AGREEMENT
This Agreement (“Agreement”), dated for purposes of identification only this _____ day of __________________, 2024, is made and entered into by and between the City of Anaheim, a municipal corporation (“Anaheim”), and DILO Production, Inc., a Florida corporation, dba DILO Direct (“Contractor”). Anaheim and Contractor are sometimes individually referred to as “Party” and collectively as “Parties.”
RECITALS
A. Anaheim is a municipal corporation duly organized and validly existing under the laws of the State of California with the power to carry on its business as it is now being conducted under the statutes of the State of California and the Anaheim Charter; and B. Anaheim desires to engage Contractor to provide comprehensive, as-needed services for sulfur hexafluoride (“SF6”) gas management on Anaheim’s electrical equipment (“Project”): e.g., extracting and recycling SF6 gas from decommissioned electrical equipment, performing purity testing of SF6 gas in electrical components, conducting calibration and maintenance services on gas-extraction and -transferring equipment, conducting leak checks on electrical equipment, and preparing associated regulatory reports; and C. Contractor possesses the skill, experience, ability, licenses, and certifications necessary to perform the Project services; and
D. Anaheim has solicited and received a proposal from Contractor, has evaluated Contractor’s previous experience and expertise, and Anaheim desires to retain Contractor to render the Project services under the terms and conditions set forth in this Agreement.
AGREEMENT
NOW, THEREFORE, for and in consideration of the mutual promises, covenants, and conditions contained herein, the Parties agree as follows:
1. SERVICES TO BE PROVIDED BY CONTRACTOR
In compliance with the terms and conditions of this Agreement, Contractor shall provide to Anaheim all labor, materials, tools, equipment, services, systems, and incidental and customary work necessary for the Project (“Services”). The Services are more particularly described in the Scope of Services attached hereto as Exhibit A and incorporated herein by this reference (“Scope of Services”). The Public Utilities General Manager (“General Manager”) or designee is authorized to add, modify, or delete tasks from the Scope of Services.
2. TERM
The term of this Agreement shall commence on the Effective Date and shall terminate on the fifth (5th) anniversary of the Effective Date, unless terminated earlier as set forth in Section 24 below (“Term”). The General Manager or designee is authorized to extend the Term for up to twelve (12) additional months to allow Contractor to complete the Services or any Extra Services 2 (defined below). To extend the Term, the General Manager or designee must provide Contractor with written notice of Anaheim’s election to extend before expiration of the Term.
3. TIME OF PERFORMANCE
3.1 Time is of the essence in the performance of this Agreement, and Contractor shall perform and complete all Services in a diligent and timely manner. Contractor’s failure to adhere to schedules agreed upon by the Parties at the time of Anaheim’s ordering of Services per Exhibit A may result in Anaheim’s election to terminate this Agreement.
3.2 The time period(s) specified for performance of the Services rendered, pursuant to this Agreement, shall be extended because of any delays due to unforeseeable causes beyond the control and without the fault or negligence of Contractor, including, but not restricted to, acts of God or of the public enemy; unusually severe weather, fires, earthquakes, floods, pestilence, or other natural catastrophes; epidemics; quarantine restrictions; riots; strikes; freight embargoes; wars; litigation; civil disturbance or disobedience; labor dispute; labor or material shortage; sabotage; change in government priorities; restraint by court order or public authority; and action or non-action by or inability to obtain the necessary authorization or approvals from any governmental agency or authority, and/or acts of any governmental agency, including Anaheim, which by the exercise of due diligence such Party cannot reasonably be expected to avoid and by which exercise of due diligence has been unable to overcome, if Contractor shall within ten (10) days of the commencement of such delay notify Anaheim’s project administrator (“Project Administrator”) in writing of the causes of the delay. The Project Administrator shall ascertain the facts and the extent of delay and may extend the time for performing the Services for the period of the enforced delay if, in the judgment of the Project Administrator, such delay is justified. The Project Administrator’s determination shall be final and conclusive upon the Parties. In the event of delay, however caused, Contractor’s sole remedy shall be an extension of the Term, pursuant to this Section, and Contractor shall not be entitled to recover damages against Anaheim.
4. COMPENSATION
4.1 Anaheim shall pay Contractor for the Services satisfactorily completed pursuant to the unit prices and billing rates contained in Table 1 of Exhibit A and incorporated herein by reference (“Prices”). No changes to the Prices may be made without the prior written authorization of the General Manager or designee.
4.2 Anaheim shall reimburse Contractor for only those costs or expenses specifically approved in writing in advance by the General Manager or designee.
4.3 Except as provided in Section 4.4 below, the Parties understand and agree that full and complete payment for all Services provided under this Agreement, including, but not limited to, all reimbursable expenses and subconsultant fees, if any, shall not exceed two hundred fifty thousand ($250,000) (“Contract Amount”). The Contract Amount does not constitute a payment or guarantee of payment to Contractor but instead constitutes a spending option for Anaheim, as may be needed.
3 4.4 The General Manager or designee is authorized to approve additional expenditures not to exceed fifteen (15%) of the Contract Amount for additional services that are not included in the Scope of Services (“Extra Services”), provided that the General Manager determines that (a) the Extra Services are necessary for the successful completion of the Services; (b) the proposed Extra Services were unforeseen by Anaheim at the time it entered into the Agreement; (c) budget appropriations are available; and (d) in the General Manager’s professional opinion, it is in Anaheim’s best interest to receive the Extra Services.
4.4.01 In no event shall Contractor render Extra Services without the written authorization of the General Manager or designee.
4.4.02 Extra Services shall be billed at either the Prices set forth in Table 1 of Exhibit A or at a fixed price, at the General Manager’s discretion. If billed at a fixed price, Contractor shall provide Anaheim with a general description of the Extra Services to be performed with a proposed price.
