Roseville City Council
November 5, 2025

Revised Scope:
 Services in connection with Schematic Design, Development, Construction Documents and Construction Administration
Services in connection with the addition of Boiler Replacement, Chiller Replacement and Cooling Tower Replacement.

Revised Services Scope:
 Structural Engineer
 Mechanical Engineer
 Electrical Engineer
 19six
$ 14,510
$ 53,112
$ 26,014
$ 7,055
Sub Total $ 100,691

3.1-04 Access Compliance Upgrades at Main Entrance, Parking, and Landscaping
Proposal Scope:
 Modifications to the existing plaza, car park or accessible path of travel were not anticipated.

Revised Scope:
 Services in connection with Schematic Design, Development, Construction Documents and Construction Administration
Services in connection with modifications to the existing car park or accessible path of travel were not anticipated.
 Drawing Exhibit Reference: A0.0 Site Plan
Revised Services Scope:
 Surveyor - Refer to Wood Rogers Extra Work Authorization letter dated May 28, 2025.

Task 4.00 – Phase 3 Topographic Survey
 Civil Engineer - Refer to Wood Rogers Extra Work
Authorization letter dated May 28, 2025.

T
ask 4.01a – Phase 3 Base File Preparation
Task 4.03 – Phase 3.1 Design Development
Task 4.04 – Phase 3.1 Construction Documents
Task 4.05 – Phase 3.1 Construction Administration
 19six
$
3,965
$ 49,990
$ 22,015
Sub Total $ 75,970

3.1-05 Additional Areas Added to Tenant Improvement Scope Proposal Scope:
 Tenant Improvements scope based on areas of Tenant
Improvements noted in RFP Exhibit
Revised Scope:
 Scope increase to areas of Tenant Improvements
 Services in connection with Schematic Design, Development, Construction Documents and Construction Administration
Services.
 Drawing Exhibit Reference: A0.0 Site Plan, A1.1 First Floor Plan,

A1.2 Second Floor Plan
Revised Services Scope:
 Mechanical Engineer
 Electrical Engineer
 19six
$ 27,658
$ 34,584
$ 32,810
Sub Total $ 95,052

3.1-06 Add replacement of Exterior CMU Wall Veneer with Plaster Finish (Men’s and Women’s Restrooms)
Proposal Scope:
 Schematic Design, Development, Construction Documents and Construction Administration Services in connection with replacement of Exterior Restroom CMU Wall Veneer with Plaster Finish at Owners request.

Revised Scope:
 Add services in connection with Design Development,
Construction Documents, Agency Approvals, Bidding and
Construction Administration Services with Expansion of the Building.

Areas of expansion to based on drawings A102 (Second Floor Plan) and Axxx (Exterior Elevations) , attached.
 Drawing Exhibit Reference: A1.2 First Floor Plan
Revised Services Scope:
 Structural Engineer
 19six
$ 4,695
$ 8,335
Sub Total $ 13,030

3.1-07 Increased Cost Estimating Services Scope
Proposal Scope:
 Tenant Improvements scope based on areas of Tenant
Improvements noted in RFP Exhibit
Revised Scope:
 Scope increase to areas of Tenant Improvements
 Services in connection with Design Development and
Construction Documents
 Drawing Exhibit Reference: A0.0 Site Plan, A1.1 First Floor Plan, A1.2 Second Floor Plan
Revised Services Scope:
 Cost Estimator $ 29,100

Sub Total $ 29,100
P
hase 3.1 - Mark-up on Consultants $
36,544
Total Phase 3.1 – Tenant Improvements $337,900 $ 421,217 $ 759,117

PHASE 3.2 – EXISTING BUILDING EXPANSION
(Building Additions)
Previous
Fee
Amendment
Fee
Revised Fee

3.2-01 Architectural Design Budget Exceeded
Proposal Scope:

Revised Scope:
 Initial budget for this task has been exceeded based upon the requests made by the City of Roseville for multiple iterations of plans and elevations.

Revised Services Scope:
 19six $ 23,440
Sub Total $ 23,440

3.2-02 Building Additions - Add Design Development, Construction Documents, Agency Approvals, Bidding and Construction
Administration Services
Proposal Scope:
 Included preparation of Conceptual level space plans for 1) Each floor of the existing Police Department building and 2) Space plans for the potential Additions / Expansion areas.  Schematic Design, Development, Construction Documents and Construction Administration Services in connection with Expansion of the Building were not included in original scope Revised Scope:
 Add services in connection with Design Development,
Construction Documents, Agency Approvals, Bidding and
Construction Administration Services with Expansion of the Building.
 Drawing Exhibit Reference: A0.0 Site Plan, A1. 0 Basement Floor Plan, A1.1 First Floor Plan, A1.2 Second Floor Plan
Revised Services Scope:
 Structural Engineer
 Mechanical Engineer
 Electrical Engineer
 19six
$ 117,130
$ 39,382
$ 36,102
$ 120,410
Sub Total $ 313,024

3.2-03 Increased Cost Estimating Services Scope
Proposal Scope:
 Cost Estimating Services included Schematic Design
only.

Revised Scope:
 Scope increase to include areas of Building Expansions  Services in connection with Design Development and
Construction Documents
 Drawing Exhibit Reference: A0.0 Site Plan, A1.1 First Floor Plan,

A1.2 Second Floor Plan
Revised Services Scope:
 Cost Estimator $
28,100
Sub Total $ 28,100
P
hase 3.1 - Mark-up on Consultants $
33,107
Total Phase 3.2 – Existing Building Additions (Expansion) $ 69,700 $ 374,231 $ 443,931 Amendment 1 total = $879,511

City Council
Communication
Meeting Date: 11/5/2025
Item #: VII.13
File #: 0800-02 & 0201-01
Item ID: 2025-748

Title: Backflow Program Technology Project - Budget Adjustment Contact: Rachel Tooker 916-746-1712 [email protected]

SUMMARY
Staff recommends approval of a budget adjustment in the amount of $245,000 for Information Technology Department secondary labor costs to complete integrations and upgrades to the City’s asset management and billing systems for cross-connection control and backflow prevention program compliance. Funding is available in the Water Operations Fund.

RECOMMENDATION
Staff recommends that City Council adopt an ordinance to approve a $245,000 budget adjustment in the Water Operations Fund to the Backflow Program Technology Project for IT secondary labor costs to update existing technology systems for cross-connection control and backflow prevention compliance.

BACKGROUND
The State Water Resources Control Board (SWRCB) recently issued a new Cross-Connection Control Policy Handbook that updates previous regulations in California Code of Regulations Title 17. It contains enforceable standards that apply to all California Public Water Systems. The City submitted a written Cross-Connection Control Plan in June 2025 to the SWRCB, which has been approved.

The Water Utility is restructuring program operations and leveraging technology to manage backflow prevention and cross-connection control in accordance with the state’s updated policies. There are increased expectations for hazard assessments, program enforcement, record-keeping, backflow tester and cross-connection specialist certifications, customer communications, backflow incident response, public education, and state reporting. There are also tight timelines for correction of failed backflow assemblies, which will require a more robust system for communicating with backflow owners and keeping contact information updated.

The Water Utility has been partnering with the City’s IT Department to upgrade existing systems to support these changes. At the time of FY 2025-26 budgeting, the work had not been scoped completely since the full extent of operational changes required to meet the updated regulations were still being worked out.

The recommended budget adjustment includes $67,000 for IT scoping costs and $178,000 for IT secondary labor costs to complete upgrades to the City’s asset management system and integrate with the utility billing system.

FISCAL IMPACT
The recommended budget adjustment appropriates $245,000 in the Water Operations Fund to the Backflow Program Technology Project budget, increasing the total project budget to $551,650. There are adequate resources in the fund for this expenditure increase.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and §15378.

Approval of a budget adjustment meets the above criteria and is not subject to CEQA. No additional environmental review is required.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS

1. Ensure a safe and healthy community

2. Remain fiscally responsible in a changing world

4. Invest in well-planned infrastructure and growth

6. Deliver exceptional City services

Respectfully Submitted,
Rachel Tooker, Environmental Utilities Compliance Administrator

Sean Bigley, Environmental Utilities Director

ATTACHMENTS:

1. Ordinance 7008

REVIEWERS:

Rachel Tooker, Environmental Utilities Department Created/Initiated - 10/8/2025 George Hanson, Environmental Utilities Department - Water Approved - 10/15/2025 Devin Whittington, Environmental Utilities Department Approved - 10/15/2025 Sean Bigley, Environmental Utilities Department Approved - 10/16/2025 Kelly Aye, City Attorney Department Approved - 10/20/2025 Katrina Six, City Clerk Department Approved - 10/22/2025 Ryan DeVore, City Clerk Department Approved - 10/22/2025 Dennis Kauffman, City Manager Department - Assistant City Manager Approved - 10/22/2025 Michelle Sheidenberger, City Attorney Department Approved - 10/23/2025 Dominick Casey, City Clerk Department Approved - 10/27/2025 Katrina Six, City Clerk Department Final Approval - 10/27/2025

ORDINANCE NO. 7008

ORDINANCE OF THE COUNCIL OF THE CITY OF ROSEVILLE
AUTHORIZING CERTAIN AMENDMENTS TO THE FISCAL YEAR 2025-26

BUDGET AND DECLARING THIS ORDINANCE TO BE IMMEDIATELY

EFFECTIVE AS AN APPROPRIATION MEASURE

THE CITY OF ROSEVILLE ORDAINS:

SECTION 1. The City of Roseville Annual Budget, Fiscal Year 2025-26, is hereby amended as listed on the attached budget adjustment for the Backflow Program Technology project.

SECTION 2. This ordinance is hereby declared to be an appropriation measure, immediately effective pursuant to the provisions of Section 5.03 of the Charter.

SECTION 3. The City Clerk is hereby authorized and directed to post a true copy of the foregoing ordinance in each of three (3) conspicuous locations in the City and she shall immediately after such posting enter in the ordinance book, under the record of the ordinance, a certificate under her hand stating the time and place of such publication by posting.

PASSED AND ADOPTED by the Council of the City of Roseville, this day of , 2025, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:

MAYOR
ATTEST:

City Clerk

REQUEST FOR BUDGET ADJUSTMENT
Updated 07/03/2025

Please complete the cells highlighted in yellow.

REQUESTER NAME & TITLE: FISCAL YEAR:

PREPARER NAME & TITLE: ORDINANCE:

DEPARTMENT/DIVISION:

EXPENDITURES/EXPENSES/TRANSFERS OUT
ACCOUNT STRING BUDGET ($)
Fund Account Center Project Adjustment DESCRIPTION
6101 5080 84001 500346 245,000 Increase Capital Outlay - Project 500346 Backflow Program Technology Project

EXPENDITURES/EXPENSES/TRANSFERS OUT TOTAL 245,000

REVENUES/TRANSFERS IN
ACCOUNT STRING BUDGET ($)
Fund Account Center Project Adjustment DESCRIPTION

REVENUES/TRANSFERS IN TOTAL -

NET ADJUSTMENT 245,000

FUND BALANCE
ACCOUNT STRING BUDGET ($)
Fund Account Center Project Adjustment DESCRIPTION
6101 3601 00000 000000 (245,000) Decrease Water Operations Fund Balance 3601 00000 000000
3601 00000 000000
3601 00000 000000
3601 00000 000000
3601 00000 000000
FUND BALANCE TOTAL (245,000)

Justification for Budget Adjustment:

Additional funds are needed to complete the Backflow Program Technology Project (500346) due to unanticipated increases in IT labor required for implementation. This budget adjustment will increase the project budget by $245,000 bringing the total project budget to $551,650 using available funds in the Water Operations Fund (6101).
2025-26Rachel Tooker, EU Compliance Administrator
Joseph Barrow, EU Business Analyst
EU/Water

City Council
Communication
Meeting Date: 11/5/2025
Item #: VII.14
File #: 0800-02
Item ID: 2025-762

Title: SB 1383 Compliance – Professional Services Agreement Contact: Michelle White 916-774-5774 [email protected]

SUMMARY
Staff recommends approval of a professional services agreement with SMART Compliance for the procurement of solid waste compliance software, two field printers, and up to 100 hours of software customization. These services are needed to streamline regulatory compliance and to effectively manage programs, documents, and operations. The contract cost of $110,500 is included in the FY2025-26 Waste Services Operations Fund budget and is funded by the CalRecycle Local Assistance Grant.

RECOMMENDATION
Staff recommends City Council adopt a resolution to approve a professional services agreement with SMART Compliance and authorize the City Manager to execute the agreement on behalf of the City of Roseville.

BACKGROUND
Senate Bill (SB) 1383 established statewide requirements to reduce organic waste disposal and mandated extensive local government recordkeeping and reporting across collection, food recovery, outreach, procurement, capacity planning, waivers, and enforcement programs. To meet these requirements, Environmental Utilities staff initially developed an internal organic tracking module within the City’s existing utility billing system. While this tool provided short-term support, staff identified the need for a more comprehensive solid waste compliance software platform to streamline tracking, reporting, and regulatory documentation.

After evaluating multiple software systems, staff determined that SMART Compliance offered the most effective compliance-focused solution. SMART Compliance was recently selected through a competitive procurement by Zero Waste Sonoma, and staff confirmed that this procurement was authorized to be utilized through the City’s cooperative purchasing (piggyback) ordinances. SMART Compliance’s platform will provide a centralized system for managing the City’s solid waste regulatory compliance, data collection, and reporting obligations under SB 1383. It integrates all required recordkeeping functions, including tracking of generator data, waivers, service levels, inspections, enforcement actions, and outreach and education activities.

The system also includes a comprehensive enforcement module with customizable inspection forms, violation templates, and route review tools that support contamination monitoring and provide actionable insights to enhance organics diversion programs. Together, these features will significantly reduce manual data entry, eliminate redundancies, and strengthen the City’s ability to meet state regulatory requirements.

This contract also includes two field printers and up to 100 hours of software customization to align the system with Roseville’s operational and reporting needs. The total cost of $110,500 is included in the

FY2025–26 Waste Services Operations Fund budget and will be funded by CalRecycle’s SB 1383 Local Assistance Grant (Cycle OWR4). Grant funds must be expended by November 2026, and implementing the software now will ensure timely compliance with upcoming CalRecycle Jurisdiction and Agency Compliance and Enforcement (JACE) reviews.

FISCAL IMPACT
The total contract cost of $110,500 is included in the FY2025–26 Waste Services Operations Fund budget.

The project will be fully funded through the CalRecycle Local Assistance Grant (Cycle OWR4), which provides dedicated funding to support implementation of SB 1383 regulatory requirements.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) only applies to projects which have the potential to cause a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. (CEQA Guidelines §15061(b)(3)).

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS

4. Invest in well-planned infrastructure and growth

6. Deliver exceptional City services

Respectfully Submitted,
Michelle White, Environmental Utilities Compliance Administrator

Sean Bigley, Environmental Utilities Director

ATTACHMENTS:

1. Resolution 25-344

2. Agreement

REVIEWERS:

Michelle White, Environmental Utilities Department - Solid Waste Created/Initiated - 10/15/2025 Devin Whittington, Environmental Utilities Department Approved - 10/15/2025 Sean Bigley, Environmental Utilities Department Approved - 10/16/2025 Gretchen Hakala, City Clerk Department Approved - 10/16/2025 Kelly Aye, City Attorney Department Approved - 10/21/2025 Katrina Six, City Clerk Department Approved - 10/22/2025 Ryan DeVore, City Clerk Department Approved - 10/22/2025 Dennis Kauffman, City Manager Department - Assistant City Manager Approved - 10/23/2025 Michelle Sheidenberger, City Attorney Department Approved - 10/24/2025 Dominick Casey, City Manager Department - City Manager Approved - 10/27/2025 Katrina Six, City Clerk Department Final Approval - 10/27/2025

RESOLUTION NO. 25-344

APPROVING A PROFESSIONAL SERVICES AGREEMENT, BY AND BETWEEN THE

CITY OF ROSEVILLE AND SMART COMPLIANCE, AND AUTHORIZING THE CITY

MANAGER TO EXECUTE IT ON BEHALF OF THE CITY OF ROSEVILLE

WHEREAS, a professional services agreement for SB 1383 Compliance, by and between the City of Roseville and Smart Compliance, has been reviewed by the City Council; and

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Roseville that said professional services agreement is hereby approved and that the City Manager is authorized to execute it on behalf of the City of Roseville.

PASSED AND ADOPTED by the Council of the City of Roseville this ___ day of ______________, 2025, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:

______________________________
MAYOR

ATTEST:

________________________
City Clerk

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx.10/07/2025]

PROFESSIONAL SERVICES AGREEMENT
Project: SB 1383 Compliance
THIS AGREEMENT is made and entered into this ___ day of ________________, 20__, by and between the City of Roseville, a municipal corporation (“CITY”), and Smart Compliance, a California corporation (“CONSULTANT”); and
W I T N E S S E T H:

WHEREAS, CITY desires professional services consisting of software tracking for the collection of pertinent information and data required for SB 1383 tracking and reporting; and WHEREAS, CONSULTANT has prepared a proposal dated September 5, 2025, which describes the scope of work to be performed by CONSULTANT, the budget for the work, and the schedule for performance of the work; and
WHEREAS, CONSULTANT is qualified and experienced to provide such professional services.

NOW, THEREFORE, the parties agree as follows:

1. Services. CONSULTANT shall perform, at the direction of CITY, the scope of services as described in EXHIBIT “A,” attached hereto and incorporated herein by this reference.

2. Compensation. For its services provided hereunder, CONSULTANT shall be compensated on a time and expense basis in accordance with the budget estimate as described in

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx.10.07.2025] 2 EXHIBIT “A”. Total compensation shall not exceed one hundred ten thousand, five hundred fifty dollars ($110,550).

CONSULTANT shall submit one monthly invoice for its services. Such invoices shall be delineated by task, the person performing the services, and the hourly rate, which shall be stated in time increments of not greater than one tenth (1/10) hours. CITY shall pay invoices within thirty (30) days after receipt, if the services specified in the invoice have been satisfactorily completed.

3. Indemnification. To the fullest extent allowed by law, CONSULTANT shall defend, indemnify, and save and hold harmless CITY, its officers, agents, employees and volunteers from any claims, suits or actions of every name, kind and description brought forth, or on account of, injuries to or death of any person (including but not limited to workers and the public), or damage to property, resulting from or arising out of CONSULTANT's willful misconduct or negligent act or omission while engaged in the performance of obligations or exercise of rights created by this Agreement, except those matters arising from CITY's sole negligence or willful misconduct. The parties intend that this provision shall be broadly construed.

CONSULTANT agrees to defend and indemnify CITY if, despite the parties intent and practice, any venue, agency, or court with competent jurisdiction determines that CONSULTANT and/or any of its agents, officers, employees, volunteers, independent contractors, or subcontractors, are characterized as employee(s) of CITY.

CONSULTANT’s responsibility for such defense and indemnity obligations shall survive the termination or completion of this Agreement for the full period of time allowed by

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 3 law. The defense and indemnity obligations of this Agreement are undertaken in addition to, and shall not in any way be limited by, the insurance obligations contained in this Agreement.

4. Insurance. CONSULTANT agrees to continuously maintain, in full force and effect, the following minimum policies of insurance during the term of this Agreement.

COVERAGE LIMITS OF LIABILITY
Workers’ Compensation Statutory
Commercial General Liability $1,000,000 each occurrence $2,000,000 aggregate
Personal Injury:
$1,000,000 each occurrence
$2,000,000 aggregate
Automobile Liability $1,000,000 combined single limit
Professional Liability (errors and $1,000,000 per claim omissions) $2,000,000 aggregate
a. Form. CONSULTANT shall submit a certificate evidencing such coverage for the period covered by this Agreement in a form satisfactory to Risk Management and the City Attorney, prior to undertaking any work hereunder. Any insurance written on a claims made basis is subject to the approval of Risk Management and the City Attorney. b. Additional Insureds. CONSULTANT shall also provide a separate endorsement form or section of the policy showing CITY, its officers, agents, employees and volunteers as additional insureds for each type of coverage, except for Workers’ Compensation and Professional Liability. Such insurance shall specifically cover the contractual liability of CONSULTANT. The additional insured coverage under the CONSULTANT’s policy shall be primary and noncontributory, as evidenced by a separate endorsement or section of the policy, and shall not seek contribution from CITY’s insurance or self-insurance. In addition, the

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 4 additional insured coverage shall be at least as broad as the Insurance Services Office (“ISO”) CG 20 01 Endorsement. Any available insurance proceeds in excess of the specified minimum insurance coverage requirements and limits shall be available to the additional insureds.

Furthermore, the requirements for coverage and limits shall be: (1) the minimum coverage and limits specified in this Agreement; or (2) the full coverage and maximum limits of any insurance proceeds available to the named insureds, whichever is greater. c. Cancellation/Modification. CONSULTANT shall provide ten (10) days written notice to CITY prior to cancellation or modification of any insurance required by this Agreement.
d. Umbrella/Excess Insurance. The limits of insurance required in this Agreement may be satisfied by a combination of primary and excess insurance. Any excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and noncontributory basis for the benefit of CITY (if agreed to in a written contract) before CITY’s own insurance shall be called upon to protect it as a named insured. e. Subcontractors. CONSULTANT agrees to include in its contracts with all subcontractors the same requirements and provisions of this Agreement, including the indemnity and insurance requirements, to the extent they apply to the scope of the subcontractor’s work.

Furthermore, CONSULTANT shall require its subcontractors to agree to be bound to CONSULTANT and CITY in the same manner and to the same extent as CONSULTANT is bound to CITY under this Agreement. Additionally, CONSULTANT shall obligate its subcontractors to comply with these same provisions with respect to any tertiary subcontractor, regardless of tier. A copy of CITY’s indemnity and insurance provisions will be furnished to the subcontractor or tertiary subcontractor upon request.

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 5 f. Self-Insured Retentions. All self-insured retentions (“SIR”) must be disclosed to Risk Management for approval and shall not reduce the limits of liability.

Policies containing any SIR provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named insured or CITY. CITY reserves the right to obtain a full certified copy of any insurance policy and endorsements. The failure to exercise this right shall not constitute a waiver of such right.
g. Waiver of Subrogation. CONSULTANT hereby agrees to waive subrogation which any insurer of CONSULTANT may acquire from CONSULTANT by virtue of the payment of any loss under a Workers Compensation, Commercial General Liability or Automobile Liability policy. All Workers Compensation, Commercial General Liability and Automobile Liability policies shall be endorsed with a waiver of subrogation in favor of CITY, its officers, agents, employees and volunteers for all worked performed by CONSULTANT, its employees, agents and subcontractors.
h. Liability/Remedies. Insurance coverage in the minimum amounts set forth herein shall not be construed to relieve CONSULTANT of liability in excess of such coverage, nor shall it preclude CITY from taking such other actions as are available to it under any other provisions of this Agreement or law.

5. Records. CONSULTANT and its subcontractors shall maintain all files and records relating to the services performed hereunder during the term of this Agreement and for a period of not less than one (1) year after the date of termination or expiration. Provided, however, that in the event of litigation or settlement of claims arising from the performance of this Agreement, CONSULTANT and its subcontractors shall maintain all files and records until such litigation, appeals or claims are resolved. Duly authorized representatives of CITY shall

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 6 have right of access during normal business hours and after reasonable notice to CONSULTANT’s and subcontractors’ files and records relating to the services performed hereunder and may review and copy the files and records at appropriate stages during performance of the services and during the one (1) year period following termination or expiration of this Agreement. CONSULTANT shall include this provision in its contracts with all subcontractors.

6. Time is of the Essence. Time is of the essence of this Agreement.

7. Prevailing Wages. When applicable, for purposes of this Agreement, CONSULTANT and its subcontractors shall comply with all applicable prevailing wage laws, e.g., but not limited to, California Labor Code Sections 1770 et seq. In accordance with said Section 1775, CONSULTANT shall forfeit as a penalty to the City two hundred dollars ($200) for each calendar day or portion thereof for each worker paid less than the prevailing rates for such work or craft in which such worker is employed for any work done on-site under the Agreement by CONSULTANT or by any subcontractor in violation of the provisions of the Labor Code and in particular, Labor Code Sections 1770 to 1780, inclusive. 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 worker for each calendar day or portion thereof for which each worker was paid less than the stipulated prevailing wage shall be paid to each worker by CONSULTANT or the applicable subcontractor.

Pursuant to the provisions of California Labor Code Section 1773, the contracting department has identified the source, stated below, of the general prevailing rate of wages applicable to the site to be done, for straight time, overtime, and holiday work. The holiday wage rate listed shall be applicable to all holidays recognized in the collective bargaining

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 7 agreement of the particular craft, classification or type of worker concerned. These wage rates may be obtained from the State Department of Industrial Relations and/or the following website address: http://www.dir.ca.gov/dlsr/DPreWageDetermination.htm.

Pursuant to Labor Code Section 1773.2, general prevailing wage rates set forth above, which forms a part of this Agreement, shall be posted by CONSULTANT at a prominent place at the work site. Prevailing wage rates to be posted at the work site will be furnished by the contracting department. The possibility of wage increases is one of the elements to be considered by CONSULTANT in determining its proposal and will not under any circumstances be considered as the basis of a claim against CITY or the Agreement.

8. Compliance with Laws. CONSULTANT shall comply with all federal, state and local laws, ordinances and policies as may be applicable to the performance of services under this Agreement.

9. Ability to Perform. CONSULTANT agrees and represents that it has the time, ability and professional expertise to perform the services required under this Agreement.

10. Public Contracts: Conflicts of Interest. CONSULTANT’s duties and services under this Agreement shall not include preparing or assisting CITY with any portion of the CITY’s preparation of a request for proposals, request for qualifications, or any other solicitation regarding a subsequent or additional contract with CITY. CITY shall at all times retain responsibility for public contracting, including with respect to any subsequent phase of this project. CONSULTANT’s participation in the planning, discussions, or drawing of project plans or specifications shall be limited to conceptual, preliminary, or initial plans or specifications.

CONSULTANT shall cooperate with CITY to ensure that all bidders for a subsequent contract on any subsequent phase of this project have access to the same information, including all

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 8 conceptual, preliminary, or initial plans or specifications prepared by CONSULTANT pursuant to this Agreement.

11. Governing Agreement. In the event of any conflict between this Agreement and its EXHIBITS, the provisions of this Agreement shall govern. In the event of any conflict between any of the EXHIBITS, the provisions of the first in order of attachment shall govern.

12. The Levine Act Disclosure. The Levine Act (Govt. Code, Section 84308) requires a Party (and its agent(s), if any) to a Proceeding before the City of Roseville that involves any action or consideration related to their contract, license, permit, or other entitlement for use, to disclose any campaign contributions made to CITY elected or appointed officers totaling more than $250 within the twelve (12) months prior to the CITY decision and while a proceeding is pending, and includes certain prohibitions on contribution activity thereafter. If applicable campaign contributions have been made by CONSULTANT and/or its agent(s), CONSULTANT is responsible for compliance, including for its disclosure obligations, if any, as further described at:
https://www.roseville.ca.us/government/departments/city_clerk/transparency/levine_act.

13. Assignment. CONSULTANT is employed to perform unique personal services.

CONSULTANT shall not assign this Agreement without the prior written consent of CITY.

CONSULTANT shall not employ or otherwise incur any obligation to pay other specialists or experts for services in connection with this Agreement, without prior written consent of CITY.

14. Independent Contractor. CONSULTANT, inclusive of its agents, officers, employees, volunteers, independent contractors, and subcontractors, shall act as an independent contractor, and covenants and agrees that it will conduct itself consistent with such status, that it

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 9 will neither hold itself out as, nor claim to be, an officer or employee of CITY by reason of this Agreement.

CONSULTANT and CITY agree that: (a) CONSULTANT is free from the control and direction of CITY in connection with the performance of the work; (b) CONSULTANT is providing services directly to CITY; (c) CONSULTANT has and will maintain at all relevant times a business license; (d) CONSULTANT maintains a business location that is separate from CITY; (e) CONSULTANT is customarily engaged in an independently established business of the same nature as that involved in the work performed hereunder; (f) CONSULTANT actually contracts with other businesses to provide the same or similar services and maintains a clientele without restrictions from CITY; (g) CONSULTANT advertises and holds itself out to the public as available to provide the same or similar services; (h) CONSULTANT provides its own tools, vehicles, and equipment to perform the services; (i) CONSULTANT has negotiated its own rates; (j) CONSULTANT set its own hours and location of work in accomplishing CITY’s on- call needs; and (k) CONSULTANT has the right to control the manner and means of accomplishing the result desired and exercises its own expert independent judgement.

