Delegation Agreement.pdf
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DELEGATION AGREEMENT
For the Operation and Maintenance of a
Water Reclamation Facility
Floreo at Teravalis
City of Buckeye, Arizona
THIS DELEGATION AGREEMENT (“Delegation Agreement”) isenteredintoasof__,
2026 (“Effective Date”), by and between CITY OF BUCKEYE, an Arizona municipal corporation
(“City”), and TRILLIUM LAND COMPANY, LLC, a Delaware limited liability company
(“Master Developer”). TRILLIUM MANAGEMENT DEVELOPMENT COMPANY LLC, a
Delaware limited liability company (“Development Manager”), may execute this Delegation
Agreement on behalf of Master Developer to the extent authorized under the Development
Agreement (defined below). Master Developer (and, if applicable, Development Manager acting
on its behalf) is sometimes referred to herein as “Developer.”
RECITALS
A. The City and Trillium Land Company, LLC, a Delaware limited liability company (“Master
Developer”) have entered into that certain Development Agreement dated April 1, 2025
(the “Development Agreement”), recorded in the Official Records of the Maricopa County
Recorder’s Office as Document Number 20250197318, pursuant to which Master
Developer has agreed to design, engineer, permit, construct, and install certain water and
wastewater facilities necessary to serve the property, known as “Floreo at Teravalis” (the
“Property”), as more particularly described in the Floreo Master Water Report, the Master
Wastewater Report for Floreo at Teravalis, and the Master Reclaimed Water Report for
Floreo at Teravalis (collectively, the “Master Reports”).
B. Pursuant to the Development Agreement, Master Developer is responsible for the design,
permitting, and construction of the Floreo at Teravalis Interim Water Reclamation Facility
(“Interim WRF”) to provide interim wastewater treatment capacity for the treatment of
wastewater generated by the Property until a permanent facility is commissioned.
C. The Interim WRF is located on approximately 9.82 acres of the Property (“Floreo at
Teravalis Interim WRF Site”), to serve the Floreo at Teravalis Service Area, as depicted on
Exhibit “B”, attached hereto.
D. City is the Designated Management Agency (“DMA”) for wastewater management within
the Service Area under the applicable Certified Areawide Water Quality Management Plan
(the “208 Plan’) and holds the ultimate governmental responsibility for wastewater utility
service under Arizona law.
E. City, in its capacity as the DMA and municipal utility provider, delegates to Master
Developer the authority to operate the Interim WRF on an interim basis. This delegation is
intended to satisfy the requirements of the Arizona Department of Environmental Quality
(“ADEQ”) regarding the provision of utility services by a private entity within a municipal
service area.
F. The parties acknowledge that Developer (or its affiliate) shall be the primary applicant and
permittee of record for all required ADEQ Permits (including, without limitation, the
Aquifer Protection Permit (“APP”) and any AZPDES permits). City hereby consents to
Developer’s status as the primary permittee and agrees to provide the necessary DMA
4 1 2 1 5 0 442 1043 1792 46 -1
5 1 2 1 5 1 442 1045 178 35 91.855980 Consent
or Letter
5 1 2 1 5 4 887 1044 47 36 96.726395 of
5 1 2 1 5 5 956 1045 60 35 96.912231 No
5 1 2 1 5 6 1046 1044 214 45 95.946297 Objection as required by ADEQ for the issuance and
maintenance of such Permits.
G. Developer intends to fulfill its delegated operational obligations through a qualified third-
party operator (“Operator”) under a separate Operations and Service Agreement, recorded
at Recorded Document No. Official Records of Maricopa County,
,
Arizona (“Operations Agreement”), to which the City is not a party.
H. The parties enter into this Delegation Agreement to memorialize the regulatory delegation,
establish the City’s step-in rights to ensure continuity of service, and define the financial
mechanism for the City’s collection and remittance of User Fees to the Developer as
reimbursement for the costs of providing these delegated services.
NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties agree
as follows:
DEFINITIONS
208 Plan means the applicable Certified Areawide Water Quality Management Plan
designating the City as the Designated Management Agency for wastewater services within the
service area, as may be amended from time to time.
ADEQ means the Arizona Department of Environmental Quality and any successor
agency.
ACC means the Arizona Corporation Commission and any successor agency.
Certified Operator has the meaning set forth in the Operations Agreement.
Default means the failure or unreasonable delay by any party to perform or otherwise act
in accordance with any term or provision of this Delegation Agreement for a period of thirty (30)
days after written notice thereof from the other party, provided, however, that if the failure or delay
2
is such that more than thirty (30) days would reasonably be required to perform such action or
comply with any term or provision hereof, then such party shall have such additional time as may
be necessary to perform or comply so long as such party commences performance or compliance
within said thirty (30) day period and diligently proceeds to complete such performance or fulfill
such obligation.
Delegated Services means the ownership, permitting, operation, maintenance, and
management of the Interim WRF and related wastewater facilities, as delegated by the City to
Master Developer pursuant to this Agreement.
Designated Management Agency or DMA means the entity designated under the 208
Plan with responsibility for wastewater management planning and oversight within a defined
service area, which entity is the City.
Dispute means any dispute, controversy, claim, or issue needing to be resolved, arising out
of or relating to this Delegation Agreement, including without limitation the formation or validity
of this Delegation Agreement, either party’s performance or alleged breach of this Delegation
Agreement, or a matter requiring negotiation, agreement, and resolution by the parties during the
term of this Delegation Agreement.
Dispute Resolution Process means a set of procedures established under this Delegation
Agreement for resolving Disputes through good faith negotiation or arbitration.
Effective Date means the date of this Delegation Agreement, as specified in the
introductory paragraph above.
Event of Default means one or more of those events described in Article 6 that allows a
party to obtain a remedy if not cured after notice.
Floreo at Teravalis Collection System means those facilities, pipes, connections, and
appurtenances used to collect, convey, and transport System Influent within the Floreo at Teravalis
Service Area to the Interim WRF.
Floreo at Teravalis Development means those lands within the Floreo at Teravalis
Service Area being and to be developed by Master Developer under the Development Agreement.
Floreo at Teravalis Interim WRF Site means the approximately 9.82-acre site within the
Floreo at Teravalis Development on which the Interim WRF is located, as depicted on Exhibit “B”
attached hereto.
Floreo at Teravalis Service Area means those lands described in and shown on Exhibit
“A” that receive sewer services from the Interim WRF.
Good Industry Practices means those methods, techniques, standards and practices that
at the time they are employed and in light of the circumstances known or reasonably believed to
exist at such time, are generally recognized and accepted as good and prudent practices in the
design, construction, operation or maintenance professions, as the case may be, for the municipal
and/or industrial wastewater industry, in the southwestern region of the United States and are
consistent with the same degree of skill and care ordinarily exercised by members of the respective
trade or profession.
Initial Operational Acceptance means the written authorization by the City for the
Interim WRF to begin to accept influent.
Interim WRF means the wastewater treatment plant constructed on the Floreo at Teravalis
Interim WRF Site to serve the Floreo at Teravalis Service Area.
Losses means all claims (including workers’ compensation and wage claims), demands,
suits, actions, liabilities, damages, penalties, fines, judgments, and costs and expenses, including
without limitation the costs and expenses of litigation.
Operator in Charge has the meaning set forth in the Operations Agreement.
Permits means any federal, state, or local permit, authorization, or other entitlement
necessary for the operation of the Interim WRF in a manner compliant with Applicable Law,
including but not limited to any required National Pollutant Discharge Elimination System Permit
issued by the federal Environmental Protection Agency (“EPA”), and ADEQ-issued permits.