4.4.03 Any approved Extra Services will be incorporated into the Services and the Agreement upon the Parties’ execution of a letter agreement (“Extra Services Letter”) that contains (a) the agreed price for the Extra Services and (b) a description of the Extra Services.
Contractor shall commence performance of the Extra Services either upon the Parties’ execution of the Extra Services Letter or such other time expressly indicated therein.
4.4.04 Other than the Extra Services that the General Manager or designee is authorized to approve pursuant to this Section 4.4, Contractor shall not render additional Services beyond the scope of this Agreement unless such services are first approved by a written amendment to this Agreement.
4.5 Contractor shall submit monthly invoices to Anaheim describing the work that was performed the preceding month. Contractor’s invoices shall be based on the line items contained in Table 1 of Exhibit A. For items authorized in advance by Anaheim for which, in Anaheim’s sole opinion, a line-item equivalent is not listed, Contractor’s invoice shall include the name of the person who performed the work, a brief description of the Services performed and/or the specific task in the Scope of Services to which it relates, the date the Services were performed and a description of any reimbursable expenditures. Anaheim shall pay Contractor no later than thirty (30) days after approval of the monthly invoice by Anaheim staff.
4.6 All Parties recognize that the continuation of this Agreement after the close of any fiscal year of Anaheim, which fiscal year ends on June 30 of each year, shall be subject to budget approval providing for or covering such contract items as an expenditure in said budget.
Anaheim does not represent that said budget item will be actually adopted, said determination being the determination of the City Council at the time of the adoption of the budget herein. No penalty shall accrue to Anaheim in the event this provision shall be exercised. Should termination be accomplished in accordance with this Section, the Parties shall negotiate a settlement based on monies paid and due, items delivered, and Services provided. 4 5. PROJECT MANAGER
5.1 Contractor designates Chris Barrett, Regional Manager, as its “Project Manager,” who shall coordinate the Services. This Project Manager shall be available to Anaheim at all reasonable times during the Term of this Agreement. It is expressly understood that the experience, knowledge, capability, and reputation of the foregoing Project Manager is a substantial inducement for Anaheim to enter into this Agreement. Therefore, the foregoing Project Manager shall be responsible during the Term of this Agreement for directing all activities of Contractor and devoting sufficient time to personally supervise the provision of Services hereunder. The Contractor may not change the Project Manager without the General Manager or designee’s express written authorization.
5.2 Any personnel or subconsultant, if any, who fail or refuse to perform the Services in a manner acceptable to Anaheim or who are determined by Anaheim, in its sole discretion, to be uncooperative, incompetent, a threat to the adequate or timely completion of the Project, or a threat to the safety of persons or property, shall be promptly removed from the Project by Contractor at the request of Anaheim. Contractor warrants that it will continuously furnish the necessary personnel to complete the Services on a timely basis as contemplated by this Agreement.
6. ADMINISTRATION
The Anaheim Public Utilities Department (“APU”) will administer this Agreement. The following APU employees are authorized to take the below actions pursuant to this Agreement:
• The General Manager is authorized to take any action on behalf of Anaheim as set forth herein and to terminate this Agreement in accordance with Section 24 below.
• Anaheim designates Jonathan Sanks as its “Project Administrator.” The General Manager or designee may change the Project Administrator at any time, and Anaheim will provide Contractor written notice of such change as soon as is practical. The Project Administrator, or designee, shall have the power to act on behalf of Anaheim for ordering, reviewing, and approving all Services performed by Contractor under this Agreement. The Project Administrator shall not be authorized to approve Extra Services, change unit prices/billing rates, or terminate Services under this Agreement.
7. STANDARD OF CARE
7.1 As a material inducement for Anaheim to enter this Agreement, Contractor represents and warrants that Contractor is a provider of first-class work and services and is experienced in performing the Services contemplated herein, and in light of such status and experience Contractor covenants that it shall follow the highest professional standards in performing the work and Services required hereunder and that all work will be of good quality.
Contractor further warrants that all employees and subcontractors, if any, shall have sufficient skill and experience to perform the Services assigned to them. For purposes of this Agreement, 5 the phrase “highest professional standards” shall mean those standards of practice recognized by one or more first-class firms performing similar work under similar circumstances.
7.2 Contractor represents and warrants to Anaheim that it has, shall obtain, and shall keep in full force in effect during the Term hereof, at its sole cost and expense, all licenses, permits, qualifications, insurance, and approvals of whatsoever nature that is legally required of Contractor to practice its profession, including those licenses and certifications listed in Exhibit A. Contractor shall maintain a City of Anaheim business license during the Term.
7.3 At no cost to Anaheim, Contractor shall re-perform any Services that Anaheim reasonably deems unsatisfactory.
8. FAMILIARITY WITH WORK
By executing this Agreement, Contractor represents and warrants that Contractor: (i) has thoroughly investigated and considered the Services to be performed; (ii) has carefully considered how the Services should be provided; and (iii) fully understands the facilities, difficulties, and restrictions attending the provision of the Services under this Agreement. Should Contractor discover any latent or unknown conditions materially differing from those inherent in the provision of such Services or as represented by Anaheim, Contractor shall immediately inform Anaheim of such fact and shall not proceed except at Contractor’s risk until written instructions are received from Anaheim.
9. INDEPENDENT CONTRACTOR
9.1 Neither Anaheim nor any of its employees shall have any control over the manner, mode, or means by which Contractor, its agents or employees, perform the Services, except as otherwise set forth herein. Except as expressly provided herein, Anaheim shall have no voice in the selection, discharge, supervision, or control of Contractor’s employees, servants, representatives or agents, or in fixing their number, compensation, or hours of service.
Contractor shall perform all Services as an independent contractor of Anaheim and shall remain at all times, as to Anaheim, a wholly independent contractor with only such obligations as are consistent with that role. Contractor shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of Anaheim. Anaheim shall not in any way or for any purpose become or be deemed to be a partner of Contractor in its business or otherwise or a joint venturer or a member of any joint enterprise with Contractor.
