HomeMy WebLinkAbout1985-06-24 85-244 ORDER85-244
Introduced by Councilor case, June 7A, 1985
CITY OF BANGOR
QITLf) �l'�CT, Authorizing the City Manager to Enter into an Agreement
........ ........._._ ...1........ ............... _..
with Penobscot Energy Recovery Company - Solid Waste Disposal
............. ......._.. ..... __ . _. _.... _... ......
BY City Connell of W City OfDonser:
ORDERED,
THAT, WHEREAS, the City of Bangor has been actively engaged
in the search for a long-term solution to the problem of the disposal
of solid waste;.snd
WHEREAS, the City, through its membership in the Penobscot
Valley Solid Waste Project, hes participated in the preliminary_
planning for a waste -to -energy solid waste disposal facility; and
WHEREAS, said Penobscot Valley Solid Waste Project group has
conductednegotiations with the Penobscot Energy Recovery Company
for the construction and operation of a waste -to -energy facility
which would receive the solid waste from the area communities, and
has developed a Sinal draft of an Agreement for said disposal
which has been approved by said Penobscot Valley Solid Waste Project
group;
NOW,. Tfff.IiF;P'ORE, Be It
ORDERED, THAT the City Manager, 'acting for and on behalf of
the Municipal Officers of the City of Bangor, be and hereby is
authorized to enter into an Agreement with Penobscot Energy Recovery
Company, in conformance with a final draft dated June 7, 1985, a
copy of which is on file in the City Clerk's Office, said Agreement
to include a commitment for the delivery of at least 24,000 tons of
solid waste per year as the guaranteed annual tonnage of the City
of Bangor.
85-344
IN CIM COUNCIL 0 R D E Rny,
June 34, 1985 •V
Consider next meeting councilor ` q pj
beta' ing. MC rtxy. Title, gfyf0f �O
yFfi -
AYNopizing, the, City, Mapyget. to, Enter �LFRN o". ,
CITY
into an"Agreemxnr with'Penobacot Energy Recovery'
...................................... ..
in city (Recall duly 8,1985 Compairy -,s id. wa§teElepoaal.
emended and passed -i ed ft d_by
conancilor Ed Caahy abstained
Amended in the lest paragraph
Etre 8'M1000 taus to 35,00 -
te .Loan
city
cler
MEMORANDUM
July 5, 1985
To: Bangor City Council
Fr:: City Engineer
Re: Council Order 85-244 Solid Waste Disposal Agreement
I believe the City Manager previously forwarded to you a
Side Letter, which is a supplement to the proposed solid waste
agreement. The Side Letter has been revised in order to clarify
numerous items pertaining to the possible future formation of a
District. It does not change any of the terms of the agreement
-which was discussed at the Workshop Session on duly 2nd.
There will be a slight amendment to Council Order 85-244!:
in the last paragraph, the City's commitment will be changed from
24,000 tons to 25,000 tons per year.
J.T.F.-
jr
Attachment
cc: City Manager _
July 5, 1965
SIDE LETTER
Mr. John Flynn
City Manager
City of Bangor
Bangor City Ball
Bangor, Maine 04401
Re: PERI/JEPA
Dear John:
By this letter, I wish toconfirmcertain matters
1. 'Recover esentatives of the Penobscot Energy
Recovery Company ("PERC") have negotiated over the past
several months with representatives of a group of
Eastern Maine municipalities assembled under a Joint
Exercise of Powers Agreement ("JEPA") with a view
towards entering into a 30 -year put -pay agreement for
the delivery of a substantial amount of waste to a
este anergy facility (the "facility") to be built by
PERC in the greater -Bangor area. As a result of those
negotiations and subject to ratification )by the
participating municipalities, PERC and JEPA have agreed
to enter into a Put -pay agreement in the form of
Exhibit A attached to this letter (the "Put -Pay
Agreement") as soon
as the members of JEPA have formed
a district which has the legalauthority to make such a
contract and have committed to provide a substantial
quantity of waste to the facility for the duration of
the Put -Pay Agreement. Unless otherwise mutually
agreed, "substantial" shall mean at least 50,000 tons
annually on a guaranteed basis. Pending the formation
of that district, individual members of JEPA may
execute an interim basis put -pay agreements similar
n form to the Put -Pay Agreement which may be
superseded by the Put -Pay Agreement at such time as it
is duly executed. In the event that a charter member
Of JEPA executes a put -pay agreement and subsequently
elects net to join a district, its put -pay agreement
shall remain in full force and effect.
Mr. John Flynn
July 5, 1985
Page -2-
2. In order to provide an inducement for those
municipalities which were members in good standing of
JEPA as of July 1, 1985 ("charter JEPA members' as
designated on the attached list) to commit at an early
time t0 deliver waste to PERC's facility, PERC agrees
that the base tipping fee for Acceptable Waste which
any charter JEPA member contracts before September 1,
1985 to deliver to PERC's facility ("pre -September 1
Waste-) shall be :$10.00 per ton plus the amount of any
CPL adjustment,, regardless of whether a district is
formed.
Charter members of JEPA which contract between
September 1, 1985 and December 31, 1985 to deliver to
PERC's facility a specified quantity of Acceptable
Waste will pay a tipping fee for such Acceptable Waste
equal to the lesser of (i) $11 per ton, plus the amount
of any CPI adjustment or, (ii) the tipping fee set
forth in the Put -Pay Agreement provided such charter
member becomes a member of.the district.
( Non -charter members of JEPA which contract prior
to December 31, 1985 to deliver to PERC's facility a
specified quantity of Acceptable Waste shall pay a
tipping fee equalto the lesser -o£ -(i) $12.per ton,
Plus any CPL. adjustment or, (ii) the tipping fee set
forth in the Put -Pay AgreemeTt provided such
non -charter member becomes a member of the district.
Only those members of JEPA which agree to join a
district and which collectively take all political
actions necessary for such purpose prior to December
31, 1985, with the exception of obtaining legislative
approval, will be allowed to aggregate their Acceptable
Waste for the purpose of obtaining the benefits of the
tipping fee schedule set forth in the. Put-Pey
Agreement.
It is further agreed, however, that if the members
Of JEPA form a district and if the base tipping fee for
the waste delivered by such district under the tipping
fee schedule set forth in the Put -Pay Agreement is less
than $10.50 per .ton, the tipping fee for pre -September
1 Waste delivered by charter JEPA members shall be 50
cents less than the base tipping fee for such other
waste. The obligation of PERC to grant to charter JEPA
members a tipping fee of $10.00 per ton )or less) for
pre -September 1 Waste is conditioned upon PERC
receiving prior to September 1, 1985 written
Mr. John Flynn
July 5, 1985
Page -3-
commitments from the municipalities of Bangor, Brewer
and Old Town for the delivery to PERC's facility of a
aggregate amount of not less than 40,000 tons annually
of Acceptable Waste for a period of not less than 30
years. For purposes of satisfying the preceding
minimum amount of tonnage, PERC will credit any
Acceptable Waste originating within said
municipalities.
3. PERC will reserve until December 31; 1995 the
entire rated capacity ofits facility to process waste
(156,000 tons annually) for the mutual benefit of the
embers Of JEPA (and its successor district) and Sawyer
Environmental Recovery Facilities, Inc. and ,its
affiliates ("SERF") subject to the following
conditions:
a. JEPA and SERF must contract prior to August 1,
1985, to deliver an aggregate amount of waste of
not less than 50,000 tons annually to PERC's
facility for a period of 30 years.
b. JEPA and SERF must contract prior to October 1,
1985, to deliver 90,000 tons of waste per year to
PERC's facility inclusive of the amounts
stated in subparagraph a, above.
4. If prior to December 31, 1985, the members of
JEPA form a district and such district (exclusiveof
SERFI commits to deliver annually to the facility at.
least 50,000 tons of waste originating within the _
Wasteshed ("Wasteshed Waste") for a period of not leas
than 30 years, then no other municipality,
quasi -municipal corporation, other district or private
firm with the axception of SERF shall be charged a
tipping fee for delivery of Wasteshed Waste to the
facility which is as low as the tipping fee charged to
such district unless such other waste supplier
guarantees to deliver annually to the facility at least
50,000 tons of waste for a period of not less than 30
years. Notwithstanding the foregoing, the tipping fee
charged to SERF shall be equal in amount to the tipping
fee charged to such district. -.
