Memorandum of Agreement free essay sample

WITNESSETH THAT: WHEREAS, that the Republic Act 9003 of 2000 mandates the City to promote, preserve and protect the health of its constituency by way of determining the manner of disposal and recycling of solid waste generated by the CITY residents; WHEREAS, that the CITY OF SAN PABLO, has the desire to Purchase a MATERIAL RECOVERY FACILITY (â€Å"MRF†), ELECTRICAL LINE WIRINGS, WATER SYSTEM, ROOFED BUILDING and AUTO-SORTING MACHINERY with the contractor. WHEREAS, that the GREEN HARVEST TECHNOLOGIES INTERNATION INC. for valuable consideration hereinafter specified, shall SUPPLY, FABRICATE, INSTALL AND OPERATE THE MATERIAL RECOVERY FACILITY (â€Å"MRF†) and perform solid waste recycling and disposal services as contemplated herein; NOW, THEREFORE, the Parties have mutually agreed to be bound by the following terms and conditions, A. NATURE OF THE PROJECT: The primordial goal of the project is to promote, preserve and protect the health of the City’s constituents a nd its environment through an efficient way of waste disposal as mandated by Republic Act 9003 of 2000. The project will be undertaken through the Purchase of the CITY of the MATERIAL RECOVERY FACILITIES (â€Å"MRF†), ELECTRICAL LINE WIRINGS, WATER SYSTEM, ROOFED BUILDING and AUTO-SORTING MACHINERY to be Supplied, Install, and Operate scheme of the contractor, wherein the Contractor will provide a highly innovative approach in solving the City’s predicament in waste management and disposal through the introduction of a modern Material Recovery Facility (MRF) and other allied services. B. LOCATION OF THE MATERIAL RECOVERY FACILITIES (MRF) It is strategically located at Barangay San Ignacio, San Pablo City, with a approximate area of five hectares. C. DUTIES AND OBLIGATIONS OF THE CONTRACTOR: B. 1. PROVISION OF MRF AND RELATED SERVICES: a. To supply one (1) lot of a Material Recovery Facility (MRF) that will be installed at the designated Service Area. The duly approved mechanical and technical specification of the MRF is hereto attached and marked as Annex â€Å"A†; b. To operate the MRF and provide Waste Recycling Services. These specific recycling services is detailed in Annex â€Å"B† hereof; c. To provide Operational and Safety Training for all parties involved, both for the City and the Contractor; d. To rehabilitate the City’s existing old MRF. Rehabilitation cost will be paid by the CITY, and it will be considered operating cost deducted against the city. e. To provide qualified personnel such as drivers, mechanical, supervisory, clerical and other personnel that may be necessary to provide the Recycling Services in a safe, economical and efficient manner. The names, qualifications and other personal data of these personnel is detailed in Annex â€Å"C†, hereof. The Contractor may, from time to time, change the list of personnel depending on the requirement of the MRF operations after considering the varying gravity of daily waste disposal f. To supply and install Electrical Line Wirings (from the MERALCO MAINLINE to the MRF Machineries), SUFFICIENT Water System, Roofed Building and Auto Sorting Machine. The mechanics and installation cost, will be paid by the CITY as agreed upon by both parties is detailed in Annex â€Å"D† hereof; g. To provide additional facilities, equipments and other machine to meet the increasing demand of the disposal of waste on the facility. B. 2. MRF’S TECHNICAL OPERATIONS: a. To provide a five (5) days operation per week with a working hour of 8:00 am to 12:00 noon and 1:00 pm to 5:00 pm. An overtime work rate will be charged. b. To prepare and submit a monthly report of the production and sales of the MRF to the CITY. c. To issue a TICKET with a corresponding amount of every truck load. The ticket will be purchase from the contractor. NO TICKET NO ENTRY will be strictly imposed. see ANNEX E; d. To implement the complete working outfit, uniforms, identification card, safety shoes, safety helmet during the working hours inside the MRF. e. To issue company rules and regulation and company guidelines. B. 3. MRF’S OPERATIONS’ COSTS AND EXPENSES: a. The Contractor SHALL deduct the Operating Cost or all Expenses incurred during the operation of the MRF from the Gross Income on a monthly basis; b. The â€Å"CITY† shall reimburse â€Å"The CONTRACTOR† for all the costs and expenses incurred during the construction and installation of the Electrical line wirings, Water System facilities, Roofed Building and Auto Sorting Machine being constructed. Payment