9.2 In consideration for the compensation paid to Contractor by Anaheim, Contractor agrees that Anaheim shall not be liable or responsible for any benefits, including, but not limited to, worker’s compensation, disability, retirement, life, unemployment, health, or any other benefits that Contractor offers to its employees/agents, and Contractor agrees that it shall not sue or file a claim, petition, or application therefor against Anaheim or any of its appointed or elected officials, officers, employees, agents, representatives, or sureties. 6 10. INSURANCE
10.1 Without limiting Anaheim’s right to indemnification, it is agreed that Contractor shall secure, prior to commencing any activities under this Agreement, and maintain, during the Term of this Agreement, insurance coverage as follows:
10.1.01 Workers’ Compensation Insurance as required by California law and Employers’ Liability Insurance in an amount not less than $1,000,000 per occurrence.
10.1.02 Commercial/Comprehensive General Liability Insurance, including coverage for Premises and Operations, Contractual Liability, Personal Injury Liability, Products/Completed Operations Liability, as well as Independent Contractor’s/Contractor’s liability where appropriate, in an amount not less than $2,000,000 per occurrence, $4,000,000 annual aggregate, written on an occurrence form. Such insurance shall be written on a primary basis, but may include a deductible or self-insured retention of not more than $10,000 per occurrence, provided that such deductible or self-insured retention is disclosed to Anaheim, in writing, at the inception of this Agreement.
10.1.03 Commercial/Comprehensive Automobile Liability Coverage including - as applicable - owned, non-owned, and hired autos, in an amount not less than $2,000,000 per occurrence, combined single limit, as required by California law.
10.1.04 Professional Liability Insurance, inclusive of Cyber Liability, in an amount not less than $2,000,000 per occurrence or per claim. Such insurance shall be written on a primary basis, but may include a deductible or self-insured retention of not more than $10,000 per occurrence, provided that such deductible or self-insured retention is disclosed to Anaheim, in writing, at the inception of this Agreement.
10.2 Any required coverage written with primary and excess layers to satisfy the minimum requirements of this Agreement must be submitted for approval by Anaheim’s Risk Manager prior to the inception of the final Agreement.
10.3 Each insurance policy required by this Agreement shall contain the following clause or shall otherwise provide for the following conditions: “This insurance shall not be cancelled, or limited in scope or coverage by Contractor, until after thirty (30) days’ prior written notice has been given to the City Clerk, City of Anaheim, 200 S. Anaheim Blvd., Anaheim, CA 92805, except in the event of cancellation for non-payment of premium that shall provide for not less than ten (10) days’ notice.”
10.4 Each insurance policy required by this Agreement, except policies for Professional Liability and Workers’ Compensation, shall contain the following clauses or shall otherwise provide for the following conditions:
• “It is agreed that any insurance maintained by Contractor, pursuant to this Agreement, shall be primary to, and not contribute with, any insurance or self- insurance maintained by the City of Anaheim.”
7 • “The City of Anaheim, its officers, agents, employees, representatives, and Anaheim-designated volunteers are added as additional insureds as respects the acts, omissions, operations, and activities of, or on behalf of, the named insured, in regard to products supplied to, or work or services performed for, or related to, the City of Anaheim.”
10.5 Prior to commencing any work under this Agreement, Contractor shall deliver to Anaheim insurance certificates confirming the existence of the insurance required under this Agreement and including the applicable clauses referenced above. Also, within thirty (30) days of the execution date of this Agreement, Contractor shall provide Anaheim: (i) endorsements to the insurance policies which add to these policies the applicable clauses referenced above; or (ii) in lieu of said endorsements, documentation acceptable to Anaheim evidencing that the coverage, terms, and conditions set forth in the above-referenced clauses are otherwise included in said insurance policies. Insurance required hereunder shall be placed with insurers: (i) admitted to write insurance in California; (ii) possessing an A. M. Best’s rating of A VII or higher; or (iii) otherwise acceptable to Anaheim, with prior written permission from Anaheim. In the event that a claim or other legal action is filed against Anaheim, and if Anaheim, in its good faith opinion, believes it may have coverage under any of the insurance required herein, then Anaheim has the right to demand, and to receive within a reasonable time period, copies of the insurance policies related to such required insurance; provided, however, that this provision shall not apply if the Parties agree that Contractor shall fully defend, hold harmless, and indemnify Anaheim against any such claim or other legal action.
10.6 In addition to other remedies Anaheim may have if Contractor fails to provide or maintain any insurance policies or policy endorsements to the extent and within the time herein required, Anaheim may, at its sole option:
• Order Contractor to stop work under this Agreement and/or withhold any payment(s) which become due to Contractor hereunder until Contractor demonstrates compliance with the requirements hereof; or • Terminate this Agreement.
Exercise of any of the above remedies, however, is an alternative to other remedies Anaheim may have and is not the exclusive remedy for Contractor’s failure to maintain insurance or secure appropriate endorsements.
10.7 Nothing herein contained shall be construed in any way as limiting in any way the extent that a Contractor may be held responsible for payments of damages to persons or property resulting from Contractor’s (or Contractor’s contractors/subcontractor, if any) performance of the work covered under this Agreement.
10.8 In the event Contractor hires other persons or firms to perform some of the work related to this Agreement, Contractor shall ensure and certify to Anaheim in writing that: (i) the acts or omissions of such persons or firms are covered under the above-referenced liability insurance; or (ii) such firms maintain insurance equal to or better than and is subject to the same limits, terms, and conditions as the insurance required of Contractor under this Agreement 8 (except for firms that are not performing professional services; such firms shall not be required to carry the above-referenced professional liability insurance); and in either instance, Contractor shall provide, or cause to be provided, evidence of such insurance coverage, reasonably acceptable to Anaheim.
10.9 Anaheim’s Risk Manager is hereby authorized to amend the requirements set forth herein in the event that such amendment is in Anaheim’s best interest.
