calendar year, and the and if the HHV is +/- flared amount of LFG within LFG specification. as a percentage of the total LFG volume produced for the previous calendar year. Collection and Flare Monitoring, Inspections, Methane Surface Air Permit - Reporting as System Maintenance and Monitoring Et required Repairs and System Documentation Component Replacement due to normal wear and tear. Performance Measurement and Annual Reconciliation Assurance Services Reporting of Project of Guaranteed Project Benefits - Semi- Benefits Reconciliation Annually CITY OF LITTLE ROCK, ARKANSAS JOHNSON CONTROLS, INC. Initials: Initials: [PAGE 27 OF 391 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Schedule 3 Exhibit 1 SERVICES SCHEDULE LFG System - Performance Assurance Services The following services will be performed by a JCI Performance Assurance Specialist ( "PAS ") assigned to the City of Little Rock's LFGTE project. Services will be rendered at the indicated frequencies as set forth below: These services will provide the basis of the measurement and verification process that will be used to calculate and report the Project Benefits to the Customer: 1. Data Collection - The PAS will have the responsibility of gathering all information associated with LFG production, distribution, and quality of the LFG, as required for Monthly Reporting to City of Little Rock. 17 2. Data Evaluation - On a monthly basis, the PAS will have the responsibility of evaluating the 18 data and information gathered to determine status of operation of the collection, compression, 19 and metering systems. This will also include evaluation of Natural Gas market data to 20 determine the current monthly pricing of LFG to Yd party end user /LFG purchaser based on the 21 Utility Purchasing Agreement between the City of Little Rock and the 3rd party end user/ LFG 22 purchaser. 23 3. Utility Purchasing Invoice Creation - On a monthly basis, the PAS will have the responsibility 24 of creating and submitting utility invoices for use by the City of Little Rock to invoice 3rd party 25 end - user /purchaser of the LFG. 26 4. Technical Support and Consulting - Provide technical support to City of Little Rock on billing 27 questions from 3rd party end - user /LFG purchaser, as required. 28 29 Monthly 30 1. Report to Customer the quantity (volume Et Btus) of landfill gas delivered to 3rd party end - 31 user /LFG purchaser. 32 2. Calculate and report to the Customer the monthly billing amount for the 3rd party end - user /LFG 33 purchaser. 34 3. Provide LFG Utility Invoice for City of Little Rock to issue to 3rd party end - user /LFG purchaser. 35 Annual Reconciliation of Protect Benefits 36 1. JCI shall provide annual reconciliation of the Project Benefits as calculated per Schedule 2, 37 Exhibit 2. 38 39 Dehydration /Compression System and Auxiliary System - Related Equipment 40 1. On -site inspections, as required. 41 2. Preventative maintenance, as required. 42 3. Repair / Replacement of system components as required. 43 4. Scheduled System downtime to perform required preventive maintenance and repairs shall be 44 for a minimum of one week per year. 45 5. Scheduled System downtime to perform major equipment component replacements shall be at 46 each five year interval and shall be for a minimum of two weeks per year. 47 Data Collection and Monitoring System - Land Tec /JCI Equipment and Systems [PAGE 28 OF 391 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 1. Real time, continuous, and web accessible data collection and storage. 2. Maintain historical records of system operation and landfill gas transported. On -Site Service Response - 365 days a year / 7 days a week / 24 hours a day, as Required to Ensure System Operation 1. Provide real -time monitoring of flare system and compression/ dehydration system operation. 