S. In consideration of PERC agreeing to credit
the district to be formed by members of JEPA any waste
which originates within the Wasteshed and is delivered
Mr. John Flynn
July 51 1985
Page -4-
to PERC's facility by SERE for purposes of the tipping
fee schedule under the Put -Pay Agreement, n
restrictions shall be placed upon FERC with respect to
the amount which it may charge any person, including a
municipality, for waste which originates outside of the
Wasteshed and is delivered to its facility.
6. PERE will attempt t0 obtain aeof
n
subrogation clause i any insurance Policies which it
may purchase for its facility waiving the right of the
insurer to proceed against JEPAas subrogee of PERC,
Provided JEsu pays any incremental premium cost on
count of such waiver.
If this letter accurately reflects our
understanding, Please execute the counterpart of it on
the space provided below and return it to the
undersigned.
very truly yours,
'COMPANY _ I I PENOBSCOT ENERGY RECOVERY
CITY OF BANGOR
Enclosures
Charter, dEPA Members
9/1/05
Attachment to Side Letter
Guilford
Hermon
Bangor
Bolden
Bar Harbor
Levant
Brad Le}' -
Lucerne -in -Maine
Brewer
Maxfield
Brownville
Milo
Bucksport _
Newport
Corinna
old Town
Dexter
,Orono
Eddington
Winterport
Glenburn
Greenbush
APPENDIX B
GUARANTEED ANNUAL TONNAGE
The MUNICIPALITY Of guaranteea to deliver
tons Of Acceptable Waste to the COMPANY'S Facility
n Orrington or designated Bypass Waste site on an annual basis
beginning on the Commencement Date of Operations unless otherwise
specified in the contract.
Guarantee Date
Estimate of Tonnage Deliveries on a MonthlyBasis
Based on seasonal variation in tonnage the following monthly
tonnage deliveries are expected.
Tonnage
January
February
March
April
May
June
July
August
September
October
November
December
/ PINAL DRAFT
t.. T June.1985
This Agreement is entered into in the State of Maine by and between
Maine, a municipal- corporation hereinafter called -
"MUNICIPALITY," and,Penobscot Energy Recovery Company, '.hereinafter
called "COMPANY"; -
WHEREAS, the MUNICIPALITY is in 'need of a -comprehensive,
environmentally sound, reliable, long-term.—management strategy for
Y' handling the present and projected volumes of non -hazardous solid waste'
- -. generated within the MUNICIPALITY;
WHEREAS_ it is the policy of the State of -Maine to reducethe volume
of solid waste going into landfills and to'mazinTlze resource recovery; -
WHEREAS, improved waste management within the region"of -which
the MUNICIPALITY is a part will serve the following goals:
1. Recovery of energy from waste; -
2. Reduction in indiscriminate disposal of waste; -
3- Coordination of solid waste management among - political
subdivisions; -
4. Orderly and deliberate development of financially secure 'waste
facilities;
WHEREAS, State law requires each municipality to provide for
disposal facilities for domestic and commercial non -hazardous solid waste
generated within such municipality;
WHEREAS, solid waste issues present communities with serious
long-term financial, management, governmental and technical problems in
the disposal of solid waste;
WHEREAS, effective management of -solid_ waste is crucial to the
continued financial well-being of the MUNICIPALITY and the region of
which it is a part;
-2-
WHEREAS, the MUNICIPALITY and numerous other municipalities in
this region havebeen engaged in extensive joint planning over the post
three years in accordance with'-an agreement entered into pursue" to.the
Interlocal Cooperation -Act this . of hs State, 'which planning effort has become
known as the Pen - - -
obzwt Valle Solid
III 'Y Waste Project; .
WHEREAS, it. is 'recognized ,that solutions �to the problems of
_. disposing of solid waste require a comprehensive -approach whichcan,best
be achieved through -a quasi-municipal district, commonly known as refuse
disposal district, empowered to ensure thesafe and efficient disposal of
certain solid waste- generatedwithin its boundaries; -
WHEREAS, the COMPANY is willing and able to design, finance,' -
construct; own and operate a-facility for the conversion of solid waste.
into energy in the Town of Orrington, Penobscot County, Maine.'
y supply
WHEREAS, the MUNICIPALITY is willing to assurstead
e the -drfi. . of
- specified quantities of solid waste to such a facility for a fixed period;
and
WHEREAS, ultimate lender and investor confidence in the financial
feasibility of such projects in this State must be fostered.
NOW, THEREFORE, the MUNICIPALITY and COMPANY do hereby
agree as follows: -
ARTICLE 1. DEFINITIONS
A. "Acceptable Waste" means Solid Waste, including all ordinary
household, municipal. institutional, w cial and industrial wastes which
consist primarily of combustible materials rexcept for the following (unless
Specially Permitted Waste): -
1. demolition or construction debris from building and roadway
Projects or locations.
-3-
2. liquid wastes or sludges.
3, abandoned or junk vehicles.
A. Hazardous Waste. - -
.. 5. dead animals or portions thereof or other pathological wastes.
6. water treatment residues. -
T. tree stumps. --
'8.. tannery sludge-
9. waste oil. - - --
.- 10. discarded "white goods" such as freezers, refrigerators, wash-
ing machines, etc. -
- 11. waste. which in the reasonable judgment of the COMPANY'S"
weigh station operator. based solely upon a visual inspection has
a BTU content of less than 4,000 BTU's per pound unless the
waste fails to meet the aforesaid BTU minimum requirement
solely because of the moisture content of such waste and such
moisture content is due to abnormally wet weather conditions.
Notwithstanding the above limitations, Acceptable.Waste shall include
Specially Permitted Waste.
B. "Agreement" means this Agreement (including Appendix A and -8
hereof) between, the MUNICIPALITY and COMPANY, as it may be amended
from time to time.
C. "Alternate Fuel"means oil, coal, natural gas, wood chips, other'
biomass, or any other fuel burned in the plant combustion unit as
supplement to Acceptable Waste.
D. "Back-Up Capacity" means a fully licensed sanitary landfill or
other fully licensed waste disposalfacilitylocated within a radius of 50
miles of the intersection of Union and Main Streets, Bangor, Maine in
• -4-
which
which the COMPANY has reserved on behalf of the MUNICIPALITY the
capacityto -
accept the MUNICIPA LITV's Acceptable Waste up to the
Guaranteed Plant Capacity Share for a period`of four years from the date
of a Termination of.Operations.
E.' "Back -Up Capacity Fee" means the fee to becharged by the
Company to the Municipality for Back -Up Ca
pa<ity.as provided in Article
VIII.
F. "Bypass Waste" means all Acceptable Waste which the -COMPANY
is required but is unable to accept at the Facility.
- G. "Change in Law" means those events described in Article XV
hereof.
H. "CompleEon of Finameans the date on which all a, the
funds required for ;he construction of the Facility'have been made avail-
able to the COMPANY, subject to such conditions and restrictions as are
usual and customary in the financing of projects of like kind.
I. "Commencement Date of Operations" means the earliest of (i) the
date upon which the operation of the Facility begins as specified in a
notice sent by COMPANY to MUNICIPALITY, 00 "Initial Date of Delivery"
as defined in a certain Agreement dated June 21, 1984 between ,the
COMPANY and Bangor Hydro -Electric Company as the same may be
amended, or (iii) January 1, 1988.
J. "COMPANY" means- Penobscot Energy Recovery Company,
Maine limited partnership, or any successor thereto or assign thereof as
Permitted by this Agreement
K. "Delivery Hours" means a minimum of not less than eight hours
per day Monday through Saturday, certain specified holidays excluded;
during which deliveries of Acceptable Waste or Alternate Fuel, will be.