11. INDEMNIFICATION
11.1 As respects acts, errors, or omissions in the performance of professional services, Contractor agrees to indemnify and hold harmless Anaheim, its officials, officers, and employees from and against any and all claims, losses, damages, defense costs, or liability, of any kind or nature, directly arising out of the negligent acts, errors, or omissions of the Contractor or any sub-agent in the performance of professional services under this Agreement.
11.2 As respects all acts, errors, or omissions that do not arise directly out of the performance of professional services, including but not limited to those acts, errors, or omissions typically covered by general and automobile liability insurance, Contractor agrees to indemnify, defend (at Anaheim’s option), and hold harmless Anaheim, its officials, officers, employees, agents, and representatives from and against any and all claims, losses, damages, defense costs, or liability, of any kind or nature (collectively referred to hereinafter as “Claims”), arising out of or in connection with Contractor’s (or Contractor’s agent or sub-agent, if any) acts, errors, omissions, or work, relative to this Agreement; except for those Claims that arise out of the sole negligence or willful misconduct of Anaheim.
11.3 The obligations set forth in this indemnification provision (i) shall be in effect without regard to whether Anaheim, Contractor, or any other person maintains, or fails to maintain, insurance coverage, or a self-insurance program, for any such Claims and (ii) shall survive the termination of this Agreement.
12. PREVAILING WAGES
12.1 By executing this Agreement, Contractor certifies that it is aware of the requirements of California Labor Code sections 1720 et seq. and 1770 et seq., as well as California Code of Regulations, Title 8, section 16000 et seq. (“Prevailing Wage Laws”), which require the payment of prevailing wage rates and the performance of other requirements on certain “public works” and “maintenance” projects. Contractor agrees to fully comply with such Prevailing Wage Laws in the performance of the Services. The prevailing rates of per diem wages are available at:
http://www.dir.ca.gov/dlsr/DPreWageDetermination.htm
.
Contractor shall make copies of the prevailing rates of per diem wages for each craft, classification, or type of worker needed to execute the Services available to interested parties upon request and shall post copies at the Contractor’s principal place of business and at the project site.
9 12.2 Contractor shall pay all workers pursuant to the Prevailing Wage Laws and not less than the prevailing wage rates as determined by the Director of Industrial Relations in accordance with the provisions of the Labor Code. As provided in Labor Code section 1775, if Contractor violates the foregoing, Contractor shall forfeit, as a penalty to Anaheim, fifty dollars ($50) for each calendar day or portion thereof for each workman paid less than the stipulated prevailing wage rate for such work or craft in which such workman is employed, for any Service subject to the Prevailing Wage Laws. In addition to said penalty and pursuant to said section 1775, the difference between such stipulated prevailing wage rates and the amount paid to each workman shall be paid to each workman by Contractor, as applicable.
12.3 Contractor shall strictly adhere to the provisions of the Labor Code, including sections 1810 through 1813 and 1815, regarding minimum wages, the 8-hour day, the 40-hour week, overtime, Saturday, Sunday, and holiday work. Contractor shall forfeit to Anaheim the penalties prescribed in the Labor Code for noncompliance, including the penalties set forth in section 1813 for violations of sections 1810 through 1815.
12.4 Contractor shall comply with the provisions of Labor Code sections 1777.5 and 1777.6 and Title 8, sections 200 et seq. of the California Code of Regulations relating to apprentice employment and training. Contractor shall assume full responsibility for compliance with said sections with respect to all apprenticeable occupations providing Services. In the event of noncompliance by Contractor, Anaheim shall withhold the penalties provided for under section 1777.7 of the Labor Code from payments then due.
12.5 Pursuant to the requirements of section 1860 of the Labor Code, Contractor will be required to secure the payment of workers’ compensation to its employees in accordance with the provisions of section 3700 of the Labor Code.
12.6 Anaheim will not recognize any claim for additional compensation because of the payment by Contractor of any wage rate in excess of the prevailing wage rate effective on the Effective Date. The possibility of prevailing wage increases is one of the elements to be considered by Contractor at the time of the proposal submission and will not, under any circumstances, be considered as the basis of a claim against Anaheim for additional compensation.
12.7 Contractor shall maintain accurate payroll records in accordance with the provisions of Labor Code section 1776 and shall, upon request, file said records with Anaheim.
12.8 Contractor shall forfeit as a penalty to Anaheim twenty five dollars ($25) for each calendar day during which a Contractor’s employee subject to the Prevailing Wage Laws is required or permitted to work more than eight (8) hours in any one calendar day and forty (40) hours in any one calendar week, in violation of the provisions of the Labor Code and, in particular, section 1810 to section 1815 thereof, inclusive, except that the Services performed by the employees of Contractor in excess of eight (8) hours per day and forty (40) hours during any one week shall be permitted upon compensation of all hours worked in excess of eight (8) hours per day at not less than one and one-half times the basic rate of pay as provided in section 1815. 10 12.9 Contractor shall defend, indemnify, and hold Anaheim, its elected officials, officers, employees, and agents free and harmless from any claims, liabilities, costs, penalties, or interest arising out of any failure or alleged failure by Contractor or its employees, agents, contractors, and subcontractors to comply with the Prevailing Wage Laws.
13. PERFORMANCE OF SERVICES
Contractor is responsible for keeping the Project Administrator or designee informed on a regular basis regarding the status and progress of the Services, activities performed and planned, and any meetings that have been scheduled or are desired.
14. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
The Parties recognize that a substantial inducement to Anaheim for entering into this Agreement is the professional reputation, experience, and competence of Contractor. Contractor has no right to assign, transfer, delegate, or otherwise encumber (together “Assignment”) any rights, obligations, duties, interests, or privileges in or arising out of this Agreement, including as a result of a merger, acquisition, consolidation, or other form of corporate assimilation, without the prior written consent of Anaheim. Any such purported Assignment without Anaheim’s prior consent shall be void as to Anaheim. If Anaheim approves an Assignment, this Agreement and the covenants and conditions contained herein shall be binding upon and inure to the benefit of and shall apply to the permitted successors and assigns of Contractor.
