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HomeMy WebLinkAbout09-29-2015 2g Energy, Inc - AgreementAGREEMENT THIS AGREEMENT is made and entered into in the City of San Luis Obispo ond2q SST, ZD)Sby and between the CITY OF SAN LUIS OBISPO, a municipal corporation, hereinafter referred to as City, and 2G ENERGY, INC., hereinafter referred to as Contractor. WITNESSETH: WHEREAS, the City wants to retain the services of Contractor to provide service and maintenance on the CHP Cogeneration Module located at the City of San Luis Obispo's Water Resource Recovery Facility; to include parts when necessary in order to maintain the Module in proper working order. The full service and performance agreement is attached as Exhibit A and incorporated herein. WHEREAS, Contractor is qualified to perform this type of service and has submitted a service agreement contract, attached and incorporated herein as Exhibit A, which has been accepted by City. NOW THEREFORE, in consideration of their mutual promises, obligations and covenants hereinafter contained, the parties hereto agree as follows: TERM. The term of this Agreement shall be from the date this Agreement is made and entered, as first written above, until June 30, 2016 and will renew each year thereafter on July I". 2. CITY'S OBLIGATIONS. For providing services as specified in this Agreement, City will pay and Contractor shall receive therefore compensation as is expressed in Exhibit A "in a total sum not to exceed $3.00 per estimated 8,000 MODULE operating hours." The City agrees to issue a purchase order for the first term at an estimated 6,830 operating hours." The estimated value of this term, for the agreed and selected service plan and options in Appendix II, is $20,500.00. The contract will then renew with a purchase order issued on or before 1 July 2016." 3. CONTRACTOR'S OBLIGATIONS. For and in consideration of the payments and agreements hereinbefore mentioned to be made and performed by City, Contractor agrees with City to provide services and performance as set forth in Exhibit A and B attached hereto and incorporated into this Agreement. 4. AMENDMENTS. Any amendment, modification or variation from the terms of this Agreement shall be in writing and shall be effective only upon approval by the City Administrative Officer of the City. Page 2 5. COMPLETE AGREEMENT. This written Agreement, including all writings specifically incorporated herein by reference, shall constitute the complete agreement between the parties hereto. No oral agreement, understanding, or representation not reduced to writing and specifically incorporated herein shall be of any force or effect, nor shall any such oral agreement, understanding, or representation be binding upon the parties hereto. 6. NOTICE. All written notices to the parties hereto shall be sent by United States mail. postage prepaid by registered or certified mail addressed as follows: City City Clerk City of San Luis Obispo 990 Palm Street San Luis Obispo, CA 93401 Contractor 2G Energy, Inc. 205 Commercial Drive St. Augustine, FL. 32092 7. AUTHORITY TO EXECUTE AGREEMENT. Both City and Contractor do covenant that each individual executing this agreement on behalf of each party is a person duly authorized and empowered to execute Agreements for such party. IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed the day and year first above written. :hT l'I.SvI q .—City Clerk CITY OF SAN LUIS O ISPO, A Municipal Corporation By APPWDVED AS TO FORM: CONTRACTOR B _ 2G Energy, Inc. Div i A40A) %7 'b2=,a& Tb2 o,= �5t cW T 2G 2G Energy, Inc. 2G Energy, Inc. 205 Commercial Drive St. Augustine, FL 32092 Tel.: +1- 904579 -3217 Fax: +1- 904 -406 -8727 E -mail: info @29-coEen.com Web: htto: / /www.2g:gnergy.com/ CHP Cogeneration System Service Agreement SERVICE AGREEMENT entered into this 5� day of 6c'regWK 2015 by and between 213 Energy, Inc., 205 Commercial Drive, St. Augustine, FL 32092 (2G Energy, Inc. / SERVICE PROVIDER) and The City of San Luis Obispo Public Utilities, for the Water Resource Recovery Facility located at 35 Prado Road, San Luis Obispo, CA 93401 -7314 (CUSTOMER). WHEREAS SERVICE PROVIDER is in the business of manufacturing, selling, distributing, installing, and servicing CHP cogeneration & power generation systems, and providing certain specified maintenance services related to those products / systems to its customers; and WHEREAS CUSTOMER wishes to retain SERVICE PROVIDER to render and to provide services specified below under the terms and conditions of this Service Agreement CONTRACT. 1. Definitions 1.1 The term "MODULE" means the CHP Power Generation Module of the CUSTOMER described in Appendix I to this Contract. 1.2 The term "SERVICE" means only those scheduled service measures concerning the MODULE, all as set forth more particularly in the List of Services and Schedule of Maintenance Levels attached to this Contract as Appendix II, and incorporated herein. 1.3 The term "PARTS" means new or factory remanufactured parts with warranty coverage, materials, components and other goods supplied by SERVICE PROVIDER, its subcontractors or suppliers for the fulfilment of this CONTRACT. 1.4 The term "BUSINESS HOURS" means regular working & business hours, weekdays between 08:00 and 17:00. Public holidays, and weekends are not regular working and business days. 2. Subject of the Service Agreement CONTRACT 2.1 The subject of this Contract is performance of SERVICE provided by the SERVICE PROVIDER for the MODULE described in Appendix I in accordance with the terms and conditions set forth herein. 2.2 The SERVICE includes the provision of the materials necessary for the SERVICE as defined in Appendix II, and special tools, as well as measuring devices required for the SERVICE, and the wage costs for work and travel time, travel costs, daily allowances and accommodation costs for the SERVICE PROVIDER's personnel during BUSINESS HOURS. 