15. Representations and Warranties. CONSULTANT warrants that it has not employed or retained any company or person, other than a bona fide employee working for CONSULTANT, to solicit or secure this Agreement, and that it has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift or any other consideration, contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, CITY shall have the right to terminate as void this Agreement, without liability, or, in its discretion, to deduct from the

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 10 Agreement price or consideration, or otherwise recover, the full amount of such fee, commission, percentage, brokerage fee, gift or contingent fee.

16. Successors in Interest. This Agreement shall be binding upon the heirs, successors, executors, administrators and assigns of the respective parties hereto.

17. Copyright, Ownership and Use of Materials. All tangible material (“Material”) created or delivered pursuant to this Agreement is considered a work made for hire under the Copyright Act. To the extent such Material does not qualify as a work made for hire, CONSULTANT hereby assigns to CITY all right, title, and interest, including but not limited to all copyrights, in all Material created by CONSULTANT in its performance under this Agreement. Material constitutes the scope of work outlined in Exhibit A and attached hereto, and all written and other tangible expressions, including but not limited to, drawings (including computer aided drawings), papers, documents, reports, surveys, renderings, exhibits, sketches, maps, models, prints, paintings or photographs, in any and all media or formats in which such materials have been created or are maintained. All Material furnished by CONSULTANT is, and shall remain, the property of CITY.

CONSULTANT shall execute any documents necessary to effectuate such assignment.

In the event that CONSULTANT uses, employs, designates, or retains any person or entity who is not an employee of CONSULTANT, to perform any work required of it pursuant to this Agreement, CONSULTANT shall require said person or entity to execute an agreement containing the preceding paragraph.

18. Termination of Agreement. The City may terminate this Agreement without cause by giving CONSULTANT ten (10) days advance written notice from the City Manager.

CONSULTANT may terminate this Agreement without cause by giving CITY thirty (30) days

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 11 advance written notice. In the event of termination through no fault of CONSULTANT, CITY shall compensate CONSULTANT for services performed as of the date of termination, upon the release to CITY of all Material hereunder, in any and all media or formats in which such materials have been created or are maintained. CITY retains the right to receive and use any Material, notwithstanding any termination or any dispute regarding the amount to be paid.

19. Attorney’s Fees; Venue; Governing Law. If either party commences any legal action against the other party arising out of this Agreement or the performance hereof, the prevailing party in such action shall be entitled to recover its reasonable litigation expenses, including but not limited to, court costs, expert witness fees, discovery expenses, and attorney’s fees. Any action arising out of this Agreement shall be brought in Placer County, California, regardless of where else venue may lie. This Agreement shall be governed by and construed in accordance with the laws of the State of California.

20. Modification. This Agreement and each provision contained herein may be waived, amended, supplemented or eliminated only by mutual written agreement of the parties.

21. Severability. If any of the provisions contained in this Agreement are for any reason held invalid or unenforceable, such holding shall not affect the remaining provisions or the validity and enforceability of the Agreement as a whole.

22. Notices. Any notices to parties required by this Agreement shall be delivered personally or mailed, U.S. first class postage prepaid, addressed as follows:

CITY OF ROSEVILLE CONSULTANT
Michelle White Judi Gregory
116 S. Grant Street 6625 N. Calle Eva Miranda, Ste. A
Roseville, CA 95678 Irwindale, CA 91702
Either party may amend its address for notice by giving notice to the other party in writing.

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] 12 23. Integrated Agreement. This is an integrated agreement and contains all of the terms, considerations, understanding and promises of the parties. It shall be read as a whole.

IN WITNESS WHEREOF, the City of Roseville, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attested to by its City Clerk under the authority of Resolution No. ______, adopted by the Council of the City of Roseville on the ___ day of ____________, 20__, and CONSULTANT has caused this Agreement to be executed.

CITY OF ROSEVILLE, a SMART COMPLIANCE, a California
municipal corporation corporation
BY: _______________________________ BY: _______________________________ DOMINICK CASEY its: _______________________________
City Manager
ATTEST:
and
BY: Robert W Hollis
its: Secretary
BY: _______________________________

CARMEN AVALOS
City Clerk
APPROVED AS TO FORM:

BY: _______________________________

MICHELLE SHEIDENBERGER
City Attorney
APPROVED AS TO SUBSTANCE:

BY: _______________________________

SEAN BIGLEY
Environmental Utility Director
Judi Gregory
CEO & President
Type text here
Devin Whittington on behalf of Sean Bigley

[B:\City Attorney\COUNCIL COMMUNICATIONS\smart psa.docx;10/07/2025] EXHIBIT “A”

1 S
MART1383 Proposal
Pr epared for
City of Roseville
Contact: Judi Gregory
[email protected]
855-724-1383 ext. 700

2 Table of Contents

4.1. Cover Letter and Corporate Information ............................................................ 3 Corporate Information ................................................................................................ 5

4.2. Technical Proposal ............................................................................................... 6 Experience ................................................................................................................... 7 Contact Team/Location ........................................................................................... 12 Technical Support Customer Service ...................................................................... 13 User Access ................................................................................................................ 15 Accessibility ................................................................................................................ 17 Quote .......................................................................................................................... 19 Data Uploads ............................................................................................................. 20

4.3. Insurance ............................................................................................................. 21 Proof of Insurance ..................................................................................................... 22

4.4. System Features .................................................................................................. 24

SMART Compliance, LLC
Learn More at SMART1383.com

3 4.1. Cover Letter and Corporate
Information

4 September 5, 2025

TO: City of Roseville

Thank you for the opportunity to provide a subscription quote for the SMART1383 Compliance System. The SMART1383 system allows for the convenient collection of pertinent information and data required for SB 1383 tracking and reporting. The system also
has several built-in features designed to assist with
outreach and inspection activities. SMART1383 alleviates many tedious and cumbersome tasks associated with spreadsheets and other data management systems; thereby streamlining operations and significantly reducing administrative time and effort .

If you have any questions, please feel free to contact us at 855-724-1383 ext 700, [email protected] or in writing at 6625 N Calle Eva Miranda, Suite A, Irwindale, CA 91702.

Sincerely,

Judi Gregory

5 Corporate Information

Corporate Name SMART Compliance

Address 6625 N Calle Eva Miranda, Suite A
Irwindale, CA 91702

Entity Type State of California General Stock Corporation

Officers Judi Gregory, CEO
Bob Hollis, CIO
Zane Harvey, CTO

Incorporated December 8, 2021
California

Federal Tax ID 87-3961734

6 4.2. Technical Proposal

7 Experience

SMART Compliance is a leading-edge company that specializes in providing sustainability intelligence systems and comprehensive compliance and reporting software as a service (SaaS). Our SB 1383 compliance software helps California communities easily navigate the complexities of reporting requirements. We are committed to helping jurisdictions, businesses, and organizations seamlessly integrate sustainability practices and metrics into their operations enabling them to meet regulatory compliance requirements and drive positive environmental and economic outcomes.

At Smart Compliance, our mission is to empower organizations with intelligent and innovative compliance solutions that foster trust, efficiency, and peace of mind. We are committed to being a reliable partner and helping jurisdictions, agencies, organizations, and businesses navigate the complex landscape of regulations and requirements with ease. Through our cutting-edge technology and expert insights, we strive to revolutionize the compliance experience, ensuring that our clients can focus on their core objectives while we handle their compliance data, analytics, and reporting needs.

Qualifications

SMART Compliance was founded by experts in the fields of solid waste & recycling, information technology, and computer science. Our team's extensive

8 understanding of California regulatory compliance coupled with in-field technical expertise, and time-saving technology and data tracking systems is unparalleled. SMART Compliance has a staff of nine, including five full-time programmers, data scientists, and data engineers.

The Technical Team is led by a CTO Zane Harvey who holds degrees in Physics, Mathematics, and Nuclear Engineering and who also serves as a Professor of Computer Science at Capitol Technology University in Washington DC where he teaches both undergraduate and graduate Computer Science, IT, and Artificial Intelligence courses. (may be a run on sentence) Zane has worked previously as an Engineer for a Fortune 500 Company and a US DOE Nuclear Laboratory and has spent the past 7 years in the Tech space with various companies including SMART Compliance Inc.

Judi Gregory is the CEO, overseeing both product development and business operations. With more than 35 years of experience in the solid waste and recycling industry, she brings deep, practical insight into the sector's evolving needs. Judi has served as both a board member and Executive Director of the California Resource Recovery Association, and her consulting firm delivers SB 1383 compliance services and technical assistance to numerous municipalities across California.

Our Chief Information Officer, Bob Hollis has a degree from Carnegie Mellon University, and graduated from the top ranked program in the United States for Information Systems. He has served as an elected public official, and as a board member of the California Resource Recovery Association and the National Recycling Coalition. Bob also served as a founding board member of the U.S.

9 Zero Waste Business Council, and has received awards from the California Resource Recovery Association (CRRA), Keep California Beautiful, and the California Product Stewardship Council for his work and contributions to our industry.

SMART Compliance was formed in 2021 and currently supports over seventy-five jurisdictions including several regional JPAs that use our SB1383 system for SB 1383 compliance, recordkeeping, and data tracking. Experience from serving multiple JPAs has allowed the SMART team to develop JPA tailored system customizations. These features are further explained in applicable areas of this proposal.

Managing Data Imports

SMART Compliance has developed a proprietary data extraction tool that allows us to extract existing data from any SB 1383 tracker. Using this method allows for seamless system set up regardless of the number of records, files, or photos contained in alternative systems. SMART can also easily import CSV, Excel, PDF, Excel, Word, and graphic files in mass uploads. SMART has an API that is available for integration with most data systems.

Our data integrity systems have been taught to use AI to help match accounts.

Each portal is trained on hauler specific data uploads and reporting information, alleviating time-consuming and inaccurate data uploads. A typical file import takes 24-48 hours from request.

10 Cybersecurity

Objective
Our approach to cybersecurity includes multi-layered defense systems, regular audits, and proactive monitoring to ensure platform reliability and data protection.

Threat Detection & Monitoring
• Real-time system monitoring via AWS CloudWatch and GuardDuty for anomaly detection and alerts.
• CrowdStrike Falcon deployed for advanced endpoint detection and response (EDR), offering behavioral threat analytics, malware prevention, and instant remediation.
• Annual third-party penetration testing and routine vulnerability scans. • Simulated incident response drills to ensure preparedness and validate protocols.

System Hardening
• Enforced least-privilege IAM policies.
• Critical server protections including IMDSv2, termination/stop protection, and automatic patching across AWS, Digital Ocean, and hosted services. • Web application security reinforced through Content Security Policy (CSP), X-Frame-Options, Referrer-Policy, CORS, and more.

Secure Access
• Optional IP whitelisting and SSH key-based authentication. • VPN usage encouraged for secure offsite access.

11 DoS & LFI Protection / Denial-of-Service (DoS) Mitigation • Web Application Firewall (WAF), request rate limiting, and timeout settings guard against attacks like Slowloris.
• Enhanced alerting for traffic anomalies and automated defensive triggers.

Local File Inclusion (LFI) Defense
• Hardened phpMyAdmin and backend scripts with strict input validation and sanitization.
• Code reviews and patching processes prevent file traversal and inclusion exploits.

Data Integrity & Privacy / Best Practices
• Input validation ensures accuracy and consistency across all stored records.
• Ongoing updates to key systems: WordPress, PHP, MySQL, cPanel, and operating system components.

Data Integrity & Privacy / Access Control & Audit Trails • Secure configuration of phpMyAdmin with restricted access, enforced authentication, and optional container isolation.
• Detailed logging for sensitive areas, including real-time alerts on unauthorized access or suspicious behavior.

12 Contact Team/Location

SMART Compliance takes a collaborative team approach to client and portal management. Our team meets daily to discuss projects and development. The following individuals will be assigned to assist with this contract; however, please know that every team member, including owners, will be involved with the day- to-day oversight and communications. This ensures that all clients receipt prompt feedback and resolution.

Contract Manager:

Judi Gregory, CEO [email protected]
Craig Stroud, Director of Sales &
Marketing [email protected]
Located in Southern CA

Primary Contact / Customer Success
Liaison/Training:

James Grunewald
[email protected] / Located in
Southern CA

Data Imports / Custom Dashboards:

Ryan Slattery [email protected]
Washington

Customer Support / Technical Issues:

Gareth Warren [email protected]
/ Pennsylvania (hours start @ 6AM PST)
Ryan Breiding / [email protected]

Additional Support:

Bob Hollis, CIO [email protected]
Zane Harvey, CTO
[email protected]
Daniel Armbruster,
[email protected]
Robert Reynolds, [email protected]
Nickolas Hessler
[email protected] / Located in
Southern CA (backup after 3PM)

13 Technical Support
Customer Service

At SMART Compliance, exceptional customer service and support are top priorities. Our customer service ticketing system ensures that all team members are promptly notified of incoming requests. With team members located in both Pacific and Eastern time zones, we provide support coverage from 6:00 AM to 6:00 PM PST. Most inquiries are resolved within two hours during business hours, and nearly all are addressed within 24 hours.

The Customer Success Liaison serves as the initial point of contact for support via email, phone, or virtual meetings. However, our entire team is actively engaged and available to connect directly with clients as needed. Although we are a technology provider, our deep roots in the solid waste industry give us a clear understanding of the critical nature of timely support, whether it’s assisting field staff with urgent technical issues or helping administrative teams meet tight deadlines. We pride ourselves on being responsive, reliable, and attentive to our clients' needs.

An exciting advancement within the Company is
the introduction of a SMART AI Agent SMARTbot—a
feature designed to assist users by answering common questions and

14 supplementing the User Manual. This AI-powered chatbot is trained on our internal documentation to ensure accurate, reliable support. In the future, the chatbot will also be enhanced with client-specific data to provide even greater value and personalization. In future iterations, SMARTbot will integrate jurisdiction-specific information enabling more tailored responses for staff and system users.

Additionally, we have developed the SMART AI Voice Agent, SMARTchat, which will offer users an alternative customer service touchpoint through voice interaction.

15 User Access

The SMART system provides unlimited user logins. Our system also allows for customizing user roles to meet the specific needs of our clients. Common user roles are as follows:

Jurisdiction Administrator:
• Access to all system features, including Waiver Admin. • Ability to add, edit, or remove users, or update user access. • Ability to permanently delete accounts.
• Ability to unlock submitted Notice of Violation and Citation actions.

Project Manager:
• Same permissions as Jurisdiction Administrator but cannot approve/deny waivers
Site Administrator:
• Access to all system features, excluding Waiver Admin. • Not able to add, edit, or remove users, or update user access. • Not able to permanently delete accounts.
• Not able to unlock submitted Notice of Violation and Citation actions.

Field Auditor:
• Access to field route review survey only
Field Administrator:
• Access to route review dashboard and surveys
CalRecycle
• Access only the Implementation Record for viewing purposes

16 Viewer
• Able to view but not edit any pages of the system.
• Can view and download reports

Tasklogger
• Can be assigned activities

Custom Roles
Any combination of customer roles can be configured
• View/edit only specific pages in the system
• View/edit only specific Implementation Record pages (such as purchasing records only)

Custom Portals
In addition to being able to create custom user roles, SMART can also be custom configured with specific portal data.

• Jurisdiction portal
o Data flows down from JPA portal to jurisdictions and jurisdiction data flows up to JPA portal
o Contains jurisdiction specific records, data, and reports. o Has its own Implementation Record
• Hauler portal
o Data flows down from JPA portal to hauler and hauler data flows up to JPA portal
o Contains specific records, data, and reports belonging to the hauler for all jurisdictions served in the JPA

17 Accessibility

Our compliance software is optimized for modern web browsers and functions reliably on Google Chrome, Mozilla Firefox, Microsoft Edge, and Safari. The platform has been tested across these browsers to ensure a consistent and responsive user experience for agency staff, haulers, and contractors. Our compliance software is designed and developed to meet or exceed WCAG 2.2 AA standards. The platform has been put through and passed a full VPAT by an independent third party. The results of the VPAT and additional accessibility information can be found here: https://smartcompliance.tech/accessibility/.

While we do not currently offer a standalone Android or iOS app for the Generator Manager the web application is fully responsive and performs well on tablets and larger smartphones, allowing users to access and manage records in the field.

Additionally, our platform includes ArcGIS Survey123-based field apps— compatible with both Android and iOS—for performing route reviews, inspections, and other field activities. These apps have been put through a full VPAT audit by ESRI. The apps have also been used for years in the field and integrate seamlessly with the main compliance tracking system. The Route Review App has been successfully used on a variety of tablets including Samsung and Apple to conduct thousands of route reviews across California.

Please note that although most core features are accessible via mobile

18 browsers, certain administrative functions—such as bulk data uploads, complex filtering, and full dashboard visualizations—are best performed on desktop or laptop devices due to interface complexity and screen size.

19 Quote

SERVICE 1-YEAR 3-YEAR 5-YEAR
One-time setup fee No Charge No Charge No Charge
Annual subscription rate* $24,500 $23,000 $20,000
Unlimited, permission specific
user logins Included Included Included
Up to 12 data imports/year No Charge No Charge No Charge Optional One-time: 2 Field
Printers ($1,250 ea) $2,500 $2,500 $2,500
Grant funding invoicing Included Included Included

OPTIONAL FEATURES
OPTIONAL: In Lieu of Jurisdictional
Implementation Records client
may substitute with 100 hours of
customization for non-standard
features.
$9,950 $9,000 $8,000
*Based on prepay of subscription.

20 Data Uploads

The SMART system supports both real-time data editing by authorized users and data imports via spreadsheets. Additionally, SMART offers an Application Programming Interface (API) that can be configured to integrate with most hauler billing or customer management systems.

We support monthly data uploads, typically processed within 24–48 hours of receipt. During the initial setup, a SMART Data Engineer will configure the system to interpret each hauler's dataset, including unique service level codes. Our AI- driven data integrity tools are designed to match accounts accurately and efficiently. Each client portal is tailored to handle hauler-specific data uploads and reporting requirements, significantly reducing the time and errors typically associated with revised datasets.

In between data uploads, authorized users can continue to update service level information in generator accounts. The SMART system logs every service level update, including the user who performed the changes, allowing for easy tracking of system changes.

Following each data upload, a list of terminated/removed accounts will be provided for verification. Additionally, all terminated accounts along with their complete data records and history are maintained and can be reactivated by any authorized user with one click.

21 4.3. Insurance

22 Proof of Insurance

The following page is a copy of SMART Compliance’s proof of insurance, demonstrating required proof of the required insurance as set forth in the Agreement. SMART Compliance confirms that prior to award of an Agreement; our firm shall furnish the AGENCY with Certificates of Insurance clearly evidencing all required insurance and endorsements.

Furthermore, SMART Compliance agrees to procure and maintain for the duration of the Agreement, insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder by SMART Compliance, its agents, representatives, employees or subcontractors.

24 4.4. System Features

25 System Features

SMART Solutions for All SB 1383 Requirements
SMART 1383 is designed to fully integrate all data and
recordkeeping functions for businesses and jurisdictions that manage solid waste programs. The system's base model
provides a robust platform for tracking all programmatic aspects of SB 1383.

26 Generator Manager

The Generator Manager (GM) is the central component of the SMART1383 System. It tracks all essential generator data, including tier and business types, waiver statuses, service levels, inspections, compliance records, enforcement actions, outreach and education efforts, and activity logs.

The GM interface features user-friendly, pre-designed forms, automated PDF templates, integrated photo/file storage, and SMART automation tools that streamline task management. All recorded information is automatically synced to the integrated Implementation Record, reducing redundancy and simplifying recordkeeping.

27 SMART 1383 is designed to fully integrate all data and recordkeeping functions for businesses and jurisdictions that manage solid waste programs. The system's base model
provides a robust platform for tracking all programmatic aspects of SB 1383.

Waiver Tracking

Waiver tracking is streamlined and efficient. Each waiver assessment is linked to a specific generator, with
recommendations automatically routed to authorized users for approval or denial.

Upcoming waiver expirations are clearly displayed on the KPI dashboard, helping users identify when reassessments are due. Field assessors can improve efficiency by leveraging “hotspot” features on data maps to prioritize their work.

All waiver-related data, including photos, files, and
automatically generated PDF documents, is securely stored in the generator profile and the Implementation Record for comprehensive historical tracking

28

29 Inspections & Enforcement

SMART1383 features a fully integrated compliance and
enforcement module. The system includes pre-designed,
customizable inspection forms, follow-up letters, notices of violation, and citation templates. It can operate as a standalone enforcement system or as a tool for tracking broader code enforcement activities.

The system supports integration of jurisdiction-specific municipal codes, including infractions and corrective actions. Jurisdictions can incorporate both SB 1383 regulations and local
environmental codes, enabling centralized tracking of all relevant compliance activities. Additionally, agencies can customize which documents are automatically recorded in the Implementation Record.

30

31 Edible Food Recovery

SMART1383 offers robust edible food recovery tracking to support efficient recordkeeping and capacity planning. Integrated mapping tools enable seamless GIS integration, helping food generators and recovery organizations connect more effectively.

An available API integration with Careit* further streamlines edible food tracking and documentation (*Careit subscription required).

32 Route Reviews

SMART1383 features a powerful route review system that
streamlines contamination tracking and provides jurisdictions with actionable insights to enhance recycling efforts. Integrated GIS mapping highlights contamination hot spots and identifies materials that should be prioritized in outreach and education campaigns.

The system automates the entire contamination monitoring process—including data collection, photo documentation, compliant record preparation, and generator education—into a single, efficient workflow.

Additionally, SMART1383 supports batch importing of third-party route review data, including integration with Zabble* (*Zabble subscription required).

33 Reporting and Analytics

SMART1383 simplifies the storage, analysis, and export of compliance data, giving users quick access to actionable insights. The system includes built-in dashboards and reporting tools that allow users to filter and visualize data by jurisdiction, hauler, or compliance category in real time. Interactive charts and graphs make it easy to identify trends, track progress, and pinpoint areas needing attention.

All generator data, inspection records, waiver decisions, and food recovery metrics can be exported in Excel-compatible formats for regulatory reporting or internal review. Whether managing SB 1383 implementation records, tracking edible food recovery efforts, or monitoring outreach activities, SMART1383 transforms complex datasets into clear, useful intelligence that supports timely decision-making and compliance reporting. makes storing, analyzing, and exporting data a snap.

SMART1383’s newest report is the annual program compliance report which performs a desk audit of compliance as required by the regulations.

34 Re

35 Implementation Recordkeeping and
Electronic Annual Reporting

One of the most notable features of SMART1383 is its ability to automatically record reportable data into the Implementation Record and Electronic Annual Report (EAR) sections. This significantly reduces the administrative burden of manual tracking and spreadsheet management.

The Implementation Record includes a dedicated CalRecycle view, displaying only the relevant system-generated records.

Each year, EAR data is compiled into a downloadable, user- friendly report that simplifies the completion of complex, required calculations.

36 Hauler Manager

SMART1383 has recently deployed a new feature designed to comprehensively track all organic waste haulers, including primary franchise haulers, third-party haulers, backhaulers, and self-haulers.

This system integrates with a jurisdiction’s formal licensing or permitting process but can also function as an ad hoc tool for jurisdictions that internally manage non-franchised organic haulers.

The Hauler Manager tracks a wide range of data, including hauler type, materials collected, collection methods, number and types of containers used, facilities utilized (linked to SWIS), and whether plastic or compostable bags are accepted. It also supports annual compliance inspections, logs communications and activities, and maintains hauler records and reporting history.

Data collected in the Hauler Manager automatically
prepopulates dropdowns in the Generator Manager and
contributes to Electronic Annual Reporting and Implementation Recordkeeping. This ensures that all required information is accurately included in reports with mandated data fields.

37

38

39 Tasks, Activities, and Scheduling

SMART1383 features a comprehensive Tasklogger that streamlines activity tracking, task assignment, and appointment scheduling.

This tool connects all users, creating a structured and efficient system for managing tasks and activities. Users can assign tasks to others, set due dates, upload files and photos, and update entries with follow-up details—all within user-friendly modals.

One of the latest enhancements is an appointment scheduler that automates email notifications and includes an “add-to- calendar” option. Coming in June 2025, a companion map will display both completed and open activities by type, with robust filtering capabilities.

Additionally, the Tasklogger tracks outreach activities and materials distribution, automatically calculating and integrating this data into the Electronic Annual Report (EAR) and
Implementation Record (IR) to support compliance reporting.

40 09

41 For inquiries, contact us.
[email protected]
855-724-1383 ext. 700

City Council
Communication
Meeting Date: 11/5/2025
Item #: VII.15
File #: 0709
Item ID: 2025-750

Title: Housing Inspection Services - Professional Services Agreement Contact: Kristine Faelz 916-774-5451 [email protected]

SUMMARY
Staff recommends approval of a professional services agreement with CSG Consultants for the purpose of providing Housing Inspection Services funded by Community Development Block Grant, Home Investment Partnerships Program, CalHome, and Building Equity and Growth in Neighborhoods (BEGIN) Program funds. The not-to-exceed amount per year is $20,000, while the total not-to-exceed maximum for the five- year contract term is $100,000. No General Fund resources will be used.

RECOMMENDATION
Staff recommends City Council adopt a resolution to approve a professional services agreement with CSG Consultants, Inc. for Housing Inspection Services, and authorize the City Manager to execute it on behalf of the City of Roseville.

BACKGROUND
The City utilizes federal funding from the Community Development Block Grant (CDBG) Program, Home Investment Partnerships Program (HOME), as well as State CalHome and Building Equity and Growth in Neighborhoods Program (BEGIN) funds to operate the Owner-Occupied Rehabilitation (OOR) Program.

This program provides 30-year, interest-free loans to low-income homeowners to address critical health, safety, accessibility, and code compliance home repairs. The OOR Program relies on building inspector expertise to scope repair work, monitor progress, and verify completion before approving payment.

Inspections are conducted to ensure that housing units meet safety standards and comply with applicable building codes.

On July 2, 2025, the City’s Housing Division issued a Request for Proposals (RFP) for Housing Inspection Services. Four firms responded:
• ArchRey Inc. – $90/hour
• CSG Consultants – $115/hour
• Development Compliance Solutions (DEVCOM) – $195/hour • Thurmond Consulting LLC – $150/hour

While ArchRey Inc. quoted the lowest rate, it is a single-person firm. Given the time-sensitive nature of rehabilitation projects, the City requires a team with sufficient backup staff to maintain project schedules.

CSG Consultants offered the second-lowest rate and demonstrated relevant experience, including a strong knowledge-base surrounding construction requirements relating to rehabilitating occupied homes, as well as awareness of federal requirements regarding lead-based paint and lead hazard reduction.

Staff recommends awarding the contract to CSG Consultants for Housing Inspection Services for the OOR Program. The contract will be for a term of five years and will not exceed $100,000.

FISCAL IMPACT
This contract for $100,000 will be funded using CDBG, HOME, CalHOME and BEGIN program funds. For the OOR program, expenses will be charged to the contract based on actual hours spent and will be charged as delivery costs of the programs for reimbursement. This item does not impact the General Fund.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) only applies to projects which have the potential to cause a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. (CEQA Guidelines §15061(b)(3)).

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS

1. Ensure a safe and healthy community

Respectfully Submitted,
Kristine Faelz, Housing Analyst

Melissa Anguiano, Economic Development Director

ATTACHMENTS:

1. Resolution 25-338

2. PSA Housing Inspection Services - CSG Consultants

REVIEWERS:

Kristine Faelz, Economic Development Department - Housing Created/Initiated - 10/10/2025 Trisha Isom, Economic Development Department - Housing Approved - 10/10/2025 Melissa Anguiano, Economic Development Department Approved - 10/13/2025 Gretchen Hakala, City Clerk Department Approved - 10/14/2025 Kelly Aye, City Attorney Department Approved - 10/21/2025 Katrina Six, City Clerk Department Approved - 10/22/2025 Ryan DeVore, City Clerk Department Approved - 10/22/2025 Dennis Kauffman, City Manager Department - Assistant City Manager Approved - 10/23/2025 Michelle Sheidenberger, City Attorney Department Approved - 10/23/2025 Dominick Casey, City Clerk Department Approved - 10/27/2025 Katrina Six, City Clerk Department Final Approval - 10/27/2025

RESOLUTION NO. 25-338

APPROVING A PROFESSIONAL SERVICES AGREEMENT, BY AND BETWEEN THE CITY OF ROSEVILLE AND CSG CONSULTANTS, INC., AND AUTHORIZING THE CITY

MANAGER TO EXECUTE IT ON BEHALF OF THE CITY OF ROSEVILLE

WHEREAS, a professional services agreement for housing inspection services, by and between the City of Roseville and CSG Consultants, Inc., has been reviewed by the City Council; and

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Roseville that said professional services agreement is hereby approved and that the City Manager is authorized to execute it on behalf of the City of Roseville.