15. SUBCONTRACTING
Except for those subcontractors set forth in the Scope of Services, if any, Contractor shall not subcontract any portion of the work to be performed under this Agreement without the prior written authorization of Anaheim. Contractor shall be fully responsible to Anaheim for all acts and omissions of any approved subcontractor. Nothing in this Agreement shall create any contractual relationship between Anaheim and the subcontractor, nor shall it create any obligation on the part of Anaheim to pay or ensure the payment of any monies due to any such subcontractor other than as otherwise required by law. Anaheim is an intended beneficiary of any work performed by any subcontractor for purposes of establishing a duty of care between the subcontractor and Anaheim pursuant to this Agreement.
16. USE AND OWNERSHIP OF DOCUMENTS AND DATA
16.1 Anaheim shall furnish to Contractor such documents, data, and materials as may be relevant and pertinent to the provision of Services hereunder as Anaheim may possess or acquire.
16.2 All documents, data, and written materials furnished by Anaheim to Contractor pursuant to Section 16.1 shall remain the property of Anaheim and shall be returned to Anaheim upon termination of this Agreement, for any reason. All documents, data, or written material prepared or caused to be prepared by Contractor, its officers, employees, agents, and subcontractors in the course of implementing this Agreement shall become the exclusive property of Anaheim, and Anaheim shall have the sole right to use such materials in its discretion without further compensation to Contractor or any other party. Contractor shall, at 11 Contractor’s sole cost and expense, provide such documents, data, and material to Anaheim upon prior written request.
17. CONFIDENTIALITY
17.1 “Confidential Information” means, with respect to a Party hereto, all information or material that are either (1) marked or identified as “Confidential,” “Restricted,” or “Proprietary Information” or other similar marking or identification, or (2) the other Party, as recipient, knew or under the circumstances, should have known, was considered confidential or proprietary by the Disclosing Party (as defined below). Confidential Information shall consist of all information, whether in written, oral, electronic, digital, or other form that was furnished in connection with this Agreement by the Disclosing Party or its Representatives (“Representative” is defined as any elected and appointed official, affiliate, director, officer, employee, agent, advisor, or consultant of a Party or any of its subsidiaries or affiliates) to the Receiving Party (as defined below) or to its Representatives and specifically includes but is not limited to Anaheim’s individually identifiable customer information and Anaheim’s customer usage data and financial data.
17.2 Contractor and Anaheim shall each hold the other’s Confidential Information in confidence. Neither Party shall make the other’s Confidential Information available in any form to any third party or use the other’s Confidential Information for any purpose other than as specified in this Agreement. The Party providing Confidential Information (“Disclosing Party”) to the other Party (“Receiving Party”) shall remain the sole owner of such information. Except as provided elsewhere within this Agreement, nothing contained in this Agreement shall be construed as granting or conferring any right or license in any Confidential Information or in any patents, copyrights, software, or other technology, either expressly or by implication to the Receiving Party, its Representatives, or to others. The term Confidential Information shall not include any of the following: (1) information already in possession of, or already known to, the Receiving Party as of the Effective Date without an obligation of confidentiality; (2) information in the public domain at the time of the disclosure, or which, after such disclosure, enters into the public domain through no breach of this Agreement by the Receiving Party or its Representative(s); (3) information lawfully furnished or disclosed to the Receiving Party by a non-party to this Agreement without any obligation of confidentiality and through no breach of this Agreement by the Receiving Party or its Representative(s); (4) information independently developed by the Receiving Party without use of any Confidential Information of the Disclosing Party; or (5) information authorized in writing by the Disclosing Party to be released from the confidentiality obligations herein.
17.3 By virtue of this Agreement, each Party hereto may disclose to the other Party information that is Confidential Information. This Agreement does not diminish, revoke, or supersede any existing confidentiality, non-disclosure, or similar agreement between the Parties that does not pertain to the subject matter of this Agreement. However, any Confidential Information, whether or not previously disclosed, that pertains to the subject matter of this Agreement shall be governed by the terms of this Section 17, which shall supersede any such previous agreement with respect to such Confidential Information. Any Confidential Information relating to the subject matter of this Agreement that was exchanged under such previous 12 agreement shall be treated as though it was exchanged under this Agreement as of the date of such exchange.
17.4 The Receiving Party will treat all Confidential Information of the Disclosing Party, no matter written, electronic, or oral, as confidential and proprietary, and the Receiving Party shall only use such information in furtherance of this Agreement. As such, the Receiving Party shall hold in confidence the Confidential Information of the Disclosing Party and ensure that such Confidential Information is not disclosed to any other person or entity, except as expressly permitted by this Agreement or as authorized in writing by the Disclosing Party.
Receiving Party shall not disclose Confidential Information of the Disclosing Party received under this Agreement to any person other than its Representatives who require knowledge of such Confidential Information in furtherance of this Agreement. The Receiving Party shall inform its Representatives of the confidential nature of the Confidential Information of the Disclosing Party and advise such Representatives of the limitations on the use and disclosure and prohibition on making copies or summaries of such Confidential Information. The Receiving Party shall be responsible for any breach of this Agreement by its Representatives. Neither Party shall use the Confidential Information of the other Party for any commercial purpose.
