Watsonville City Council
January 16, 2024

800-C South Rochester Avenue, Ontario, CA 91761 (V) 909-390-1328

Geomembrane Submittals:
o Product Data – Geomembrane
Manufacturer’s Quality Control Testing.
o Geosynthetic Samples
o Seam Samples - LLDPE Extrusion Weld
o Seam Samples - LLDPE Fusion Weld
o Manufacturer's 5 Year Warranty Sample
o Manufacturer's 5 Year Warranty
o Manufacturer's Certification Attachment
2G-1
o Independent Testing Laboratory GAI
Certification
o Manufacturer's Certification of Extrudate
Rod or Bead
o Geosynthetics Delivery Notification
o Subgrade Certification
o Proposed Panel Layout(s)
o Contractor's Geomembrane Installation
Procedures
o Contractor's Installer Resume
o Quality Control Technician Resume
o Manufacturing Conformance Testing 60-
mil LLDPE Super Grip Net
o Record Drawings (As built)
o Geosynthetic Installer’s Daily
Documentation
o Subgrade Maintenance Plan
o Manufacturer's Quality Assurance Plan
o Manufacturer's Installation Quality
Assurance Plan
o As built panel layout – Geomembrane
o Contractor Final Quality Control Records
o Contractor’s Installation Quality Control
Plan
Miscellaneous Civil Submittals:
o Concrete Mix Designs
o Rip Rap Certification of Compliance
o Corrugated HDPE Pipe and Fittings
o Flexible Post Delineators
o Hydroseed Certification
o Reinforcing Steel and Wire Mesh
Certificate of Compliance
o Geotextile Manufacturer's Product Data
o Asphalt Concrete Design Mix
o Crushed Miscellaneous Base
Certificate of Compliance
• Respond to engineering items associated with Contractor or CM Requests for Information (RFIs).
• Review and comment on product manufacturer information. • Attend final job-walks and assist the CM with the preparation of a punch list. • Review CQA firm’s preparation of a final construction report. • Technical review of the Contractor’s record drawings developed during construction.

TASK 3.0 CQA SERVICES – SEE ATTACHED FROM HAI
TASK 4.0 CONSTRUCTION MANAGEMENT
Task 4.1 Pre-Construction Phase
The Construction Manager (CM) will have developed the format for all project files and pertinent project documents. At a minimum, project files will include:
• All contract documents, i.e., Contract/Agreement, Bid schedule, General Conditions, Special Conditions, Technical Specifications, and CQA Requirements. • Required safety documentation and equipment.

Exhibit "A"
pg. 7 of 21

PROPOSAL FOR ENGINEERING SERVICES, ENGINEERING SUPPORT DURING CONSTRUCTION,

CONSTRUCTION QUALITY ASSURANCE, AND CONSTRUCTION MANAGEMENT

FOR THE PHASE IV GROUNDWATER PROTECTION SYSTEM AND PHASE III FINAL CLOSURE December 20, 2023

Z:\Proposals\Watsonville\PN 23-2091 Ph IV GW Protection Liner_Ph III Final Closure\PN 23- 2091 Ph IV GW Protection Liner _Ph III Final Closure_122023.docx
• Appropriate reference specifications, standards, and standard plans. • Project personnel and emergency phone numbers.
• Submittal log.
• Daily construction report format.
• Contract change order documentation and approval procedures. • Progress payment format in compliance with City’s standard. • Correspondence log.
• Project photographic log.
• Record drawing format.

A pre-construction conference will be scheduled. The CM will prepare an agenda and review it with the City’s Project Manager. At a minimum, the agenda will include the following:
• Introduction of project participants (City, General Contractor, Regulatory Agencies, Liner Sub-Contractor, and SWT Project Engineer).
• Lines of communication.
• Project health and safety issues.
• Emergency notification procedures.
• Project schedule.
• CQA, (review of project requirements).
• Requests for Information (RFls).
• Change order/extra work (procedures and approvals).
• Review of site-specific concerns (plans and specifications). • Survey requirements.

Task 4.2 Field Services
The CQA monitoring staff (CQA services to be provided by Hushmand Associates) will be coordinated by the CM with additional technical support from the engineering and design staff.

The CM will evaluate the needs of specific projects based on the level of activities represented on the contractor’s schedule and as dictated by field conditions.

The CM will provide detailed reports of contractor activities. Of particular note will be any deviations from the project specifications or CQA plan. All variances will be documented and will be maintained on a "cumulative punch" list until repair and/or remediation has been completed. While all aspects of a project are important, particular attention will be paid to such items as the processing and placement of geosynthetic liner installations.

SWT understands the importance of detailed documentation on all aspects of a construction project. Construction documentation provides not only a project history but is quite often the basis for resolving many outstanding issues. Clarification or adjustment of payment limits, extra work and changed or unforeseen conditions, and ultimately, an evaluation of the Exhibit "A"
pg. 8 of 21

PROPOSAL FOR ENGINEERING SERVICES, ENGINEERING SUPPORT DURING CONSTRUCTION,

CONSTRUCTION QUALITY ASSURANCE, AND CONSTRUCTION MANAGEMENT

FOR THE PHASE IV GROUNDWATER PROTECTION SYSTEM AND PHASE III FINAL CLOSURE December 20, 2023

Z:\Proposals\Watsonville\PN 23-2091 Ph IV GW Protection Liner_Ph III Final Closure\PN 23- 2091 Ph IV GW Protection Liner _Ph III Final Closure_122023.docx
completeness of the project, will all be dependent upon accurate construction documentation.

In addition, the construction documentation will be used to gain approval to utilize the lined area for refuse disposal operations.

Below is a brief description of typical documentation that will be maintained during a project:

Submittals
The CM will determine the minimum submittal requirements for material and equipment as outlined in the Project Specifications. Most submittals will require the approval of design staff.

Request for Information (RFI) and Design Clarification Log The same format as outlined for tracking submittals will be implemented to track RFls and Design Clarifications. All responses to RFls and finalization of Design Clarifications will be reviewed and approved by the Design Engineer and, if applicable, the CQA Officer.

Progress Meeting Minutes
In addition to the above noted documentation, progress meetings will be conducted in which many of the issues below will be reviewed and documented (weekly or bi-weekly):
• Contract time summary to date.
• Progress and schedule review.
• Submittal review.
• Amendments or corrections to the previous week's minutes. • Health and Safety issues.
• Request for Information review.
• CQA review and discussion of issues.
• Progress payment (if applicable).
• Review any out-of-scope or extra work occurring after the previous meeting. Review any changed or unforeseen conditions that have come to the Contractor’s attention since the previous meeting. (If required, separate resolution meetings will be scheduled to discuss and resolve specific issues).

Work Force and Material Daily Reports
When "time and material" work has been authorized, or disputed work is taking place, the CM will keep a detailed summary of the manpower, equipment, and material being used in the operation.

Cumulative Corrective Action File
A list will be maintained of deficiencies and items requiring repair, removal, or remediation.

As items are corrected, they will be removed from the list. The contractor will be kept advised of the items requiring additional work. At the conclusion of the project, those items which have not been completed will be added to the final punch list.

Contract Time
On a daily basis, the CM will make a determination as to whether or not the day is to be charged Exhibit "A"
pg. 9 of 21

PROPOSAL FOR ENGINEERING SERVICES, ENGINEERING SUPPORT DURING CONSTRUCTION,

CONSTRUCTION QUALITY ASSURANCE, AND CONSTRUCTION MANAGEMENT

FOR THE PHASE IV GROUNDWATER PROTECTION SYSTEM AND PHASE III FINAL CLOSURE December 20, 2023

Z:\Proposals\Watsonville\PN 23-2091 Ph IV GW Protection Liner_Ph III Final Closure\PN 23- 2091 Ph IV GW Protection Liner _Ph III Final Closure_122023.docx
as a "contract day". A Contract Time Summary will be prepared indicating recommended time extensions for inclement weather, change orders, or unforeseen conditions. The summary will reflect the adjusted contract completion date, and the remaining contract time.

Contract Change Orders
All change orders or contract modifications must be approved prior to beginning the work.

Contract change orders will be based on either an extension of contract unit prices, an approved contractor estimate, or on a time and materials basis. Change orders will be finalized on a separate Change Order document, approved by City.

Verify Certified Payroll
SWT will verify certified payroll and prevailing wage, as requested by the City to obtain documents. At a minimum, SWT will collect certified payroll from the contractor on a monthly basis and include in the final closeout documents for the project.

Progress Payments
Monthly progress payment applications will be prepared based on a schedule agreed upon by City and the Contractor. Applications may be prepared in Excel or a format of the City’s preference. The CM will schedule a meeting with the Contractor to review the Contractor's estimated quantities, prior to preparing the payment application. Standard progress payment packages will include, Contractor’s Invoice, Application for Payment (contract summary and signature page), and Contractor's Detailed Monthly Application for Payment (summary of individual bid items status).

Project close-out procedures will commence before the conclusion of the contract. SWT Engineering will maintain a cumulative listing of project deficiencies and corrective action items. Pre-final inspections will be implemented to develop project punch lists.

Task 4.3 Final Construction Close Out Report
SWT will prepare draft and final Construction Certification Reports in accordance with the CQA Plan. The final report will include the field notes, field records, completed field correspondences, project photographs, all approved modifications to the plans and specifications, and a narrative description of the project: liner system construction observation and field test results. CQA report will be referenced in the Close Out Report and any approved changes. Where CQA data differs from the specifications, the CQA Report will explain the deviations and any affect the deviation is expected to have on the performance of the liner system (if any). All plans, specifications, manuals, and technical reports reviewed or utilized during the project will be appropriately referenced in the report.

Project close-out procedures will begin well before the end of construction. All submittals should have been received by this time and the CM will also verify receipt of any Manufacturers warrantees, record drawings, or other required literature or documentation.

At the completion of the project close-out procedure, SWT will submit to the City all project photographic logs, final as-built plans, and CQA Report (prepared by HAI) as part of the Close Out Report.

The Final Construction Close Out Report will include a statement certifying that the groundwater protection system was constructed in general accordance with the Project Plan and Special Provisions, and any design changes made to those documents.

Exhibit "A"
pg. 10 of 21

PROPOSAL FOR ENGINEERING SERVICES, ENGINEERING SUPPORT DURING CONSTRUCTION,

CONSTRUCTION QUALITY ASSURANCE, AND CONSTRUCTION MANAGEMENT

FOR THE PHASE IV GROUNDWATER PROTECTION SYSTEM AND PHASE III FINAL CLOSURE December 20, 2023

Z:\Proposals\Watsonville\PN 23-2091 Ph IV GW Protection Liner_Ph III Final Closure\PN 23- 2091 Ph IV GW Protection Liner _Ph III Final Closure_122023.docx
TASK 5.0 PROJECT MANAGEMENT/MEETINGS
SWT will provide project administration services including project schedule development, tracking and updating, budget tracking, invoicing, and activity reporting, as requested. The SWT Project Manager will also coordinate activities with the City and the regulatory agencies, if requested. The SWT Project Manager will provide general administration of the contract, track budget performance and task scheduling, conduct regular progress meetings, document scope changes, provide City with required monthly invoice activity reports, and generally coordinate all efforts related to the project within the bounds of the scope as directed by the City.

TASK 6.0 COMBINED PROJECT SUPPLEMENTAL BUDGET
A supplemental budget should be considered for the combined project to cover unknown and unforeseen circumstances for CM and CQA services to be provided. For example, weather and/or schedule delays are common with heavy civil construction and a contingency budget could account for rain/weather days as a portion of the proposed work is anticipated to be performed during winter months.

SCHEDULE
The project schedule is based on the Contractor's schedule; budget is based on 135 working days of construction.

FEE ESTIMATE
The following is the fee estimate for each task described above is presented as follows:

Project Re-Bid Services
Task 1.0 Engineering Services for Project Re-Bid ................................................... $29,072 Engineering Support, CM, and CQA Services
Task 2.0 Phase IV Liner and Phase III Final Closure Engineering Support Services ....................................................................................... $86,990 Task 3.0 CQA Services ........................................................................................... $261,959 Task 4.0 Construction Management ..................................................................... $257,558 Task 5.0 Project Management/Meetings ................................................................ $17,686 Task 6.0 Combined Project Supplemental Budget ................................................ $55,656 ____________________________________________________________________________ Total Fee Estimate ................................... $708,922 SWT will keep City informed of the status of the budget balance by issuing monthly progress summary reports with each invoice. SWT will invoice City for the portion of work that has been completed. This Fee Estimate is for budget purposes only. All work performed will be invoiced on a Time-and-Materials basis, based on actual staff providing the service, using the current rate schedule at the time services are provided, see attached 2024 Rate Schedule. SWT understands this is a large commitment for the City, however this is a complete package of field services, and it is less than 5% of the anticipated construction costs. Not only is most of Exhibit "A"
pg. 11 of 21
Exhibit "A"
pg. 11 of 21

PROPOSAL FOR ENGINEERING SERVICES, ENGINEERING SUPPORT DURING CONSTRUCTION,

CONSTRUCTION QUALITY ASSURANCE, AND CONSTRUCTION MANAGEMENT

FOR THE PHASE IV GROUNDWATER PROTECTION SYSTEM AND PHASE III FINAL CLOSURE December 20, 2023

Z:\Proposals\Watsonville\PN 23-2091 Ph IV GW Protection Liner_Ph III Final Closure\PN 23- 2091 Ph IV GW Protection Liner _Ph III Final Closure_122023.docx
this required to gain regulatory approval of the project (CM/CQA) these services will help provide protection for the City and increase the potential successfulness of the project.

CLOSURE
SWT appreciates the chance to propose on this project for the City. We look forward to continuing our working relationship with the City of Watsonville. Should you have any questions or require additional information regarding this proposal, please contact Michael A.

Cullinane at (909) 390-1328 or via email at [email protected], or the Project manager, Brian Reyes via email at [email protected].

Sincerely,
Michael A. Cullinane, P.E.

Principal
Attachments:

Fee Schedule 2024
Summary of Full Proposal Fee Estimate
Proposal for CQA Services (HAI) – Fee Estimate Integrated into this Proposal Exhibit "A"
pg. 12 of 21
Exhibit "A"
pg. 12 of 21
Exhibit "A"
pg. 12 of 21

PROPOSAL FOR ENGINEERING SERVICES, ENGINEERING SUPPORT DURING CONSTRUCTION,

CONSTRUCTION QUALITY ASSURANCE, AND CONSTRUCTION MANAGEMENT

FOR THE PHASE IV GROUNDWATER PROTECTION SYSTEM AND PHASE III FINAL CLOSURE December 20, 2023

Z:\Proposals\Watsonville\PN 23-2091 Ph IV GW Protection Liner_Ph III Final Closure\PN 23- 2091 Ph IV GW Protection Liner _Ph III Final Closure_122023.docx

FEE SCHEDULE 2024

Staff Classification Hourly Rate
Clerk ........................................................................................................................................ $72 Technician ............................................................................................................................... $88 CADD Operator ..................................................................................................................... $112 Planner I................................................................................................................................ $112 Administrative Assistant ...................................................................................................... $114 Engineering Technician ........................................................................................................ $114 Planner II............................................................................................................................... $132 Engineer I .............................................................................................................................. $138 Project Coordinator .............................................................................................................. $146 Planner III.............................................................................................................................. $160 Engineer II/Designer ............................................................................................................ $166 Engineer III/ Scientist .......................................................................................................... $186 Construction Manager (CM) ................................................................................................ $188 Senior Planner ...................................................................................................................... $188 Project Engineer/Senior Scientist ....................................................................................... $202 Project Manager ................................................................................................................... $232 Principal Planner ................................................................................................................... $274 Principal Engineer/Sr. CM .................................................................................................... $274 Principal ................................................................................................................................ $286 Overtime premium, if appropriate, will be invoiced at 1.5 times of the above rates.

Reimbursable charges (reproduction, courier charges, miscellaneous in-house expenses.) are invoiced at 5 percent of total labor charges, not requiring a breakdown.

Other reimbursable charges are invoiced as follows:

Mileage ...................................................................................................................................... Federal Rate Vehicle .............................................................................................................................................. $8/Hour Sub consultants/Outside Services .................................................................................. Cost +15 percent Outside Out-of-Pocket Expenses ...................................................................................... Cost +15 percent Per Diem for Living Expenses ................................................................................................... Federal Rate Drone Topographic Processing by Third Party (Propeller) ......................................... $1,000/Credit Used Any non-recurring project-specific charges not listed above will be invoiced at Cost + 15 percent, or as negotiated in the contract.

Fee Schedule effective through December 31, 2024
Exhibit "A"
pg. 13 of 21

Principal
Project Engineer
Construction
Manager
Engineer II
Project Coordinator

TOTAL LABOR
5% Expenses
(Note 5)
Vehicle
Nbr. Hours (Note 7)
Per Diem
(Note 2,3,4)

FEE ESTIMATE
Hourly Rate\$ $286.00 $202.00 $188.00 $166.00 $146.00 $8.00

1.0 ENGINEERING SERVICES FOR PROJECT RE-BID 8 60 80 $27,688 $1,384 $29,0722.0 PHASE IV MODULE 1 LINER AND PHASE III FINAL CLOSURE ENGINEERING SUPPORT 80 264 40 $82,848 $4,142 $86,9903.0 CQA SERVICES $261,9594.0 CONSTRUCTION MANAGEMENT4.1 Pre-Construction Phase 16 $3,008 $150 $3,1584.2 Field Services (Note 9) 1080 $203,040 $10,152 $8,640 $28,620 $250,452

4.3 Final Construction Close Out Report 20 $3,760 $188 $3,9485.0 PROJECT MANAGEMENT/MEETINGS 30 12 40 $16,844 $842 $17,6866.0 COMBINED PROJECT SUPPLEMENTAL BUDGET 240 $45,120 $2,256 1920 6360 $55,656 TOTAL HOURS 110 276 0 40 40
ESTIMATED FEE $31,460 $55,752 $0 $6,640 $5,840 $99,692 $4,985 $0 $0 $708,922 $708,922
Notes:
1) Contract Time is approximately 135 Working Days (27 weeks).3) Santa Cruz County Per Diem for M&I FY 2024 is $69/day4) Total Per Diem will be estimated at $197/day for 135 working days. 5) Reimbursable charges (reproduction, courier charges, travel and lodging for Engineering Staff, miscellaneous in-house expenses) will be billed at 5% of labor not requiring a specific breakdown.6) Other reimbursable expenses will be invoiced per our current rate schedule in effect.7) Vehicle rate assessed at $8/hour of Construction Manager Work Hours.8) Estimate is for budget purposes only and work will be invoiced based on the actual staff performing the work using the current rate schedule at the time of service.9) Field Services hours for Construction Manager are for 8 hour working days for 135 days.2) Santa Cruz County Per Diem for Lodging FY 2024 is $181/day (June-August) and $143/day (September-May); SWT is preparing our fee estimate at the lower rate (off-season @ $143/day) for the entirety of the project.

Summarized in Tasks 4.1-4.3 Below

ENGINEERING SUPPORT & CM/CQA - PHASE IV GROUNDWATER PROTECTION SYSTEM (LINER) AND PHASE III FINAL CLOSURE

AT THE CITY OF WATSONVILLE LANDFILL
FEE ESTIMATE - PN 23-2091
CQA Services Provided by Hushmand and Associates (HAI)
See Attached Fee Estimate Table for Description of Fee Estimate TOTAL FEE ESTIMATE:

Z:\Proposals\Watsonville\PN 23-2091 Ph IV GW Protection Liner_Ph III Final Closure\FEE EST_WCSL_Phase IV GW Protection Liner_III Final Closure_122023 SWT Engineering

Hushmand Associates, Inc.
250 Goddard
Irvine, CA 92618
p. (949) 777‐1266
w. haieng.com
e. [email protected]
December 18, 2023
SWT Civil & Environmental Engineering
800-C South Rochester Avenue
Ontario, California 91761
Attn: Michael Cullinane, P.E., Principal
Subject: Proposal for Construction Quality Assurance (CQA) Services City of Watsonville Landfill Phase III Final Closure and Phase IV Cell Extension Construction, City of Watsonville, Santa Cruz County, CA HAI Proposal No. P23-1218
Dear Mr. Cullinane:

Hushmand Associates, Inc. (HAI) is pleased to
submit this proposal to SWT Civil &
Environmental Engineering (SWT) to provide
Construction Quality Assurance (CQA) services
during the Watsonville Landfill Phase III Final
Closure and Phase IV Cell Extension
Construction. This proposal is prepared in
response to a Request for Proposal (RFP) submitted by SWT via an email on December 4, 2023.

The following documents were reviewed for preparing this proposal:
 Construction Quality Assurance Plan, Liner and Final Cover Construction, City of Watsonville Landfill, Watsonville, California (June 2010);  Combined Project Schedule, Request for Proposals Consulting Services for Phase III Final Closure & Phase IV Development Design, Permitting, Construction Support, and CQA Services at the City of Watsonville Landfill
 Table 1 - City of Watsonville Landfill - Phase III Closure, Final Closure Cost Estimate 2021

1.0 PROJECT DESCRIPTION AND BACKGROUND
The Landfill was designed and permitted and is operated in compliance with Class III landfill standards set forth in 27 CCR. The City began installing composite liners with the development of Phase III in 1996. A composite liner and LCRS were constructed in Phase III. As-built plans have previously been submitted to the RWQCB as a part of construction reports documenting construction activities. The as-built plans are also on file at the City office.

Our mission is to provide you with
the information needed to
successfully accomplish the City of
Watsonville’s goals for this project
Exhibit "A"
pg. 15 of 21

Proposal for Construction Quality Assurance Services
Watsonville Landfill Phase III Closure & Phase IV Cell Construction SWT Civil & Environmental Engineering
HAI Proposal No. P23-1218 Page 2
Phases I and II have been closed. Phase III final cover construction is planned to start in 2022. A Partial Final Closure and Post-closure Maintenance Plan for Phase III was prepared as part of the Joint Technical Document (JTD) prepared by ES Engineering Services LLC (ES) in June 2018. The Partial Final Closure Plan provides general design and construction guidance for the closure of Phase III and landfill operations during the service life of the landfill and through site closure.

Phase III final cover system from top-down consists of the following elements:
 24-inch vegetative/protective soil cover layer (~ 40,000 cubic yards)  Geotextile separator layer,
 60-mil LLDPE Super Gripnet® geomembrane layer,
 Foundation soil layer for Bench Gradient/Width (~ 5,000 cubic yards), and  6- to 8-inch re-compacted interim cover over refuse.

The assumed final cover system layers are based on design information presented on Design Detail Sheet No. D1 contained in the “Watsonville Landfill Phase III Closure Construction Project Drawing Set,” prepared by SWT Engineering, Inc., dated February 2018.

2.0 COMPANY BACKGROUND AND EXPERIENCE
Hushmand Associates, Inc. (HAI) is a geotechnical and material testing firm with more than 30 years of experience in providing design and construction support services for municipal and hazardous waste landfill projects for the public and private sectors. HAI has extensive experience providing QA/QC services for a variety of landfill projects throughout California and Hawaii including cell construction and expansion, evapotranspirative (ET) covers, and post-closure maintenance. HAI performs comprehensive QA/QC services including geosynthetic liner installation monitoring and testing, field density testing and oversight of mass grading, geologic inspection of slope cuts and landfill floor subgrade, field permeability testing, and comprehensive laboratory testing of geo-materials and concrete. HAI has also provided geotechnical design, inspection, and testing for building structures, scales, bridges, water pipelines, electrical conduits, pavement, and other infrastructure for landfill facilities. HAI’s experience covers landfill projects in large number of counties in northern, central, and southern California, Montana, and Hawaii for public and private entities.

3.0 PROJECT TEAM
Our team for this project will consist of Ben Hushmand, PhD, PE (CQA Officer, Peer Reviewer), Alex (Ashkaan) Hushmand, PhD, PE (CQA Resident Manager), and Ted Mapramook (CQA Lead Monitor).

4.0 SCOPE OF WORK
The required tasks and laboratory testing for the CQA services have been specifically stated in the CQA plan prepared by GC Environmental, Inc. (June 2010) and by SWT in the January 21, 2022 email sent by Mr. Brian Reyes of SWT. This CQA Proposal is prepared under the assumption that all sampling and testing of the geosynthetic materials (pre-construction conformance tests and during construction destructive samples testing) will be handled by the contractor and/or liner installer. The contractor/liner installer will collect and ship the samples to a third party geosynthetic testing laboratory for testing.

Exhibit "A"
pg. 16 of 21

Proposal for Construction Quality Assurance Services
Watsonville Landfill Phase III Closure & Phase IV Cell Construction SWT Civil & Environmental Engineering
HAI Proposal No. P23-1218 Page 3
HAI will perform pre-construction conformance and during construction laboratory testing of the landfill liner and closure cover soils. CQA Monitor will collect and ship the soil samples to HAI Geotechnical Testing Laboratory. HAI’s in-house geotechnical and material testing laboratory is certified by Caltrans, AASHTO Materials Reference Laboratory (AMRL) and Cement and Concrete Reference Laboratory (CCRL) programs, and City of Los Angeles, and validated by the United States Army Corps of Engineers.

The following are the tasks required for the Phase III Final Closure Construction project:
 Mobilization, Demobilization, Health & Safety Plan/AHA’s (one for combined project);  Project Initiation and Project Management: Review of project documents (construction drawings, technical specifications, construction quality assurance [CQA] plan), preconstruction meeting, project management;  CQA Field Services: Mobilization and demobilization, full time observation and testing during subgrade preparation and liner installation and placement of vegetative/protective soil layer by on-site CQA Monitor, review of field daily memorandum and test data and communication with CQA Monitor and Project Construction Manager/City of Watsonville representative by the CQA Manager/Engineer, and as-needed CQA Manager on-site or virtual weekly meetings during subgrade preparation and liner installation (this task includes cost of per diem and required testing equipment [field truck, nuclear densitometer, sand cone, Shelby tubes, oven, electronic scale, etc.]);  Geotechnical Laboratory Testing: Pre-construction conformance and during construction geotechnical laboratoring testing of subgrade, foundation, and protective/vegetative soil layers (sieve analysis, moisture-density relationships, field moisture content);  Geotechnical field testing for placement and compaction of unclassified fills per requirement of the Technical Specifications and CQA Plan; and  CQA Report for Phase III Final Closure: Preparation of draft and final CQA reports.

The scope of CQA services during construction of the Phase IV Landfill Cell are:
 Mobilization, Demobilization, Health & Safety Plan/AHA’s (one for combined project);  CQA Monitoring Personnel [full time on-site during subgrade preparation and liner installation];
 CQA Manager on-site inspection of work product and project progress during subgrade preparation & liner installation, and for attending weekly construction meeting (as-needed)  Geotechnical Laboratory Testing: see Phase III Closure, laboratory testing will be combined for the closure and liner projects;
 Geotechnical testing for placement and compaction of unclassified fills per requirement of the Technical Specifications and CQA Plan;
 Grain size particle analysis, moisture/density relationships & laboratory permeability tests  Review and Approve Geosynthetics material testing (to be managed by Project Contractor); and
 CQA Report (the final CQA report, including all documentation required by the CQA Plan, will be submitted within 30 days following the completion of construction).

Exhibit "A"
pg. 17 of 21

Proposal for Construction Quality Assurance Services
Watsonville Landfill Phase III Closure & Phase IV Cell Construction SWT Civil & Environmental Engineering
HAI Proposal No. P23-1218 Page 4
Clarifications

1. The overall goals of the project CQA services for the Phase III Final Closure and Phase IV Cell liner construction are as the following:
 Certify that the final closure construction, and the landfill cell liner and leachate collection and removal system (LCRS) construction were completed in accordance with the approved plans, technical specifications and CQA Plan,
 Observe and document construction of each component of the final cover system and the landfill liner and LCRS system,
 Observe, test, and document test locations and corresponding data (e.g. test results, etc.) for import materials and fill construction of the final cover foundation layer, and for various landfill liner components,
 Observe and document survey of top of the landfill cover subgrade layer prior to placement of the final cover foundation layer, and top of the landfill liner subgrade and other landfill liner layers (e.g. top of the geomembrane or GCL liner),  Document geosynthetics preconstruction material data information and testing required in the drawings and technical specifications, and CQA Plan, and  Coordinate work efforts and testing (final cover and landfill liner systems) with the landfill construction manager, design engineer, and liner installer. Follow details of the observation, testing, and reporting requirements included in the technical specifications and CQA Plan.

2. The overall construction schedule includes earthfill placement to construct the final subgrade/foundation before placement of the final cover foundation layer, and preparation of the landfill liner subgrade including earthfill placement. Construction Quality Assurance (CQA) will begin with preparation of the subgrade for the cover foundation layer or for the landfill cell liner system.

3. The final CQA report, including all documentation required by the CQA Plan, shall be submitted within 30 days following the completion of construction.

5.0 FEES AND TERMS
Tables 1 and 2 provide estimated project costs for a period of 20 weeks and for the weekly cost of additional weeks, respectively. Our cost estimate includes responses to two (2) rounds of review comments from the Client and reviewing agencies. Any additional responses to more rounds of review comments will be charged on an actual time-and-expense basis.

Exhibit "A"
pg. 18 of 21

Proposal for Construction Quality Assurance Services
Watsonville Landfill Phase III Closure & Phase IV Cell Construction SWT Civil & Environmental Engineering
HAI Proposal No. P23-1218 Page 5

6.0 CLOSURE
We trust that this proposal meets your current needs. The scope of work outlined in this proposal will be completed in accordance with accepted geotechnical engineering principles common to the local area in which we practice. The opportunity to present this proposal to SWT is sincerely appreciated. If this proposal and its conditions meet with your approval, please sign this page and return one signed original to us. Any revisions must be agreed upon by both parties prior to commencement of work. If you have any questions or need additional information regarding this proposal, please call the undersigned at (949) 777-1266.

Thank you for choosing us to assist you,
Very truly yours, Agreement accepted by:

Hushmand Associates, Inc. SWT Civil & Environmental Engineering 12/18/2023
Ashkaan Hushmand, PE, GE Date Signature Date
Senior Staff Engineer
12/18/2023
Ben Hushmand, PhD, PE Date Please Print Name and Title
President, Principal Engineer
Attachments:

Tables 1 & 2. Cost Estimates – CQA Services
Exhibit "A"
pg. 19 of 21

Task No. Task No. of Units Unit Unit Rate Labor
Cost
Direct
Cost Total
1 Review of Available Information, Planning and Preconstruction Meeting, Project Management
CQA Officer (Review CQA Plan, Drawings, and Specifications) 6 hours $210 $1,260 CQA Manager (Review CQA Plan, Drawings, and Specifications) 8 hours $150 $1,200 CQA Monitor (Review CQA Plan, Drawings, and Specifications) 8 hours $110 $880 CQA Manager (meeting, drive time, sample pickup) 12 hours $150 $1,800 CQA Monitor (meeting, drive time, sample pickup) 12 hours $110 $1,320 Car Rental 1 days $150 $150
Per Diem (1 day, 2 people) 2 days $200 $400
Flight to site (CQA Manager & CQA Monitor) 2 item $320 $640 $7,650 2 CQA Field Services (assume 19 weeks)
CQA Officer (Project Management & Supervision) 40 hours $210 $8,400 CQA Manager (daily review of field data, communication with CQA Monitor & Project Construction Manager & City) 200 hours $150 $30,000 CQA Monitor (8 hour days, Prevailing Wage Rate) 800 hours $135 $108,000 Project Site Meetings, Assumes 2 Meetings (CQA Manager) 24 hours $150 $3,600 CQA Manager per diem 2 days $200 $400
Flight to Site (CQA Officer) 2 item $320 $640
Field Vehicle for CQA Officer 2 days $150 $300
CQA Monitor per diem 20 weeks $1,085 $21,700
Mob/Demob to Site 1 item $1,800 $1,800
Field Vehicle for CQA Monitor 100 days $75 $7,500
Field Equipment (nuclear gauge, sand cone equipment)* 100 days $35 $3,500 $185,840 3 Geotechnical Lab Testing
Lab Testing 1 item $12,000
Shipping 8 each $200 $1,600 $13,600
4 Draft & Final CQA Reports (Two Reports) including printing & shipping (Phase III Final Closure & Phase IV Cell Extension) 1 item $20,700 $20,700
Grand Total = $227,790
TABLE 1. COST ESTIMATE (Assumes 20 Weeks Construction Period) Notes: The 2 site meetings (every 10 weeks) for duration of the project is necessary to ensure quality of the QA services.