PASSED AND ADOPTED by the Council of the City of Roseville this ___ day of ______________, 2025, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:

______________________________
MAYOR

ATTEST:

________________________
City Clerk

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025]

PROFESSIONAL SERVICES AGREEMENT
Housing Inspection Services

THIS AGREEMENT is made and entered into this ___ day of ________________, 20__, by and between the City of Roseville, a municipal corporation (“CITY”), and CSG Consultants, Inc., a California corporation (“CONSULTANT”); and

W I T N E S S E T H:

WHEREAS, CITY desires professional services consisting of housing inspection services for the CITY’s Owner Occupied Housing Rehabilitation Program; and WHEREAS, CONSULTANT has prepared a proposal in response to RFP #04-32 dated September 11, 2025, which describes the scope of work to be performed by CONSULTANT, the budget for the work, and the schedule for performance of the work; and WHEREAS, CONSULTANT is qualified and experienced to provide such professional services.

NOW, THEREFORE, the parties agree as follows:

1. Services. CONSULTANT shall perform, at the direction of CITY, the scope of services as described in EXHIBIT “A,” attached hereto and incorporated herein by this reference.

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 2 2. Compensation. For its services provided hereunder, CONSULTANT shall be compensated on a time and expense basis in accordance with the budget estimate as described in EXHIBIT “A”. Total compensation shall not exceed one hundred thousand dollars ($100,000).

CONSULTANT shall submit one monthly invoice for its services. Such invoices shall be delineated by task, the person performing the services, and the hourly rate, which shall be stated in time increments of not greater than one tenth (1/10) hours. CITY shall pay invoices within thirty (30) days after receipt, if the services specified in the invoice have been satisfactorily completed.

3. Indemnification. To the fullest extent allowed by law, CONSULTANT shall defend, indemnify, and save and hold harmless CITY, its officers, agents, employees and volunteers from any claims, suits or actions of every name, kind and description brought forth, or on account of, injuries to or death of any person (including but not limited to workers and the public), or damage to property, resulting from or arising out of CONSULTANT's willful misconduct or negligent act or omission while engaged in the performance of obligations or exercise of rights created by this Agreement, except those matters arising from CITY's sole negligence or willful misconduct. The parties intend that this provision shall be broadly construed.

CONSULTANT agrees to defend and indemnify CITY if, despite the parties intent and practice, any venue, agency, or court with competent jurisdiction determines that CONSULTANT and/or any of its agents, officers, employees, volunteers, independent contractors, or subcontractors, are characterized as employee(s) of CITY.

CONSULTANT’s responsibility for such defense and indemnity obligations shall survive the termination or completion of this Agreement for the full period of time allowed by

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 3 law. The defense and indemnity obligations of this Agreement are undertaken in addition to, and shall not in any way be limited by, the insurance obligations contained in this Agreement.

4. Insurance. CONSULTANT agrees to continuously maintain, in full force and effect, the following minimum policies of insurance during the term of this Agreement.

COVERAGE LIMITS OF LIABILITY

Workers’ Compensation Statutory

Commercial General Liability $1,000,000 each occurrence $2,000,000 aggregate
Personal Injury:
$1,000,000 each occurrence
$2,000,000 aggregate

Automobile Liability $1,000,000 combined single limit

Professional Liability (errors and $1,000,000 per claim omissions) $2,000,000 aggregate

a. Form. CONSULTANT shall submit a certificate evidencing such coverage for the period covered by this Agreement in a form satisfactory to Risk Management and the City Attorney, prior to undertaking any work hereunder. Any insurance written on a claims made basis is subject to the approval of Risk Management and the City Attorney. b. Additional Insureds. CONSULTANT shall also provide a separate endorsement form or section of the policy showing CITY, its officers, agents, employees and volunteers as additional insureds for each type of coverage, except for Workers’ Compensation and Professional Liability. Such insurance shall specifically cover the contractual liability of CONSULTANT. The additional insured coverage under the CONSULTANT’s policy shall be primary and noncontributory, as evidenced by a separate endorsement or section of the policy, and shall not seek contribution from CITY’s insurance or self-insurance. In addition, the

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 4 additional insured coverage shall be at least as broad as the Insurance Services Office (“ISO”) CG 20 01 Endorsement. Any available insurance proceeds in excess of the specified minimum insurance coverage requirements and limits shall be available to the additional insureds.

Furthermore, the requirements for coverage and limits shall be: (1) the minimum coverage and limits specified in this Agreement; or (2) the full coverage and maximum limits of any insurance proceeds available to the named insureds, whichever is greater. c. Cancellation/Modification. CONSULTANT shall provide ten (10) days written notice to CITY prior to cancellation or modification of any insurance required by this Agreement.
d. Umbrella/Excess Insurance. The limits of insurance required in this Agreement may be satisfied by a combination of primary and excess insurance. Any excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and noncontributory basis for the benefit of CITY (if agreed to in a written contract) before CITY’s own insurance shall be called upon to protect it as a named insured. e. Subcontractors. CONSULTANT agrees to include in its contracts with all subcontractors the same requirements and provisions of this Agreement, including the indemnity and insurance requirements, to the extent they apply to the scope of the subcontractor’s work.

Furthermore, CONSULTANT shall require its subcontractors to agree to be bound to CONSULTANT and CITY in the same manner and to the same extent as CONSULTANT is bound to CITY under this Agreement. Additionally, CONSULTANT shall obligate its subcontractors to comply with these same provisions with respect to any tertiary subcontractor, regardless of tier. A copy of CITY’s indemnity and insurance provisions will be furnished to the subcontractor or tertiary subcontractor upon request.

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 5 f. Self-Insured Retentions. All self-insured retentions (“SIR”) must be disclosed to Risk Management for approval and shall not reduce the limits of liability.

Policies containing any SIR provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named insured or CITY. CITY reserves the right to obtain a full certified copy of any insurance policy and endorsements. The failure to exercise this right shall not constitute a waiver of such right.
g. Waiver of Subrogation. CONSULTANT hereby agrees to waive subrogation which any insurer of CONSULTANT may acquire from CONSULTANT by virtue of the payment of any loss under a Workers Compensation, Commercial General Liability or Automobile Liability policy. All Workers Compensation, Commercial General Liability and Automobile Liability policies shall be endorsed with a waiver of subrogation in favor of CITY, its officers, agents, employees and volunteers for all worked performed by CONSULTANT, its employees, agents and subcontractors.
h. Liability/Remedies. Insurance coverage in the minimum amounts set forth herein shall not be construed to relieve CONSULTANT of liability in excess of such coverage, nor shall it preclude CITY from taking such other actions as are available to it under any other provisions of this Agreement or law.

5. Records. CONSULTANT and its subcontractors shall maintain all files and records relating to the services performed hereunder during the term of this Agreement and for a period of not less than one (1) year after the date of termination or expiration. Provided, however, that in the event of litigation or settlement of claims arising from the performance of this Agreement, CONSULTANT and its subcontractors shall maintain all files and records until such litigation, appeals or claims are resolved. Duly authorized representatives of CITY shall

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 6 have right of access during normal business hours and after reasonable notice to CONSULTANT’s and subcontractors’ files and records relating to the services performed hereunder and may review and copy the files and records at appropriate stages during performance of the services and during the one (1) year period following termination or expiration of this Agreement. CONSULTANT shall include this provision in its contracts with all subcontractors.

6. Time is of the Essence. Time is of the essence of this Agreement.

7. Prevailing Wages. When applicable, for purposes of this Agreement, CONSULTANT and its subcontractors shall comply with all applicable prevailing wage laws, e.g., but not limited to, California Labor Code Sections 1770 et seq. In accordance with said Section 1775, CONSULTANT shall forfeit as a penalty to the City two hundred dollars ($200) for each calendar day or portion thereof for each worker paid less than the prevailing rates for such work or craft in which such worker is employed for any work done on-site under the Agreement by CONSULTANT or by any subcontractor in violation of the provisions of the Labor Code and in particular, Labor Code Sections 1770 to 1780, inclusive. 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 worker for each calendar day or portion thereof for which each worker was paid less than the stipulated prevailing wage shall be paid to each worker by CONSULTANT or the applicable subcontractor.

Pursuant to the provisions of California Labor Code Section 1773, the contracting department has identified the source, stated below, of the general prevailing rate of wages applicable to the site to be done, for straight time, overtime, and holiday work. The holiday wage rate listed shall be applicable to all holidays recognized in the collective bargaining

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 7 agreement of the particular craft, classification or type of worker concerned. These wage rates may be obtained from the State Department of Industrial Relations and/or the following website address: http://www.dir.ca.gov/dlsr/DPreWageDetermination.htm.

Pursuant to Labor Code Section 1773.2, general prevailing wage rates set forth above, which forms a part of this Agreement, shall be posted by CONSULTANT at a prominent place at the work site. Prevailing wage rates to be posted at the work site will be furnished by the contracting department. The possibility of wage increases is one of the elements to be considered by CONSULTANT in determining its proposal and will not under any circumstances be considered as the basis of a claim against CITY or the Agreement.

8. Compliance with Laws. CONSULTANT shall comply with all federal, state and local laws, ordinances and policies as may be applicable to the performance of services under this Agreement.

9. Ability to Perform. CONSULTANT agrees and represents that it has the time, ability and professional expertise to perform the services required under this Agreement.

10. Public Contracts: Conflicts of Interest. CONSULTANT’s duties and services under this Agreement shall not include preparing or assisting CITY with any portion of the CITY’s preparation of a request for proposals, request for qualifications, or any other solicitation regarding a subsequent or additional contract with CITY. CITY shall at all times retain responsibility for public contracting, including with respect to any subsequent phase of this project. CONSULTANT’s participation in the planning, discussions, or drawing of project plans or specifications shall be limited to conceptual, preliminary, or initial plans or specifications.

CONSULTANT shall cooperate with CITY to ensure that all bidders for a subsequent contract on any subsequent phase of this project have access to the same information, including all

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 8 conceptual, preliminary, or initial plans or specifications prepared by CONSULTANT pursuant to this Agreement.

11. Governing Agreement. In the event of any conflict between this Agreement and its EXHIBITS, the provisions of this Agreement shall govern. In the event of any conflict between any of the EXHIBITS, the provisions of the first in order of attachment shall govern.

12. The Levine Act Disclosure. The Levine Act (Govt. Code, Section 84308) requires a Party (and its agent(s), if any) to a Proceeding before the City of Roseville that involves any action or consideration related to their contract, license, permit, or other entitlement for use, to disclose any campaign contributions made to CITY elected or appointed officers totaling more than $250 within the twelve (12) months prior to the CITY decision and while a proceeding is pending, and includes certain prohibitions on contribution activity thereafter. If applicable campaign contributions have been made by CONSULTANT and/or its agent(s), CONSULTANT is responsible for compliance, including for its disclosure obligations, if any, as further described at:
https://www.roseville.ca.us/government/departments/city_clerk/transparency/levine_act.

13. Assignment. CONSULTANT is employed to perform unique personal services.

CONSULTANT shall not assign this Agreement without the prior written consent of CITY.

CONSULTANT shall not employ or otherwise incur any obligation to pay other specialists or experts for services in connection with this Agreement, without prior written consent of CITY.

14. Independent Contractor. CONSULTANT, inclusive of its agents, officers, employees, volunteers, independent contractors, and subcontractors, shall act as an independent contractor, and covenants and agrees that it will conduct itself consistent with such status, that it

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 9 will neither hold itself out as, nor claim to be, an officer or employee of CITY by reason of this Agreement.

CONSULTANT and CITY agree that: (a) CONSULTANT is free from the control and direction of CITY in connection with the performance of the work; (b) CONSULTANT is providing services directly to CITY; (c) CONSULTANT has and will maintain at all relevant times a business license; (d) CONSULTANT maintains a business location that is separate from CITY; (e) CONSULTANT is customarily engaged in an independently established business of the same nature as that involved in the work performed hereunder; (f) CONSULTANT actually contracts with other businesses to provide the same or similar services and maintains a clientele without restrictions from CITY; (g) CONSULTANT advertises and holds itself out to the public as available to provide the same or similar services; (h) CONSULTANT provides its own tools, vehicles, and equipment to perform the services; (i) CONSULTANT has negotiated its own rates; (j) CONSULTANT set its own hours and location of work in accomplishing CITY’s on- call needs; and (k) CONSULTANT has the right to control the manner and means of accomplishing the result desired and exercises its own expert independent judgement.

15. Representations and Warranties. CONSULTANT warrants that it has not employed or retained any company or person, other than a bona fide employee working for CONSULTANT, to solicit or secure this Agreement, and that it has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift or any other consideration, contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, CITY shall have the right to terminate as void this Agreement, without liability, or, in its discretion, to deduct from the

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 10 Agreement price or consideration, or otherwise recover, the full amount of such fee, commission, percentage, brokerage fee, gift or contingent fee.

16. Successors in Interest. This Agreement shall be binding upon the heirs, successors, executors, administrators and assigns of the respective parties hereto.

17. Copyright, Ownership and Use of Materials. All tangible material (“Material”) created or delivered pursuant to this Agreement is considered a work made for hire under the Copyright Act. To the extent such Material does not qualify as a work made for hire, CONSULTANT hereby assigns to CITY all right, title, and interest, including but not limited to all copyrights, in all Material created by CONSULTANT in its performance under this Agreement. Material constitutes the scope of work outlined in Exhibit A and attached hereto, and all written and other tangible expressions, including but not limited to, drawings (including computer aided drawings), papers, documents, reports, surveys, renderings, exhibits, sketches, maps, models, prints, paintings or photographs, in any and all media or formats in which such materials have been created or are maintained. All Material furnished by CONSULTANT is, and shall remain, the property of CITY.

CONSULTANT shall execute any documents necessary to effectuate such assignment.

In the event that CONSULTANT uses, employs, designates, or retains any person or entity who is not an employee of CONSULTANT, to perform any work required of it pursuant to this Agreement, CONSULTANT shall require said person or entity to execute an agreement containing the preceding paragraph.

18. Termination of Agreement. The City may terminate this Agreement without cause by giving CONSULTANT ten (10) days advance written notice from the City Manager.

CONSULTANT may terminate this Agreement without cause by giving CITY thirty (30) days

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025] 11 advance written notice. In the event of termination through no fault of CONSULTANT, CITY shall compensate CONSULTANT for services performed as of the date of termination, upon the release to CITY of all Material hereunder, in any and all media or formats in which such materials have been created or are maintained. CITY retains the right to receive and use any Material, notwithstanding any termination or any dispute regarding the amount to be paid.

19. Attorney’s Fees; Venue; Governing Law. If either party commences any legal action against the other party arising out of this Agreement or the performance hereof, the prevailing party in such action shall be entitled to recover its reasonable litigation expenses, including but not limited to, court costs, expert witness fees, discovery expenses, and attorney’s fees. Any action arising out of this Agreement shall be brought in Placer County, California, regardless of where else venue may lie. This Agreement shall be governed by and construed in accordance with the laws of the State of California.

20. Modification. This Agreement and each provision contained herein may be waived, amended, supplemented or eliminated only by mutual written agreement of the parties.

21. Severability. If any of the provisions contained in this Agreement are for any reason held invalid or unenforceable, such holding shall not affect the remaining provisions or the validity and enforceability of the Agreement as a whole.

22. Notices. Any notices to parties required by this Agreement shall be delivered personally or mailed, U.S. first class postage prepaid, addressed as follows:

CITY OF ROSEVILLE CONSULTANT

Trisha Isom, Housing Manager Cyrus Kianpour, President 316 Vernon Street, Ste. 150 550 Pilgrim Drive
Roseville, CA 95678 Foster City, CA 94404

Either party may amend its address for notice by giving notice to the other party in writing.

terms, considerations, understanding and promises of the parties. It shall be read as a whole.

IN WITNESS WHEREOF, the City of Roseville, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attested to by its City Clerk , adopted by the Council of the City of Roseville onunder the authority of Resolution No. executed.

ATTEST:

APPROVED AS TO FORM:

APPROVED AS TO SUBSTANCE:

CITY OF ROSEVILLE, a
municipal corporation
CSG CONSULTANTS, INC., a
California corporation
, 20 , and CONSULTANT has caused this Agreement to be
12 [B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025]

23. Integrated Agreement. This is an integrated agreement and contains all of the the day of
BY:_____________________________

MICHELLE SHEIDENBERGER
City Attorney
BY:___________________

DOMINICK CASEY
City Manager
BY:_____________________________

MELISSA ANGUIANO
Economic Development Director
BY:___________________

CARMEN AVALOS
City Clerk
BY: / _
its: NourdinKhayata
Secretary
BY: X //its: Cyrus Kianpour
President
and ,

[B:\City Attorney\COUNCIL COMMUNICATIONS\CSG psa.docx;09/23/2025]

EXHIBIT “A”

2150 River Plaza Drive, STE #255
Sacramento, CA 95833
916.492.2275 phone
916.492.2276 fax
www.csgengr.com

SCOPE OF WORK
City of Roseville
FOR

HOUSING INSPECTION SERVICES
(RFP #04-31)
September 11 , 2 0 2 5

PROPOSAL FOR HOUSING INSPECTION SERVICES TO THE CITY OF ROSEVILLE

2150 River Plaza Drive, Suite #255, Sacramento, CA 95833 phone (916) 492-2275 | fax (916) 492-2276 | www.csgengr.com Scope of Work
September 11, 2025
Michelle Wurster
Housing Analyst
City of Roseville
311 Vernon Street
Roseville, CA 95678
Subject: Scope of Work for Housing Inspection Services (RFP 04-31) Dear Ms. Wurster,
Thank you for the opportunity for CSG Consultants to submit a scope of work for the City’s Housing Inspection Services RFP (04-31). We understand this agreement will have a $20,000 not-to-exceed amount per year, with a $100,000 5-year maximum. Our proposed staff offer a strong knowledgebase surrounding construction requirements as they relate to rehabilitating occupied homes. Furthermore, our staff have working knowledge of federal lead-based paint. lead hazard reduction, and other hazardous materials requirements (including Asbestos). Additional services our staff can provide the City under the Owner Occupied Housing Rehabilitation Program include:
 Interaction with non-profit services providers, contractors, and/or low-income homeowners  Tracking program and project timelines to ensure compliance with funding agency deadlines  Regular in-person coordination with other City employees and contract staff  Working collaboratively with the City’s Housing Manager and relevant Housing Analyst  Staff with knowledge of federal/state compliance requirements for HOME program  Staff with knowledge of state compliance requirements for CalHOME program  Timely and efficient allocation of both CDBG and HOME funds CSG offers the resources to partner with the City in its effort to address health, safety, and code issues to better the community of Roseville. James Jonte will perform inspections for the City and will work in concert with staff through successful implementation. No subconsultants will be utilized for this work, solely CSG staff.

Lee Holt, CCEO, will serve as the primary contact and project manager for this contract and will manage the code enforcement staff identified herein. Ms. Holt has over 25 years of public agency experience. Her contact information is as follows:

Lee Holt, CCEO | Code Enforcement Manager
(650) 522-2500 office | (650) 245-7122 cell | [email protected] email Please feel free to contact Ms. Holt with any questions or comments you may have. Our staff excel at working alongside City staff and residents to promote code compliance that allows communities to remain safe, healthy, and vibrant. We look forward to partnering with the City in this capacity, and to serving the community of Roseville together.

Sincerely,
Cyrus Kianpour, PE, PLS
President, CSG Consultants

SECTION
1

WWW.CSGENGR.COM
888.794.2016

CENTRAL COAST
• Paso Robles •

SOUTHERN CALIFORNIA
• Orange •

OFFICES

THROUGHOUT

CALIFORNIA

SAN FRANCISCO BAY AREA
• Foster City • San Jose • Pleasanton •

SACRAMENTO REGION
• Sacramento •

CENTRAL VALLEY
• Newman • Fresno •

City Council
Communication
Meeting Date: 11/5/2025
Item #: VII.16
File #: 0800-03
Item ID: 2025-752

Title: Purchase of Natural Gas - Base Contract
Contact: Patrick Zanardelli 916-774-5673 [email protected]

SUMMARY
Staff recommends approval of the North American Energy Standards Board (NAESB) Base Contract for Sale and Purchase of Natural Gas with ARM Energy Management LLC. Executing this NAESB Base Contract will expand Roseville’s pool of pre-approved natural gas counterparties, enhancing procurement flexibility during periods of market volatility. There is no cost associated with the execution of this contract, as these documents serve as enabling agreements.

RECOMMENDATION
Staff recommends that the City Council adopt a resolution authorizing the City Manager to execute the North American Energy Standards Board Base Contract for Sale and Purchase of Natural Gas with ARM Energy.

BACKGROUND
The City Council approved updated Electric Utility Risk Management Policies in May 2025. These policies require Roseville Electric Utility to manage the financial risks associated with providing electricity by limiting cost exposure through the procurement of fixed-price electricity and natural gas over a three-year planning horizon.

The North American Energy Standards Board (NAESB) is a nonprofit organization that develops and promotes standards for the wholesale and retail natural gas and electric industries across North America.

The NAESB Base Contract is the industry standard for physical natural gas transactions, providing a modular structure with customizable terms and supporting transaction-specific confirmations. The contract includes a “cover standard” for calculating damages and built-in credit protections, including the right to request collateral. The NAESB structure is consistent with industry practices, is aligned with Federal Energy Regulatory Commission (FERC) standards, and supports index-based pricing that is widely used by utilities, marketers, and producers.

Executing this NAESB Base Contract will expand Roseville’s pool of pre-approved natural gas counterparties, enhancing procurement flexibility during periods of market volatility. It will support streamlined, legally vetted transactions, reduce administrative burden, and lower execution risk. The agreement also positions the City to access more competitive pricing and maintain supply reliability, without obligating the City to transact or commit funds.

Any such transactions will remain subject to the City’s Energy Trading Authority Policy (Resolution No. 25- 149), approved by City Council on May 21, 2025.

FISCAL IMPACT

There is no fiscal impact associated with the execution of the NAESB Base Contract for Sale and Purchase of Natural Gas with ARM Energy, as these documents serve as enabling agreements. No transactions are currently pending between the parties under the NAESB framework. Any future transactions conducted under the agreement will be subject to the Roseville Electric Utility Energy Risk Management Policies and must comply with the Energy Trading Authority Policy.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and §15378.

Updates to the Energy Risk Policies are not considered a “project” as defined by CEQA and consequently no CEQA action is required.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS

2. Remain fiscally responsible in a changing world

Respectfully Submitted,
Patrick Zanardelli, Electric Business Analyst

Daniel Beans, Electric Utility Director

ATTACHMENTS:

1. Resolution 25-345

2. NAESB Base Contract between Roseville and Arm Energy

3. NAESB Special Provisions between Roseville and Arm Energy

4. Roseville - ARM Energy - Credit Support Annex

REVIEWERS:

Patrick Zanardelli, Electric Department - Customer & Government Relations and Financial & Administrative
Created/Initiated -
10/17/2025
Joanna Cucchi, Electric Department - Financial & Administrative Approved - 10/20/2025 Shawn Matchim, Electric Department - All Approved - 10/20/2025 Daniel Beans, Electric Department - All Approved - 10/20/2025 Kelly Aye, City Attorney Department Approved - 10/21/2025 Katrina Six, City Clerk Department Approved - 10/23/2025 Ryan DeVore, City Clerk Department Approved - 10/23/2025 Dennis Kauffman, City Manager Department - Assistant City Manager Approved - 10/23/2025 Michelle Sheidenberger, City Attorney Department Approved - 10/23/2025 Dominick Casey, City Manager Department - City Manager Approved - 10/27/2025 Katrina Six, City Clerk Department Final Approval -
10/27/2025

RESOLUTION NO. 25-345

APPROVING A BASE CONTRACT FOR SALE AND PURCHASE OF NATURAL GAS, BY

AND BETWEEN THE CITY OF ROSEVILLE AND ARM ENERGY MANAGEMENT LLC,

AND AUTHORIZING THE CITY MANAGER TO EXECUTE IT ON BEHALF OF

THE CITY OF ROSEVILLE

WHEREAS, the Base Contract for Sale and Purchase of Natural Gas, by and between the City of Roseville and ARM Energy Management LLC, has been reviewed by the City Council; and

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Roseville that said Contract is hereby approved and that the City Manager is authorized to execute it on behalf of the City of Roseville.

PASSED AND ADOPTED by the Council of the City of Roseville this ___ day of ______________, 2025, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:

______________________________
MAYOR

ATTEST:

________________________
City Clerk

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved September 5, 2006

Base Contract for Sale and Purchase of Natural Gas
This Base Contract is entered into as of the following date: September 24, 2025 The parties to this Base Contract are the following:

PARTY A
City of Roseville

PARTY NAME PARTY B
ARM Energy Management LLC

116 S. Grant Street
Roseville, CA 95678

ADDRESS

20329 State Highway 249
Floor 4
Houston, TX 77070

www.roseville.ca.us BUSINESS WEBSITE www.armenergy.com

CONTRACT NUMBER
164824240 D-U-N-S® NUMBER 07-860-9451
◼ US FEDERAL: 94-6000409
OTHER:

TAX ID NUMBERS
◼ US FEDERAL: 46-0648796

OTHER:

California JURISDICTION OF
ORGANIZATION Delaware
Corporation
LLC
Limited Partnership
Partnership
LLP ◼ Other: Municipality

COMPANY TYPE
Corporation ◼ LLC
Limited Partnership
Partnership
LLP
Other:

GUARANTOR
(IF APPLICABLE)
See Credit Support Provider in CSA

CONTACT INFORMATION
ACES, 4140 W. 99 Street, Carmel, IN 46032
ATTN: Gas Trading
TEL#: 317-344-7000 FAX#: 317-344-7001
EMAIL:
▪ COMMERCIAL

20329 State Highway 249, Floor 4, Houston, TX 77070
ATTN: Gas Desk
TEL#: 281-655-3200 FAX#: 281-664-0029
EMAIL: [email protected]
ACES, 4140 W. 99 Street, Carmel, IN 46032
ATTN: Gas Trading
TEL#: 317-344-7000 FAX#: 317-344-7001
EMAIL:
▪ SCHEDULING
20329 State Highway 249, Floor 4, Houston, TX 77070
ATTN: Gas Scheduling ___
TEL#: 281-655-3220 FAX#: 281-664-0029
EMAIL: [email protected]
City of Roseville
ATTN: Power Supply and Portfolio Administrator
TEL#: 916-774-5603 FAX#: 916-774-5583
EMAIL:
▪ CONTRACT AND

LEGAL NOTICES

20329 State Highway 249, Floor 4, Houston, TX 77070
ATTN: Contract Administration
TEL#: 281-655-3200 FAX#: 281-664-0029
EMAIL: [email protected]
City of Roseville
ATTN: Energy Risk Management
TEL#: 916-774-5510 FAX#:

EMAIL: [email protected]
▪ CREDIT
20329 State Highway 249, Floor 4, Houston, TX 77070
ATTN: Credit Department
TEL#: 281-655-3227 FAX#: 281-664-0029
EMAIL: [email protected]
ACES, 4140 W. 99 Street, Carmel, IN 46032
ATTN: Trading Control
TEL#: 317-344-7000 FAX#: 317-344-7099
EMAIL: [email protected]
▪ TRANSACTION

CONFIRMATIONS
20329 State Highway 249, Floor 4, Houston, TX 77070
ATTN: Confirmation Department
TEL#: 281-655-3200 FAX#: 281-664-0029
EMAIL: [email protected]

ACCOUNTING INFORMATION
City of Roseville
ATTN: Roseville Electric Settlements
TEL#: (916) 746-1135 FAX#:

EMAIL: [email protected]
▪ INVOICES
▪ PAYMENTS
▪ SETTLEMENTS
20329 State Highway 249, Floor 4, Houston, TX 77070
ATTN: Gas Accounting
TEL#: 281-655-3200 FAX#: 281-664-0029
EMAIL: [email protected]
BANK: U.S. Bank
ABA: 121122676 ACCT: 153499281092
OTHER DETAILS:

WIRE TRANSFER

NUMBERS
(IF APPLICABLE)
BANK: First Horizon Bank
ABA: 084000026 ACCT: 20000975923
OTHER DETAILS:

BANK:

ABA: ACCT:

OTHER DETAILS:

ACH NUMBERS
(IF APPLICABLE)
BANK: First Horizon Bank
ABA: 084000026 ACCT: 20000975923
OTHER DETAILS:

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved Page 2 of 14 September 5, 2006
ATTN:

ADDRESS:

CHECKS
(IF APPLICABLE)
ATTN:

ADDRESS:

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved Page 3 of 14 September 5, 2006
Base Contract for Sale and Purchase of Natural Gas
(Continued)
This Base Contract incorporates by reference for all purposes the General Terms and Conditions for Sale and Purchase of Natural Gas published by the North American Energy Standards Board. The parties hereby agree to the following provisions offered in said General Terms and Conditions. In the event the parties fail to check a box, the specified default provision shall apply. Select the appropriate box(es) from each section:

Section 1.2
Transaction
Procedure

◼ Oral (default)
OR
Written

Section 10.2
Additional
Events of
Default

◼ No Additional Events of Default (default)

Indebtedness Cross Default

Party A: __________________

Party B: __________________

Transactional Cross Default
Specified Transactions:

Section 2.7
Confirm Deadline

◼ 2 Business Days after receipt (default)
OR
Business Days after receipt

Section 2.8
Confirming Party

◼ Seller (default)
OR
Buyer

Section 3.2
Performance
Obligation

◼ Cover Standard (default)
OR
Spot Price Standard

Section 10.3.1
Early
Termination
Damages

◼ Early Termination Damages Apply (default)

OR

Early Termination Damages Do Not Apply

Note: The following Spot Price Publication applies to both of the immediately preceding.