Service Fee means the monthly, all-inclusive amount payable to Operator for routine O&M
Services at the Interim WRF. This fee covers all of Operator's costs for operating, maintaining,
supervising, and managing the Interim WRF in the ordinary course, including all labor, materials,
equipment, consumables, administrative overhead, and compliance activities necessary to perform
O&M Services in accordance with the Operations Agreement, Good Industry Practices, Applicable
Law, and the Permits. No separate management, administrative, or markup charges may be
imposed by Operator for routine O&M Services outside of the Service Fee, except as expressly
provided in the Operations Agreement.
System Influent means all municipal, commercial, and industrial wastewater flows
reaching the Interim WRF through the Floreo at Teravalis Collection System, or extension thereof,
from any and all connected sources, including residential, commercial, municipal, institutional,
and industrial sources, including infiltration and/or inflow, which do not exceed the various limits.
User means a person, firm, company, corporation, or any other entity that is connected to
the sewer system served by the Interim WRF.
User Fees means the fees collected by the City from Users for wastewater service provided
by the Interim WRF, as established by City ordinance, resolution, or rate schedule, and as may be
amended from time to time.
1. DELEGATION OF REGULATORY AUTHORITY; ADEO PERMITS
1.1 Grant of Delegated Authority. Pursuant to its authority as a municipal utility provider
and the Designated Management Agency (DMA) for the Service Area, City hereby
delegates to Developer the authority to manage and operate the Interim WRF. This
delegation includes the right to apply for, hold, and perform all obligations under any
and all ADEQ Permits (including APP and AZPDES permits) required for the Interim
WRF.
1.2 Developer as Primary Permittee. City acknowledges and consents to Developer (or
its affiliate) being the primary permittee of record for all ADEQ Permits. Developer
shall be responsible for all technical, financial, and demonstrative requirements of such
Permits.
1.3 ADEQ. To the extent ADEQ requires the City, as the DMA, to provide a Letter
5 1 5 1 1 17 2132 1108 46 36 96.771080 of
5 1 5 1 1 18 2184 1109 60 35 96.935364 No
4 1 5 1 2 0 523 1165 1722 47 -1
5 1 5 1 2 1 523 1165 224 47 87.218681 Objection,
Consent
5 1 5 1 2 3 982 1171 38 31 96.737747 to
5 1 5 1 2 4 1046 1167 187 45 94.205170 Operate, or to be named as a co-permittee or ultimate
4 1 5 1 3 0 522 1223 1722 47 -1
5 1 5 1 3 1 522 1224 225 46 96.379868 responsible
5 1 5 1 3 2 759 1225 121 45 71.754791 party”
5 1 5 1 3 3 897 1223 57 36 96.996262 for
5 1 5 1 3 4 966 1223 61 37 96.893898 the
5 1 5 1 3 5 1041 1224 145 36 96.240257 Interim
5 1 5 1 3 6 1199 1225 113 42 96.240257 WRF,
5 1 5 1 3 7 1328 1224 84 46 96.297333 City
5 1 5 1 3 8 1423 1223 136 47 96.297333 hereby
5 1 5 1 3 9 1572 1235 125 35 96.621696 agrees
5 1 5 1 3 10 1710 1228 38 31 96.862160 to
5 1 5 1 3 11 1763 1228 150 32 96.267494 execute
5 1 5 1 3 12 1927 1223 89 37 96.637886 such
5 1 5 1 3 13 2031 1223 213 37 96.026695 documents
4 1 5 1 4 0 522 1281 1723 46 -1
5 1 5 1 4 1 522 1282 38 35 96.514656 in
5 1 5 1 4 2 583 1293 22 25 95.172203 a
5 1 5 1 4 3 627 1281 93 36 95.763947 form
5 1 5 1 4 4 743 1281 217 46 96.554802 reasonably
5 1 5 1 4 5 983 1281 211 46 96.180534 acceptable
5 1 5 1 4 6 1215 1286 36 31 96.180534 to
5 1 5 1 4 7 1275 1281 60 36 96.889992 the
5 1 5 1 4 8 1358 1282 84 45 96.057396 City
5 1 5 1 4 9 1459 1282 185 45 96.455521 Attorney,
5 1 5 1 4 10 1668 1281 177 46 96.665123 provided
5 1 5 1 4 11 1867 1281 75 36 96.430809 that
5 1 5 1 4 12 1965 1281 215 46 96.694664 Developer,
5 1 5 1 4 13 2204 1292 41 24 96.996391 or
4 1 5 1 5 0 523 1339 1237 46 -1
5 1 5 1 5 1 523 1339 181 44 96.453987 affiliates,
5 1 5 1 5 2 719 1339 157 36 96.485176 remains
5 1 5 1 5 3 890 1339 187 46 96.739403 primarily
5 1 5 1 5 4 1091 1339 111 36 96.878357 liable
5 1 5 1 5 5 1215 1339 57 36 96.584595 for
5 1 5 1 5 6 1285 1339 220 46 96.440498 operational
5 1 5 1 5 7 1521 1339 239 46 96.578102 compliance.
2 1 6 0 0 0 450 1453 1800 220 -1
3 1 6 1 0 0 450 1453 1800 220 -1
4 1 6 1 1 0 450 1453 1794 47 -1
5 1 6 1 1 1 450 1455 57 35 96.227615 1.4
5 1 6 1 1 2 522 1455 168 35 96.402763 Limited
5 1 6 1 1 3 701 1456 76 34 96.611046 Use
5 1 6 1 1 4 789 1455 44 35 95.746017 of
5 1 6 1 1 5 840 1455 91 45 95.746017 City
5 1 6 1 1 6 939 1455 330 35 96.245064 Authorizations.
5 1 6 1 1 7 1283 1456 49 34 96.994675 To
5 1 6 1 1 8 1344 1454 60 36 96.119431 the
5 1 6 1 1 9 1415 1459 120 31 96.119431 extent
5 1 6 1 1 10 1547 1465 70 35 96.868820 any
5 1 6 1 1 11 1628 1454 205 46 96.750885 regulatory
5 1 6 1 1 12 1845 1454 229 46 96.408150 compliance
5 1 6 1 1 13 2084 1453 160 46 96.962280 requires
4 1 6 1 2 0 522 1510 1722 48 -1
5 1 6 1 2 1 522 1512 60 36 96.585213 the
5 1 6 1 2 2 606 1523 66 25 96.585213 use
5 1 6 1 2 3 695 1511 46 37 91.993324 of
5 1 6 1 2 4 759 1511 188 47 91.993324 City-held
5 1 6 1 2 5 972 1511 292 44 96.659721 authorizations,
5 1 6 1 2 6 1291 1512 83 46 96.862083 City
5 1 6 1 2 7 1398 1512 134 46 96.767517 hereby
5 1 6 1 2 8 1557 1516 120 42 95.996330 grants
5 1 6 1 2 9 1702 1512 207 46 96.481674 Developer
5 1 6 1 2 10 1933 1523 21 25 94.676315 a
5 1 6 1 2 11 1977 1510 153 45 93.268143 limited,
5 1 6 1 2 12 2155 1522 89 25 93.222633 non-
4 1 6 1 3 0 523 1568 1727 47 -1
5 1 6 1 3 1 523 1569 185 37 96.748787 exclusive
5 1 6 1 3 2 723 1570 137 36 96.879539 license
5 1 6 1 3 3 874 1574 38 31 97.003792 to
5 1 6 1 3 4 927 1569 186 37 96.527893 reference
5 1 6 1 3 5 1129 1569 71 37 96.547890 and
5 1 6 1 3 6 1214 1569 124 36 96.986786 utilize
5 1 6 1 3 7 1353 1569 88 37 96.872673 such
5 1 6 1 3 8 1456 1569 281 37 96.878288 authorizations
5 1 6 1 3 9 1755 1569 117 46 95.903343 solely
5 1 6 1 3 10 1887 1569 57 36 96.274261 for
5 1 6 1 3 11 1958 1569 60 37 96.755020 the
5 1 6 1 3 12 2032 1580 158 35 96.840195 purpose
5 1 6 1 3 13 2204 1568 46 36 96.867714 of
4 1 6 1 4 0 522 1627 1194 46 -1
5 1 6 1 4 1 522 1627 237 46 96.026772 maintaining
5 1 6 1 4 2 772 1627 60 36 96.274689 the
5 1 6 1 4 3 846 1627 146 36 96.723724 Interim
5 1 6 1 4 4 1005 1628 106 35 96.149269 WRF
5 1 6 1 4 5 1127 1627 37 36 96.354279 in
5 1 6 1 4 6 1179 1627 98 46 96.665428 good
5 1 6 1 4 7 1291 1627 166 46 96.599289 standing
5 1 6 1 4 8 1470 1627 89 36 93.230324 with
5 1 6 1 4 9 1569 1628 147 44 90.925446 ADEQ.