Exhibit "A"
pg. 20 of 21

Task No. Task No. of Units Unit Unit Rate Labor
Cost
Direct
Cost Total
2 CQA Field Services
CQA Officer (Project Management & Supervision) 2 hours $210 $420 CQA Manager (daily review of field data, communication with CQA Monitor & Project Construction Manager & City) 10 hours $150 $1,500 CQA Monitor (8 hour days) 40 hours $135 $5,400
CQA Monitor per diem 1 week $1,085 $1,085
Field Vehicle for CQA Monitor 5 days $75 $375
Field Equipment (nuclear gauge, sand cone equipment)* 5 days $35 $175 $8,955 Grand Total = $8,955
TABLE 2. WEEKLY COST ESTIMATE FOR ADDITIONAL WEEKS
Exhibit "A"
pg. 21 of 21

1/11/2024 7:27:54 PM
C:\Program Files\eSCRIBE\TEMP\19275125455\19275125455,,,Report - Award Bid Water Construction Materials Project No. WA23-02.docx Agenda Report
MEETING DATE: Tuesday, January 16, 2024
TO: City Council
FROM: PUBLIC WORKS & UTILITIES DIRECTOR LINDBERG

WATER DIVISION MANAGER KAYSER

SENIOR ADMINISTRATIVE ANALYST MARTINEZ
THROUGH: CITY MANAGER MENDEZ
SUBJECT: AWARD BID FOR THE PURCHASE OF WATER CONSTRUCTION

MATERIALS, RENTAL EQUIPMENT, AND SERVICES, PROJECT
NO. WA-23-02 TO GRANITE ROCK COMPANY IN AN ANNUAL
AMOUNT NOT TO EXCEED $550,000
RECOMMENDED ACTION:

Staff recommends that the City Council approve a resolution authorizing the agreement for the purchase of water construction materials, rental equipment, and services, Project No. WA-23-02 from Granite Rock Company, for an initial one (1) year period with a potential of a two (2) year extended term, commencing on agreement execution date, for an annual amount of $700,000.

BACKGROUND:

The City’s current blanket purchase order for water construction materials expired December 31, 2023. A new agreement needs to be established for the construction and maintenance of the City’s water distribution system; this includes ongoing water main line replacement projects, road resurfacing repairs, hydrant knock down repairs, and other related projects.

DISCUSSION:

On October 24, 2023, the City Council adopted Resolution No. 202-23 (CM) calling for bids from fully qualified and licensed vendors to enter an agreement with the City for the purchase of water construction materials, rental equipment, and services. The bid request provided a materials list of the most used construction materials items for water related projects. The request also included the City’s Quality Assurance Program (QAP) to ensure all materials are in line with the City’s standards. The request for bids specifically stated that interested vendors and distributors could submit qualifications and bid pricing for separate items or groups of items.

1/11/2024 7:27:54 PM
C:\Program Files\eSCRIBE\TEMP\19275125455\19275125455,,,Report - Award Bid Water Construction Materials Project No. WA23-02.docx On November 16, 2023, at 2:00 p.m. the City received only one (1) bid, from Granite Rock Company. The bid amount based on the estimated quantities was $360,418, though the purchase of materials or service will be on an as-needed basis paid at the bid unit price.

Staff recommends that a purchasing agreement be executed with Granite Rock Company in an amount not to exceed $700,000 annually to provide water construction materials, rental equipment, and services to the Water Services Division in the Public Works and Utilities Department on an as-needed basis.

STRATEGIC PLAN:

This project is consistent with the following strategic plan goal:
2-Infrastructure & Environment
FINANCIAL IMPACT:

The annual $700,000 will be paid out of the Water Enterprise Fund and is included in the adopted budget fiscal year 2023-2024 in account, 913- 7831-14833 Water Main Replacement Material.

ALTERNATIVE ACTION:

No reasonable alternative is known.

ATTACHMENTS AND/OR REFERENCES (If any):

None.

Reso No. (CM)
Meeting Date: 011624 SWZ ______ RM ______ PWU ______
1 RESOLUTION NO.__________ (CM)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

WATSONVILLE AWARDING CONTRACT TO GRANITE ROCK

COMPANY, A CORPORATION, FOR WATER CONSTRUCTION
MATERIALS, RENTAL EQUIPMENT AND SERVICES, PROJECT NO.

WA-23-02, IN THE ANNUAL AMOUNT OF $550,000; AND

AUTHORIZING CITY MANAGER TO EXECUTE SAME (FUNDED FROM

THE WATER ENTERPRISE FUND)
WHEREAS, on October 24, 2023, City Council adopted Resolution No. 202-23 (CM) approving specifications and calling for bids for Water Construction Materials, Rental Equipment, and Services, Project No. WA-23-02; and WHEREAS, pursuant to Title 3, Chapter 5 of the City of Watsonville Municipal Code, the City issued a formal notice inviting bids and bids were received on November 16, 2023, at 2:00 p.m., for the Water Construction Materials, Rental Equipment, and Services, and later tabulated by the Purchasing Officer for the consideration of the City Manager and submission to the City Council; and
WHEREAS, the City Manager has recommended that the bid from Granite Rock Company, a corporation, in an annual amount not to exceed $550,000, be accepted as the lowest responsible and responsive bidder.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATSONVILLE, CALIFORNIA, AS FOLLOWS:

1. This action is exempt from the requirements of the California Environmental Quality Act (CEQA) in accordance with CEQA Guidelines Section 15301(b), in that this project is eligible for a Class 1 “existing facilities of publicly-owned utilities used to provide electric power, natural gas, sewerage, or other public utility services” categorical exemption.

Reso No. (CM)
Meeting Date: 011624 2

2. That the Contract is hereby awarded to Granite Rock Company, a corporation, for the purchase of Water Construction Materials, Rental Equipment, and Services, in an annual amount not to exceed $550,000, in the form on file in the Office of the City Clerk.

3. The City Manager is hereby authorized and directed to execute said Contract for and on behalf of the City of Watsonville with minor revisions that may be approved by the City Manager and the City Attorney.
********************************

1/11/2024 12:47:02 PM
C:\Program Files\eSCRIBE\TEMP\12465930402\12465930402,,,Report - Award Contract Project No. WA-23-01.docx Agenda Report
MEETING DATE: Tuesday, January 16, 2024
TO: City Council
FROM: PUBLIC WORKS & UTILITIES DIRECTOR LINDBERG

WATER DIVISION MANAGER KAYSER

SENIOR ADMINISTRATIVE ANALYST MARTINEZ
THROUGH: CITY MANAGER MENDEZ
SUBJECT: RESOLUTIONS AWARDING PURCHASING AGREEMENTS FOR

THE PURCHASE OF WATER SUPPLIES, MATERIALS TO BOTH

FERGUSON ENTERPRISES, LLC AND CORE & MAIN, LP, IN AN
AMOUNT NOT TO EXCEED $400,000 EACH ANNUALLY
RECOMMENDED ACTION:

Staff recommends that the City Council approve two resolutions, one awarding an agreement for the purchase of water supplies and materials from Ferguson Enterprises, LLC., and another awarding an agreement for the purchase of water supplies and materials from Core & Main, LP; both for an initial one (1) year period with a potential of a two (2) year extended term, commencing upon agreement execution date, for an annual not to exceed amount of $400,000 for each agreement, and authorizing City Manager to execute same.

BACKGROUND:

The City’s current blanket purchase order for construction materials expires December 31, 2023. An agreement needs to be established for the purchase of water supplies and materials for the City’s water distribution system repair and replacement. This includes ongoing water main line replacement projects, road resurfacing repairs, hydrant knock down repairs, and the support to other City Departments with their related projects.

DISCUSSION:

On October 24, 2023, the City Council adopted Resolution No. 201-23 (CM) calling for bids from qualified vendors and distributors to enter into an agreement with the City for the purchase of water supplies and materials. The bid request provided a representative materials list with estimated quantities of the thirty-one (31) most used pipe, valve, fitting, and other water supplies and materials items. Actual material type and quantities ordered will be determined as needed by the City and paid for at the unit price submitted with the bid pricing sheet. The request for bids stated that interested vendors and distributors

1/11/2024 12:47:02 PM
C:\Program Files\eSCRIBE\TEMP\12465930402\12465930402,,,Report - Award Contract Project No. WA-23-01.docx could submit bid pricing for separate items or groups of items, and also stated that the City could award to more than one vendor to obtain the best value.

On November 16, 2023, at 11:00 a.m. the City received a total of three (3) bid submissions from Ferguson Enterprises, Core & Main, and Iconix Waterworks. Ferguson and Core & Main were close in pricing, at $782,200.00 and $784,802.43 respectively. Comparatively, Ferguson had slightly better pricing for valves and fittings, whereas Core & Main had slightly better pricing on PVC piping. Issuing a purchase agreement to both vendors will allow the City to obtain the lowest available price on materials and also allow for flexibility to obtain materials quickly should one vendor be unable to meet the required procurement timeframe. Iconix Waterworks pricing was the highest at $837,104.21, and therefore was not considered for a purchasing agreement.

Staff recommends that a purchasing agreement be awarded to both Ferguson Enterprises, LLC and Core & Main LP for water supplies and materials in an annual not to exceed amount of $400,000 each for the Water Services Division water main repair and replacement program.

STRATEGIC PLAN:

This project is consistent with the following strategic plan goal:
2-Infrastructure & Environment
FINANCIAL IMPACT:

The first calendar year of the annual $400,000 agreement each for Ferguson Enterprises and Core & Main will be paid out of the Water Enterprise Fund as follows:

FY 23/24:
0720-598-7537 Infrastructure Materials $50,000 total
$50,000 Ferguson Enterprise
0720-913-7831-14833 Water Main Replacement $250,000 total $100,000 Ferguson Enterprise
$150,000 Core & Main
FY 24/25:
0720-598-7537 Infrastructure Materials $100,000 total
$50,000 Ferguson Enterprise
$50,000 Core & Main
0720-913-7831-14833 Water Main Replacement $400,000 total $200,000 Ferguson Enterprise
$200,000 Core & Main
ALTERNATIVE ACTION:

Council could elect not to award an agreement or to award to only one vendor.

1/11/2024 12:47:02 PM
C:\Program Files\eSCRIBE\TEMP\12465930402\12465930402,,,Report - Award Contract Project No. WA-23-01.docx ATTACHMENTS AND/OR REFERENCES (If any):

None.

Reso No. (CM)
Meeting Date: 011624 SWZ ______ RM ______ PWU ______1
RESOLUTION NO.__________ (CM)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

WATSONVILLE AWARDING PURCHASE AGREEMENT TO FERGUSON
ENTERPRISES, LLC., A LIMITED LIABILITY COMPANY, FOR THE

PURCHASE OF WATER SUPPLIES, MATERIALS AND SERVICES,
PROJECT NO. WA-23-01, IN THE AMOUNT NOT TO EXCEED $400,000

ANNUALLY
WHEREAS, on October 24, 2023, Council adopted Resolution No. 201-23 (CM) approving specifications and calling for bids for Water Supplies, Materials and Services, Project No. WA-23-01; and
WHEREAS, pursuant to Title 3, Chapter 5 of the City of Watsonville Municipal Code, the City issued a formal notice inviting bids and bids were received on November 16, 2023, at 11:00 a.m., and later tabulated by the Purchasing Officer for the consideration of the City Manager and submission to the City Council; and WHEREAS, the request for bids specifically allows the City to award a purchasing agreement to more than one vendor at the discretion of the City; and WHEREAS, the City Manager has recommended that the bid from Ferguson Enterprises, LLC., a limited liability company, for Water Supplies, Materials and Services, Project No. WA-23-01, in an annual not to exceed amount of $400,000, be accepted as one of two lowest responsive, responsible bidders.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATSONVILLE, CALIFORNIA, AS FOLLOWS:

1. This action is exempt from the requirements of the California Environmental Quality Act (CEQA) in accordance with CEQA Guidelines Section 15378(b)(5), in that adopting a Resolution awarding purchasing agreement to Ferguson Enterprise, a corporation, for the Water Materials and Supplies does not meet CEQA’s definition of a “project”, because that action does not have the potential for resulting in either a direct

Reso No. (CM)
Meeting Date: 011624 2
physical change in the environment or a reasonably foreseeable indirect physical change in the environment and if a “project”, is exempt under the “common sense” exception (14 Cal. Code Regs. §15061 (b)(3) because it can be seen with certainty that there is no possibility that this action may have a significant effect on the environment.

2. That the purchasing agreement is hereby awarded to Ferguson Enterprises, LLC., a limited liability company, for Water Supplies, Materials and Services, Project No.

WA-23-01, in the annual not to exceed amount of $400,000, in the form on file in the Office of the City Clerk.

3. The City Manager is hereby authorized and directed to execute said agreement for and on behalf of the City of Watsonville with minor revisions that may be approved by the City Manager and the City Attorney.
********************************

Reso No. (CM) 1
Meeting Date: 011624 SWZ ______ RM ______ PWU ______
RESOLUTION NO.__________ (CM)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

WATSONVILLE AWARDING PURCHASE AGREEMENT TO CORE &

MAIN, LP, A LIMITED PARTNERSHIP, FOR THE PURCHASE OF
WATER SUPPLIES, MATERIALS AND SERVICES, PROJECT NO. WA23-01, IN THE AMOUNT NOT TO EXCEED $400,000 ANNUALLY WHEREAS, on October 24, 2023, Council adopted Resolution No. 201-23 (CM) approving specifications and calling for bids for Water Supplies Materials and Services, Project No. WA-23-01; and
WHEREAS, pursuant to Title 3, Chapter 5 of the City of Watsonville Municipal Code, the City issued a formal notice inviting bids and bids were received on November 16, 2023, at 11:00 a.m., and later tabulated by the Purchasing Officer for the consideration of the City Manager and submission to the City Council; and WHEREAS, the request for bids specifically allows the City to award a purchasing agreement to more than one vendor at the discretion of the City; and WHEREAS, the City Manager has recommended that the bid from Core & Main, LP, a limited partnership, for Water Supplies, Materials and Services, Project No. WA-23- 01, in an annual not to exceed amount of $400,000, be accepted as one of two lowest responsive, responsible bidders.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATSONVILLE, CALIFORNIA, AS FOLLOWS:

1. This action is exempt from the requirements of the California Environmental Quality Act (CEQA) in accordance with CEQA Guidelines Section 15378(b)(5), in that adopting a Resolution awarding purchasing agreement to Core and Main, LP, a corporation, for the Water Materials and Supplies does not meet CEQA’s definition of a “project”, because- that action does not have the potential for resulting in either a direct

Reso No. (CM)
Meeting Date: 011624 2
physical change in the environment or a reasonably foreseeable indirect physical change in the environment and if a “project”, is exempt under the “common sense” exception (14 Cal. Code Regs. §15061 (b)(3) because it can be seen with certainty that there is no possibility that this action may have a significant effect on the environment.

2. That the purchasing agreement is hereby awarded to Core & Main, LP, a limited partnership, for Water Supplies, Materials, and Services, Project No. WA-23-01, in the annual not to exceed amount of $400,000, in the form on file in the Office of the City Clerk.

3. The City Manager is hereby authorized and directed to execute said agreement for and on behalf of the City of Watsonville with minor revisions that may be approved by the City Manager and the City Attorney.
********************************

1/11/2024 6:46:47 PM
C:\Program Files\eSCRIBE\TEMP\18464373089\18464373089,,,APPROVAL OF CHANGE ORDER NO. 12 FOR WATSONVILLE SLOUGH CONNECTOR TRAIL PROJECT.docx
Agenda Report
MEETING DATE: Tuesday, January 16, 2024
TO: City Council
FROM: PARKS & COMMUNITY SERVICES DIRECTOR CALUBAQUIB

ROBERT BERRY, SENIOR UTILITIES ENGINEER
THROUGH: CITY MANAGER MENDEZ
SUBJECT: RESOLUTION APPROVING CONTRACT CHANGE ORDER NO. 12 FOR THE WATSONVILLE SLOUGH CONNECTOR TRAIL
PROJECT IN THE AMOUNT OF $24,120.16 AND

APPROPRIATING SUCH FUNDS FROM THE PARK LAND
IMPACT FEE FUND 0276
RECOMMENDED ACTION:

Staff recommends that the City Council adopt a resolution:

1. Approving Contract Changer Order number 12 with Granite Construction for the Watsonville Slough Connector Trail project, Project No. PK-21-01, not to exceed $24,120.16 and directing the City Manager to execute the same, and

2. Appropriating $24,120.16 from the Park Land Impact Fee Fund (0276-932-7820- 14106).

BACKGROUND:

On July 6, 2021, Council adopted Resolution No. 190-21 (CM) awarding the contract for the Watsonville Slough Connector Trail project to Granite Construction in the amount of $2,240,320. This work was for civil improvements of the Urban Greening Grant project at Ramsay Park, to install pedestrian and bicycle improvements, storm water enhancements, trees, and landscaping, and other park infrastructure improvements.

On July 12, 2022, Council adopted Resolution 145-22 (CM) approving Change Order 4, 5, and 6 adding to the Scope of Work and increasing the amount by$138,423.21 for the project.

On September 13, 2022, Council adopted Resolution No. 185-22 (CM) approving Change Order 7, 8, and 9 adding to the Scope of Work and increasing compensation in the amount of $836,872.06 for the project.

1/11/2024 6:46:47 PM
C:\Program Files\eSCRIBE\TEMP\18464373089\18464373089,,,APPROVAL OF CHANGE ORDER NO. 12 FOR WATSONVILLE SLOUGH CONNECTOR TRAIL PROJECT.docx
DISCUSSION:

Starting in August 2021, and reaching substantial completion in June 2023, the final product of the Watsonville Slough Connector Trail project was comprised of three phases.

Phase 1 included an ADA accessible concrete path of travel from the entrance at Harkins Slough Road down to the renovated Central Plaza area next to the pump track and softball field. Another accessible path was built on the south side of the Nature Center parking lot, as well as an asphalt path bordering the slough and construction of a new overlook.

Phase 2 was revised to construct a new asphalt basketball court on the north side of the park next to the Ramsay Family center. This phase included a new accessible path of travel from the Main Street entrance to the center and the court, new rain gardens, and bench seating on the south and west sides of the court.

Phase 3 upgraded the original plan at the Nature Center lot to install tree wells, a new bioswale, a new concrete walkway on the north side, and new asphalt paving throughout.

In its inception, the original Watsonville Slough Connector Trail plan was designed to meet Urban Greening grant requirements and was separate in its design from any future work at Ramsay. When a Ramsay master plan was developed, and plans and funding for the Ramsay Renaissance project became a reality with full funding, it was determined that some of the WSCT project should be redesigned to accommodate and enhance the Renaissance design, and at the same time meet the original grant requirements. This resulted in some negotiated costs with the awarded contractor, Granite Construction, and a revised contract amount as set forth by Contract Change Order 9, which covered the costs of Phase 3.

As Phase 3 was being constructed, staff saw additional opportunities to better the design to serve the public and staff. This resulted in additional costs set forth in Contract Change Order 12. CCOs 10 and 11 were zero amount changes to the contract total due to contingency incorporated into Change 9. But Change Order No. 12, in finalizing the total project cost, resulted in an addition of $24,120.16 to the contract.

Staff has reviewed all the remaining change orders and is requesting that Contract Change Order 12 be added to the contract total. Approval of this change order would complete the Watsonville Slough Connector trail project, which now stands as the initial phase of the Ramsay Park Renaissance.

STRATEGIC PLAN:

The Watsonville Slough Connector Trail project supports Strategic Plan Priorities:
3-Infrastructure & Environment
5-Community Engagement & Well-Being

1/11/2024 6:46:47 PM
C:\Program Files\eSCRIBE\TEMP\18464373089\18464373089,,,APPROVAL OF CHANGE ORDER NO. 12 FOR WATSONVILLE SLOUGH CONNECTOR TRAIL PROJECT.docx
FINANCIAL IMPACT:

Staff recommends that the $24,120.16 be appropriated from the Park Land Impact Fee Fund (0276-932-7820-14106), which is an appropriate use of Impact Fees Funds.

ALTERNATIVE ACTION:

There are no real alternatives for approving Change Order No. 12, as that work has been completed.

ATTACHMENTS AND/OR REFERENCES (If any):

None.

Reso No. ______ (CM)
Reference: Reso No.’s 190-21, 145-22, 185-22 (Amend)
Meeting Date: 011624 SWZ ______ RM ______ PWU ______
1 RESOLUTION NO. (CM)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

WATSONVILLE APPROVING CONTRACT CHANGE ORDER NUMBER
12 WITH GRANITE CONSTRUCTION COMPANY, A CORPORATION,

FOR THE WATSONVILLE SLOUGH CONNECTOR TRAIL PROJECT AT
RAMSAY PARK, AN URBAN GREENING GRANT PROJECT, NO. PK-21- 01, IN AN AMOUNT NOT TO EXCEED $24,120.16; DIRECTING CITY MANAGER TO EXECUTE SAME; AND APPROPRIATING SUCH FUNDS

FROM THE PARK LAND IMPACT FEE FUND
WHEREAS, on or about July 6, 2021, the City Council adopted Resolution No. 190- 21 (CM) awarding bid of $2,240,320.00 to Granite Construction Company for the Watsonville Slough Connector Trail Project at Ramsay Park, an Urban Greening Grant Project, No. PK-21-01; and
WHEREAS, this project required eleven (11) change orders due to additional work for unforeseen conditions and design improvements, those change orders totaled $1,192,622.62; and
WHEREAS, Change Order Number 12 will approve extra costs for unforeseen conditions and design improvements; and
WHEREAS, Contract Change Order Number 12 increases contract amount by $24,120.16 (from contract amount prior to this change order of $3,432,942.62 to $3,457,062.78).

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATSONVILLE, CALIFORNIA, AS FOLLOWS:

1. This action is exempt from the requirements of the California Environmental Quality Act (CEQA). First, this project is eligible for a Class 1 “existing facilities” categorical exemption (14 Cal. Code Regs. §15301(c)) because it involves the minor alteration of existing public facilities and topographical features, including bicycle and pedestrian trails, and similar facilities, and involves negligible or no expansion of use. Second, this project

Reso No. ______ (CM)
Reference: Reso No.’s 190-21, 145-22, 185-22 (Amend)
Meeting Date: 011624
2 is eligible for a Class 4 “minor alternations to land” categorical exemption (14 Cal. Code Regs. §15304) because the project consists of minor public or private alterations in the condition of land, water, and/or vegetation which do not involve removal of healthy; mature, and scenic trees. Third, this project is eligible for a Class 33 “small habitat restoration projects” categorical exemption because the project entails removal of invasive plants within the park to enhance habitat in conjunction with native habitat landscaping within previously disturbed areas of the park.

2. That Contract Change Order Number 12 with the Granite Construction Company for the Watsonville Slough Connector Trail Project at Ramsay Park, an Urban Greening Grant Project, No. PK 21-01, adding to the scope of work and increasing contract compensation in an amount not to exceed $24,120.16, a copy of which Change Order No. 12 is attached hereto and incorporated herein by this reference, is hereby approved.

3. That the City Manager be and is hereby authorized and directed to execute Contract Change Order Number 12 on behalf of the City of Watsonville with minor revisions that may be approved by the City Manager and the City Attorney.

4. That the budget appropriation of $24,120.16 from the Park Land Impact Fee Fund [0276] is hereby authorized.
************************************

12-15-2023 Brian Hussar Construction Manager

1/11/2024 7:37:49 PM
C:\Program Files\eSCRIBE\TEMP\19374673174\19374673174,,,Report - Chrisp Co 1st Amendment On-Call Striping.docx Agenda Report
MEETING DATE: Tuesday, January 16, 2024
TO: City Council
FROM: PUBLIC WORKS & UTILITIES DIRECTOR LINDBERG

ASST PUBLIC WORKS & UTILITIES DIRECTOR FONTES
THROUGH: CITY MANAGER MENDEZ
SUBJECT: APPROVE CONTRACT AMENDMENT #1 WITH CHRISP

COMPANY FOR THE ON CALL STRIPING IN AN AMOUNT NOT
TO EXCEED $350,000
RECOMMENDED ACTION:

Staff recommends the City Council adopt a resolution approving Amendment No. 1 to the contract with Chrisp Company in the amount of $141,550 for On-Call Striping for a total not to exceed contract amount of $350,000.

BACKGROUND:

On July 25, 2023, staff publicly advertised the On-Call Striping, Project No. ST-23-01 QB maintenance contract. Bids were publicly opened on August 17, 2023, and only one bid response was received. On August 29, 2023, the City Council adopted Resolution 163-23 (CM), awarding the On-Call Striping, Project No. ST-23-01 QB, maintenance contract to the Chrisp Company in an amount not to exceed $208,450.

DISCUSSION:

The City owns and maintains approximately 90 lane miles of striping. The City’s traffic crew provides routine striping maintenance. However, larger scope projects, particularly on high traffic volume arterial streets, require the striping maintenance work to be contracted out.

Staff have identified additional streets for striping and marking. Therefore, additional funds are needed to ensure that the on-call services for striping can continue for the identified streets. Staff recommends that the City Council approve the first contract amendment with Chrisp Company for a new total compensation amount not-to-exceed $350,000.

STRATEGIC PLAN:

This project is consistent with the following strategic plan goals.

1/11/2024 7:37:49 PM
C:\Program Files\eSCRIBE\TEMP\19374673174\19374673174,,,Report - Chrisp Co 1st Amendment On-Call Striping.docx 2-Infrastructure & Environment
5-Public Safety
FINANCIAL IMPACT:

The first contract amendment will increase the total contract value from $208,450 to $350,000. Funding for this amendment is included in the City’s approved budget in account:
0306-924-7837-15081 Citywide Restriping
ALTERNATIVE ACTION:

The City Council may choose not to approve the first contract amendment. Doing so would cause a gap in the maintenance of street striping and markings.

ATTACHMENTS AND/OR REFERENCES (If any):

None.

Reso No. (CM)
Reference: Reso No. 163-23 (CM)
Meeting Date: 011624 SWZ ______ RM ______ PWU ______
1 RESOLUTION NO.__________ (CM)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

WATSONVILLE APPROVING FIRST AMENDMENT TO CONTRACT

FOR PROFESSIONAL SERVICES BETWEEN THE CITY OF

WATSONVILLE AND CHRISP COMPANY, A CORPORATION, FOR THE
ON CALL STRIPING, PROJECT NO. ST-23-01QB; INCREASING THE CONTRACT COMPENSATION IN THE AMOUNT OF $141,455 FOR A
REVISED TOTAL CONTRACT AMOUNT OF $350,000; AND

AUTHORIZING AND DIRECTING THE CITY MANAGER TO EXECUTE
SAME
WHEREAS, on August 29, 2023, the City Council adopted Resolution No. 163-23 (CM) awarding a contract to Chrisp Company, a corporation, for the On-Call Striping, Project No. ST-23-01QB, in an amount not to exceed $208,450; and WHEREAS, staff have identified additional streets for striping, and additional funding is needed for striping and marking these streets; and WHEREAS, this First Amendment to Contract will increase compensation by $141,550 for a total contract amount not to exceed $350,000.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATSONVILLE, CALIFORNIA, AS FOLLOWS:

1. This action is exempt from the requirements of the California Environmental Quality Act (CEQA). This project is eligible for a Class 1 “existing facilities” categorical exemption (14 Cal. Code Regs. §15301(c)12) because it involves the painting of curbs, crosswalks, bus stops, parking spaces and land markings.

2. The First Amendment to the Contract between the City of Watsonville and Chrisp Company, a corporation, a copy of which is attached hereto and incorporated herein by this reference, is hereby approved.

3. The City Manager is hereby authorized and directed to execute said Amendment for and on behalf of the City of Watsonville with minor revisions that may be

Reso No. (CM)
Meeting Date: 011624 2
approved by the City Manager and the City Attorney.
**************************************

CITY OF WATSONVILLE
Public Works and Utilities Department
CONTRACT CHANGE ORDER No. 1 Contract No. 2834
Project Name: On-Call Striping City Project No. ST-23-01 QB Contractor: Chrisp Company
Description of Work:

Total Amount of Change Order: $141,550.00
Accepted By Contractor:

Chrisp Company Date
City Approval:

Project Manager Date Director Public Works & Utilities Date If Cumulative Change Order Percentage is Greater Than 15% the Following Signatures are also required:

Director of Administrative Service Date City Manager Date Contract Summary:

The Original Contract Sum:

Net Change by Previously Authorized Change Orders
The Contract Sum Prior to this Change Order:

Amount of this Change Order:

The New Contract Sum Including this Change Order:

Cumulative Change Order Percentage Increase 68%
$141,550.00
$350,000.00
This change order constitutes full and complete compensation for all labor, equipment, materials, overhead, profit, any and all indirect costs and time adjustment required to perform the above described change. All work shall be completed in accordance with the applicable provisions of the Contract Documents.

The City has identified additional streets for striping and marking. The work consists of, generally, pavement markings and striping at various locations throughout City, and any associated work required to complete the scope such as grinding and disposal of existing striping, traffic control, installation of reflective markers, and such other items or details, not mentioned above, that are required by the contract documents shall be performed, placed, constructed or installed.

By reason of this order the time of completion will be adjusted as follows: 0 Days $208,450.00
$0.00
$208,450.00

1/11/2024 5:15:45 PM
Q:\COUNCIL\2024\011624\purchases with Cooper Machinery for FYE 2024.docx Agenda Report
MEETING DATE: Tuesday, January 16, 2024
TO: City Council
FROM: PUBLIC WORKS & UTILITIES DIRECTOR LINDBERG
THROUGH: CITY MANAGER MENDEZ
SUBJECT: AUTHORIZATION OF A PURCHASE ORDER FOR SOLE SOURCE

PURCHASING WITH COOPER MACHINERY SERVICES LLC FOR THE

PURCHASE OF PARTS USED IN THE WASTEWATER TREATMENT

FACILITY COGENERATION SYSTEM IN THE AMOUNT OF
$179,498.20 FOR FISCAL YEAR 2023-2024
RECOMMENDED ACTION:

Adopt a resolution that authorizes the sole source1 purchasing agreement with Cooper Machinery Services LLC, for the purchase of parts used by the cogeneration system located at the wastewater treatment facility in the amount of $179,498.20 for Fiscal Year 2023-2024. The contract will not be competitively bid for the reasons set forth in this Report.