Section 10.3.2
Other
Agreement
Setoffs

◼ Other Agreement Setoffs Apply (default)

◼ Bilateral (default)

Triangular

OR

Other Agreement Setoffs Do Not Apply

Section 2.31
Spot Price
Publication

◼ Gas Daily Midpoint (default)
OR

Section 6
Taxes

◼ Buyer Pays At and After Delivery Point (default)
OR
Seller Pays Before and At Delivery Point

Section 7.2
Payment Date

◼ 25th Day of Month following Month of delivery
(default)
OR
Day of Month following Month of delivery

Section 15.5
Choice Of Law

Delaware

Section 7.2
Method of Payment

◼ Wire transfer (default)
Automated Clearinghouse Credit (ACH)
Check

Section 15.10
Confidentiality

◼ Confidentiality applies (default)
OR
Confidentiality does not apply

Section 7.7
Netting

◼ Netting applies (default)
OR
Netting does not apply
◼ Special Provisions Number of sheets attached: 5
Addendum(s):

IN WITNESS WHEREOF, the parties hereto have executed this Base Contract in duplicate.

City of Roseville PARTY NAME ARM Energy Management LLC

By:

SIGNATURE

By:

Dominick Casey PRINTED NAME Scott Wischoff
City Manager TITLE President (US)

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved Page 4 of 14 September 5, 2006
General Terms and Conditions
Base Contract for Sale and Purchase of Natural Gas

SECTION 1. PURPOSE AND PROCEDURES

1.1. These General Terms and Conditions are intended to facilitate purchase and sale transactions of Gas on a Firm or Interruptible basis. "Buyer" refers to the party receiving Gas and "Seller" refers to the party delivering Gas. The entire agreement between the parties shall be the Contract as defined in Section 2.9.

The parties have selected either the “Oral Transaction Procedure” or the “Written Transaction Procedure” as indicated on the Base Contract.

Oral Transaction Procedure:

1.2. The parties will use the following Transaction Confirmation procedure. Any Gas purchase and sale transaction may be effectuated in an EDI transmission or telephone conversation with the offer and acceptance constituting the agreement of t he parties. The parties shall be legally bound from the time they so agree to transaction terms and may each rely thereon. Any such transaction shall be considered a “writing” and to have been “signed”. Notwithstanding the foregoing sentence, the parties agree that Confirming Party shall, and the other party may, confirm a telephonic transaction by sending the other party a Transaction Confirmation by facsimile, EDI or mutually agreeable electronic means within three Business Days of a transaction covered by this Section 1.2 (Oral Transaction Procedure) provided that the failure to send a Transaction Confirmation shall not invalidate the oral agreement of the parties. Confirming Party adopts its confirming letterhead, or the like, as its signature on any Trans action Confirmation as the identification and authentication of Confirming Party. If the Transaction Confirmation contains any provisions other than those relating to the commercial terms of the transaction (i.e., price, quantity, performance obligation, delivery point, period of delivery and/or transportation conditions), which modify or supplement the Base Contract or General Terms and Conditions of this Contract (e.g., arbitration or additional representations and warranties), such provisions shall not be deemed to be accepted pursuant to Section 1.3 but must be expressly agreed to by both parties; provided that the foregoing shall not invalidate any transaction agreed to by the parties.

Written Transaction Procedure:

1.2. The parties will use the following Transaction Confirmation procedure. Should the parties come to an agreement regarding a Gas purchase and sale transaction for a particular Delivery Period, the Confirming Party shall, and the other party may, re cord that agreement on a Transaction Confirmation and communicate such Transaction Confirmation by facsimile, EDI or mutually agreeable electronic means, to the other party by the close of the Business Day following the date of agreement. The parties acknowledge t hat their agreement will not be binding until the exchange of nonconflicting Transaction Confirmations or the passage of the Confirm Deadline without objection from the receiving party, as provided in Section 1.3.

1.3. If a sending party's Transaction Confirmation is materially different from the receiving party's understanding of the agreement referred to in Section 1.2, such receiving party shall notify the sending party via facsimile, EDI or mutually agreeable electronic means by the Confirm Deadline, unless such receiving party has previously sent a Transaction Confirmation to the sending party. The failure of the receiving party to so notify the sending party in writing by the Confirm Deadline constitutes the receiving party's agreement to the terms of the transaction described in the sending party's Transaction Confirmation. If there are any material differences between timely sent Transaction Confirmations governing the same transaction, then neither Transaction Confirmation shall be binding until or unless such differences are resolved including the use of any evidence that clearly resolves the differences in the Transaction Confirmations. In the event of a conflict among the terms of (i) a binding Transaction Confirmation pursuant to Section 1.2, (ii) the oral agreement of the parties which may be evidenced by a recorded conversation, where the parties have selected the Oral Transaction Procedure of the Base Contract, (iii) the Base Contract, and (iv) these General Terms and Conditions, the terms of the documents shall govern in the priority listed in this sentence.

1.4. The parties agree that each party may electronically record all telephone conversations with respect to this Contract between their respective employees, without any special or further notice to the other party. Each party shall obtain any necessary consent of its agents and employees to such recording. Where the parties have selected the Oral Transaction Procedure in Section 1.2 of the Base Contract, the parties agree not to contest the validity or enforceability of telephonic recordings entered into in accordance with the requirements of this Base Contract.

SECTION 2. DEFINITIONS
The terms set forth below shall have the meaning ascribed to them below. Other terms are also defined elsewhere in the Contr act and shall have the meanings ascribed to them herein.

2.1. “Additional Event of Default” shall mean Transactional Cross Default or Indebtedness Cross Default, each as and if selected by the parties pursuant to the Base Contract.

2.2. “Affiliate” shall mean, in relation to any person, any entity controlled, directly or indirectly, by the person, any entity that controls, directly or indirectly, the person or any entity directly or indirectly under common control with the person. For this purpose, “control” of any entity or person means ownership of at least 50 percent of the voting power of the entity or person.

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved Page 5 of 14 September 5, 2006

2.3. “Alternative Damages” shall mean such damages, expressed in dollars or dollars per MMBtu, as the parties shall agree upon in the Transaction Confirmation, in the event either Seller or Buyer fails to perform a Firm obligation to deliver Gas in the case of Seller or to receive Gas in the case of Buyer.

2.4. "Base Contract" shall mean a contract executed by the parties that incorporates these General Terms and Conditions by reference; that specifies the agreed selections of provisions contained herein; and that sets forth other information required herein and any Special Provisions and addendum(s) as identified on page one.

2.5. "British thermal unit" or "Btu" shall mean the International BTU, which is also called the Btu (IT).

2.6. "Business Day(s)" shall mean Monday through Friday, excluding Federal Banking Holidays for transactions in the U.S.

2.7. "Confirm Deadline" shall mean 5:00 p.m. in the receiving party's time zone on the second Business Day following the Day a Transaction Confirmation is received or, if applicable, on the Business Day agreed to by the parties in the Base Contract; provided, if the Transaction Confirmation is time stamped after 5:00 p.m. in the receiving party's time zone, it shall be deemed received at the opening of the next Business Day.

2.8. "Confirming Party" shall mean the party designated in the Base Contract to prepare and forward Transaction Confirmations to the other party.

2.9. "Contract" shall mean the legally -binding relationship established by (i) the Base Contract, (ii) any and all binding Transaction Confirmations and (iii) where the parties have selected the Oral Transaction Procedure in Section 1.2 of the Base Contract, any and all transactions that the parties have entered into through an EDI transmission or by telephone, but that have not been confirmed in a binding Transaction Confirmation, all of which shall form a single integrated agreement between the parties.

2.10. "Contract Price" shall mean the amount expressed in U.S. Dollars per MMBtu to be paid by Buyer to Seller for the purchase of Gas as agreed to by the parties in a transaction.

2.11. "Contract Quantity" shall mean the quantity of Gas to be delivered and taken as agreed to by the parties in a transaction.

2.12. "Cover Standard", as referred to in Section 3.2, shall mean that if there is an unexcused failure to take or deliver any quantity of Gas pursuant to this Contract, then the performing party shall use commercially reasonable efforts to (i) if Buye r is the performing party, obtain Gas, (or an alternate fuel if elected by Buyer and replacement Gas is not available), or (ii) if Sell er is the performing party, sell Gas, in either case, at a price reasonable for the delivery or production area, as applicable, con sistent with:
the amount of notice provided by the nonperforming party; the immediacy of the Buyer's Gas consumption needs or Seller's Gas sales requirements, as applicable; the quantities involved; and the anticipated length of failure by the nonperforming party.

2.13. "Credit Support Obligation(s)” shall mean any obligation(s) to provide or establish credit support for, or on behalf of, a party to this Contract such as cash, an irrevocable standby letter of credit, a margin agreement, a prepayment, a security interest in an asset, guaranty, or other good and sufficient security of a continuing nature.

2.14. "Day" shall mean a period of 24 consecutive hours, coextensive with a "day" as defined by the Receiving Transporter in a particular transaction.

2.15. "Delivery Period" shall be the period during which deliveries are to be made as agreed to by the parties in a transaction.

2.16. "Delivery Point(s)" shall mean such point(s) as are agreed to by the parties in a transaction.

2.17. "EDI" shall mean an electronic data interchange pursuant to an agreement entered into by the parties, specifically relating to the communication of Transaction Confirmations under this Contract.

2.18. "EFP" shall mean the purchase, sale or exchange of natural Gas as the "physical" side of an exchange for physical transaction involving gas futures contracts. EFP shall incorporate the meaning and remedies of "Firm", provided that a party’s excuse for nonperformance of its obligations to deliver or receive Gas will be governed by the rules of the relevant futures exchange regulated under the Commodity Exchange Act.

2.19. "Firm" shall mean that either party may interrupt its performance without liability only to the extent that such performance is prevented for reasons of Force Majeure; provided, however, that during Force Majeure interruptions, the party invoking For ce Majeure may be responsible for any Imbalance Charges as set forth in Section 4.3 related to its interruption after the nominatio n is made to the Transporter and until the change in deliveries and/or receipts is confirmed by the Transporter.

2.20. "Gas" shall mean any mixture of hydrocarbons and noncombustible gases in a gaseous state consisting primarily of methane.

2.21. “Guarantor” shall mean any entity that has provided a guaranty of the obligations of a party hereunder.

2.22. "Imbalance Charges" shall mean any fees, penalties, costs or charges (in cash or in kind) assessed by a Transporter for failure to satisfy the Transporter's balance and/or nomination requirements.

2.23. “Indebtedness Cross Default” shall mean if selected on the Base Contract by the parties with respect to a party, that it or its Guarantor, if any, experiences a default, or similar condition or event however therein defined, under one or more agreements or instruments, individually or collectively, relating to indebtedness (such indebtedness to include any obligation whether pres ent or future, contingent or otherwise, as principal or surety or otherwise) for the payment or repayment of borrowed money in an aggregate amount greater than the threshold specified in the Base Contract with respect to such party or its Guarantor, if any, which r esults in such indebtedness becoming immediately due and payable.

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved Page 6 of 14 September 5, 2006

2.24. "Interruptible" shall mean that either party may interrupt its performance at any time for any reason, whether or not caused by an event of Force Majeure, with no liability, except such interrupting party may be responsible for any Imbalance Charges as set forth in Section 4.3 related to its interruption after the nomination is made to the Transporter and until the change in deliveries and/or receipts is confirmed by Transporter.

2.25. "MMBtu" shall mean one million British thermal units, which is equivalent to one dekatherm.

2.26. "Month" shall mean the period beginning on the first Day of the calendar month and ending immediately prior to the commencement of the first Day of the next calendar month.

2.27. "Payment Date" shall mean a date, as indicated on the Base Contract, on or before which payment is due Seller for Gas received by Buyer in the previous Month.

2.28. "Receiving Transporter" shall mean the Transporter receiving Gas at a Delivery Point, or absent such receiving Transporter, the Transporter delivering Gas at a Delivery Point.

2.29. "Scheduled Gas" shall mean the quantity of Gas confirmed by Transporter(s) for movement, transportation or management.

2.30. “Specified Transaction(s)” shall mean any other transaction or agreement between the parties for the purchase, sale or exchange of physical Gas, and any other transaction or agreement identified as a Specified Transaction under the Base Contract.

2.31. "Spot Price " as referred to in Section 3.2 shall mean the price listed in the publication indicated on the Base Contract, under the listing applicable to the geographic location closest in proximity to the Delivery Point(s) for the relevant Day; p rovided, if there is no single price published for such location for such Day, but there is published a range of prices, then the Spot Pr ice shall be the average of such high and low prices. If no price or range of prices is published for such Day, then the Spot Price shall be the average of the following: (i) the price (determined as stated above) for the first Day for which a price or range of prices is published that next precedes the relevant Day; and (ii) the price (determined as stated above) for the first D ay for which a price or range of prices is published that next follows the relevant Day.

2.32. "Transaction Confirmation" shall mean a document, similar to the form of Exhibit A, setting forth the terms of a transaction formed pursuant to Section 1 for a particular Delivery Period.

2.33. “Transactional Cross Default” shall mean if selected on the Base Contract by the parties with respect to a party, that it shall be in default, however therein defined, under any Specified Transaction.

2.34. “Termination Option” shall mean the option of either party to terminate a transaction in the event that the other party fails to perform a Firm obligation to deliver Gas in the case of Seller or to receive Gas in the case of Buyer for a designated number of days during a period as specified on the applicable Transaction Confirmation.

2.35. "Transporter(s)" shall mean all Gas gathering or pipeline companies, or local distribution companies, acting in the capacity of a transporter, transporting Gas for Seller or Buyer upstream or downstream, respectively, of the Delivery Point pursuant to a particular transaction.

SECTION 3. PERFORMANCE OBLIGATION

3.1. Seller agrees to sell and deliver, and Buyer agrees to receive and purchase, the Contract Quantity for a particular transaction in accordance with the terms of the Contract. Sales and purchases will be on a Firm or Interruptible basis, as agreed to by the parties in a transaction.

The parties have selected either the “Cover Standard” or the “Spot Price Standard” as indicated on the Base Contract.

Cover Standard:

3.2. The sole and exclusive remedy of the parties in the event of a breach of a Firm obligation to deliver or receive Gas shall be recovery of the following: (i) in the event of a breach by Seller on any Day(s), payment by Seller to Buyer in an am ount equal to the positive difference, if any, between the purchase price paid by Buyer utilizing the Cover Standard and the Contract Price, adjusted for commercially reasonable differences in transportation costs to or from the Delivery Point(s), multiplied by the difference between the Contract Quantity and the quantity actually delivered by Seller for such Day(s) excluding any quantity for which no replacement is available ; or (ii) in the event of a breach by Buyer on any Day(s), payment by Buyer to Seller in the amount equal to the positive difference, if any, between the Contract Price and the price received by Seller utilizing the Co ver Standard for the resale of such Ga s, adjusted for commercially reasonable differences in transportation costs to or from the Delivery Point(s), multiplied by the difference between the Contract Quantity and the quantity actually taken by Buyer for such Day(s) excluding any quantity for which no sale is available ; and (iii) in the event that Buyer has used commercially reasonable efforts to replace the Gas or Seller has used commercially reasonable efforts to sell the Gas to a third party, and no such replacement or sale is available for all or any portion of the Contract Quantity of Gas , then in addition to (i) or (ii) above, as applicable, the sole and exclusive remedy of the performing party with respect to the Gas not replaced or sold shall be an amount equal to any unfavorable difference between the Contract Price and the Spot Price, adjusted for such transportation to the applicable Delivery Point, multiplied by the quantity of such Gas not replaced or sold. Imbalance Charges shall not be recovered under this Section 3.2, but Seller and/or Buyer shall be responsible for Imbalance Charges, if any, as provided in Section 4.3. The amount of such unfavorable difference shall be payable five Business Days after presentation of the performing party’s invoice, which shall set forth the basis upon which such amount was calculated.

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved Page 7 of 14 September 5, 2006
Spot Price Standard:

3.2. The sole and exclusive remedy of the parties in the event of a breach of a Firm obligation to deliver or receive Gas shall be recovery of the following: (i) in the event of a breach by Seller on any Day(s), payment by Seller to Buyer in an amount e qual to the difference between the Contract Quantity and the actual quantity delivered by Seller and received by Buyer for such Day(s), multiplied by the positive difference, if any, obtained by subtracting the Contract Price from the Spot Price; or (ii) in the event of a breach by Buyer on any Day(s), payment by Buyer to Seller in an amount equal to the difference between the Contract Quantity and the actual quantity delivered by Seller and received by Buyer for such Day(s), multiplied by the positive differe nce, if any, obtained by subtracting the applicable Spot Price from the Contract Price. Imbalance Charges shall not be recovered under th is Section 3.2, but Seller and/or Buyer shall be responsible for Imbalance Charges, if any, as provided in Section 4.3 . The amount of such unfavorable difference shall be payable five Business Days after presentation of the performing party’s invoice, whic h shall set forth the basis upon which such amount was calculated.

3.3. Notwithstanding Section 3.2, the parties may agree to Alternative Damages in a Transaction Confirmation executed in writing by both parties.

3.4. In addition to Sections 3.2 and 3.3, the parties may provide for a Termination Option in a Transaction Confirmation executed in writing by both parties. The Transaction Confirmation containing the Termination Option will designate the lengt h of nonperformance triggering the Termination Option and the procedures for exercise thereof, how damages for nonperformance will be compensated, and how liquidation costs will be calculated.

SECTION 4. TRANSPORTATION, NOMINATIONS, AND IMBALANCES

4.1. Seller shall have the sole responsibility for transporting the Gas to the Delivery Point(s). Buyer shall have the sole responsibility for transporting the Gas from the Delivery Point(s).

4.2. The parties shall coordinate their nomination activities, giving sufficient time to meet the deadlines of the affected Transporter(s).

Each party shall give the other party timely prior Notice, sufficient to meet the requirements of all Transporter(s) involved in the transaction, of the quantities of Gas to be delivered and purchased each Day. Should either party become aware that actual deliveries at the Delivery Point(s) are greater or lesser than the Scheduled Gas, such party shall promptly notify the other party.

4.3. The parties shall use commercially reasonable efforts to avoid imposition of any Imbalance Charges. If Buyer or Seller receives an invoice from a Transporter that includes Imbalance Charges, the parties shall determine the validity as well as the cause of such Imbalance Charges. If the Imbalance Charges were incurred as a result of Buyer’s receipt of quantities of Gas greater than or less than the Scheduled Gas, then Buyer shall pay for such Imbalance Charges or reimburse Seller for such Imbalance Charges paid by Seller. If the Imbalance Charges were incurred as a result of Seller’s delivery of quantities of Gas greater than or less than the Scheduled Gas, then Seller shall pay for such Imbalance Charges or reimburse Buyer for such Imbalance Charges paid by Buyer.

SECTION 5. QUALITY AND MEASUREMENT
All Gas delivered by Seller shall meet the pressure, quality and heat content requirements of the Receiving Transporter. The unit of quantity measurement for purposes of this Contract shall be one MMBtu dry. Measurement of Gas quantities hereunder shall be in accordance with the established procedures of the Receiving Transporter.

SECTION 6. TAXES
The parties have selected either “Buyer Pays At and After Delivery Point” or “Seller Pays Before and At Delivery Point” as indicated on the Base Contract.

Buyer Pays At and After Delivery Point:

Seller shall pay or cause to be paid all taxes, fees, levies, penalties, licenses or charges imposed by any government authority (“Taxes”) on or with respect to the Gas prior to the Delivery Point(s). Buyer shall pay or cause to be paid all Taxes on or with respect to the Gas at the Delivery Point(s) and all Taxes after the Delivery Point(s). If a party is required to remit or pay Taxes that are the other party’s responsibility hereunder, the party responsible for such Taxes shall promptly reimburse the other party for such Taxes. Any party entitled to an exemption from any such Taxes or charges shall furnish the other party any necessary documentation thereof.

Seller Pays Before and At Delivery Point:

Seller shall pay or cause to be paid all taxes, fees, levies, penalties, licenses or charges imposed by any government authority (“Taxes”) on or with respect to the Gas prior to the Delivery Point(s) and all Taxes at the Delivery Point(s). Buyer shall pay or cause to be paid all Taxes on or with respect to the Gas after the Delivery Point(s). If a party is required to remit or pay Taxes that are the other party’s responsibility hereunder, the party responsible for such Taxes shall promptly reimburse the other party for such Taxes. Any party entitled to an exemption from any such Taxes or charges shall furnish the other party any necessary documentation thereof.

SECTION 7. BILLING, PAYMENT, AND AUDIT

7.1. Seller shall invoice Buyer for Gas delivered and received in the preceding Month and for any other applicable charges, providing supporting documentation acceptable in industry practice to support the amount charged. If the actual quantity delivered is not known by the billing date, billing will be prepared based on the quantity of Scheduled Gas. The invoiced quantity will then be adjusted to the actual quantity on the following Month's billing or as soon thereafter as actual delivery information is available.

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved Page 8 of 14 September 5, 2006

7.2. Buyer shall remit the amount due under Section 7.1 in the manner specified in the Base Contract, in immediately available funds, on or before the later of the Payment Date or 10 Days after receipt of the invoice by Buyer; provided that if the Payment Date is not a Business Day, payment is due on the next Business Day following that date. In the event any payments are due Buyer hereunder, payment to Buyer shall be made in accordance with this Section 7.2.

7.3. In the event payments become due pursuant to Sections 3.2 or 3.3, the performing party may submit an invoice to the nonperforming party for an accelerated payment setting forth the basis upon which the invoiced amount was calculated. Paymen t from the nonperforming party will be due five Business Days after receipt of invoice.

7.4. If the invoiced party, in good faith, disputes the amount of any such invoice or any part thereof, such invoiced party will pay such amount as it concedes to be correct; provided, however, if the invoiced party disputes the amount due, it must provide supporting documentation acceptable in industry practice to support the amount paid or disputed without undue delay. In the event the parties are unable to resolve such dispute, either party may pursue any remedy available at law or in equity to enforce its rights pursuant to this Section.

7.5. If the invoiced party fails to remit the full amount payable when due, interest on the unpaid portion shall accrue from the date due until the date of payment at a rate equal to the lower of (i) the then-effective prime rate of interest published under "Money Rates" by The Wall Street Journal, plus two percent per annum; or (ii) the maximum applicable lawful interest rate.

7.6. A party shall have the right, at its own expense, upon reasonable Notice and at reasonable times, to examine and audit and to obtain copies of the relevant portion of the books, records, and telephone recordings of the other party only to the extent reasonably necessary to verify the accuracy of any statement, charge, payment, or computation made under the Contract. This right to examine, audit, and to obtain copies shall not be available with respect to proprietary information not directly relevant to transactions under this Contract. All invoices and billings shall be conclusively presumed final and accurate and all associated claims for under- or overpayments shall be deemed waived unless such invoices or billings are objected to in writing, with adequate explanation and/or documentation, within two years after the Month of Gas delivery. All retroactive adjustments under Section 7 shall be paid in full by the party owing payment within 30 Days of Notice and substantiation of such inaccuracy.

7.7. Unless the parties have elected on the Base Contract not to make this Section 7.7 applicable to this Contract, the parties shall net all undisputed amounts due and owing, and/or past due, arising under the Contract such that the party owing the greater amount shall make a single payment of the net amount to the other party in accordance with Section 7; provided tha t no payment required to be made pursuant to the terms of any Credit Support Obligation or pursuant to Section 7.3 shall be subject to netting un der this Section. If the parties have executed a separate netting agreement, the terms and conditions therein shall prevail to the ex tent inconsistent herewith.

SECTION 8. TITLE, WARRANTY, AND INDEMNITY

8.1. Unless otherwise specifically agreed, title to the Gas shall pass from Seller to Buyer at the Delivery Point(s). Seller shall have responsibility for and assume any liability with respect to the Gas prior to its delivery to Buyer at the specified Delivery Point(s).

Buyer shall have responsibility for and assume any liability with respect to said Gas after its delivery to Buyer at the Delivery Point(s).

8.2. Seller warrants that it will have the right to convey and will transfer good and merchantable title to all Gas sold hereunder and delivered by it to Buyer, free and clear of all liens, encumbrances, and claims. EXCEPT AS PROVIDED IN THIS SECTION 8.2 AND IN SECTION 15.8, ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY PARTICULAR PURPOSE, ARE DISCLAIMED.

8.3. Seller agrees to indemnify Buyer and save it harmless from all losses, liabilities or claims including reasonable attorneys' fees and costs of court ("Claims"), from any and all persons, arising from or out of claims of title, personal injury (including death) or property damage from said Gas or other charges thereon which attach before title passes to Buyer. Buyer agrees to indemnify Seller and save it harmless from all Claims, from any and all persons, arising from or out of claims regarding payment, personal injury (including death) or property damage from said Gas or other charges thereon which attach after title passes to Buyer.

8.4. The parties agree that the delivery of and the transfer of title to all Gas under this Contract shall take place within the Customs Territory of the United States (as defined in general note 2 of the Harmonized Tariff Schedule of the United States 19 U.S.C. §1202, General Notes, page 3); provided, however, that in the event Seller took title to the Gas outside the Customs Territory of the United States, Seller represents and warrants that it is the importer of record for all Gas entered and delivered into the United States, and shall be responsible for entry and entry summary filings as well as the payment of duties, taxes and fees, if any, and all applicable record keeping requirements.

8.5. Notwithstanding the other provisions of this Section 8, as between Seller and Buyer, Seller will be liable for all Claims to the extent that such arise from the failure of Gas delivered by Seller to meet the quality requirements of Section 5.

SECTION 9. NOTICES

9.1. All Transaction Confirmations, invoices, payment instructions, and other communications made pursuant to the Base Contract ("Notices") shall be made to the addresses specified in writing by the respective parties from time to time.

9.2. All Notices required hereunder shall be in writing and may be sent by facsimile or mutually acceptable electronic means, a nationally recognized overnight courier service, first class mail or hand delivered.

9.3. Notice shall be given when received on a Business Day by the addressee. In the absence of proof of the actual receipt date, the following presumptions will apply. Notices sent by facsimile shall be deemed to have been received upon the sendin g party's receipt of its facsimile machine's confirmation of successful transmission. If the day on which such facsimile is received is not a Business Day or is after five p.m. on a Business Day, then such facsimile shall be deemed to have been received on the next

Copyright © 2006 North American Energy Standards Board, Inc. NAESB Standard 6.3.1 All Rights Reserved Page 9 of 14 September 5, 2006
following Business Day. Notice by overnight mail or courier shall be deemed to have been received on the next Business Day after it was sent or such earlier time as is confirmed by the receiving party. Notice via first class mail shall be considered del ivered five Business Days after mailing.

9.4. The party receiving a commercially acceptable Notice of change in payment instructions or other payment information shall not be obligated to implement such change until ten Business Days after receipt of such Notice.

SECTION 10. FINANCIAL RESPONSIBILITY

10.1. If either party (“X”) has reasonable grounds for insecurity regarding the performance of any obligation under this Contract (whether or not then due) by the other party (“Y”) (including, without limitation, the occurrence of a material change in the creditworthiness of Y or its Guarantor, if applicable), X may demand Adequate Assurance of Performance. “Adequate Assurance of Performance” shall mean sufficient security in the form, amount, for a term, and from an issuer, all as reasonably acceptable to X, including, but not limited to cash, a standby irrevocable letter of credit, a prepayment, a security interest in an asset or gu aranty. Y hereby grants to X a continuing first priority security interest in, lien on, and right of setoff against all Adequate A ssurance of Performance in the form of cash transferred by Y to X pursuant to this Section 10.1. Upon the return by X to Y of such Adequ ate Assurance of Performance, the security interest and lien granted hereunder on that Adequate Assurance of Performanc e shall be released automatically and, to the extent possible, without any further action by either party.