2 1 7 0 0 0 372 1743 1357 39 -1
3 1 7 1 0 0 372 1743 1357 39 -1
4 1 7 1 1 0 372 1743 1357 39 -1
5 1 7 1 1 1 372 1743 36 35 93.695587 2.
5 1 7 1 1 2 447 1743 346 39 95.506844 DELEGATION;
5 1 7 1 1 3 810 1743 124 35 96.615753 CITY
5 1 7 1 1 4 947 1743 251 39 95.063393 CONSENT;
5 1 7 1 1 5 1211 1743 105 35 95.491516 ACC
5 1 7 1 1 6 1332 1743 397 35 95.880699 COORDINATION
2 1 8 0 0 0 447 1780 1285 10 -1
3 1 8 1 0 0 447 1780 1285 10 -1
4 1 8 1 1 0 447 1780 1285 10 -1
5 1 8 1 1 1 447 1780 1285 10 95.000000
2 1 9 0 0 0 448 1856 1796 210 -1
3 1 9 1 0 0 448 1856 1796 210 -1
4 1 9 1 1 0 448 1856 1796 47 -1
5 1 9 1 1 1 448 1858 58 35 94.777161 2.1
5 1 9 1 1 2 523 1858 89 45 94.777161 City
5 1 9 1 1 3 652 1858 173 36 96.319359 Consent
5 1 9 1 1 4 864 1861 39 32 96.565849 to
5 1 9 1 1 5 944 1858 163 35 95.953972 Interim
5 1 9 1 1 6 1147 1858 226 45 95.553566 Operation.
5 1 9 1 1 7 1416 1857 82 46 96.596710 City
5 1 9 1 1 8 1539 1857 133 46 96.290840 hereby
5 1 9 1 1 9 1714 1862 170 31 94.400566 consents
5 1 9 1 1 10 1923 1862 38 31 92.915878 to
5 1 9 1 1 11 2001 1856 243 47 92.157890 Developer’s
4 1 9 1 2 0 522 1915 1722 46 -1
5 1 9 1 2 1 522 1920 253 41 95.969437 management
5 1 9 1 2 2 801 1915 69 36 96.400429 and
5 1 9 1 2 3 885 1915 189 46 95.563332 operation
5 1 9 1 2 4 1087 1915 170 46 95.563332 (through
5 1 9 1 2 5 1272 1915 189 46 96.550133 Operator)
5 1 9 1 2 6 1476 1915 46 36 96.257713 of
5 1 9 1 2 7 1530 1915 60 36 96.257713 the
5 1 9 1 2 8 1603 1915 146 36 96.184624 Interim
5 1 9 1 2 9 1761 1916 106 35 96.834602 WRF
5 1 9 1 2 10 1882 1915 128 36 95.989716 within
5 1 9 1 2 11 2022 1915 61 36 95.989716 the
5 1 9 1 2 12 2098 1915 146 35 96.432648 Service
4 1 9 1 3 0 522 1972 1722 46 -1
5 1 9 1 3 1 522 1974 96 34 96.597488 Area
5 1 9 1 3 2 631 1972 128 46 96.494209 during
5 1 9 1 3 3 772 1972 60 36 96.866783 the
5 1 9 1 3 4 846 1978 90 30 96.415642 term
5 1 9 1 3 5 951 1972 46 36 96.754250 of
5 1 9 1 3 6 1004 1972 72 36 96.760368 this
5 1 9 1 3 7 1090 1972 218 46 96.342026 Delegation
5 1 9 1 3 8 1318 1974 230 44 95.965637 Agreement,
5 1 9 1 3 9 1566 1972 139 46 96.497536 subject
5 1 9 1 3 10 1718 1978 37 30 96.844200 to
5 1 9 1 3 11 1767 1972 218 46 96.546066 Applicable
5 1 9 1 3 12 1999 1974 88 34 96.410873 Law
5 1 9 1 3 13 2102 1972 69 36 96.410873 and
5 1 9 1 3 14 2185 1972 59 36 95.558426 the
4 1 9 1 4 0 522 2030 161 36 -1
5 1 9 1 4 1 522 2030 161 36 96.556854 Permits.
2 1 10 0 0 0 447 2144 1798 335 -1
3 1 10 1 0 0 447 2144 1798 335 -1
4 1 10 1 1 0 447 2144 1798 47 -1
5 1 10 1 1 1 447 2146 60 35 96.302643 2.2
5 1 10 1 1 2 522 2146 236 45 95.263779 Regulatory
5 1 10 1 1 3 782 2146 373 35 95.873390 Communications.