17.5 If the Receiving Party becomes legally compelled (by oral questions, interrogatories, request for information or documents, subpoena, civil investigative demand, or similar process) to disclose any Confidential Information of the Disclosing Party or is requested Confidential Information pursuant to the California Public Records Act or similar law, the Receiving Party will provide the Disclosing Party with written notice of such an occurrence (if so permitted) as soon as possible, but in no event later than five (5) days after knowledge of Contractor’s obligation to such requirement. Thereafter, at its sole costs and expense, the Disclosing Party may seek a protective order or other appropriate remedy or waive compliance with the provisions of this Agreement. So long as it is consistent with applicable law, the Receiving Party will not oppose action by, and the Receiving Party will cooperate with, the Disclosing Party, at the Disclosing Party’s sole cost and expense, to obtain an appropriate protective order or other reliable assurance that confidential treatment will be accorded the Confidential Information. If the Disclosing Party fails to obtain such protective order or other remedy, or if the Disclosing Party waives compliance with the requirements of the preceding sentence, the Receiving Party will disclose only that Confidential Information that it is legally required to disclose and will exercise commercially reasonable efforts, at Disclosing Party’s expense, to obtain reliable assurance that confidential treatment will be accorded the Confidential Information so disclosed.
17.6 In the event the Receiving Party discloses, disseminates, or releases any Confidential Information, except as expressly permitted by this Agreement, such disclosure, dissemination, or release will be deemed a material breach of this Agreement, and the Disclosing Party may demand prompt return of all Confidential Information previously provided to the Receiving Party. As soon as the Receiving Party becomes aware that it has made an unauthorized disclosure of Confidential Information, the Receiving Party shall take any and all necessary actions to recover the improperly disclosed Confidential Information and immediately notify Disclosing Party regarding the nature of the unauthorized disclosure and the corrective measures being taken. Each Party agrees that any breach of their confidentiality obligations could cause irreparable harm to the other Party, the amount of which would be extremely difficult to 13 estimate. Accordingly, it is understood and agreed that monetary damages would not be a sufficient remedy for any material breach of this Agreement and that specific performance and injunctive relief in addition to monetary damages shall be appropriate remedies for any breach or any threat of such breach. The provisions of this Paragraph are in addition to any other legal rights or remedies the Disclosing Party may have.
17.7 Within two (2) weeks of the termination of this Agreement, Contractor will return to Anaheim or destroy, to the extent permitted by law, any and all Confidential Information, including all originals, copies, translations, transcriptions, or any other form of said material without retaining any copy or duplicate thereof; provided that Contractor may retain Confidential Information contained on backup media created in the ordinary course of business; provided further that there is no effort to access such Confidential Information, and Contractor’s confidential obligations with respect to such information shall continue so long as such information is retained. Contractor shall certify in writing the destruction of the Confidential Information. Anaheim may perform an audit of Contractor’s records to confirm the return or destruction of the Confidential Information. Anaheim shall have this audit right for three (3) years after the termination of this Agreement.
17.8 Notwithstanding the termination of this Agreement, this Confidentiality Section shall survive the expiration or earlier termination of this Agreement.
18. FISCAL RECORDS AND AUDIT
Contractor shall keep records and invoices in connection with the Services. Contractor shall use recognized accounting methods in preparing such reports and invoices. Anaheim reserves the right to designate its own employee representative(s) or its contracted representative(s) with a certified public accounting firm, who shall have the right to audit Contractor’s accounting procedures and internal controls of Contractor’s financial systems and to examine any cost, revenue, payment, claim, other records, or supporting documentation resulting from any items set forth in this Agreement. If Contractor fails to provide supporting documentation satisfactory to Anaheim for costs charged, then Contractor agrees to reimburse Anaheim for those costs. Any such audit(s) shall be undertaken by Anaheim or its representative(s) at reasonable times and in conformance with generally accepted auditing standards. Contractor agrees to fully cooperate with any such audit(s).
This right to audit shall extend during the length of this Agreement and for a period of three (3) years, or longer if required by law, following the date of final payment under this Agreement. Contractor agrees to retain all necessary records/documentation for the entire length of this audit period.
Contractor will be notified in writing of any exception taken as a result of an audit. Any adjustments and/or payments that must be made as a result of any such audit or inspection of Contractor’s invoices and/or records shall be made within thirty (30) days from presentation of Anaheim’s findings to Contractor. If Contractor fails to make such payment, Contractor agrees to pay interest, accruing monthly, at a rate of ten percent (10%) per annum unless another section of this Agreement specifies a higher rate of interest, which higher rate would then prevail. Interest will be computed from the date of written notification of exception(s) to the date Contractor 14 reimburses Anaheim for any exception(s). If an audit inspection or examination in accordance with this article discloses overcharges (of any nature) by Contractor to Anaheim in excess of one percent (1%) of the value of that portion of the Agreement that was audited, the actual cost of Anaheim’s audit shall be reimbursed to Anaheim by Contractor.
19. WITHHOLDINGS
Anaheim may withhold payment to Contractor of any disputed sums until satisfaction of the dispute with respect to such payment. Such withholding shall not be deemed to constitute a failure to pay according to the terms of this Agreement. Contractor shall not discontinue the Services as a result of such withholding. Contractor shall have an immediate right to appeal to the City Manager or designee with respect to such disputed sums, and his decision shall be final.
Contractor shall be entitled to receive interest on any withheld sums at the rate of return that Anaheim earned on its investments during the time period, from the date of withholding of any amounts found to have been improperly withheld.
20. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional inexperience of Contractor that result in expense to Anaheim greater than what would have resulted if there were not errors or omissions in the Services performed by Contractor, the additional cost and expense shall be borne by Contractor. Nothing in this paragraph is intended to limit Anaheim’s rights under the law or any other sections of this Agreement.
21. ANAHEIM’S RIGHT TO EMPLOY OTHER CONTRACTORS
Contractor acknowledges and agrees that this Agreement and the provision of services hereunder are nonexclusive and that Anaheim may enter into similar agreements with other entities for the provision of similar services.
22. CONFLICTS OF INTEREST
Contractor or its employees may be subject to the provisions of the California Political Reform Act of 1974 (the “Act”), which (1) requires such persons to disclose any financial interest that may foreseeably be materially affected by the Services performed under this Agreement and (2) prohibits such persons from making, or participating in making, decisions that will foreseeably financially affect such interest.