10.2. In the event (each an "Event of Default") either party (the "Defaulting Party") or its Guarantor shall: (i) make an assignment or any general arrangement for the benefit of creditors; ( ii) file a petition or otherwise commence, authorize, or acquiesce in the commencement of a proceeding or case under any bankruptcy or similar law for the protection of creditors or have such petition filed or proceeding commenced against it; ( iii) otherwise become bankrupt or insolvent (however evidenced); ( iv) be unable to pay its debts as they fall due; ( v) have a receiver, provisional liquidator, conservator, custodian, trustee or other similar official appointed with respect to it or substantially all of its assets; (vi) fail to perform any obligation to the other party with respect to any Credit Support Obligations relating to the Contract; (vii) fail to give Adequate Assurance of Performance under Section 10.1 within 48 hours but at least one Business Day of a written request by the other party; (viii) not have paid any amount due the other party hereunder on or before the second Business Day following written Notice that such payment is due; or ix) be the affected party with respect to any Additional Event of Default; then the other party (the "Non-Defaulting Party") shall have the right, at its sole election, to immediately withhold and/or suspend deliveries or payments upon Notice and/or to terminate and liquidate the transactions under the Contr act, in the manner provided in Section 10.3, in addition to any and all other remedies available hereunder.

10.3. If an Event of Default has occurred and is continuing, the Non -Defaulting Party shall have the right, by Notice to the Defaulting Party, to designate a Day, no earlier than the Day such Notice is given and no later than 20 Days after such Notice is given, as an early termination date (the “Early Termination Date”) for the liquidation and termination pursuant to Section 10.3.1 of all transactions under the Contract, each a “Terminated Transaction ”. On the Early Termination Date, all transactions will termin ate, other than those transactions, if any, that may not be liquidated and terminated under applicable law (“Excluded Transactions ”), which Excluded Transactions must be liquidated and terminated as soon thereafter as is legally permissible, and upon termi nation shall be a Terminated Transaction and be valued consistent with Section 10.3.1 below. With respect to each Excluded Transaction, its actual termination date shall be the Early Termination Date for purposes of Section 10.3.1.

The parties have selected either “Early Termination Damages Apply” or “Early Termination Damages Do Not Apply” as indicated on the Base Contract.

Early Termination Damages Apply:

10.3.1. As of the Early Termination Date, the Non -Defaulting Party shall determine, in good faith and in a commercially reasonable manner, (i) the amount owed (whether or not then due) by each party with respect to all Gas delivered and received between the parties under Terminated Transactions and Excluded Transactions on and before the Early Termination Date and all other applicable charges relating to such deliveries and receipts (including without limitation any amounts owed under Sectio n

3.2), for which payment has not yet been made by the party that owes such payment under this Contract and (ii) the Market Value, as defined below, of each Terminated Transaction. The Non-Defaulting Party shall (x) liquidate and accelerate each Terminated Transaction at its Market Value, so that each amount equal to the difference between such Market Value and the Contract Value, as defined below, of such Terminated Transaction(s) shall be due to the Buyer under the Terminated Transaction(s) if such Market Value exceeds the Contract Value and to the Seller if the opposite is the case; and (y) where appropriate, discount each amount then due under clause (x) above to present value in a commercially reasonable manner as of the Early Termination Date (to take account of the period between the date of liquidation and the date on which such amount would have otherwise been due pursuant to the relevant Terminated Transactions).

For purposes of this Section 10.3.1, “Contract Value” means the amount of Gas remaining to be delivered or purchased under a transaction multiplied by the Contract Price, and “Market Value” means the amount of Gas remaining to be delivered or purchased under a transaction multiplied by the market price for a similar transaction at the Delivery Point determined by the Non-Defaulting Party in a commercially reasonable manner. To ascertain the Market Value, the Non-Defaulting Party may consider, among other valuations, any or all of the settlement prices of NYMEX Gas futures contracts, quotations from leading dealers in energy swap contracts or physical gas trading markets, similar sales or purchases and any other bona fide third -party offers, all adjusted for the length of the term and differences in transportation costs. A party shall not be required to enter into a replacement transaction(s) in order to determine the Market Value. Any extension(s) of the term of a transaction to which parties are not bound as of the Early Termination Date (including but not limited to “evergreen provisions”) shall not be considered in determining Contract Values and Market Values. For the avoidance of doubt, any option pursuant to which one party has the right to exten d

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the term of a transaction shall be considered in determining Contract Values and Market Values. The rate of interest used in calculating net present value shall be determined by the Non-Defaulting Party in a commercially reasonable manner.

Early Termination Damages Do Not Apply:

10.3.1. As of the Early Termination Date, the Non -Defaulting Party shall determine, in good faith and in a commercially reasonable manner, the amount owed (whether or not then due) by each party with respect to all Gas delivered and received between the parties under Terminated Transactions and Excluded Transactions on and before the Early Termination Date and all other applicable charges relating to such deliveries and receipts (including without limitation any amounts owed under Sectio n

3.2), for which payment has not yet been made by the party that owes such payment under this Contract.

The parties have selected either “Other Agreement Setoffs Apply” or “Other Agreement Setoffs Do Not Apply” as indicated on the Base Contract.

Other Agreement Setoffs Apply:

Bilateral Setoff Option:

10.3.2. The Non-Defaulting Party shall net or aggregate, as appropriate, any and all amounts owing between the parties under Section 10.3.1, so that all such amounts are netted or aggregated to a single liquidated amount payable by one party to the other (the “Net Settlement Amount”). At its sole option and without prior Notice to the De faulting Party, the Non-Defaulting Party is hereby authorized to setoff any Net Settlement Amount against (i) any margin or other collateral held by a party in connection with any Credit Support Obligation relating to the Contract; and (ii) any amount(s) (including any excess cash margin or excess cash collateral) owed or held by the party that is entitled to the Net Settlement Amount under any other agreement or arrangement between the parties.

Triangular Setoff Option:

10.3.2. The Non-Defaulting Party shall net or aggregate, as appropriate, any and all amounts owing between the parties under Section 10.3.1, so that all such amounts are netted or aggregated to a single liquidated amount payable by one party to the other (the “Net Settlement Amount”). At its sole option, and without prior Notice to the Defaulting Party, the Non-Defaulting Party is hereby authorized to setoff (i) any Net Settlement Amount against any margin or other collateral held by a party in connec tion with any Credit Support Obligation relating to the Contract; (ii) any Net Settlement Amount against any amount(s) (including any excess cash margin or excess cash collateral) owed by or to a party under any other agreement or arrangement between the parties; (iii) any Net Settlement Amount owed to the Non -Defaulting Party against any amount(s) (including any excess cash margin or excess cash collateral) owed by the Non -Defaulting Party or its Affiliates to the Defaulting Party under any other agreement or arrangement; (iv) any Net Settlement Amount owed to the Defaulting Party against any amount(s) (including any excess cash margin or excess cash collateral) owed by the Defaulting Party to the Non-Defaulting Party or its Affiliates under any other agreement or arra ngement; and/or (v) any Net Settlement Amount owed to the Defaulting Party against any amount(s) (including any excess cash margin or excess cash collateral) owed by the Defaulting Party or its Affiliates to the Non -Defaulting Party under any other agreement or arrangement.

Other Agreement Setoffs Do Not Apply:

10.3.2. The Non-Defaulting Party shall net or aggregate, as appropriate, any and all amounts owing between the parties under Section 10.3.1, so that all such amounts are netted or aggregated to a single liquidated amount payable by one party to the other (the “Net Settlement Amount”). At its sole option and without prior Notice to the De faulting Party, the Non-Defaulting Party may setoff any Net Settlement Amount against any margin or other collateral held by a party in connection with any Credit Support Obligation relating to the Contract.

10.3.3. If any obligation that is to be included in any netting, aggregation or setoff pursuant to Section 10.3.2 is unascertained, the Non-Defaulting Party may in good faith estimate that obligation and net, aggregate or setoff, as applicable, in respect of the estimate, subject to the Non-Defaulting Party accounting to the Defaulting Party when the obligation is ascertained. Any amount not then due which is included in any netting, aggregation or setoff pursuant to Section 10.3.2 shall be discounted to net prese nt value in a commercially reasonable manner determined by the Non-Defaulting Party.

10.4. As soon as practicable after a liquidation, Notice shall be given by the Non-Defaulting Party to the Defaulting Party of the Net Settlement Amount, and whether the Net Settlement Amount is due to or due from the Non -Defaulting Party. The Notice shall include a written statement explaining in reasonable detail the calculation of the Net Settlement Amount, provided that failure to give such Notice shall not affect the validity or enforceability of the liquidation or give rise to any claim by the Defaulting Party against the Non-Defaulting Party. The Net Settlement Amount as well as any setoffs applied against such amount pursuant to Section 10.3.2, shall be paid by the close of business on the second Business Day following such Notice, which date shall not b e earlier than the Early Termination Date. Interest on any unpaid portion of the Net Settlement Amount as adjusted by setoffs, shall accrue from the date due until the date of payment at a rate equal to the lower of (i) the then-effective prime rate of interest published under "Money Rates" by The Wall Street Journal, plus two percent per annum; or (ii) the maximum applicable lawful interest rate.

10.5. The parties agree that the transactions hereunder constitute a "forward contract" within the meaning of the United States Bankruptcy Code and that Buyer and Seller are each "forward contract merchants" within the meaning of the United States Bankruptcy Code.

10.6. The Non-Defaulting Party's remedies under this Section 10 are the sole and exclusive remedies of the Non -Defaulting Party with respect to the occurrence of any Early Termination Date. Each party reserves to itself all other rights, setoffs, counterclaims and other defenses that it is or may be entitled to arising from the Contract.

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10.7. With respect to this Section 10, if the parties have executed a separate netting agreement with close -out netting provisions, the terms and conditions therein shall prevail to the extent inconsistent herewith.

SECTION 11. FORCE MAJEURE

11.1. Except with regard to a party's obligation to make payment(s) due under Section 7, Section 10.4, and Imbalance Charges under Section 4, neither party shall be liable to the other for failure to perform a Firm obligation, to the extent such failure was caused by Force Majeure. The term "Force Majeure" as employed herein means any cause not reasonably within the control of the party claiming suspension, as further defined in Section 11.2.

11.2. Force Majeure shall include, but not be limited to, the following: (i) physical events such as acts of God, landslides, lightning, earthquakes, fires, storms or storm warnings, such as hurricanes, which result in evacuation of the affected area, floods, washouts, explosions, breakage or accident or necessity of repairs to machinery or equipment or lines of pipe; (ii) weather related events affecting an entire geographic region, such as low temperatures which cause freezing or failure of wells or lines of p ipe; (iii) interruption and/or curtailment of Firm transportation and/or storage by Transporters; (iv) acts of others such as strikes, lockouts or other industrial disturbances, riots, sabotage, insurrections or wars, or acts of terror; and (v) governmental actio ns such as necessity for compliance with any court order, law, statute, ordinance, regulation, or policy having the effect of law promul gated by a governmental authority having jurisdiction. Seller and Buyer shall make reasonable efforts to avoid the adverse impacts of a Force Majeure and to resolve the event or occurrence once it has occurred in order to resume performance.

11.3. Neither party shall be entitled to the benefit of the provisions of Force Majeure to the extent performance is affected by any or all of the following circumstances: (i) the curtailment of interruptible or secondary Firm transportation unless primary, in-path, Firm transportation is also curtailed; (ii) the party claiming excuse failed to remedy the condition and to resume the perfor mance of such covenants or obligations with reasonable dispatch; or (iii) economic hardship, to include, without limitation, Seller’s ability to sell Gas at a higher or more advantageous price than the Contract Price, Buyer’s ability to purchase Gas at a lower or more advantageous price than the Contract Price, or a regulatory agency disallowing, in whole or in part, the pass through of costs resulting from this Contract; (iv) the loss of Buyer’s market(s) or Buyer’s inability to use or resell Gas purchased hereunder, except, in either case, as provided in Section 11.2; or (v) the loss or failure of Seller’s gas supply or depletion of reserves, except, in either case, as provided in Section 11.2.

The party claiming Force Majeure shall not be excused from its responsibility for Imbalance Charges.

11.4. Notwithstanding anything to the contrary herein, the parties agree that the settlement of strikes, lockouts or other industrial disturbances shall be within the sole discretion of the party experiencing such disturbance.

11.5. The party whose performance is prevented by Force Majeure must provide Notice to the other party. Initial Notice may be given orally; however, written Notice with reasonably full particulars of the event or occurrence is required as soon as reasonably possible. Upon providing written Notice of Force Majeure to the other party, the affected party will be relieved of its obligation, from the onset of the Force Majeure event, to make or accept delivery of Gas, as applicable, to the extent and for the duration of Force Majeure, and neither party shall be deemed to have failed in such obligations to the other during such occurrence or event.

11.6. Notwithstanding Sections 11.2 and 11.3, the parties may agree to alternative Force Majeure provisions in a Transaction Confirmation executed in writing by both parties.

SECTION 12. TERM
This Contract may be terminated on 30 Day’s written Notice, but shall remain in effect until the expiration of the latest Delivery Period of any transaction(s). The rights of either party pursuant to Section 7.6, Section 10, Section 13, the obligations to make payment hereunder, and the obligation of either party to indemnify the other, pursuant hereto shall survive the termination of the Base Contract or any transaction.

SECTION 13. LIMITATIONS

FOR BREACH OF ANY PROVISION FOR WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES IS PROVIDED, SUCH EXPRESS REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY. A PARTY’S LIABILITY

HEREUNDER SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION, AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. IF NO REMEDY OR MEASURE OF DAMAGES IS EXPRESSLY PROVIDED HEREIN OR IN A TRANSACTION, A PARTY’S LIABILITY SHALL BE LIMITED TO DIRECT ACTUAL DAMAGES ONLY. SUCH DIRECT ACTUAL DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY, AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. UNLESS

EXPRESSLY HEREIN PROVIDED, NEITHER PARTY SHALL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE,

EXEMPLARY OR INDIRECT DAMAGES, LOST PROFITS OR OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR CONTRACT, UNDER ANY INDEMNITY PROVISION OR OTHERWISE. IT IS THE INTENT OF THE PARTIES THAT THE

LIMITATIONS HEREIN IMPOSED ON REMEDIES AND THE MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR

CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF ANY PARTY, WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER ARE

LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICU LT OR IMPOSSIBLE TO DETERMINE, OR

OTHERWISE OBTAINING AN ADEQUATE REMEDY IS INCONVENIENT AND THE DAMAGES CALCULATED HEREUNDER CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM OR LOSS.

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SECTION 14. MARKET DISRUPTION
If a Market Disruption Event has occurred then the parties shall negotiate in good faith to agree on a replacement price for the Floating Price (or on a method for determining a replacement price for the Floating Price) for the affected Day, and if the parties have not so agreed on or before the second Business Day following the affected Day then the replacement price for the Floating Pri ce shall be determined within the next two following Business Days with each party obtaining, in good faith and from non -affiliated market participants in the relevant market, two quotes for prices of Gas for the affected Day of a similar quality and quanti ty in the geographical location closest in proximity to the Delivery Point and averaging the four quotes. If either par ty fails to provide two quotes then the average of the other party’s two quotes shall determine the replacement price for the Floating Price. "Floating Price" means the price or a factor of the price agreed to in the transaction as being based upon a specified index. "Market Disruption Event" means, with respect to an index specified for a transaction, any of the following events: (a) the failure of the index to ann ounce or publish information necessary for determining the Floating Price; (b) the failure of trading to commence or the permanent discontinuation or material suspension of trading on the exchange or market acting as the index; (c) the temporary or permane nt discontinuance or unavailability of the index; (d) the temporary or permanent closing of any exchange acting as the index; or (e) both parties agree that a material change in the formula for or the method of determining the Floating Price has occurred. For the purposes of the calculation of a replacement price for the Floating Price, all numb ers shall be rounded to three decimal places. If the fourth decimal number is five or greater, then the third decimal number shall be increased by one and if the fourth decimal number is less than five, then the third decimal number shall remain unchanged.

SECTION 15. MISCELLANEOUS

15.1. This Contract shall be binding upon and inure to the benefit of the successors, assigns, personal representatives, and heirs of the respective parties hereto, and the covenants, conditions, rights and obligations of this Contract shall run for the full term of this Contract.

No assignment of this Contract, in whole or in part, will be made without the prior written consent of the non-assigning party (and shall not relieve the assigning party from liability hereunder), which consent will not be unreasonably withheld or delayed; provided, either party may (i) transfer, sell, pledge, encumber, or assign this Contract or the accounts, revenues, or proceeds hereof in connection with any financing or other financial arrangements, or (ii) transfer its interest to any parent or Affiliate by assignment, merger or otherwise without the prior approval of the other party. Upon any such assignment, transfer and assumption, the transferor shall remain principally liable for and shall not be relieved of or discharged from any obligations hereunder.

15.2. If any provision in this Contract is determined to be invalid, void or unenforceable by any court having jurisdiction, such determination shall not invalidate, void, or make unenforceable any other provision, agreement or covenant of this Contract.

15.3. No waiver of any breach of this Contract shall be held to be a waiver of any other or subsequent breach.

15.4. This Contract sets forth all understandings between the parties respecting each transaction subject hereto, and any prior contracts, understandings and representations, whether oral or written, relating to such transactions are merged into and superseded by this Contract and any effective transaction(s). This Contract may be amended only by a writing executed by both parties.

15.5. The interpretation and performance of this Contract shall be governed by the laws of the jurisdiction as indicated on the Base Contract, excluding, however, any conflict of laws rule which would apply the law of another jurisdiction.

15.6. This Contract and all provisions herein will be subject to all applicable and valid statutes, rules, orders and regulations of any governmental authority having jurisdiction over the parties, their facilities, or Gas supply, this Contract or transaction or any provisions thereof.

15.7. There is no third party beneficiary to this Contract.

15.8. Each party to this Contract represents and warrants that it has full and complete authority to enter into and perform this Contract.

Each person who executes this Contract on behalf of either party represents and warrants that it has full and complete authority to do so and that such party will be bound thereby.

15.9. The headings and subheadings contained in this Contract are used solely for convenience and do not constitute a part of this Contract between the parties and shall not be used to construe or interpret the provisions of this Contract.

15.10. Unless the parties have elected on the Base Contract not to make this Section 15.10 applicable to this Contract, neither party shall disclose directly or indirectly without the prior written consent of the other party the terms of any transaction to a third party (other than the employees, lenders, royalty owners, counsel, accountants and other agents of the party, or prospective purchasers of all or substantially all of a party’s assets or of any rights under this Contract, provided such persons shall have agreed to keep such terms confidential) except (i) in order to comply with any applicable law, order, regulation, or exchange rule, (ii) to the extent necessary for the enforcement of this Contract , (iii) to the extent necessary to implement any transaction, (iv) to the extent necessary to comply with a regulatory agency’s reporting requirements including but not limited to gas cost recovery proceedings; or (v) to the extent such information is delivered to such third party for the sole purpose of calculating a published index. Each party shall notify the other party of any proceeding of which it is aware which may result in disclosure of the terms of any transaction (other than as permitted hereunder) and use reasonable efforts to prevent or limit the disclosure. The existence of this Contract is not subject to this confidentiality obligation. Subject to Section 13, the parties shall be entitled to all remedies available at law or in equity to enforce, or seek relief in connection with this confidentiality obligation. The terms of any transaction hereunder shall be kept confidential by the parties hereto for one year from the expiration of the transaction.

In the event that disclosure is required by a governmental body or applicable law, the party subject to such requirement may disclose the material terms of this Contract to the extent so required, but shall promptly notify the other party, prior to disclos ure, and shall cooperate (consistent with the disclosing party’s legal obligations) with the other party’s efforts to obtain protective orde rs or similar restraints with respect to such disclosure at the expense of the other party.

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15.11. The parties may agree to dispute resolution procedures in Special Provisions attached to the Base Contract or in a Transaction Confirmation executed in writing by both parties

15.12. Any original executed Base Contract, Transaction Confirmation or other related document may be digitally copied, photocopied, or stored on computer tapes and disks (the “Imaged Agreement”). The Imaged Agreement, if introduced as evidence on paper, the Transaction Confirmation, if introduced as evidence in automated facsimile form, the recording, if introduced a s evidence in its original form, and all computer records of the foregoing, if introduced as evidence in printed format, in any judicial, arbitration, mediation or administrative proceedings will be admissible as between the parties to the same extent and under the same conditions as other business records originated and maintained in documentary form. Neither Party shall object to the admissi bility of the recording, the Transaction Confirmation, or the Imaged Agreement on the basis that such were not originated or maintained in documentary form. However, nothing herein shall be construed as a waiver of any other objection to the admissibility of such evidence.

DISCLAIMER: The purposes of this Contract are to facilitate trade, avoid misunderstandings and make more definite the terms of contracts of purchase and sale of natural gas. Further, NAESB does not mandate the use of this Contract by any party. NAESB DISCLAIMS AND EXCLUDES, AND ANY USER OF

THIS CONTRACT ACKNOWLEDGES AND AGREES TO NAESB'S DISCLAIMER OF, ANY AND ALL WARRANTIES, CONDITIONS OR

REPRESENTATIONS, EXPRESS OR IMPLIED, ORAL OR WRITTEN, WITH RESPECT TO THIS CONTRACT OR ANY PART THEREOF, INCLUDING

ANY AND ALL IMPLIED WARRANTIES OR CONDITIONS OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY, OR FITNESS OR SUITABILITY FOR

ANY PARTICULAR PURPOSE (WHETHER OR NOT NAESB KNOWS, HAS REASON TO KNOW, HAS BEEN ADVISED, OR IS OTHERWISE IN FACT

AWARE OF ANY SUCH PURPOSE), WHETHER ALLEGED TO ARISE BY LAW, BY REASON OF CUSTOM OR USAGE IN THE TRADE, OR BY COURSE OF DEALING. EACH USER OF THIS CONTRACT ALSO AGREES THAT UNDER NO CIRCUMSTANCES WILL NAESB BE LIABLE FOR ANY DIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES ARISING OUT OF ANY USE OF THIS CONTRACT.

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TRANSACTION CONFIRMATION EXHIBIT A

FOR IMMEDIATE DELIVERY

Letterhead/Logo

Date: ____________________________, _____
Transaction Confirmation #: _______________

This Transaction Confirmation is subject to the Base Contract between Seller and Buyer dated ______________________. The terms of this Transaction Confirmation are binding unless disputed in writing within 2 Business Days of receipt unless otherwise specified in the Base Contract.

SELLER:
_______________________________________________
_______________________________________________
_______________________________________________
Attn: ___________________________________________
Phone: _________________________________________
Fax: ___________________________________________
Base Contract No. ________________________________
Transporter: _____________________________________
Transporter Contract Number: _______________________

BUYER:
_______________________________________________
_______________________________________________
_______________________________________________
Attn: ___________________________________________
Phone: _________________________________________
Fax: ___________________________________________
Base Contract No. ________________________________
Transporter: _____________________________________
Transporter Contract Number: _______________________

Contract Price: $ /MMBtu or ______________________________________________________________________

Delivery Period: Begin: , ___ End: , ___

Performance Obligation and Contract Quantity: (Select One)

Firm (Fixed Quantity): Firm (Variable Quantity): Interruptible:

MMBtus/day MMBtus/day Minimum Up to MMBtus/day

EFP MMBtus/day Maximum
subject to Section 4.2. at election of
Buyer or
Seller

Delivery Point(s): ________________________
(If a pooling point is used, list a specific geographic and pipeline location):

Special Conditions:

Seller: __________________________________________

By: ____________________________________________

Title: ___________________________________________

Date: __________________________________________

Buyer: __________________________________________

By: ____________________________________________

Title: ___________________________________________

Date: __________________________________________

1 SPECIAL PROVISIONS to the
Base Contract for Sale and Purchase of Natural Gas
(NAESB Standard 6.3.1 dated September 5, 2006)

Between
City of Roseville (“Party A”)
and
ARM Energy Management LLC (“Party B”)

Dated September 24, 2025

1. The Cover Sheet shall be amended as follows: In the first sentence of the paragraph following the bank information on the cover sheet, insert the phrase “(NAESB Standard 6.3.1)” immediately after the word “Gas”, and insert the date “September 5, 2006” immediately after the word “published”.

2. Section 2.10 shall be amended to add the following sentence to the end of the section: “The Contract Price includes reimbursement to Seller for any production or severance taxes owed by Seller with respect to Gas delivered hereunder.”

3. Section 2.12 is amended by deleting “(or an alternative fuel if elected by Buyer and replacement Gas is not available),” after the phrase “obtain Gas” in the third line.

4. In Section 2, Definitions, add the following definitions at the end:

2.36. “Act” means Constitution of the State of California, the California statute(s), charter and municipal ordinances under which City of Roseville was created, organized and authorized to enter into this Base Contract and each Transaction thereunder.”;

2.37. “Costs” means, with respect to the Non-Defaulting Party, brokerage fees, commissions and other similar third party transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged its obligations or entering into new arrangements which replace a Terminated Transaction; and all reasonable attorneys’ fees and expenses incurred by the Non -Defaulting Party in connection with the termination of a Transaction.

2.38. “Governmental Entity or Public Power System” means a municipality, county, governmental board, public power authority, public utility district, joint action agency, or other similar political subdivision or public entity of the United States, one or more States or territories or any combination thereof.

5. Amend Section 8.3 by adding the following sentence to the end of this paragraph:

“Neither party shall be obligated to indemnify, defend, or hold the other party harmless to the extent any liability, suit, action, damage, loss or expense arises out of or in connection with any negligent act, negligent failure to act or willful misconduct on the part of the other party, its officers, agents or employees.”

6. Insert a new Section 8.6 stating that:

8.6 Each party represents and warrants to the other party, as of the date of the Base Contract and these Special Provisions, and each date of a Transaction Confirmation hereunder, that:

8.6.1 It is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant under such laws, in good standing;

8.6.2 The execution of, and delivery and performance under, this Contract does not violate or conflict with any law, rule, or regulation applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets, or any contractual restriction binding on or affecting it or any of its assets;

2 8.6.3 There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suit or proceeding at law or in equity or before any court, governmental body or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Contract or any Transaction to which it is a party or its ability to perform its obligations under the same;

8.6.4 It is not relying upon any representations of the other party, other than those set forth in this Contract, any Transaction Confirmation or any Credit Support Obligation(s) of the other party; and

8.6.5 It has entered into this Contract and each Transaction and Transaction Confirmation thereof as principal (and not as advisor, agent, broker or in any other capacity, fiduciary or otherwise) and has made its trading and investment decisions (including regar ding the suitability thereof), with a full understanding of the material terms and risks, and ability to assume the risks of the same, and based upon its own judgment and any advice from such advisors as it has deemed necessary and not in reliance upon any view expressed by the other party.”

7. Amend Section 10.2 by adding the following as clauses (x) through (xii):
(x) breach any material covenant or obligation under the Contract (except to the extent constituting a separate Event of Default or an obligation the remedy for breach of which is set forth in Section 3), if such breach is not cured within 10 Business Days of notice of a demand for cure;

(xi) consolidate or amalgamate with, or merge with or into, or transfer all or substantially all its assets to, or reorganize, incorporate, reincorporate, or reconstitute into or as, another entity, or another entity transfers all or substantially all its assets to, or reorganizes, incorporates, reincorporates, or reconstitutes into or as, the Defaulting Party or its Guarantor and: (a) the creditworthiness of the Defaulting Party, its Guarantor or the resulting, surviving, transferee or successor entity is materially weaker than that of the Defaulting Party or such Guarantor, as the case may be, immediately prior to such action; (b) the resulting, surviving, transferee or successor entity fails to assume all the obligations of the Defaulting Party or such G uarantor under this Contract or any Credit Support Obligations to which it or its predecessor was a party, by either operation of law or pursuant to an agreement reasonably satisfactory to the Non-Defaulting Party; or (c) the benefits of any Credit Support Obligation fail to extend (without the consent of the Non-Defaulting Party) to the performance by such resulting, surviving, transferee or successor entity of its obligations under this Contract; or

(xii) make a materially incorrect or materially misleading representation or warranty under the Contract or a Credit Support Obligation, if any, or a Credit Support Obligation expires or terminates with respect to the obligations of a party under this Contract or a Transaction Confirmation, or the failing or ceasing of such Credit Support Obligation to be in full force or effect for the purpose of this Contract or a Transaction Confirmation (in either case other than in accordance with the terms of this Con tract and any applicable Transaction Confirmation) before the satisfaction of all obligations of such party under this Contract and under each transaction to which such Credit Support Obligation relates, without the written consent of the other party.”

8. Section 10.3.2. “Bilateral Setoff Option”: insert after “Section 10.3.1” on the second line, the words “plus all Costs.”

9. Section 10.3 shall be amended by adding after the words “under applicable law” in the second sentence, the following “or that are, in the reasonable opinion of the Non-Defaulting Party, commercially impracticable to liquidate and terminate” and deleting the words “legally permissible” and replacing them with “reasonably practicable”.