for this purpose shall be made within a period of one (1) year on a prorated monthly deduction on the monthly Gross Income. Delivery by the Contractor of Electrical line wirings, Water System, Roofed Building and auto Sorting Machine shall be permitted to charge additional Service Fee. The Electrical Line Wirings, Water System, Roofed Building and Auto Sorting Machine, will remain the property of the Contractor, until the time â€Å"The City† is fully paid. B. 4. CONTRACTOR’S CONSULTANCY AND PERSONNEL: The Contractor, shall: a. That the contractor shall Assign Consultants and Qualified Personnel before and during the Operations. See detailed descriptions listed in ANNEX C; . That the contractor shall Process, dispose the Household Solid Waste material into Pellets, Fertilizer, and Hollow-Blocks using the supplied â€Å"Equipment†; c. Not later than the tenth (10th) day of each calendar month, the CITY will pay the Contractor’s Consultant, the list of which is hereto attached as Annex â€Å"C†. Provided, however, that the Contractor retains the right to change the name of designated Consultants from time to time, in order to accomplish its duties and responsibilities to the City. Within thirty (30) days of receipt of the Statement of Account issued by the Contractor, the City shall notify the Contractor of any dispute it may arise with respect to the Contractor’s Statement of Service Fees; D. DUTIES AND OBLIGATIONS OF THE CITY: C. 1. PAYMENT OF MRF AND OTHER RELATED SERVICES: a. Upon the execution of this Agreement, the City shall pay the Contractor the amount of ____________________ (P___________) representing down payment of 50% from the total amount of the equipment (MRF) and a prorated monthly billing up till one(1) week before it’s delivery for the Contractors Fabrication, Delivery and Installation Cost; . Subsequent of the City payments will be based on the Contractor’s Prorated Billing of _____________________ (P___________) during the MRF’s construction and installation. c. The CITY must be able PAY IN FULL the total Cost of the MRF and settle all billings one (1) week before its delivery; d. Within thirty (30) days of rece ipt of the Statement of Account issued by the Contractor, the CITY will pay the Contractor all payables due with respect to the Contractor’s Statement of Account. e. The City will issue a PURCHASE ORDER after the signing of the Contract. f. The City will pay on a prorated billing for the installation of: 1. Electrical Line Wirings (Meralco line connection from the main to the MRF), 2. Water System (water line from main to MRF) 3. Roofed Building (housing infrastructure) 4. Auto Sorting Machine Refer to Annex D g. The City shall purchase the vouchers or tickets from the Contractors assigned personnel for every entry of each truck load. See Annex E for the Cost of Tipping Fees and per Truck Capacity. h. Fabrication, construction Delivery and Installation shall be done by the Contractor. See details on ANNEX A. C. 2 ON MRF OPERATIONS: a. The City shall deliver 50 trucks of solid waste per day which will start on the dry run in order to calculate the recycled output and projected income; b. Dry run shall start in three (3) months, couponing and ticket collection shall be imposed so that the contractor will be able to prepare the estimated projected income. c. The City under the engineering department shall provide sufficient payloader and trucks during the operation; d. The City shall assist additional manpower under the solid waste management of the City of San Pablo, Laguna. re-employment of old or previous employee which is subject for evaluation of the contractor); e. During the time that the Contractor is on the early stages the City will help the contractor in promoting and marketing the finish products through provision on mutual cooperation and bidding process; f. The City will provide perimeter fence around the assigned area of the MRF. g. The City is responsible for the expenses in curred during the training of personnel before the operation of the MRF. h. The City will assign only a certified â€Å"BUY-BACK CENTER† a private entity or a non-government organization that will purchase or buy the â€Å"processed materials† or â€Å"finished product† like Firewood Pellets, Fertilizer, Hollow-Blocks, and Bricks. h. 1 In the event that there is no buyer for the finished products , the CITY will provide sufficient storage area. The Finished products will be considered SOLD and it will be reported as SALE of the â€Å"Contractor† which will be