-5 -
normally accepted at the Facility. Such hours shall be determined by the
COMPANY with due consideration to be given to the needs of the
MUNICIPALITY asdhey and the concerns of the Host'
Municipality. Delivery .Hours may be suspended by COMPANY due to a
Suspension of Operations, hazardous conditions or lawful orders to do so. --
L "District" means the refuse - disposaf district to be 'formed -
pursuant to Title 38. Maine flpvised.-Statutes Annotated; Chaptar.R]-
- consisting of those municipalities- which presently -comprise the Penobscot --
Valley Solid Waste Project and other municipalities within the Wasteshed
which join the Districton or before December 31, 1985 or such later -date
as the COMPANY may approve.
M.. "Facility" means the facility to be developed by the COMPANY
in accordance with the: outline specifications set forth' on Appendix A
attached hereto for the purpose of converting Acceptable Waste into
electrical and/or steam energy. -
N: "Farce Me'eure Event" means an act of God;- act of public
enemy, war, earthquake, storm, flood, strikes during the construction of
the Facility and other causes not reasonably within the control of any
Party invoking Article XVI for its benefits.- -
O. "Guaranteed Annual Tonnage" means the amount oftons per
Operating Year of Acceptable Waste (set forth in Appendix B) which
originateswithin its boundaries that the MUNICIPALITY guarantees to
deliver to the Facility.
P. "Guaranteed Plant Capacity Share" means the capacity of the
Facility to process Acceptable Waste delivered to the Facility. by or on
behalf of the MUNICIPALITY in an amount equal to 125% of the
MUNICIPALITY's Guaranteed Annual Tonnage in an Operating Year or
I
such greater amount as the COMPANY shall specify in writing to the
MUNICIPALITY.
"Hazardous Waste"as waste with Inherent properties which
make such waste dangerous to manage by ordinary means, in<lutling, -but
not limited to, chemicals, explosives, pathological .wastes, 'radioactive
wastes, toxic wastes and other wastes defined as hazardous at. any time
during the term of this Agreement by ,ihe.Sxate of Maine or the Resource
.._ Conservation and Recovery Act of 1976, as amended, or other Federal. -
State or local laws,- regulations, orders, or other actions promulgated or -
taken.with respect thereto. I_
_R. "Host Munic oal't means -the municipality in which the 'basic
components Of the Facility (i. e., tipping floor• shredder, boiler and
generator) are located. - - -
.. S "Licensed Hauler" means any entity or Person other than the
MUNICIPALITY which is licensed by the MUNICIPALITY to haul waste on
its behalf. -
T. "Operating" means a twelve (12) month period of Facility
operation beginning July ) and concluding June 30.
U. "Residue" means material (including, but not limited to, bottom
ash, fly ash, and solids from emission control equipment and Acceptable
Waste not able to be combusted at the Facility) remaining after processing
of Acceptable Waste at the facility.
V., "SERF" means Sawyer Environmental Recovery Facilities, Inc.
and any other business entity, including a corporation, parfnerehip,-and
Proprietorship which is under 'a common control with Sawyer
Environmental Recovery Facilities, Inc, or Waldron E. (Tom) Sawyer, Jr.
-7-
W. "Solid Waste" means non -hazardous solid materials with, insuffi-
cient liquid content to be free-flowing which are of no value to the imme-
diate source from which they emanate as evidenced by their disposal,
discard, or abandonment without consideration in return, including; but:
not limited to, rubbish, sludge from a wastewater treatment plant, scrap
_. materials, junk, and refuse, but excluding 'septic tank sludge and ag-
ricultural waste. The fact that, value may be derived from such solid
materials by recycling, reprocessing, or other method of resource recov-
ery shall have no bearing upon their classification as "Solid Waste."-
_
X. - "Specially Permitted Wast "eans Unacceptable Waste which the
COMPANY by written. addendum to this Agreement agrees to accept at the -
Facility to the extent that efficient operation of the Facility will permit,
subject to such conditions and limitations as may be imposed by 'the
COMPANY.
Y. 'Suspension of Operations" means the suspension of the Facili-
ty's operation, for a temporary period to allow for repairs, maintenance,
retrofitting, change oflaw modifications and regulatory compliance during
which the COMPANY is unable to accept delivery of Acceptable Waste at
the Facility. - "
Z. "Termination of Operation,means the termination of the Facili-
ty's operation with no apparent intention or ability to resume operation.
AA. "Tipcing Fee" means the payments required to be made by the
MUNICIPALITY .to the COMPANY for either processing Acceptable Waste at
the Facility or diverting Bypass Waste to another location at the
COMPANY's cost. - 1 11 - ""`
BB. "Unacceptable Waste" means all wastethatis not Acceptable
Waste.
-8 -
CC. "Wasteshed" means the territory encompassed by the following
six Maine counties: Penobscot,-Piscataquis, Knox, Waldo, Washington and
Hancock. -
-- ARTICLE II. REPRESENTATIONS WARRANTIES ANO' COVENANTS `.
A. COMPANY warrants and represents to the MUNICIPALITY the
-following:. -
1. It is f limited
Partnership duly -organized .and validly j
_existing under the laws of the State of Maine in good standing, and
authorized to do business under the laws of the State M Maine and'that it
has full power andauthority to execute and to enter into this Agreement
and is qualified to perform this Agreement in accordance with its terms. -
d. The execution and delivery of this Agreement has been
duly authorized by all 'appropriate actions of its General Partner (as !'
referred to below), and this Agreement constitutes the legal, valid and
binding obligation of the COMPANY enforceable in accordance with its
terms (except as enforceability may. be limited by applicable bankruptcy
or similar laws affecting creditors rights, and by application of equitable
principles if equitable remedies are sought).
3. The execution, delivery. and performance of this Agreement
will not violate any prevision of law, any order of any court or other
agency of government, the Agreement of Limited Partnership of COMPANY
or any indenture, material agreement or other instrument to" which COM-
PANY is new a party or by which it or any of its properties or assets is
bound, or be in conflict with, result in a breach of or constitute a de-
- _- fault (with due notice) -or the passage of -time -or -batt,) under any -such
indenture, agreement or other instrument, or result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever
upon any of the properties or assets of COMPANY. -
,-4. To the best of its knowledge,- there is no pending of
._ or threatened litigation
._ 9 governmental Proceedings which would adversely
,affect -COMPANY'S ability toundertakethe construction or-contem contemplated
<d
operation of the Facility or would--affect-its 'ability to perform, obligations
under this Agreement
5... Kuhr Technologies, Inc. ("KTI"), guarantors of the -COM-
, _PANY's obligations hereunder, -is a corporation duly incorporated under
the laws of the State of -New Jersey and is in good -standing in that state;
s qualified to do business in .the State of Maine; and has the power to
enter into and has duly authorized, by proper corporate action, the
-execution and Aelivery of this -Agreement in its capacity of guarantor.
The execution, -delivery and, performance of this Agreement will not
violate any provision of law, any order of any court o other agency of
government, the Articles of IncorporationorBy-laws or
-KTI or any
indenture, material agreement or other instrument to which KTI is now a
party or by which it or any of its properties or assets is bound, or be in
conflict with, result in a breach of, or constitute a default (with due
notice or the passage of time or both) under any such indenture, agree-
ment or other instrument, or result in the creation or imposition a any
--
her, charge or encumbrance of any nature whatsoever upon any'of the
Properties or assets of KTI. I-
6. COMPANY shall provide to MUNICIPALITY an opinion of its
- legal counsel to the effect of Paragraphsl through 5.
B. The MUNICIPALITY warrants and -represents to the COMPANY
each of the following: -
-10-
1. The execution and delivery of this Agreement has been
duly authorized by all appropriateactionsof its governing body, and this
Agreement constitutes the legal, valid. -and binding obligations upon it
enforceable in accordance with its terms (except _ as enforceability may be
limited by -applicable bankruptcy -or similar laws affecting creditors
rights, and'by application of equitable principles if equitable remedies ars -
sought).
-- 1. To the best, of its knowledge,there is no -pending- or
threatened litigation or governmental' -Proceedings which would affect-its
abilityability to perform its obligations under this Agreement
i
3. The. MUNICIPALITY shell provide to COMPANY an opinion
of its legal. counsel to the effect of Paragraphs 1 through 2.