10. Section 10.5 is amended by deleting the section in its entirety and replacing it with the following:

10.5 Bankruptcy

10.5.1 The parties intend that (i) all transactions constitute a “forward contract” within the meaning of the United States Bankruptcy Code (the “Bankruptcy Code”); (ii) all payments made or to be made by one party to the other party pursuant to this Contract c onstitute “settlement payments” within the meaning of the Bankruptcy Code; (iii) all transfers of Adequate Assurance of Performance by one party to the other

3 party under this Contract constitute “margin payments” within the meaning of the Bankruptcy Code; and (iv) this Contract constitutes a “master netting agreement” within the meaning of the Bankruptcy Code.

10.5.2 Each party further agrees that, for purposes of this Contract, the other party is not a “utility” as such term is used in 11 U.S.C. Section 366, and each party waives and agrees not to assert the applicability of the provisions of 11 U.S.C. Section 366 in any bankruptcy proceeding wherein such party is a debtor. In any such proceeding, each party further waives the right to assert that the other party is a provider of last resort.”

11. A new Section 10.8 shall be added as follows:

“10.8. Notwithstanding any provision to the contrary contained in the Contract, the Non -Defaulting Party shall not be required to pay to the Defaulting Party any amount under this Section 10 until the Non-Defaulting Party receives confirmation satisfactory to it in its reasonable discretion (which may include an opinion of its counsel) that all other obligations of any kind whatsoever of the Defaulting Party to make any payments to the Non-Defaulting Party under the Contract or otherwise have been fully and finally performed.”

12. Section 11.6 shall be deleted in its entirety.

13. Section 12 shall be amended to add the word “prior” immediately before the phrase “written Notice” in the first sentence.

14. Section 13 is amended by (i) deleting in the seventh line the words, “UNLESS EXPRESSLY HEREIN PROVIDED”, (ii) adding in the ninth line the words “PROVIDED, HOWEVER, NOTHING

IN THIS SECTION SHALL AFFECT THE ENFORCEABILITY OF THE PROVISIONS OF THIS

CONTRACT RELATING TO REMEDIES FOR FAILURE TO DELIVER/RECEIVE IN SECTION 3, AND CALCULATION AND PAYMENT OF THE TERMINATION DAMAGES IN SECTION 10 .” immediately after the words “ANY INDEMNITY PROVISION OR OTHERWISE”, and (iii) adding at the end of the last sentence th e words “AND ARE NOT PENALTIES”.

15. In Section 15.10, insert the words “party’s and the party’s affiliates’” at the beginning of the third line.

16. Section 15.11 shall be deleted in its entirety and replaced with the following:

“Section 15.11. To the fullest extent permitted by applicable law, each Party waives its respective right to any jury trial with respect to any litigation arising under or in connection with this Base Contract or any transaction.”

17. The following will be added as new sections:

“Section 15.13 Governmental Entity or Public Power System Security. With respect to each transaction, Governmental Entity or Public Power System shall , upon execution of this Base Contract and prior to the commencement of each subsequent fiscal year of Governmental Entity or Public Power System during any delivery period, have obtained all necessary budgetary approvals and certifications for payment of all of its obligations under this agreement for such fiscal year; any breach of this provision shall be deemed to have arisen during a fiscal period of Governmental Entity or Public Power System for which budgetary approval or certification of its obligations under this Base Contract is in effect and, notwithstanding anything to the contrary in Section 10.3.1, an Early Termination Date shall automatically and without further notice occur hereunder as of such date wherein Governmental Entity or Public Power System shall be treated as the Defaulting Party. Governmental Entity or Public Power System shall have a llocated to its general funds a revenue base that is adequate to cover Public Power System’s payment obligations hereunder throughout the entire delivery period.

Section 15.14. Notwithstanding any other provision of this agreement, upon receipt of a public records or information request pursuant to the California Public Records Act, or any similar act,

4 City of Roseville may, at its sole discretion, disclose confidential information, which does not fall within a statutory exemption (e.g., trade secret information) from disclosure.”

15.15 Each party irrevocably waives its rights, including under Sections 4 and 5 of the Natural Gas Act, to file a complaint, request an investigation or make a unilateral rate -change request seeking (a) an order from FERC finding that the rates agreed to by the Parties in this Agreement are unjust and unreasonable; or (b) any refund with respect to such rate(s). Each party agrees not to make such a filing or request, and that these covenants and waivers shall be binding notwithstanding any regulatory or market changes that may occur hereafter. Absent the agreement of both Parties to a proposed change, the standard of review for changes to any section of the Agreements proposed by a party (to the extent that any waiver as set forth in this Section 15.14 is unenforceable or ineffective as to such party), a non -party or FERC acting sua sponte, shall solely be the “public interest” application of the “just and reasonable” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co. , 350 U.S. 348 (1956) and clarified by Morgan Stanley Capital Group, Inc. v.

Public Util. Dist. No. 1 of Snohomish 554 U.S. 527 (2008) ( the “Mobile-Sierra” doctrine).”

15.16 This Contract shall be considered for all purposes as prepared through the joint efforts of the parties and shall not be construed against one party or the other as a result of the manner in which this Contract was negotiated, prepared, drafted or executed.

15.17 No failure on the part of any party to exercise, and no delay in exercising, any right under this Contract shall operate as waiver thereof, nor shall any partial exercise of any such right preclude the exercise of any other right. No waiver shall be valid unless set forth in a signed writing.

18. A new Section 16 shall be added as follows:

“Section 16. RESOLUTION OF DISPUTES

16.1. Resolution of Disputes. Any dispute or need of interpretation between the Parties involving or arising under this Base Contract first may be referred for resolution to a senior representative of each Party. Upon receipt of a notice describing the dispute and designating the notifying Party’s senior representative and that the dispute is to be resolved by the Parties’ senior representatives under this Base Contract, the other Party shall promptly designate its senior representative to the notifying Party. The senior representatives so designated shall attempt to resolve the dispute on an informal basis as promptly as practicable. If the dispute has not been resolved within thirty (30) days after the notifying Party’s notice was received by the other Party, or within such other period as the Parties may jointly agree, the Parties may mutually agree to submit the dispute to arbitration or pursue all remedies available under the law.

5 IN WITNESS WHEREOF, the parties have caused these Special Provisions to be duly executed and become effective as of the date first written above.

Party A: City of Roseville Party B: ARM Energy Management LLC

By: ............................................................................. By:
.....................................................................................

Name: Name: Scott Wischoff
Title: Title: President (US)
Date: Date: September 24, 2025

___________________________________________________________________________________________________________ Copyright © 2003 North American Energy Standards Board, Inc. Model Credit Support Addendum All Rights Reserved Page 1 Adopted October 9, 2003
Model Credit Support Addendum
to the
Base Contract for Sale and Purchase of Natural Gas

This Model Credit Support Addendum (“CSA”) is entered into as of this 24th day of September, 2025.

The parties to this CSA are the following:

Party A Party B
City of Roseville and ARM Energy Management LLC

Base Contract Date: September 24, 2025 Base Contract Date: September 24, 2025 Base Contract Number: Base Contract Number:

Credit Related Notices:

Attn: Utility Director Attn: Credit Department
Phone: (916) 774-5602 Fax: (916) 774-5583 Phone: 281-655-3200 Fax: 281-664-0029 E-mail Address: ________________________________ E-mail Address: [email protected] Wire Transfer or ACH Numbers (if applicable):

Bank: U.S. Bank Bank: First Horizon Bank
ABA: 121122676 ABA: 084000026
ACCT: 153499281092 ACCT: 20000975923
Other Details: For the account of the City of Roseville Other Details:

This CSA is published by the North American Energy Standards Board, Inc. The parties hereby agree to the following provisions offered in said CSA Elections.

Credit Support
Provider
Party A : N/A
Party B : ARM Energy Services, LLC
Interest Rate The "Interest Rate" will be a per annum rate of interest equal to the Federal Funds Rate. "Federal Funds
Rate" means, for any day, an interest rate per annum
equal to either (A) the rate published as the Federal
Funds Effective Rate that appears on the Telerate

Business Day, for the preceding Business Day) or (B)
if such rate is not so published for any day which is a Business Day, the Federal Funds Rate as published
by the Federal Reserve Bank in the H.15 Release.

Eligible
Collateral

Valuation
Percentage
Party A: ◼ Cash 100%
◼ Letters of Credit 100%*
Other _____________ ___%
Party B: ◼ Cash 100%
◼ Letters of Credit 100%*
Other _____________ ___%
* - See Definition of Valuation Percentage.

Minimum
Transfer
Amount
Party A: $100,000.00

Party B: $100,000.00
Letter of
Credit Issuer
Requirements
A commercial bank or trust company or financial
institution, which is not affiliated with either party, organized under the laws of the United States or a
political subdivision thereof, with (i) a Credit Rating of at least (a) "A-" by S&P and "A3" by Moody's, if such
entity is rated by both S&P and Moody’s or (b) "A-" by
S&P or "A3" by Moody's, if such entity is rated by
either S&P or Moody’s but not both, and (ii) having
assets of at least $10,000,000,000.

Transfer
Method for
Other Eligible
Collateral

Party A: N/A

Party B: N/A
Notification
Time

Close of
Business
1 p.m. Eastern Prevailing Time
◼ Other: 2:00 p.m. New York Time on a Business
Day.

5 p.m. Eastern Prevailing Time
◼ Other: 5:00 p.m. Pacific Prevailing Time

Collateral
Threshold
See attached Rating Matrix
◼ Flat amounts
Party A:Five Million ($5,000,000)
Party B: The greater of $0 or the amount set forth
in the Letter of Credit provided by Party B to
Rounding
Amount
Party A: $100,000
Party B: $100,000

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Party A. Provided, however, the Collateral
Threshold for Party B shall not exceed
$2,000,000.

Eligibility
Requirements
to Hold Cash
Party A: Not a Defaulting Party. Posted
Collateral must be held only in the United States
of America.

Party B: Not a Defaulting Party. Posted
Collateral must be held only in the United States
of America.

Custodian
Requirements

A commercial bank or trust company or financial
institution, which is not affiliated with either party, organized under the laws of the United States or a
political subdivision thereof, with (i) a Credit Rating of at least (a) "A-" by S&P and "A3" by Moody's, if such
entity is rated by both S&P and Moody’s or (b) "A-" by
S&P or "A3" by Moody's, if such entity is rated by
either S&P or Moody’s but not both, and (ii) having
assets of at least $10,000,000,000.

◼ OPTION A for CSA Paragraphs 4, 5 and 6 – OR – OPTION B for CSA Paragraphs 4, 5 and 6 (Exhibit A for elections is attached.) Special Provisions Number of sheets attached: ____________________________________________ IN WITNESS WHEREOF, the parties hereto have executed the first page of this CSA in duplicate.

Party A: City of Roseville Party B: ARM Energy Management LLC By By
Name: Name:

Title: City Manager Title:

GENERAL TERMS AND CONDITIONS
of the

MODEL CREDIT SUPPORT ADDENDUM
to the

BASE CONTRACT FOR PURCHASE AND SALE OF NATURAL GAS

Paragraph 1. Purpose

This CSA constitutes an Addendum to that certain Base Contract for Sale and Purchase of Natural Gas, as identified on the front page herein, between the parties (“Base Contract”), and supplements, forms part of, and amends the Base Contract affecting transactions thereunder. Capitalized terms used in this CSA that are not herein defined will have the meanings ascribed to them in the Base Contract. In the event of a conflict between the terms of this CSA and the Base Contract, the terms of this CSA shall apply for the purposes of this CSA.

The terms set forth below shall have the meanings ascribed to them below. Other terms are also defined elsewhere in the Base Contract and shall have the meanings ascribed to them therein.

Paragraph 2. Definitions.

As used in this CSA:

“Cash” shall mean United States Dollars.

“Close of Business” shall have the meaning set forth in the elections on Page 1 herein.

"Collateral Requirement" shall have the meaning set forth in Paragraph 3 herein.

"Collateral Threshold" shall mean, with respect to a party, the amount, if any, set forth in the elections on Page 1 herein for such party; provided, however, that the Collateral Threshold for a party that is a Defaulting Party shall be zero (0) upon the occurrence and during the continuance of an Event of Default.

"Credit Support Default" shall have the meaning set forth in Paragraph 10 herein.

“Credit Support Provider”, if applicable, shall mean the entity set forth in the elections on Page 1 herein.

Scott Wischoff
President (US)

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“Custodian” shall mean an entity that meets the Custodian Requirements set forth in the elections on Page 1 herein.

"Defaulting Party" shall have the meaning set forth in Paragraph 10 herein.

"Demand Date" shall mean, with respect to a party's (i) demand for the Transfer of Eligible Collateral pursuant to Paragraph 4 herein, (ii) demand for Reduction or Substitution of Posted Collateral pursuant to Paragraph 5 herein, and/or (iii) demand for Disputed Calculations pursuant to Paragraph 6 herein:
(a) the date on which a demand is made, if such demand is received prior to the Notification Time on a Business Day; or
(b) the following Business Day if a demand is made on a non -Business Day or after the Notification Time on a Business Day.

"Eligible Collateral" shall have the meaning set forth in the elections on Page 1 herein.

"Exposure" shall mean the Net Settlement Amount, as calculated by the Secured Party in good faith and in a commercially reasonable manner, that the Pledging Party would owe to the Secured Party if an Early Termination Date had been designated as of the date of such calculation as provided for in Section 10 of the Base Contract; provided that such calculations shall be at the mid point between the bid price and the offer price.

"Interest Amount" shall mean the aggregate sum of the amounts of interest calculated for each day in that Interest Period on the principal amount of Cash held by the Secured Party on that day, determined for each such day as follows: (x) the amount of Cash on that day; multiplied by (y) the Interest Rate for that day: divided by (z) 360.

"Interest Period" shall mean the period from (and including) the last Business Day on which an Interest Amount was Transferred (or if no Interest Amount has yet been Transferred, the Business Day on which Cash was Transferred to the Secured Party) to (but excluding) the Business Day on which the current Interest Amount is to be Transferred.

"Interest Rate" shall have the meaning set forth in the elections on Page 1 herein.

"Letter of Credit" shall have the meaning set forth in Paragraph 7 (a) herein. “Letter of Credit Default” shall have the meaning set forth in Paragraph 7(b) herein.

“Minimum Transfer Amount” shall mean the amount set forth in the elections on Page 1 herein for a party.

“Notification Time” shall have the meaning set forth in the elections on Page 1 herein.

“Notice” shall have the meaning set forth in Paragraph 9 herein.

“Pledging Party” shall have the meaning set forth in Paragraph 3 herein.

"Posted Collateral" shall mean (1) all Eligible Collateral and all proceeds thereof that have been Transferred to or received by the Secured Party hereunder and not Transferred to the Pledging Party pursuant to Paragraph 4 or released by the Secured Party, (2) any Interest Amount or portion thereof held by the Secured Party and not Transferred pursuant to Paragraph 8(c), and (3) any Cash received and held by the Secured Party after drawing on any Letter of Credit.

"Reference Market Maker" shall mean a leading dealer in the relevant market that is not an affiliate of either party selected by a party determining any disputed calculations pursuant to Paragraph 6 herein in a commercially reasonable manner from among dealers which satisfy all the criteria that such party applies generally at the time in deciding whether to offer or to make an extension of credit. “Rounding Amount” shall mean the amount set forth in the elections on Page 1 herein for a party.

“Secured Party” shall have the meaning set forth in Paragraph 3(b) herein.

"Letter of Credit Issuer Requirements" shall have the meaning set forth in the elections on Page 1 herein.

"Transfer” or “Transferred" shall mean, with respect to any Eligible Collateral, Posted Collateral, or Interest Amount, and in accordance with the instructions of the appropriate party:

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(i) in the case of Cash, payment or delivery by wire transfer in immediately available federal funds into one or more bank accounts set forth on Page 1 herein (or as otherwise specified in a demand Notice);

(ii) in the case of Letters of Credit, delivery of the Letter of Credit by the Pledging Party to the Secured Party at the address specified in this CSA (or as otherwise specified in a demand Notice) or delivery of an executed amendment to such Letter of Credit (extending the term or increasing the amount available to the Secured Party thereunder) by the Pledging Party, to the Secured Party; and for purposes of Paragraph 5, return of the Letter of Credit by the Secured Party to the Pledging Party or delivery of an executed amendment (which amendment shall be given by the Pledging Party to the Secured Party) to the Letter of Credit in form and substance satisfactory to the Secured Party, reducing the amount available to the Secured Party thereunder, in each case to the address specified in the applicable demand letter or this CSA; and

(iii) in the case of any other Eligible Collateral, the Transfer methodology specified by the parties in the elections on Page 1 herein.

(iv) in any case in which Eligible Collateral or Posted Collateral is in the form of a Letter of Credit, the deadlines set forth in Paragraph 7 (h).

(iv) In connection with each Transfer of any Eligible Collateral to the Secured Party pursuant to this CSA, the Secured Party will, upon request of the Pledging Party, provide a receipt in form and substance reasonably satisfactory to the Pledging Party showing the Eligible Collateral Transferred to it. In connection with each Transfer of any Posted Collateral to the Pledging Party pursuant to this CSA, the Pledging Party will, upon request of the Secured Party, provide a receipt in form and substance reasonably satisfactory to the Secured Party showing the Posted Collateral Transferred to it.

“Valuation Percentage” shall mean the percentage set forth in the elections on Page 1 herein for each form of Eligible Collateral; provided with respect to Letters of Credit the Valuation Percentage shall be 100% unless either (i) a Letter of Credit Default shall apply with res pect to such Letter of Credit or (ii) 20 or fewer Business Days remain prior to the expiration of such Letter of Credit, in which case the Valuation Percentage shall be zero (0).

"Value" shall mean the Valuation Percentage multiplied by the amount of Posted Collateral; provided with respect to Letters of Credit, such amount shall be the amount then available to be unconditionally drawn under the Letter of Credit held by the Secured Party.

Paragraph 3. Calculation of Collateral Requirement.

On any Business Day, the " Collateral Requirement " for a party (the “ Pledging Party ”) means the Secured Party’s Exposure minus the sum of:

(a) the Pledging Party's Collateral Threshold; plus

(b) the Value of all Posted Collateral then held by the party other than the Pledging Party (the “Secured Party”), and any accrued Interest Amount that has not yet been Transferred to the Pledging Party;

provided, however, that, the Collateral Requirement of the Pledging Party will be deemed to be zero (0) whenever the calculation of such Pledging Party’s Collateral Requirement yields a number less than zero (0).

OPTION A: Paragraphs 4, 5, and 6
If the parties select Option A of the elections on Page 1 herein, the following Paragraphs 4, 5 and 6 shall apply.

Paragraph 4. Transfer of Eligible Collateral.

On any Business Day on which (i) no Credit Support Default with respect to the Secured Party has occurred and is continuing, (ii) no Event of Default with respect to the Secured Party has occurred and is continuing, (iii) no Early Termination Date has occurred or been designated by the Pledging Party for which there exist any unsatisfied payment obligations under the Base Contract, and (iv) the Pledging Party’s Collateral Requirement equals or exceeds its Minimum Transfer Amount, the Secured Party may deman d, by Notice to the Pledging Party, that the Pledging Party

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Transfer to the Secured Party, and the Pledging Party shall Transfer or cause to be Transferred to the Secured Party, Eligible Collateral for the benefit of the Secured Party having a Value on the date of Transfer at least equal to the Pledging Party’s Collateral Requirement. The amount of Eligible Collateral required to be Transferred hereunder shall be rounded up to the nearest integral multiple of the Rounding Amount. Unless otherwise agreed to in writing by the parties, the Pledging Party shall Transfer the Eligible Collateral by the Close of Business on the Business Day following the Demand Date. Any Letter of Credit or other type of Eligible Collateral (other than Cash) shall be Transferred to the address specified in this CSA or to such address as the Secured Party shall specify in its demand, pursuant to this Paragraph 4. Any demand made by the Secured Party pursuant to this Paragraph 4 shall specify wire transfer information for the account(s) to which Eligible Collateral in the form of Cash shal l be Transferred if different then that set forth in this CSA. Notwithstanding anything to the contrary in this CSA, in the event of a Credit Support Default or an Event of Default, with respect to the Pledging Party which gives rise to an obligation to T ransfer Eligible Collateral, the Pledging Party shall have no obligation to Transfer such Eligible Collateral if such event is cured or otherwise no longer exists prior to the time that such Eligible Collateral is required to be provided hereunder.

Paragraph 5. Reduction and Substitution of Posted Collateral. (a) On any Business Day a Pledging Party may demand, by Notice to the Secured Party, a reduction in the amount of Posted Collateral previously provided by the Pledging Party for the benefit of the Secured Party, and the Secured Party shall comply with said de mand, provided that after giving effect to the demanded reduction in Posted Collateral, (i) the Pledging Party shall have a Collateral Requirement of zero (0) as of the date the Secured Party would be required to return the requested Posted Collateral, (ii) no Credit Support Default with respect to the Pledging Party has occurred and is continuing, (iii) no Event of Default with respect to the Pledging Party has occurred and is continuing, and (iv) no Early Termination Date has occurred or been designat ed by the Secured Party for which there exist any unsatisfied payment obligations under the Base Contract. The amount of the Posted Collateral reduction shall be made by the Secured Party if such amount equals or exceeds the Secured Party’s Minimum Transfer Amount; provided however, such amount actually returned by the Secured Party shall be rounded down to the nearest integral multiple of the Rounding Amount. Unless otherwise agreed in writing by the parties, the Secured Party shall effect a permitted reduction in Posted Collateral by the Close of Business on the Business Day following the Demand Date for such reduction. If a permitted reduction in Posted Collateral is to be effected by a reduction in the amount that may be drawn under an outstanding Letter of Credit previously issued for the benefit of the Secured Party, the Secured Party shall promptly take such action as is reasonably necessary to cooperate with the Pledging Party to effectuate such reduction.
(b) Except when (i) a Credit Support Default with respect to the Pledging Party has occurred and is continuing, or (ii) an Event of Default with respect to the Pledging Party has occurred and is continuing, or (iii) an Early Termination Date has occurred or b een designated by the Secured Party for which there exist any unsatisfied payment obligation under the Base Contract, the Pledging Party may substitute for existing Posted Collateral new Eligible Collateral of equal or greater Value (provided that, if such substitute Eligible Collateral is of a type not designated as Eligible Collateral in the elections on Page 1 herein, then the substitution may not occur unless the Secured Party consents to such substitution). Upon the Transfer to the Secured Party of the substitute Eligible Collateral, the Secured Party shall Transfer the relevant replaced Posted Collateral (as specified by the Pledging Party) to the Pledging Party by the Close of Business on the second Business Day after such Transfer has been effect ed. Notwithstanding anything herein to the contrary, no such substitution shall be permitted unless (x) the substitute Eligible Collateral is Transferred to the Secured Party prior to, the release of the Posted Collateral to be returned to the Pledging Pa rty and, if applicable, the security interest in, and lien upon, such substituted Eligible Collateral granted pursuant hereto in favor of the Secured Party shall have been perfected as required by applicable law and shall constitute a first priority perfec ted security interest therein and general first lien thereon, and (y) after giving effect to such substitution, the Value of such substitute Eligible Collateral, together will all other Posted Collateral held by the Secured Party, shall equal or exceed the Pledging Party’s Collateral Requirement. Each substitution of Eligible Collateral shall constitute a representation, warranty and agreement by the Pledging Party that the substituted Eligible Collateral shall be subject to and governed by the terms and conditions of this CSA, including without limitation and if applicable, the security interest in, general first lien on and right of offset against, such substituted Eligible Collateral granted pursuant to Paragraph 13(a) in favor of the Secured Party.
(c) The Transfer of any Posted Collateral by the Secured Party to the Pledging Party in accordance with this Paragraph 5 shall be deemed a release by the Secured Party of its security interest, general first lien and right of offset granted pursuant to Paragraph 13(a) hereof only with respect to such returned Posted Collateral.

Paragraph 6. Disputed Calculations.

(a) If the Pledging Party disputes the amount of Eligible Collateral requested by the Secured Party and such dispute relates to the amount of the Exposure as determined by the Secured Party, then the Pledging Party shall (i) notify the Secured Party of the existence and nature of the dispute not later than the Close of Business on the Demand

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Date, and (ii) Transfer Eligible Collateral to or for the benefit of the Secured Party in accordance with Paragraph 4 and in an amount equal to the Pledging Party's own calculation of its Collateral Requirement as determined, in accordance with Paragraph 3 . Such calculation shall be made in good faith and a commercially reasonable manner that is consistent with Section 10 of the Base Contract. In all such cases, the parties thereafter shall promptly consult with each other in order to reconcile the two conflicting calculations. If the parties have not been able to resolve their dispute on or before the Notification Time on the second Business Day following the Demand Date, then the amount of the Exposure shall be recalculated with each party requesting qu otations from one (1) Reference Market -Maker by the Notification Time on the third (3 rd) Business Day following the Demand Date (taking the arithmetic average of those quotations obtained to obtain the average Exposure, provided, that, if only one (1) quotation can be obtained, then that quotation shall be used and if no quotations can be obtained, then the Secured Party’s calculation shall control) for the purpose of recalculating the Exposure of each transaction in respect of which the parties disagree as to the Exposure thereof. The Pledging Party shall inform the Secured Party of the quotation it has obtained, if any, by the Notification Time on the third (3 rd) Business Day following the Demand Date. The Secured Party shall inform the Pledging Party of the results of such recalculation in reasonable detail by the Notification Time on the fourth (4th) Business Day following the Demand Date. Eligible Collateral shall thereupon be provided, returned, or reduced, if necessary, by the Close of Business on the fifth (5 th) Business Day following the Demand Date. If the Pledging Party fails to dispute the amount of the Collateral requirement within the time period specified above, then the Pledging Party shall Transfer or cause to be Transferred to the Secured Party, Eligible Collateral for the benefit of the Secured Party having a Value on the date of Transfer at least equal to the Pledging Party's Collateral Requirement, as originally demanded by the Secured Party.

(b) If the Secured Party disputes the amount of Eligible Collateral to be reduced by the Secured Party and such dispute relates to the amount of the Exposure claimed by the Pledging Party, then the Secured Party shall (i) notify the Pledging Party of the exis tence and nature of the dispute by the Close of Business on the Demand Date for such reduction, and (ii) effect the reduction of Eligible Collateral to or for the benefit of the Pledging Party in accordance with Paragraph 5 and in an amount equal to the Secured Party's own estimate, made in a commercially reasonable manner, of the Pledging Party’s Collateral Requirement as determined in accordance with Paragraph 3. In all such cases, the parties thereafter shall promptly consult with each other in order to reconcile the two conflicting amounts. If the parties have not been able to resolve their dispute on or before the Notification Time on the second (2nd) Business Day following the Demand Date for such reduction, then the Secured Party’s Exposure shall be recalculated by each party requesting quotations from one (1) Reference Market-Maker by the Notification Time on the third (3rd) Business Day following the Demand Date for such reduction (taking the arithmetic average of those quotations obtained to obtain the average Exposure; provided, that, if only one (1) quotation can be obtained, then that quotation shall be used and if no quotations can be obtained, then the Secured Party’s calculations shall control) for the purpose of recalculating the Exposur e of each transaction in respect of which the parties disagree as to the Exposure thereof. The Pledging Party shall inform the Secured Party of the quotation it has obtained, if any, by the Notification Time on the third (3rd) Business Day after the Demand Date. The Secured Party shall inform the Pledging Party of the results of such recalculation in reasonable detail by the Notification Time on the fourth (4 th) Business Day after the Demand Date for such reduction. Eligible Collateral shall thereupon be provided, returned, or reduced, if necessary, by the Close of Business on the fifth (5 th) Business Day after the Demand Date for such reduction. If the Secured Party fails to dispute the amount of the demanded reduction within the time period specified above, then the Secured Party shall Transfer or cause to be Transferred to the Pledging Party, Eligible Collateral for the benefit of the Pledging Party having a Value on the date of Transfer at least equal to the Pledging Party's demanded reduction.

OPTION B: Paragraphs 4, 5, and 6
If the parties select Option B of the elections on Page 1 herein, the following Paragraphs 4, 5 and 6 and the related timing requirements and party information set forth in the Exhibit A to this CSA shall apply.

Paragraph 4. Transfer of Eligible Collateral.