5 1 10 1 1 4 1182 2145 204 46 96.476692 Developer
5 1 10 1 1 5 1409 2145 170 46 96.256935 (through
5 1 10 1 1 6 1604 2145 190 46 96.425476 Operator)
5 1 10 1 1 7 1820 2145 90 36 95.911201 shall
5 1 10 1 1 8 1934 2145 47 36 96.748306 be
5 1 10 1 1 9 2004 2145 60 36 96.767975 the
5 1 10 1 1 10 2087 2144 158 46 96.599159 primary
4 1 10 1 2 0 522 2202 1722 46 -1
5 1 10 1 2 1 522 2203 102 45 96.316994 point
5 1 10 1 2 2 648 2203 45 36 96.639603 of
5 1 10 1 2 3 712 2207 143 32 95.983559 contact
5 1 10 1 2 4 879 2202 58 37 96.304741 for
5 1 10 1 2 5 960 2203 218 45 96.376343 day-to-day
5 1 10 1 2 6 1203 2203 325 36 96.321381 communications
5 1 10 1 2 7 1553 2203 88 35 93.035355 with
5 1 10 1 2 8 1661 2203 138 45 92.951134 ADEQ
5 1 10 1 2 9 1824 2203 70 36 96.860466 and
5 1 10 1 2 10 1919 2202 103 37 96.548714 other
5 1 10 1 2 11 2043 2202 201 46 96.365883 regulators
4 1 10 1 3 0 522 2259 1722 47 -1
5 1 10 1 3 1 522 2260 188 44 96.239998 regarding
5 1 10 1 3 2 721 2260 146 36 96.342659 Interim
5 1 10 1 3 3 878 2261 105 35 96.508446 WRF
5 1 10 1 3 4 996 2260 219 44 96.307838 operations;
5 1 10 1 3 5 1228 2260 174 44 96.570908 provided
5 1 10 1 3 6 1413 2260 75 36 96.893105 that
5 1 10 1 3 7 1498 2260 207 46 96.021660 Developer
5 1 10 1 3 8 1716 2260 93 36 95.402733 shall
5 1 10 1 3 9 1820 2272 95 32 96.523254 copy
5 1 10 1 3 10 1927 2260 83 44 96.936249 City
5 1 10 1 3 11 2023 2272 50 24 96.702278 on
5 1 10 1 3 12 2082 2259 162 37 96.732361 material
4 1 10 1 4 0 522 2317 1722 47 -1
5 1 10 1 4 1 522 2318 141 35 96.635666 written
5 1 10 1 4 2 679 2317 327 36 95.560905 communications
5 1 10 1 4 3 1023 2317 153 47 96.831345 relating
5 1 10 1 4 4 1192 2323 36 30 96.990028 to
5 1 10 1 4 5 1246 2317 44 46 81.292610 (1)
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5 1 10 1 4 9 1611 2317 116 36 96.323738 actual
5 1 10 1 4 10 1743 2318 132 45 96.684181 permit
5 1 10 1 4 11 1890 2317 189 44 97.010498 violation,
5 1 10 1 4 12 2098 2317 58 45 94.573944 (ii)
5 1 10 1 4 13 2174 2329 70 33 96.158737 any
4 1 10 1 5 0 523 2374 1722 47 -1
5 1 10 1 5 1 523 2375 246 36 96.296349 enforcement
5 1 10 1 5 2 782 2375 121 36 96.829033 action
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5 1 10 1 5 4 967 2375 122 36 96.101730 notice
5 1 10 1 5 5 1101 2374 47 37 97.013733 of
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5 1 10 1 5 10 1639 2375 183 46 96.441841 requiring
5 1 10 1 5 11 1834 2374 210 37 96.466881 immediate
5 1 10 1 5 12 2058 2374 132 44 96.904045 action,
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4 1 10 1 6 0 523 2432 1656 47 -1
5 1 10 1 6 1 523 2433 69 46 96.762016 (iv)
5 1 10 1 6 2 608 2444 69 35 96.450356 any
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5 1 10 1 6 4 912 2433 228 46 96.452087 suspension,
5 1 10 1 6 5 1155 2433 219 43 96.452087 revocation,
5 1 10 1 6 6 1390 2444 41 24 96.774109 or
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5 1 10 1 6 8 1619 2432 255 36 96.723663 modification
5 1 10 1 6 9 1888 2432 47 36 96.761223 of
5 1 10 1 6 10 1942 2432 60 36 97.005119 the
5 1 10 1 6 11 2016 2432 163 36 96.368462 Permits.
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3 1 11 1 0 0 297 2548 1769 40 -1
4 1 11 1 1 0 297 2548 1769 40 -1
5 1 11 1 1 1 297 2548 23 36 69.489189 3
5 1 11 1 1 2 372 2548 311 36 69.489189 DEVELOPER
5 1 11 1 1 3 696 2548 349 36 95.919518 OBLIGATIONS
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5 1 11 1 1 5 1451 2548 341 40 96.062767 OPERATIONS;
5 1 11 1 1 6 1807 2548 259 40 96.432205 RECORDS)
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4 1 12 1 1 0 372 2585 1696 10 -1
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4 1 13 1 1 0 447 2661 1797 47 -1
5 1 13 1 1 1 447 2664 59 34 95.848068 3.1
5 1 13 1 1 2 523 2664 263 44 95.848068 Compliance.
5 1 13 1 1 3 896 2662 208 46 96.696007 Developer
5 1 13 1 1 4 1137 2662 92 36 96.193016 shall
5 1 13 1 1 5 1264 2674 108 24 96.242622 cause
5 1 13 1 1 6 1405 2662 59 36 96.576744 the
5 1 13 1 1 7 1499 2662 145 36 96.000076 Interim
5 1 13 1 1 8 1677 2664 105 34 95.579430 WRF
5 1 13 1 1 9 1818 2668 36 30 96.071114 to
5 1 13 1 1 10 1887 2662 48 36 96.433281 be
5 1 13 1 1 11 1968 2662 172 46 96.007835 operated
5 1 13 1 1 12 2175 2661 69 37 96.765526 and
4 1 13 1 2 0 522 2719 1723 47 -1
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5 1 13 1 2 2 768 2720 38 35 96.636406 in
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5 1 13 1 2 4 1088 2719 89 36 96.246773 with
5 1 13 1 2 5 1200 2719 216 46 96.246773 Applicable
5 1 13 1 2 6 1443 2721 94 42 96.612076 Law,
5 1 13 1 2 7 1566 2719 60 36 96.595329 the
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5 1 13 1 2 9 1844 2719 70 36 96.455948 and
5 1 13 1 2 10 1942 2719 108 36 96.437233 Good
5 1 13 1 2 11 2080 2719 165 45 96.769058 Industry
4 1 13 1 3 0 522 2776 1722 47 -1
5 1 13 1 3 1 522 2777 188 36 96.532043 Practices.
5 1 13 1 3 2 728 2777 208 46 96.746269 Developer
5 1 13 1 3 3 952 2777 92 36 96.232208 shall
5 1 13 1 3 4 1063 2788 128 25 96.940224 ensure
5 1 13 1 3 5 1207 2776 74 37 96.479073 that
5 1 13 1 3 6 1297 2789 21 24 96.979202 a
5 1 13 1 3 7 1334 2776 173 37 95.254211 Certified
5 1 13 1 3 8 1526 2778 176 45 95.254211 Operator
5 1 13 1 3 9 1718 2777 145 46 96.937660 serving
5 1 13 1 3 10 1880 2788 39 25 95.883583 as
5 1 13 1 3 11 1936 2776 60 36 96.959412 the
5 1 13 1 3 12 2013 2778 178 45 96.151680 Operator
5 1 13 1 3 13 2206 2776 38 36 96.738518 in
4 1 13 1 4 0 523 2834 1304 47 -1
5 1 13 1 4 1 523 2834 141 47 96.834076 Charge
5 1 13 1 4 2 678 2835 30 35 96.555260 is
5 1 13 1 4 3 723 2834 211 47 96.508041 designated
5 1 13 1 4 4 950 2839 34 31 96.689171 at
5 1 13 1 4 5 999 2834 47 36 96.689171 all
5 1 13 1 4 6 1061 2835 107 36 96.783226 times
5 1 13 1 4 7 1182 2834 60 36 96.654373 the
5 1 13 1 4 8 1256 2835 143 35 94.601624 Interim
5 1 13 1 4 9 1412 2836 106 34 89.960571 WRF
5 1 13 1 4 10 1533 2834 32 36 96.883888 is
5 1 13 1 4 11 1579 2835 38 35 96.882698 in
5 1 13 1 4 12 1631 2835 196 46 96.180412 operation.
3.2 Operator Contract. Developer shall maintain an Operations Agreement with Operator
requiring, at a minimum, (a) compliance with Applicable Law and the Permits, (b)
emergency response and coordination protocols, (c) designation of an Operator in
Charge who is a Certified Operator at all times the Interim WRF is in operation, and
(d) transition cooperation in the event of replacement, step-in, or takeover.
3.3 Records; Reporting. Developer shall cause Operator to maintain complete and
accurate operational and compliance records, and shall provide City, upon reasonable
request, copies of: discharge monitoring reports, monthly operating reports, laboratory
data, and maintenance logs reasonably necessary for City’s oversight and utility
administration.
3.4 No Ordinance Enforcement Obligation. Developer and Operator shall have no
obligation to enforce City ordinances against Users. City retains its enforcement
authority and agrees to reasonably coordinate with Developer upon request where User
discharges may be causing compliance impacts.