2.3 SERVICE of the SERVICE PROVIDER that becomes necessary for the following described reasons is not the SERVICE PROVIDER's responsibility, not included in the scope, and is excluded from this CONTRACT, unless specifically described and included in Appendix II: 11 Page a. Events of force majeure such as, but not restricted to, theft, fire, natural events, industrial action, civil unrest, terrorism, epidemics and materials shortages; b. The breakdown or malfunction of the MODULE itself or MODULE parts & components that are not included in the scope of SERVICE, typically described as unscheduled maintenance, or unscheduled repairs; c. Wear and tear items and components that are not included in the scope of the agreed SERVICE to be performed under this CONTRACT; d. Necessary work with respect to property of the CUSTOMER other than the MODULE itself, or associated components connected to the MODULE; e. Temporary shut - down's of the MODULE or of parts of the MODULE by the CUSTOMER, and system stoppage not related to any service or equipment performance issues, and associated equipment preservation (engine mothballing) as required by manufacturer guidelines & recommendations; f. New or amended legal requirements with cost effects not known at the time the Contract was signed, imposed by government authorities; g. Improper operation and treatment of the MODULE or failure to adhere to the instruction manuals, manufacturer guidelines, operator mistakes, neglect, including but not limited to: faulty assembly or putting into operation contrary to the instructions of the manufacturer and /or SERVICE PROVIDER; Installation of spares other than OEM parts provided by the SERVICE PROVIDER; use of unsuitable operating materials & consumables, improper preparation of operating materials & consumables, and failure to adhere to the specifications for operating materials & consumables. h. Improper fuel and treatment of such, if required. Failure to adhere to the manufacturer's fuel guidelines, instructions, and recommendations. Oil analysis is required every 250 operating hours, tri- yearly full spectrum gas analysis is required before and after the gas conditioning equipment (two samples), and regular (minimum weekly) monitoring and recording of HAS and CH* levels must be maintained to determine when the carbon media is no longer suitable for use; i. Breach of the duty to cooperate and the duty to render assistance in accordance with Section 7, as well as other negligence or misconduct of the CUSTOMER or third parties under the CUSTOMER's control; j. Converting and retrofitting the MODULE, or unauthorized modifications; and k. Physical obstacles to access the MODULE or other obstacles to rendering SERVICE 3. Time of Performance 3.1 The SERVICE PROVIDER undertakes to carry out the SERVICE in the intervals set forth in Appendix Il, in accordance with the following: a. The CUSTOMER will notify the SERVICE PROVIDER weekly by fax or by e-mail about the MODULE operating hours incurred, unless the CUSTOMER selected the "Monitoring Option" and SERVICE PROVIDER has online access to the MODULES' electronic monitoring system; and b. The SERVICE PROVIDER will coordinate the date for commencement of work with the CUSTOMER no later than 10 days before work commences. 2 1 P a g e 3.2 Should the commencement or the performance of the SERVICE be delayed by force majeure, such as, but not restricted to, theft, fire, natural events, industrial action, civil unrest, terrorism, epidemics and materials shortages or by the occurrence of other circumstances outside the SERVICE PROVIDER's control, the period that the SERVICE PROVIDER has in which to begin or provide the SERVICE shall be extended by this period. Should SERVICE PROVIDER be in default with a Contractual obligation, the default situation shall be suspended for the duration of the force majeure event. In the event of an embargo, the Contractual obligations shall be suspended and the parties shall renegotiate the CONTRACT. 3.3 If the CUSTOMER fails to meet an agreed appointment to carry out the SERVICE, if access to the MODULE is denied, or otherwise delays SERVICE, the CUSTOMER shall be charged separately for the additional costs incurred by the SERVICE PROVIDER as the result of the delay, unless the CUSTOMER has cancelled the appointment at least 48 hours in advance. 3.4 All work is provided during normal BUSINESS HOURS (08:00 to 17:00) on workdays (Monday to Friday). For all work performed outside normal BUSINESS HOURS (if requested by the CUSTOMER), or during weekends or public holidays, an overtime charge in accordance with SERVICE PROVIDER's standards and industry rules shall be applied. Overtime and after normal business hours (08:00 to 17:00 EST), Definitions and rates as follows: Standard Labor rate is $115 USD Standard Travel rate is $98 USD • Overtime is: greater than 8 hours in the same work day or work event (excluding travel). • Overtime is invoiced at 1.5 x the standard rate. • Afterhours is all time from 17:00 to 08:00 EST, weekends and Holidays excluded. • Afterhours rates shall be invoiced at 1.5 x the standard rate. • Saturday's 1.5 x the standard rate for the first twelve (12) hours (excluding travel). • All labor hours over twelve (12) hours are invoiced at 2.0 x the standard rate (excluding travel). • Sundays and US National Holidays are invoiced at 2.0 x the standard rate (excluding travel). 4. Services to be Performed 4.1 The CUSTOMER has chosen to select the Bronze service plan with No Overhaul Option and a Maximum of TWO (2) carbon media changes per year at an agreed rate of $3.00 per estimated 8000 MODULE operating hours. The SERVICE to be performed and all agreed service measures concerning the MODULE, are described and set forth more particularly in the List of Services and Schedule of Maintenance Levels attached to this CONTRACT as Appendix II, and incorporated herein. 