BACKGROUND:

Total payments made to Cooper Machinery Services LLC for parts purchases so far total $93,390.27 and will exceed $100,000 this fiscal year. Therefore, consistent with the City’s Charter, the City Council must approve a purchasing agreement.

DISCUSSION:

A cogeneration system at the City’s wastewater treatment facility produces enough electricity and hot water to support all treatment processes, and comprises an internal combustion engine, electrical generator, and ancillary support equipment. Major annual maintenance is performed on the engine, which has been operating since the late 1980’s. The engine is a Cooper-Superior brand and model, and the parts are proprietary. Cooper Machinery Services LLC (“Cooper”) is the only supplier of spare parts for this engine.

One important component of the engine is the turbocharger. To facilitate quick replacement of the turbocharger every other year during the annual rebuild, or in case of failure of the one in service, staff keeps a replacement unit in the spare parts inventory. The turbocharger in 1 Subdivision (c) of § 3-5.210 of the Municipal Code exempts from competitive bidding “Equipment, supplies or nonprofessional services (that) are unique, available only from one (1) source, or sought to match existing equipment or supplies already in use (also known as a sole source purchase).”

1/11/2024 5:15:45 PM
Q:\COUNCIL\2024\011624\purchases with Cooper Machinery for FYE 2024.docx service recently failed and staff installed the spare. The failed unit was sent to Turbocharger Solutions International, a division of Cooper, and a quote was provided for the cost of the rebuild.

A second critical component of the engine is the exhaust manifold. An exhaust leak has developed, causing the engine to shut down, and the manifold must be replaced immediately in order to resume cogeneration operations. Staff requested a quote for a replacement and expedited delivery. A third necessary component in need of replacement at this time are ignition coils and an associated support rail.

Furthermore, additional known maintenance is needed this fiscal year and staff has prepared a cost estimate based on previous invoices for the required parts as follows:

Item Unit Cost Number Total
Oil filters $60.00 12 $720.00
Filter Housing clamps $76.00 4 $304.00
Thermocouplers $347.00 2 $694.00
Subtotal $1,718.00
tax $167.51
freight (estimated) $1,000.00
Total Estimated Cost $2,885.51
Last, one outstanding invoice for costs related to the annual overhaul work is due.

The total cost breakdown for this purchasing agreement is $86,107.93, as follows:

Item Cost
Turbocharger $45,629.28
Exhaust Manifold $12,621.78
Ignition Coils and Rail $5,384.27
Additional Parts (est.) $2,885.51
Outstanding Invoice $19,587.09
Total $86,107.93
With the $93,390.27 in payments already made, the total sum amount for this purchasing agreement is $179,498.20.

STRATEGIC PLAN:

This purchasing agreement is consistent with Strategic Plan Priority:
3 – Infrastructure & Environment

1/11/2024 5:15:45 PM
Q:\COUNCIL\2024\011624\purchases with Cooper Machinery for FYE 2024.docx FINANCIAL IMPACT:

Funds for this purchase order are available in the Wastewater Enterprise Fund budget account number 0710-911-7855-14328.

ALTERNATIVE ACTION:

None currently due to the specialized nature of these parts.

ATTACHMENTS AND/OR REFERENCES (If any):

1. Price Quotation – Turbocharger

2. Price Quotation – Exhaust Manifold

3. Price Quotation – Ignition Coils and Rail

4. Cooper Invoice 91410913

Turbocharger Solutions International
Turbocharger Solutions International
Division of Cooper Machinery Services
1404 MOHAWK ROAD
MCPHERSON KS 67460-3256
USA
Phone 620-241-8740
Fax 620-241-8744
Document number : US05/RU13/111127828

Date Issued : NOV 16 2023
Payment Terms ZN30-Net 30 Days From Date Of
Invce
Terms and conditions :As Attached/Included
Incoterms :FCA-Free Carrier
Free Carrier
Freight Terms :

QUOTATION
Sold to : 120967
City of Watsonville Water Resources
500 Clearwater Lane
Watsonville CA 95076-9556
USA
Ship to : 120967
City of Watsonville Water Resources
500 Clearwater Lane
WATSONVILLE CA 95076-9556
USA
Inside Sales Contact: Bradley Smith
Email: [email protected]
Outside Sales Contact AM : Mike Perez PH:562-818-2094
Email: [email protected]
Customer Reference : Pending
Valid From : NOV 16 2023
Valid To : DEC 16 2023
MCPHERSON JOB MP31090 / 40032532 / 602018393
QUOTE: 25084
MAN NR20/106 TURBOCHARGER, S/N 1167304
ORDERED BY BRADLEY STOKE.

Item Material Number Extended Weight Qty UM Unit Net Price Extended Price Description USD USD
015000 SHOP LABOR-TSI 0.000 lb 1 EA 13,157.78 13,157.78

SHOP LABOR-TSI
Disassemble
Clean and Inspect Bladed Disc
Rebuild and Zyglo Turbine Blades
Polish and Measure Shaft; Check Straightness
Install New Thrust Collar
Clean and Inspect Impeller
Balance Rotor Assembly
Clean and Inspect Nozzle Ring; Check Square Inch Opening Clean, Inspect, and Measure Diffuser
Clean and Inspect Turbine Case
Install New Turbine Case
Machine Piping Surfaces on all Cases
Reassemble
Paint
Prepare for Shipment
020000 ZMNR20R106-501-001 0.000 lb 1 EA 13,766.19 13,766.19 CASING,TURBINE-NR20/R106
Attachment 1

Document number : US05/RU13/111127828
030000 ZMNR20R106-541-001 0.000 lb 1 EA 1,392.32 1,392.32 SHROUD,EXHAUST-(INSERT)-NR20/R106
040000 SHOP PARTS-TSI 0.000 lb 1 EA 13,811.04 13,811.04

SHOP PARTS-TSI
2 - FASTENING CLAMP
1 - COUNTERSUNK SCREW
1 - TURBOCAHRGER BEARING CASING
1 - SEALING RING
1 - O-RING
1 - LABYRINTH RING
1 - LOCATING RING
2 - BEARING BUSH
1 - DISTANCE SLEAVE
1 - FIXING BOLT
1 - EXHAUST DIFFUSER
26 - STUD
26 - HEX NUT
26 - LOCING WASHER
1 - CLAMPING BRACKET
4 - COLLAR PIN
1 - SEAL
Price Summary :

Total Price : 42,127.33 USD
Inflation Surcharge : 842.55 USD
Same Day Shipment Charges: 0.00 USD
State Tax : 1,772.94 USD
County Tax : 369.36 USD
Transit Tax : 517.10 USD
Total Quotation Price : 45,629.28 USD
Attachment 1

Document number : US05/RU13/111127828
MINIMUM ORDER REQUIREMENTS: $200 Minimum for all Orders.

CREDIT TERMS: Credit Terms confirmed at time of order. Progress paymentsmay apply.

RETURN OF PRODUCTS AND ORDER CANCELLATION: Turbocharger Solutions International shall accept returns of normally stocked Goods for a period of thirty (30) days following shipment for exchange or refund of the purchase price; provided, that Goods must be in their original cartons, unopened and unused and are subject to a return inspection. Appropriate restocking/ cancellation feesequal to the greater of (1) the cost incurred by Seller as a result of the cancellation, or (2) 25% of the purchase price. Non-stocked items(made to order) and Consumable type Goods such as gaskets, O-rings, nuts, bolts, wear parts, etc. are not returnable once shipped to the Buyer and no credits or refunds can be offered to the Buyer.

EXPORT COMPLIANCE: The items, technology, or software covered by this document may be subject to various laws including U.S. and foreign export controls. Cooper Machinery Services LLC is committed to compliance with all relevant export control laws. If the items, technology, or software are of U.S. origin or are being exported from the U.S. or will be re-exported, the following language applies: "These commodities, technology or software were exported from the United Statesof America in accordance with the Export Administration
Attachment 1

TERMS AND CONDITIONS

GENERAL TERMS & CONDITIONS FOR SALE OF PRODUCTS, PARTS AND/OR SERVICES NOTICE: Any purchase by Buyer of Products, Parts and/or Services from Seller is subject to these Terms and Conditions. Any additional or different terms proposed by Buyer are expressly objected to and shall not be binding upon Seller unless expressly accepted in writing by Seller's authorized representative. Any order for Products, Parts and/or Services shall constitute acceptance of these Terms and Conditions.

1. DEFINITIONS
"Affiliate" means with respect to either party an entity (including without limitation any individual, corporation, partnership, limited liability company, association, or trust) that directly or indirectly controls, is controlled by, or is under common control with, such party.
"Applicable Law" or "Applicable Laws" means any law, statute, order, decree, rule, injunction, license, permit, consent, approval, agreement, regulation, judgment or legislative or administrative action of a competent governmental authority, which applies to the sale of Products, Parts and/or provision of Services. "Buyer" means the entity purchasing Products, Parts and/or Services and its successors and permitted assigns. "Buyer Taxes" means all existing and future taxes, duties, fees, and other charges of any nature (including, but not limited to, ad valorem, consumption, excise, franchise, gross receipts, import, export, license, property, sales and use, stamp, storage, transfer, turnover, value-added taxes ("VAT"), or other similar taxes, and any and all items of deficiency, penalty, addition to tax, interest, or assessment related thereto), imposed or assessed by any governmental authority of any country in connection with the execution of this Contract or performance of or payment for work hereunder, but excluding Seller Taxes. "Claims" means all claims, demands, causes of action, liabilities, damages, judgments, fines, penalties, awards, losses, costs, and expenses (including, without limitation, attorneys' fees and costs of litigation) of any kind or character. "Consequential Loss" means, whether direct or indirect, and whether or not foreseeable at the time of entering into the Contract or at the time of commencing performance: any loss, delay or interruption of business, profits, revenue, production or opportunity; loss of product, use or equipment; standby time; rig, vessel, or other facility or equipment downtime; cost of capital; cost of substitute equipment, facilities, services or replacement power; overhead; any special, punitive, exemplary, incidental and/or consequential damages or losses; and/or Claims of a party's customers for any of the above losses, costs or damages. "Contract" means either the contract agreement signed by both parties or the purchase order signed by Buyer and expressly accepted by Seller in writing, together with these Terms and Conditions, any other documents incorporated by reference, Seller's Proposal, and any agreed scope of work for the sale of Products, Parts, and/or Services. "Contract Price" means the aggregate amount to be paid by Buyer to Seller for the purchase of Products, Parts and/or Services, as stated in the Contract, and any agreed adjustments to the same. "Delivery" means when the Products/Parts have been delivered according to the applicable Incoterm (2010). "Deliver" shall be construed accordingly.
"Group" means with respect to either party, such party (either Buyer or Seller, as applicable), as well as its Affiliates, and in connection with the project to which the Products, Parts and/or Services relate, its joint venture partners, joint interest owners, colessees, consortium members and/or other partners, and, in respect of Buyer only, the Site owner, end user, or Site operator; and for all of the above, also its and their contractors and subcontractors of any tier in connection with said project, as well as the shareholders, officers, directors, employees, invitees, agents, and consultants of all of the foregoing. "Buyer Group" and "Seller Group" shall be construed accordingly. Seller Group does not include any member of Buyer Group and Buyer Group does not include any member of Seller Group.
"Hazardous Materials" means any chemical, substance, material, waste or emission defined, classified or regulated as hazardous or toxic, or as a pollutant, contaminant, or threat or potential threat to human health, safety or the environment under Applicable Law, including but not limited to naturally occurring radioactive material, hydrocarbons, asbestos, lead, hydrogen sulphide or polychlorinated hydrocarbons, including biphenyls and biphenols. "Indemnify" means release, defend, indemnify, and hold harmless. "Parts" means the spare or repaired parts required in relation to the Product, identified by Seller in the Contract. "Products" means all equipment, materials, supplies, software, products, and other goods (excluding Parts) as applicable, sold under the Contract.
"Proposal" means Seller's formal offer to provide the Products, Parts and/or Services, and any mutually agreed written amendments thereto.
"REGARDLESS OF CAUSE OR ACTION" MEANS (TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW), REGARDLESS OF: CAUSE, FAULT, DEFAULT, NEGLIGENCE IN ANY FORM OR DEGREE, STRICT OR

ABSOLUTE LIABILITY, BREACH OF DUTY (STATUTORY OR OTHERWISE) OF ANY PERSON, INCLUDING OF THE

INDEMNIFIED PERSON, UNSEAWORTHINESS OF ANY VESSEL, AND/OR ANY DEFECT IN ANY PREMISES/ VESSEL; FOR ALL OF THE ABOVE, WHETHER PRE-EXISTING OR NOT AND WHETHER THE DAMAGES,

LIABILITIES, OR CLAIMS OF ANY KIND RESULT FROM CONTRACT, WARRANTY, INDEMNITY, TORT/ EXTRACONTRACTUAL OR STRICT LIABILITY, QUASI CONTRACT, LAW, OR OTHERWISE. “Seller” means Cooper Machinery Services, LLC or named Cooper Affiliate signing the Contract or the purchase order, and its successors and permitted assigns.
"Seller Taxes" means all corporate income taxes imposed on Seller and any taxes imposed on Seller's employees in connection with the execution of this Contract or the performance of or payment for work hereunder by Applicable Laws. "Services" means all the services, including, without limitation, technical assistance and guidance, training, repairs, and remote diagnostics, to be provided by Seller under the Contract. "Site" means the premises where Parts or Products are used or meant to be used and/or Services are performed or meant to be performed, not including any Seller Group's premises.

2. DELIVERY, TRANSFER OF TITLE & RISK, STORAGE, LIQUIDATED DAMAGES

2.1 Unless otherwise provided in the Contract and in accordance with Incoterms 2010: (i) for shipments that do not involve an exit out of Seller's country of incorporation, Seller shall Deliver the Products/Parts to Buyer FCA Seller's facility, place of manufacturer or warehouse; (ii) for shipments within the European customs territory, Seller shall Deliver CPT - carriage paid to named place of destination; (iii) for other export shipments out of Seller's country of incorporation, Seller shall Deliver Products/ Parts to Buyer FOB, in case of transportation by sea (specifying the port of export); FCA loaded into aircraft, in case of transportation by air (specifying the airport of export); or CPT - carriage paid to named place of destination specified between the parties, in case of transportation by rail or road. The "Delivery Date" for any item of Products/Parts is defined as the date on which such item is Delivered in accordance with this Article. Partial Delivery and Delivery in advance of the Delivery schedule shall be permitted, unless otherwise specified in the Contract.

2.2 Subject to Article 2.3, title and risk of loss to Products and/or Parts shall pass upon Delivery as provided in Article 2.1, with the exception that title and risk of loss to: (i) Products and/or Parts shipped from the United States of America ("U.S.") shall pass from Seller to Buyer immediately after each item departs from the U.S. territorial land, seas and overlying airspace, which the parties acknowledge extend to twelve nautical miles from the baseline of the country, determined in accordance with the 1982 United Nations Convention of the Law of the Sea; and (ii) Products and/or Parts to be shipped to a Delivery destination directly from countries different from Seller's country of incorporation (drop shipment), shall pass immediately after each item departs from the territorial land, seas and overlying airspace of the sending country. For the avoidance of doubt, Seller or its relevant Group member shall retain title to any equipment leased to Buyer Group.

2.3 If any of the Products and/or Parts cannot be shipped to Buyer in accordance with the agreed upon Delivery terms due to any cause not attributable to Seller Group, upon notice to Buyer, Seller may store such Products and/or Parts or ship them to outside storage, in which cases: (i) any amounts otherwise payable to Seller upon Delivery or shipment shall become payable upon presentation of a certification specifying the cause and place of storage (any payment security shall allow payments upon presentation of notice to storage instead of transport documents); (ii) all expenses incurred by Seller Group, such as for preparation and placement into storage, handling, inspection, preservation, insurance, removal charges, interest, and any VAT or other taxes imposed directly or indirectly under Applicable Law shall be reimbursed or paid by Buyer upon submission of Seller's invoices; and (iii) when reasonably possible and upon payment of all amounts due hereunder, Seller shall resume Delivery of the Products and/or Parts to the originally agreed point of Delivery. Title and risk of loss to Products and/or Parts shall pass as provided in Article 2.2. , provided that Seller shall not have any obligation to store any item beyond 60 calendar days and if the storage period extends beyond 60 days, Seller shall be entitled to resume Delivery of the Products/Parts in accordance with Article

2.1 . The terms of Article 2.3 shall apply also in the event any Buyer equipment repaired at Seller Group's facilities cannot be shipped to or received by Buyer in accordance with the agreed upon terms, provided that, in the case of Buyer equipment to be repaired at Seller Group's facilities, Buyer shall retain title to, and risk of loss for, any such equipment at all times.

2.4. In the event of a delay in the Delivery of Products and/or Parts beyond the contractually agreed Delivery Date or a delay in the commencement of the performance of Services beyond the contractually agreed commencement date, if such Delivery/ commencement is not excused under the terms of the Contract, Seller Group shall be liable exclusively for the following liquidated damages, unless a different amount is set forth in the Contract: 0.5% of the price of the delayed item for each week of delay, or 0.1% of the price of the delayed Service for each day of delay, in all cases cumulatively up to a maximum amount of 5% of the overall portion of the Contract Price allocable to the delayed Services, Products or Parts. The parties agree that such liquidated damages are not a penalty and represent a fair and reasonable estimate of the damages Buyer Group may suffer as a result of delay. SAID LIQUIDATED DAMAGES SHALL CONSTITUTE THE SOLE AND EXCLUSIVE LIABILITY OF SELLER GROUP AND THE SOLE AND EXCLUSIVE REMEDY OF BUYER GROUP FOR DELAY. No liquidated damages are due unless Buyer has suffered direct economic harm.

3. EXCUSABLE DELAYS

3.1 Neither party shall be liable or considered in breach or default of its obligations to the extent performance of such obligations is delayed or prevented, directly or indirectly, due to causes beyond the impacted party's reasonable control, including but not limited to: (i) acts of God, acts or omissions of governmental authorities, fire, severe weather conditions, earthquake, strikes or other labor disturbances, flood, serious risk of kidnapping, war (declared or undeclared), armed conflict, acts or threats of terrorism, epidemics, civil unrest, riot, severe delay in transportation, severe car shortage, or inability to obtain necessary materials, components or services; (ii) in the case of Seller, acts or omissions of Buyer Group, including failure to timely provide Seller Group with access, information, tools, material, and approvals necessary to permit Seller Group to timely perform the required activities, and including, without limitation, unknown physical conditions at the Site of an unusual nature and differing materially from those ordinarily encountered and generally recognized as occurring in the work of the character provided for in the Contract. The affected party shall promptly notify the other party in the event of a delay under this Article. The Delivery or performance dates shall be extended for a period equal to the time lost by reason of such delay, plus such additional time as may be reasonably necessary to overcome the effect of such delay. If Seller is delayed by acts or omissions of Buyer Group, or by the prerequisite work of Buyer's other contractors, Seller shall also be entitled to an equitable price adjustment. Under no circumstances shall Buyer's payment obligation be deemed excusable under this Article.

3.2 If a delay excused by this Article 3 extends for more than 90 days and the parties have not agreed upon a revised basis for resuming work, including an equitable price adjustment, then either party (except where delay is caused by Buyer Group, in which event only Seller), upon 30 days written notice may terminate the Contract with respect to the unexecuted portion of the work. In the event of a delay under Article 3.1(ii), the terms of Article 10.2 shall apply in full. In the event of a delay under Article 3.1(i), Buyer shall pay Seller the pro-rated Contract Price for all work performed before the effective date of termination.

4. WARRANTY

4.1 Subject to the limitations set forth in the Contract, Seller warrants to Buyer that: (i) the Products and/or Parts shall be Delivered free from defects in material, workmanship and title; and (ii) the Services shall be performed in a competent and diligent manner in accordance with any mutually agreed specifications. Unless Seller expressly agrees otherwise in writing and except for Products/Parts provided by Seller's Affiliates, any Parts not manufactured by Seller (including incidental materials and consumables used in the Services) shall carry only the warranty provided by the original manufacturers, and Seller gives no warranty for such Parts.

4.2 Unless otherwise stated in the Contract, the warranty period ("Warranty Period") shall be as follows: (i) for each Product (excluding Parts), 12 months from Start-Up date, or 8,600 running hours, or 18 months from the date of Delivery, or from the date of notice that the Products are ready for shipment, if the Delivery cannot take place for reasons not attributable to Seller Group, or from the date of notice that the Products are put into storage under Article 2.3, whichever occurs first; (ii) for Services, one year after performance of the Service; (iii) for Parts, 18 months after Delivery or 12 months after installation, whichever occurs first; (v) for repaired, replaced, or re-performed Products, Parts, or Services, six months after repair/replacement or re-performance, provided that Seller Group's warranty obligations shall in all cases terminate and in no event extend beyond 24 months after Delivery or placement into storage of the original Products/Parts or performance of the initial Service. As used herein, "Start-Up" means the equipment start-up activities to be carried out by Buyer in connection with the Products not later than 30 days from Seller's written notification that the Products are ready for start-up.

4.3 If Products, Parts, or Services do not meet the above warranties during the applicable Warranty Period and Buyer informs Seller in writing within 15 days of discovery, Seller's sole and exclusive liability shall be to either re-perform the defective Services, or repair or replace the defective component of the Products/Parts, at Seller's option. If despite Seller's reasonable efforts, a non-conforming Product/Part cannot be repaired or replaced, or non-conforming Services cannot be re-performed, the parties will negotiate an equitable adjustment in price with respect to such Product, Parts, component, or Service. Seller Group shall not under any circumstances be liable for defects that arise or are discovered after expiration of the Warranty Period.

4.4 Seller shall not be liable for accessing, retrieving, removing, or decontaminating defective Products or Parts, or for reinstalling repaired or replacement Products/Parts, or for any costs, damages, or losses incurred in connection with any of the above operations. Seller shall be responsible to transport defective Products or Parts only to and from the original Delivery point.

Buyer shall be responsible for all customs formalities, costs and taxes connected with any export to Seller or import of goods sent back to Buyer.

4.5 Seller does not warrant the Products, Parts or any repaired or replacement item against: normal wear and tear, including that due to environment, excessive operation at peak capability, frequent starting, type of fuel, detrimental air inlet conditions or erosion, corrosion or material deposits from fluids, misuse, accident, modification, heating, machining, bending, welding, alteration of any kind, or operation under conditions more severe than, or otherwise exceeding those set forth in, the specifications for the relevant Product or Part. The warranties and remedies set forth herein are further conditioned upon: (i) proper storage, installation, use, operation, and maintenance of the Products/Parts, and conformance with the operation instruction and installation manuals (including revisions thereto) provided by Seller Group; (ii) Buyer keeping accurate and complete records of operation and maintenance during the Warranty Period and providing Seller access to those records; and (iii) repair or modification pursuant to Seller's instructions and approval. Failure to meet any such conditions in Article 4.5 renders the warranty null and void.

4.6 THE REMEDIES SET FORTH IN ARTICLE 4 CONSTITUTE THE SOLE AND EXCLUSIVE REMEDIES FOR ALL

CLAIMS ARISING OUT OF OR RELATING TO ANY FAILURE OF, OR ANY DEFECT OR NON-CONFORMITY IN, THE

PRODUCTS, PARTS, OR SERVICES, REGARDLESS OF WHEN THE FAILURE, DEFECT OR NON-CONFORMITY ARISES AND REGARDLESS OF CAUSE OR ACTION. THE WARRANTIES SET FORTH IN ARTICLE 4 ARE

EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES, CONDITIONS, AND GUARANTEES, WHETHER WRITTEN, ORAL, IMPLIED, OR STATUTORY. NO IMPLIED OR STATUTORY WARRANTY OR CONDITION OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE SHALL APPLY.

Attachment 1

4.7 All Parts Delivered shall conform to Seller's part or version number specified in the Contract, or its equivalent or the superseding number subsequently assigned by Seller. If the number ordered is no longer available, Seller is authorized to provide a valid interchangeable Part without notice to Buyer.

5. INSPECTION AND FACTORY TESTS - The quality control exercised by Seller in its manufacture of Products/Parts shall be in accordance with Seller's normal quality control policies, procedures and practices. Unless otherwise expressly agreed in the Contract, Seller shall attempt to accommodate Buyer's requests to witness Seller's factory tests of Products/Parts, but only if such witnessing can be arranged without delaying the work. Access to Seller Group's premises shall be limited to areas directly concerned with the Products/Parts, excluding in all cases areas where work of a proprietary nature is conducted.

6. CHANGES - Each party may at any time propose changes in the schedule or scope of Parts, Products or Services in the form of a draft change order. Neither party is obligated to proceed with the changed schedule or scope until both parties agree to such change in writing. Unless otherwise agreed by the parties, pricing for additional work arising from such changes shall be at time and material rates.

7. PAYMENT

7.1 Buyer shall pay to Seller all invoiced amounts Net 30 days when due or in a timely manner according to the Contract. If nothing is agreed in the Contract, payment shall be made in US dollars or the currency set forth in the Seller’s proposal. Seller reserves the right to require Payment Milestones or require one or more irrevocable, unconditional, letters of credit payable at sight (“Payment Security”), without any set-off,and in the currency agreed in the Contract(or on the face of the purchase order). In the event Buyer requests payment by credit card, Seller at its option may add a 3% surcharge to the applicable Contract Price for processing fees associated with credit card transactions.

7.2 In addition to other Contract remedies, Buyer shall pay interest to Seller at the rate of 1.5% per month (or fraction thereof), not to exceed the lesser of 18% per annum or the maximum amount permitted by Applicable Law, on all amounts not timely paid in accordance with the Contract.

7.3 If applicable, each Payment Security shall be irrevocable and unconditional, and allow for pro-rata payments for partial Deliveries, other charges (e.g., storage, export shipments, cancellations, and adjustments), and all other payments due to Seller under the Contract. Each Payment Security shall be: (i) issued or confirmed by a primary international bank that is reasonably acceptable to Seller; (ii) payable at the counters of such bank; (iii) opened 30 days from the Contract effective date; and (iv) remain in effect until the latest of 90 days after the latest scheduled Products/Parts shipment, or completion of Services, or receipt by Seller of final payment. Buyer shall make relevant adjustments in the Payment Security (including increasing amounts or validity period, and including in accordance with the changes agreed in the Contract) as required to fulfill its payment obligations under the Contract, within 15 business days of Seller's notification that such adjustment is necessary. Seller will not have an obligation to begin performance until the Payment Security, or the required adjustment thereof, has become operative.

8. TAXES AND DUTIES

8.1 Seller shall be responsible for and shall pay when due and payable all Seller Taxes, and Buyer shall be responsible for and shall pay all Buyer Taxes. The Contract Price does not include any Buyer Taxes. Therefore, if any such taxes are applicable, they will be added to the Contract Price. For U.S. sales and use tax, and in other jurisdictions where applicable, Buyer may report/remit sales or similar taxes directly if Buyer timely provides a direct pay or exemption certificate to Seller.

8.2. If the Applicable Laws require the Contract to be subject to stamp duty, fee, or registration, Buyer shall be responsible for the required formalities and bear the related costs. Buyer shall return to Seller a copy of the registration certificate or a registered copy of the Contract within 10 days from the due date required by said Applicable Laws to register or pay for such stamp duty, fee, or registration. According to the Applicable Laws of the country in which Buyer has requested Seller to provide Services, Seller may be required to be registered locally, in which case, Seller shall perform the Services and invoice for them with the intervention of its relevant branch or permanent establishment.

8.3 If Buyer is required to deduct or withhold any Seller Taxes from the Contract Price, Buyer shall (1) give at least 30 days' notice to Seller that Buyer will withhold, (2) make all reasonable efforts to minimize any withholding tax from payments to Seller, in accordance with Applicable Laws and any applicable bilateral conventions against double taxation, and (3) provide to Seller, within 30 days from payment, the official receipt issued by the competent government authority to which the Seller Taxes have been paid, or an alternative document acceptable to the relevant tax authorities. . If Buyer requires tax residence certificates or other documentation from Seller to apply for any exempted or reduced tax regime, Seller shall submit the appropriate certificates upon Buyer's written request. If Buyer, under the Applicable Laws of any country other than Seller's country of incorporation or in which Seller has a branch, deducts or withholds Seller Taxes or fails to comply with the requirements of this clause, Buyer shall pay additional amounts to Seller so that Seller receives the full amount of the Contract Price, as though no such Seller Taxes had been deducted or withheld.

8.4 If Buyer benefits from any tax, fee or duty exemption which is applicable to Seller or Seller's Group, Buyer agrees to provide Seller, without charge and before the following as applicable: (1) entering into the Contract, (2) before invoicing, or (3) before any other relevant event, documentation acceptable to the competent tax authorities supporting the exemption, together with instructions on the exemption procedure. Buyer shall promptly inform Seller in writing about the revocation, expiry or other change of the exemption. If Seller is denied the exemption because of a failure of Buyer, Seller shall be entitled to invoice and Buyer shall pay promptly the applicable tax, fee or duty.

8.5 When Buyer arranges the export or intra-European Union ("EU") community shipment, Buyer will provide to Seller, free of charge and within 90 days (or, in the case of exports from the U.S., 30 days), evidence (obtained from Buyer's forwarder) of exportation or intra EU community shipment; such evidence must be in a form that is acceptable to the competent tax and customs authorities. Failing the above, Seller shall be entitled to invoice Buyer the applicable VAT, U.S. sales and use tax, or similar taxes.

9. ASSIGNMENT, NOVATION & SUBCONTRACTING - Buyer may assign or novate the Contract, in full or in part and including through change of ownership, only with the prior consent of Seller, which consent shall not be unreasonably delayed or withheld, provided that Seller shall be entitled to withhold such consent only for demonstrable reasons if the assignee/novatee lacks adequate financial capability, is a competitor or potential competitor of Seller or its Affiliates, causes Seller Group to be in breach of Applicable Law, and/or does not meet Seller's code of ethics. Seller may assign or novate to third parties the Contract, in full or in part, only with the prior consent of Buyer, which consent shall not be unreasonably delayed or withheld, provided that Seller may, without Buyer's consent: (i) assign or novate the Contract, in full or in part, to one or more Affiliates of Seller; and (ii) assign any receivables due hereunder to one or more Affiliates of Seller. The parties agree to execute such documents as may be necessary to effect the permitted assignments or novations. In the event of a novation or assignment by Buyer, Buyer shall cause the novatee/assignee to provide additional payment security at Seller's reasonable request. Any assignment or novation in violation of the above shall be void and without effect for the other party. Nothing herein shall restrict Seller from subcontracting portions of its work, provided that Seller remains responsible to Buyer for performance of such work.

