AMENDMENT NO. 3 TO
EXCLUSIVE SOLID WASTE SERVICES
FRANCHISE AGREEMENT BETWEEN
THE CITY OF HAWAIIAN GARDENS,
WASTE RESOURCES INC. AND USA WASTE OF CALIFORNIA, INC.
THIS AMENDMENT No. 3 (“Amendment”) to the Exclusive Solid Waste Services Franchise Agreement is made and entered into this ____ day of October 2025, by and among the CITY OF HAWAIIAN GARDENS, a general law city and municipal corporation (“City”), WASTE RESOURCES, INC., a California corporation (“WRI”), WASTE RESOURCE TECHNOLOGIES, INC., (referred to herein as “WRT”) and USA WASTE OF CALIFORNIA, INC., a Delaware corporation (“WM”). The City, WRI, and WM may be referred to as a “Party” or collectively as the “Parties.”
RECITALS
A. City and WRI are parties to that certain Exclusive Solid Waste Services Franchise Agreement, dated July 1, 2018, by and between the City and Commercial Waste Services, Inc., as assigned by the City Resolution No. 111-2019 to WRI, as subsequently amended by that certain Amendment No. 1 to Exclusive Solid Waste Services Franchise Agreement, dated September 28, 2021 and Amendment No. 2 to Exclusive Solid Waste Services Franchise Agreement, dated October 11, 2022 (collectively, the "Agreement"), under which WRI provides solid waste disposal and/or other services to the City.
B. WRI and WM, through their affiliates and/or related entities, have entered into a proposed transaction that includes the acquisition of WRI’s assets. Specifically, WRT has entered into that certain Plan of Reorganization and Purchase and Sale Agreement, dated March 31, 2025 (the "Asset Purchase Agreement"), with Waste Management WRT Holdings, LLC, a Delaware limited liability company ("Waste Management WRT"), which contemplates the sale of the commercial, industrial and residential solid waste (including recycling material) collection and dumpster rental business of WRT and its subsidiaries (the "Transaction").
C. The Transaction would include the assignment of WRI’s interests in the Agreement, which assignment requires the consent of the City under the terms of the Agreement. WRI has requested the consent of the City to such assignment as part of the Transaction.
D. City has asserted that WRI is in default of the Agreement, and WRI is attempting to cure that default.
E. Upon the closing of the Transaction, the Parties wish to amend the Agreement to acknowledge the assignment of the Agreement to WM and make other modifications as set forth below.
AGREEMENT
NOW THEREFORE, inconsideration of the mutual promises contained herein, the above recitals, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:
SECTION 1. CONSENT TO ASSIGNMENT. Pursuant to Article 10, the City consents to the assignment of the Agreement from WRI to WM, effective upon the closing of the Transaction.
Until the closing of the Transaction, WRI shall continue to possess all of its right, title and interest in Attachment B
the Agreement and agrees to perform its obligations and liabilities under the Agreement. Upon the closing of the Transaction, WM assumes all rights, liabilities, title and interest in the Agreement and agrees to perform all obligations and liabilities due thereunder, including any past or current defaults.
WRI and WM shall provide City with written notice of the closing of the Transaction. WM agrees that amounts it pays to the current owners of WRI through or as part of the Transaction shall not be the basis for a request for any future Maximum Rate Schedule adjustment for performing services in the City pursuant to the Agreement.
SECTION 2. Article 2, Section 2.5, entitled “Franchise Term,” is hereby deleted and shall be replaced in its entirety with the following:
“2.5 Franchise Term
The term of the Agreement shall be for a period of seven (7) years, commencing on July 1, 2021, and expiring on June 30, 2028, unless terminated earlier pursuant to Article 9 of the Agreement, or otherwise.
On July 1, 2028, the Term shall automatically be extended for an additional three (3) year period to June 30, 2031, unless City determines, in its reasonable discretion, that there has been any form of non-performance of uncured service deficiency, as defined under Article 9 of the Agreement.
Notwithstanding the foregoing, in the event that the Annual Consumer Price Index Adjustment as set forth in Section 7.2.1 increases by no more than five (5) percent in each fiscal year beginning July 1, 2025 and ending June 30, 2027, the Term shall only be extended upon the mutual consent of both Parties.
Such consent shall be documented in a written amendment to this Agreement.” SECTION 3. RATE ADJUSTMENTS. Notwithstanding any language to the contrary in the Agreement, the rates in the Maximum Rate Schedule for services provided to Commercial and MultiFamily customers shall not increase by more than three and one-half percent (3.5%) per fiscal year for the time period from July 1, 2026 through June 30, 2028.
SECTION 4. Attachment G, entitled “Work Plan,” is hereby amended to read in full as set forth in the attached Exhibit 1, incorporated by this reference. On or before [March 1], 2026 and each [March] 1st thereafter, Franchisee shall provide an updated Work Plan for City’s review and approval, which shall not be unreasonably withheld or delayed. Upon approval, Attachment G shall be updated to reflect the updated Work Plan without further action by the Parties.