4.2 SERVICE PROVIDER shall be entitled to wholly or partially transfer their entitlements and /or obligations from this CONTRACT to an authorized third party or an associated company of SERVICE PROVIDER by means of assignment or commissioning, provided that SERVICE PROVIDER obtains CUSTOMER'S prior written consent. CUSTOMER shall be entitled at any time by notice in writing to (but without the consent of) Seller to assign or delegate the whole or any part of its rights and obligations under this Agreement to: (i) any affiliate or to any successor in title which acquires all of CUSTOMER's interest in the MODULE or (ii) any bank or other lender, or to any trustee or agent acting on behalf of such lender to whom CUSTOMER provides a security interest in CUSTOMER's right, title and interest in the MODULE. 4.3 Following each service visit, SERVICE PROVIDER shall submit to CUSTOMER a written report on the inspection and work performed. Moreover, the report shall indicate, if necessary, any additional repairs needed (not covered under the standard service schedule) and /or parts to be replaced with their cost estimate. As a courtesy, SERVICE PROVIDER shall, at all times, give proper verbal and /or written instructions to the CUSTOMER's personnel concerning the maintenance and operation of equipment between the regular maintenance intervals. 3 1 P a g e 5. Services Rendered and Warrantv Claims 5.1 The services performed by the SERVICE PROVIDER in the context of this CONTRACT shall be considered to have been rendered provided that the CUSTOMER does not notify SERVICE PROVIDER of defects or inadequate provision of SERVICE without delay, no later than five (5) calendar days after CUSTOMER becomes aware of such defects or inadequacies. The SERVICE carried out and its completion shall be documented in the SERVICE PROVIDER's technician's service report. The CUSTOMER or his representative shall receive a copy of this report immediately, on -site after completion of work. 5.2 If, in the opinion of the CUSTOMER, the provision of SERVICE does not fulfil acceptance requirements, CUSTOMER must inform SERVICE PROVIDER in writing of the claimed defect immediately, no later than five (5) calendar days after becoming aware of such defect. SERVICE PROVIDER thereupon arranges to have defects, for claims with merit, repaired at its own expense. 5.3 The SERVICE PROVIDER warrants that all SERVICE shall be provided with professional workmanship. Defects in the SERVICE, resulting in damages to the CHP Module, due to (or proven to have derived from in whole or in part by) defects in the material supplied by the SERVICE PROVIDER and /or work performed by the SERVICE PROVIDER, shall be remedied and repaired by the SERVICE PROVIDER to the exclusion of any further claims by the CUSTOMER and as the CUSTOMER's sole remedy at law or in equity. It is the responsibility of both the SERVICE PROVIDER and the CUSTOMER to act in a good faith manner in efforts to resolve any and all service warranty disputes for the remaining term of this agreement. In the event of a warranty claim, the CUSTOMER is responsible for providing to the SERVICE PROVIDER any and all required forms, documentation, or performance data in accordance with the manufacturer's warranty requirements (O &M information, product documentation, and /or warranty terms, etc.) for warranty repair /review by the SERVICE PROVIDER. Please Note: Failure to provide operational data and /or supporting documentation in accordance with the manufacturer's warranty requirements (O &M information, product documentation, and /or warranty terms, etc.) and or 2G Energy, Inc. requests, may result in the CUSTOMER's existing warranty and /or current or future warranty claim being voided and /or denied. This Service Agreement shall not cover any damages or repairs of the exhaust system, exhaust heat recovery system, and or any components of said system(s). Disposal of spent Carbon Media will be the sole responsibility of the CUSTOMER. Upon acceptance of a warranty claim, it is the responsibility of the SERVICE PROVIDER to work in conjunction with the CUSTOMER to resolve /repair all warranty claims in a timely and professional manner. The aforementioned warranty claims shall expire: a. For parts, either one (1) year after initial commissioning, or eighteen (18) months after the delivery date; whichever comes first. b. For work, one (1) year after the work has been completed. However, all warranty claims expire at the latest one (1) year after the expiry or termination of the present contract. 5.4 Of the direct costs arising from the repair, the SERVICE PROVIDER shall — insofar as the complaint proves to be justified — bear the cost of the replacement part inclusive of shipment and reasonable dismantlement and installation costs, and including the costs of making its technicians and /or subcontractors available. All other Costs, in the event the complaint is not justified, shall be borne by the CUSTOMER. 4 1 P a g e 5.5 The SERVICE PROVIDER shall be informed immediately in writing of the discovery of any visible defects. Replaced parts shall become the property of the SERVICE PROVIDER. After consulting the SERVICE PROVIDER, the CUSTOMER shall provide the necessary time and opportunity to carry out all repairs that, at the SERVICE PROVIDER's reasonable discretion appear to be necessary; otherwise, the SERVICE PROVIDER shall be released from liability for defects. Only in urgent cases endangering operational security and to ward off disproportionately large losses, whereby the SERVICE PROVIDER shall be notified immediately, or if the SERVICE PROVIDER is in default for failing to remedy the defect, shall the CUSTOMER have the right to repair the defect itself or to have it repaired by third parties and to demand reimbursement from the SERVICE PROVIDER in respect of reasonable costs. If CUSTOMER does not notify SERVICE PROVIDER in a timely manner of an obvious defect, the defective work shall be deemed to be accepted and CUSTOMER waives any rights and remedies with regard to the defect. 