ARTICLE ill. FACILITY OESIGN AND CONSTRUCTION; TIMING
A. The COMPANY shall design and construct the Facility in con-
. - formity with all applicable cede,, ordinances, laws and regulations, in
such -manner as it in -its sole discretion shall - determine and the
..'MUNICIPALITY shall not exercise any control over such matters. At the M1
time of Completion of Financing, the COMPANY shall furnish to the
MUNICIPALITY a study Prepared by an independent on firm
acceptable to those lenders who are providing the primary 'financing for {
the Facility and which states the opinion that the proposed Facility is
economically and technically feasible and will have the capacity to process Ili
500 tons per day of Acceptable Waste and to generate not less than 18
megawatts of electricity for the term of the Agreement. The Facility shall ai
be located in the Town of Orringtom, Maine. _ -
B. The COMPANY covenants with the MUNICIPALITY that it will
Proceed with the development of the Facility in a diligent, orderly, and
prudent manner. The MUNICIPALITY acknowledges that the ability of the
COMPANY to develop the Facility may be contingent upon factors outside
.. of the. COMPANY's� control (such as interest rates; tax laws, environ-
mental laws and legal intervention) which maydelay or prevent the devel-
opment of the Facility and that it would not bedent ru for the COMPANY '
p .'
to undertake ceftain kinds of work and to _incur certain kinds of oblige—
' tions until such contingencies have been satisfied.
_. C. .The-COMPANYshall achieve Completionof Financingfor-the'
Facility onor before July 1, 1986 provided that such date shall be auto-
matically extended up to six (6) months on account of any delay caused
,. by factors which are not solely Within thecontrol of the COMPANY and
which were, described and explained to . the MUNICIPALITY by the
COMPANY contemporaneously with their. occurrence. Upon Completion of
Financing, the COMPANY, shall immediately notify the MUNICIPALITY in
writing of such occurrence, and, if requested, shall provide to special
counsel for. the MUNICIPALITY. (1) -a certificate a the COMPANY's
independent accountant that Completion of Financing has occurred and (2)
copy of the documents that set forth the terms of such financing,
excluding any material of a technical nature which, if disclosed, might
compromise the COMPANY's trade. secrets, secret processes, or know-how.
The COMPANY further covenants- with the MUNICIPALITY that the
construction contract for the Facility shall require the construction
.contractor to complete construction of the Facility within thirty (30)
months from the date of Completion of Financing., __subject only to
extensions which are usual and ,customary in the construction .industry
xhat are approved by MUNICIPALITY, which approval shall not be
unreasonably withheld. If the COMPANY defaults in the performance of
a2-
the preceding covenants and such default is not waived by the
MUNICIPALITY, the MUNICIPALITY, at its -0ption, may terminate this -
Agreement. In the event- of such a default, the MUNICIPALITY in
addition to its, righttoterminate this Agreement shall have the following'
rights and remedies which shall be exclusive and in lieu of all other
..remedies or claims for damages: (i) its rights is a 'secured party under a
certain wnd(tional assignment of the COMPANY', right to sell'. six.
megawatts of.. electricity annually to Bangor -Hydro- Electric Company'
pursuant to an energy sales agreement between that utility and the
COMPANY dated June 21, 1984, and (ii) its rights as a conditional
assignee of any contract(s) for Back -Up Capacity, as may then exist.
ARTICLE 'IV. OPERATION OF THE FACILITY ,
A. COMPANY shall, on and after Commencement Date" of Do -
rations, except as otherwise expressly .provided for herein, either oper-
ate and maintain the Facility so as to be capable of receiving and com-
busting Acceptable Waste from the MUNICIPALITY in quantities up- to the
Guaranteed Plant. Ca r arrange a
Capacity Share o range for the disposal of such
Acceptable Waste in the manner provided herein for Bypass Waste.
'-
B. The COMPANY shall 'use reasonable efforts to maintain the
Facility in a manner which will minimize any adverse impact upon resi-
dents
eardents of the surrounding area, including the following:
(i) all waste and waste by products shall be screened from public
view by natural buffers or man-made barriers;
(ii) vehicular access to the Facility shall be restricted during
non -Delivery Hours;
the premises .of the Facility, except for storage areas, shall be -
kept reasonably free of litter and other debris other than in its -
.designated location; - - -
Ov) ,roads on the premises of the Facility shall be kept in good order
and repair.
C. The COMPANY shall accept Acceptable Waste at the Facility
during Delivery Hours ,only, ax ceps that if in the event of, a natural
disaster_ orother- emergency condition, the MUNICIPALITY requests
COMPANY to accept Acceptable Waste outside of Delivery Hours, the -
COMPANY shall make a reasonable -effort to accommodate the
MUNICIPALITY's request provided the MUNICIPALITY agreesto pay any
additionaloverhead expenses that the COMPANY may incur in
accommodating such request If the COMPANY determines that it is not
able to accommodate such request,. its determination shall be final- In
case of such a determination, the COMPANY will make a reasonable effort
to.. locate an alternative disposal or storage site for such Acceptable
Waste.
D. The marketing of energy products produced by the Facility,
including the pricing thereof, shall be sole and exclusive perogative of
the COMPANY.
- E. COMPANY shall be exclusively entitled to any benefits derived
from the sale of any materials it may recover from Acceptable Waste. -
F. COMPANY shall be :responsible for disposing of all Residue
generated by the Facility and all_Bypass—Vasta—except as otherwise
provided for in this Agreement but the MUNICIPALITY shall .bear -all -costs
of delivering waste to the Facility, including the costs of operating
transfer stations, and all costs of removing any significant quantities of
-14 -
Unacceptable Waste delivered to the Facility by the MUNICIPALITY or its
agents. -
ARTICLEY. WEIGHING ..
A. Except as otherwise provided herein, COMPANY shall install
and maintain for use by the Licensed Haulers and MUNICIPALITY, a
container and/or motor truckscale -(or scales) -to weigh all vehicles of up
to 75 feet in length delivering waste to the Facility fon 'disposal.
-.COMPANY shall provide for- regular -inspections of the"scale(s) by the
-appropriate public officials with" responsibility for certifying weights and
measures to. ensure their reasonable, accuracy, such }nspeMion to be
.conducted not less .than annually, anat such other times as the
MUNICIPALITY at its expense downs -necessary. COMPANY shall have
available portable backup scales --for use when installed scales are
inoperative.
B. Deliveries by the MUNICIPALITY shall be recorded separately.
The COMPANY.. and MUNICIPALITY shall -jointly establish reasonable �
Procedures to ensure proper vehicle identification and weighing of loads. �I
Unless otherwise agreed, each incoming and outgoing waste vehicle shall
be weighed with gross weight, time, and truck identification indicated o
a weigh record. The MUNICIPALITY, COMPANY and operator of eachI
weighed vehicle shall receive
COPY of the weigh ticket. Each weigh
ticket shall include at least the following information:
Date and Time
Hauler Code
Vehicle I.D. number
• Tons delivered (to nearest hundredth of a ton)
COMPANY shall retain all weigh tickets for a period of not 'less than one
year. The weigh records shall be used by COMPANY and MUNICIPALITY
s -a -basis for the calculations required herein and shall be verified at
-15 -
least annually. The MUNICIPALITY shall have the right to inspect the
COMPANY's weigh records upon 24 hours Prior written notice. Such
inspections shall be..conducted duringbusiness hours in such a manner a
to not unreasonably interfere with gatehouse operations.
C. .If all -weighing facilities are- inoperative or are being tested,
the COMPANY. shall estimate the quantity of "waste delivered on the basis
of truckvolumesand estimated data obtained through historical informs --
tion pertinent -to the MUNICIPALITY., These estimates shall take the
Place of actual weighing records during the -scale outage.