audited by the â€Å"Contractor† and â€Å"The City† in a monthly basis. C. 3 HAULING a. The City shall be responsible for all the Hauling operations by providing equipment, vehicle, transportation, expenses and salaries and wages of the personnel. The Hauling personnel will be under the supervision of the CITY during the operation; b. The City will provide adequate security personnel on the area to secure the entry and the outgoing trucks. C. 4 PERMITS AND LICENSES a. The City shall help and provide all required government permits such as DENR permits, ECC, ETV, local permits and any permit and licenses required by other government agencies. The City shall provide the Contractor all permits and licenses required by law or ordinance and maintain the same in full force and effect. The CITY shall likewise exempt the CONTRACTOR from payment of local taxes imposed by the City and other fees for regulatory purposes; C. 5 SECURITY a. The City shall provide adequate security personnel with a round the clock or twenty four hours operations within the perimeter area of the MRF. C. 6 ENDORSEMENT TO COOPERATIVES AND DIFFERENT MUNICIPALITIES a. PROVISION ON MUTUAL COOPERATION: The City shall provide this provision to the Contractor, because the CITY has all the potential buyers. The City shall invite bidders for the sale of the FINISHED PRODUCTS, like cooperatives and other entity of the same industry. b. The City shall encourage other municipalities and cities to dispose their soild waste on our MRF, or make an endorsement. A proper Endorsement of Sanggunian Resolution may be made in order to increase sales and revenues of the CITY. D. FINISHED PRODUCTS D. 1 The main product of the Facility will be FIRE WOOD PELLETS. The â€Å"MRF† will also produce Organic Fertilizer, Hollow-Blocks and bricks. The Contractor has all the prerogative on how the MRF will operate; D. 2 The City will provide and assign one â€Å"BUY-BACK-CENTER† through bidding process. However, a Provision on Mutual Cooperation shall be provided by the City. In the event that there is no assigned â€Å"BUY-BACK-CENTER†, The CITY will provide a sufficient storage area to all Finished Products, Recycled wastes, which they are considered sold; D. 3 The Contractor will be responsible for all the maintenance and repair of the MRF during the contract period. The City has the option to pay the extended warranty fees after the termination of the contract; D. The Contractor will provide a quarterly STATUS REPOR of operation to The City. The City and the Contractor is responsible of providing status reports to any Government Agencies; E. INCOME SHARING E. 1 The sharing is 50% to the Contractor and 50% to the City on the income derived from all revenues of the MRF. However, overhead expenses, administrative expenses and ongoing construction costs incurred by the Contractor such as the following: MERALCO electrical wirings with transformer of 450KVA ( from Main Line to â€Å"MRF Facility†), Roofed housing for the MRF, (estimated 1,540 sq. eters) Auto Sorting Machine and interest, Consultation fees, Inoculants, Transportation allowances, Office Supplies, Maintenance Cost and Consumables of the Equipment, Water and Electrical Billing, Salaries and Wages and Benefits will be deducted from the proceeds. E. 2 Estimated projected Income will be submitted after the three months dry run operations; E. 3 Contact Person All business dealings, contacts, notices, and payments between the Contractor and the City shall be identified and designated by both parties. The financial Statement herein mentioned shall be reported annually by the Contractor and submitted to the City on or before May 1, 2012 of each Contract Year commencing May of 2013. F. EXCLUSIVITY: F. 1 It is hereby expressly agreed, accepted and understood by the City that the Contractor shall provide exclusive solid waste Material Recovery Facility and disposal services within the area of San Pablo City, Laguna for the contract period of the project, specifically from April 1, 2012 until March 31, 2013 herein specified as the â€Å"Initial Term†. Upon the expiration of the Initial Term, this Contract shall be automatically renewed for an additional two (2) years term specified as the â€Å"Renewal Term†. Both parties shall provide at least ninety (90) days period, a written notice to both parties of its intent to renew or not to renew the Contract before the expiration of the renewal Term. The City shall not enter into agreement with any other entity for Waste Recycling Services specified