10. TERMINATION AND SUSPENSION

10.1 Either party may terminate this Contract for default if: (i) any proceeding is brought against the other party, voluntarily or involuntarily, under applicable bankruptcy or insolvency laws, or if the other party is unable to pay its debts when due, to the extent permitted by Applicable Law; or (ii) the other party commits a material breach of this Contract, which does not otherwise have a specified contractual remedy, and fails to cure the breach within 30 days of notice from the non-breaching party, or if it is not possible to cure such breach within 30 days, fails to commence to cure the breach within 30 days of such notice or fails to thereafter continue diligent efforts to complete the cure as soon as reasonably possible. In the event of a termination by Buyer under this Article 10.1, Seller shall reimburse Buyer the difference between that portion of the Contract Price allocable to the terminated scope and the actual amounts reasonably incurred by Buyer to complete such terminated scope; and Buyer shall pay to Seller the portion of the Contract Price allocable to Products/Parts purchased and/or completed, and amounts for Services performed, before the effective date of termination. Said amounts shall be calculated using the applicable Contract rates, or in the absence of such rates, at Seller's then-current standard time and material rates. In the event there are agreed-upon Contract milestones, said amounts shall be calculated in accordance with the milestone schedule for completed milestones, and the Contract rates for work toward milestones not yet achieved.

10.2 Buyer may terminate the Contract (even in part) with a 20-day prior written notice for reasons other than those set forth in Article 10.1, in which case Buyer shall pay Seller's charges in accordance with the Contract termination schedule; or if no such schedule exists: (i) Buyer shall pay Seller all costs and expenses incurred by Seller in connection with work performed before the effective date of termination, plus a reasonable margin percentage in relation to such costs and expenses, which margin percentage shall not be lower than the margin percentage applicable to the overall Contract; or (ii) for Contracts based on payment milestones Buyer shall pay Seller: (a) all amounts due under the Contract for completed milestones, plus (b) all costs and expenses incurred by Seller in connection with work performed in relation to incomplete milestones, plus a reasonable margin percentage in relation to such costs and expenses, which margin percentage shall not be lower than the margin percentage applicable to the overall Contract. In connection with both (i) and (ii), Buyer shall also pay Seller the costs and expenses incurred by Seller as a direct result of the termination, including the costs associated with vendor disputes or Claims.

10.3 If Buyer fails to pay any outstanding undisputed invoice as set forth in the Contract, or fails to issue the Payment Security within the time agreed, Seller, upon a 15-day notice to Buyer, may suspend performance and Delivery. Any cost incurred by Seller as a result of such suspension (including storage, stand-by costs, demobilization and re-mobilization costs) shall be payable by Buyer upon submission of Seller's invoices. Performance of Seller's obligations shall be extended for a period equaling the period of Buyer's failure to meet its payment obligations, plus such additional time as may be reasonably necessary to overcome the effect of such payment delay. If suspension for Buyer’s failure to pay an undisputed invoice or failure to issue thePayment Security exceeds 15 days, Seller may at is sole option immediately terminate the applicable Contract for cause and Buyer shall also pay Seller the costs and expenses incurred by Seller as a direct result of the termination, including the costs associated with vendor disputes or Claims, plus a reasonable margin percentage in relation to such costs and expenses.

10.4 With a 20-day written prior notice, Buyer may elect to suspend performance of the Contract for a maximum cumulative period of 90 days, after which Seller may terminate the Contract and Article 10.2 shall apply. In the event of suspension under this Article 10.4, Buyer shall also pay all reasonable expenses incurred by Seller in connection with the suspension, including without limitation, expenses for repossession, fee collection, stand-by costs, demobilization/remobilization, and costs of storage. The schedule for Seller's obligations shall be extended for a period of time reasonably necessary to overcome the effects of such suspension.

11. COMPLIANCE WITH LAWS, CODES AND STANDARDS

11.1 The Contract Price is based on Seller Group's design, manufacture, testing, and Delivery of the Products, Parts and Services pursuant to: (i) its design criteria, manufacturing processes, and procedures and quality assurance program; (ii) those portions of industry specifications, codes, and standards in effect as of the date of entering into the Contract as are specified in the Contract; (iii) Applicable Law; and (iv) any mutually agreed-upon written terms and specifications set forth in the Contract.

11.2 Notwithstanding any other provision of this Contract, the parties shall at all times comply with Applicable Law in the performance of the Contract, except for Seller to the extent that such compliance is penalized under, or otherwise violates, the laws of the United States or any European Union laws.

11.3 Seller is entitled to an equitable adjustment to the Contract Price and the Delivery schedule to reflect any additional costs and other impact incurred by Seller Group as a result of a change in Applicable Law or applicable standards and regulations, including changes in the interpretation thereof, after entering into the Contract. In the event any such change prevents Seller Group from executing its obligations without breaching Applicable Law or makes Seller's execution of its ob ligations unreasonably burdensome or unbalanced, Seller shall also have the right to withdraw its Proposal or terminate the Contract without any liability.

11.4 Unless otherwise agreed in the Contract, Seller shall be responsible for timely obtaining the permits, licenses, and authorizations required for Seller Group to meet the requirements of the Contract, except that Buyer shall be responsible for timely obtaining any required permits, licenses, and authorizations that can only be obtained by Buyer Group. Buyer and Seller shall provide each other reasonable assistance in obtaining the required authorizations.

11.5. Buyer agrees that it will not sell, distribute, disclose, release or otherwise transfer any item or technical data provided under this Contract to: (i) any country designated as a "State Sponsor of Terrorism" by the U.S. Department of State including, for this Agreement, the countries of Cuba and North Korea (ii) any entity located in, or owned by an entity located in, a "State Sponsor of Terrorism" country or Cuba or North Korea, (iii) the region of Crimea or (iv) any person or entity listed on the "Entity List" or "Denied Persons List" maintained by the U.S. Department of Commerce, the list of "Specifically Designated Nationals and Blocked Persons" maintained by the U.S. Department of Treasury or any other applicable prohibited party list of the US Government. This clause will apply regardless of the legality of such a transaction under local law. Except as otherwise agreed in writing between the parties, each Party shall be responsible for obtaining and maintaining any authorization required for its performance under this Contract (including the transfer any item or technical data under this Contract), such as export license, import license, exchange permit or other required government export or import authorization. Each Party shall provide the reasonable assistance necessary for the other Party to secure and comply with such authorizations as may be required. Neither Party shall be liable if any government export authorization is delayed, denied, revoked, restricted or not renewed despite reasonable efforts by the Party. Additionally, such delay, denial, revocation or non-renewal shall not constitute a breach of this Agreement.

Buyer shall not use any items sold hereunder for any military application, or resell them for such purpose.

12. ENVIRONMENT, HEALTH, SAFETY AND SECURITY (EHSS)

12.1 Buyer shall take all actions necessary to provide a safe, healthy and secure work environment, including transportation and accommodation if applicable, for Seller Group personnel. Buyer shall inform Seller of any known risks, hazards, or changed conditions impacting worker health, safety or the environment, including the presence or potential presence of Hazardous Materials, and shall provide relevant information, including safety data sheets, site security plans, risk assessments and job hazard analyses.

12.2 To evaluate risks associated with the provision of Services and performance under this Article, Buyer shall provide Seller Group with reasonable access to review the Site and related equipment. If Seller's work at the Site is subject to local, state or national EHS legal requirements that are not reasonably available, Buyer shall notify and provide copies of same to Seller.

12.3 If Seller or Seller's representative believes in good faith that Site conditions, Seller transportation or accommodation provisions, or the actions of others threaten the health, safety, or security of Seller Group personnel or the environment, Seller or its representatives may, in addition to other rights or remedies available, STOP WORK, evacuate some or all of its personnel, suspend performance of all or any part of the Contract, and/or remotely perform or supervise work. If Seller exercises its rights under this provision, it shall give prompt notice to Buyer, and the parties shall work cooperatively to correct the conditions or actions prompting the STOP WORK. The parties agree there shall be no retaliation taken against any person who invokes their right under this provision to STOP WORK. Any delay resulting from Seller Group's exercise of its rights under this Article shall constitute an excusable delay.

12.4 To the full extent permitted by Applicable Law, Buyer agrees that it is the generator, and shall be solely responsible for the storage, transportation and disposal of all Hazardous Materials or waste related to or arising from the performance of Services at Buyer Group sites, including any removed from Seller's equipment. Prior to the transportation and disposal of waste materials by Buyer, Seller shall properly handle and manage all Hazardous Materials resulting from the Services in accordance with Applicable Law and Buyer's written requirements. If Seller Group encounters any Hazardous Materials, it may suspend work pending Buyer elimination of the hazardous condition. If any Seller equipment or Buyer equipment destined for a Seller facility is contaminated with Hazardous Materials, Buyer shall assume sole responsibility for decontaminating such equipment and returning it in the same condition received to allow for its safe handling and transportation in compliance with Applicable Law. If any such Hazardous Materials cause an increase in Seller's cost or time, Seller shall be entitled to an equitable adjustment in price and schedule.

13. ADDITIONAL EHSS PROVISIONS APPLICABLE TO SERVICES

13.1 Seller Group personnel shall not be required to work in excess of any time restriction prescribed by Applicable Law. Seller Group personnel will have at least one day of rest in any seven consecutive days; provided, the parties may agree upon exceptions consistent with Seller's working time policy.

13.2 Buyer shall provide medical care and facilities at the Site consistent with international industry standards. If Seller Group's personnel require urgent medical attention, Buyer shall make its medical facilities available to such persons as necessary. To the Attachment 1

extent Buyer cannot supply necessary urgent medical attention at the Site or any Buyer Group's site or while working offshore, Buyer shall provide for transport of Seller Group's personnel and access of such personnel to the nearest suitable urgent care facility. For offshore or remote work, Buyer shall be responsible for the medical evacuation of Seller Group's personnel from the Site to the departure point on the mainland or Buyer's designated medical services provider.

13.3 Buyer shall transport Seller Group's personnel, equipment and materials, including medi-vac, to and from all offshore locations and to such other job Sites as agreed, in compliance with Applicable Law and international industry standards regarding qualified personnel and safe operation and maintenance. Buyer Group agrees to make such equipment and information relating to its operation and maintenance available to Seller for review. Buyer shall provide personal protective equipment required during use of Buyer provided transportation to and from the offshore work and such other specialized equipment as agreed between the parties.

13.4 Buyer shall provide, at no cost to Seller, accommodation and messing for Seller Group's personnel, which offers a reasonable degree of comfort, is consistent with international industry standards and is at least comparable to that furnished to Buyer's management and technical personnel. Buyer shall provide telephone and computer internet connectivity to Seller Group's personnel at said accommodations.

14. CONFIDENTIALITY

14.1 "Confidential Information" means pricing for Parts, Products, and Services, and/or information that is designated in writing as "confidential" or "proprietary" at the time of disclosure, or orally designated as "confidential" or "proprietary" and confirmed in writing within ten days after oral disclosure. Confidential Information shall not include information that: (i) is or becomes generally available to the public other than from disclosure by the receiving party's Group; (ii) is or becomes available to the receiving party's Group on a non-confidential basis from a source other than the disclosing party and, after due inquiry, that source is not subject to a confidentiality obligation to the disclosing party; or (iii) is independently developed by the receiving party's Group without reference to the disclosing party's Confidential Information, as evidenced by written documents.

14.2 The parties shall: (i) use, reproduce, or disclose the other party's Confidential Information only in connection with the Contract and permitted use(s) and maintenance of Products, Parts and Services; (ii) take reasonable measures to protect the confidentiality, and prevent disclosure and unauthorized use of the Confidential Information and (iii) in particular, not disclose Confidential Information to the other party's competitors.

14.3 A party may disclose Confidential Information: (i) to any member of its Group who has a need to know to perform the Contract or use and maintain Products, Parts, or Services and who is bound in writing to confidentiality obligations and use restrictions at least as restrictive as in this Contract; and (ii) to comply with a legal obligation, but only after promptly notifying the disclosing party of its disclosure obligation so that the disclosing party may seek an appropriate protective order. Buyer shall not disclose Confidential Information to Seller unless required for Seller to perform under this Contract. Buyer warrants that it has the right to disclose the information and shall Indemnify Seller Group from any Claims or damages resulting from improper disclosure.

14.4 Neither party shall make any public announcement about any aspect of the Contract or related documents or information without prior written approval of the other party.

14.5 The confidentiality and use restrictions of this Article 14 shall survive any termination of the Contract for ten years. Each party shall Indemnify the other for failure to comply with this provision.

15. INTELLECTUAL PROPERTY

15.1 Seller shall Indemnify Buyer from any rightful Claims of third parties that the Products or Parts manufactured by Seller or its Affiliates infringe any utility patent of the U.S., EU, or the country of initial installation (if set forth in the Contract), provided that: (i) Buyer promptly notifies Seller in writing of any such claim; (ii) Buyer makes no admission of liability and does not take any position adverse to Seller regarding such claim and gives Seller authority, at Seller's expense, to direct and control all defense, settlement and compromise negotiations; and (iii) Buyer provides Seller with full disclosure and assistance that may be reasonably required to defend any such claim.

15.2 Seller shall have no obligation or liability with respect to any claim based upon: (i) any Products, Parts or Services that have been altered, modified, or revised; (ii) the combination, operation, or use of any Products, Parts or Services with other products or services when such combination is part of any allegedly infringing subject matter; (iii) failure of Buyer Group to implement any update provided by Seller Group that would have prevented the claim; (iv) unauthorized use of Products, Parts or Services, including without limitation a breach of the provisions of the Contract; or (v) Products, Parts or Services made or performed to Buyer Group's specifications.

15.3 Should any Products, Parts or Services become the subject of a claim, Seller may at its option: (i) procure for Buyer the right to continue using the Product, Part or Service, or portion thereof; (ii) modify or replace it in whole or in part to make it noninfringing; or (iii) failing (i) or (ii), take back Products or Parts, discontinue Services, and refund any fees received by Seller attributable to the infringing Product, Part or Service.

15.4 THE FOREGOING STATES SELLER GROUP'S ENTIRE AND EXCLUSIVE LIABILITY FOR ANY INTELLECTUAL AND INDUSTRIAL PROPERTY RIGHTS INFRINGEMENT.

15.5 Each party shall retain ownership of all Confidential Information and intellectual property it had prior to the negotiations of the Contract. Any and all new intellectual property conceived, created or provided by Seller Group under the Contract, whether alone or with any contribution from Buyer Group, shall be owned exclusively by Seller or other members of Seller Group, as the case may be. To the extent that Buyer Group may acquire any right or interest in such new intellectual property, Buyer irrevocably assigns, and agrees to assign and/or cause other members of Buyer Group to assign, all such rights and interests in such new intellectual property as instructed by Seller, and to execute assignments and other documentation as necessary to achieve this result. To the extent permissible by law, Buyer Group waives any moral rights it acquires in any such new intellectual property.

Seller shall grant Buyer use rights to utilize Seller's intellectual property embedded in the Products or Parts solely for standard use, operation, and maintenance of the Products/Parts by Buyer. Such license shall not give Buyer the right to manufacture and/or have manufactured such Products/Parts to the extent such maintenance will result in substantially new Products/Parts.

15.6 If Seller provides any Products that are software, including SaaS (Software as a Service), embedded software, or software that is installed on Buyer Group's equipment, the terms of the annexed Software License Addendum, shall apply. If there is any conflict between these Terms and Conditions and the terms of the Software License Addendum, the terms of the Software License Addendum shall prevail.

15.7 Buyer agrees that Seller may create, receive, maintain, transmit and otherwise have access to machine, technical, system, usage and related information, including, but not limited to, information about Buyer's products, services, systems and software, that is gathered periodically to facilitate the provision of Products, Parts, Services, other support, consulting, training and other services to Buyer (if any), and to verify compliance with the terms of this Contract. Seller and its Affiliates may use such information to provide, develop or improve their products or services.

16. INDEMNITY, LIMITATION OF LIABILITY, AND INSURANCE The provisions of Article 16 shall apply to the maximum extent permitted by Applicable Law and, unless otherwise expressly stated, prevail over any conflicting clauses.

16.1 (i) Seller agrees to Indemnify Buyer Group from and against any and all Claims for bodily injury, illness, or death suffered by any Seller Group's personnel, and/or for damage to or loss of any property of any Seller Group member (whether owned, hired, or leased, but excluding property leased to Buyer Group) arising out of or in connection with the Contract, REGARDLESS OF CAUSE OR ACTION. (ii) Buyer agrees to Indemnify Seller Group from and against any and all Claims for bodily injury, illness, or death suffered by any Buyer Group's personnel, and/or for damage to or loss of any property of any Buyer Group member (whether owned, hired, or leased, and including the Products and Parts (after Delivery), the Site, and any facilities or property thereon), arising out of or in connection with the Contract, REGARDLESS OF CAUSE OR ACTION.

16.2(i) Seller agrees to Indemnify Buyer Group from and against any rightful Claims of third parties on account of bodily injury, illness or death, or damage to or loss of property, to the extent resulting directly from the negligence of Seller Group in connection with performance of the activities under this Contract. (ii) Buyer agrees to Indemnify Seller Group from and against any rightful Claims of third parties on account of bodily injury, illness or death, or damage to or loss of property, to the extent resulting directly from the negligence of Buyer Group in connection with the activities performed under this Contract. (iii) In the event the injury or damage to third parties is caused by the joint or concurrent negligence of the parties or their respective Groups, each party shall bear such injury or damage proportionally to its Group's negligence. For the avoidance of doubt, no members of either party's Group shall be considered third parties and, for purposes of Seller's indemnity obligation in Article 16.2(i), no part of the Site or any property or facilities thereon shall be considered as third party property, and the Site owner and its partners, affiliates and contractors/subcontractors shall not be considered third parties. The reciprocal indemnities in this Article 16.2 shall apply only if the indemnified party: (i) promptly notifies the other in writing of the third party claim; (ii) makes no admission of liability, does not take any position adverse to the other party and gives such other party's authority to direct and control all defense, settlement and compromise negotiations; and (iii) provides the other party with full disclosure and assistance as may be reasonably required to defend such claim.

16.3 Except only as provided in Article 16.1(i) but notwithstanding anything else to the contrary herein, in the event the Site is offshore, Buyer assumes sole responsibility for and shall Indemnify the Seller Group (to the maximum extent permitted under applicable law) from and against any and all Claims asserted by or in favor of any person or party resulting from pollution, contamination or blow-out of any kind and including costs of pollution control, removal, spills, leakage, and clean-up. The above indemnity applies REGARDLESS OF CAUSE OR ACTION and even if the claim is on account of any defect in the Products, Parts or Services; but it shall not apply to surface pollution or spillage of fuels, lubricants, sewage or garbage to the extent such surface pollution or spillage originates from Seller Group's property while such property is in Seller Group's sole care, custody and control.

16.4 EXCEPT ONLY FOR SELLER'S OBLIGATIONS IN ARTICLES 8.1, 15, 16.1(i), AND 11.2 (TO THE EXTENT OF

FINES AND PENALTIES IMPOSED BY A GOVERNMENT AUTHORITY AS A RESULT OF SELLER'S VIOLATION OF

APPLICABLE LAW), SELLER GROUP'S TOTAL LIABILITY FOR ANY AND ALL CLAIMS OF ANY KIND,

REGARDLESS OF CAUSE OR ACTION, ARISING OUT OF OR RELATED TO THE CONTRACT, OR ITS

PERFORMANCE OR BREACH, INCLUDING WITHOUT LIMITATION WARRANTY AND TERMINATION, SHALL NOT UNDER ANY CIRCUMSTANCES EXCEED: (I) IN THE CASE OF CLAIMS RESULTING FROM THE PROVISION OR

FAILURE TO PROVIDE, OR FROM THE USE OR FAILURE TO USE PRODUCTS OR PARTS, THE CONTRACT PRICE ALLOCABLE TO THE PRODUCT AND/OR PARTS GIVING RISE TO THE CLAIM; AND (II) IN THE CASE OF CLAIMS

RESULTING FROM THE PROVISION OR FAILURE TO PROVIDE SERVICES, THE CONTRACT PRICE ALLOCABLE TO THE SERVICES GIVING RISE TO THE CLAIM. SELLER GROUP SHALL HAVE NO LIABILITY FOR ADVICE OR

ASSISTANCE GRATUITOUSLY PROVIDED BY SELLER GROUP BUT NOT REQUIRED PURSUANT TO THE CONTRACT. ALL SELLER GROUP'S LIABILITIES SHALL TERMINATE AT THE END OF THE RELEVANT

WARRANTY PERIOD, EXCEPT FOR CLAIMS THAT HAVE BEEN TIMELY COMMENCED BY BUYER IN ACCORDANCE WITH THE CONTRACT.

16.5 UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL LOSS. NOTWITHSTANDING ANYTHING TO THE CONTRARY, AND EXCEPT ONLY TO THE

EXTENT OF AGREED LIQUIDATED DAMAGES AND ANY PREDETERMINED TERMINATION FEES DUE TO SELLER

UNDER THE CONTRACT, SELLER SHALL INDEMNIFY BUYER GROUP FROM AND AGAINST ANY AND ALL DIRECT OR INDIRECT CLAIMS FOR CONSEQUENTIAL LOSS OF SELLER GROUP; AND BUYER SHALLINDEMNIFY

SELLER GROUP FROM AND AGAINST ANY AND ALL DIRECT OR INDIRECT CLAIMS FOR CONSEQUENTIAL LOSS OF BUYER GROUP REGARDLESS OF CAUSE OR ACTION.

16.6 NOTWITHSTANDING ARTICLE 16.2(i), IN THE EVENT BUYER GROUP PROVIDES PRODUCTS OR PARTS TO A

THIRD PARTY OR USES SELLER'S PRODUCTS/PARTS AT A FACILITY NOT OWNED BY BUYER, OR THE

SERVICES ARE PERFORMED AT A FACILITY NOT OWNED BY BUYER, BUYER SHALL INDEMNIFY SELLER

GROUP FOR AND AGAINST ANY LIABILITY ARISING OUT OF CLAIMS MADE IN EXCESS OF THE LIMITATIONS AND EXCLUSIONS SET FORTH IN THE CONTRACT, REGARDLESS OF CAUSE OR ACTION. IN THE EVENT BUYER

ASSIGNS OR NOVATES THE CONTRACT, IN WHOLE OR IN PART, SUCH ASSIGNEE OR NOVATEE SHALL BE

BOUND BY THE SAME TERMS OF THIS CONTRACT, AND BUYER HEREBY WAIVES ANY RIGHT TO CLAIM,

WHETHER IN TORT, AT LAW OR OTHERWISE, FOR DAMAGES OR LIABILITIES OF ANY KIND IN EXCESS OF THE LIMITATIONS AND EXCLUSIONS SET FORTH IN THE CONTRACT.

16.7 Buyer and Seller each covenant and agree to support their mutual indemnity obligations under Article 16 by procuring and maintaining, at the indemnifying party's sole expense, insurance policies meeting the following requirements: (i) Workers Compensation/Employer's Liability as per Applicable Law; (ii) Comprehensive General Liability: Combined Single Limits for Bodily Injury and Property Damage $1,000,000 (one million) per occurrence and $2,000,000 (two million) in the aggregate (or its equivalent in another relevant currency), which may be satisfied through a combination of underlying and excess coverages. The parties agree that, to the extent of the indemnifying party's liability and indemnity obligations under this Contract, the indemnifying party's General Liability policies shall include the indemnified party Group as additional insured<(>,,<)> contain blanket contractual liability coverage, be primary, and receive no contribution from any insurance policies maintained by or on behalf of the indemnified party. Each party, on request, shall provide to the other party insurance certificates evidencing the aforementioned limits and terms of insurance. Buyer and Seller shall each arrange for any of their respective insurance policies hereunder to contain provisions whereby, to the extent of each party's liability and indemnity obligations under this Contract, their insurers waive their rights of subrogation against the other party's Group, as well as the other party's respective insurers.

17. NO NUCLEAR USE - The Products, Parts and/or Services are not intended or authorized for use in connection with any nuclear facility or activity, and Buyer warrants that it shall not use, or permit others to use, Products, Parts and/or Services in connection with or for any such purposes without the advance written consent of Seller. If, in breach of the foregoing, any such use occurs, Seller hereby disclaims any and all liability for any nuclear or other damage, injury, or contamination REGARDLESS OF CAUSE OR ACTION. In addition to any other rights of Seller and to the maximum extent permitted under Applicable Law, Buyer assumes sole responsibility for, and shall Indemnify Seller Group from and against, any and all Claims asserted by or in favor of any person or party resulting from any nuclear or other damage, injury, or contamination REGARDLESS OF CAUSE OR ACTION. Consent of Seller to any use in connection with any nuclear facility or activity, if any, will be conditioned upon additional terms and conditions that Seller determines to be acceptable for protection against nuclear liability.

18. ADDENDA - If any Products/Parts include executable binary code, or if Seller provides any remote diagnostic, rental tools, training, or other special Services, the terms of the respective annexed Cybersecurity Services Addendum, Remote Diagnostic Services Addendum, Rental Tools Addendum, Training Addendum and/or other addendum shall apply. If there is any conflict between these Terms and Conditions and the terms of any applicable addendum, the terms of the applicable addendum shall prevail.

19. GOVERNING LAW - This Contract shall be governed by and construed in accordance with the laws of (i) the State of New York, if Seller is incorporated in the U.S.; or (ii) England and Wales, if Seller is incorporated outside the U.S., excluding in any case conflict of law rules.

20. DISPUTE RESOLUTION - Any dispute arising out of or in connection with this Contract shall be referred to settlement proceedings under the International Chamber of Commerce (ICC) Mediation Rules, without prejudice to either party's right to seek emergency, injunctive, or conservatory measures of protection at any time. If any such dispute has not been settled within 60 days following the filing of a Request for Mediation (or such other period of time as may be reasonable under the circumstances or agreed in writing), the dispute shall be finally settled in accordance with the ICC Rules of Arbitration by one or more arbitrators appointed under the said Rules. The seat, or legal place, of arbitration shall be (i) Houston, Texas USA.

21. GENERAL CLAUSES

21.1 Except as otherwise expressly provided with regard to the members of each party's Group, none of the terms herein are intended to be enforced by third parties under the United Kingdom Contracts (Rights of Third Parties) Act (1999), where applicable. Buyer and Seller shall be entitled to modify, vary, amend and/or extinguish such rights without the consent of any third parties or member of either party's Group.

21.2 This Contract represents the entire agreement between the parties and no modification, amendment, rescission, waiver or other change shall be binding on either party unless agreed to in writing by their authorized representatives. Each party agrees that it has not relied on, or been induced by, any representations of the other party not contained in the Contract.

21.3 The invalidity in whole or in part of any part of this Contract shall not affect the validity of the remainder of the Contract. In Attachment 1

Cooper Machinery Services is an equal opportunity employer and gives all qualified applicants consideration of employment without regard to race, color, religion, age, sex, sexual orientation, gender identity,genetic information, national origin, disability status, protected veteran status, or any other characteristic protected by federal, state, or local laws. the event any provision of this Contract is held invalid or unenforceable, only the invalid or unenforceable part of the provision shall be severed, leaving intact and in full force and effect the remainder of the sentence, clause and provision to the extent not held invalid or unenforceable.

22. U.S. GOVERNMENT CONTRACTS

22.1 This Article 22 applies only if the Contract is for the direct or indirect sale to any agency of the U.S. government and/or is funded in whole or in part by any agency of the U.S. government. Buyer agrees that all Products, Parts and Services provided by Seller meet the definition of "commercial-off-the-shelf" ("COTS") or "commercial item" as those terms are defined in Federal Acquisition Regulation ("FAR") 2.101. To the extent the Buy American Act, Trade Agreements Act, or other domestic preference requirements are applicable to this Contract, the country of origin of Products/Parts is unknown unless otherwise specifically stated by Seller in this Contract. Buyer agrees any Services offered by Seller are exempt from the Service Contract Act of 1965 (FAR 52.222-41). The version of any applicable FAR clause listed in this Article 22 shall be the one in effect on the effective date of this Contract.

22.2 If Buyer is an agency of the U.S. government, then as permitted by FAR 12.302, Buyer agrees that all paragraphs of FAR

52.212-4 (except those listed in 12.302(b)) are replaced with these Terms and Conditions. Buyer further agrees the subparagraphs of FAR 52.212-5 apply only to the extent applicable for sale of COTS and/or commercial items and as appropriate for the Contract Price.

22.3 If Buyer is procuring the Products, Parts or Services as a contractor, or subcontractor at any tier, on behalf of any agency of the U.S. government, then Buyer agrees that FAR 52.212-5(e) or 52.244-6 (whichever is applicable) applies only to the extent applicable for sale of COTS and/or commercial items and as appropriate for the Contract Price. If the reasonableness of the price cannot be established through adequate price competition, or if cost or pricing data should be required for any other reason, or if a Product, Part or Service cannot be considered a "commercial item", Seller may terminate the Contract without penalty and be reimbursed for work done before the effective date of termination.

22.4 Seller reserves the right to reject any order from a Buyer listed on any denied party list.

COOPER MACHINERY SERVICES - TERMS & CONDITIONS FOR SALE OF PRODUCTS, PARTS & SERVICES February 1, 2022 COOPER MACHINERY SERVICES©
Attachment 1

Cooper Machinery Services
Cooper Machinery Services LLC
Deer Park Sales Off
1100 GEORGIA AVE
DEER PARK TX 77536-2522
USA
Phone 281-930-0060
Document number : US05/RU16/111128493

Date Issued : DEC 04 2023
Payment Terms ZN30-Net 30 Days From Date Of
Invce
Terms and conditions :As Attached/Included
Incoterms :FCA-Free Carrier
Free Carrier
Freight Terms :

QUOTATION
Sold to : 120967
City of Watsonville Water Resources
500 Clearwater Lane
Watsonville CA 95076-9556
USA
Ship to : 120967
City of Watsonville Water Resources
500 Clearwater Lane
WATSONVILLE CA 95076-9556
USA
Inside Sales Contact: Jason Music
Email: [email protected]
Outside Sales Contact AM : Mike Perez PH:562-818-2094
Email: [email protected]
Customer Reference : RFQ - EXHAUST MANIFOLD
Valid From : DEC 04 2023
Valid To : JAN 03 2024
Item Material Number Extended Weight Qty UM Unit Net Price Extended Price Description USD USD
000010 ZUX033-509 0.000 lb 1.000 PC 3,047.46 3,047.46

MANIFOLD,EXHAUST (EXCHANGE)
CMIR : CORE CHARGE $7,000
Lead Time : IN STOCK
000020 Z034-971 0.400 lb 8 EA 26.06 208.48

GASKET FLAT RECT
Lead Time : IN STOCK
000030 Z006-093 8.000 lb 8 EA 346.94 2,775.52

THERMOCPLE
Lead Time : IN STOCK
000040 FREIGHT-SP 0.000 lb 1 EA 5,800.00 5,800.00
Freight Charges
Attachment 2

Document number : US05/RU16/111128493
Lead Time : IN STOCK
Price Summary :

Total Price : 11,831.46 USD
Inflation Surcharge : 236.63 USD
Same Day Shipment Charges: 0.00 USD
State Tax : 369.13 USD
County Tax : 76.90 USD
Transit Tax : 107.66 USD
Total Quotation Price : 12,621.78 USD
MINIMUM ORDER REQUIREMENTS: $200 Minimum for all Orders.

CREDIT TERMS: Credit Terms confirmed at time of order. Progress paymentsmay apply.