4 COMPENSATION, INVOICING, AND PAYMENT
4.1 Compensation Structure
Prior to the connection of the first residential User to the Interim WRF, Developer shall
pay Operator, on a monthly basis, the Service Fee for routine O&M Services and any
approved Other Expenses, as invoiced monthly by Operator in accordance with the
Operations Agreement.
Upon the connection of the first residential User to the Interim WRF, the City shall collect
User Fees from Users for wastewater service, as established by the City Residential Sewer
Rates. Within thirty (30) days after the end of each calendar quarter, the City shall remit to
Master Developer all User Fees collected during the preceding quarter. Developer shall be
responsible for paying Operator the Service Fee and any Other Expenses, in accordance
with the terms of the Operations Agreement. City and Developer acknowledge and agree
the User Fees collected from Users for wastewater service during the operation of the
Interim WRF is the only compensation Developer shall receive from the City for the
management and operation of the Interim WRF.
4.2 Service Fee Adjustments. The Service Fee may be adjusted due to Change in Law,
Scope Change Adjustment, or Force Majeure, or by mutual agreement by the Parties.
4.3 User Fees; Collection System Allocation. The Parties acknowledge that Developer
is entitled to full recapture of all User Fees collected during the preceding quarter. The City
shall, on a quarterly basis, remit to Developer all User Fees collected, less the portion of
User Fees attributable to the Floreo at Teravalis Collection System repair and maintenance
costs as established by the City's rate schedule ("Collection System Fees"), which shall be
retained by the City. The City shall be solely responsible for all repairs to the Floreo at
Teravalis Collection System, which the Parties acknowledge is owned by the City.
Developer shall cause Operator to perform routine maintenance of the Floreo at Teravalis
Collection System, including but not limited to periodic flushing of lines, in accordance
with the Operations Agreement. For the avoidance of doubt, routine
5 1 1 1 3 11 1861 438 266 36 93.556641 maintenance does
not include structural repairs, rehabilitation, or replacement of any component of the Floreo
at Teravalis Collection System.. The provisions of this Section 4.3 shall survive the
expiration or earlier termination of this Delegation Agreement and shall remain in effect
until Developer has been fully paid. The City shall perform an annual reconciliation of
User Fees collected against the Service Fees and Other Expenses actually paid to Operator.
5. CITY RESPONSIBILITIES
5.1 Cooperation. City shall cooperate with Developer to facilitate timely performance
and continuity of service.
5.2 Inspections and Agency Coordination. City shall cooperate with ADEQ, MCESD,
EPA, and other agencies during inspections and information requests relating to the Interim
WRF, and shall coordinate with Developer regarding scheduling and access.
5.3 Collection System Ownership and Repair. The Parties acknowledge that the Floreo
at Teravalis Collection System has been accepted and is owned by the City. Upon the
expiration of all applicable Developer warranty’s relating to the Teravalis Collection
System the City shall be solely responsible, at its cost, for all repairs, rehabilitation, and
replacement of the Floreo at Teravalis Collection System, including without limitation
correction of line defects, grade failures, structural damage, and manhole repairs. Nothing
in this Delegation Agreement shall be construed to transfer or delegate to Developer or
Operator any obligation for repair or replacement of the Floreo at Teravalis Collection
System. During the initial two (2) year period following the City's acceptance of the Floreo
at Teravalis Collection System, repair obligations arising from construction defects shall
be addressed under the applicable trade warranties. Following expiration of such
warranties, repair obligations shall be borne solely by the City.
6. TERMINATION, DEFAULT, REMEDIES
6.1 General Provisions. A party will be in Default of this Delegation Agreement when it
fails to cure an Event of Default after notice. Upon a Default of this Delegation Agreement,
the non-defaulting party will have all remedies available at law or equity, except as
modified in this Delegation Agreement.
6.2 Default. Except for emergencies, failure or unreasonable delay by either party to
perform or otherwise act in accordance with any term or provision of this Delegation
Agreement for a period of thirty (30) days after written notice thereof from the other party
(“Cure Period’), shall constitute a default under this Delegation Agreement (“Event of
Default’); provided, however, that if the failure or delay is such that more than thirty (30)
days would reasonably be required to perform such action or comply with any term or
provision hereof, then such party shall have such additional time as may be necessary to
perform or comply so long as such party commences performance or compliance within
said thirty (30) day period and diligently proceeds to complete such performance or fulfill
such obligation. Said notice shall specify the nature of the alleged default and the manner
7
in which said default may be satisfactorily cured, if possible. If such default is not cured
within the Cure Period, the non-defaulting party shall have the right to pursue all remedies
available at law or in equity, including, without limitation, the right to exercise Step-In
Rights as set forth in Section 6.3 if applicable, the right to initiate the Dispute Resolution
Process set forth in Section 6.4, and/or the right to terminate this Delegation Agreement.
Nothing in this Section shall limit the right of Developer to exercise Step-In Rights
immediately in the event of an emergency or as otherwise provided in Section 6.3.
6.3 Step-In and Operator Replacement Rights.
6.3.1 Step-In Triggers. In addition to any other rights and remedies under this
Delegation Agreement, a “Step-In Event” shall be deemed to occur upon: (a) An
Event of Default by Developer or Operator that is not cured within the applicable
Cure Period; (b) Any event or circumstance that, in the reasonable judgment of
Developer, poses an imminent threat to public health, safety, or the environment;
(c) Suspension, revocation, or material limitation of any permit or license required
for operation of the Interim WRF due to Developer or Operator’s act or omission;
(d) Regulatory action or order requiring immediate action; or (e) Developer or
Operator’s insolvency, bankruptcy, or cessation of operations.
6.3.2 Pre-User Connection Stage. Upon the occurrence of a Step-In Event prior
to residential User connection to the Interim WRF, Developer shall have the
exclusive right, but not the obligation, to step in and assume, or appoint a third party
to assume, all or any portion of Operator’s obligations under the Operations
Agreement. Operator shall immediately and fully cooperate with Developer,
including providing access to the Interim WRF and any and all materials necessary
for continued operation required to effectuate the transition.
6.3.3 Post-User Connection Stage.
(a) Pre-Approved Vendor List: Upon execution of this Delegation Agreement,
Developer shall provide the City with a list of pre-approved, qualified operators
(“Pre-Approved Vendor List”) eligible to serve as replacement operator in the event
of a Step-In Event. The City shall review and approve the Pre-Approved Vendor
List, such approval not to be unreasonably withheld, conditioned, or delayed. The
Pre-Approved Vendor List may be updated from time to time by mutual written
agreement of the Parties.
(b) Developer Priority Step-In Right: Upon the occurrence of a Step-In Event after
residential user connection to the Interim WRF, Developer shall have the priority
right, but not the obligation, to step in and assume, or appoint a replacement
operator from the Pre-Approved Vendor List to assume, all or any portion of
Operator’s obligations under the Operations Agreement. Developer shall exercise
this right by providing written notice to the City within ten (10) business days after
occurrence of the Step-In Event. If written notice is not provided to the City within
ten (10) business days after occurrence of the Step-In Event, the City may step in
and assume, or appoint a third-party to assume, all or any portion of Operator’s
obligations under the Operations Agreement.
6.3.4 Notice and Emergency. Except in an emergency where immediate action is
required to protect public health, safety, or the environment, the party invoking
step-in rights shall give prompt written notice to the other parties of the Step-In
Event and the intended exercise of step-in rights.
6.3.5 Financial Protections. During any period of step-in by the Developer or City,
Operator shall remain liable for all costs, losses, and damages incurred by the City
and/or Developer as a result of Operator’s default, including any excess costs of
operation above the Service Fee. The City and/or Developer may offset such costs
against any amounts otherwise due to Operator under the Operations Agreement.