in this contract. F. 2 The Contractor shall have all the exclusive rights in receiving and operating the Solid Waste within the City of San Pablo. G. SERVICE FEE AND OPERATIONAL EXPENSES ADJUSTMENTS G. 1 That the city willfully agrees, the contractor will increase tipping fee to augment in the increase in operational costs and expenses incurred by the Contractor as a result of a â€Å"Change In Law,† and Stipulation beyond the City’s Administrative and Electoral Term whether imposed retroactively or prospectively, that changes, modifies, and alters requirements upon: (i) performing the Recycling Services; or (ii) the operation of the applicable Facility, (iii) Processing Facility. H. UNDUE HARDSHIPS AND LOSSES Contractor may provide a notice to the City that the expenses and other expenses beyond uncontrollable circumstances on the operation of the MRF are overly burdensome. Upon such notice, the CITY and the CONTRACTOR will negotiate in good faith to amend in a commercially reasonable manner how both parties will get a profit from the operations. Furthermore, if at any time after the first Contract Year the MRF is modified, The City and Contractor will agree to negotiate in good faith to modify and determine the possibilities for the good operation of the MRF. I. NATURAL DISASTERS AND UNCONTROLLABLE CIRCUMSTANCES I. 1 NATURAL DISASTERS a. In the event of fire, hurricane, tornado, major storm, high winds or any ACTS OF GOD, the Contractor has no responsibility for any damages. The CITY will negotiate with the CONTRACTOR to assess the damages and submit to the city the report how much the total amount of the repair. The contractor will submit a quotation to the city. I. 2 UNCONTROLLABLE CIRCUMSTANCES a. The City or Contractor shall be considered to be not in Default of this Contract if delays or failure of performance, was due to Uncontrollable Circumstances. The non- performing party shall give a written notice to other party describing the circumstances and the uncontrollable forces preventing continued performances of the obligations of this contract. J. TERMINATION OF SERVICE J. 1 The contractor have the right to suspend the operation of the MRF immediately, due to the non-compliance of the Duties and Responsibilities of the City and Exclusivity, the Contractor shall have the right to pursue all other rights and remedies available to the Contractor pursuant to this Contract. K. DEFAULT OF CONTRACT K. 1 RIGHTS AND REMEDIES UPON DEFAULT If a party is in Default, at the option of the non-Defaulting party, this Contract may be immediately terminated or suspended upon written notice to the Defaulting party. The defaulting party has no any obligations caused by the default. This Contract may be continued in force and the non-Defaulting party shall have the right to negotiate again with the defaulting party and apply the rights and remedies for the benefit of both parties. K. EVENTS OF DEFAULT BY CONTRACTOR – The contractor is in default if there is a failure to comply with any material provision of this Contract. After a written notice from the City setting forth the specific provision and noncompliance, the notice shall be mailed to Contractor to its principal address of business by certified mail courier and return receipt requested. The City, upon notice to the Contractor and negotiation was held, for good cause, may declare this Contract forfeited a nd exclude the Contractor from further operation and shall thereupon surrender all rights in and under this Contract. K. 3 EVENTS OF DEFAULT BY THE CITY The CITY is in default if a failure to perform obligations under the terms of this Contract or the Ordinance for the execution of this Contract, and the continuance of such failure after (i) written notice thereof has been provided by the Contractor, specifying such failure and requesting that such condition be remedied, and (ii) City’s failure to cure the Default. L. INDEPENDENCE OF PARTIES TO AGREEMENT It is understood and agreed that nothing herein contained is intended or should be construed as in any way establishing a partnership relationship between the parties hereto, or as constituting the Contractor as the agent, representative or employee of the City for any purpose whatsoever. The Contractor is to be and shall remain an independent contractor with respect to all services performed under this Contract. M. CONSTRUCTION AND MODIFICATION This Contract is to be construed consistent with the Ordinance duly executed and approved by the â€Å"Sangguniang Panlungsod†.