RETURN OF PRODUCTS AND ORDER CANCELLATION: Cooper Machinery Services shall accept returns of normally stocked Goods for a period of thirty (30) days following shipment for exchange or refund of the purchase price; provided, that Goods must be in their original cartons, unopened and unused and are subject to a return inspection. Appropriate restocking/ cancellation feesequal to the greater of (1) the cost incurred by Seller as a result of the cancellation, or (2) 25% of the purchase price. Non-stocked items(made to order) and Consumable type Goods such as gaskets, O-rings, nuts, bolts, wear parts, etc. are not returnable once shipped to the Buyer and no credits or refunds can be offered to the Buyer.

EXPORT COMPLIANCE: The items, technology, or software covered by this document may be subject to various laws including U.S. and foreign export controls. Cooper Machinery Services LLC is committed to compliance with all relevant export control laws. If the items, technology, or software are of U.S. origin or are being exported from the U.S. or will be re-exported, the following language applies: "These commodities, technology or software were exported from the United Statesof America in accordance with the Export Administration

Attachment 2

TERMS AND CONDITIONS

GENERAL TERMS & CONDITIONS FOR SALE OF PRODUCTS, PARTS AND/OR SERVICES NOTICE: Any purchase by Buyer of Products, Parts and/or Services from Seller is subject to these Terms and Conditions. Any additional or different terms proposed by Buyer are expressly objected to and shall not be binding upon Seller unless expressly accepted in writing by Seller's authorized representative. Any order for Products, Parts and/or Services shall constitute acceptance of these Terms and Conditions.

1. DEFINITIONS
"Affiliate" means with respect to either party an entity (including without limitation any individual, corporation, partnership, limited liability company, association, or trust) that directly or indirectly controls, is controlled by, or is under common control with, such party.
"Applicable Law" or "Applicable Laws" means any law, statute, order, decree, rule, injunction, license, permit, consent, approval, agreement, regulation, judgment or legislative or administrative action of a competent governmental authority, which applies to the sale of Products, Parts and/or provision of Services. "Buyer" means the entity purchasing Products, Parts and/or Services and its successors and permitted assigns. "Buyer Taxes" means all existing and future taxes, duties, fees, and other charges of any nature (including, but not limited to, ad valorem, consumption, excise, franchise, gross receipts, import, export, license, property, sales and use, stamp, storage, transfer, turnover, value-added taxes ("VAT"), or other similar taxes, and any and all items of deficiency, penalty, addition to tax, interest, or assessment related thereto), imposed or assessed by any governmental authority of any country in connection with the execution of this Contract or performance of or payment for work hereunder, but excluding Seller Taxes. "Claims" means all claims, demands, causes of action, liabilities, damages, judgments, fines, penalties, awards, losses, costs, and expenses (including, without limitation, attorneys' fees and costs of litigation) of any kind or character. "Consequential Loss" means, whether direct or indirect, and whether or not foreseeable at the time of entering into the Contract or at the time of commencing performance: any loss, delay or interruption of business, profits, revenue, production or opportunity; loss of product, use or equipment; standby time; rig, vessel, or other facility or equipment downtime; cost of capital; cost of substitute equipment, facilities, services or replacement power; overhead; any special, punitive, exemplary, incidental and/or consequential damages or losses; and/or Claims of a party's customers for any of the above losses, costs or damages. "Contract" means either the contract agreement signed by both parties or the purchase order signed by Buyer and expressly accepted by Seller in writing, together with these Terms and Conditions, any other documents incorporated by reference, Seller's Proposal, and any agreed scope of work for the sale of Products, Parts, and/or Services. "Contract Price" means the aggregate amount to be paid by Buyer to Seller for the purchase of Products, Parts and/or Services, as stated in the Contract, and any agreed adjustments to the same. "Delivery" means when the Products/Parts have been delivered according to the applicable Incoterm (2010). "Deliver" shall be construed accordingly.
"Group" means with respect to either party, such party (either Buyer or Seller, as applicable), as well as its Affiliates, and in connection with the project to which the Products, Parts and/or Services relate, its joint venture partners, joint interest owners, colessees, consortium members and/or other partners, and, in respect of Buyer only, the Site owner, end user, or Site operator; and for all of the above, also its and their contractors and subcontractors of any tier in connection with said project, as well as the shareholders, officers, directors, employees, invitees, agents, and consultants of all of the foregoing. "Buyer Group" and "Seller Group" shall be construed accordingly. Seller Group does not include any member of Buyer Group and Buyer Group does not include any member of Seller Group.
"Hazardous Materials" means any chemical, substance, material, waste or emission defined, classified or regulated as hazardous or toxic, or as a pollutant, contaminant, or threat or potential threat to human health, safety or the environment under Applicable Law, including but not limited to naturally occurring radioactive material, hydrocarbons, asbestos, lead, hydrogen sulphide or polychlorinated hydrocarbons, including biphenyls and biphenols. "Indemnify" means release, defend, indemnify, and hold harmless. "Parts" means the spare or repaired parts required in relation to the Product, identified by Seller in the Contract. "Products" means all equipment, materials, supplies, software, products, and other goods (excluding Parts) as applicable, sold under the Contract.
"Proposal" means Seller's formal offer to provide the Products, Parts and/or Services, and any mutually agreed written amendments thereto.
"REGARDLESS OF CAUSE OR ACTION" MEANS (TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW), REGARDLESS OF: CAUSE, FAULT, DEFAULT, NEGLIGENCE IN ANY FORM OR DEGREE, STRICT OR

ABSOLUTE LIABILITY, BREACH OF DUTY (STATUTORY OR OTHERWISE) OF ANY PERSON, INCLUDING OF THE

INDEMNIFIED PERSON, UNSEAWORTHINESS OF ANY VESSEL, AND/OR ANY DEFECT IN ANY PREMISES/ VESSEL; FOR ALL OF THE ABOVE, WHETHER PRE-EXISTING OR NOT AND WHETHER THE DAMAGES,

LIABILITIES, OR CLAIMS OF ANY KIND RESULT FROM CONTRACT, WARRANTY, INDEMNITY, TORT/ EXTRACONTRACTUAL OR STRICT LIABILITY, QUASI CONTRACT, LAW, OR OTHERWISE. “Seller” means Cooper Machinery Services, LLC or named Cooper Affiliate signing the Contract or the purchase order, and its successors and permitted assigns.
"Seller Taxes" means all corporate income taxes imposed on Seller and any taxes imposed on Seller's employees in connection with the execution of this Contract or the performance of or payment for work hereunder by Applicable Laws. "Services" means all the services, including, without limitation, technical assistance and guidance, training, repairs, and remote diagnostics, to be provided by Seller under the Contract. "Site" means the premises where Parts or Products are used or meant to be used and/or Services are performed or meant to be performed, not including any Seller Group's premises.

2. DELIVERY, TRANSFER OF TITLE & RISK, STORAGE, LIQUIDATED DAMAGES

2.1 Unless otherwise provided in the Contract and in accordance with Incoterms 2010: (i) for shipments that do not involve an exit out of Seller's country of incorporation, Seller shall Deliver the Products/Parts to Buyer FCA Seller's facility, place of manufacturer or warehouse; (ii) for shipments within the European customs territory, Seller shall Deliver CPT - carriage paid to named place of destination; (iii) for other export shipments out of Seller's country of incorporation, Seller shall Deliver Products/ Parts to Buyer FOB, in case of transportation by sea (specifying the port of export); FCA loaded into aircraft, in case of transportation by air (specifying the airport of export); or CPT - carriage paid to named place of destination specified between the parties, in case of transportation by rail or road. The "Delivery Date" for any item of Products/Parts is defined as the date on which such item is Delivered in accordance with this Article. Partial Delivery and Delivery in advance of the Delivery schedule shall be permitted, unless otherwise specified in the Contract.

2.2 Subject to Article 2.3, title and risk of loss to Products and/or Parts shall pass upon Delivery as provided in Article 2.1, with the exception that title and risk of loss to: (i) Products and/or Parts shipped from the United States of America ("U.S.") shall pass from Seller to Buyer immediately after each item departs from the U.S. territorial land, seas and overlying airspace, which the parties acknowledge extend to twelve nautical miles from the baseline of the country, determined in accordance with the 1982 United Nations Convention of the Law of the Sea; and (ii) Products and/or Parts to be shipped to a Delivery destination directly from countries different from Seller's country of incorporation (drop shipment), shall pass immediately after each item departs from the territorial land, seas and overlying airspace of the sending country. For the avoidance of doubt, Seller or its relevant Group member shall retain title to any equipment leased to Buyer Group.

2.3 If any of the Products and/or Parts cannot be shipped to Buyer in accordance with the agreed upon Delivery terms due to any cause not attributable to Seller Group, upon notice to Buyer, Seller may store such Products and/or Parts or ship them to outside storage, in which cases: (i) any amounts otherwise payable to Seller upon Delivery or shipment shall become payable upon presentation of a certification specifying the cause and place of storage (any payment security shall allow payments upon presentation of notice to storage instead of transport documents); (ii) all expenses incurred by Seller Group, such as for preparation and placement into storage, handling, inspection, preservation, insurance, removal charges, interest, and any VAT or other taxes imposed directly or indirectly under Applicable Law shall be reimbursed or paid by Buyer upon submission of Seller's invoices; and (iii) when reasonably possible and upon payment of all amounts due hereunder, Seller shall resume Delivery of the Products and/or Parts to the originally agreed point of Delivery. Title and risk of loss to Products and/or Parts shall pass as provided in Article 2.2. , provided that Seller shall not have any obligation to store any item beyond 60 calendar days and if the storage period extends beyond 60 days, Seller shall be entitled to resume Delivery of the Products/Parts in accordance with Article

2.1 . The terms of Article 2.3 shall apply also in the event any Buyer equipment repaired at Seller Group's facilities cannot be shipped to or received by Buyer in accordance with the agreed upon terms, provided that, in the case of Buyer equipment to be repaired at Seller Group's facilities, Buyer shall retain title to, and risk of loss for, any such equipment at all times.

2.4. In the event of a delay in the Delivery of Products and/or Parts beyond the contractually agreed Delivery Date or a delay in the commencement of the performance of Services beyond the contractually agreed commencement date, if such Delivery/ commencement is not excused under the terms of the Contract, Seller Group shall be liable exclusively for the following liquidated damages, unless a different amount is set forth in the Contract: 0.5% of the price of the delayed item for each week of delay, or 0.1% of the price of the delayed Service for each day of delay, in all cases cumulatively up to a maximum amount of 5% of the overall portion of the Contract Price allocable to the delayed Services, Products or Parts. The parties agree that such liquidated damages are not a penalty and represent a fair and reasonable estimate of the damages Buyer Group may suffer as a result of delay. SAID LIQUIDATED DAMAGES SHALL CONSTITUTE THE SOLE AND EXCLUSIVE LIABILITY OF SELLER GROUP AND THE SOLE AND EXCLUSIVE REMEDY OF BUYER GROUP FOR DELAY. No liquidated damages are due unless Buyer has suffered direct economic harm.

3. EXCUSABLE DELAYS

3.1 Neither party shall be liable or considered in breach or default of its obligations to the extent performance of such obligations is delayed or prevented, directly or indirectly, due to causes beyond the impacted party's reasonable control, including but not limited to: (i) acts of God, acts or omissions of governmental authorities, fire, severe weather conditions, earthquake, strikes or other labor disturbances, flood, serious risk of kidnapping, war (declared or undeclared), armed conflict, acts or threats of terrorism, epidemics, civil unrest, riot, severe delay in transportation, severe car shortage, or inability to obtain necessary materials, components or services; (ii) in the case of Seller, acts or omissions of Buyer Group, including failure to timely provide Seller Group with access, information, tools, material, and approvals necessary to permit Seller Group to timely perform the required activities, and including, without limitation, unknown physical conditions at the Site of an unusual nature and differing materially from those ordinarily encountered and generally recognized as occurring in the work of the character provided for in the Contract. The affected party shall promptly notify the other party in the event of a delay under this Article. The Delivery or performance dates shall be extended for a period equal to the time lost by reason of such delay, plus such additional time as may be reasonably necessary to overcome the effect of such delay. If Seller is delayed by acts or omissions of Buyer Group, or by the prerequisite work of Buyer's other contractors, Seller shall also be entitled to an equitable price adjustment. Under no circumstances shall Buyer's payment obligation be deemed excusable under this Article.

3.2 If a delay excused by this Article 3 extends for more than 90 days and the parties have not agreed upon a revised basis for resuming work, including an equitable price adjustment, then either party (except where delay is caused by Buyer Group, in which event only Seller), upon 30 days written notice may terminate the Contract with respect to the unexecuted portion of the work. In the event of a delay under Article 3.1(ii), the terms of Article 10.2 shall apply in full. In the event of a delay under Article 3.1(i), Buyer shall pay Seller the pro-rated Contract Price for all work performed before the effective date of termination.

4. WARRANTY

4.1 Subject to the limitations set forth in the Contract, Seller warrants to Buyer that: (i) the Products and/or Parts shall be Delivered free from defects in material, workmanship and title; and (ii) the Services shall be performed in a competent and diligent manner in accordance with any mutually agreed specifications. Unless Seller expressly agrees otherwise in writing and except for Products/Parts provided by Seller's Affiliates, any Parts not manufactured by Seller (including incidental materials and consumables used in the Services) shall carry only the warranty provided by the original manufacturers, and Seller gives no warranty for such Parts.

4.2 Unless otherwise stated in the Contract, the warranty period ("Warranty Period") shall be as follows: (i) for each Product (excluding Parts), 12 months from Start-Up date, or 8,600 running hours, or 18 months from the date of Delivery, or from the date of notice that the Products are ready for shipment, if the Delivery cannot take place for reasons not attributable to Seller Group, or from the date of notice that the Products are put into storage under Article 2.3, whichever occurs first; (ii) for Services, one year after performance of the Service; (iii) for Parts, 18 months after Delivery or 12 months after installation, whichever occurs first; (v) for repaired, replaced, or re-performed Products, Parts, or Services, six months after repair/replacement or re-performance, provided that Seller Group's warranty obligations shall in all cases terminate and in no event extend beyond 24 months after Delivery or placement into storage of the original Products/Parts or performance of the initial Service. As used herein, "Start-Up" means the equipment start-up activities to be carried out by Buyer in connection with the Products not later than 30 days from Seller's written notification that the Products are ready for start-up.

4.3 If Products, Parts, or Services do not meet the above warranties during the applicable Warranty Period and Buyer informs Seller in writing within 15 days of discovery, Seller's sole and exclusive liability shall be to either re-perform the defective Services, or repair or replace the defective component of the Products/Parts, at Seller's option. If despite Seller's reasonable efforts, a non-conforming Product/Part cannot be repaired or replaced, or non-conforming Services cannot be re-performed, the parties will negotiate an equitable adjustment in price with respect to such Product, Parts, component, or Service. Seller Group shall not under any circumstances be liable for defects that arise or are discovered after expiration of the Warranty Period.

4.4 Seller shall not be liable for accessing, retrieving, removing, or decontaminating defective Products or Parts, or for reinstalling repaired or replacement Products/Parts, or for any costs, damages, or losses incurred in connection with any of the above operations. Seller shall be responsible to transport defective Products or Parts only to and from the original Delivery point.

Buyer shall be responsible for all customs formalities, costs and taxes connected with any export to Seller or import of goods sent back to Buyer.

4.5 Seller does not warrant the Products, Parts or any repaired or replacement item against: normal wear and tear, including that due to environment, excessive operation at peak capability, frequent starting, type of fuel, detrimental air inlet conditions or erosion, corrosion or material deposits from fluids, misuse, accident, modification, heating, machining, bending, welding, alteration of any kind, or operation under conditions more severe than, or otherwise exceeding those set forth in, the specifications for the relevant Product or Part. The warranties and remedies set forth herein are further conditioned upon: (i) proper storage, installation, use, operation, and maintenance of the Products/Parts, and conformance with the operation instruction and installation manuals (including revisions thereto) provided by Seller Group; (ii) Buyer keeping accurate and complete records of operation and maintenance during the Warranty Period and providing Seller access to those records; and (iii) repair or modification pursuant to Seller's instructions and approval. Failure to meet any such conditions in Article 4.5 renders the warranty null and void.

4.6 THE REMEDIES SET FORTH IN ARTICLE 4 CONSTITUTE THE SOLE AND EXCLUSIVE REMEDIES FOR ALL

CLAIMS ARISING OUT OF OR RELATING TO ANY FAILURE OF, OR ANY DEFECT OR NON-CONFORMITY IN, THE

PRODUCTS, PARTS, OR SERVICES, REGARDLESS OF WHEN THE FAILURE, DEFECT OR NON-CONFORMITY ARISES AND REGARDLESS OF CAUSE OR ACTION. THE WARRANTIES SET FORTH IN ARTICLE 4 ARE

EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES, CONDITIONS, AND GUARANTEES, WHETHER WRITTEN, ORAL, IMPLIED, OR STATUTORY. NO IMPLIED OR STATUTORY WARRANTY OR CONDITION OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE SHALL APPLY.

Attachment 2

4.7 All Parts Delivered shall conform to Seller's part or version number specified in the Contract, or its equivalent or the superseding number subsequently assigned by Seller. If the number ordered is no longer available, Seller is authorized to provide a valid interchangeable Part without notice to Buyer.

5. INSPECTION AND FACTORY TESTS - The quality control exercised by Seller in its manufacture of Products/Parts shall be in accordance with Seller's normal quality control policies, procedures and practices. Unless otherwise expressly agreed in the Contract, Seller shall attempt to accommodate Buyer's requests to witness Seller's factory tests of Products/Parts, but only if such witnessing can be arranged without delaying the work. Access to Seller Group's premises shall be limited to areas directly concerned with the Products/Parts, excluding in all cases areas where work of a proprietary nature is conducted.

6. CHANGES - Each party may at any time propose changes in the schedule or scope of Parts, Products or Services in the form of a draft change order. Neither party is obligated to proceed with the changed schedule or scope until both parties agree to such change in writing. Unless otherwise agreed by the parties, pricing for additional work arising from such changes shall be at time and material rates.

7. PAYMENT

7.1 Buyer shall pay to Seller all invoiced amounts Net 30 days when due or in a timely manner according to the Contract. If nothing is agreed in the Contract, payment shall be made in US dollars or the currency set forth in the Seller’s proposal. Seller reserves the right to require Payment Milestones or require one or more irrevocable, unconditional, letters of credit payable at sight (“Payment Security”), without any set-off,and in the currency agreed in the Contract(or on the face of the purchase order). In the event Buyer requests payment by credit card, Seller at its option may add a 3% surcharge to the applicable Contract Price for processing fees associated with credit card transactions.

7.2 In addition to other Contract remedies, Buyer shall pay interest to Seller at the rate of 1.5% per month (or fraction thereof), not to exceed the lesser of 18% per annum or the maximum amount permitted by Applicable Law, on all amounts not timely paid in accordance with the Contract.

7.3 If applicable, each Payment Security shall be irrevocable and unconditional, and allow for pro-rata payments for partial Deliveries, other charges (e.g., storage, export shipments, cancellations, and adjustments), and all other payments due to Seller under the Contract. Each Payment Security shall be: (i) issued or confirmed by a primary international bank that is reasonably acceptable to Seller; (ii) payable at the counters of such bank; (iii) opened 30 days from the Contract effective date; and (iv) remain in effect until the latest of 90 days after the latest scheduled Products/Parts shipment, or completion of Services, or receipt by Seller of final payment. Buyer shall make relevant adjustments in the Payment Security (including increasing amounts or validity period, and including in accordance with the changes agreed in the Contract) as required to fulfill its payment obligations under the Contract, within 15 business days of Seller's notification that such adjustment is necessary. Seller will not have an obligation to begin performance until the Payment Security, or the required adjustment thereof, has become operative.

8. TAXES AND DUTIES

8.1 Seller shall be responsible for and shall pay when due and payable all Seller Taxes, and Buyer shall be responsible for and shall pay all Buyer Taxes. The Contract Price does not include any Buyer Taxes. Therefore, if any such taxes are applicable, they will be added to the Contract Price. For U.S. sales and use tax, and in other jurisdictions where applicable, Buyer may report/remit sales or similar taxes directly if Buyer timely provides a direct pay or exemption certificate to Seller.

8.2. If the Applicable Laws require the Contract to be subject to stamp duty, fee, or registration, Buyer shall be responsible for the required formalities and bear the related costs. Buyer shall return to Seller a copy of the registration certificate or a registered copy of the Contract within 10 days from the due date required by said Applicable Laws to register or pay for such stamp duty, fee, or registration. According to the Applicable Laws of the country in which Buyer has requested Seller to provide Services, Seller may be required to be registered locally, in which case, Seller shall perform the Services and invoice for them with the intervention of its relevant branch or permanent establishment.

8.3 If Buyer is required to deduct or withhold any Seller Taxes from the Contract Price, Buyer shall (1) give at least 30 days' notice to Seller that Buyer will withhold, (2) make all reasonable efforts to minimize any withholding tax from payments to Seller, in accordance with Applicable Laws and any applicable bilateral conventions against double taxation, and (3) provide to Seller, within 30 days from payment, the official receipt issued by the competent government authority to which the Seller Taxes have been paid, or an alternative document acceptable to the relevant tax authorities. . If Buyer requires tax residence certificates or other documentation from Seller to apply for any exempted or reduced tax regime, Seller shall submit the appropriate certificates upon Buyer's written request. If Buyer, under the Applicable Laws of any country other than Seller's country of incorporation or in which Seller has a branch, deducts or withholds Seller Taxes or fails to comply with the requirements of this clause, Buyer shall pay additional amounts to Seller so that Seller receives the full amount of the Contract Price, as though no such Seller Taxes had been deducted or withheld.

8.4 If Buyer benefits from any tax, fee or duty exemption which is applicable to Seller or Seller's Group, Buyer agrees to provide Seller, without charge and before the following as applicable: (1) entering into the Contract, (2) before invoicing, or (3) before any other relevant event, documentation acceptable to the competent tax authorities supporting the exemption, together with instructions on the exemption procedure. Buyer shall promptly inform Seller in writing about the revocation, expiry or other change of the exemption. If Seller is denied the exemption because of a failure of Buyer, Seller shall be entitled to invoice and Buyer shall pay promptly the applicable tax, fee or duty.

8.5 When Buyer arranges the export or intra-European Union ("EU") community shipment, Buyer will provide to Seller, free of charge and within 90 days (or, in the case of exports from the U.S., 30 days), evidence (obtained from Buyer's forwarder) of exportation or intra EU community shipment; such evidence must be in a form that is acceptable to the competent tax and customs authorities. Failing the above, Seller shall be entitled to invoice Buyer the applicable VAT, U.S. sales and use tax, or similar taxes.

9. ASSIGNMENT, NOVATION & SUBCONTRACTING - Buyer may assign or novate the Contract, in full or in part and including through change of ownership, only with the prior consent of Seller, which consent shall not be unreasonably delayed or withheld, provided that Seller shall be entitled to withhold such consent only for demonstrable reasons if the assignee/novatee lacks adequate financial capability, is a competitor or potential competitor of Seller or its Affiliates, causes Seller Group to be in breach of Applicable Law, and/or does not meet Seller's code of ethics. Seller may assign or novate to third parties the Contract, in full or in part, only with the prior consent of Buyer, which consent shall not be unreasonably delayed or withheld, provided that Seller may, without Buyer's consent: (i) assign or novate the Contract, in full or in part, to one or more Affiliates of Seller; and (ii) assign any receivables due hereunder to one or more Affiliates of Seller. The parties agree to execute such documents as may be necessary to effect the permitted assignments or novations. In the event of a novation or assignment by Buyer, Buyer shall cause the novatee/assignee to provide additional payment security at Seller's reasonable request. Any assignment or novation in violation of the above shall be void and without effect for the other party. Nothing herein shall restrict Seller from subcontracting portions of its work, provided that Seller remains responsible to Buyer for performance of such work.

10. TERMINATION AND SUSPENSION

10.1 Either party may terminate this Contract for default if: (i) any proceeding is brought against the other party, voluntarily or involuntarily, under applicable bankruptcy or insolvency laws, or if the other party is unable to pay its debts when due, to the extent permitted by Applicable Law; or (ii) the other party commits a material breach of this Contract, which does not otherwise have a specified contractual remedy, and fails to cure the breach within 30 days of notice from the non-breaching party, or if it is not possible to cure such breach within 30 days, fails to commence to cure the breach within 30 days of such notice or fails to thereafter continue diligent efforts to complete the cure as soon as reasonably possible. In the event of a termination by Buyer under this Article 10.1, Seller shall reimburse Buyer the difference between that portion of the Contract Price allocable to the terminated scope and the actual amounts reasonably incurred by Buyer to complete such terminated scope; and Buyer shall pay to Seller the portion of the Contract Price allocable to Products/Parts purchased and/or completed, and amounts for Services performed, before the effective date of termination. Said amounts shall be calculated using the applicable Contract rates, or in the absence of such rates, at Seller's then-current standard time and material rates. In the event there are agreed-upon Contract milestones, said amounts shall be calculated in accordance with the milestone schedule for completed milestones, and the Contract rates for work toward milestones not yet achieved.

10.2 Buyer may terminate the Contract (even in part) with a 20-day prior written notice for reasons other than those set forth in Article 10.1, in which case Buyer shall pay Seller's charges in accordance with the Contract termination schedule; or if no such schedule exists: (i) Buyer shall pay Seller all costs and expenses incurred by Seller in connection with work performed before the effective date of termination, plus a reasonable margin percentage in relation to such costs and expenses, which margin percentage shall not be lower than the margin percentage applicable to the overall Contract; or (ii) for Contracts based on payment milestones Buyer shall pay Seller: (a) all amounts due under the Contract for completed milestones, plus (b) all costs and expenses incurred by Seller in connection with work performed in relation to incomplete milestones, plus a reasonable margin percentage in relation to such costs and expenses, which margin percentage shall not be lower than the margin percentage applicable to the overall Contract. In connection with both (i) and (ii), Buyer shall also pay Seller the costs and expenses incurred by Seller as a direct result of the termination, including the costs associated with vendor disputes or Claims.

10.3 If Buyer fails to pay any outstanding undisputed invoice as set forth in the Contract, or fails to issue the Payment Security within the time agreed, Seller, upon a 15-day notice to Buyer, may suspend performance and Delivery. Any cost incurred by Seller as a result of such suspension (including storage, stand-by costs, demobilization and re-mobilization costs) shall be payable by Buyer upon submission of Seller's invoices. Performance of Seller's obligations shall be extended for a period equaling the period of Buyer's failure to meet its payment obligations, plus such additional time as may be reasonably necessary to overcome the effect of such payment delay. If suspension for Buyer’s failure to pay an undisputed invoice or failure to issue thePayment Security exceeds 15 days, Seller may at is sole option immediately terminate the applicable Contract for cause and Buyer shall also pay Seller the costs and expenses incurred by Seller as a direct result of the termination, including the costs associated with vendor disputes or Claims, plus a reasonable margin percentage in relation to such costs and expenses.

10.4 With a 20-day written prior notice, Buyer may elect to suspend performance of the Contract for a maximum cumulative period of 90 days, after which Seller may terminate the Contract and Article 10.2 shall apply. In the event of suspension under this Article 10.4, Buyer shall also pay all reasonable expenses incurred by Seller in connection with the suspension, including without limitation, expenses for repossession, fee collection, stand-by costs, demobilization/remobilization, and costs of storage. The schedule for Seller's obligations shall be extended for a period of time reasonably necessary to overcome the effects of such suspension.

11. COMPLIANCE WITH LAWS, CODES AND STANDARDS

11.1 The Contract Price is based on Seller Group's design, manufacture, testing, and Delivery of the Products, Parts and Services pursuant to: (i) its design criteria, manufacturing processes, and procedures and quality assurance program; (ii) those portions of industry specifications, codes, and standards in effect as of the date of entering into the Contract as are specified in the Contract; (iii) Applicable Law; and (iv) any mutually agreed-upon written terms and specifications set forth in the Contract.

11.2 Notwithstanding any other provision of this Contract, the parties shall at all times comply with Applicable Law in the performance of the Contract, except for Seller to the extent that such compliance is penalized under, or otherwise violates, the laws of the United States or any European Union laws.

11.3 Seller is entitled to an equitable adjustment to the Contract Price and the Delivery schedule to reflect any additional costs and other impact incurred by Seller Group as a result of a change in Applicable Law or applicable standards and regulations, including changes in the interpretation thereof, after entering into the Contract. In the event any such change prevents Seller Group from executing its obligations without breaching Applicable Law or makes Seller's execution of its ob ligations unreasonably burdensome or unbalanced, Seller shall also have the right to withdraw its Proposal or terminate the Contract without any liability.

11.4 Unless otherwise agreed in the Contract, Seller shall be responsible for timely obtaining the permits, licenses, and authorizations required for Seller Group to meet the requirements of the Contract, except that Buyer shall be responsible for timely obtaining any required permits, licenses, and authorizations that can only be obtained by Buyer Group. Buyer and Seller shall provide each other reasonable assistance in obtaining the required authorizations.

11.5. Buyer agrees that it will not sell, distribute, disclose, release or otherwise transfer any item or technical data provided under this Contract to: (i) any country designated as a "State Sponsor of Terrorism" by the U.S. Department of State including, for this Agreement, the countries of Cuba and North Korea (ii) any entity located in, or owned by an entity located in, a "State Sponsor of Terrorism" country or Cuba or North Korea, (iii) the region of Crimea or (iv) any person or entity listed on the "Entity List" or "Denied Persons List" maintained by the U.S. Department of Commerce, the list of "Specifically Designated Nationals and Blocked Persons" maintained by the U.S. Department of Treasury or any other applicable prohibited party list of the US Government. This clause will apply regardless of the legality of such a transaction under local law. Except as otherwise agreed in writing between the parties, each Party shall be responsible for obtaining and maintaining any authorization required for its performance under this Contract (including the transfer any item or technical data under this Contract), such as export license, import license, exchange permit or other required government export or import authorization. Each Party shall provide the reasonable assistance necessary for the other Party to secure and comply with such authorizations as may be required. Neither Party shall be liable if any government export authorization is delayed, denied, revoked, restricted or not renewed despite reasonable efforts by the Party. Additionally, such delay, denial, revocation or non-renewal shall not constitute a breach of this Agreement.

Buyer shall not use any items sold hereunder for any military application, or resell them for such purpose.

12. ENVIRONMENT, HEALTH, SAFETY AND SECURITY (EHSS)

12.1 Buyer shall take all actions necessary to provide a safe, healthy and secure work environment, including transportation and accommodation if applicable, for Seller Group personnel. Buyer shall inform Seller of any known risks, hazards, or changed conditions impacting worker health, safety or the environment, including the presence or potential presence of Hazardous Materials, and shall provide relevant information, including safety data sheets, site security plans, risk assessments and job hazard analyses.

12.2 To evaluate risks associated with the provision of Services and performance under this Article, Buyer shall provide Seller Group with reasonable access to review the Site and related equipment. If Seller's work at the Site is subject to local, state or national EHS legal requirements that are not reasonably available, Buyer shall notify and provide copies of same to Seller.