5.6 SERVICE PROVIDER shall not be responsible for losses due to defects in the SERVICE, including faults in the material supplied by the SERVICE PROVIDER, arising for the following reasons, where such reasons lie outside the control of the SERVICE PROVIDER: Faulty assembly by operator and /or putting into operation contrary to the instructions of the manufacturer or SERVICE PROVIDER; Improper operation and treatment of the MODULE or failure to adhere to the instruction manual; Faulty repairs of breakdowns or damages to the MODULE by the CUSTOMER, his operators, or third parties; Installation of spares other than original parts of or from the SERVICE PROVIDER; Natural wear and tear; Improper preparation of operating materials and failure to adhere to specifications for operating materials as set out in the manufacturer and operators manuals; and chemical or electrical influences, especially influences caused by the electrical grid. In addition, CUSTOMER shall indemnify and hold harmless SERVICE PROVIDER against all claims by third parties arising out of the use of material provided by CUSTOMER. 5.7 EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH ABOVE IN THIS SECTION 5, THE SERVICE PROVIDER IS MAKING NO OTHER WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE SERVICE OR MATERIALS PROVIDED AS A COMPONENT OF THE SERVICE, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. 6. Limitations on Damages NOTWITHSTANDING ANY CONTRARY PROVISIONS CONTAINED HEREIN, (A) IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR LOSS OF PROFITS OR OTHER CONSEQUENTIAL, INCIDENTAL OR SPECIAL DAMAGES ARISING FROM ANY CLAIM OR ACTION HEREUNDER, WHETHER BASED ON CONTRACT, TORT OR OTHER LEGAL THEORY; (B) IN NO EVENT SHALL SERVICE PROVIDER BE LIABLE TO CUSTOMER FOR DAMAGES FOR ANY CAUSE WHATSOEVER IN AN AMOUNT IN EXCESS OF THE AMOUNTS PAID TO SERVICE PROVIDER DURING THE PRECEDING THREE (3) MONTHS UNDER THIS CONTRACT. 7. Collaboration and the Provision of Technical Assistance by the CUSTOMER 7.1 The CUSTOMER shall support the SERVICE PROVIDER in providing facilities and operator personnel at its own expense, in particular the provision of assistants (system operator), resources, parking spaces, storage areas, changing and washing facilities, electricity, water and compressed air, including the necessary connections available to be used by SERVICE PROVIDER. 7.2 The operation of the MODULE and the remedying of minor malfunctions or repairs of the MODULE, which do not affect the safe operation of the MODULE shall be carried out by the CUSTOMER's operators. Other work to be carried out by the CUSTOMER shall be listed in the specification and schedule of services, Appendix II. 7.3 The CUSTOMER shall ensure that its personnel entrusted with carrying out the aforementioned work in accordance with the manufacturer's guidelines & regulations for the MODULE receive the necessary training, and are capable, qualified, and properly prepared to perform operator duties. 51 Page 7.4 The CUSTOMER undertakes to adhere to the operating instructions and other provisions of the MODULE manufacturer. 7.5 SERVICE PROVIDER's personnel shall be given access to the MODULE to provide the SERVICE following prior notification by the SERVICE PROVIDER. 7.6 The CUSTOMER shall provide the SERVICE PROVIDER with any information SERVICE PROVIDER requires on the MODULE, where such information is necessary for providing the SERVICE, and shall make the associated documents like operators log's, etc. available. 7.7 The CUSTOMER shall take such special action as is necessary to protect persons and property at the area surrounding the MODULE. The Customer shall also inform the SERVICE PROVIDER's personnel of existing special safety regulations applicable on -site, where these are pertinent to the SERVICE PROVIDER's personnel. The CUSTOMER shall notify the SERVICE PROVIDER of any infringements by the SERVICE PROVIDER's personnel of such safety regulations. 7.8 The CUSTOMER shall grant the SERVICE PROVIDER unrestricted online access to the MODULE's control systems via the appropriate on -line data, phone, or Internet connection. 7.9 Should fuel analyses be prescribed in accordance with Appendix II, the CUSTOMER shall make these available to the SERVICE PROVIDER as soon as they have been prepared. 8.Insurance 8.1 The SERVICE PROVIDER shall comply with the insurance requirements as outlined in Appendix III for the term of the CONTRACT and for at least 6 months thereafter. 9. Payments 9.1 CUSTOMER shall issue an ANNUAL PURCHASE ORDER at the beginning of each CALENDAR YEAR for the SERVICE described and agreed upon in Appendix II. The initial term of the CONTRACT will begin on ' , 2015. This contract will run through 30 June 2016, and will then renew each year thereaftef on 1 July. The CUSTOMER agrees to issue a PURCHASE ORDER for this first term at an estimated 6830 operating hours. The estimated value of this term, for the agreed and selected SERVICE PLAN and OPTIONS in Appendix II, is $20,500.00 USD. The CONTRACT will then renew with a PURCHASE ORDER issued on or before 1 July 2016. The value of this PURCHASE ORDER shall be based off of the selected SERVICES from Appendix II plus the CPI increase (see 10.3). The CONTRACT is estimating that the MODULE will operate for at least 8000 hours per CONTRACT year. In the event that the MODULE operates more than 8000 hours during a CONTRACT year, the purchase order for the following CONTRACT year will reflect this additional increase. Should the MODULE under - perform during any given CONTRACT year (less than 8000 operating hours), the monetary value of the remaining balance owed the CUSTOMER will be consumed until the CUSTOMER has received the full monetary value of that CONTRACT year. Following an event such as this, the following CONTRACT year will only be invoice at the estimated 8000 operating hours. 