ARTICLE VI. DELIVERY OF WASTE TO COMPANY
A. The MUNICIPALITY .will use :its best efforts to "use to be
delivered. to the Facility in equipment of the general type specified i -
Appendix A all the Acceptable Waste collected by it and other Acceptable
Waste under its control up to its Guaranteed Plant Capacity Share and
Will adopt reasonable measures to prevent the disposal of Unacceptable
-Waste at the Facility. If necessary, in orderto ss cure delivery of it'i
Guaranteed. Annual Tonnage, the MUNICIPALITY willenact waste stream
control ordinances pursuant to Public Laws of Maine 1963, Chapter 380,
as amended, and shall designate the Facility as the energy recovery
facility to which all Acceptable Waste generated or created within The
MUNICIPALITY must be sent for processing. If the MUNICIPALITY is
unable to cause to be delivered to the Facility all Acceptable Waste under
its control up to its Guaranteed Annual Tonnage because such 'waste
stream control ordinances are determined to be invalid in whole or in part
by a court of competent jurisdiction and such invalidity cannot be cured
by the MUNICIPALITY so as to render them effective, then the
MUNICIPALITY shall be excused from such obligation, but only if and to
the extent that the MUNICIPALITY is unable to satisfy such obligation by
any lawful means without incurring substantial costs. Recycling and other
kinds of resource recovery may be permitted Without the COMPANY's
consent: (1) if they do not significantly reduce the BTU content of the
MUNICIPALITY's. Acceptable Waste or(2)if -the COMPANY is not then-
" combusting materials of the same general 'nature for the purpose of
generating electricity.
_. B. The MUNICIPALITY shall use its best efforts to cause to be
delivered to the Facility the Acceptable Waste per operating month as
shown on Appendix B.
C. All Acceptable Waste delivered to the Facility by the
_ MUNICIPALITY or its Licensed Haulers shall be credited towards its
Guaranteed Annual Tonnage. -
D. Upon Commencement Date of Operations of the Facility and
Hereafter for the duration of This Agreement, the MUNICIPALITY shall be
obligated to deliver Acceptable Waste to the COMPANY equal to its
Guar-anteed Annual Tannage. To the extent the MUNICIPALITY fails to
deliver the Guaranteed Annual Tonnage in any Operating year, iM1e
MUNICIPALITY shall 'pay to the COMPANY the damages specified in
Article VII. Only Acceptable Waste which originates from within the
MUNICIPALITY shall be delivered to the Facility'by the MUNICIPALITY or i
- --. --- its Licensed Haulers and, credited towards its Guaranteed Annual
Tonnage.
E. All Acceptable Waste shall become the property of the COMPANY
-- after it is delivered to the Facility.
-n -
ARTICLE VII. DETERMINATION OF TIPPING FEE
A. The MUNICIPALITY shall pay COMPANY 'a -Tipping -Fee per ton
(subject to adjustments as -indicated below) for each ton' of Acceptable
Waste, it causes to be delivered to the Facility or which is bypassed to an
- .. alternative waste disposal -facility at the direction of the COMPANY .after'
_ the Commencement Date of Operations.
- Subject to adjustment as hereinafter provided, the -Tipping Fee 'shall
be the lesser of (i) $10.00 per ton of Acceptable Waste or -(ii) $.W per
ton of Acceptable Waste less than the amount per ton of Acceptable Waste
charged as a -Tipping Fee by the COMPANY to any community, -
quasi-munigipalcorporation or other district or 'private firm within the
Wasteshed. which subsequent to, September .1, 1985 enters.nte a 30 year
PubpaY .agreement with the COMPANY with a fee schedule in -accordance
with the following table:
Aggregate
Guaranteed Annual
Tipping
Tonnage -
Less than 50,000 $12,00
More than 50,000 but less $11.0
than 75,000 -
More than ]5,000 but less $10.50 - than 100,000
More than 100,000 but less $10.00
than 125,000- -
I
More than 125,000 $ 9.50 !
The aggregate Guaranteed Annual .Tonnage utilized in determining .the
_. Tipping Fee shall include all, Acceptable Waste delivered. by SERF
originating within the Wasteshed as. well as all 'Acceptable ,Waste
originating within the communities signing such an agreement.
-18 -
Such payment shall be based on weight records which shall be tallied
and formulated into an invoice which will normally be submitted to the
MUNICIPALITY within 15 days fromthe and ,of each month. Each such
.payment shall be made within 30 days pf the receipt of said invoice.
Overduepayments shall bear. interest at the "prime rate" plus '2$, per
Year. The "prime rate" is the baserateon corporate loans at IargeU. S.
money center.commercial banks adjusted'as , of the first day of each month
'. during.the term Of this - - Agreement as published in
The Wall Street Journal.
.. Commencing on the July A next following the Commencement Date of
Operations and on each . subsequent July 1, for the first twenty (2o)
years following the Commencement Date .of Operations, the above Tipping
.Fee shall be adjusted Prospectively for the Operating Year beginning on
.such date in accordance with the following formula: -
TF = BF % CPI • (51CPIA - CPII)
CPI
Where
I
TF- = The Tipping Fee, as adjusted from time to time.
CPI = Consumer Pricg, IncipA for, Urban Wage Earners and
-" "' - ---Clericlil"Worriers in the Boston Area as
next preceding the Commencement Date of O f January 1
peratiops.
CPIA = Consumer Price Index for Urban Wage Earners and
Clerical Workers in the Boston area as of the January
1 next precedingx 1he effective date of the adjustment. --
BF = The base tipping fee as determined in paragraph A.
After the twentieth (20th) anniversary of the Commencement Date of
Operations, the tipping fee shall remain constant and there. shall be no
further adjustments to the tipping fee.
B. The COMPANY shall notify the MUNICIPALITY of an adjustment
in the Tipping Fee 60 days prior to the effective date of such adjustment.
nFL
C:. On an Operating Year basis, if the amount of Acceptable Waste
actually received from and credited. to the MUNICIPALITY at the Facility
is less than the,hsUNICIPALITY's Guaranteed AnduaL Tonnage (for reasons
other than a Suspension of Operations or'Termination -of Operations), the
MUNICIPALITYshallpay the COMPANY not
rater than the July 31 -nett
following the Operating Year in which such Guaranteed Annual TonnageI was, not delivered, an additional, fee forthe shortfall Wow -the
....Guaranteed- Annual -Tonnage equal to the sum of (i) the Tipping Fee
which the MUNICIPALITY would have paid to the COMPANY had such
shortfall been delivered by the MUNICIPALITY to the Facility 'during the
Operating Year in question and (ii) the COMPANY'4 cost ofPurchasing
alternate-fuel,.equal in BTU value to the shortfall; assuming a BTU value -y
of 4725 BTU's per pound, but only if and to the extent that such
shortfall- under this: paragraph results, from the MUNICIPALITY's failure to
direct to the Facility Acceptable Waste which is either under its control or
which it could place under .its control by the exercise -of its powers,
including the enactment of flow control ordinances.
For purposes of determining whether the MUNICIPALITY .has met its
Guaranteed Annual Tonnage, no credit shall be given to the
MUNICIPALITY for Acceptable Waste delivered to the Facility .during the
last month of the Operating Year in excess of 150% of the normal monthly -
-tonnage specified in Appendix B unless such excess Acceptable Waste is
actually processed by the Facility.
Notwithstanding anything in this Agreement _to the contrary,. the
MUNICIPALITY, for purposes of satisfying its Guaranteed Annual Tonnage
for a given Operating Year, may applyagainst such Guaranteed Annual
Tannage the amount of any "Excess Acceptable Waste". delivered to the
-20 -
Facility during such Operating Year by any other municipality within the
Wasteshed which has signed a 30 year put -pay agreement with the
COMPANY on terms similar to the Agreement provided such "Excess
Acceptable Waste" has not been previously applied and Proof of the
consent of the other municipality to such application is furnished to the
COMPANY. For purposes of this paragraph,;"Excess Acceptable Waste"
mea "Acceptable Wase" delivered to .the Facility (or bypassed to an
_ alternative disposalfacilityduring a Suspension of" Operation) in excess
of the Guaranteed Annual Tonnage of the municipality which caused such
Acceptable Waste to be delivered.
D. The. provisions of, thisAgreementrelatingto payment of Tip -
Ping Fees. Guaranteed, Annual Tannage and otherrequirementswhich are
based upon an annual basis shall be modified where necessary during the
first months of operation prior to the July 1 next following Commencement
of Operations so as to place the Facility on an Operating Year basis. All
such modifications shall be based upon the percentage of the year during
which the Facility operates prior to the July 1 following Commencement
Date of Operations (First Operating Period). For the First Operating
- Period all annually :based -requirements to be adjusted shall be multiplied
by a fraction, the numerator of which is the number of Operating Months
or fractions thereof during the First Operating Period, and the denomina-
tor of which is 12.