12.3 If Seller or Seller's representative believes in good faith that Site conditions, Seller transportation or accommodation provisions, or the actions of others threaten the health, safety, or security of Seller Group personnel or the environment, Seller or its representatives may, in addition to other rights or remedies available, STOP WORK, evacuate some or all of its personnel, suspend performance of all or any part of the Contract, and/or remotely perform or supervise work. If Seller exercises its rights under this provision, it shall give prompt notice to Buyer, and the parties shall work cooperatively to correct the conditions or actions prompting the STOP WORK. The parties agree there shall be no retaliation taken against any person who invokes their right under this provision to STOP WORK. Any delay resulting from Seller Group's exercise of its rights under this Article shall constitute an excusable delay.

12.4 To the full extent permitted by Applicable Law, Buyer agrees that it is the generator, and shall be solely responsible for the storage, transportation and disposal of all Hazardous Materials or waste related to or arising from the performance of Services at Buyer Group sites, including any removed from Seller's equipment. Prior to the transportation and disposal of waste materials by Buyer, Seller shall properly handle and manage all Hazardous Materials resulting from the Services in accordance with Applicable Law and Buyer's written requirements. If Seller Group encounters any Hazardous Materials, it may suspend work pending Buyer elimination of the hazardous condition. If any Seller equipment or Buyer equipment destined for a Seller facility is contaminated with Hazardous Materials, Buyer shall assume sole responsibility for decontaminating such equipment and returning it in the same condition received to allow for its safe handling and transportation in compliance with Applicable Law. If any such Hazardous Materials cause an increase in Seller's cost or time, Seller shall be entitled to an equitable adjustment in price and schedule.

13. ADDITIONAL EHSS PROVISIONS APPLICABLE TO SERVICES

13.1 Seller Group personnel shall not be required to work in excess of any time restriction prescribed by Applicable Law. Seller Group personnel will have at least one day of rest in any seven consecutive days; provided, the parties may agree upon exceptions consistent with Seller's working time policy.

13.2 Buyer shall provide medical care and facilities at the Site consistent with international industry standards. If Seller Group's personnel require urgent medical attention, Buyer shall make its medical facilities available to such persons as necessary. To the Attachment 2

extent Buyer cannot supply necessary urgent medical attention at the Site or any Buyer Group's site or while working offshore, Buyer shall provide for transport of Seller Group's personnel and access of such personnel to the nearest suitable urgent care facility. For offshore or remote work, Buyer shall be responsible for the medical evacuation of Seller Group's personnel from the Site to the departure point on the mainland or Buyer's designated medical services provider.

13.3 Buyer shall transport Seller Group's personnel, equipment and materials, including medi-vac, to and from all offshore locations and to such other job Sites as agreed, in compliance with Applicable Law and international industry standards regarding qualified personnel and safe operation and maintenance. Buyer Group agrees to make such equipment and information relating to its operation and maintenance available to Seller for review. Buyer shall provide personal protective equipment required during use of Buyer provided transportation to and from the offshore work and such other specialized equipment as agreed between the parties.

13.4 Buyer shall provide, at no cost to Seller, accommodation and messing for Seller Group's personnel, which offers a reasonable degree of comfort, is consistent with international industry standards and is at least comparable to that furnished to Buyer's management and technical personnel. Buyer shall provide telephone and computer internet connectivity to Seller Group's personnel at said accommodations.

14. CONFIDENTIALITY

14.1 "Confidential Information" means pricing for Parts, Products, and Services, and/or information that is designated in writing as "confidential" or "proprietary" at the time of disclosure, or orally designated as "confidential" or "proprietary" and confirmed in writing within ten days after oral disclosure. Confidential Information shall not include information that: (i) is or becomes generally available to the public other than from disclosure by the receiving party's Group; (ii) is or becomes available to the receiving party's Group on a non-confidential basis from a source other than the disclosing party and, after due inquiry, that source is not subject to a confidentiality obligation to the disclosing party; or (iii) is independently developed by the receiving party's Group without reference to the disclosing party's Confidential Information, as evidenced by written documents.

14.2 The parties shall: (i) use, reproduce, or disclose the other party's Confidential Information only in connection with the Contract and permitted use(s) and maintenance of Products, Parts and Services; (ii) take reasonable measures to protect the confidentiality, and prevent disclosure and unauthorized use of the Confidential Information and (iii) in particular, not disclose Confidential Information to the other party's competitors.

14.3 A party may disclose Confidential Information: (i) to any member of its Group who has a need to know to perform the Contract or use and maintain Products, Parts, or Services and who is bound in writing to confidentiality obligations and use restrictions at least as restrictive as in this Contract; and (ii) to comply with a legal obligation, but only after promptly notifying the disclosing party of its disclosure obligation so that the disclosing party may seek an appropriate protective order. Buyer shall not disclose Confidential Information to Seller unless required for Seller to perform under this Contract. Buyer warrants that it has the right to disclose the information and shall Indemnify Seller Group from any Claims or damages resulting from improper disclosure.

14.4 Neither party shall make any public announcement about any aspect of the Contract or related documents or information without prior written approval of the other party.

14.5 The confidentiality and use restrictions of this Article 14 shall survive any termination of the Contract for ten years. Each party shall Indemnify the other for failure to comply with this provision.

15. INTELLECTUAL PROPERTY

15.1 Seller shall Indemnify Buyer from any rightful Claims of third parties that the Products or Parts manufactured by Seller or its Affiliates infringe any utility patent of the U.S., EU, or the country of initial installation (if set forth in the Contract), provided that: (i) Buyer promptly notifies Seller in writing of any such claim; (ii) Buyer makes no admission of liability and does not take any position adverse to Seller regarding such claim and gives Seller authority, at Seller's expense, to direct and control all defense, settlement and compromise negotiations; and (iii) Buyer provides Seller with full disclosure and assistance that may be reasonably required to defend any such claim.

15.2 Seller shall have no obligation or liability with respect to any claim based upon: (i) any Products, Parts or Services that have been altered, modified, or revised; (ii) the combination, operation, or use of any Products, Parts or Services with other products or services when such combination is part of any allegedly infringing subject matter; (iii) failure of Buyer Group to implement any update provided by Seller Group that would have prevented the claim; (iv) unauthorized use of Products, Parts or Services, including without limitation a breach of the provisions of the Contract; or (v) Products, Parts or Services made or performed to Buyer Group's specifications.

15.3 Should any Products, Parts or Services become the subject of a claim, Seller may at its option: (i) procure for Buyer the right to continue using the Product, Part or Service, or portion thereof; (ii) modify or replace it in whole or in part to make it noninfringing; or (iii) failing (i) or (ii), take back Products or Parts, discontinue Services, and refund any fees received by Seller attributable to the infringing Product, Part or Service.

15.4 THE FOREGOING STATES SELLER GROUP'S ENTIRE AND EXCLUSIVE LIABILITY FOR ANY INTELLECTUAL AND INDUSTRIAL PROPERTY RIGHTS INFRINGEMENT.

15.5 Each party shall retain ownership of all Confidential Information and intellectual property it had prior to the negotiations of the Contract. Any and all new intellectual property conceived, created or provided by Seller Group under the Contract, whether alone or with any contribution from Buyer Group, shall be owned exclusively by Seller or other members of Seller Group, as the case may be. To the extent that Buyer Group may acquire any right or interest in such new intellectual property, Buyer irrevocably assigns, and agrees to assign and/or cause other members of Buyer Group to assign, all such rights and interests in such new intellectual property as instructed by Seller, and to execute assignments and other documentation as necessary to achieve this result. To the extent permissible by law, Buyer Group waives any moral rights it acquires in any such new intellectual property.

Seller shall grant Buyer use rights to utilize Seller's intellectual property embedded in the Products or Parts solely for standard use, operation, and maintenance of the Products/Parts by Buyer. Such license shall not give Buyer the right to manufacture and/or have manufactured such Products/Parts to the extent such maintenance will result in substantially new Products/Parts.

15.6 If Seller provides any Products that are software, including SaaS (Software as a Service), embedded software, or software that is installed on Buyer Group's equipment, the terms of the annexed Software License Addendum, shall apply. If there is any conflict between these Terms and Conditions and the terms of the Software License Addendum, the terms of the Software License Addendum shall prevail.

15.7 Buyer agrees that Seller may create, receive, maintain, transmit and otherwise have access to machine, technical, system, usage and related information, including, but not limited to, information about Buyer's products, services, systems and software, that is gathered periodically to facilitate the provision of Products, Parts, Services, other support, consulting, training and other services to Buyer (if any), and to verify compliance with the terms of this Contract. Seller and its Affiliates may use such information to provide, develop or improve their products or services.

16. INDEMNITY, LIMITATION OF LIABILITY, AND INSURANCE The provisions of Article 16 shall apply to the maximum extent permitted by Applicable Law and, unless otherwise expressly stated, prevail over any conflicting clauses.

16.1 (i) Seller agrees to Indemnify Buyer Group from and against any and all Claims for bodily injury, illness, or death suffered by any Seller Group's personnel, and/or for damage to or loss of any property of any Seller Group member (whether owned, hired, or leased, but excluding property leased to Buyer Group) arising out of or in connection with the Contract, REGARDLESS OF CAUSE OR ACTION. (ii) Buyer agrees to Indemnify Seller Group from and against any and all Claims for bodily injury, illness, or death suffered by any Buyer Group's personnel, and/or for damage to or loss of any property of any Buyer Group member (whether owned, hired, or leased, and including the Products and Parts (after Delivery), the Site, and any facilities or property thereon), arising out of or in connection with the Contract, REGARDLESS OF CAUSE OR ACTION.

16.2(i) Seller agrees to Indemnify Buyer Group from and against any rightful Claims of third parties on account of bodily injury, illness or death, or damage to or loss of property, to the extent resulting directly from the negligence of Seller Group in connection with performance of the activities under this Contract. (ii) Buyer agrees to Indemnify Seller Group from and against any rightful Claims of third parties on account of bodily injury, illness or death, or damage to or loss of property, to the extent resulting directly from the negligence of Buyer Group in connection with the activities performed under this Contract. (iii) In the event the injury or damage to third parties is caused by the joint or concurrent negligence of the parties or their respective Groups, each party shall bear such injury or damage proportionally to its Group's negligence. For the avoidance of doubt, no members of either party's Group shall be considered third parties and, for purposes of Seller's indemnity obligation in Article 16.2(i), no part of the Site or any property or facilities thereon shall be considered as third party property, and the Site owner and its partners, affiliates and contractors/subcontractors shall not be considered third parties. The reciprocal indemnities in this Article 16.2 shall apply only if the indemnified party: (i) promptly notifies the other in writing of the third party claim; (ii) makes no admission of liability, does not take any position adverse to the other party and gives such other party's authority to direct and control all defense, settlement and compromise negotiations; and (iii) provides the other party with full disclosure and assistance as may be reasonably required to defend such claim.

16.3 Except only as provided in Article 16.1(i) but notwithstanding anything else to the contrary herein, in the event the Site is offshore, Buyer assumes sole responsibility for and shall Indemnify the Seller Group (to the maximum extent permitted under applicable law) from and against any and all Claims asserted by or in favor of any person or party resulting from pollution, contamination or blow-out of any kind and including costs of pollution control, removal, spills, leakage, and clean-up. The above indemnity applies REGARDLESS OF CAUSE OR ACTION and even if the claim is on account of any defect in the Products, Parts or Services; but it shall not apply to surface pollution or spillage of fuels, lubricants, sewage or garbage to the extent such surface pollution or spillage originates from Seller Group's property while such property is in Seller Group's sole care, custody and control.

16.4 EXCEPT ONLY FOR SELLER'S OBLIGATIONS IN ARTICLES 8.1, 15, 16.1(i), AND 11.2 (TO THE EXTENT OF

FINES AND PENALTIES IMPOSED BY A GOVERNMENT AUTHORITY AS A RESULT OF SELLER'S VIOLATION OF

APPLICABLE LAW), SELLER GROUP'S TOTAL LIABILITY FOR ANY AND ALL CLAIMS OF ANY KIND,

REGARDLESS OF CAUSE OR ACTION, ARISING OUT OF OR RELATED TO THE CONTRACT, OR ITS

PERFORMANCE OR BREACH, INCLUDING WITHOUT LIMITATION WARRANTY AND TERMINATION, SHALL NOT UNDER ANY CIRCUMSTANCES EXCEED: (I) IN THE CASE OF CLAIMS RESULTING FROM THE PROVISION OR

FAILURE TO PROVIDE, OR FROM THE USE OR FAILURE TO USE PRODUCTS OR PARTS, THE CONTRACT PRICE ALLOCABLE TO THE PRODUCT AND/OR PARTS GIVING RISE TO THE CLAIM; AND (II) IN THE CASE OF CLAIMS

RESULTING FROM THE PROVISION OR FAILURE TO PROVIDE SERVICES, THE CONTRACT PRICE ALLOCABLE TO THE SERVICES GIVING RISE TO THE CLAIM. SELLER GROUP SHALL HAVE NO LIABILITY FOR ADVICE OR

ASSISTANCE GRATUITOUSLY PROVIDED BY SELLER GROUP BUT NOT REQUIRED PURSUANT TO THE CONTRACT. ALL SELLER GROUP'S LIABILITIES SHALL TERMINATE AT THE END OF THE RELEVANT

WARRANTY PERIOD, EXCEPT FOR CLAIMS THAT HAVE BEEN TIMELY COMMENCED BY BUYER IN ACCORDANCE WITH THE CONTRACT.

16.5 UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL LOSS. NOTWITHSTANDING ANYTHING TO THE CONTRARY, AND EXCEPT ONLY TO THE

EXTENT OF AGREED LIQUIDATED DAMAGES AND ANY PREDETERMINED TERMINATION FEES DUE TO SELLER

UNDER THE CONTRACT, SELLER SHALL INDEMNIFY BUYER GROUP FROM AND AGAINST ANY AND ALL DIRECT OR INDIRECT CLAIMS FOR CONSEQUENTIAL LOSS OF SELLER GROUP; AND BUYER SHALLINDEMNIFY

SELLER GROUP FROM AND AGAINST ANY AND ALL DIRECT OR INDIRECT CLAIMS FOR CONSEQUENTIAL LOSS OF BUYER GROUP REGARDLESS OF CAUSE OR ACTION.

16.6 NOTWITHSTANDING ARTICLE 16.2(i), IN THE EVENT BUYER GROUP PROVIDES PRODUCTS OR PARTS TO A

THIRD PARTY OR USES SELLER'S PRODUCTS/PARTS AT A FACILITY NOT OWNED BY BUYER, OR THE

SERVICES ARE PERFORMED AT A FACILITY NOT OWNED BY BUYER, BUYER SHALL INDEMNIFY SELLER

GROUP FOR AND AGAINST ANY LIABILITY ARISING OUT OF CLAIMS MADE IN EXCESS OF THE LIMITATIONS AND EXCLUSIONS SET FORTH IN THE CONTRACT, REGARDLESS OF CAUSE OR ACTION. IN THE EVENT BUYER

ASSIGNS OR NOVATES THE CONTRACT, IN WHOLE OR IN PART, SUCH ASSIGNEE OR NOVATEE SHALL BE

BOUND BY THE SAME TERMS OF THIS CONTRACT, AND BUYER HEREBY WAIVES ANY RIGHT TO CLAIM,

WHETHER IN TORT, AT LAW OR OTHERWISE, FOR DAMAGES OR LIABILITIES OF ANY KIND IN EXCESS OF THE LIMITATIONS AND EXCLUSIONS SET FORTH IN THE CONTRACT.

16.7 Buyer and Seller each covenant and agree to support their mutual indemnity obligations under Article 16 by procuring and maintaining, at the indemnifying party's sole expense, insurance policies meeting the following requirements: (i) Workers Compensation/Employer's Liability as per Applicable Law; (ii) Comprehensive General Liability: Combined Single Limits for Bodily Injury and Property Damage $1,000,000 (one million) per occurrence and $2,000,000 (two million) in the aggregate (or its equivalent in another relevant currency), which may be satisfied through a combination of underlying and excess coverages. The parties agree that, to the extent of the indemnifying party's liability and indemnity obligations under this Contract, the indemnifying party's General Liability policies shall include the indemnified party Group as additional insured<(>,,<)> contain blanket contractual liability coverage, be primary, and receive no contribution from any insurance policies maintained by or on behalf of the indemnified party. Each party, on request, shall provide to the other party insurance certificates evidencing the aforementioned limits and terms of insurance. Buyer and Seller shall each arrange for any of their respective insurance policies hereunder to contain provisions whereby, to the extent of each party's liability and indemnity obligations under this Contract, their insurers waive their rights of subrogation against the other party's Group, as well as the other party's respective insurers.

17. NO NUCLEAR USE - The Products, Parts and/or Services are not intended or authorized for use in connection with any nuclear facility or activity, and Buyer warrants that it shall not use, or permit others to use, Products, Parts and/or Services in connection with or for any such purposes without the advance written consent of Seller. If, in breach of the foregoing, any such use occurs, Seller hereby disclaims any and all liability for any nuclear or other damage, injury, or contamination REGARDLESS OF CAUSE OR ACTION. In addition to any other rights of Seller and to the maximum extent permitted under Applicable Law, Buyer assumes sole responsibility for, and shall Indemnify Seller Group from and against, any and all Claims asserted by or in favor of any person or party resulting from any nuclear or other damage, injury, or contamination REGARDLESS OF CAUSE OR ACTION. Consent of Seller to any use in connection with any nuclear facility or activity, if any, will be conditioned upon additional terms and conditions that Seller determines to be acceptable for protection against nuclear liability.

18. ADDENDA - If any Products/Parts include executable binary code, or if Seller provides any remote diagnostic, rental tools, training, or other special Services, the terms of the respective annexed Cybersecurity Services Addendum, Remote Diagnostic Services Addendum, Rental Tools Addendum, Training Addendum and/or other addendum shall apply. If there is any conflict between these Terms and Conditions and the terms of any applicable addendum, the terms of the applicable addendum shall prevail.

19. GOVERNING LAW - This Contract shall be governed by and construed in accordance with the laws of (i) the State of New York, if Seller is incorporated in the U.S.; or (ii) England and Wales, if Seller is incorporated outside the U.S., excluding in any case conflict of law rules.

20. DISPUTE RESOLUTION - Any dispute arising out of or in connection with this Contract shall be referred to settlement proceedings under the International Chamber of Commerce (ICC) Mediation Rules, without prejudice to either party's right to seek emergency, injunctive, or conservatory measures of protection at any time. If any such dispute has not been settled within 60 days following the filing of a Request for Mediation (or such other period of time as may be reasonable under the circumstances or agreed in writing), the dispute shall be finally settled in accordance with the ICC Rules of Arbitration by one or more arbitrators appointed under the said Rules. The seat, or legal place, of arbitration shall be (i) Houston, Texas USA.

21. GENERAL CLAUSES

21.1 Except as otherwise expressly provided with regard to the members of each party's Group, none of the terms herein are intended to be enforced by third parties under the United Kingdom Contracts (Rights of Third Parties) Act (1999), where applicable. Buyer and Seller shall be entitled to modify, vary, amend and/or extinguish such rights without the consent of any third parties or member of either party's Group.

21.2 This Contract represents the entire agreement between the parties and no modification, amendment, rescission, waiver or other change shall be binding on either party unless agreed to in writing by their authorized representatives. Each party agrees that it has not relied on, or been induced by, any representations of the other party not contained in the Contract.

21.3 The invalidity in whole or in part of any part of this Contract shall not affect the validity of the remainder of the Contract. In Attachment 2

Cooper Machinery Services is an equal opportunity employer and gives all qualified applicants consideration of employment without regard to race, color, religion, age, sex, sexual orientation, gender identity,genetic information, national origin, disability status, protected veteran status, or any other characteristic protected by federal, state, or local laws. the event any provision of this Contract is held invalid or unenforceable, only the invalid or unenforceable part of the provision shall be severed, leaving intact and in full force and effect the remainder of the sentence, clause and provision to the extent not held invalid or unenforceable.

22. U.S. GOVERNMENT CONTRACTS

22.1 This Article 22 applies only if the Contract is for the direct or indirect sale to any agency of the U.S. government and/or is funded in whole or in part by any agency of the U.S. government. Buyer agrees that all Products, Parts and Services provided by Seller meet the definition of "commercial-off-the-shelf" ("COTS") or "commercial item" as those terms are defined in Federal Acquisition Regulation ("FAR") 2.101. To the extent the Buy American Act, Trade Agreements Act, or other domestic preference requirements are applicable to this Contract, the country of origin of Products/Parts is unknown unless otherwise specifically stated by Seller in this Contract. Buyer agrees any Services offered by Seller are exempt from the Service Contract Act of 1965 (FAR 52.222-41). The version of any applicable FAR clause listed in this Article 22 shall be the one in effect on the effective date of this Contract.

22.2 If Buyer is an agency of the U.S. government, then as permitted by FAR 12.302, Buyer agrees that all paragraphs of FAR

52.212-4 (except those listed in 12.302(b)) are replaced with these Terms and Conditions. Buyer further agrees the subparagraphs of FAR 52.212-5 apply only to the extent applicable for sale of COTS and/or commercial items and as appropriate for the Contract Price.

22.3 If Buyer is procuring the Products, Parts or Services as a contractor, or subcontractor at any tier, on behalf of any agency of the U.S. government, then Buyer agrees that FAR 52.212-5(e) or 52.244-6 (whichever is applicable) applies only to the extent applicable for sale of COTS and/or commercial items and as appropriate for the Contract Price. If the reasonableness of the price cannot be established through adequate price competition, or if cost or pricing data should be required for any other reason, or if a Product, Part or Service cannot be considered a "commercial item", Seller may terminate the Contract without penalty and be reimbursed for work done before the effective date of termination.

22.4 Seller reserves the right to reject any order from a Buyer listed on any denied party list.

COOPER MACHINERY SERVICES - TERMS & CONDITIONS FOR SALE OF PRODUCTS, PARTS & SERVICES February 1, 2022 COOPER MACHINERY SERVICES©
Attachment 2

Cooper Machinery Services
Cooper Machinery Services LLC
Deer Park Sales Off
1100 GEORGIA AVE
DEER PARK TX 77536-2522
USA
Phone 281-930-0060
Document number : US05/RU16/111128510

Date Issued : DEC 04 2023
Payment Terms ZN30-Net 30 Days From Date Of
Invce
Terms and conditions :As Attached/Included
Incoterms :FCA-Free Carrier
Free Carrier
Freight Terms :

QUOTATION
Sold to : 120967
City of Watsonville Water Resources
500 Clearwater Lane
Watsonville CA 95076-9556
USA
Ship to : 120967
City of Watsonville Water Resources
500 Clearwater Lane
WATSONVILLE CA 95076-9556
USA
Inside Sales Contact: Jason Music
Email: [email protected]
Outside Sales Contact AM : Mike Perez PH:562-818-2094
Email: [email protected]
Customer Reference : RFQ - EZ RAIL & COILS
Valid From : DEC 04 2023
Valid To : JAN 03 2024
Item Material Number Extended Weight Qty UM Unit Net Price Extended Price Description USD USD
000010 ZA080-593508-030A 0.000 kg 1 EA 1,728.57 1,728.57 8 CYL EZ RAIL
Lead Time : IN STOCK
000020 Z028-989-001 36.000 lb 9 EA 346.03 3,114.27

COIL IGNITION
Lead Time : IN STOCK
Price Summary :

Total Price : 4,842.84 USD
Inflation Surcharge : 96.86 USD
Same Day Shipment Charges: 0.00 USD
State Tax : 296.37 USD
County Tax : 61.75 USD
Transit Tax : 86.45 USD
Total Quotation Price : 5,384.27 USD
Attachment 3

Document number : US05/RU16/111128510
MINIMUM ORDER REQUIREMENTS: $200 Minimum for all Orders.

CREDIT TERMS: Credit Terms confirmed at time of order. Progress paymentsmay apply.

RETURN OF PRODUCTS AND ORDER CANCELLATION: Cooper Machinery Services shall accept returns of normally stocked Goods for a period of thirty (30) days following shipment for exchange or refund of the purchase price; provided, that Goods must be in their original cartons, unopened and unused and are subject to a return inspection. Appropriate restocking/ cancellation feesequal to the greater of (1) the cost incurred by Seller as a result of the cancellation, or (2) 25% of the purchase price. Non-stocked items(made to order) and Consumable type Goods such as gaskets, O-rings, nuts, bolts, wear parts, etc. are not returnable once shipped to the Buyer and no credits or refunds can be offered to the Buyer.

EXPORT COMPLIANCE: The items, technology, or software covered by this document may be subject to various laws including U.S. and foreign export controls. Cooper Machinery Services LLC is committed to compliance with all relevant export control laws. If the items, technology, or software are of U.S. origin or are being exported from the U.S. or will be re-exported, the following language applies: "These commodities, technology or software were exported from the United Statesof America in accordance with the Export Administration

Attachment 3

TERMS AND CONDITIONS

GENERAL TERMS & CONDITIONS FOR SALE OF PRODUCTS, PARTS AND/OR SERVICES NOTICE: Any purchase by Buyer of Products, Parts and/or Services from Seller is subject to these Terms and Conditions. Any additional or different terms proposed by Buyer are expressly objected to and shall not be binding upon Seller unless expressly accepted in writing by Seller's authorized representative. Any order for Products, Parts and/or Services shall constitute acceptance of these Terms and Conditions.

1. DEFINITIONS
"Affiliate" means with respect to either party an entity (including without limitation any individual, corporation, partnership, limited liability company, association, or trust) that directly or indirectly controls, is controlled by, or is under common control with, such party.
"Applicable Law" or "Applicable Laws" means any law, statute, order, decree, rule, injunction, license, permit, consent, approval, agreement, regulation, judgment or legislative or administrative action of a competent governmental authority, which applies to the sale of Products, Parts and/or provision of Services. "Buyer" means the entity purchasing Products, Parts and/or Services and its successors and permitted assigns. "Buyer Taxes" means all existing and future taxes, duties, fees, and other charges of any nature (including, but not limited to, ad valorem, consumption, excise, franchise, gross receipts, import, export, license, property, sales and use, stamp, storage, transfer, turnover, value-added taxes ("VAT"), or other similar taxes, and any and all items of deficiency, penalty, addition to tax, interest, or assessment related thereto), imposed or assessed by any governmental authority of any country in connection with the execution of this Contract or performance of or payment for work hereunder, but excluding Seller Taxes. "Claims" means all claims, demands, causes of action, liabilities, damages, judgments, fines, penalties, awards, losses, costs, and expenses (including, without limitation, attorneys' fees and costs of litigation) of any kind or character. "Consequential Loss" means, whether direct or indirect, and whether or not foreseeable at the time of entering into the Contract or at the time of commencing performance: any loss, delay or interruption of business, profits, revenue, production or opportunity; loss of product, use or equipment; standby time; rig, vessel, or other facility or equipment downtime; cost of capital; cost of substitute equipment, facilities, services or replacement power; overhead; any special, punitive, exemplary, incidental and/or consequential damages or losses; and/or Claims of a party's customers for any of the above losses, costs or damages. "Contract" means either the contract agreement signed by both parties or the purchase order signed by Buyer and expressly accepted by Seller in writing, together with these Terms and Conditions, any other documents incorporated by reference, Seller's Proposal, and any agreed scope of work for the sale of Products, Parts, and/or Services. "Contract Price" means the aggregate amount to be paid by Buyer to Seller for the purchase of Products, Parts and/or Services, as stated in the Contract, and any agreed adjustments to the same. "Delivery" means when the Products/Parts have been delivered according to the applicable Incoterm (2010). "Deliver" shall be construed accordingly.
"Group" means with respect to either party, such party (either Buyer or Seller, as applicable), as well as its Affiliates, and in connection with the project to which the Products, Parts and/or Services relate, its joint venture partners, joint interest owners, colessees, consortium members and/or other partners, and, in respect of Buyer only, the Site owner, end user, or Site operator; and for all of the above, also its and their contractors and subcontractors of any tier in connection with said project, as well as the shareholders, officers, directors, employees, invitees, agents, and consultants of all of the foregoing. "Buyer Group" and "Seller Group" shall be construed accordingly. Seller Group does not include any member of Buyer Group and Buyer Group does not include any member of Seller Group.
"Hazardous Materials" means any chemical, substance, material, waste or emission defined, classified or regulated as hazardous or toxic, or as a pollutant, contaminant, or threat or potential threat to human health, safety or the environment under Applicable Law, including but not limited to naturally occurring radioactive material, hydrocarbons, asbestos, lead, hydrogen sulphide or polychlorinated hydrocarbons, including biphenyls and biphenols. "Indemnify" means release, defend, indemnify, and hold harmless. "Parts" means the spare or repaired parts required in relation to the Product, identified by Seller in the Contract. "Products" means all equipment, materials, supplies, software, products, and other goods (excluding Parts) as applicable, sold under the Contract.
"Proposal" means Seller's formal offer to provide the Products, Parts and/or Services, and any mutually agreed written amendments thereto.
"REGARDLESS OF CAUSE OR ACTION" MEANS (TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW), REGARDLESS OF: CAUSE, FAULT, DEFAULT, NEGLIGENCE IN ANY FORM OR DEGREE, STRICT OR

ABSOLUTE LIABILITY, BREACH OF DUTY (STATUTORY OR OTHERWISE) OF ANY PERSON, INCLUDING OF THE

INDEMNIFIED PERSON, UNSEAWORTHINESS OF ANY VESSEL, AND/OR ANY DEFECT IN ANY PREMISES/ VESSEL; FOR ALL OF THE ABOVE, WHETHER PRE-EXISTING OR NOT AND WHETHER THE DAMAGES,

LIABILITIES, OR CLAIMS OF ANY KIND RESULT FROM CONTRACT, WARRANTY, INDEMNITY, TORT/ EXTRACONTRACTUAL OR STRICT LIABILITY, QUASI CONTRACT, LAW, OR OTHERWISE. “Seller” means Cooper Machinery Services, LLC or named Cooper Affiliate signing the Contract or the purchase order, and its successors and permitted assigns.
"Seller Taxes" means all corporate income taxes imposed on Seller and any taxes imposed on Seller's employees in connection with the execution of this Contract or the performance of or payment for work hereunder by Applicable Laws. "Services" means all the services, including, without limitation, technical assistance and guidance, training, repairs, and remote diagnostics, to be provided by Seller under the Contract. "Site" means the premises where Parts or Products are used or meant to be used and/or Services are performed or meant to be performed, not including any Seller Group's premises.

2. DELIVERY, TRANSFER OF TITLE & RISK, STORAGE, LIQUIDATED DAMAGES

2.1 Unless otherwise provided in the Contract and in accordance with Incoterms 2010: (i) for shipments that do not involve an exit out of Seller's country of incorporation, Seller shall Deliver the Products/Parts to Buyer FCA Seller's facility, place of manufacturer or warehouse; (ii) for shipments within the European customs territory, Seller shall Deliver CPT - carriage paid to named place of destination; (iii) for other export shipments out of Seller's country of incorporation, Seller shall Deliver Products/ Parts to Buyer FOB, in case of transportation by sea (specifying the port of export); FCA loaded into aircraft, in case of transportation by air (specifying the airport of export); or CPT - carriage paid to named place of destination specified between the parties, in case of transportation by rail or road. The "Delivery Date" for any item of Products/Parts is defined as the date on which such item is Delivered in accordance with this Article. Partial Delivery and Delivery in advance of the Delivery schedule shall be permitted, unless otherwise specified in the Contract.