If subject to the Act, Contractor shall conform to all requirements of the Act. Failure to do so constitutes a material breach and is grounds for immediate termination of this Agreement by Anaheim. Contractor shall indemnify and hold harmless Anaheim for any and all claims for damages resulting from Contractor’s violation of this Section.
23. NOTICES
Any notice to be made under this Agreement shall be in writing and shall be deemed effective when: (1) delivered personally, upon receipt or refusal of receipt by the receiving Party; (2) sent by registered or certified mail, return receipt requested, postage prepaid, on the date 15 shown on the return receipt or the date of refusal of receipt; (3) sent by recognized overnight courier service, the business day following deposit with the courier, with delivery fees prepaid; or (4) sent by facsimile transmission (“FAX”), upon the sending Party’s receiving confirmation of receipt from the receiving Party. Notices shall be addressed to the Parties at the following addresses:
If to Anaheim: City of Anaheim
Attention: City Clerk
200 S. Anaheim Boulevard, 2nd Floor
Anaheim, California 92805
FAX No. (714) 765-4105
With copies to: City of Anaheim
Attention: Public Utilities General Manager
201 S. Anaheim Blvd., Suite 1101
Anaheim, CA 92805
FAX No. (714) 765-4138
To Contractor: DILO Production, Inc. dba DILO Direct
Attention: Chris Barrett, Regional Manager
11642 Pyramid Drive
Odessa, FL 33556
Telephone No. (727) 376-5593
Each Party may change its address or FAX for notice by providing written notice to the other in accordance with this Section.
24. EARLY TERMINATION
24.1 “Default” shall mean the failure of Contractor to perform any of Contractor’s duties or obligations or the breach by Contractor of any of the terms and conditions set forth in this Agreement. In addition, Contractor shall be deemed to be in Default upon Contractor’s (i) application for, consent to, or suffering of, the appointment of a receiver, trustee, or liquidator for all or a substantial portion of its assets; (ii) making a general assignment for the benefit of creditors; (iii) being adjudged bankrupt; (iv) filing a voluntary petition or suffering an involuntary petition under any bankruptcy, arrangement, reorganization, or insolvency law (unless in the case of an involuntary petition, the same is dismissed within thirty (30) days of such filing); or (v) suffering or permitting to continue unstayed and in effect for fifteen (15) consecutive days any attachment, levy, execution, or seizure of all or a substantial portion of Contractor’s assets or of Contractor’s interests hereunder.
24.2 Anaheim shall not be deemed to be in default in the performance of any obligation required to be performed by Anaheim hereunder unless and until Anaheim has failed to perform such obligation for a period of thirty (30) days after receipt of written notice from Contractor specifying in reasonable detail the nature and extent of any such failure; provided, however, that if the nature of Anaheim’s obligation is such that more than thirty (30) days are required for its performance, then Anaheim shall not be deemed to be in Default if Anaheim 16 shall commence to cure such performance within such thirty (30) day period and thereafter diligently prosecute the same to completion.
24.3 In the event of any Default, Anaheim may immediately terminate this Agreement.
Such termination shall be effective immediately upon receipt by Contractor of written notice from Anaheim. In such event, Contractor shall have no further rights hereunder, and Anaheim shall have all other rights and remedies as provided by law.
24.4 Anaheim may terminate this Agreement at any time without the necessity of cause or Default by giving seven (7) days’ notice in writing to Contractor. In such event, the Parties shall have no further rights hereunder, except that Contractor shall be paid for all services adequately rendered prior to such termination. Contractor may not terminate this Agreement except for cause.
24.5 Anaheim may suspend or abandon the Services for any reason with or without notice. If any part of the Project is suspended or abandoned for any reason, Anaheim shall have the right to suspend or terminate the affected portions(s) of this Agreement, including any part of the Services. In the event of such suspension or termination, Contractor shall only expend such additional time as is necessary to assemble the Services in progress for the purpose of properly filing and closing the job and as is previously approved by Project Administrator. In no event shall additional time exceed ten percent (10%) of the total time expended on the suspended or abandoned portion of the Services prior to the date of notice of suspension or termination. In the event the Services are suspended for longer than six (6) months, Contractor may terminate this Agreement as it applies to the suspended portion of the Project by giving Anaheim at least thirty (30) days’ written notice.
24.6 Anaheim may withhold any payments to Contractor for the purpose of set-off until such time as the exact amount of damages due Anaheim from Contractor is determined. In addition, Anaheim may pursue all remedies available under law for breach of this Agreement.
The waiver by either Party of any breach to this Agreement shall not constitute a waiver as to any succeeding breach.
25. COMPLIANCE WITH ALL LAWS
Contractor shall at its own cost and expense comply with all statutes, ordinances, regulations, and requirements of all governmental entities, including federal, state, county, or municipal, whether now in force or hereinafter enacted. In addition, all work prepared by Contractor shall conform to applicable local, county, state, and federal laws, rules, regulations, and permit requirements and be subject to approval of the Project Administrator.
26. WAIVER
A waiver by either Party of any breach, of any term, covenant, or condition contained herein shall not be deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition contained herein, whether of the same or a different character. 17 27. INTEGRATED CONTRACT
This Agreement and the Exhibit hereto contain the entire agreement between Anaheim and Contractor with respect to the matters covered hereby, and no agreement, statement, or promise made by either Anaheim or Contractor that is not contained herein shall be valid or binding. No prior agreement, understanding, or representation pertaining to any the matters covered hereby shall be effective for any purpose.
28. CONFLICTS OR INCONSISTENCIES
In the event there are any conflicts or inconsistencies between this Agreement and the Exhibit, or any other attachments hereto, the terms of this Agreement shall govern.