9.2 All invoices and amounts are payable net 30 days after date of invoice. A 1.5% finance charge will be added to all accounts over thirty (30) days for every 30 day period. If CUSTOMER does not pay its account within latest (60) days of the date of the invoice, then SERVICE PROVIDER may cancel the CONTRACT Agreement upon five (5) days prior written notice (unless payment is made within such five (5) day period. 9.3 Additional charges for rendering the SERVICE that become necessary as a result of: a. the events listed in Sections 2 and 3 of this CONTRACT, or 61 Page b. the provision of SERVICE by the SERVICE PROVIDER requested by the CUSTOMER outside the SERVICE PROVIDER's normal BUSINESS WORKING HOURS (Monday through Friday from 08:00 — 17:00); will be charged additionally to the CUSTOMER based on the SERVICE PROVIDER's existing current parts price lists and labor rates. 9.4 The CUSTOMER shall not, under any circumstances, be entitled to holdback any amounts due to SERVICE PROVIDER or otherwise attempt to set -off against amounts due to SERVICE PROVIDER based on claims against SERVICE PROVIDER for failure to perform hereunder of any other claims against SERVICE PROVIDER. 9.5 In the event that the CUSTOMER has an outstanding balance exceeding 45 calendar days from the original date of invoice, the SERVICE PROVIDER, at its sole discretion, may discontinue any further service requests of the CUSTOMER until any outstanding balance(s) exceeding 45 calendar days from the original date of invoice are paid in full. 10. Terms of the Contract and Right of Termination 10.1 The term of this CONTRACT agreement shall be from the date which the contract is signed through June 30th, 2016. The following years the contract with run from July 1St through June 30th. 10.2 The term of this CONTRACT agreement shall be in conjunction with the dates specified above. The anniversary of the CONTRACT, after the i n i t i a l period of commercial operation of the MODULE, shall be automatically renewed for an additional one (1) year period, and from year to year thereafter (subject to a maximum term of ten (10) years from the commencement of commercial operation of the MODULE), unless either CUSTOMER requests termination in writing of this CONTRACT agreement at least Sixty (60) days prior to any expiration date. Nothing in this CONTRACT agreement shall be construed as a guarantee by SERVICE PROVIDER of any continued obligation of services after the expiration of this CONTRACT. 10.3 A 3.5% annual increase based on current inflation statistics, and at a minimum, 1 % above the official Consumer Price Index (CPI) which is compiled annually by the US Government, will be implemented at the time of each renewal to continue the current CONTRACT Agreement 10.4 If changes in legislation or regulations occur during the term of the CONTRACT, for instance in relation to waste disposal, etc., SERVICE PROVIDER is entitled to pass any resulting costs on to the CUSTOMER, where they are incurred due to SERVICES covered by this contract. 10.5 If general economic conditions change so considerably in comparison with those at the time of conclusion and signature of the CONTRACT, resulting in a situation that the prices or conditions are no longer acceptable to the SERVICE PROVIDER or the CUSTOMER, the CONTRACT shall be amended in consideration of the interests of both parties in order to take such changed circumstances into account. 10.6 Both contracting parties may reserve the right to cancel the CONTRACT prematurely for due cause, for example delay or refusal of payment by the CUSTOMER or repeated neglect of the contracting partner's contractual obligations. An extraordinary notice of cancellation may be issued at the end of each quarter in writing, with observance of a one -month period of notice. 11. Additional Work Clause 11.1 During the performance of scheduled maintenance inspections, should circumstances be discovered that require additional repairs to keep the equipment in a state of efficient operation, SERVICE 7 1 P a g e PROVIDER requests the right to perform such SERVICE work to a level "not to exceed" US$ 1,000.00 for labor and materials combined. Should any necessary repairs be estimated to exceed the established US$ 1,000.00 cap, SERVICE PROVIDER shall perform such work only after proper authorization granted by the CUSTOMER. 11.2 No work other than the maintenance outlined above will be performed without a separate estimate signed by the client before additional work will be performed. All necessary replacement parts will be genuine. Parts still covered by manufacturer's warranty will be replaced in accordance to manufacturer warranty guidelines & regulations. 12. Severability 12.1 If any of these provisions are determined to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remainder of these Terms shall be unaffected. Also there shall be substituted for the affected provision a valid and enforceable provision as similar as possible to the affected provision. 13. Modification orTermination 13.1 These terms and the specific CONTRACT provisions contained therein are the entire CONTRACT between the parties with respect to this CONTRACT. This cancels and supersedes all previous agreements, confirmations, and terms of sale, oral or written with respect to the subject matter hereof. No waiver or modification of these terms shall be binding upon the parties unless made in writing and signed by a duly authorized representative. 14. Governing Law and Jurisdiction 14.1 This CONTRACT Agreement and its exhibits (Appendix I and Appendix II) shall, unless otherwise specified, in all respects be construed and be given legal effect in conformity with the laws of the State of California, USA without regard to its choice of law provisions. SIGNED as a sealed instrument as of the hir 2G Energy, Inc. SERVICE PROVIDER By: Anthony Dawson Its: Servic Day of & i cOC-P, 2015 The City of San Luis Obispo Public Utilities CUSTOMER By: Howard Brewen Supervisor 81 Page Q Energy, Inc. EQUIPMENT TYPE: MODEL: ID NUMBER: SERIAL NUMBER: MODEL YEAR: CURRENT OPERATING HOURS: PRIME MOVER: RATING: 2G SERVICE AGREEMENT APPENDIX Combined Heat and Power System Filius 206 BG G3936 C00714C -BMLB- 150037 2014 — - - — YES 150 ekW FUEL TYPE: I Biogas EQUIPMENT LOCATION: 35 Prado Road, San Luis Obispo, CA 93401 -7314 CUSTOMER NAME: The City of San Luis Obispo Public Utilities ADDITIONAL COMMENTS & INFORMATION: SERVICE AGREEMENT INCLUDES TWO (2) CARBON MEDIA CHANGES PER YEAR MAXIMUM. L SIGNED as a sealed instrument as of the %Sf Day of a- Y-? 