6.3.6 Termination for Convenience. Developer may terminate this Delegation
Agreement, in whole or in part, any time and for any reason, upon sixty (60) days’
prior written notice to the other parties. In the event of such termination, the City
shall pay to Developer all User Fees due and owing to Developer for the
management and operation of the Interim WRF performed through the effective
date of termination.
6.3.7 Continuation of Management and Operation upon Termination. Upon
termination of this Delegation Agreement for whatever cause and regardless of
fault, Developer will continue to provide the services anticipated by the Operations
Agreement for a period of up to one hundred eighty (180) days, or such lesser time
as Developer may specify, for transition of operations back to another operation
and maintenance contractor designated by Developer.
6.3.8 Cooperation and Transition. Upon the occurrence of a Step-In Event or
transition of operations, Developer shall:
(a) Deliver to City all original Permits, compliance files, and regulatory
correspondence;
(b) Execute all documents necessary to transfer, assign, or co-designate the City as
the permittee on all ADEQ Permits;
(c) Provide City and its replacement operator with immediate access to the Interim
WRI; and
(d) Notify ADEQ in writing of the City’s assumption of operational control to
ensure there is no gap in permit coverage that would require a cessation of service.
6.4 Dispute Resolution Process. Disputes shall be resolved by binding arbitration in
Maricopa County, Arizona, in accordance with the Commercial Arbitration Rules of
the American Arbitration Association.
7. INDEMNITY, FORCE MAJEURE, CHANGE IN LAW
7.1. Indemnity
7.1.1 Indemnification by Master Developer. To the fullest extent permitted by
law, Master Developer shall indemnify, defend (with counsel reasonably acceptable
to the City), and hold harmless the City, and its respective direct and indirect
affiliates, officers, directors, managers, members, partners, employees, agents,
successors, and assigns (collectively, the “City Indemnified Parties”) from and
against any and all Losses arising out of, relating to, or resulting from: (a) any act
or omission of Master Developer, or Operator in connection with the performance
or non-performance of the Operations Agreement or this Delegation Agreement;
(b) any breach of this Delegation Agreement by Master Developer; (c) any violation
of law or Permit by Master Developer or Operator; or (d) any injury to or death of
any person, or damage to or loss of property, caused by the acts or omissions of
Master Developer or Operator; except to the extent such Losses are caused by the
gross negligence or willful misconduct of a City Indemnified Party.
7.1.2 Indemnification by the City. The City shall indemnify, defend, and hold
harmless Master Developer and its affiliates, officers, directors, employees, agents,
successors, and assigns from and against any and all Losses to the extent arising
from the gross negligence or willful misconduct of the City.
7.2 Force Majeure.
7.2.1 Excuse of Performance. Except for payment obligations under this
Delegation Agreement, the performance of any party shall be excused during the
period and to the extent that such party is prevented from performing by a Force
Majeure Event, provided that such event was not caused solely or in substantial part
by an act or omission of the party seeking protection and the effects of which could
not have been prevented or avoided by reasonable effort of such party.
8. INSURANCE AND BONDS
8.1 Insurance. Master Developer shall cause the Operator to continuously maintain,
and require its subcontractors to continuously maintain, insurance coverages that
satisfy all the minimum policy limits and all other provisions in Exhibit “C” of the
Operations Agreement. All such policies shall name the City as an Additional
Insured. The insurance policies and policy limits required hereunder are minimums
and do not limit Master Developer’s or Operator’s liability. The failure of Master
Developer to cause the Operator or any subcontractor to continuously maintain
insurance coverages in compliance with this Section constitutes a material breach
of this Delegation Agreement.
8.2 O&M Performance Bonds. Master Developer shall cause the Operator to procure
Performance Bonds acceptable to the City on an annual basis to ensure performance
of the O&M Services under the Operations Agreement. The Performance Bonds
will be procured in the following amounts and shall be Best rated either “A” or
“A+” or otherwise acceptable to City:
8.2.1 Prior to the Initial Operational Acceptance Master Developer shall cause the
Operator to procure a Performance Bond, to be maintained from the Initial
Operational Acceptance until the first anniversary of the Initial Operational
10
Acceptance, in the amount of 150% of Operator’s estimated cost of one year of
operation and maintenance of the Interim WRF, as approved by the City.
8.2.2. Throughout the remaining term of this Delegation Agreement, beginning on
the first anniversary of the Initial Operational Acceptance, Master Developer shall
cause the Operator to procure annual Performance Bonds in the amount of 100%
of the previous year’s operation and maintenance costs, as approved by the City.
9. TERM
9.1 Initial Term. The term of the Delegation Agreement will commence upon the
commencement date of the Operations Agreement and, subject to any provisions for early
termination, will terminate on the fifth (Sth) anniversary of that date; provided, however,
that the term shall automatically be extended and continue in full force and effect so long
as the Interim WRF remains in operation and the Developer has not received full
reimbursement and recovery of all amounts owed to Developer by the City pursuant to this
Agreement.
9.2 Extension of Term. The Delegation Agreement may be extended by mutual written
agreement by the Parties.
10. MISCELLANEOUS
10.1 No Agency or Partnership. This Delegation Agreement shall not be deemed to create
a partnership, joint venture, or other business relationship between City and Developer.
10.2 Assignment. Developer may assign this Delegation Agreement to an affiliate or
successor developer of the Property with City’s consent not unreasonably withheld,
conditioned, or delayed; provided that Developer remains liable for obligations accruing
prior to assignment unless expressly released in writing by City.
10.3 Notices. All notices, requests, waivers, approvals, acceptances or other
communications under this Delegation Agreement shall be in writing and shall be deemed
given when personally delivered or transmitted through electronic mail or two days after
mailing by certified mail, return receipt requested and postage prepaid, to the addresses set
forth below:
For City: City of Buckeye
530 East Monroe Avenue
Buckeye, AZ 85326
Attn: Doug Sandstrom
With a copy to: Tosca Henry, City Attorney
530 East Monroe Avenue
Buckeye, AZ 85326
cityattorneysoffice@buckeyeaz.gov
For Master Developer /
Development Manager:
11
Trillium Management Development Company, LLC
c/o The Howard Hughes Corporation.
Attention: Charley Freericks, Vice President
4150 N. Drinkwater Blvd., Suite 100
Scottsdale, Arizona 85251
Email: charley. freericks@howardhughes.com
With a copy to:
c/o The Howard Hughes Corporation
Attention: General Counsel
9950 Woodloch Forest Drive, Suite 1100
The Woodlands, Texas 77380
Email: generalcounsel(@howardhughes.com
10.4 Governing Law. This Delegation Agreement shall be governed by and construed
under the laws of the State of Arizona.
10.5 Venue. Any litigation arising out of this Delegation Agreement shall be brought in
Maricopa County, Arizona.
10.6 Attorney’s Fees. The prevailing party in any litigation arising out of this Delegation
Agreement shall be entitled to its reasonable attorneys’ fees and costs.
10.7 Entire Agreement; Amendment. This Delegation Agreement constitutes the entire
agreement between the parties regarding the subject matter hereof and may be amended
only by a writing signed by both parties.
10.8 Severability. If any provision is declared void or unenforceable, the remaining
provisions shall remain in full force and effect if the remaining provisions permit the parties
to achieve the practical benefits of this Delegation Agreement.
10.9 Recording. City and/or Developer may record a memorandum of this Delegation
Agreement in the Official Records of Maricopa County.