E. The Company may add a surcharge on the Tipping Fee imposed'
by COMPANY for Specially Permitted Waste provided that such surcharge
shall not exceed an amount necessary to offset the COMPANY's incre-
mental costs of handling and disposing of such Specially Permitted Waste
-21 -
and, if applicable, the lower BTU value of. such Specially Permitted t
Waste. I I.
F. If the COMPANY ceasee.house the Acceptable W to delivers I d
to If by the MUNICIPALITY'
as ..fuel f - the generation of electricity
because an alternative use of such Acceptable Waste is more economically
-beneficial to the COMPANY, then, if requested by the MUNICIPALITY, C
theamount of the Tippiog Fee, as determined under -this Article, shall be
renegotiated to reflect an equitable sharing of the econdinic benefits from
the alternative use of such Acceptable Waste, provided that in no event
shall the amount of the Tipping Fee be less than'6 .00 per ton.
ARTICLE VIII BACK-UP CAPACITY _
Upon request of the MUNICIPALITY, the COMPANY shall
Provide Back -Up Capacity at all times during the term of the Agreement.
The MUNICIPALITY shall pay a Back -Up Capacity Fee to the COMPANY
for providing Back -Up Capacity equal to 1254 of the cost thereof to the
COMPANY, as certified by the COMPANY. -
(B. If the COMPANY elects to provide such Back -Up. Capacity itself
and/or to contract with a third party for such capacity, the COMPANY
shall notify the MUNICIPALITY of -the projected costs, termsand
conditions thereof prior to either (1) implementing direct provision of
such capacity, Or (2) entering into a contract. The MUNICIPALITY shall
within thirty (30) days after receipt of such notice from the COMPANY,
notify the COMPANY in writing, of anyobjectionto the proposed form of
Back -Up Capacity; otherwise, the MUNICIPALITY shall be deemed to have
approved such proposal. "If -within' such period they MUNICIPALITY
Objects to such proposal, the COMPANY shall be relieved of its obligation
to Provide .Back -Up Capacity -unless the MUNICIPALITY proposes to the
-22 -
COMPANY alternative arrangements which are reasonably acceptable to the
COMPANY. I-
_,
C. The existence of Back -Up Capacity shall not relieve o "other-
' wise absolve the COMPANY from operating the Facility and making ads,
geate and separate provision for By -Pass Waste. The determination of
.whether to utilize Back -Up Capacity shall be 'solely within the discretion
Of the MUNICIPALITY.
If such Back -Up CaPaatY actually is utilized by the MUNICIPALITY
It Shall pay all tipping and related fees for such utilization unless .the
MUNICIPALITY and the COMPANY otherwise agree.
ARTICLE IX. UNACCEPTABLE AND HAZARDOUS WASTE
Unacceptable Waste shall be handled in the following manner: _
A. -The COMPANY's weigh station operator shall. have authority to'
reject all. loads of waste delivered to the Facility on behalf of the
MUNICIPALITY which have significant amounts of Unacceptable Waste.
The determination of the_ -
weigh .station operator or other agent of the
COMPANY, if made in good faith, shall be binding an the MUNICIPALITY.
COMPANY shall immediately notify the MUNICIPALITY of any rejected
-loads and .shall provide to it -particulars about the Licensed Hauler the
reason for rejection and the information on the weight ticket provided for
by Article V hereof, for that rejected load. The MUNICIPALITY shall
notify all Licensed Haulers delivering - wasteon its - behalf of what
constitutes Unacceptable Waste.
B.. The COMPANY shall not knowingly permit any delivery by any
.. ... ..person at the Facility or to the By -Paas Waste- landfills of Hazardous
Waste or Unacceptable .Waste. The COMPANY shall exercise reasonable
care in the identification and extraction from the waste stream of all
Hazardous Waste and Unacceptable Waste received at the Facility. If the
Probable source of the Hazardous Waste or Unacceptable Waste can be
identified as the MUNICIPALITY, the MUNICIPALITY shall either
immediately remove the such wastefrom the Facility or reimburse the
COMPANY for all vests i nred by the COMPANY. in the required
clean-up of such waste.
ARTICLE X. DISPOSAL OF RESIDUE AND BYPASS WASTE. -
_. The COMPANY. shall- provideatits cost a suitable waste disposal
-.. facility for Residue and Bypass Waste of the Facility which shall have the
capacity to accommodate quantity of Residue and Bypass Waste equal to
_the 'amount of Residue and Bypass Waste likely -to.be generated by the
Facility based on its design- features and the predicted incidence of
..Suspension of Operations. - .-
ARTICLE XI. SUSPENSION OF OPERATIONS
A. If a Suspension of Operations occurs, the COMPANY shall
Promptly advise the MUNICIPALITY- of such occurrence, its effect on the
ability of the COMPANY to accept Acceptable Waste from the
MUNICIPALITY at the Facility, and its probable duration. During .a
Suspension of Operations the COMPANY shall, in consideration of the
Tipping Fee, provide for and pay for the disposal of the MUNICIPALITY's.
Acceptable Waste up to its Guaranteed Plant Capacity Share. The
COMPANY shall use its best efforts to resume normal "'operations at the
Facility at the earliest practicable time. So long as COMPANY meets its
obligations hereunder it shall not be deemed in default of this Agreement.
B. During a—Suspension of Operations, the 'COMPANY may require
xhe MUNICIPALITY to deliver its Acceptable Waste to an .alternative waste
disposal facility. The COMPANY shall use its best efforts to arrange for
-24-
said
alternative waste facility in close proximity to the Facility with due
regard for costs of each of the parties. The COMPANY shall pay any
incremental transportationcosts incurred by the MUNICIPALITY or its
embers as a result of delivering Bypass Waste to such alternative waste
disposal facility, but only if such alternative waste disposal facility i
located, a distance greater than 10 miles radius from the intersection of
Union and Main Streets in Bangor. The MUNICIPALITY's incremental
_ transportation Posts shall... include a -reasonable mileage- allowance for
vehicular use, -added labor costs, and, if applicable, any additional
storage capacity required . by the MUNICIPALITY as the result of a
decrease in the number of waste deliveries that can be made in a given
day due to, an increase in distance. -
- C. The COMPANY may periodically suspend operations for 2in<e-
mace and repair purposes and shall us its best efforts to schedule such
intenance and repairs- at periods when delivery of a low quantity of
Acceptable Waste is anticipated and at periods of any energy purchaser's
off-peak demand. The COMPANY shall use its best efforts to give 30 -day
Prior written notice to the MUNICIPALITY of a scheduled Suspension of
�l Operations, indicating the 'expected time, duration and nature of such
Suspension of Operations.
ARTICLE XII. DAMAGE OR DESTRUCTION
... ..
If the Facility or any substantial portion thereof iso -damaged or
destroyed by fire, the elements or other casualty that it is cot feasible to
restore, repair or reconstruct the Facility, a Termination of .Operations
._ shall be deemed to have occurred and this Agreement shall be automatics]-
iy terminated as of the date of such occurrence without any further
-25 -
liability on the part of any party, except for the obligations of the COM-
PANY to provide Back -Up Capacity. -
ARTICLE %III. TERM OF AGREEMENT- ADDITIONAL DEDICATED
CAPACITY
A., This Agreement shall commence on the date hereof and continue
in effect until the thirtieth anniversary of the Commencement Date of
Operations, unless earlier terminated as herein Provided or modified in
-' ..... writing.. by mutual consent of the parties and the trustee for the holders
of the bands issued to finance portion of the Facility.