2G Energy, Inc. SERVICE PROVIDER By: Anthony Dawson Its: Service Dire r``� 1 2015. The City of San Luis Obispo Public Utilities CUSTOMER By: Howard Brewen Its: Water Resource Recovery Facility Supervisor 91 Page Energy, Inc. 2G Service Agreement Appendix II CUSTOMER has the Option to select a Service Level (Bronze, Silver, Gold, or Platinum). (Regular Oil Changes ' Oil 411 (Regular Oil Filter Changes Dil Filters (Regular Air Filter Changes Ll Air Filters (Regular Coolant Changes Coolant 4111 -to' (Regular Spark Plug Changes Spark Plugs ve !Exchanging Other Consumables Other Consumables 44, (Regular Oil Sampling Ve 'Scheduled Maintenance incl. Parts 'Unscheduled Maintenance incl. Parts Selecting the right Service Level Please carefully align your individual service -level requirements with your specific business expectations, and operational circumstances. All Service Levels include: • Customer Access to the 2G Portal with On -Line Monitoring for their Operators • Priority Help Desk Support (Whatever service level you select, you will receive first - class support. Your individual service level will determine additional support that is available to you.) • OEM Parts • Addition to our automated breakdown indicator, this alerts us in real time of a shutdown or equipment issue. • Logistics Support 101 Page CUSTOMER SCOPE SERVICE PROVIDER SCOPE CUSTOMER is responsible for SERVICE PROVIDER is responsible for 0 Scheduled Maintenance Duties and o All System Operator Duties and Basic Services as described below: Services as described below: • Oil Changes o MO to M4 Scheduled Maintenance as • Oil Filter Changes per Manufacturer Guidelines • Oil Sampling and Analysis incl. Reporting o Parts and Components for MO to M4 • Air Filter Changes • Gas Filter Changes o Maximum two (2) Carbon Media • Coolant Changes changes per year. Additional media • Spark Plug Changes changes, as determined by • General Changes of Consumables customer's fuel analysis, are not • All Consumable Parts and Components covered. Cost per Operating Hour: US$ 3.00 Anticipated Operating Hours per Year: 8,000 Equipment Rating: 150 ekW /h Cost per ekW /h generated: US$ 0.022 t Cent 2.2 CUSTOMER selected Service Level: BRONZE with NO overhaul options and two (2) carbon media changes per year. Customer must perform fuel analysis. SIGNED as a sealed instrument as of the /5> Day of tk1'&6b1_ 2015. 2G Energy, Inc. SERVICE PROVIDER By: Anthony Dawson Its: Service Director The City of San Luis Obispo Public Utilities CUSTOMER By: Howard Brewen Its: Water Resource Recovery Facility Supervisor 111 Page 2G 2G Energy, Inc. 2G Service Agreement Appendix III INSURANCE SERVICE PROVIDER shall provide Certificates of Insurance evidencing the following coverage: 1INSURANCETYPE AMOUNT DESCRIPTION General Liability: General Aggregate Limit Applies Per Project $1,000,000 Per Occurrence $2,000,000 General Aggregate $2,000,000 Products /Completed Operations Aggregate $1,000,0.00 Personal &Advertising Injury $5,000 Medical Payments Auto Liability $1,000,000 Combined Single Limit Liability for Owned, Hired and Non -Owned Automobiles Workers Compensation Statutory Employers Liability: $1,000,000 Bodily Injury By Disease, Each Employee $1,000,000 Bodily Injury Each Accident $1,000,000 Bodily Injury By Disease, Policy Limit Umbrella Liability $5,000,000 Per Occurrence /Annual Aggregate All policies must be with Best's "A - "or better rated insurance carriers SIGNED as a sealed instrument as of the %51 Day of Oel?v t , 2015 2G Energy, Inc. SERVICE PROVIDER By: Anthony Dawson Its: Service Director The City of San Luis Obispo Public Utilities CUSTOMER By: Howard Brewen Its: Water Resource Recovery Facility Supervisor 121Page Exhibit B CONTRACT PERFORMANCE TERMS - 2G ENERGY, INC. _ :sty 43 ,:r ► t. , � x, a, �x � [a:.�"� '»i' 1 ;a. "'i n"t -mss }:� *- rX � u+:.s.M' *b �°Lf�. ±.i Business Tax. Contractor must have a valid City of San Luis Obispo business tax certificate prior to execution of the contract. Additional information regarding the City's business tax program may be obtained by calling (805) 781 -7134. 2. Ability to Perform. Contractor warrants that it possesses, or has arranged through subcontracts, all capital and other equipment, labor, materials, and licenses necessary to carry out and complete the work hereunder in compliance with any and all federal, state, county, city, and special district laws, ordinances, and regulations. 3. Laws to be Observed. Contractor shall keep itself fully informed of and shall observe and comply with all applicable state and federal laws and county and City of San Luis Obispo ordinances, regulations and adopted codes during its performance of the work. 4. Payment of Taxes. The contract prices shall include full compensation for all taxes that Contractor is required to pay. Permits and Licenses. Contractor shall procure all permits and licenses, pay all charges and fees, and give all notices necessary. 6. Safety Provisions. Contractor shall conform to the rules and regulations pertaining to safety established by OSHA and the California Division of Industrial Safety. 7. Public and Employee Safety. Whenever Contractor's operations create a condition hazardous to the public or City employees, it shall, at its expense and without cost to the City, furnish, erect and maintain such fences, temporary railings, barricades, lights, signs and other devices and take such other protective measures as are necessary to prevent accidents or damage or injury to the public and employees. 