SECTION 5. WRI, in all capacities, and on behalf of its respective predecessors, successors, assigns, heirs, beneficiaries, personal representatives, agents, attorneys and representatives, hereby absolutely, forever and fully, generally and specifically, release, waive, discharge and relinquish any and all rights, entitlements, claims, demands, rights, debts, liabilities, obligations, accounts and causes of action of any nature whatsoever, up to the date of this Amendment, against the City under the Agreement or otherwise, (collectively, the “Released Claims”). WRI specifically acknowledges its understanding and agreement that, the releases and discharges contained in this Amendment extend to all of the aforementioned Released Claims, whether secured or unsecured, whether now known or unknown, whether now held or owned, or any time held or owned, whether suspected or unsuspected, whether foreseen or unforeseen, whether patent or latent, and whether or not previously asserted. Such acknowledgement of understanding and agreement is an essential and material term of this Agreement. Consequently, as a condition of this Amendment and in furtherance of the release provisions set forth in this Amendment, WRI expressly and voluntarily waives and relinquishes any and all rights and benefits conferred upon it by the provisions of Section 1542 of the Civil Code of the State of California and any similar statute in any other state, with respect to any of the matters described or set forth in this Amendment. Section 1542 of the Civil Code of California states in full:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT
THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR
HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.
SECTION 6. This Amendment shall be effective upon close of the Transaction, and WRI and WM shall provide City with written notice of this date. Within thirty (30) days after close of the Transaction, WRI or WM shall pay the City the sum of One Hundred Twenty-Five Thousand Dollars ($125,000) to reimburse City for its estimated cost associated with reviewing the Transaction and requested assignment. If the Transaction is not consummated for any reason, the City’s consent to assignment contained in Section 1 shall be null and void and this Amendment will cease to have effect and the Agreement will remain in place between WRI and the City, in accordance with its terms.
SECTION 7. As among WRI and WM and their respective affiliates, including the Purchaser, the other Seller Parties and the Significant Stockholders (each of Purchaser, Seller Parties and Significant Stockholders as defined in the Asset Purchase Agreement), nothing in this Amendment No. 3 shall be deemed to limit, amend, modify, or restrict any terms of the (i) Asset Purchase Agreement, (ii) the Significant Stockholder Agreements or (iii) any other Ancillary Agreement, as each of (ii) and (iii) are defined in the Asset Purchase Agreement, including, without limitation, any indemnification or guarantee obligations (with respect to Retained Liabilities or otherwise) thereunder.
SECTION 8. This Amendment may be executed in any number or counterparts, each of which will be an original, but all of which together constitute one instrument executed on the same date. Signatures on PDF copies thereof shall be deemed original signatures for all purposes and such PDF copies shall be admissible as evidence of the agreement in any and all administrative or judicial proceedings. This Amendment shall be governed by, and interpreted and enforced under, the laws of the State of California, without giving effect to conflict of laws principles. Venue shall be as provided for in the Agreement, which provision is incorporated by reference.
SECTION 9. Any notices required to be given under this Amendment No. 3 shall be in writing and may be personally delivered, sent by nationally recognized overnight courier, delivered by electronic means with proof of receipt, or sent by registered or certified mail, postage prepaid, return receipt requested and shall be effective upon receipt at the appropriate address. Any notice given to the City, WRI or WM shall be sent to the respective address set forth below:
City of Hawaiian Gardens
21815 Pioneer Blvd.
Hawaiian Gardens, CA 90716
Attn: City Manager
Waste Resources, Inc.
23 Corporate Plaza, Suite 247
Newport, CA 92660
Attn: Paul A. Wolfe
USA Waste of California, Inc.
2255 N. Ontario Street, Suite 350
Burbank, CA 91504
Attn: President – Southern California Area
SECTION 10. Except as modified by this Amendment, all other terms and conditions of the Agreement remain the same.
[signatures on following page]
65320.00004\44309481.2
65320.00004\44291037.1
IN WITNESS WHEREOF, the Parties hereto have executed this Amendment No. 3 on the day and year first hereinabove written.
“CITY” “WRI”
CITY OF HAWAIIAN GARDENS WASTE RESOURCES, INC.
By: __________________________ By: ________________________ Ernesto Marquez Paul A. Wolfe
City Manager President
“WRT”
WASTE RESOURCES
TECHNOLOGIES, INC.
By : ________________________
[NAME]
[TITLE]
ATTEST: “WM”
USA WASTE OF CALIFORNIA, INC.
By: ________________________ By: ________________________ Pablo Ruiz, City Clerk Michael Hammer
President-Southern California Area
APPROVED AS TO FORM:
By: ________________________
Norma Tabares, City Attorney
65320.00004\44309481.2
65320.00004\44291037.1
Exhibit 1
[Work Plan]