2. Provide local mechanical and technical service response 24 hours a day / 7 days a week upon alarm notification of system abnormalities or system shut -down. LFG Collection and Flare System - Quarterly or as Required to Ensure Proper Operation 1. Routine inspection by qualified technician of the installed LFG collection and flare system. 2. Routine inspections of the visible wellhead components for air leaks. 3. Routine Maintenance of the installed equipment. 4. Required repairs to the installed equipment. 5. System Component Replacement due to normal usage, such as pumps, wellheads, piping and sump components. 6. Tuning and balancing of the installed well -field equipment for optimum LFG generation. 7. On -site inspection and logging of specific and required data as per NSPS regulations. 8. Methane Surface Monitoring, Documentation and Reporting as required by regulatory agencies. Air Permit Reporting Requirements Surface Methane Monitoring. Data tracking, collection, preparation and submission of reports to ADEQ to meet Air Permit requirements. Dated 2006. CITY OF LITTLE ROCK, ARKANSAS Signature: Printed Name: Bruce Moore Title: City Manager Approved as to Legal Form: Thomas M. Carpenter City Attorney By: Beth Blevins Carpenter Deputy City Attorney JOHNSON CONTROLS, INC. Signature: Printed Name: Richard L. Harvey Title: South Region Solutions Manager [PAGE 29 of 391 4 Schedule 4A PRICE AND PAYMENT TERMS SCHEDULE 1. The Customer shall make payments to JCI for Work performed and acceptable to the City of Little Rock, as well as payments for Services acceptable to the City of Little Rock rendered pursuant to the Services Schedule. 8 (a) The price to be paid by the Customer for the Scope of Work set forth in Schedule 1 shall be 9 for actual costs and shall be in an amount not to exceed $3,750,000.00 (Three million seven 10 hundred fifty thousand dollars and no cents). Progress payments, including payment for 11 materials delivered to JCI and work performed on and off -site, shall be made to JCI as follows: 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 0i First payment due: 21 days after contract execution by both parties Amount: $275,000.00 Project Development and Engineering Services Remaining payments shall be invoiced monthly using a Customer - approved schedule of values. The schedule of values shall be provided by JCI to Customer for Customer's review and written approval within twenty (20) calendar days of execution of this Agreement by both parties Invoices shall be sent to customer by the 5th of each month and shall be payable by the 25th of each month in which they are invoiced. Final payment, as set forth in the Customer - approved schedule of values, constituting the actual entire unpaid balance for the Scope of Work performed as set forth in Schedule 1 and acceptable to the City of Little Rock, shall be made to JCI within 30 calendar days after the Substantial Completion Date. Payments may be withheld by Customer on account of any breach of this Agreement by JCI and claims by third parties (including JCI subcontractors and material suppliers), but only to the extent that written notice has been provided to JCI and JCI has failed, within ten (10) calendar days of the date of receipt of such notice, to provide security acceptable to Customer to protect Customer from any loss, cost, or expense whatsoever related to such claims. (b) The price for JCI's Services during the Term of this Agreement is as follows: Year 1 - $165,351.00 Year 6- $201,173.00 Year 11 - $244,763.00 Year 2 - $171,965.00 Year 7 - $209,220.00 Year 12 - $254,553.00 Year 3 - $178,843.00 Year 8 - $217,588.00 Year 13 - $264,735.00 Year 4 - $185,996.00 Year 9 - $226,291.00 Year 14 - $275,324.00 Year 5 - $193,436.00 Year 10 - $235,349.00 Year 15 - $286,337.00 33 The total price to be paid by the Customer for Services performed by JCI and 34 acceptable to the City of Little Rock during the fifteen (15) year Term of this Agreement shall 35 be $3,310,924 (Three million three hundred ten thousand nine hundred twenty four dollars and 36 no cents). 