8. Preservation of City Property. Contractor shall provide and install suitable safeguards, approved by the City, to protect City property from injury or damage. If City property is injured or damaged as a result of Contractor's operations, it shall be replaced or restored at Contractor's expense. The facilities shall be replaced or restored to a condition as good as when the Contractor began work. 9. Immigration Act of 1986. Contractor warrants on behalf of itself and all sub - contractors engaged for the performance of this work that only persons authorized to work in the United States pursuant to the Immigration Reform and Control Act of 1986 and other applicable laws shall be employed in the performance of the work hereunder. M Contractor Non - Discrimination. In the performance of this work, Contractor agrees that it will not engage in, nor permit such sub - contractors as it may employ, to engage in discrimination in employment of persons because of age, race, color, sex, national origin or ancestry, sexual orientation, or religion of such persons. H. Work Delays. Should Contractor be obstructed or delayed in the work required to be done hereunder by changes in the work or by any default, act, or omission of the City, or by strikes, fire, earthquake, or any other Act of God, or by the inability to obtain materials, equipment, or labor due to federal government restrictions arising out of defense or war programs, then the time Exhibit B: Contract Performance Terms — South Coast Systems, Inc. Page B -2 of completion may, at the City's sole option, be extended for such periods as may be agreed upon by the City and the Contractor. 12. Payment Terms. The City's payment terms are 30 days from the receipt of an original invoice and acceptance by the City of the services provided by Contractor (Net 30). 13. Inspection. Contractor shall furnish City with every reasonable opportunity for City to ascertain that the services of Contractor are being performed in accordance with the requirements and intentions of this contract. All work done and all materials furnished, if any, shall be subject to the City's inspection and approval. The inspection of such work shall not relieve Contractor of any of its obligations to fulfill its contract requirements. 14. Audit. The City shall have the option of inspecting and /or auditing all records and other written materials used by Contractor in preparing its invoices to City as a condition precedent to any payment to Contractor. 15. Interests of Contractor. Contractor covenants that it presently has no interest, and shall not acquire any interest direct or indirect or otherwise, which would conflict in any manner or degree with the performance of the work hereunder. Contractor further covenants that, in the performance of this work, no sub - contractor or person having such an interest shall be employed. Contractor certifies that no one who has or will have any financial interest in performing this work is an officer or employee of the City. It is hereby expressly agreed that, in the performance of the work hereunder, Contractor shall at all times be deemed an independent contractor and not an agent or employee of the City. 16. Hold Harmless and Indemnification. Contractor agrees to defend, indemnify, protect and hold the City and its agents, officers and employees harmless from and against any and all claims asserted or liability established for damages or injuries to any person or property, including injury to Contractor's employees, agents or officers which arise from or are connected with or are caused or claimed to be caused by the acts or omissions of Contractor, and its agents, officers or employees, in performing the work or services herein, and all expenses of investigating and defending against same; provided, however, that Contractor's duty to indemnify and hold harmless shall not include any claims or liability arising from the established sole negligence or willful misconduct of the City, its agents, officers or employees. 17. Contract Assignment. Contractor shall not assign, transfer, convey or otherwise dispose of the contract, or its right, title or interest, or its power to execute such a contract to any individual or business entity of any kind without the previous written consent of the City. 18, Termination. If, during the term of the contract, the City determines that Contractor is not faithfully abiding by any term or condition contained herein, the City may notify Contractor in writing of such defect or failure to perform; which notice must give Contractor a 10 (ten) calendar day notice of time thereafter in which to perform said work or cure the deficiency. If Contractor has not performed the work or cured the deficiency within the ten days specified in the notice, such shall constitute a breach of the contract and the City may terminate the contract immediately by written notice to Contractor to said effect. Thereafter, neither party shall have any further duties, obligations, responsibilities or rights under the contract. In said event, Contractor shall be entitled to the reasonable value of its services performed from the beginning date in which the breach occurs up to the day it received the City's Notice of Termination, minus any offset from such payment representing the City's damages from such Exhibit B: Contract Performance Terms — South Coast Systems, Inc. Page B -3 breach. "Reasonable value" includes fees or charges for goods or services as of the last milestone or task satisfactorily delivered or completed by Contractor as may be set forth in the Agreement payment schedule; compensation for any other work, services or goods performed or provided by Contractor shall be based solely on the City's assessment of the value of the work -in- progress in completing the overall workscope. The City reserves the right to delay any such payment until completion or confirmed abandonment of the project, as may be determined in the City's sole discretion, so as to permit a full and complete accounting of costs. In no event, however, shall Contractor be entitled to receive in excess of the compensation quoted in its proposal. 