-. .B. If the COMPANY intends -to continue to operate the Facility
beyond the term hereof, the COMPANY shall so advise the MUNICIPALITY
and grantto the MUNICIPALITY theopportunityto renew this Agreement
for an additional term upon mutually acceptable terms. -
C. Additional Plant Capacity- Priority Status
Subject to the limitation hereafter stated, the MUNICIPALITY shall
have the rightto increase its Guaranteed Annual Tonnage (and by
operation of this Agreement its Guaranteed Plant Capacity Share) at any
time during the term of this Agreement (or any extension thereof). Such
right shall be exercisable at any time upon the giving of written notice
by the MUNICIPALITY to the COMPANY five (5) years in advance of such
increase, except that within the first five (5) -years from the
Commencement -Date of Operations, as defined in a certain Agreement
dated June 4, 19M between the COMPANY and Bangor Hydro -Electric
Company, such written notice need only be .given three (3) years in
-advance of such increase. - -
Notwithstanding the foregoing,it is understood and agreed by the
parties that the MUNICIPALITY shall not be entitled to increase its
-26 -
Guaranteed Annual Tonnage in excess of 20% of the Guaranteed Annual
Tonnage _ of the .MUNICIPALITY as of the Commencement Date of
., Operations without the consent of the COMPANY.
The nature and extent of this provision shall be described in all
. waste and -other -. fuer procurement contracts entered into by the COMPA-
NY, including contracts with SERF, which contracts shall remain available
for review, by the MUNICIPALITY during usual business hours.
ARTICLE XIV. DEFAULT. -
A. Each .a the following events shall constitute an "Event of
Default" hereunder.
1. A failure to pay when due and payable any amountsowed
e party to.the other and the continuance of such failure for. sixty (g0)
days after receipt of written notice of nonpayment; or
2: Failure of either party to observe and perform any cove-
nant, condition or agreement on its part required to be observed or
performed by this Agreement for a continuous period of one hundred
twenty (120) days after receipt of written notice from the non -defaulting
party, specifying such failure and demanding such failure be corrected;
Provided, however,if the failure stated in the notice cannot be corrected
within such period, the non -defaulting party will not unreasonably with-
hold its consent to an extension of such period if corrective action iz
instituted within such 'period and diligently pursued until the default is
corrected. This subparagraph (2)shallbe in addition to any Event of
Default described under subparagraph (1) above and shall not apply to
any, default described in Article 'III, which default shall" be governed -
exclusively by the provisions of Paragraph C thereof.
_27-
B. Whenever any Event of Default shall have -occurred and be
continuing, which Event of Default is substantial and concerns a material
_. provision of this Agreement, the non -defaulting party may terminate this
Agreement upon giving thirty (30) days' written notice to the defaulting
party. This provision; however, is subject to the condition that if, after
._ sending a notice of- termination, the defaulting party pays in full- any
amount s _owing under this Agreement, the notice of termination shall be
cancelled and the Parties shall be restored to their 'prior position under
this Agreement, but no such cancellation shall affect any subsequent
default or impair or exhaust any rights or powers arising therefrom.
_. C. Whenever an Event of Default shall have occurred and be
continuing, the npn-defaulting party may take whatever action may be
,necessary or desirable to collect the payments and other amounts then
due and thereafter to became due as provided in this Agreement, or to
enforce performance .and observance of any obligation, agreement or
covenant under this Agreement.
D. If at any time subsequent to Commencement Date of Operations,
a Termination of Operations occurs which is not caused by a Force
Majeure Event, the COMPANY shall pay - to the MUNICIPALITY, as
liquidated damages in lieu of all other damages, including special,
consequential, or indirect damages, two hundred and fifty percent (2504)
of (I) the total Tipping Fees paid by the MUNICIPALITY forAcceptable
Waste delivered to the Facility by it during the Operating Year
mediately preceding the date on which the Termination of Operations
occurred, or (2) if at least one full Operating Year -has not elasped from
the Commencement Date of Operations to the date on which the
Termination of Operations occurs, the total Tipping Fees that would have
R
been paid by the MUNICIPALITY to the COMPANY had it delivered to the
Facility an amount of Acceptable,. Waste equal to its Guaranteed Annual
Tonnage. If requested by ,the MUNICIPALITY, a bondor other form of
security acceptable to the MUNICIPALITY shall be posted. -
E. If at any time subsequent to the Commencement Date of op-
erations and prior to Termination of Operations, the COMPANY fails to
accept and/or Provide for the disposal, of Acceptable Waste delivered to it
by the. MUNICIPALITY up to. -its Guaranteed Plant Capacity -Share and
such failure is not caused by Force Majeure Event, the COMPANY shall
Pay to the MUNICIPALITY all reasonable costs -incurred by the
MUNICIPALITY in disposing of such Acceptable Waste, .provided that
nothing herein contained- shall _be construed to bar the MUNICIPALITY
.. from obtaining specific Performanceofany obligation of the COMPANY if -
such remedy is otherwise available. The COMPANY shall not be liable for
its refusal or failure to process any amounts annually in excess of the
MUNICIPALITY'S Guaranteed Plant Capacity Share. The COMPANY shall
pay such costs within 45 days of .receipt of an itemized bill from the
MUNICIPALITY.
F. The COMPANY shall endeavor to include as part of any' contract
which it negotiates with landfill operators for the acceptance of Bypass
Waste a provision to the -effect that such contract shall not be terminated
in the event of a Termination ofOperationsunless the MUNICIPALITY or
an organization which includes the MUNICIPALITY is first granted the
right to assume the obligations of the -COMPANY. under such. contract.
G. In the event any. agreement or covenant contained in this
Agreement should be breached by one party and thereafter waived by the
-29 -
other party, such waiver shall be limited to the particular .breach so
waived and shall not be deemed to waiveany other breach hereunder.
ARTICLE W. CHANGE IN LAW
A. If, after the signing of ,this Agreement, as direct result of -
-
any Change in -law (as defined below), the COMPANY shall incur, any
Increase in Cost (as defined below), the COMPANY shall be:entftled to
_recover from the MUNICIPALITY.a proportionate share of such Increase in
Cost equal to the amount ofsuch increase in. Cost multiplied by a fraction - I
.. the numerator of which Is the MUNICIPALITY's Guaranteed Annual 1
Tonnage and the denominator of which is 230,000.- Such recovery shall {
be effected by increasing the Tipping Fees to be thereafterpaidby the
MUNICIPALITY, up to a maximum. cumulative increase of 2506overwhat -'
the Tipping Fees, would be but for such adjustment, until such -recovery
is effected in full.
B. "Change in Law' includes the following: The promulgation, -
adoption, enactment or change in any law, code; ordinance or regulation -'
and/or rendering of any judgment, order, decree or other governmental
action of any Federal, State or local court, administrative agency, gov-
ernment office, body or branch, occurring subsequent toJuly 1, 1988;
affecting the construction, operation or maintenance of the Facility or the
disposal of Residue, including by way of example but not by way of
._ limitation a refusal by such a governmental bodytogrant, issue or renew
any required permit orlicense or approval for the operation of the Facili-
ty.unless changes in the Facility are made. Changes in Federal and State
- - -
income tax laws shall not be considered a Change in Law.
C. "Increase in Cost" means any, increase in the cost of financing,
construction, modifying, operating or maintaining the Facility or the Site,
-30 -
or the disposal of Residue, or Bypass Waste related solely to .a -Change in
.Law, which on a cumulative basis_ exceeds $100,001); provided that -if any
such increase in cost results solely from a change in. the design, fuel
mix, o. operating criteria of the Facility which is not mandated by law
and which -is initiated by the COMPANY subsequent to the execution of
this, Agreement, such increase in cost shall be disregarded for purposes
of this Article.
D. The following procedures shall govern this -Article: - - -
- 1. COMPANY shall notify the MUNICIPALITY and the 1
MUNICIPALITY shall notify the COMPANY inwriting, as soon as either
party has knowledge, of any administrative, court or other governmental
action or,the enactmentof any law orregulation which could lead to a
claim -of the occurrence of a Change -in Law, and each party shall keep
the other informed of the Progress of such actions.
2. Upon determining the impactof any Change in Law and
determining any Increase - in- Cost, COMPANY shall- - give the
MUNICIPALITY a detailed explanation thereof, including, appropriate
designs or plans for new construction or modifying items, bid cost and
construction schedule, and information regarding - operations and
maintenance costs. COMPANY shall not expend any monies in response to
a Change in Law until the MUNICIPALITY has had 45 days to review such
data. The MUNICIPALITY must authorize or disapprove expenditure of
any Increase in Cost proposed by the COMPANY within 45 days, or
propose an alternative reasonably satisfactory to the COMPANY, or said
-expenditure shall be conclusively deemed to be -authorized by the
MUNICIPALITY. During any ,Suspension of Operations because of any
Change in Law ,pending the MUNICIPALITY'S review under this
-31 -
paragraph,. the COMPANY shall be relieved of any penalties and shall not
be deemed to be in Default.