2.2 Subject to Article 2.3, title and risk of loss to Products and/or Parts shall pass upon Delivery as provided in Article 2.1, with the exception that title and risk of loss to: (i) Products and/or Parts shipped from the United States of America ("U.S.") shall pass from Seller to Buyer immediately after each item departs from the U.S. territorial land, seas and overlying airspace, which the parties acknowledge extend to twelve nautical miles from the baseline of the country, determined in accordance with the 1982 United Nations Convention of the Law of the Sea; and (ii) Products and/or Parts to be shipped to a Delivery destination directly from countries different from Seller's country of incorporation (drop shipment), shall pass immediately after each item departs from the territorial land, seas and overlying airspace of the sending country. For the avoidance of doubt, Seller or its relevant Group member shall retain title to any equipment leased to Buyer Group.

2.3 If any of the Products and/or Parts cannot be shipped to Buyer in accordance with the agreed upon Delivery terms due to any cause not attributable to Seller Group, upon notice to Buyer, Seller may store such Products and/or Parts or ship them to outside storage, in which cases: (i) any amounts otherwise payable to Seller upon Delivery or shipment shall become payable upon presentation of a certification specifying the cause and place of storage (any payment security shall allow payments upon presentation of notice to storage instead of transport documents); (ii) all expenses incurred by Seller Group, such as for preparation and placement into storage, handling, inspection, preservation, insurance, removal charges, interest, and any VAT or other taxes imposed directly or indirectly under Applicable Law shall be reimbursed or paid by Buyer upon submission of Seller's invoices; and (iii) when reasonably possible and upon payment of all amounts due hereunder, Seller shall resume Delivery of the Products and/or Parts to the originally agreed point of Delivery. Title and risk of loss to Products and/or Parts shall pass as provided in Article 2.2. , provided that Seller shall not have any obligation to store any item beyond 60 calendar days and if the storage period extends beyond 60 days, Seller shall be entitled to resume Delivery of the Products/Parts in accordance with Article

2.1 . The terms of Article 2.3 shall apply also in the event any Buyer equipment repaired at Seller Group's facilities cannot be shipped to or received by Buyer in accordance with the agreed upon terms, provided that, in the case of Buyer equipment to be repaired at Seller Group's facilities, Buyer shall retain title to, and risk of loss for, any such equipment at all times.

2.4. In the event of a delay in the Delivery of Products and/or Parts beyond the contractually agreed Delivery Date or a delay in the commencement of the performance of Services beyond the contractually agreed commencement date, if such Delivery/ commencement is not excused under the terms of the Contract, Seller Group shall be liable exclusively for the following liquidated damages, unless a different amount is set forth in the Contract: 0.5% of the price of the delayed item for each week of delay, or 0.1% of the price of the delayed Service for each day of delay, in all cases cumulatively up to a maximum amount of 5% of the overall portion of the Contract Price allocable to the delayed Services, Products or Parts. The parties agree that such liquidated damages are not a penalty and represent a fair and reasonable estimate of the damages Buyer Group may suffer as a result of delay. SAID LIQUIDATED DAMAGES SHALL CONSTITUTE THE SOLE AND EXCLUSIVE LIABILITY OF SELLER GROUP AND THE SOLE AND EXCLUSIVE REMEDY OF BUYER GROUP FOR DELAY. No liquidated damages are due unless Buyer has suffered direct economic harm.

3. EXCUSABLE DELAYS

3.1 Neither party shall be liable or considered in breach or default of its obligations to the extent performance of such obligations is delayed or prevented, directly or indirectly, due to causes beyond the impacted party's reasonable control, including but not limited to: (i) acts of God, acts or omissions of governmental authorities, fire, severe weather conditions, earthquake, strikes or other labor disturbances, flood, serious risk of kidnapping, war (declared or undeclared), armed conflict, acts or threats of terrorism, epidemics, civil unrest, riot, severe delay in transportation, severe car shortage, or inability to obtain necessary materials, components or services; (ii) in the case of Seller, acts or omissions of Buyer Group, including failure to timely provide Seller Group with access, information, tools, material, and approvals necessary to permit Seller Group to timely perform the required activities, and including, without limitation, unknown physical conditions at the Site of an unusual nature and differing materially from those ordinarily encountered and generally recognized as occurring in the work of the character provided for in the Contract. The affected party shall promptly notify the other party in the event of a delay under this Article. The Delivery or performance dates shall be extended for a period equal to the time lost by reason of such delay, plus such additional time as may be reasonably necessary to overcome the effect of such delay. If Seller is delayed by acts or omissions of Buyer Group, or by the prerequisite work of Buyer's other contractors, Seller shall also be entitled to an equitable price adjustment. Under no circumstances shall Buyer's payment obligation be deemed excusable under this Article.

3.2 If a delay excused by this Article 3 extends for more than 90 days and the parties have not agreed upon a revised basis for resuming work, including an equitable price adjustment, then either party (except where delay is caused by Buyer Group, in which event only Seller), upon 30 days written notice may terminate the Contract with respect to the unexecuted portion of the work. In the event of a delay under Article 3.1(ii), the terms of Article 10.2 shall apply in full. In the event of a delay under Article 3.1(i), Buyer shall pay Seller the pro-rated Contract Price for all work performed before the effective date of termination.

4. WARRANTY

4.1 Subject to the limitations set forth in the Contract, Seller warrants to Buyer that: (i) the Products and/or Parts shall be Delivered free from defects in material, workmanship and title; and (ii) the Services shall be performed in a competent and diligent manner in accordance with any mutually agreed specifications. Unless Seller expressly agrees otherwise in writing and except for Products/Parts provided by Seller's Affiliates, any Parts not manufactured by Seller (including incidental materials and consumables used in the Services) shall carry only the warranty provided by the original manufacturers, and Seller gives no warranty for such Parts.

4.2 Unless otherwise stated in the Contract, the warranty period ("Warranty Period") shall be as follows: (i) for each Product (excluding Parts), 12 months from Start-Up date, or 8,600 running hours, or 18 months from the date of Delivery, or from the date of notice that the Products are ready for shipment, if the Delivery cannot take place for reasons not attributable to Seller Group, or from the date of notice that the Products are put into storage under Article 2.3, whichever occurs first; (ii) for Services, one year after performance of the Service; (iii) for Parts, 18 months after Delivery or 12 months after installation, whichever occurs first; (v) for repaired, replaced, or re-performed Products, Parts, or Services, six months after repair/replacement or re-performance, provided that Seller Group's warranty obligations shall in all cases terminate and in no event extend beyond 24 months after Delivery or placement into storage of the original Products/Parts or performance of the initial Service. As used herein, "Start-Up" means the equipment start-up activities to be carried out by Buyer in connection with the Products not later than 30 days from Seller's written notification that the Products are ready for start-up.

4.3 If Products, Parts, or Services do not meet the above warranties during the applicable Warranty Period and Buyer informs Seller in writing within 15 days of discovery, Seller's sole and exclusive liability shall be to either re-perform the defective Services, or repair or replace the defective component of the Products/Parts, at Seller's option. If despite Seller's reasonable efforts, a non-conforming Product/Part cannot be repaired or replaced, or non-conforming Services cannot be re-performed, the parties will negotiate an equitable adjustment in price with respect to such Product, Parts, component, or Service. Seller Group shall not under any circumstances be liable for defects that arise or are discovered after expiration of the Warranty Period.

4.4 Seller shall not be liable for accessing, retrieving, removing, or decontaminating defective Products or Parts, or for reinstalling repaired or replacement Products/Parts, or for any costs, damages, or losses incurred in connection with any of the above operations. Seller shall be responsible to transport defective Products or Parts only to and from the original Delivery point.

Buyer shall be responsible for all customs formalities, costs and taxes connected with any export to Seller or import of goods sent back to Buyer.

4.5 Seller does not warrant the Products, Parts or any repaired or replacement item against: normal wear and tear, including that due to environment, excessive operation at peak capability, frequent starting, type of fuel, detrimental air inlet conditions or erosion, corrosion or material deposits from fluids, misuse, accident, modification, heating, machining, bending, welding, alteration of any kind, or operation under conditions more severe than, or otherwise exceeding those set forth in, the specifications for the relevant Product or Part. The warranties and remedies set forth herein are further conditioned upon: (i) proper storage, installation, use, operation, and maintenance of the Products/Parts, and conformance with the operation instruction and installation manuals (including revisions thereto) provided by Seller Group; (ii) Buyer keeping accurate and complete records of operation and maintenance during the Warranty Period and providing Seller access to those records; and (iii) repair or modification pursuant to Seller's instructions and approval. Failure to meet any such conditions in Article 4.5 renders the warranty null and void.

4.6 THE REMEDIES SET FORTH IN ARTICLE 4 CONSTITUTE THE SOLE AND EXCLUSIVE REMEDIES FOR ALL

CLAIMS ARISING OUT OF OR RELATING TO ANY FAILURE OF, OR ANY DEFECT OR NON-CONFORMITY IN, THE

PRODUCTS, PARTS, OR SERVICES, REGARDLESS OF WHEN THE FAILURE, DEFECT OR NON-CONFORMITY ARISES AND REGARDLESS OF CAUSE OR ACTION. THE WARRANTIES SET FORTH IN ARTICLE 4 ARE

EXCLUSIVE AND IN LIEU OF ALL OTHER WARRANTIES, CONDITIONS, AND GUARANTEES, WHETHER WRITTEN, ORAL, IMPLIED, OR STATUTORY. NO IMPLIED OR STATUTORY WARRANTY OR CONDITION OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE SHALL APPLY.

Attachment 3

4.7 All Parts Delivered shall conform to Seller's part or version number specified in the Contract, or its equivalent or the superseding number subsequently assigned by Seller. If the number ordered is no longer available, Seller is authorized to provide a valid interchangeable Part without notice to Buyer.

5. INSPECTION AND FACTORY TESTS - The quality control exercised by Seller in its manufacture of Products/Parts shall be in accordance with Seller's normal quality control policies, procedures and practices. Unless otherwise expressly agreed in the Contract, Seller shall attempt to accommodate Buyer's requests to witness Seller's factory tests of Products/Parts, but only if such witnessing can be arranged without delaying the work. Access to Seller Group's premises shall be limited to areas directly concerned with the Products/Parts, excluding in all cases areas where work of a proprietary nature is conducted.

6. CHANGES - Each party may at any time propose changes in the schedule or scope of Parts, Products or Services in the form of a draft change order. Neither party is obligated to proceed with the changed schedule or scope until both parties agree to such change in writing. Unless otherwise agreed by the parties, pricing for additional work arising from such changes shall be at time and material rates.

7. PAYMENT

7.1 Buyer shall pay to Seller all invoiced amounts Net 30 days when due or in a timely manner according to the Contract. If nothing is agreed in the Contract, payment shall be made in US dollars or the currency set forth in the Seller’s proposal. Seller reserves the right to require Payment Milestones or require one or more irrevocable, unconditional, letters of credit payable at sight (“Payment Security”), without any set-off,and in the currency agreed in the Contract(or on the face of the purchase order). In the event Buyer requests payment by credit card, Seller at its option may add a 3% surcharge to the applicable Contract Price for processing fees associated with credit card transactions.

7.2 In addition to other Contract remedies, Buyer shall pay interest to Seller at the rate of 1.5% per month (or fraction thereof), not to exceed the lesser of 18% per annum or the maximum amount permitted by Applicable Law, on all amounts not timely paid in accordance with the Contract.

7.3 If applicable, each Payment Security shall be irrevocable and unconditional, and allow for pro-rata payments for partial Deliveries, other charges (e.g., storage, export shipments, cancellations, and adjustments), and all other payments due to Seller under the Contract. Each Payment Security shall be: (i) issued or confirmed by a primary international bank that is reasonably acceptable to Seller; (ii) payable at the counters of such bank; (iii) opened 30 days from the Contract effective date; and (iv) remain in effect until the latest of 90 days after the latest scheduled Products/Parts shipment, or completion of Services, or receipt by Seller of final payment. Buyer shall make relevant adjustments in the Payment Security (including increasing amounts or validity period, and including in accordance with the changes agreed in the Contract) as required to fulfill its payment obligations under the Contract, within 15 business days of Seller's notification that such adjustment is necessary. Seller will not have an obligation to begin performance until the Payment Security, or the required adjustment thereof, has become operative.

8. TAXES AND DUTIES

8.1 Seller shall be responsible for and shall pay when due and payable all Seller Taxes, and Buyer shall be responsible for and shall pay all Buyer Taxes. The Contract Price does not include any Buyer Taxes. Therefore, if any such taxes are applicable, they will be added to the Contract Price. For U.S. sales and use tax, and in other jurisdictions where applicable, Buyer may report/remit sales or similar taxes directly if Buyer timely provides a direct pay or exemption certificate to Seller.

8.2. If the Applicable Laws require the Contract to be subject to stamp duty, fee, or registration, Buyer shall be responsible for the required formalities and bear the related costs. Buyer shall return to Seller a copy of the registration certificate or a registered copy of the Contract within 10 days from the due date required by said Applicable Laws to register or pay for such stamp duty, fee, or registration. According to the Applicable Laws of the country in which Buyer has requested Seller to provide Services, Seller may be required to be registered locally, in which case, Seller shall perform the Services and invoice for them with the intervention of its relevant branch or permanent establishment.

8.3 If Buyer is required to deduct or withhold any Seller Taxes from the Contract Price, Buyer shall (1) give at least 30 days' notice to Seller that Buyer will withhold, (2) make all reasonable efforts to minimize any withholding tax from payments to Seller, in accordance with Applicable Laws and any applicable bilateral conventions against double taxation, and (3) provide to Seller, within 30 days from payment, the official receipt issued by the competent government authority to which the Seller Taxes have been paid, or an alternative document acceptable to the relevant tax authorities. . If Buyer requires tax residence certificates or other documentation from Seller to apply for any exempted or reduced tax regime, Seller shall submit the appropriate certificates upon Buyer's written request. If Buyer, under the Applicable Laws of any country other than Seller's country of incorporation or in which Seller has a branch, deducts or withholds Seller Taxes or fails to comply with the requirements of this clause, Buyer shall pay additional amounts to Seller so that Seller receives the full amount of the Contract Price, as though no such Seller Taxes had been deducted or withheld.

8.4 If Buyer benefits from any tax, fee or duty exemption which is applicable to Seller or Seller's Group, Buyer agrees to provide Seller, without charge and before the following as applicable: (1) entering into the Contract, (2) before invoicing, or (3) before any other relevant event, documentation acceptable to the competent tax authorities supporting the exemption, together with instructions on the exemption procedure. Buyer shall promptly inform Seller in writing about the revocation, expiry or other change of the exemption. If Seller is denied the exemption because of a failure of Buyer, Seller shall be entitled to invoice and Buyer shall pay promptly the applicable tax, fee or duty.

8.5 When Buyer arranges the export or intra-European Union ("EU") community shipment, Buyer will provide to Seller, free of charge and within 90 days (or, in the case of exports from the U.S., 30 days), evidence (obtained from Buyer's forwarder) of exportation or intra EU community shipment; such evidence must be in a form that is acceptable to the competent tax and customs authorities. Failing the above, Seller shall be entitled to invoice Buyer the applicable VAT, U.S. sales and use tax, or similar taxes.

9. ASSIGNMENT, NOVATION & SUBCONTRACTING - Buyer may assign or novate the Contract, in full or in part and including through change of ownership, only with the prior consent of Seller, which consent shall not be unreasonably delayed or withheld, provided that Seller shall be entitled to withhold such consent only for demonstrable reasons if the assignee/novatee lacks adequate financial capability, is a competitor or potential competitor of Seller or its Affiliates, causes Seller Group to be in breach of Applicable Law, and/or does not meet Seller's code of ethics. Seller may assign or novate to third parties the Contract, in full or in part, only with the prior consent of Buyer, which consent shall not be unreasonably delayed or withheld, provided that Seller may, without Buyer's consent: (i) assign or novate the Contract, in full or in part, to one or more Affiliates of Seller; and (ii) assign any receivables due hereunder to one or more Affiliates of Seller. The parties agree to execute such documents as may be necessary to effect the permitted assignments or novations. In the event of a novation or assignment by Buyer, Buyer shall cause the novatee/assignee to provide additional payment security at Seller's reasonable request. Any assignment or novation in violation of the above shall be void and without effect for the other party. Nothing herein shall restrict Seller from subcontracting portions of its work, provided that Seller remains responsible to Buyer for performance of such work.

10. TERMINATION AND SUSPENSION

10.1 Either party may terminate this Contract for default if: (i) any proceeding is brought against the other party, voluntarily or involuntarily, under applicable bankruptcy or insolvency laws, or if the other party is unable to pay its debts when due, to the extent permitted by Applicable Law; or (ii) the other party commits a material breach of this Contract, which does not otherwise have a specified contractual remedy, and fails to cure the breach within 30 days of notice from the non-breaching party, or if it is not possible to cure such breach within 30 days, fails to commence to cure the breach within 30 days of such notice or fails to thereafter continue diligent efforts to complete the cure as soon as reasonably possible. In the event of a termination by Buyer under this Article 10.1, Seller shall reimburse Buyer the difference between that portion of the Contract Price allocable to the terminated scope and the actual amounts reasonably incurred by Buyer to complete such terminated scope; and Buyer shall pay to Seller the portion of the Contract Price allocable to Products/Parts purchased and/or completed, and amounts for Services performed, before the effective date of termination. Said amounts shall be calculated using the applicable Contract rates, or in the absence of such rates, at Seller's then-current standard time and material rates. In the event there are agreed-upon Contract milestones, said amounts shall be calculated in accordance with the milestone schedule for completed milestones, and the Contract rates for work toward milestones not yet achieved.

10.2 Buyer may terminate the Contract (even in part) with a 20-day prior written notice for reasons other than those set forth in Article 10.1, in which case Buyer shall pay Seller's charges in accordance with the Contract termination schedule; or if no such schedule exists: (i) Buyer shall pay Seller all costs and expenses incurred by Seller in connection with work performed before the effective date of termination, plus a reasonable margin percentage in relation to such costs and expenses, which margin percentage shall not be lower than the margin percentage applicable to the overall Contract; or (ii) for Contracts based on payment milestones Buyer shall pay Seller: (a) all amounts due under the Contract for completed milestones, plus (b) all costs and expenses incurred by Seller in connection with work performed in relation to incomplete milestones, plus a reasonable margin percentage in relation to such costs and expenses, which margin percentage shall not be lower than the margin percentage applicable to the overall Contract. In connection with both (i) and (ii), Buyer shall also pay Seller the costs and expenses incurred by Seller as a direct result of the termination, including the costs associated with vendor disputes or Claims.

10.3 If Buyer fails to pay any outstanding undisputed invoice as set forth in the Contract, or fails to issue the Payment Security within the time agreed, Seller, upon a 15-day notice to Buyer, may suspend performance and Delivery. Any cost incurred by Seller as a result of such suspension (including storage, stand-by costs, demobilization and re-mobilization costs) shall be payable by Buyer upon submission of Seller's invoices. Performance of Seller's obligations shall be extended for a period equaling the period of Buyer's failure to meet its payment obligations, plus such additional time as may be reasonably necessary to overcome the effect of such payment delay. If suspension for Buyer’s failure to pay an undisputed invoice or failure to issue thePayment Security exceeds 15 days, Seller may at is sole option immediately terminate the applicable Contract for cause and Buyer shall also pay Seller the costs and expenses incurred by Seller as a direct result of the termination, including the costs associated with vendor disputes or Claims, plus a reasonable margin percentage in relation to such costs and expenses.

10.4 With a 20-day written prior notice, Buyer may elect to suspend performance of the Contract for a maximum cumulative period of 90 days, after which Seller may terminate the Contract and Article 10.2 shall apply. In the event of suspension under this Article 10.4, Buyer shall also pay all reasonable expenses incurred by Seller in connection with the suspension, including without limitation, expenses for repossession, fee collection, stand-by costs, demobilization/remobilization, and costs of storage. The schedule for Seller's obligations shall be extended for a period of time reasonably necessary to overcome the effects of such suspension.

11. COMPLIANCE WITH LAWS, CODES AND STANDARDS

11.1 The Contract Price is based on Seller Group's design, manufacture, testing, and Delivery of the Products, Parts and Services pursuant to: (i) its design criteria, manufacturing processes, and procedures and quality assurance program; (ii) those portions of industry specifications, codes, and standards in effect as of the date of entering into the Contract as are specified in the Contract; (iii) Applicable Law; and (iv) any mutually agreed-upon written terms and specifications set forth in the Contract.

11.2 Notwithstanding any other provision of this Contract, the parties shall at all times comply with Applicable Law in the performance of the Contract, except for Seller to the extent that such compliance is penalized under, or otherwise violates, the laws of the United States or any European Union laws.

11.3 Seller is entitled to an equitable adjustment to the Contract Price and the Delivery schedule to reflect any additional costs and other impact incurred by Seller Group as a result of a change in Applicable Law or applicable standards and regulations, including changes in the interpretation thereof, after entering into the Contract. In the event any such change prevents Seller Group from executing its obligations without breaching Applicable Law or makes Seller's execution of its ob ligations unreasonably burdensome or unbalanced, Seller shall also have the right to withdraw its Proposal or terminate the Contract without any liability.

11.4 Unless otherwise agreed in the Contract, Seller shall be responsible for timely obtaining the permits, licenses, and authorizations required for Seller Group to meet the requirements of the Contract, except that Buyer shall be responsible for timely obtaining any required permits, licenses, and authorizations that can only be obtained by Buyer Group. Buyer and Seller shall provide each other reasonable assistance in obtaining the required authorizations.

11.5. Buyer agrees that it will not sell, distribute, disclose, release or otherwise transfer any item or technical data provided under this Contract to: (i) any country designated as a "State Sponsor of Terrorism" by the U.S. Department of State including, for this Agreement, the countries of Cuba and North Korea (ii) any entity located in, or owned by an entity located in, a "State Sponsor of Terrorism" country or Cuba or North Korea, (iii) the region of Crimea or (iv) any person or entity listed on the "Entity List" or "Denied Persons List" maintained by the U.S. Department of Commerce, the list of "Specifically Designated Nationals and Blocked Persons" maintained by the U.S. Department of Treasury or any other applicable prohibited party list of the US Government. This clause will apply regardless of the legality of such a transaction under local law. Except as otherwise agreed in writing between the parties, each Party shall be responsible for obtaining and maintaining any authorization required for its performance under this Contract (including the transfer any item or technical data under this Contract), such as export license, import license, exchange permit or other required government export or import authorization. Each Party shall provide the reasonable assistance necessary for the other Party to secure and comply with such authorizations as may be required. Neither Party shall be liable if any government export authorization is delayed, denied, revoked, restricted or not renewed despite reasonable efforts by the Party. Additionally, such delay, denial, revocation or non-renewal shall not constitute a breach of this Agreement.

Buyer shall not use any items sold hereunder for any military application, or resell them for such purpose.

12. ENVIRONMENT, HEALTH, SAFETY AND SECURITY (EHSS)

12.1 Buyer shall take all actions necessary to provide a safe, healthy and secure work environment, including transportation and accommodation if applicable, for Seller Group personnel. Buyer shall inform Seller of any known risks, hazards, or changed conditions impacting worker health, safety or the environment, including the presence or potential presence of Hazardous Materials, and shall provide relevant information, including safety data sheets, site security plans, risk assessments and job hazard analyses.

12.2 To evaluate risks associated with the provision of Services and performance under this Article, Buyer shall provide Seller Group with reasonable access to review the Site and related equipment. If Seller's work at the Site is subject to local, state or national EHS legal requirements that are not reasonably available, Buyer shall notify and provide copies of same to Seller.

12.3 If Seller or Seller's representative believes in good faith that Site conditions, Seller transportation or accommodation provisions, or the actions of others threaten the health, safety, or security of Seller Group personnel or the environment, Seller or its representatives may, in addition to other rights or remedies available, STOP WORK, evacuate some or all of its personnel, suspend performance of all or any part of the Contract, and/or remotely perform or supervise work. If Seller exercises its rights under this provision, it shall give prompt notice to Buyer, and the parties shall work cooperatively to correct the conditions or actions prompting the STOP WORK. The parties agree there shall be no retaliation taken against any person who invokes their right under this provision to STOP WORK. Any delay resulting from Seller Group's exercise of its rights under this Article shall constitute an excusable delay.

12.4 To the full extent permitted by Applicable Law, Buyer agrees that it is the generator, and shall be solely responsible for the storage, transportation and disposal of all Hazardous Materials or waste related to or arising from the performance of Services at Buyer Group sites, including any removed from Seller's equipment. Prior to the transportation and disposal of waste materials by Buyer, Seller shall properly handle and manage all Hazardous Materials resulting from the Services in accordance with Applicable Law and Buyer's written requirements. If Seller Group encounters any Hazardous Materials, it may suspend work pending Buyer elimination of the hazardous condition. If any Seller equipment or Buyer equipment destined for a Seller facility is contaminated with Hazardous Materials, Buyer shall assume sole responsibility for decontaminating such equipment and returning it in the same condition received to allow for its safe handling and transportation in compliance with Applicable Law. If any such Hazardous Materials cause an increase in Seller's cost or time, Seller shall be entitled to an equitable adjustment in price and schedule.

13. ADDITIONAL EHSS PROVISIONS APPLICABLE TO SERVICES

13.1 Seller Group personnel shall not be required to work in excess of any time restriction prescribed by Applicable Law. Seller Group personnel will have at least one day of rest in any seven consecutive days; provided, the parties may agree upon exceptions consistent with Seller's working time policy.

13.2 Buyer shall provide medical care and facilities at the Site consistent with international industry standards. If Seller Group's personnel require urgent medical attention, Buyer shall make its medical facilities available to such persons as necessary. To the Attachment 3

extent Buyer cannot supply necessary urgent medical attention at the Site or any Buyer Group's site or while working offshore, Buyer shall provide for transport of Seller Group's personnel and access of such personnel to the nearest suitable urgent care facility. For offshore or remote work, Buyer shall be responsible for the medical evacuation of Seller Group's personnel from the Site to the departure point on the mainland or Buyer's designated medical services provider.

13.3 Buyer shall transport Seller Group's personnel, equipment and materials, including medi-vac, to and from all offshore locations and to such other job Sites as agreed, in compliance with Applicable Law and international industry standards regarding qualified personnel and safe operation and maintenance. Buyer Group agrees to make such equipment and information relating to its operation and maintenance available to Seller for review. Buyer shall provide personal protective equipment required during use of Buyer provided transportation to and from the offshore work and such other specialized equipment as agreed between the parties.

13.4 Buyer shall provide, at no cost to Seller, accommodation and messing for Seller Group's personnel, which offers a reasonable degree of comfort, is consistent with international industry standards and is at least comparable to that furnished to Buyer's management and technical personnel. Buyer shall provide telephone and computer internet connectivity to Seller Group's personnel at said accommodations.

14. CONFIDENTIALITY

14.1 "Confidential Information" means pricing for Parts, Products, and Services, and/or information that is designated in writing as "confidential" or "proprietary" at the time of disclosure, or orally designated as "confidential" or "proprietary" and confirmed in writing within ten days after oral disclosure. Confidential Information shall not include information that: (i) is or becomes generally available to the public other than from disclosure by the receiving party's Group; (ii) is or becomes available to the receiving party's Group on a non-confidential basis from a source other than the disclosing party and, after due inquiry, that source is not subject to a confidentiality obligation to the disclosing party; or (iii) is independently developed by the receiving party's Group without reference to the disclosing party's Confidential Information, as evidenced by written documents.

14.2 The parties shall: (i) use, reproduce, or disclose the other party's Confidential Information only in connection with the Contract and permitted use(s) and maintenance of Products, Parts and Services; (ii) take reasonable measures to protect the confidentiality, and prevent disclosure and unauthorized use of the Confidential Information and (iii) in particular, not disclose Confidential Information to the other party's competitors.

14.3 A party may disclose Confidential Information: (i) to any member of its Group who has a need to know to perform the Contract or use and maintain Products, Parts, or Services and who is bound in writing to confidentiality obligations and use restrictions at least as restrictive as in this Contract; and (ii) to comply with a legal obligation, but only after promptly notifying the disclosing party of its disclosure obligation so that the disclosing party may seek an appropriate protective order. Buyer shall not disclose Confidential Information to Seller unless required for Seller to perform under this Contract. Buyer warrants that it has the right to disclose the information and shall Indemnify Seller Group from any Claims or damages resulting from improper disclosure.

14.4 Neither party shall make any public announcement about any aspect of the Contract or related documents or information without prior written approval of the other party.

14.5 The confidentiality and use restrictions of this Article 14 shall survive any termination of the Contract for ten years. Each party shall Indemnify the other for failure to comply with this provision.

15. INTELLECTUAL PROPERTY

15.1 Seller shall Indemnify Buyer from any rightful Claims of third parties that the Products or Parts manufactured by Seller or its Affiliates infringe any utility patent of the U.S., EU, or the country of initial installation (if set forth in the Contract), provided that: (i) Buyer promptly notifies Seller in writing of any such claim; (ii) Buyer makes no admission of liability and does not take any position adverse to Seller regarding such claim and gives Seller authority, at Seller's expense, to direct and control all defense, settlement and compromise negotiations; and (iii) Buyer provides Seller with full disclosure and assistance that may be reasonably required to defend any such claim.

15.2 Seller shall have no obligation or liability with respect to any claim based upon: (i) any Products, Parts or Services that have been altered, modified, or revised; (ii) the combination, operation, or use of any Products, Parts or Services with other products or services when such combination is part of any allegedly infringing subject matter; (iii) failure of Buyer Group to implement any update provided by Seller Group that would have prevented the claim; (iv) unauthorized use of Products, Parts or Services, including without limitation a breach of the provisions of the Contract; or (v) Products, Parts or Services made or performed to Buyer Group's specifications.

15.3 Should any Products, Parts or Services become the subject of a claim, Seller may at its option: (i) procure for Buyer the right to continue using the Product, Part or Service, or portion thereof; (ii) modify or replace it in whole or in part to make it noninfringing; or (iii) failing (i) or (ii), take back Products or Parts, discontinue Services, and refund any fees received by Seller attributable to the infringing Product, Part or Service.

15.4 THE FOREGOING STATES SELLER GROUP'S ENTIRE AND EXCLUSIVE LIABILITY FOR ANY INTELLECTUAL AND INDUSTRIAL PROPERTY RIGHTS INFRINGEMENT.

15.5 Each party shall retain ownership of all Confidential Information and intellectual property it had prior to the negotiations of the Contract. Any and all new intellectual property conceived, created or provided by Seller Group under the Contract, whether alone or with any contribution from Buyer Group, shall be owned exclusively by Seller or other members of Seller Group, as the case may be. To the extent that Buyer Group may acquire any right or interest in such new intellectual property, Buyer irrevocably assigns, and agrees to assign and/or cause other members of Buyer Group to assign, all such rights and interests in such new intellectual property as instructed by Seller, and to execute assignments and other documentation as necessary to achieve this result. To the extent permissible by law, Buyer Group waives any moral rights it acquires in any such new intellectual property.