[Signatures on the Following Page]
12
CITY OF BUCKEYE, a municipal corporation:
By:
Doug Sandstrom, City Manager
Date:
Attest:
Summer Stewart, Interim City Clerk
Approved as to Form:
Tosca Henry, City Attorney
STATE OF ARIZONA)
)
County of Maricopa )
The foregoing Delegation Agreement was acknowledged before me this day of
by Doug Sandsrom in his capacity of City Manager, on behalf of the City
, ,
of Buckeye, Arizona.
Notary Public
My Commission Expires:
13
DEVELOPER:
Trillium Management Development Company LLC,
a Delaware limited liability company
Cee
By: Charley Freericks
Its: Vice President
JUSTINE M. SCHRIMSHER
Nolary Public - Stale of Arizona
STATE OF ARIZONA) MARICOPA COUNTY
Commission # 676550
) Expires January 12, 2029
County of Maricopa )
[= ‘ES
The foregoing Delegation Agreement was acknowledged before me this day of
Avlee Zk, by CMacley_ Freerics, in his capacity as Vice President of Trillium
,
Management Development Company LLC. ° ‘
7
Notary/Public
My Commission Expires: ay {2&4 Ova7
(rues)
14
EXHIBIT “A”
Floreo at Teravalis Service Area
Service Area
PROPERTY BOUNDARY
15
EXHIBIT “B”
Floreo at Teravalis Interim WRF Site
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PAGE 1 OF 2 CAP ON 3" IRON PIPE Formerly HILGARTWILSON
_PROJ.NO.: WIS FLOREO 2
DATE: 2026 PARCEL 53 BOUNDARY Callen geen
SEP.
SCALE: NTS. BUCKEYE, ARIZONA
Paar ecectee so
DRAWNBY: GS PHOENIX, AZ 85016
EXHIBIT
CHECKED BY: BJB P: 602.490.0535 / F: 602,368 2436
DGG COWLES ENGINEE GUNG % DESIGN, INC UT ME GG IGACL TPG PARTE: SB BNE EXE dag vie
-
LINE TABLE
LINENO. | DIRECTION | LENGTH
|
Lt N60°10'20"W 316.30!
ae “4
2 N26°21’53°E 8.00'
+
L3 N45°29'18"E | 1005.16"
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LA N30°59'26"E 510.67'
|
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|
L6 N66°44°33°E $.00°
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L8 N88°20' aa"w » 15.00'
L9 $09°54'43"W 401.48'
|
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CURVE TABLE
| | | |
CURVE NO. RADIUS DELTA LENGTH
| |
971.48"
C1 3500.00’ 15°54'12"
|
C2 2100.00' 3°27'47" 126.93"
|
C3 1740,00° 24°54'43" | 756.54"
C4 1725, 00° | 8°18'27" 248.61"
BEARING:
RADIAL
R1 -N13°55'28"E
R2 - N88°20'44"W
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PAGE 2 OF 2 formerly HILGARTWILSON
_PROJ.NO.: A175 FLOREO
| Colliers Engineering
_OATE: SEP 2026 PARCEL $3 BOUNDARY * & Design
SCALE: NONE BUCKEYE, ARIZONA
_ 4742, N 24th Street, Suite 270
DRAWN BY: — GS PHOENIX, AZ 85016
IBIT
CHECKED BY: BB EXxH P: 602 $20,053. {Fé £02. 368.2436
G 2026. COLUERS FHCINEERING & DESIGN, INT IATIOT PES COVER IDC EGA MAR Bee CRE Ing We ghee
EXHIBIT “C”
Floreo at Teravalis Interim WRF Site
Insurance Requirements
For purposes of this Exhibit: (i) the term “Work” shall mean the entire scope of work, professional services, products
and/or other services performed, provided and/or furnished by or on behalf of Operator under a contract, agreement,
purchase order, addendum and/or work order, or as otherwise agreed to by Operator and Development Manager
(“Agreement”); (ii) the term Operator shall mean the party contracted or otherwise engaged to perform, provide
and/or furnish the Work, whether such party is identified as “Operator” or by another term, such as Contractor,
Consultant, Company, Vendor, Seller, Construction Manager, Engineer, or Architect or other term used to identify
such party; Gii) “Subcontractor” shall mean any person or entity that enters into a contract or agreement with or is
otherwise engaged by Operator to provide or furnish any portion of the Work, including without limitation, artisans,
suppliers, installers, fabricators and professionals (for clarity, the term Subcontractor includes lower-tier parties
contracting with Subcontractors to perform any part of the Work); (iv) the term Development
5 1 3 1 10 15 1875 1096 176 37 93.853394 Manager shall mean
the party entering into an agreement with or otherwise engaging the Operator to perform the Work, whether such party
is identified as “Development Manager” or by another term, such as Development Manager, Property Manager,
Operations Manager, Owner, Buyer, Landlord, or other term used to identify such party; and (v) the term
“Development Manager Insureds” shall mean (a) the Development Manager, (b) the owner(s) and lessee(s), as
applicable, of the real property on and/or for which the Work will be performed and, if any, its development manager
and property manager, (c) any lender providing financing secured by a lien against the Work or the real property for
which the Work will be performed, (d) City of Buckeye and their officials, and (e) each of their respective direct and
indirect parents, subsidiaries, affiliates, successors, assigns, and their current or future officers, directors, managers,
members, partners, shareholders, employees and agents, and (e) other parties reasonably requested by Development
Manager, including but not limited to parties with insurable interest in the Work and/or the real property accessed
during the Work. Capitalized but undefined terms used herein shall have those meanings ascribed to them in the
document(s) to which this Exhibit is attached.
1. Minimum Insurance Requirements for Operator.
1.1 Commercial General Liability (“CGL”).
$1,000,000 bodily injury and property damage occurrence limit
$2,000,000 general aggregate (other than products/completed operations aggregate)
$2,000,000 products-completed operations aggregate
$1,000,000 personal and advertising injury limit
CGL on an “occurrence” coverage form at least as broad as that provided under the Insurance Services Office (“ISO”)
form CG 0001 with coverage for bodily injury, broad form property damage, personal and advertising injury, premises
and ongoing operations, products and completed operations, contractual liability, and with a general aggregate limit
that applies per project, and with additional insured status for the Development Manager Insureds for both ongoing
operations and products-completed operations. The CGL must also (a) cover explosion, collapse, and underground
property damage, and (b) cover operations performed “within 50 feet” of a railroad, if applicable, and (c) utilize ISO
additional insured endorsement forms CG2010 10/01 and CG2037 10/01 or equivalent as approved by Development
Manager (or form CG2010 11/85 if commercially available), and (d) if and when the Work is performed in Hawaii,
include an endorsement confirming an occurrence will be defined to include coverage for a construction defect claim
arising out of the Work.
1.2 Workers’ Compensation and Employer’s Liability.
Workers’ Compensation Limits in accordance with the laws of the state or jurisdiction;
Employer’s Liability $1,000,000 accident, disease/employee and disease/policy limit
IncInding “other states” insurance so as to include all states not named on the declarations page of the insurance policy,
except for monopolistic states, and coverage shall include employer’s liability with separate limits. Operator shall
maintain workers’ compensation insurance regardless of eligibility for waiver or exemption of coverage under state
statute.
13 Business Automobile Liability.
$1,000,000 combined single limit
Placed on ISO form CA 0001 or equivalent covering the use or operation of any auto associated with the Work,
including autos owned, hired, non-owned or otherwise operated or used by or on behalf of Operator. If Work involves
remediation, removal or demolition of hazardous substances, the policy must contain current editions of endorsement
MCS-90 and CA 9948. In addition, either the auto or pollution policy shall include pollution liability for chemical
spills during auto use in conjunction with this Agreement..