On any Business Day on which (i) no Credit Support Default with respect to the Secured Party has occurred and is continuing, (ii) no Event of Default with respect to the Secured Party has occurred and is continuing, (iii) no Early Termination Date has occurred or been designated by the Pledging Party for which there exist any unsatisfied payment obligations under the Base Contract, and (iv) the Pledging Party’s Collateral Requirement equals or exceeds its Minimum Transfer Amount, the Secured Party may deman d, by Notice to the Pledging Party, that the Pledging Party Transfer to the Secured Party, and the Pledging Party shall Transfer or cause to be Transferred to the Secured Party, Eligible Collateral for the benefit of the Secured Party having a Value on the date of Transfer at least equal to the Pledging Party’s Collateral Requirement. The amount of Eligible Collateral required to be Transferred hereunder shall be rounded up to the nearest integral multiple of the Rounding Amount. Unless otherwise agreed t o in writing by the parties, the Pledging Party shall Transfer the Eligible Collateral by the Close of Business on the (‘A’) Business Day following the Demand Date. Any Letter of Credit or other type of Eligible Collateral (other than Cash) shall be Transferred to the address specified in this CSA or to such address as the Secured Party shall specify in its demand, pursuant to this Paragraph 4. Any demand made by the Secured Party pursuant to this Paragraph 4 shall specify wire transfer information for the account(s) to which Eligible Collateral in the form of Cash shall be Transferred if different

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then that set forth in this CSA. Notwithstanding anything to the contrary in this CSA, in the event of a Credit Support Default or an Event of Default, with respect to the Pledging Party which gives rise to an obligation to Transfer Eligible Collateral, the Pledging Party shall have no obligation to Transfer such Eligible Collateral if such event is cured or otherwise no longer exists prior to the time that such Eligible Collateral is required to be provided hereunder.

Paragraph 5. Reduction and Substitution of Posted Collateral. (a) On any Business Day a Pledging Party may demand, by Notice to the Secured Party, a reduction in the amount of Posted Collateral previously provided by the Pledging Party for the benefit of the Secured Party, and the Secured Party shall comply with said de mand, provided that after giving effect to the demanded reduction in Posted Collateral, (i) the Pledging Party shall have a Collateral Requirement of zero (0) as of the date the Secured Party would be required to return the requested Posted Collateral; (ii) no Credit Support Default with respect to the Pledging Party has occurred and is continuing; (iii) no Event of Default with respect to the Pledging Party has occurred and is continuing; and (iv) no Early Termination Date has occurred or been designat ed by the Secured Party for which there exist any unsatisfied payment obligations under the Base Contract. The amount of the Posted Collateral reduction shall be made by the Secured Party if such amount equals or exceeds the Secured Party’s Minimum Transfer Amount; provided however, such amount actually returned by the Secured Party shall be rounded down to the nearest integral multiple of the Rounding Amount. Unless otherwise agreed in writing by the parties, the Secured Party shall effect a permitted reduction in Posted Collateral by the Close of Business on the (‘B’) Business Day following the Demand Date for such reduction. If a permitted reduction in Posted Collateral is to be effected by a reduction in the amount that may be drawn under an outstandin g Letter of Credit previously issued for the benefit of the Secured Party, the Secured Party shall promptly take such action as is reasonably necessary to cooperate with the Pledging Party to effectuate such reduction.
(b) Except when (i) a Credit Support Default with respect to the Pledging Party has occurred and is continuing, or (ii) an Event of Default with respect to the Pledging Party has occurred and is continuing or (iii) an Early Termination Date has occurred or be en designated by the Secured Party for which there exist any unsatisfied payment obligation under the Base Contract, the Pledging Party may substitute for existing Posted Collateral new Eligible Collateral of equal or greater Value on the (‘C’) Business Day following the Demand Date thereof (provided that, if such substitute Eligible Collateral is of a type not designated as Eligible Collateral in the elections on Page 1 herein, then the substitution may not occur unless the Secured Party consents to such substitution). Upon the Transfer to the Secured Party and/or its Custodian of the substitute Eligible Collateral, the Secured Party and/or its Custodian shall Transfer the relevant replaced Posted Collateral (as specified by the Pledging Party) to the Pl edging Party by the Close of Business on the (‘D’) Business Day after such Transfer has been effected. Notwithstanding anything herein to the contrary, no such substitution shall be permitted unless (x) the substitute Eligible Collateral is Transferred to the Secured Party and/or its Custodian simultaneously with, or has been Transferred to the Secured Party and/or its Custodian prior to, the release of the Eligible Collateral to be returned to the Pledging Party and, if applicable, the security interest i n, and lien upon, such substituted Eligible Collateral granted pursuant hereto in favor of the Secured Party shall have been perfected as required by applicable law and shall constitute a first priority perfected security interest therein and general first lien thereon, and (y) after giving effect to such substitution, the Value of such substitute Eligible Collateral, together will al l other Posted Collateral held by the Secured Party, shall equal or exceed the Pledging Party’s Collateral Requirement.

Each substitution of Eligible Collateral shall constitute a representation, warranty and agreement by the Pledging Party that the substituted Eligible Collateral shall be subject to and governed by the terms and conditions of this CSA, including without limitation and if applicable, the security interest in, general first lien on and right of offset against, such substituted Eligible Collateral granted pursuant to Paragraph 13(a) in favor of the Secured Party. (c) The Transfer of any Eligible Collateral by the Secured Party and/or its Custodian to the Pledging Party in accordance with this Paragraph 5 shall be deemed a release by the Secured Party of its security interest, general first lien and right of offset granted pursuant to Paragraph 13(a) hereof only with respect to such returned Eligible Collateral.

Paragraph 6. Disputed Calculations.

(a) If the Pledging Party disputes the amount of Eligible Collateral requested by the Secured Party and such dispute relates to the amount of the Exposure as determined by the Secured Party, then the Pledging Party shall (i) notify the Secured Party of the ex istence and nature of the dispute not later than the Close of Business on the (‘A’) Business Day following the Demand Date that the demand for Eligible Collateral is made by the Secured Party pursuant to Paragraph 4, and (ii) Transfer Eligible Collatera l to or for the benefit of the Secured Party in accordance with Paragraph 4 and in an amount equal to the Pledging Party's own calculation of its Collateral Requirement, in accordance with Paragraph 3. Such calculation shall be made in good faith and a co mmercially reasonable manner that is consistent with Section 10 of the Base Contract. In all such cases, the parties thereafter shall promptly consult with each other in order to reconcile the two conflicting calculations. If the parties have not been ab le to resolve their dispute on or before the Notification Time on the (‘E’) Business Day following the Demand Date, then the amount of the Exposure shall be recalculated with each party requesting quotations from one (1) Reference Market-Maker by the

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Notification Time on the (‘F’) Business Day following the Demand Date (taking the arithmetic average of those quotations obtained to obtain the average Exposure, provided, that, if only one (1) quotation can be obtained, then that quotation shall be used and if no quotations can be obtained, then the Secured Party’s calculation shall control) for the purpose of recalculating the Exposure of each transaction in respect of which the parties disagree as to the Exposure thereof. The (‘A1’) Party shall inform the (‘A2’) Party of the quotation it has obtained, if any, by the Notification Time on the (‘G’) Business Day following the Demand Date. The (‘A3’) Party shall inform the (‘A4’) Party of the results of such recalculation in reasonable detail by the Notification Time on the (‘H’) Business Day following the Demand Date. Eligible Collateral shall thereupon be provided, returned, or reduced, if necessary, by the Close of Business on the (‘I’) Business Day following the Demand Date. If the Pledging Party fails to dispute the amount of the Collateral requirement within the time period specified above, then the Pledging Party shall Transfer or cause to be Transferred to the Secured Party, Eligible Collateral for the benefit of the Secured Party having a Value on the date of Transfer at least equal to the Pledging Party's Collateral Requirement, as demanded by the Secured Party.

(b) If the Secured Party disputes the amount of Eligible Collateral to be reduced by the Secured Party and such dispute relates to the amount of the Exposure claimed by the Pledging Party, then the Secured Party shall (i) notify the Pledging Party of the existence and nature of the dispute by the Close of Business on the (‘J’) Business Day following the Demand Date for such reduction, and (ii) effect the reduction of Eligible Collateral to or for the benefit of the Pledging Party in accordance with Paragrap h 5 and in an amount equal to the Secured Party's own estimate, made in a commercially reasonable manner, of the Pledging Party’s Collateral Requirement in accordance with Paragraph 3. In all such cases, the parties thereafter shall promptly consult with each other in order to reconcile the two conflicting amounts. If the parties have not been able to resolve their dispute on or before the Notification Time on the (‘K’) Business Day following the Demand Date for such reduction, then the Secured Party’s Exposure shall be recalculated by each party requesting quotations from one (1) Reference Market-Maker by the Notification Time on the (‘L’) Business Day following the Demand Date for such reduction (taking the arithmetic average of those quotations obtained to obtain the average Exposure; provided, that, if only one (1) quotation can be obtained, then that quotation shall be used and if no quotations can be obtained, then the Pledging Party’s calculations shall control) for the purpose of recalculating the Exposure of each transaction in respect of which the parties disagree as to the Exposure thereof. The (‘A5’) Party shall inform the (‘A6’) Party of the quotation it has obtained, if any, by the Notification Time on the (‘M’) Business Day after the Demand Date. The (‘A7’) Party shall inform the (‘A8’) Party of the results of such recalculation in reasonable detail by the Notification Time on the (‘N’) Business Day after the Demand Date for such reduction. Eligible Collateral shall thereupon be provided, re turned, or reduced, if necessary, by the Close of Business on the (‘O’) Business Day after the Demand Date for such reduction. If the Secured Party fails to dispute the amount of the demanded reduction within the time period specified above, then the Secured Party shall Transfer or cause to be Transferred to the Pledging Party, Eligible Collateral for the benefit of the Pledging Party having a Value on the date of Transfer at least equal to the Pledging Party's demanded reduction.

Paragraph 7. Letters of Credit.

Eligible Collateral provided in the form of a Letter of Credit shall be subject to the following provisions.

(a) Each “Letter of Credit” shall be an irrevocable, transferable, standby letter of credit, issued by an entity that meets the requirements of a Letter of Credit Issuer Requirements set forth in the elections on Page 1 herein in a form reasonably acceptable to the Secured Party.
(b) “Letter of Credit Default” shall mean with respect to an outstanding Letter of Credit that is held by the Secured Party as Posted Collateral the occurrence of any of the following events: (i) the issuer of such Letter of Credit shall fail to meet the Lette r of Credit Issuer Requirements set forth in the elections on Page 1 herein, (ii) the issuer of such Letter of Credit goes bankrupt; (iii) the issuer of the Letter of Credit shall fail to comply with or perform its obligations under such Letter of Credit i f such failure shall be continuing after the lapse of any applicable grace period; (iv) the issuer of such Letter of Credit shall disaffirm, disclaim, repudiate or reject, in whole or in part, or challenge the validity of, such Letter of Credit; or (v) suc h Letter of Credit shall expire or terminate, or shall fail or cease to be in full force and effect (other than in accordance with its terms) prior to the satisfaction of all obligations of the Pledging Party under each transaction to which such Letter of Credit shall relate without the written consent of the other party; provided, however, that no Letter of Credit Default shall occur in any event with respect to a Letter of Credit after the time such Letter of Credit is required to be canceled or returned to the Pledging Party in accordance with the terms of this CSA. Upon the occurrence of a Letter of Credit Default, the Pledging Party agrees to Transfer to the Secured Party either a substitute Letter of Credit or other Eligible Collateral, in each case on or before the second Business Day after the occurrence thereof (or the fifth (5) Business Day after the occurrence thereof if and only if clause (i) under the definition of Letter of Credit Default applies).
(c) Unless otherwise agreed in writing by the parties, each Letter of Credit shall be provided in accordance with this Paragraph 7 and each Letter of Credit shall be maintained for the benefit of the Secured Party. The Pledging Party shall (i) renew or cause the renewal of each outstanding Letter of Credit on a timely basis as

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provided in the relevant Letter of Credit, (ii) Transfer either a substitute Letter of Credit or other Eligible Collateral, in each case at least twenty (20) Business Days prior to the expiration of the outstanding Letter of Credit, and (iii) Transfer for the benefit of the Secured Party either a substitute Letter of Credit or other Eligible Collateral, in each case within one (1) Business Day, if the bank issuing a Letter of Credit shall fail to honor the Secured Party’s properly documented requ est to draw on an outstanding Letter of Credit, provided that, as a result of the Pledging Party’s failure to perform in accordance with (i), (ii), or (iii) above, the Pledging Party’s Collateral Requirement would be greater than zero (0). (d) As one method of providing Posted Collateral, the Pledging Party may increase the amount of an outstanding Letter of Credit or establish one or more additional Letters of Credit. (e) Upon or at any time after the occurrence of an Event of Default with respect to the Pledging Party and/or the designation of an Early Termination Date by the Secured Party, the Secured Party may draw on the entire undrawn portion of any outstanding Letter( s) of Credit upon submission to the bank issuing such Letter of Credit in accordance with the specific requirements of the Letter of Credit. Cash proceeds received from drawing upon the Letter of Credit shall be deemed Posted Collateral as security for th e Pledging Party’s obligations to the Secured Party and the Secured Party shall have the rights and remedies set forth in this CSA with respect to such Cash proceeds. Notwithstanding the Secured Party’s receipt of Cash under the Letter of Credit, the Pledging Party shall remain liable (i) for any failure to Transfer sufficient Posted Collateral, and (ii) for any amounts owing to the Secured Party and remaining unpaid after the application of the amounts so drawn by the Secured Party.
(f) A Pledging Party may substitute a Letter of Credit for one or more other outstanding Letter(s) of Credit issued for the benefit of the Secured Party, provided that the Value of such substitute Letter of Credit shall be at least equal to the Value of the Letter(s) of Credit being replaced, and provided further that no Letter of Credit shall be canceled unless and until the Letter of Credit to be substituted therefor shall have been validly executed, issued and Transferred for the benefit of the Secured Party in accordance with applicable law. (g) In all cases, the costs and expenses incurred by the Pledging Party to establish, renew, substitute, cancel, and/or increase the amount of (as the case may be) a Letter of Credit shall be borne by the Pledging Party. (h) In any case in which Eligible Collateral or Posted Collateral is in the form of a Letter of Credit (which permits draws based on a facsimile copy), the deadlines set forth in this CSA for providing such collateral to the other party may be met by providing a facsimile copy of the Letter of Credit with an original transmitted by overnight courier for delivery on the next Business Day.

Paragraph 8. Care and Use of Cash.

Eligible Collateral provided in the form of Cash shall be subject to the following provisions.

(a) Eligibility to Hold Cash.

(i) If a party is not eligible to hold Cash as set forth in the elections on Page 1 herein, then such Cash shall be held in a Collateral Account in accordance with the provisions of Paragraph 8(e).

(ii) The Secured Party or its Custodian will be entitled to hold Cash provided that the following conditions, as applicable, are satisfied: (1) the Secured Party is not a Defaulting Party, (2) the Secured Party or its Credit Support Provider, if applicable, meets the Eligibility Requirements to Hold Cash requirements set forth in the elections on Page 1 herein, (3) Cash shall be held only in any jurisdiction within the United States, and (4) the Custodian meets the Custodian Requirements set forth in the el ections on Page 1 herein. If a party or its Custodian is not eligible, or subsequently becomes ineligible, to hold Posted Collateral pursuant to this Section, then it shall be considered a “Downgraded Party” or a “Downgraded Custodian”, as the case may be, and Posted Collateral shall be maintained in accordance with Paragraph 8(e).

(iii) Upon Notice by the Secured Party to the Pledging Party of the appointment of a Custodian, the Pledging Party’s obligations to make any Transfer will be discharged by making the Transfer to that Custodian.

The holding of Cash by a Custodian will be deemed to be the holding of Cash by the Secured Party for which the Custodian is acting. The Secured Party will be liable for the acts or omissions of its Custodian to the same extent that the Secured Party would be liable hereunder for its own acts or omissions.

(b) Use of Cash. Notwithstanding the provisions of applicable law, if the Secured Party is eligible to hold cash in accordance with Paragraph 8(a), is not a Defaulting Party and no Early Termination Date has occurred or been designated by the Pledging Party as a result of an Event of Default with respect to the Secured Party, then the Secured Party shall have the right to sell, pledge, rehypothecate, assign, invest, use, commingle or

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otherwise dispose of, or otherwise use in its business any Cash it holds, free from any claim or right of any nature whatsoever of the Pledging Party, including any equity or right of redemption by the Pledging Party.

(c) Interest Payments on Cash. So long as no Event of Default with respect to the Pledging Party has occurred and is continuing, and no Early Termination Date (for which any unsatisfied payment obligations of the Pledging Party exist) has occurred or been designated as the result of an Event of Default with respect to the Pledging Party and to the extent that an obligation to Transfer Posted Collateral would not be created or increased by the Transfer, the Secured Party will upon written request Transfer t o the Pledging Party, in lieu of any interest or other amounts paid or deemed to have been paid with respect to the Cash (all of which may be retained by the Secured Party), the Interest Amount on the third Business Day of each calendar month.

On or after the occurrence of an Event of Default with respect to the Pledging Party or an Early Termination Date as a result of an Event of Default with respect to the Pledging Party, the Secured Party shall retain any such Interest Amount as additional Eligible Col lateral hereunder until the obligations of the Pledging Party under the Base Contract have been satisfied.

(d) Care of Cash . Without limiting the Secured Party’s rights under Paragraph 8(b), the Secured Party will exercise reasonable care to assure the safe custody of all Cash held by it as Posted Collateral to the extent required by applicable law, and in any event the Secured Party will be deemed to have exercised reasonable care if it exercises at least the same degree of care as it would exercise with respect to its own property.

Except as specified in the preceding sentence, the Secured Party will have no dut y with respect to Cash, including, without limitation, any duty to enforce or preserve any rights pertaining thereto.

(e) Holding of Cash by a Custodian. The provisions of Paragraph 8(b) will apply to the parties; provided, however, that if a party or its Custodian is not eligible to hold Cash pursuant to Paragraph 8(a) (the event that caused it or its Custodian, if any, to be ineligible to hold Cash shall be a “Credit Rating Event”; if such Credit Rating Event occurs with respect t o a party, such party shall be the “Downgraded Party”; and if such Credit Rating Event occurs with respect to a party’s Custodian, such Custodian shall be the “Downgraded Custodian”), then:
(1) the provisions of Paragraph 8(b) will not apply with respect to the Downgraded Party as the Secured Party for so long as either the Secured Party or its Custodian, if any, remain a Downgraded Party or a Downgraded Custodian, respectively, and (2) the Downgraded Party shall be required to deliver (or cause the Downgraded Custodian to deliver, as the case may be) by the Close of Business on the second (2nd) Business Day following such Credit Rating Event all Cash in its possession or held on its behalf (i) to a Custodian that meets the Custodian Requirements, and (ii) to a segregated, safekeeping or custody account (“Collateral Account”) within such Custodian with the title of the Collateral Account indica ting that the property contained therein is being held as Posted Collateral for the Downgraded Party; provided, that, if the Credit Rating Event occurs with respect to a party’s Custodian that is holding Posted Collateral on behalf of such party, then such Downgraded Custodian may also deliver such Posted Collateral to such party if such party is not a Downgraded Party, and (iii) the parties agree to enter into a control agreement (“Control Agreement”) with the Custodian maintaining the Collateral Account. The Control Agreement shall be in such form as shall be reasonably acceptable to each of the parties and shall provide for such items as the timing and release of the funds in the Collateral Account and the investment and reinvestment of Cash held in the C ollateral Account.

The Control Agreement shall further provide that Custodian shall serve as Custodian with respect to the Posted Collateral in the Collateral Account, and shall hold such Posted Collateral in accordance with the terms of this CSA and for the security interest of the Downgraded Party and, subject to such security interest, for the ownership of the non-Downgraded Party. The parties further agree that notwithstanding the fact that Cash is being held by a Custodian in a Collateral Account pur suant to a Control Agreement, the Downgraded Party shall be required to make interest payments to the non-Downgraded Party in an amount equal to the Interest Amount in accordance with the provisions of Paragraph 8(c).

Paragraph 9. Notices

(a) “Notice” shall mean a notice or other communication in respect of this CSA. Notice may be given in any manner set forth below to the address or number or in accordance with the electronic messaging system details provided on Page 1 of this CSA and will be deemed effective as indicated:

(i) if in writing and delivered in person or by courier, on the Business Day it is delivered;

(ii) if sent by facsimile transmission, on the date that transmission is received by the recipient in legible form (which may be evidenced by a transmission report generated by the sender's facsimile machine) unless such facsimile transmission is received on a non-Business Day or after the Close of Business then such facsimile shall be deemed to have been received on the next following Business Day.

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(iii) if sent by certified or registered mail or the equivalent (return receipt requested), on the Business Day that mail is delivered or its delivery is attempted; or

(iv) if sent by electronic messaging system, on the date that electronic message is received, unless such electronic message is received on a non -Business Day or after the Close of Business, then such electronic message shall be deemed to have been received on the next following Business Day.

(b) Any other Notice, including but not limited to, Notice of an Event of Default, must be given pursuant to Section 9 of the Base Contract.

Paragraph 10. Credit Support Default

(a) A “Credit Support Default" shall exist with respect to a party (the "Defaulting Party") if:

(i) a party fails (or fails to cause its Custodian, as applicable) to make, when due, any Transfer of Eligible Collateral, Posted Collateral or the Interest Amount, as applicable, required to be made by it, and such failure continues for one (1) Business Day after Notice of that failure is provided to that party; or

(ii) a party fails to comply with or perform any material agreement or obligation provided for in this CSA, and such failure continues for one (1) Business Day after Notice of that failure is provided to that party; or

(iii) a party or its Custodian fails to comply with any of the obligations under Paragraph 8 herein and the failure continues for one (1) Business Day after notice of the failure is given to that party.

(b) Credit Support Default shall constitute and have the effect of an Event of Default set forth in Section 10.2 (vi) of the Base Contract.

Paragraph 11. Representations and Warranties.

Each party continuously represents and warrants to the other party that: (a) it has the power and authority under the law of the jurisdiction of its organization or incorporation and under its organizational and constituent documents to grant to the Secured Party a valid, enforceable, first-priority security interest in, and lien on, all Posted Collateral (other than Letters of Credit) that it Transfers as the Pledging Party, and has taken all necessary actions to authorize the granting and perfection of that security interest and lien; (b) as of each date on which it, as the Pledging Party, Transfers Eligible Collateral to the Secured Party or to any agent of the Secured Party for the benefit of the Secured Party (or, in the case of after-acquired Posted Collateral, at the time the Secured Party or its agent acquires rights therein), it has title to, and will be the sole owner of such Eligible Collateral, free and clear of any security interest, lien, pledge, charge, encumbrance, or other interests or restrictions other than the security interest granted to the Secured Party hereby; (c) the Secured Party will have a valid and perfected first -priority security interest in, and lien on, all Posted Collateral (other than Letters of Credit) upon receipt thereof; (d) the performance by it of its obligations under this CSA will not result in the creation of any security interest, lien or other encumbrance on any Posted Collateral other than the security interest and lien granted pursuant to this CSA; and (e) in connection with the delivery, issuance, renewal, substitution, or increase (as the case may be) which constitutes a Transfer of a Letter of Credit, such Letter of Credit is the legal, valid and binding obligation of the Issuer thereof, enforceable in accordance with its terms.

Paragraph 12. Certain Rights and Remedies.

(a) Secured Party’s Rights and Remedies. If at any time (i) an Event of Default with respect to the Pledging Party has occurred and is continuing, or (ii) an Early Termination Date has occurred or been designated as a result of an Event of Default with respect to the Pledging Party, then the S ecured Party may do any one or more of the following: (x) exercise any of the rights and remedies of a secured party with respect to the Posted Collateral, including any such rights and remedies under law then in effect; (y) exercise its rights of setoff against any and all property of the Pledging Party in the possession of the Secured Party or its agent; and (z) draw on any outstanding Letter of Credit issued for its benefit under its terms and this CSA. The Secured Party shall either (y) apply the proceeds of the Posted Collateral realized upon the exercise of any such rights or remedies to reduce the Pledging Party's obligations under the Base Contract or this CSA (the Pledging Party remaining liable for any amounts owing to the Secured Party after such application), subject to the Secured Party’s obligation to return any surplus proceeds remaining after such obligations are satisfied in full and/or (z) hold such proceeds as collateral security for the Pledging Party's obligations under the Base Contract or this CSA, subject to the Secured Party’s obligation to return the proceeds after such obligations are satisfied in full.

___________________________________________________________________________________________________________ Copyright © 2003 North American Energy Standards Board, Inc. Model Credit Support Addendum All Rights Reserved Page 12 Adopted October 9, 2003
(b) Pledging Party's Rights and Remedies . If at any time an Early Termination Date has occurred or been designated as the result of an Event of Default with respect to the Secured Party, then: (i) the Secured Party will be obligated immediately to Transfer all Posted Collateral and the Interest Amount, if any, to the Pledging Party; and (ii) the Pledging Party may do any one or more of the following: (x) exercise any of the rights and remedies of a pledgor with respect to the Posted Collateral, including any such rights and remedies under law then in effect; (y) to the extent that the Posted Collateral or the Interest Amount is not Transferred to the Pledging Party as required in (i) above, setoff amounts payable by the Pledging Party to the Secured Party against the Posted Collateral held by the Secured Party or to the extent its rights to setoff are not exercised, withhold payment of any remaining amounts payable by the Pledging Party, up to the value of any remaining Posted Collateral held by the Secured Party, until the Posted Collateral is Transferred to the Pledging Party; and/or (z) exercise rights and remedies available to the Pledging Party under the terms of any Letter of Credit.

Paragraph 13. General.

(a) To secure its obligations under the Base Contract and all outstanding transactions, each party, as the Pledging Party, hereby grants to the other party, as the Secured Party, a present and continuing first -priority security interest in, and lien on (and r ight of setoff against), all Posted Collateral (other than Letters of Credit) Transferred to the Secured Party hereunder. Each party agrees to take such action as the other party reasonably requires in order to perfect or maintain the other party’s first-priority continuing security interest in, and lien on (and right of setoff against), such Posted Collateral.

(b) Each party will pay its own costs and expenses in connection with performing its obligations under this CSA and neither party will be liable for any costs or expenses incurred by the other party in connection herewith.

(c) This CSA has been and is made solely for the benefit of the parties and their permitted successors and assigns, and no other entity shall acquire or have any right under or by virtue of this CSA.

(d) No failure or delay by either party hereto in exercising any right, power, privilege, or remedy hereunder shall operate as a waiver thereof.
(e) The headings in this CSA are for convenience of reference only, and shall not affect the meaning or construction of any provision thereof.

DISCLAIMER: The purposes of this CSA are to facilitate trade, avoid misunderstandings and make more definite the terms of margining arrangements related to contracts of purchase and sale of natural gas. Further, NAESB does not mandate the use of this CSA by any party. NAESB DISCLAIMS AND EXCLUDES, AND ANY USER OF THIS CSA ACKNOWLEDGES AND

AGREES TO NAESB'S DISCLAIMER OF, ANY AND ALL WARRANTIES, CONDITIONS OR REPRESENTATIONS,

EXPRESS OR IMPLIED, ORAL OR WRITTEN, WITH RESPECT TO THIS CSA OR ANY PART THEREOF, INCLUDING

ANY AND ALL IMPLIED WARRANTIES OR CONDITIONS OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY, OR

FITNESS OR SUITABILITY FOR ANY PARTICULAR PURPOSE (WHETHER OR NOT NAESB KNOWS, HAS REASON

TO KNOW, HAS BEEN ADVISED, OR IS OTHERWISE IN FACT AWARE OF ANY SUCH PURPOSE), WHETHER ALLEGED TO ARISE BY LAW, BY REASON OF CUSTOM OR USAGE IN THE TRADE, OR BY COURSE OF DEALING.

EACH USER OF THIS CSA ALSO AGREES THAT UNDER NO CIRCUMSTANCES WILL NAESB BE LIABLE FOR ANY

DIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES ARISING OUT OF ANY USE OF THIS CSA.

City Council
Communication
Meeting Date: 11/5/2025
Item #: VII.17
File #: 0203-07
Item ID: 2025-744

Title: Light Duty Steel Poles (RFQ 10-3425) — Purchase Orders Contact: Sue Jessup 916-746-1107 [email protected]

SUMMARY
Staff recommends approval of purchase orders with MVA Power, Inc. for the purchase of light-duty steel poles in response to Request for Quotations (RFQ) No. 10-3425. The estimated cost for FY2025-26 is $500,000. Estimated spending for the optional renewal years of FY2026-27 through FY2029-30 is $900,000 per fiscal year. Funding for this purchase is included in the FY2025-26 Electric Fund budget.

RECOMMENDATION
Staff recommends that the City Council adopt a resolution to approve open purchase orders with MVA Power, Inc. as the lowest responsive and responsible bidder for the purchase of light-duty steel poles in response to RFQ 10-3425.

The bid allowed for four optional renewal years at one-year intervals. Staff requests authorization to continue utilizing the remaining optional renewal years without further Council approval, provided that the applicable budget is approved by the City Council each year until the contract expires or until City staff determines that continuing with the same vendor is not in the City's best interest.