Seller shall grant Buyer use rights to utilize Seller's intellectual property embedded in the Products or Parts solely for standard use, operation, and maintenance of the Products/Parts by Buyer. Such license shall not give Buyer the right to manufacture and/or have manufactured such Products/Parts to the extent such maintenance will result in substantially new Products/Parts.

15.6 If Seller provides any Products that are software, including SaaS (Software as a Service), embedded software, or software that is installed on Buyer Group's equipment, the terms of the annexed Software License Addendum, shall apply. If there is any conflict between these Terms and Conditions and the terms of the Software License Addendum, the terms of the Software License Addendum shall prevail.

15.7 Buyer agrees that Seller may create, receive, maintain, transmit and otherwise have access to machine, technical, system, usage and related information, including, but not limited to, information about Buyer's products, services, systems and software, that is gathered periodically to facilitate the provision of Products, Parts, Services, other support, consulting, training and other services to Buyer (if any), and to verify compliance with the terms of this Contract. Seller and its Affiliates may use such information to provide, develop or improve their products or services.

16. INDEMNITY, LIMITATION OF LIABILITY, AND INSURANCE The provisions of Article 16 shall apply to the maximum extent permitted by Applicable Law and, unless otherwise expressly stated, prevail over any conflicting clauses.

16.1 (i) Seller agrees to Indemnify Buyer Group from and against any and all Claims for bodily injury, illness, or death suffered by any Seller Group's personnel, and/or for damage to or loss of any property of any Seller Group member (whether owned, hired, or leased, but excluding property leased to Buyer Group) arising out of or in connection with the Contract, REGARDLESS OF CAUSE OR ACTION. (ii) Buyer agrees to Indemnify Seller Group from and against any and all Claims for bodily injury, illness, or death suffered by any Buyer Group's personnel, and/or for damage to or loss of any property of any Buyer Group member (whether owned, hired, or leased, and including the Products and Parts (after Delivery), the Site, and any facilities or property thereon), arising out of or in connection with the Contract, REGARDLESS OF CAUSE OR ACTION.

16.2(i) Seller agrees to Indemnify Buyer Group from and against any rightful Claims of third parties on account of bodily injury, illness or death, or damage to or loss of property, to the extent resulting directly from the negligence of Seller Group in connection with performance of the activities under this Contract. (ii) Buyer agrees to Indemnify Seller Group from and against any rightful Claims of third parties on account of bodily injury, illness or death, or damage to or loss of property, to the extent resulting directly from the negligence of Buyer Group in connection with the activities performed under this Contract. (iii) In the event the injury or damage to third parties is caused by the joint or concurrent negligence of the parties or their respective Groups, each party shall bear such injury or damage proportionally to its Group's negligence. For the avoidance of doubt, no members of either party's Group shall be considered third parties and, for purposes of Seller's indemnity obligation in Article 16.2(i), no part of the Site or any property or facilities thereon shall be considered as third party property, and the Site owner and its partners, affiliates and contractors/subcontractors shall not be considered third parties. The reciprocal indemnities in this Article 16.2 shall apply only if the indemnified party: (i) promptly notifies the other in writing of the third party claim; (ii) makes no admission of liability, does not take any position adverse to the other party and gives such other party's authority to direct and control all defense, settlement and compromise negotiations; and (iii) provides the other party with full disclosure and assistance as may be reasonably required to defend such claim.

16.3 Except only as provided in Article 16.1(i) but notwithstanding anything else to the contrary herein, in the event the Site is offshore, Buyer assumes sole responsibility for and shall Indemnify the Seller Group (to the maximum extent permitted under applicable law) from and against any and all Claims asserted by or in favor of any person or party resulting from pollution, contamination or blow-out of any kind and including costs of pollution control, removal, spills, leakage, and clean-up. The above indemnity applies REGARDLESS OF CAUSE OR ACTION and even if the claim is on account of any defect in the Products, Parts or Services; but it shall not apply to surface pollution or spillage of fuels, lubricants, sewage or garbage to the extent such surface pollution or spillage originates from Seller Group's property while such property is in Seller Group's sole care, custody and control.

16.4 EXCEPT ONLY FOR SELLER'S OBLIGATIONS IN ARTICLES 8.1, 15, 16.1(i), AND 11.2 (TO THE EXTENT OF

FINES AND PENALTIES IMPOSED BY A GOVERNMENT AUTHORITY AS A RESULT OF SELLER'S VIOLATION OF

APPLICABLE LAW), SELLER GROUP'S TOTAL LIABILITY FOR ANY AND ALL CLAIMS OF ANY KIND,

REGARDLESS OF CAUSE OR ACTION, ARISING OUT OF OR RELATED TO THE CONTRACT, OR ITS

PERFORMANCE OR BREACH, INCLUDING WITHOUT LIMITATION WARRANTY AND TERMINATION, SHALL NOT UNDER ANY CIRCUMSTANCES EXCEED: (I) IN THE CASE OF CLAIMS RESULTING FROM THE PROVISION OR

FAILURE TO PROVIDE, OR FROM THE USE OR FAILURE TO USE PRODUCTS OR PARTS, THE CONTRACT PRICE ALLOCABLE TO THE PRODUCT AND/OR PARTS GIVING RISE TO THE CLAIM; AND (II) IN THE CASE OF CLAIMS

RESULTING FROM THE PROVISION OR FAILURE TO PROVIDE SERVICES, THE CONTRACT PRICE ALLOCABLE TO THE SERVICES GIVING RISE TO THE CLAIM. SELLER GROUP SHALL HAVE NO LIABILITY FOR ADVICE OR

ASSISTANCE GRATUITOUSLY PROVIDED BY SELLER GROUP BUT NOT REQUIRED PURSUANT TO THE CONTRACT. ALL SELLER GROUP'S LIABILITIES SHALL TERMINATE AT THE END OF THE RELEVANT

WARRANTY PERIOD, EXCEPT FOR CLAIMS THAT HAVE BEEN TIMELY COMMENCED BY BUYER IN ACCORDANCE WITH THE CONTRACT.

16.5 UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL LOSS. NOTWITHSTANDING ANYTHING TO THE CONTRARY, AND EXCEPT ONLY TO THE

EXTENT OF AGREED LIQUIDATED DAMAGES AND ANY PREDETERMINED TERMINATION FEES DUE TO SELLER

UNDER THE CONTRACT, SELLER SHALL INDEMNIFY BUYER GROUP FROM AND AGAINST ANY AND ALL DIRECT OR INDIRECT CLAIMS FOR CONSEQUENTIAL LOSS OF SELLER GROUP; AND BUYER SHALLINDEMNIFY

SELLER GROUP FROM AND AGAINST ANY AND ALL DIRECT OR INDIRECT CLAIMS FOR CONSEQUENTIAL LOSS OF BUYER GROUP REGARDLESS OF CAUSE OR ACTION.

16.6 NOTWITHSTANDING ARTICLE 16.2(i), IN THE EVENT BUYER GROUP PROVIDES PRODUCTS OR PARTS TO A

THIRD PARTY OR USES SELLER'S PRODUCTS/PARTS AT A FACILITY NOT OWNED BY BUYER, OR THE

SERVICES ARE PERFORMED AT A FACILITY NOT OWNED BY BUYER, BUYER SHALL INDEMNIFY SELLER

GROUP FOR AND AGAINST ANY LIABILITY ARISING OUT OF CLAIMS MADE IN EXCESS OF THE LIMITATIONS AND EXCLUSIONS SET FORTH IN THE CONTRACT, REGARDLESS OF CAUSE OR ACTION. IN THE EVENT BUYER

ASSIGNS OR NOVATES THE CONTRACT, IN WHOLE OR IN PART, SUCH ASSIGNEE OR NOVATEE SHALL BE

BOUND BY THE SAME TERMS OF THIS CONTRACT, AND BUYER HEREBY WAIVES ANY RIGHT TO CLAIM,

WHETHER IN TORT, AT LAW OR OTHERWISE, FOR DAMAGES OR LIABILITIES OF ANY KIND IN EXCESS OF THE LIMITATIONS AND EXCLUSIONS SET FORTH IN THE CONTRACT.

16.7 Buyer and Seller each covenant and agree to support their mutual indemnity obligations under Article 16 by procuring and maintaining, at the indemnifying party's sole expense, insurance policies meeting the following requirements: (i) Workers Compensation/Employer's Liability as per Applicable Law; (ii) Comprehensive General Liability: Combined Single Limits for Bodily Injury and Property Damage $1,000,000 (one million) per occurrence and $2,000,000 (two million) in the aggregate (or its equivalent in another relevant currency), which may be satisfied through a combination of underlying and excess coverages. The parties agree that, to the extent of the indemnifying party's liability and indemnity obligations under this Contract, the indemnifying party's General Liability policies shall include the indemnified party Group as additional insured<(>,,<)> contain blanket contractual liability coverage, be primary, and receive no contribution from any insurance policies maintained by or on behalf of the indemnified party. Each party, on request, shall provide to the other party insurance certificates evidencing the aforementioned limits and terms of insurance. Buyer and Seller shall each arrange for any of their respective insurance policies hereunder to contain provisions whereby, to the extent of each party's liability and indemnity obligations under this Contract, their insurers waive their rights of subrogation against the other party's Group, as well as the other party's respective insurers.

17. NO NUCLEAR USE - The Products, Parts and/or Services are not intended or authorized for use in connection with any nuclear facility or activity, and Buyer warrants that it shall not use, or permit others to use, Products, Parts and/or Services in connection with or for any such purposes without the advance written consent of Seller. If, in breach of the foregoing, any such use occurs, Seller hereby disclaims any and all liability for any nuclear or other damage, injury, or contamination REGARDLESS OF CAUSE OR ACTION. In addition to any other rights of Seller and to the maximum extent permitted under Applicable Law, Buyer assumes sole responsibility for, and shall Indemnify Seller Group from and against, any and all Claims asserted by or in favor of any person or party resulting from any nuclear or other damage, injury, or contamination REGARDLESS OF CAUSE OR ACTION. Consent of Seller to any use in connection with any nuclear facility or activity, if any, will be conditioned upon additional terms and conditions that Seller determines to be acceptable for protection against nuclear liability.

18. ADDENDA - If any Products/Parts include executable binary code, or if Seller provides any remote diagnostic, rental tools, training, or other special Services, the terms of the respective annexed Cybersecurity Services Addendum, Remote Diagnostic Services Addendum, Rental Tools Addendum, Training Addendum and/or other addendum shall apply. If there is any conflict between these Terms and Conditions and the terms of any applicable addendum, the terms of the applicable addendum shall prevail.

19. GOVERNING LAW - This Contract shall be governed by and construed in accordance with the laws of (i) the State of New York, if Seller is incorporated in the U.S.; or (ii) England and Wales, if Seller is incorporated outside the U.S., excluding in any case conflict of law rules.

20. DISPUTE RESOLUTION - Any dispute arising out of or in connection with this Contract shall be referred to settlement proceedings under the International Chamber of Commerce (ICC) Mediation Rules, without prejudice to either party's right to seek emergency, injunctive, or conservatory measures of protection at any time. If any such dispute has not been settled within 60 days following the filing of a Request for Mediation (or such other period of time as may be reasonable under the circumstances or agreed in writing), the dispute shall be finally settled in accordance with the ICC Rules of Arbitration by one or more arbitrators appointed under the said Rules. The seat, or legal place, of arbitration shall be (i) Houston, Texas USA.

21. GENERAL CLAUSES

21.1 Except as otherwise expressly provided with regard to the members of each party's Group, none of the terms herein are intended to be enforced by third parties under the United Kingdom Contracts (Rights of Third Parties) Act (1999), where applicable. Buyer and Seller shall be entitled to modify, vary, amend and/or extinguish such rights without the consent of any third parties or member of either party's Group.

21.2 This Contract represents the entire agreement between the parties and no modification, amendment, rescission, waiver or other change shall be binding on either party unless agreed to in writing by their authorized representatives. Each party agrees that it has not relied on, or been induced by, any representations of the other party not contained in the Contract.

21.3 The invalidity in whole or in part of any part of this Contract shall not affect the validity of the remainder of the Contract. In Attachment 3

Cooper Machinery Services is an equal opportunity employer and gives all qualified applicants consideration of employment without regard to race, color, religion, age, sex, sexual orientation, gender identity,genetic information, national origin, disability status, protected veteran status, or any other characteristic protected by federal, state, or local laws. the event any provision of this Contract is held invalid or unenforceable, only the invalid or unenforceable part of the provision shall be severed, leaving intact and in full force and effect the remainder of the sentence, clause and provision to the extent not held invalid or unenforceable.

22. U.S. GOVERNMENT CONTRACTS

22.1 This Article 22 applies only if the Contract is for the direct or indirect sale to any agency of the U.S. government and/or is funded in whole or in part by any agency of the U.S. government. Buyer agrees that all Products, Parts and Services provided by Seller meet the definition of "commercial-off-the-shelf" ("COTS") or "commercial item" as those terms are defined in Federal Acquisition Regulation ("FAR") 2.101. To the extent the Buy American Act, Trade Agreements Act, or other domestic preference requirements are applicable to this Contract, the country of origin of Products/Parts is unknown unless otherwise specifically stated by Seller in this Contract. Buyer agrees any Services offered by Seller are exempt from the Service Contract Act of 1965 (FAR 52.222-41). The version of any applicable FAR clause listed in this Article 22 shall be the one in effect on the effective date of this Contract.

22.2 If Buyer is an agency of the U.S. government, then as permitted by FAR 12.302, Buyer agrees that all paragraphs of FAR

52.212-4 (except those listed in 12.302(b)) are replaced with these Terms and Conditions. Buyer further agrees the subparagraphs of FAR 52.212-5 apply only to the extent applicable for sale of COTS and/or commercial items and as appropriate for the Contract Price.

22.3 If Buyer is procuring the Products, Parts or Services as a contractor, or subcontractor at any tier, on behalf of any agency of the U.S. government, then Buyer agrees that FAR 52.212-5(e) or 52.244-6 (whichever is applicable) applies only to the extent applicable for sale of COTS and/or commercial items and as appropriate for the Contract Price. If the reasonableness of the price cannot be established through adequate price competition, or if cost or pricing data should be required for any other reason, or if a Product, Part or Service cannot be considered a "commercial item", Seller may terminate the Contract without penalty and be reimbursed for work done before the effective date of termination.

22.4 Seller reserves the right to reject any order from a Buyer listed on any denied party list.

COOPER MACHINERY SERVICES - TERMS & CONDITIONS FOR SALE OF PRODUCTS, PARTS & SERVICES February 1, 2022 COOPER MACHINERY SERVICES©
Attachment 3

Page : 1 of 2
Invoice No : 91410913
Cooper Machinery Services

INVOICE
Invoice Date : SEP 13 2023 Remit to:

Cooper Machinery Services LLC
P.O.Box 676062
DALLAS, TX 75267-6062
Federal Tax ID: 46-5397496
Wire Transfer To:

PNC Bank, N.A.
500 First Avenue
Pittsburgh, PA 15219
Account No: 8026456125
Routing No: 031207607
Swift No: PNCCUS33
ACH Remit To:

PNC Bank, N.A.
500 First Avenue
Pittsburgh, PA 15219
Account No: 8026456125
Routing No: 031207607
Inquiries To:

Cooper Machinery Services LLC
Odessa Sales Office
8927 Andrews Highway
Odessa, TX, 79765
Phone: 432-362-2511
Please, include invoice number or payment
reference information when making payment.

Send payment confirmation/remittance
advice to [email protected]
Payment Terms : ZN30-Net 30 Days From Date Of Invce
Terms & Conditions : As Attached/Included
Freight Terms : FCA-Free Carrier
Free Carrier
Ship From : DEER PARK
Shipped Date :

Invoice To: 120967
City of Watsonville Water Resources
500 Clearwater Lane
WATSONVILLE CA 95076-9556
USA
Ship To : 120967
City of Watsonville Water Resources
500 Clearwater Lane
WATSONVILLE CA 95076-9556
USA
Sales Order : 601006298
Inside Sales Contact: Mark Chaffino
Outside Sales Contact AM: Mike Perez PH: 562-818-2094
Email: [email protected]
Customer Reference : VERBAL-RYAN SMITH
ASSIST WITH INSPECTIONS AND CONDUCT TOP-END OVERHAUL ON SUPERIOR 8GTLB ENGINE S/N 307019 CONTACT: RYAN SMITH
JOB #40031551
Item Material Number Qty Unit Net Price Extended Price
Description USD USD
000110 FREIGHT-SP 1.000 EA 10,614.24 10,614.24
Toolbox / Parts deliveries
000120 FREIGHT-SP 1.000 EA 5,307.12 5,307.12
Toolbox pickup
Attachment 4

Page : 2 of 2
Invoice No : 91410913
Cooper Machinery Services
000130 FREIGHT-SP 1.000 EA 178.49 178.49
UPS shipment
000170 Z2-01S-098-010-S 8.000 PC 199.95 1,599.60
4IN SILICON SEAL
000180 Z040-041-001 8.000 EA 80.60 644.80

TEFLON LINER SEAL (NARROW)
000190 Z909-981-230S4 8.000 PC 16.56 132.48
GASKET (.047)
000200 ZS-10052 20.000 PC 18.79 375.80

GASKET INSERT(GARLOCK)
000210 Z2-01S-098-057 6.000 EA 20.57 123.42

SEAL RING JOINT
000220 Z01EN1600PF 32.000 EA 10.10 323.20
NUT LOCK - ELASTIC TYPE 1"-14
Price summary :

Total Price : 19,299.15 USD
Inflation Surcharge
State Tax : 191.95 USD
County Tax : 39.99 USD
Transit Tax : 56.00 USD
Total Tax : 287.94 USD
Total Invoice Value : 19,587.09 USD
Attachment 4

Reso No. (CM)
Meeting Date: 011624 SWZ ______ RM ______ PWU ______
1 RESOLUTION NO. __________ (CM)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

WATSONVILLE APPROVING SOLE SOURCE PURCHASE FROM
COOPER MACHINERY SERVICES LLC., A CORPORATION, FOR THE

PURCHASE OF PARTS USED FOR THE WASTEWATER TREATMENT
FACILITY COGENERATION SYSTEM FOR FY23/24, IN AN AMOUNT
NOT TO EXCEED $179,498.20 (FUNDED FROM THE WASTEWATER

ENTERPRISE FUND)
WHEREAS, bidding requirements for the purchase of supplies, equipment and nonpersonal contractual services and the sale of personal property are set forth in Chapter 5 of Title 3 of the Municipal Code; and
WHEREAS, subdivision (c) of § 3-5.210 exempts equipment that is unique, available only from one source, or sought to match existing equipment or supplies already in use (also known as a sole source purchase); and
WHEREAS, Cooper Machinery Services LLC presently supplies cogeneration system engine parts to the City; and
WHEREAS, Cooper Machinery Services LLC is the only company that produces parts that meet the City’s needs; and
WHEREAS, the City’s year-to-date expenditures on December 12, 2023 total $93,390.27; and
WHEREAS, additional needed expenditures this fiscal year total $86,107.93, therefore costs to maintain the cogeneration system engine will exceed $100,000; and WHEREAS, the City Charter of the City of Watsonville requires the City Council of the City of Watsonville to approve any purchasing agreement in excess of $100,000.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATSONVILLE, CALIFORNIA, AS FOLLOWS:

Reso No. (CM)
Meeting Date: 011624 2

1. This action does not meet CEQA’s definition of a “project”, because the action does not have the potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.

2. The Council finds that Cooper Machinery Services LLC is the only company that produces parts that meet the City’s needs.

3. This purchase is exempt from the purchasing procedures of Chapter 5 of Title 3 of the Municipal Code as a sole source purchase under subdivision (c) of § 3-5.210 of the Municipal Code.

4. That this purchase from Cooper Machinery Services LLC, a corporation, in an amount not to exceed $179,498.20 for FY23/24, is hereby authorized. ********************************

1/11/2024 6:09:31 PM
C:\Program Files\eSCRIBE\TEMP\1892738183\1892738183,,,Report - Approve OES Resolution .docx Agenda Report
MEETING DATE: Tuesday, January 16, 2024
TO: City Council
FROM: ADMINISTRATIVE SERVICES DIRECTOR DURAN

ASSISTANT FINANCE MANAGER RODRIGUEZ
THROUGH: CITY MANAGER MENDEZ
SUBJECT: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

WATSONVILLE APPROVING THE STATE OF CALIFORNIA
GOVERNOR’S OFFICE OF EMERGENCY SERVICES (OES)
DESIGNATION OF APPLICANT’S AGENT RESOLUTION FOR
NON-STATE AGENCIES; AUTHORIZING THE CITY MANAGER,

OR ADMINISTRATIVE
RECOMMENDED ACTION:

Staff recommends that the Council approve the State of California Office of Emergency (OES) Designation of Applicant Agent Resolution for non-state agencies. Staff recommends that the Resolution be a “universal” resolution. A “universal resolution” would be effective for the current and any disasters during the next three years.

DISCUSSION:

On January 4, 2023, the President declared a national emergency due to the storms. This action unlocked federal funding due to the storm damages. The City will be requesting reimbursement from both OES and FEMA for our qualified expenses. This Resolution authorizes the Administrative Services Director and the Assistant Finance Manager to apply for expense reimbursement for this and any other declared disaster within three years.

FINANCIAL IMPACT:

The City will be reimbursed by FEMA and OES for the City’s qualified expenses.

ALTERNATIVE ACTION:

The Council could decline to approve the resolution, which would prevent the City from seeking reimbursement from FEMA and OES for declared disasters.

ATTACHMENTS AND/OR REFERENCES (If any):

None.

1 Reso No. ______ (CM)
Meeting Date: 011624 SWZ ______ RM ______ Finance ______ RESOLUTION NO.__________ (CM)

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

WATSONVILLE APPROVING THE STATE OF CALIFORNIA
GOVERNOR’S OFFICE OF EMERGENCY SERVICES (OES)
DESIGNATION OF APPLICANT’S AGENT RESOLUTION FOR NONSTATE AGENCIES; AUTHORIZING THE CITY MANAGER, OR

ADMINISTRATIVE SERVICES DIRECTOR, OR ASSISTANT FINANCE

MANAGER TO APPLY FOR REIMBURSEMENT FOR ALL OPEN AND

FUTURE DISASTERS
WHEREAS, the Designation of Applicant’s Agent Resolution for Non-State Agencies is a universal resolution and is effective for all open and future disasters.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WATSONVILLE, CALIFORNIA, AS FOLLOWS:

1. Adopting a Resolution approving the State Governor’s OES Agent Resolution does not meet CEQA's definition of a “project,” because the action does not have the potential for resulting in either a direct physical change in the environment or a reasonably foreseeable indirect physical change in the environment.

2. That the State of California Governor’s Office of Emergency Services Designation of Applicant’s Agent Resolution for Non-State Agencies, a copy of which is attached hereto and incorporated herein by this reference, is hereby approved.

3. That the City Manager, or Administrative Services Director, or Assistant Finance Manager be and are hereby authorized and directed to apply for all open and future disasters for and on behalf of the City of Watsonville. **********************************

STATE OF CALIFORNIA
CALIFORNIA GOVERNOR’S OFFICE OF EMERGENCY SERVICES Cal OES ID No: ______________________ CAL OES 130
DESIGNATION OF SUBRECIPIENT’S AGENT RESOLUTION
Hazard Mitigation Grant Program and Pre-Disaster Mitigation Program

BE IT RESOLVED BY THE OF THE
(Governing Body) (Name of Applicant)

THAT , OR
(Title of Authorized Agent)
, OR
(Title of Authorized Agent)
(Title of Authorized Agent)
is hereby authorized to execute for and on behalf of the , a public entity (Name of Subrecipient)
established under the laws of the State of California, this application and to file it with the California Governor’s Office of Emergency Service. for the purpose of obtaining certain federal financial assistance under Public Law 93-288 as amended by the Robert T. Stafford Disaster Relief and Emergency Assistance Act of 1988, and/or state financial assistance under the California Disaster Assistance Act.

THAT the ________________________________________________, a public entity established under the laws of the State of California, (Name of Subrecipient)
hereby authorizes its agent(s) to provide to the California Governor’s Office of Emergency Service for all matters pertaining to such state disaster assistance the assurances and agreements required.

Please check the appropriate box below:

This is a universal resolution and is effective for all open and futures Disasters/Grants up to three (3) years following the date of approval below.

This is a Disaster/Grant specific resolution and is effective for only Disaster/Grant name/number(s) ________________________ Passed and approved this day of , 20
(Name and Title of Governing Body Representative)
(Name and Title of Governing Body Representative)
(Name and Title of Governing Body Representative)

CERTIFICATION
I, , duly appointed and of
(Name) (Title)
, do hereby certify that the above is a true and correct copy of a (Name of Applicant)
Resolution passed and approved by the of the
(Governing Body) (Name of Applicant)
on the day of , 20 .

Cal OES 130 (Rev.03/278/17) Page 1
(Signature) (Title)
5820
City Council City of Watsonville City Manager Administrative Services Director Assistant Finance Manager City of Watsonville City of Watsonville 16th January 24 Irwin Ortiz City Clerk City of Watsonville City Council City of Watsonville 16th January 24 City Clerk

STATE OF CALIFORNIA

CALIFORNIA GOVERNORS OFFICE OF EMERGENCY SERVICE
CAL OES 130 - INSTRUCTIONS
Cal OES Form 130
Instructions
A new Designation of Applicant’s Agent Resolution is required if the previously submitted document is older than three (3) years from the last date of Board/Council approval.

When completing the Cal OES Form 130, Subrecipients should fill in the blanks on page 1. The blanks are to be filled in as follows:

Resolution Section:

Governing Body: This is the individual or group responsible for appointing and approving the Authorized Agents. Examples include: Board of Directors, City Council, Board of Supervisors, etc.

Name of Subrecipient: This is the official name of the non-profit, agency, city, county or special district that has applied for the grant.

Examples include: City of Sacramento; Sacramento County; or Los Angeles Unified School District.

Authorized Agent: These are the individuals that are authorized by the Governing Body to engage with the Federal Emergency Management Agency and the California Governor’s Office of Emergency Service regarding grants applied for by the subrecipient.

There are two ways of completing this section:

1. Titles Only: If the Governing Body so chooses, the titles of the Authorized Agents should be entered here, not their names. This allows the document to remain valid if an Authorized Agent leaves the position and is replaced by another individual. If “Titles Only” is the chosen method, this document must be accompanied by a cover letter naming the Authorized Agents by name and title. This cover letter can be completed by any authorized person within the agency (e.g.; City Clerk, the Authorized Agent, Secretary to the Director) and does not require the Governing Body’s signature.

2. Names and Titles: If the Governing Body so chooses, the names and titles of the Authorized Agents should be listed. A new Cal OES Form 130 will be required if any of the Authorized Agents are replaced, leave the position listed on the document or their title changes.

Governing Body Representative: These are the names and titles of the approving board members. Examples include: Chairman of the Board, Superintendent, etc. The names and titles cannot be one of the designated Authorized Agents.

Certification Section:

Name and Title: This is the individual that was in attendance and recorded the Resolution creation and approval.

Examples include: City Clerk, Secretary to the Board of Directors, County Clerk, etc. This person cannot be one of the designated Authorized Agents to eliminate “Self Certification.” Cal OES 130 (Rev.03/28/17 Page 2

1/11/2024 8:09:25 PM
C:\Program Files\eSCRIBE\TEMP\2091638944\2091638944,,,Report - Support Measure N for Watsonville Community Hospital.docx Agenda Report
MEETING DATE: Tuesday, January 16, 2024
TO: City Council
FROM: CITY MANAGER MENDEZ
SUBJECT: RESOLUTION SUPPORTING THE PAJARO VALLEY HEALTHCARE DISTRICT GENERAL OBLIGATION BOND – MEASURE N
RECOMMENDED ACTION:

Approve Resolution No. XXX, of the City Council of the City of Watsonville in Support of the Pajaro Valley Healthcare District General Obligation Bond – Measure N to Improve the Quality of Healthcare at the Watsonville Community Hospital on the Ballot for the March 5, 2024, Presidential Primary Election.

BACKGROUND:

On December 5, 2021, the Watsonville Hospital Corporation filed for bankruptcy relief to reorganize the Watsonville Community Hospital (WCH). Shortly thereafter, the City, County, Salud Para La Gente, and the Community Health Trust of Santa Cruz quickly came together and formed the Pajaro Valley Healthcare District Project (Project) as a nonprofit to acquire the WCH from bankruptcy and return it back to the community.

After a lot of hard work, local fund raising, State funds, the WCH was purchased for the community. Another great result was the establishment of the Pajaro Valley Health Care District that was established in record time via the passage of SB 418.

On December 27, 2021, the Project entered into an Asset Purchase Agreement (APA) to purchase the Hospital’s operating assets. On February 23, 2022, the Court approved the sale of the Hospital to the Project. Upon completion of the sale, the Project assigned the APA to the Pajaro Valley Health Care District (PVHCD) Hospital Corporation as the buyer of the Watsonville Community Hospital. The PVHCD Board of Directors and the District Hospital Board of Directors (District Hospital Board), which are a mirror board comprised of the same individuals, assumed ownership and operations of the hospital in August 2022.

The City has been a major partner and support of the WCH and since December 5, 2021, not only took on a major partner role1, but contributed $400,000 to help purchase the hospital,

1 City Clerk staffed the initial Hospital District Board Meetings and also Interim City Manager Vides sat on the Board.

1/11/2024 8:09:25 PM
C:\Program Files\eSCRIBE\TEMP\2091638944\2091638944,,,Report - Support Measure N for Watsonville Community Hospital.docx provided a short term $5 million loan, and recently approved a $1 million commercial loan guarantee.

DISCUSSION:

As a result of the significant support the City has provided the WCH over the last couple of years as they worked through the bankruptcy, purchase of the hospital and now improving/reorganizing, staff felt it was appropriate to bring this resolution of support for Measure N for Council’s consideration.

A viable hospital is important not only because of the significant health and wellness quality of life benefits for the community, but it also has significant economic benefits, as a major employer and business. Furthermore, it is an important component of, and it complements many elements of our Strategic Plan.

For information purposes attached are the Impartial Analysis and Argument in Favor of Measure N, provided by the WCH. Staff from the Hospital and PVHCD Board Member(s) will be present to answer questions and provide information if necessary. However, there will be an update presented by the WCH Chief Executive Officer at the February 13th Council meeting. Due to a scheduling conflict and also the items expected for this agenda, it was not possible to include the presentation as part of this item. Nevertheless, since the election is a couple of months away, staff felt it appropriate to include this item for the Council’s consideration on the Consent Agenda.

STRATEGIC PLAN:

This item supports the following strategic priorities: 1) economic development, 2) infrastructure & environment, 5) public safety, and 6) community engagement and well-being.

FINANCIAL IMPACT:

This item does not have a direct fiscal impact on the City’s budget.

ALTERNATIVE ACTION:

While not recommended, the Council could choose not to adopt a resolution supporting Measure N or provide different direction.

ATTACHMENTS AND/OR REFERENCES (If any):
1) WCH Impartial Analysis of Measure N
2) WCH Measure N Argument in Favor