1.4 Umbrella/Excess Liability.
$25,000,000 per occurrence
$25,000,000 general aggregate
$25,000,000 products-completed operations aggregate
Policies shall be excess to the commercial general liability, employer’s liability, and business automobile liability
coverages and shall be written as follow form or alternatively with a form that provides coverage that is at least as
broad as the primary insurance policies provided, however, a higher minimum limit of $30,000,000 is required if and
when the primary commercial general liability aggregate limits do not apply per project and location.
1.5 Pollution Liability.
$10,000,000 per occurrence and in the aggregate
To cover the testing, analysis, handling or remediation of known or suspected toxic or hazardous substances performed
by or on behalf of Operator and the policy shall not contain an endorsement or clause excluding the Work or excluding
such known or suspected toxic or hazardous substances. The policy must be on an “occurrence” form or the retroactive
date of a “claims made” policy must be equal to or prior to commencement of the Work. However, if and when the
Work involves extensive remediation, removal and/or demolition of hazardous substances a higher minimum limit of
$10,000,000 is required and Operator must evidence non-owned disposal site insurance as well as pollution liability
insurance from landfills or disposal sites utilized for the Work. This insurance shall provide cover losses and
associated legal defense caused by pollution conditions that arise from the operations of Operator described herein in
this Agreement and include coverage for: a) bodily injury, including sickness, disease, mental anguish or shock
sustained by any person, including death and any associated medical monitoring costs; b) property damage including:
(1) physical injury to or destruction of tangible property including the resulting loss of use thereof, (2) loss of use of
tangible property that has not been physically injured or destroyed, and (3) diminished third-party property value; and
(4) natural resource damages; c) cleanup costs (including both onsite and offsite), including costs to investigate,
quantify, monitor, mitigate, abate, remove, dispose, treat, neutralize, or immobilize pollution conditions and costs to
restore, repair or replace real or personal property, to substantially the same condition it was in prior to being damaged
during the course of responding to a pollution condition; d) pollution incidents associated with transportation, loading
and unloading of materials or waste; e) non-owned disposal sites coverage; f) affirmative coverage for
civil/administrative fines and penalties as well as for operations failures and Supervisory Control and Data Acquisition
(SCADA) systems vulnerabilities; g) defense including costs, charges and expenses incurred in the investigation,
adjustment or defense of claims for such compensatory damages with a minimum of 25% defense costs outside the
policy limits of insurance, h) emergency response cost and i) except for workers’ compensation/employer’s liability
and professional, no contractual liability exclusion shall apply. Coverage shall apply to sudden and non-sudden
pollution conditions including the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis,
toxic chemicals, liquids or gases, waste materials, silt, sedimentation, asbestos, lead-based paint, silica, low-level
radioactive material, mixed waste or other irritants, contaminants or pollutants into or upon land, the atmosphere or
any watercourse or body of water as a result of the operations of the Contractor described under the scope of services
of this contract. No exclusions for asbestos, lead paint, silica or mold/fungus/legionella and other communicable
diseases. Any insurance or self-insurance maintained by the Development Manager Insureds shall be excess of any
policies maintained by Operator.
1.6 Professional Liability.
$5,000,000 per claim and in the aggregate
To cover financial loss, bodily injury and property damage arising from errors and omissions committed in the
performance of or failure to perform professional services (which might include but are not limited to remediation
planning, architectural, engineering, design-build, media/marketing, technology, construction management,
consulting, surveying, testing, financial, etc.) by Operator or anyone directly or indirectly employed by Operator. The
policy must include coverage for contingent bodily injury and property damage without being subject to any sublimit
and the policy’s retroactive date must be equal to or prior to commencement of the Work and coverage shall include
cyber protection tailed for SCADA controls, failure to meet water standards and regulatory action defense.
1.7 Builder’s Risk. Coverage shall be provided by Development Manager.
1.8 Commercial Property / Contractor’s Equipment. To cover 100% of the value of all Operator-
supplied property for the Work including but not limited to equipment (stationary or mobile), machinery, tools
(including employee tools), supplies, materials or any other property owned, leased or the legal responsibility of
Operator. At the Operator’s option, this coverage may be self-insured; however, Development Manager provides no
insurance and is not responsible for loss damage or destruction.
1.9 Other Insurance. Such as cyber liability, employment practices liability, marine liability, non-
manned aircraft liability, crime/fidelity bond, etc. to insure Operator and Development Manager Insureds against
claims arising out of the Work.
2. Minimum Insurance Requirements for Subcontractors. Unless otherwise insured by Operator, Operator
shall cause its Subcontractors to (a) obtain and maintain separate insurance coverages with terms and conditions as
outlined herein with minimum limits of $1,000,000 (or such higher limit as otherwise required by Operator), and (b)
comply with the ADDITIONAL INSURED PROVISIONS, Section 3.1, and Waiver of Subrogation, Section 3.2.
3. General Requirements Applicable to Insurance.
3.1 ADDITIONAL INSURED PROVISIONS: To the fullest extent permitted by law, the policies of
commercial general liability “‘CGL”), business automobile liability, umbrella/excess liability and pollution liability
insurance shall include Development Manager Insureds as additional insureds with no restriction of coverage beyond
that which applies to the policyholder. Primary insurance, umbrella/excess insurance, self-insurance, retentions and
deductibles maintained by Operator and Subcontractor shall be primary to and shall not contribute with and shall not
apply as excess over other primary, umbrella/excess insurance, or self-insurance programs afforded the Development
Manager Insureds. The CGL policy must provide additional insured status for ongoing and products-completed
operations and Operator must evidence additional insured status as per Section 1.1(c).
3.2 Waiver of Subrogation. To the fullest extent permitted by law, Operator hereby agrees to waive
and shall require all Subcontractors of any tier to waive any rights of recovery from Development Manager Insureds
and all insurance policies carried by Operator or Subcontractors shall confirm or otherwise allow for such waiver of
subrogation without restricting or limiting coverage, whether such insurance policy is specifically required herein or
not. The parties intend for the foregoing waivers of subrogation to apply to deductibles and self-insured retentions
and to be effective through the running of applicable statute of limitations and statute of repose.
3.3 Certificates of Insurance. The insurance required herein may be satisfied by maintaining any
combination of primary policies and umbrella/excess policies written as follow form or with coverage at least as broad
as the primary policies. Upon the earlier of commencement of the Work or Operator’s execution of the Contract,
Operator shall furnish to Development Manager a certificate of insurance and other documents needed and/or
requested by Development Manager to evidence (a) active insurance policies required herein and the limits purchased
on each, which shall not be less than the minimum limits indicated herein, and (b) compliance with the ADDITIONAL
INSURED PROVISIONS, Section 3.1, and (c) compliance with the Waiver of Subrogation, Section 3.2, and (d) unless
waived in writing by Development Manager, thirty (30) days’ prior written notice of cancellation of insurance from
the insurance carrier to Development Manager. Evidence by means of approved “blanket” policy endorsements or
policy provisions is acceptable. A renewal certificate of insurance is required prior to expiration of any policy required
herein and upon Development Manager’s request.
3.4 Maintenance and Minimums. Operator shall procure and maintain the insurance coverages with
minimum policy limits and other provisions described herein at its expense for the duration of the Work, including
any extensions thereof or additions thereto, and through the running of applicable statute of limitations and statute of
repose (either through continuous renewal of insurance coverage or the purchase of an extended reporting period) with
insurance companies authorized to do business in the state where the Work is performed and rated by A.M. Best
Company with a rating of “A: VII” or higher. The insurance coverages, policy limits and other policy provisions