BACKGROUND
The Electric Department has an ongoing need for light-duty steel poles to support construction and maintenance activities that comply with California Public Utilities Commission (CPUC) requirements. The Department currently maintains over 4,000 wood poles in its distribution system, which are required to be tested on a continuous basis. These tests identify poles that no longer meet CPUC standards and must be replaced. In some instances, the most suitable replacement for these wood poles is a light-duty steel pole.

The Electric Department is also required to upgrade wood poles when new facilities are attached to existing poles that would exceed allowable CPUC load calculations. In many instances, this necessitates replacing the pole with a light-duty steel pole. The Department plans to initially purchase a minimum of 26 light-duty steel poles this year to support maintenance and capital projects.

Bidders were asked to quote unit pricing for all sizes and types of light-duty steel poles used by the Electric Department and to provide the sum of all unit prices (total below). Purchases will be made for a variety of poles on an as-needed basis throughout the fiscal year. The difference between the bid total and the estimated annual spend is because of the potential for higher-than-usual requirements if needed.

A formal bid was issued with the following responses:

Bidder: Total MVA Power Inc. $329,726.15

Montreal, Quebec

Mader Supply, LLC $364,915.00 North Highlands, CA

Anixter Inc. $370,673.31 Benicia, CA

Meyer Utility Structures $384,275.00 Memphis, TN

TransAmerican Power Products, Inc. $437,833.00 Houston, TX

General Pacific $517,927.00 Fairview, OR

Sierra Utility Sales $552,067.00 Santa Cruz, CA

Sabre Industries, Inc. $815,430.00 Alvarado, TX

FISCAL IMPACT
The estimated cost for FY2025-26 is $500,000, which is included in the FY2025-26 Electric Fund budget.

Spending in future years will be contingent upon Council approval of the applicable budgets. Estimated expenditures for the optional renewal years (FY2026-27 through FY2029-30) are $900,000 per fiscal year.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQAState Guidelines §15060(c)(3) and §15378.

Approval of a purchase order for light duty steel poles meets the above criteria and is not subject to CEQA.

No additional environmental review is required.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS

4. Invest in well-planned infrastructure and growth

Respectfully Submitted,
Sue Jessup, Buyer

Scott Pettingell, Finance Director

ATTACHMENTS:

1. Resolution 25-336

2. RFQ 10-3425 Bid Summary

REVIEWERS:

Sue Jessup, Finance Department - Purchasing Created/Initiated - 10/3/2025 Shannon Wiest, Finance Department - Purchasing Approved - 10/14/2025 Scott Pettingell, Finance Department - Budget Approved - 10/16/2025 Kelly Aye, City Attorney Department Approved - 10/21/2025 Katrina Six, City Clerk Department Approved - 10/21/2025 Ryan DeVore, City Clerk Department Approved - 10/22/2025 Dennis Kauffman, City Manager Department - Assistant City Manager Approved - 10/23/2025 Michelle Sheidenberger, City Attorney Department Approved - 10/23/2025 Dominick Casey, City Clerk Department Approved - 10/27/2025 Katrina Six, City Clerk Department Final Approval - 10/27/2025

RESOLUTION NO. 25-336

APPROVING A PURCHASE ORDER FOR LIGHT DUTY STEEL POLES

WHEREAS, a purchase order for light duty steel poles, by and between the City of Roseville and MVA Power, Inc., has been reviewed by the City Council; and

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Roseville that said purchase order is approved.

BE IT FURTHER RESOLVED, that the City Manager or his designee is authorized to execute four (4) additional one (1) year renewals without further City Council approval, provided that the applicable budget is approved by the City Council, or until staff determines that continuing with this consultant is not in the best interest of the City.

PASSED AND ADOPTED by the Council of the City of Roseville this ___ day of ______________, 2025, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:

_______________________________
MAYOR

ATTEST:

__________________________
City Clerk

Line Item Bid
Bid Type
ExcelFormat Bid Tabulation Matrix
Version 1
Bid RFQ #10-3425 - Light Duty Steel Poles
End Date 2025-09-18 03:00 PM PDT
Anixter Power
Solutions General Pacific Mader Supply,
LLC mva power inc Sabre Industries,
Inc
Sierra Utility
Sales
TransAmerican
Power Products,
Inc.

Meyer Utility
Structures
Item Code Item Name Item Description Qty Unit Total Price Total Price Total Price Total Price Total Price Total Price Total Price Total Price *Total Sum of all
'Line Totals' from
"Attachment A
Pricing Worksheet"
*This is the Total Sum of all
'Line Totals' from
"Attachment A Pricing
Worksheet". **Transfer the
"Total Sum" from this
spreadsheet to the "Formal
Invitation for Bid and
Award" page of this bid.
1 Each $370,673.31 $517,927.00 $364,915.00 $329,726.15 $815,430.00 $552,067.00 $437,833.00 $384,275.00 Brand
Pacific Steel
Structures CHM Utility MVA POWER INC
Sabre Industries
Inc TAPP, Inc.

Meyer Utility
Structures
Item Vendor Ref
Number 26-29865 25-2460 48043
Vendor

City Council
Communication
Meeting Date: 11/5/2025
Item #: VII.18
File #: 0200
Item ID: 2025-772

Title: Cost Allocation Plan and Indirect Cost Rate Proposal - Professional Services Agreement Amendment
Contact: Nancy Rothlisberger 916-774-5314 [email protected]

SUMMARY
Staff recommends approval of the final optional renewal of the professional services agreement with MGT Impact Solutions, LLC, in the amount of $33,720 which is included in the Finance Department’s FY2025-26 budget to prepare the City’s Cost Allocation Plan and Indirect Cost Rate Proposals for the FY2026-27 budget.

RECOMMENDATION
Staff recommends that the City Council adopt a resolution to approve the third amendment to professional services agreement for the Cost Allocation Plan and Indirect Cost Rate Proposal with MGT Impact Solutions, LLC, and authorize the City Manager to execute it on behalf of the City of Roseville.

BACKGROUND
The City contracts with a financial consultant to prepare an annual Cost Allocation Plan (CAP) and a series of Indirect Cost Rate Proposals (ICRPs). The CAP allocates the City’s indirect costs and ensures that the General Fund recovers costs for services that benefit non-General Fund operations, including enterprise funds and internal service funds. The ICRPs are used to charge indirect costs to capital improvement projects, external agencies, and other funding sources.

The City currently has a Professional Services Agreement (PSA) with MGT Impact Solutions, LLC, to prepare these reports. This final optional renewal of the PSA totals $33,720 and is included in the Finance Department’s FY2025-26 budget.

FISCAL IMPACT
There is no fiscal impact, as the cost of this amendment is already included in the Finance Department’s FY2025-26 appropriations.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and §15378. The amendment to the professional services agreement with MGT Impact Solutions, LLC meets the above criteria and is not subject to CEQA. No additional environmental review is required.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS

2. Remain fiscally responsible in a changing world

Respectfully Submitted,
Nancy Rothlisberger, Budget Manager

Scott Pettingell, Finance Director

ATTACHMENTS:

1. Resolution 25-341

2. Third Amendment - MGT - Signed

REVIEWERS:

Nancy Rothlisberger, Finance Department - Budget Created/Initiated - 10/15/2025 Nancy Rothlisberger, Finance Department - Budget Approved - 10/15/2025 Scott Pettingell, Finance Department - Budget Approved - 10/16/2025 Gretchen Hakala, City Clerk Department Approved - 10/17/2025 Kelly Aye, City Attorney Department Approved - 10/20/2025 Katrina Six, City Clerk Department Approved - 10/22/2025 Ryan DeVore, City Clerk Department Approved - 10/22/2025 Dennis Kauffman, City Manager Department - Assistant City Manager Approved - 10/23/2025 Michelle Sheidenberger, City Attorney Department Approved - 10/23/2025 Dominick Casey, City Clerk Department Approved - 10/27/2025 Katrina Six, City Clerk Department Final Approval - 10/27/2025

RESOLUTION NO. 25-341

APPROVING A THIRD AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT, BY AND BETWEEN THE CITY OF ROSEVILLE AND MGT IMPACT SOLUTIONS, LLC, a

FLORIDA LIMITED LIABILITY COMPANY, SUCCESSOR IN INTEREST TO MGT OF

AMERICA CONSULTING, LLC, AND AUTHORIZING THE CITY MANAGER TO

EXECUTE IT ON BEHALF OF THE CITY OF ROSEVILLE

WHEREAS, a third amendment to professional services agreement for the Cost Allocation Plan and Indirect Cost Rate Proposal, by and between the City of Roseville and MGT Impact Solutions, LLC, a Florida limited liability company, successor in interest to MGT of America Consulting, LLC, has been reviewed by the City Council; and

NOW, THEREFORE, BE IT RESOLVED by the Council of the City of Roseville that said third amendment is hereby approved and that the City Manager is authorized to execute it on behalf of the City of Roseville.

PASSED AND ADOPTED by the Council of the City of Roseville this ___ day of ______________, 2025, by the following vote on roll call:

AYES COUNCILMEMBERS:

NOES COUNCILMEMBERS:

ABSENT COUNCILMEMBERS:

______________________________
MAYOR

ATTEST:

________________________
City Clerk

[B:\City Attorney\corres\Kelly\Contracts 2025\MGT Third Amendment.docx:10/13/2025]

TH IRD AMENDMENT TO

PROFESSIONAL SERVICES AGREEMENT
Cost Allocation Plan and Indirect Cost Rate Proposal
TH
IS THIRD AMENDMENT TO AGREEMENT is made and entered into this ___ day of __________, 20__, by and between the City of Roseville, a municipal corporation (“CITY”), and MGT Impact Solutions, LLC, a Florida limited liability company, successor in interest to MGT of America Consulting, LLC (“CONSULTANT”); and
W I T N E S S E T H:

WHE
REAS, CITY and CONSULTANT previously entered into a Professional Services Agreement dated October 6, 2021, amended on February 21, 2024, and amended on October 2, 2024 (“Agreement”) regarding consisting of preparation of a cost allocation plan and indirect cost rate proposal (“Project”); and
WHEREAS, CITY wishes to exercise its option to extend the term of the Agreement for an additional one (1) year period; and
WHEREAS, CONSULTANT is willing and able to provide such services as described.

NO
W, THEREFORE, the parties agree as follows:

1. CONSULTANT shall provide services as described in Exhibit “A” of this Third Amendment to Agreement.
16th
October
25

[B:\City Attorney\corres\Kelly\Contracts 2025\MGT Third Amendment.docx:10/13/2025]

2. Section 1 of the Agreement is amended by adding an additional paragraph to read as follows:
“CITY is exercising its option to extend the term of the Agreement for an additional one (1) year period commencing on October 6, 2025 and ending on October 5, 2026.”

3. Section 3 of the Agreement is amended by adding an additional paragraph to read as follows:
“CITY shall pay an additional thirty-three thousand, seven hundred twenty dollars ($33,720) in consideration of the Third Amendment to Agreement.”

4. All other provisions of the Agreement shall remain unchanged and in full force and effect.

I
N WITNESS WHEREOF, the City of Roseville, a municipal corporation, has authorized the execution of this Third Amendment to Agreement in duplicate by its City Manager and attested to by its City Clerk under the authority of Resolution No. _________, adopted by the Council of the City of Roseville on the ___ day of ___________, 20__, and CONSULTANT has caused this Third Amendment to Agreement to be executed.

C
ITY OF ROSEVILLE, a MGT IMPACT SOLUTIONS, LLC, a
municipal corporation Florida limited liability company B
Y: _______________________________ BY: _______________________________ DOMINICK CASEY its: _______________________________
City Manager
[
SIGNATURES CONTINUED ON FOLLOWING PAGE]
A. Trey Traviesa
10/16/2025

[B:\City Attorney\corres\Kelly\Contracts 2025\MGT Third Amendment.docx:10/13/2025] and
A
TTEST:

BY: ____N/A_______________________
its: _______________________________
BY
: _______________________________

CARMEN AVALOS
City Clerk
APP
ROVED AS TO FORM:

BY:
_______________________________

MICHELLE SHEIDENBERGER
City Attorney
APP
ROVED AS TO SUBSTANCE:

BY
: _______________________________

DENNIS KAUFFMAN
Chief Financial Officer/
Assistant City Manager

[B:\City Attorney\corres\Kelly\Contracts 2025\MGT Third Amendment.docx:10/13/2025]

EXHIBIT “A”

(916) 760-4121x1003 | 4320 W. Kennedy Blvd., Tampa, FL 33609 mgt.us

October 9, 2025
Nancy Rothlisberger, Assistant Finance Director
City of Roseville, CA
311 Vernon Street
Roseville, CA 95678
RE: CITY OF ROSEVILLE COST PLAN PROJECT-RFP#10-22 CONTRACT

RENEWAL
Dear Nancy:

This letter is regarding the City’s request to amend and renew cost plan services with MGT per the original signed contract in response to RFP#10-22. MGT Consulting Group (MGT) is pleased to submit our renewal scope of services to the City of Roseville to continue to provide cost allocation services.

MGT began operations in 1974 and has judiciously expanded its consulting capabilities over the years.

MGT is owned by the current and retired partners, principals, and consultants of the firm. The advantage of this ownership structure to our clients is that every member of the firm has a vested interest in the successful completion of every project, for every client. MGT has acquired a keen understanding of the structures, operations, and issues facing public agencies. This understanding comes from over 50 years of experience providing financial and management consulting services to state and local governments, and the prior work experience of our consultants. We are not the biggest, oldest, or highest profile consulting firm; just the best for combining firm qualifications and consultants’ indirect cost and cost allocation expertise with the needs of cities, counties, and state agencies.

MGT has forty full-time consultants who prepare cost allocation plans and indirect cost rates all year, every year. This focus and commitment allow us to provide better service and the best advice in these areas. The majority of our division’s consultants have been directly employed in producing cost allocation plans for more than 15 years, with an average of 15 years of direct government consulting experience.

Ms. Parul Patel, Director, will continue to serve as Project Manager and oversee the day-to-day project management activities. This includes data gathering, identifying allowable costs, meetings with City staff, preparing the indirect cost model, and delivery of reports. In addition, Ms. Nicoshia Roadruck will serve as a project consultant and will work with Ms. Patel.

SCOPE OF SERVICES
The City of Roseville is requesting the preparation of a Citywide FY 26 Full and FY 25 2 CFR Part 200 Cost Allocation plan and Indirect Cost Rates for up to thirty departments.

The following work plan has been refined over many years to provide a methodology that produces MGT’s CAPs and rates with minimal disruption to our clients’ workloads. The tasks associated with the overall process are presented below.

mgt.us
PROJECT TASKS Month Ongoing 1 2 3 4
PHASE 1: PLANNING & DATA PHASE

1.0 Initial Meeting

2.0 Introductory Training

3.0 Review Organizational Structure and
Existing Plans and Rates

4.0 Collect Basic Operational & Financial Data

5.0 Conduct Department Interviews

6.0 Evaluate Existing Methodologies and
Develop Recommendations
PHASE 2: STRUCTURE & PREPARE PLAN

7.0 Develop Cost Plan Structure & Distribute
Central Service Department Costs Into
Functions

8.0 Develop Allocation Bases for Central
Service Department Functions

9.0 Process Draft Cost Plans

10.0 Quality Control & Internal Review

11.0 Provide Draft Cost Plans

12.0 Provide Draft Departmental ICRPs (up to 30)
PHASE 3: PRESENT CAP RESULTS & FINALIZE PROJECT

13.0 Process Final Cost Plans/Rates & Provide
Final Docs

14.0 Present Project Results to Project
Stakeholders and City staff & Identify
Additional Uses

15.0 Prepare a CAP Project Recap Report & Post
Project Training Session

mgt.us

COST PROPOSAL
Project Deliverables
Renewal Plan
Year
FY 2025-26
Option Year
1 FY 2026-27
Option Year
2 FY 2027-28
Citywide Full and 2 CFR Part 200 Cost
Allocation Plans and Departmental Indirect
Cost Rates (up to 30)
$33,720 $35,406 $37,175
Total Fees $33,720 $35,406 $37,175
If you have questions, please contact Ms. Parul Patel at 714.272.3461 or [email protected].

Sincerely,
Patrick J. Dyer, Vice President
Authorized to Bind the Firm

City Council
Communication
Meeting Date: 11/5/2025
Item #: VIII.19
File #: 0206-03-01
Item ID: 2025-757

Title: Creekview Phase 5 Community Facilities District No. 1 - Bond Issuance Contact: Jeannine Thrash 916-774-5473 [email protected]

SUMMARY
Staff recommends Council authorization for the issuance of special tax bonds for and on behalf of the Creekview Phase 5 Community Facilities District (CFD) No. 1 (Public Facilities), and approving the Fiscal Agent Agreement, Bond Purchase Agreement, Acquisition Agreement, and Preliminary Official Statement.

The Series 2025 Bonds are being issued at the developer’s request in an amount not to exceed $18,000,000. Special taxes levied within the Creekview Phase 5 Community Facilities District (CFD) No. 1 will be paid by property owners and will be sufficient to cover debt service, CFD administration, and any authorized pay-as-you-go facilities, as well as to provide future funding for maintenance and replacement of constructed facilities. Issuance of these bonds will have no impact on the City’s General Fund.

RECOMMENDATION
Staff recommends that the City Council adopt a resolution authorizing the issuance of special tax bonds for and on behalf of the Creekview Phase 5 Community Facilities District (CFD) No. 1 (Public Facilities), and approving the following documents:
• Fiscal Agent Agreement
• Bond Purchase Agreement
• Acquisition Agreement
• Preliminary Official Statement

BACKGROUND
Creekview Phase 5 Community Facilities District (CFD) No. 1 was formed on August 20, 2025. The project area encompasses approximately 53 acres and includes plans for 285 taxable residential units, representing Phase 5 of the Winding Creek development within the Creekview Specific Plan. The Series 2025 Bonds are the first series to be issued at the developer’s request, in an amount not to exceed $18,000,000. The District’s maximum authorized principal amount is not to exceed $92,000,000.

FISCAL IMPACT
Special taxes levied within the CFD will be paid by property owners and will be sufficient to cover debt service, CFD administration, and any authorized pay-as-you-go facilities. In addition, the special taxes will provide future funding for the maintenance and replacement of constructed facilities. Issuance of these bonds will have no impact on the City’s General Fund.

ENVIRONMENTAL REVIEW
The California Environmental Quality Act (CEQA) does not apply to activities that will not result in a direct or reasonably foreseeable indirect physical change in the environment, or is otherwise not considered a

project as defined by CEQA Statute §21065 and CEQA State Guidelines §15060(c)(3) and §15378. The adoption of the resolution and approval of the documents herein meets the above criteria and is not subject to CEQA. No additional environmental review is required.

COMPLIANCE STATEMENT
In accordance with Government Code 5852.1, the following information consists of estimates of certain costs and charges for the Bonds that have been provided by the City's municipal financial advisor, which has been represented by such party to have been provided in good faith: (1) estimated true interest costs of the Bonds: 5.39%; (2) estimated finance charge of the Bonds (sum of all fees and charges paid to third parties): $661,999; (3) estimated amount of proceeds of the Bonds received by the City (net of finance charges and reserves): $13,000,000: and (4) estimated total payment amount (sum total of all payments to pay debt service on the Bonds plus the finance charge not paid with proceeds of the Bonds) calculated to the final maturity of the Bonds: $33,825,445.

CITY COUNCIL STRATEGIC PLAN/OVERARCHING GOALS

2. Remain fiscally responsible in a changing world

4. Invest in well-planned infrastructure and growth

Respectfully Submitted,
Jeannine Thrash, Management Analyst

Scott Pettingell, Finance Director

ATTACHMENTS:

1. Resolution 25-347

2. Fiscal Agent Agreement

3. Bond Purchase Agreement

4. Acquisition Agreement

5. Preliminary Official Statement

REVIEWERS:

Jeannine Thrash, Finance Department Created/Initiated - 10/15/2025 Scott Pettingell, Finance Department - Budget Approved - 10/16/2025 Gretchen Hakala, City Clerk Department Approved - 10/17/2025 Kelly Aye, City Attorney Department Approved - 10/21/2025 Katrina Six, City Clerk Department Approved - 10/23/2025 Ryan DeVore, City Clerk Department Approved - 10/23/2025 Dennis Kauffman, City Manager Department - Assistant City Manager Approved - 10/23/2025 Michelle Sheidenberger, City Attorney Department Approved - 10/24/2025 Dominick Casey, City Clerk Department Approved - 10/27/2025 Katrina Six, City Clerk Department Final Approval - 10/27/2025

RESOLUTION NO. 25-347

A RESOLUTION AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS FOR AND ON BEHALF OF THE CITY OF ROSEVILLE CREEKVIEW PHASE 5 COMMUNITY FACILITIES DISTRICT NO. 1 (PUBLIC FACILITIES),

APPROVING AND DIRECTING THE EXECUTION OF A FISCAL AGENT

AGREEMENT, BOND PURCHASE AGREEMENT AND ACQUISITION

AGREEMENT, APPROVING THE FORM OF PRELIMINARY OFFICIAL

STATEMENT, APPROVING SALE OF SUCH BONDS, AND APPROVING

OTHER RELATED DOCUMENTS AND ACTIONS

WHEREAS, this City Council (the “Council”) of the City of Roseville (the “City”) has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5, commencing at Section 53311, of the California Government Code (the “Act”), to form the Creekview Phase 5 Community Facilities District No. 1 (Public Facilities) (the “District”), to authorize the levy of special taxes upon the land within the District, and to issue bonds secured by said special taxes for the purpose of providing moneys for the construction and acquisition of authorized improvements for the District; and

WHEREAS, the Council, as legislative body of the District, authorized the issuance of special tax bonds of the City for the District in the maximum principal amount of not to exceed $92,000,000, and the City now desires to issue the first series of the bonds (the “Bonds”) for the District; and

WHEREAS, there has been submitted to the City Council a Fiscal Agent Agreement (the “Fiscal Agent Agreement”) between the City and U.S. Bank Trust Company, National Association, as fiscal agent, providing for the issuance of the Bonds for the District, and the Council, with the aid of City staff, has reviewed the Fiscal Agent Agreement and found it to be in proper order, and now desires to approve the Fiscal Agent Agreement and the issuance of the Bonds; and

WHEREAS, the City proposes to sell the Bonds to Piper Sandler & Co, as underwriter (the “Underwriter”), pursuant to the terms of a Bond Purchase Agreement by and between the City and the Underwriter, and the Underwriter proposes to offer the Bonds to the investing public by means of a Preliminary Official Statement, and the Council, with the aid of City staff, has reviewed the Bond Purchase Agreement and the Preliminary Official Statement and found them to be in proper order, and now desires to approve said documents; and

WHEREAS, authorized improvements for the District funded from proceeds of the Bonds will be acquired by the City from a developer of land in the District pursuant to the terms of a Funding, Construction and Acquisition Agreement (the “Acquisition Agreement”) by and between the the City and the developer, and the Council, with the aid of City staff, has reviewed the Acquisition Agreement and found it to be in proper order, and now desires to approve the form of the Acquisition Agreement; and

WHEREAS, the information required to be obtained and disclosed with respect to the Bonds by the City Council in accordance with Section 5852.1 of the California Government Code is set forth in the staff report accompanying this Resolution; and

- 2 -
WHEREAS, all conditions, things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of the Bonds as contemplated by this Resolution and the documents referred to herein exist, have happened and have been performed in due time, form and manner as required by the laws of the State of California, including the Act.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ROSEVILLE RESOLVES AS FOLLOWS:

1. Findings. This Council finds and determines that it is prudent in the management and development of land in the City and the District to issue the Bonds for the purpose of providing moneys for the construction and acquisition of authorized improvements for the District.

2. Law Applicable. For the purposes of these proceedings in and for the District, the Act shall be the authority for the issuance of the Bonds.

3. Bonds Authorized. Pursuant to the Act, this Resolution and the Fiscal Agent Agreement, special tax bonds of the City for the District designated as “City of Roseville Creekview Phase 5 Community Facilities District No. 1 (Public Facilities) Special Tax Bonds Series 2025” in an aggregate principal amount not to exceed $18,000,000 are hereby authorized to be issued. The Bonds shall be executed in the form set forth in and otherwise as provided in the Fiscal Agent Agreement.

The Bonds shall not be issued unless the value of the real property within the District subject to the special tax to pay debt service on the Bonds, based on assessed values and/or an appraisal by an independent appraiser hired by the City for the purpose of determining such value, is at least three (3) times the proposed principal amount of the Bonds proposed to be issued and secured by a special tax levied pursuant to the Act on property within the District, plus the portion of all other bonds outstanding that are secured by a special tax levied under the Act on property within the District or a special assessment levied on property within the District.

4. Fiscal Agent Agreement. The Council hereby approves the Fiscal Agent Agreement in the form presented to the Council at this meeting. The City Manager, Assistant City Manager, Chief Financial Officer and such other person or persons as either of them may designate (collectively, the “Authorized Officers”), each acting alone or together with any other Authorized Officer, are each hereby authorized and directed to execute the Fiscal Agent Agreement, for and in the name and on behalf of the City, in such form, together with any additions thereto or changes therein deemed necessary or advisable by the Authorized Officer executing such document upon consultation with Jones Hall, A Professional Law Corporation, as bond counsel to the City (“Bond Counsel”). The proceeds of the Bonds shall be applied by the City for the purposes and in the amounts as set forth in the Fiscal Agent Agreement. The Council hereby authorizes the delivery and performance by the City of the Fiscal Agent Agreement.

5. Covenant to Foreclose. The City hereby covenants, for the benefit of the owners of the Bonds, to commence and diligently pursue to completion any foreclosure action regarding delinquent installments of any amount levied as a special tax for the payment of interest or principal of the Bonds, said foreclosure action to be commenced and pursued as more completely set forth in the Fiscal Agent Agreement.

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6. Approval of Official Statement and Continuing Disclosure Certificate. The Council hereby approves the Preliminary Official Statement with respect to the Bonds, in substantially the form on file with the City Clerk. Distribution of the Preliminary Official Statement by the City and the Underwriter is hereby approved, and, prior to the distribution of the Preliminary Official Statement, and each Authorized Officer, each acting alone or together with any other Authorized Officer, is authorized and directed, on behalf of the City, to deem the Preliminary Official Statement “final” pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 (the “Rule”). The execution of the final Official Statement, which shall include such changes and additions thereto deemed advisable by the Authorized Officer executing the same, and such information permitted to be excluded from the Preliminary Official Statement pursuant to the Rule, is hereby approved for delivery to the purchasers of the Bonds, and each Authorized Officer, each acting alone or together with any other Authorized Officer, is authorized and directed to execute and deliver the final Official Statement for and on behalf of the City, with final pricing information included and with such changes and additions thereto deemed advisable by the Authorized Officer executing the same.

The Council hereby approves the Continuing Disclosure Certificate to be executed by the City, the form of which is attached as an exhibit to the Preliminary Official Statement. Each of the Authorized Officers is hereby authorized and directed to approve any changes in or additions to a final form of said Continuing Disclosure Certificate, and the execution thereof by an Authorized Officer shall be conclusive evidence of approval of any such changes and additions. The final Continuing Disclosure Certificate shall be executed in the name and on behalf of the City by an Authorized Officer.

7. Approval of Bond Purchase Agreement. The Council hereby approves the Bond Purchase Agreement in substantially the form on file with the City Clerk; provided, that the aggregate principal amount of Bonds shall not exceed $18,000,000 or result in an Underwriter’s discount in excess of 1.50% of the par amount of the Bonds, or a true interest cost in excess of

6.50%. Subject to the foregoing parameters, an Authorized Officer is hereby authorized and directed to execute the Bond Purchase Agreement in substantially the form on file with the City Clerk, together with such changes and additions thereto deemed advisable by the Authorized Officer executing the same. The Council hereby finds and determines that the sale of the Bonds at negotiated sale as contemplated by the Bond Purchase Agreement will result in a lower overall cost.

8. Approval of Acquisition Agreement. The Council hereby approves the Acquisition Agreement in substantially the form on file with the City Clerk. An Authorized Officer is hereby authorized and directed to execute the Acquisition Agreement in substantially the form on file with the City Clerk, together with such changes and additions thereto deemed advisable by the Authorized Officer executing the same.

9. Actions Authorized. All actions heretofore taken by the officers, employees and agents of the City with respect to the establishment of the District, and the sale and issuance of the Bonds, are hereby approved, confirmed and ratified, and the Authorized Officers of the City are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds in accordance with this resolution, and any certificate, agreement, and other document described in the documents herein approved. All actions to be taken by a specified Authorized Officer as specified herein, may be taken by the Authorized Officer or any designee, with the same force and effect as if taken by such Authorized Officer.