E. Nothing in.this Article shall relieve the COMPANY from compli-
ance with any law or. regulation or other lawful order.
ARTICLE XVI. FORCE MAJEURE
A. Except as herein provided, if any party is rendered unable,
wholly or in part, by a_ Force Majeure, Event to carry out its obligations-
other .than any- payment obligation under the Agreement, that party shall -
give to the other .party. prompt written notice of the 'Force Majeure Event
with reasonably full particulars concerning it. Thereupon the obligations
of the party giving the notice,, so far as, they are affected by the Force
Majeure Event, shall be suspended during, but no longer than the Contin-
uance of the Force Majeure, Event, and for a reasonable time thereafter if '-
required to remedy the physical damages, and/or place the Facility back in
operation. In the event that the Facility is subjected to a Force Majeure
- - Event, all Acceptable Waste shall constitute Bypass Waste unless there is
a Termination of Operations. -
C. The party whose performance is excused due to the occurrence
of a Force Majeure Event shall, during such period; keep the other party
duly notified of all such actions required in order for it to be at fo
commence or resume performance of its obligations under this Agreement.
D. Financial inability of either Party hereto or the technological
inability of the Facility to accomplish the purposes contemplated by this
Agreement shall not be deemed to be a Force Majeure Event.
E. Notwithstanding anything in this Article XVI to the contrary the
'COMPANY shall not be excused from its obligation to provide Back-Up
CapacityCapacity to the MUNICIPALITY by a Force Majeure Event.
_y2_
ARTICLE.XVII. ASSIGNMENT -DELEGATION
A. This Agreement shall not be assigned or delegated by any party
without the prior writtenconsent of the other party exceptes follows:
(i) On or after the Initial Date of Delivery as the term is defined in
a certain agreement between the COMPANY and the Bangor Hydro -Electric
Company dated June 21, 1984, the COMPANYmay transfer its interest in
this Agreement to a party which acquires. all or substantially all of the
assets of the COMPANY, whether by merger, consolidation, asset-
8qr �
chase, or other means (an "Acquiring Party') provided the COMPANY '..
guarantees the performance of theAcquiringParty under this Agreement;'
(ii). On. or before said Initial ,Date of Delivery, the COMPANY may -
transfer its interest in this Agreement to an Acquiring Party provided (a) -
the Acquiring Party is no less financially responsible than the COMPANY,
(b) the Principals of the COMPANY remain actively involved in the devel-
opment and operation of the Facility until said Initial Date of Delivery,
(c) such transfer will not delay or otherwise adversely affect the devel-
opment of the Facility, and (d) the COMPANY guarantees She performance
of the Acquiring Party under this Agreement.
(iii) At any time _ subsequent to the data of this Agreement
MUNICIPALITY may assign its interest in this Agreement to a district
which may be formed by the members of the. Penobscot Valley solid Waste
Project, provided such district includes the MUNICIPALITY.
B.. Anything to the contrary notwithstanding, the MUNICIPALITY
I
consents to the COMPANY granting mortgages upon the Facility and
conditionally assigning its rights and benefits under this Agreement for
the purposes of obtaining financing for the Facility. -
ARTICLE XVIII. APPLICABLE LAW
The law of the State of Maine shall govern the validity, interprets -
tion, construction and performance hereof.
ARTICLE XIX. AMENDMENT OF AGREEMENT - -
No amendments to this Agreement may be made a cept in writing ..
signed by both parties. Should this Agreement be assigned to a trustee
under bond financing arrangements, the written consent of such assignee
shall also be required before any amendment become effective.
ARTICLE XX. SEVERABILITY
In the event any covenant, condition or provision of this Agreement
is held to be. invalid or unenforceably by a final judgment of a court of
I
-- competent, jurisdiction, the invalidityor unenforceability thereof. shall i
.. ,way _affect any of the.other covenants, conditions or provisions here -
Of,. provided that such remaining covenants, conditions or provisions can
thereafter be applicable andeffective without materially changing the
obligations of either party.
ARTICLE XXI. RELATIONSHIP OF THE PARTIES
Nothing herein shall be deemed to constitute either party a partner,
agent, or local representative of the other party or to create any fidu-
ciary relationship between the parties.
ARTICLE XXII. REPRESENTATIVES
The authorized representative of each of the parties for the pur-
poses hereof shall be such persons as the parties may from time to time
designate in writing.
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ARTICLE XXIII. NOTICES - All notices .herein required or permitted to be given or furnished
under this Agreement by. either party to the other shall be in writing,
and shall be deemed sufficiently given and served upon the other as if
sent by certified or registered mail, return receipt requested, postage
._ prepaid, addressed as follows: -
i
If to COMPANY: Penobscot Energy Recovery Comp any
do Bernstein, Shur. Sawyer and Nelson
_. One Monument Square
Portland, Maine 04101
If to MUNICIPALITY:
Maine
Each party shall have the right, from time to time to designate a different
Person and or address by. notice given in conformity with this section.
ARTICLE XXIV.. BINDING EFFECT -
The Agreement shall bind upon and inure to the benefit of the
parties hereto and their respective successors or assignees.
ARTICLE XXV. OTHER DOCUMENTS
Each party promises and agrees to execute and deliver any instru-
ments and to perform any acts which may be necessary or reasonably
required in order to give full effect hereto.
ARTICLE XXVI. HEADINGS
Captions and headings ,herein are for ease of reference and do not
constitute a part of this Agreement.
ARTICLE XXVII. COUNTERPARTS
This Agreement may be executed in more than one counterpart, each
of which shall be doemed an original and all of which together shall
constitute the same agreement.
-35 -
ARTICLE XXVI It. INTEGRATIONS
This instrument (including all .appendices and attachments hereto)
and a certain side letter of even,date embodies the whole Agreement of
the parties. There are no promises, terms, conditions, or obligations
other than those contained herein and in such side letter. This
_'.Agreement shall supersede all previous communications, representations,
or agreements, either oral or written, between the parties hereto. In the
event that the requirementsof any Article of this Agreement shall be
found to be inconsistent with those of any Appendix, the Article shall
control.
ARTICLE XXIX. CONSENTS
.. To the extent that the consent of either, party to this Agreement i
., required to any action of the other party pursuant to any provision of
this Agreement, such consent will not be unreasonably withheld'.
ARTICLE XXX. MEDIATION
A. The MUNICIPALITY and the COMPANY shall confer from time to
time to review operations and the relationship in general.
B. If a dispute should arise between the parties under this Agree-
--- ment, the parties shall submit such dispute to a mediator in an effort to
obtain a nonjudicial resolution thereof. The mediator shall be a person
mutually agreed upon by the parties or, if the parties are unable to
reach such agreement, the highest- ranking officer of the Maine Bar
Association Who is both disinterested and willing to so serve in such
capacity. The costs of such mediation shall be shared equally by the
parties. The parties shall make a good faith effort to resolve their dis-
putes by mediation for a period of ten (10) business days. If upon the
36-
expiration of such ten (10) days, theparties have not been able to
resolve their dispute, the mediation processshallbe terminated.
C. The parties covenant with one another not to commence legal
Proceedings concerning the subject matter of their dispute until the
mediation Process has been terminated- unsuccessfully as provided in
subparagraph A above, unless such legal proceedings are deemed -notes
ary in order to preserve the rights of the parties or to obtain relief to
Prevent irreparable harm.
IN WITNESS WHEREOF, tAe parties hereto have executed this con-
tract on this _ day. of , 1985
WITNESS:
PENOBSCOT ENERGY RECOVERY
COMPANY
By: PERC Management Company,
Its General Partner
By: PERC, INC., Its General
Partner
By:
Its President
GUARANTEE
Kuhr Technologies, Inc., a New Jersey .corporation, hereby
unconditionally guaranteesto the. MUNICIPALITY the due and punctual
performance of any and all obligations of the COMPANY under this
Agreement
KUHR TECHNOLOGIES, INC.
By:
Its President
1]019:019