37 38 This amount will be paid to JCI in monthly installments, beginning on the first month 39 that Project Benefits begin to be measured under this Agreement. These payments will be due [PACE 30 of 391 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 and payable when the Customer receives JCI's invoice and in advance of the services JCI is to provide and shall be made throughout the Service Term. Year Monthly Amount Year Monthly Amount Year Monthly Amount 1 $13,779.25 6 $16,764.42 11 $20,396.92 2 $14,330.42 7 $17,435.00 12 $21,212.75 3 $14,903.58 8 $18,132.33 13 $22,061.25 4 $15,499.67 9 $18,857.58 14 $22,943.67 5 $16,119.67 10 $19,612.42 15 $23,861.42 2. CUSTOMER PURCHASE ORDERS. The Customer acknowledges and agrees that any purchase order issued by Customer, in accordance with this Agreement, is intended only to establish payment authority for the Customer's internal accounting purposes. No purchase order shall be considered to be a counteroffer, amendment, modification, or other revision to the terms of this Agreement. Dated 2006. CITY OF LITTLE ROCK ARKANSAS Signature: Printed Name: Bruce Moore Title: City Manager Approved as to Legal Form: Thomas M. Carpenter City Attorney By: Beth Blevins Carpenter Deputy City Attorney JOHNSON CONTROLS, INC. Signature: Printed Name: Richard L. Harvey Title: South Region Solutions Manager [PACE 31 OF 391 I Schedule 4B 3 PROJECT INSTALLATION SCHEDULE [PACE 32 OF 39] Exhibit A 2 3 System Layout 4 5 The project scope of work and pricing contained herein is based upon the attached system layout. 6 [PAGE 33 of 39] 1 Exhibit B 3 Gas Specification 4 5 The gas specification is based upon the gas pump test results in Exhibit C, and is the gas specification 6 used for the purposes of the utility purchasing agreement by and between the City of Little Rock and 7 the end - user /purchaser of the Landfill Gas. 8 9 10 11 March 14, 2006 12 13 City of Little Rock 14 Landfill Gas - Cells 1 and 2 15 Breakdown of Gas Compounds 16 17 18 19 Compound Amount Units Heating Value 450 to 550 and not less than 365 (Btu /ft HHV Methane 45 to 55 M Hydrogen Sulfide (HZS) 5 to 50 (ppmv) Oxygen (OZ) 2 to 5 M Nitrogen (NZ) 5 to 10 M Carbon Monoxide (CO) 0.5 to 1 M Carbon Dioxide (CO2) 40 to 55 M Propane 0.003 M [PAGE 34 OF 391 1 Exhibit C 3 LF Gas Content Analysis 4 5 The projected quality and quantity of LFG is based upon the results of the attached Gas Content 6 Analysis, dated 12/20/2005, by Air Toxics, Inc. The complete report from this analysis is on the 7 following pages. Additionally, H25 testing was performed on site by FTN Associates. The end - 8 user /purchaser of the LFG (Geo Specialty Chemicals) has reviewed this analysis and will accept the gas 9 for use as specified in Exhibit B. The system to be installed does not include any additional equipment 10 to clean the landfill gas. 11 12 13 [PAGE 35 of 391 [PAGE 36 OF 39] IH - -- ----- -------------- -------------- --- ......... .. - ..... .. .... ............ - .. ........ R R iQ e. I IL LL E PL �a! 03 . .. . ....... 11 CL 30 10 40 10 a 0 ;.O 9 op An .0 a x 40 0) in E 78 rK E Eo LL A 5 8 : Wo" E LU CL a e 8 c CL 0 8 9 8 I 0 7& I co 8 E co < o w JAM [PAGE 36 OF 39] [PAGE 37 OF 3 9] ------------- - ---------------- ---------- .................. ............. ----------- ---- - ------ --- - - -- -- - --- ------ --------- - ------ .... ... ...... 21 0 k I C 14 44 CL: 19 a a 22 'N �jo fill 001 to v:,E Im CL HC tic Mgt 0-13 IL -T V 0-19 8 [PAGE 37 OF 3 9] � � E T C n --gym CL B E; rN� CL V m CL p ' 32 E m S c E & V CC N �Wmgc�Q =C °' m �, F- io m o m m m �1 m m 'o N y m T9 0 0 L p•+q m r+ ca — 0 E c 0 E LL �►. 'C '! 0 L 'O 3 F- 9 •- C a J o $ 12 0 ii a U 3 U �L T- N m er 10 m ti o0 [PACE 38 of 39] Zs ' vC7co IL c am �g s W [PACE 39 of 391 1- 6 r rp rp rt ro rw Q $ i B S r* r B� E z R. I Y MY N fil. �pEE � iiiiii IL b [PACE 39 of 391