19. Ownership of Materials. All original drawings, plan documents and other materials prepared by or in possession of Contractor as part of the work or services under these specifications shall become the permanent property of the City, and shall be delivered to the City upon demand. 20. Release of Reports and Information. Any reports, information, data, or other material given to, prepared by or assembled by Contractor as part of the work or services under these specifications shall be the property of City, and shall not be made available to any individual or organization by Contractor without the prior written approval of the City. 21. Copies of Reports and Information. If the City requests additional copies of reports, drawings, specifications, or any other material in addition to what Contractor is required to furnish in limited quantities as part of the work or services under these specifications, Contractor shall provide such additional copies as are requested, and City shall compensate Contractor for the costs of duplicating of such copies at the Contractor's direct expense. 22. Required Deliverable Products. Contractor will provide: a. 2 copies of the final report that addresses all elements of the workscope. Any documents or materials provided by Contractor will be reviewed by City staff and, where necessary, Contractor will respond to staff comments and make such changes as deemed appropriate. b. One camera -ready original, unbound, each page printed on only one side, including any original graphics in place and scaled to size, ready for reproduction. c. When computers have been used to produce materials submitted to the City as a part of the workscope, Contractor must provide the corresponding computer files to the City, compatible with the following programs whenever possible: • Word Processing Word • Spreadsheets Excel • Desktop Publishing Coreldraw, Pagemaker • Computer Aided Drafting (CAD) AutoCad Computer files must be on 31/2 ", high - density, write - protected diskettes, formatted for use on IBM - compatible systems. Each diskette must be clearly labeled and have a printed copy of the directory. 23. Attendance at Meetings and Hearings. As part of the workscope and included in the contract price is attendance by the Contractor at up to 2 public meetings to present and discuss its findings Exhibit B: Contract Performance Terms — South Coast Systems, Inc. B-4 and recommendations. Contractor shall attend as many "working" meetings with staff as necessary in performing workscope tasks. 24. Insurance. Contractor shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property that may arise from or in connection with the performance of the work hereunder by Contractor, its agents, representatives, employees or sub - contractors. a. Minimum scope of insurance. Coverage shall be at least as broad as: • Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001). • Insurance Services Office form number CA 0001 (Ed. 1/87) covering Automobile Liability, code 1 (any auto). • Workers' Compensation insurance as required by the State of California and Employer's Liability Insurance. • Errors and Omissions Liability insurance as appropriate to Contractor's profession. b. Minimum limits of insurance. Contractor shall maintain limits no less than: • General Liability: $1,000,000 per occurrence for bodily injury, personal injury and property damage. If Commercial General Liability or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. • Automobile Liability: $1,000,000 per accident for bodily injury and property damage. • Employer's Liability: $1,000,000 per accident for bodily injury or disease. • Errors and Omissions Liability: $1,000,000 per occurrence. C. Deductibles and self - insured retentions. Any deductibles or self - insured retentions must be declared to and approved by the City. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or self - insured retentions as respects the City, its officers, officials, employees and volunteers; or Contractor shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. d. Other insurance provisions. The general liability and automobile liability policies are to contain, or be endorsed to contain, the following provisions: • The City, its officers, officials, employees, agents and volunteers are to be covered as insureds as respects: liability arising out of activities performed by or on behalf of Contractor; products and completed operations of Contractor; premises owned, occupied or used by Contractor; or automobiles owned, leased, hired or borrowed by Contractor. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, official, employees, agents or volunteers. • For any claims related to this project, Contractor's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees, agents and volunteers. Any insurance or self - insurance maintained by the City, its Exhibit B: Contract Performance Terms — South Coast Systems, Inc. Page B -5 officers, officials, employees, agents or volunteers shall be excess of Contractor's insurance and shall not contribute with it. Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials.. employees, agents or volunteers. Contractor's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City. e. Acceptability of insurers. Insurance is to be placed with insurers with a current A.M. Best's rating of no less than ANII. Verification of coverage. Contractor shall furnish the City with a certificate of insurance showing maintenance of the required insurance coverage. Original endorsements effecting general liability and automobile liability coverage required by this clause must also be provided. The endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. All endorsements are to be received and approved by the City before work commences.