29. INTERPRETATION
Each Party acknowledges that he/she/it has had the benefit of advice of competent legal counsel with respect to its decision to enter this Agreement. The provisions of this Agreement shall be interpreted to give effect to their fair meaning and shall be construed as prepared by both Parties.
30. AMENDMENTS
This Agreement may be modified or amended only by a written document executed by both Parties and approved as to form by the Anaheim City Attorney.
31. SEVERABILITY
If any term or provision of this Agreement or the application thereof to any person or circumstance shall, to any extent, be held invalid or unenforceable, the remainder of this Agreement or the application of its terms and provisions to persons and circumstances other than those to which it has been held invalid or unenforceable shall not be affected thereby, and each term and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.
32. REMEDIES CUMULATIVE
The remedies given to Anaheim and Contractor herein shall be cumulative and are given without impairing any other rights given Anaheim or Contractor by statute or law now existing or hereafter enacted and the exercise of any one remedy by Anaheim or Contractor shall not exclude the exercise of any other remedy.
33. NO THIRD-PARTY BENEFICIARIES
The Parties intend that neither rights nor remedies be granted to any third party as a beneficiary of this Agreement or of any covenant, duty, obligation, or undertaking established herein.
18 34. CONTROLLING LAW AND VENUE
The laws of the State of California shall govern this Agreement, and all matters relating to it and any action brought relating to this Agreement shall be adjudicated in a court of competent jurisdiction in the County of Orange, California.
35. DISCRIMINATION
Contractor agrees not to discriminate against any person or class of persons by reason of sex, color, race, creed, religion, marital status, handicap, ancestry, national origin, or other prohibited basis in its provision of Services or hiring of subcontractors or employees. To the extent this Agreement provides that Contractor offer accommodations or services to the public, such accommodations or services shall be offered by Contractor to the public on fair and reasonable terms.
36. AUTHORITY
Each individual executing this Agreement on behalf of a Party/corporation, nonprofit corporation, partnership, or other entity or organization represents and warrants that he or she is duly authorized to execute and deliver this Agreement on behalf of such Party/entity or organization and that this Agreement is binding upon the same in accordance with its terms.
Contractor shall, at Anaheim’s request, deliver a certified copy of its governing board’s resolution or certificate authorizing or evidencing such execution.
37. HEADINGS
The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
38. EFFECTIVE DATE
This Agreement shall be effective on the latest date on which this Agreement is executed by Anaheim (“Effective Date”).
[SIGNATURES ON FOLLOWING PAGE]
EXHIBIT A1
SCOPE OF SERVICES & SCHEDULE OF COMPENSATION
1. SCOPE AND PRICING
On an as-needed basis, Anaheim will submit orders to Contractor for any of the professional gas management services listed in Table 1 below and described further in Sections 2 through 4 of this Exhibit A, and Contractor will perform the services in compliance with all current requirements of the California Air Resources Board (“CARB”) and the U.S.
Environmental Protection Agency (“EPA”) for SF6 gas extraction, handling, and reporting as well as any new, applicable requirements that either agency promulgates during the Term of this Agreement. All work must be performed and equipment used/calibrated in accordance with California Code of Regulations (“CCR”) Title 17, sections 95350-95359.1.
Anaheim makes no commitment to order any minimum number/quantity of services during the Term of the Agreement; actual numbers/quantities of necessary services will vary.
TABLE 1
Description Price
Degassing and Disposal of Decommissioned Electrical Distribution Equipment Decontamination and Disposal of Gas Insulated Equipment, per each unit $150.60 SF6 Gas Disposal, per pound $5.40
Labor charges, per hour $262.00
Shipping and transportation of equipment to DILO facility At cost Other Service Charges
Gas recovery equipment rental, per week $4,100.30
EH&S Compliance fee due to different contractor compliance services, per project $300.00 Consolidation of SF6 between cylinders based on cylinder capacity, per cylinder $48.00 Recertification of customer owned steel cylinders, per cylinder $169.90
The Prices listed in Table 1 are subject to an annual 3.5 percent increase, commencing on the anniversary of the Effective Date and continuing for each year of the Term.
2. DEGASSING AND DISPOSAL OF DECOMMISSIONED ELECTRICAL
DISTRIBUTION EQUIPMENT
The Contractor is required to extract SF6 gas from decommissioned, high-voltage electrical equipment, such as distribution switches and substation circuit breakers. The equipment will be de-energized and staged at APU’s Edwards Utilities Complex, located in Anaheim.
1 Capitalized terms that are undefined herein have the meaning ascribed to them in the Agreement to which this Exhibit A is attached.
2 The Contractor must recover and recycle all SF6 gas extracted from APU’s electrical equipment in accordance with CARB and EPA requirements. After the gas has been extracted, the Contractor shall transport the equipment to an appropriately permitted facility for recycling or disposal. The Contractor shall provide a flatbed truck or similar vehicle to transport the equipment. Before the scheduled pickup, APU will provide the Contractor with a detailed list of decommissioned equipment.
3. OTHER PROFESSIONAL GAS SERVICES
The Contractor will perform other as-needed professional gas services, including:
• Testing the purity of SF6 gas in equipment or cylinders; • Consolidating SF6 gas between cylinders and disposing of unneeded cylinders; and • Conducting hydrostatic testing and other gas cylinder maintenance.
4. GENERATING DOCUMENTATION FOR CALIFORNIA AIR RESOURCES
BOARD COMPLIANCE
For all work performed, the Contractor will prepare reports that document the specific methods used during any gas-transfer operation in accordance with CARB regulations. The Contractor shall provide these reports within 30 days of completing the work. This includes, but is not limited to, documenting:
• All equipment serial numbers and APU identification number; • All gas containers’ unique identifiers;
• Whether SF6 gas is transferred into or out of a device; • The date of transfer;
• The quantity of transferred gas, using a calibrated scale or mass flow device; and • The temperature, pressure, and vacuum of equipment during the gas-transfer process.