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HomeMy WebLinkAboutC&D Haul & Disposal Services Waste Management of New York 123 Varick Avenue Brooklyn, New York 11237A Waste Management Company one 718/388.7900 \4V 718/628.7090 ■ May 22, 1997 Office of Town Clerk Southold Town Hall 53095 Main Road Southold, NY 11971 RE: CONSTRUCTION & DEMOLITION DEBRIS (C&D) HAUL-DISPOSAL SERVICES Gentlemen: On behalf of WM of New York, Inc. d/b/a Waste Management of New York, I am pleased to submit our proposal for the CONSTRUCTION & DEMOLITION DEBRIS (C&D) HAUL-DISPOSAL SERVICES for the Town of Southold. We offer the Town a • viable solution to handle their material in a cost effective, environmentally safe manner. Acquired in March of 1996, WM of New York, Inc. is a wholly-owned subsidiary of WMX Technologies, Inc. of Oakbrook, IL. WMX holds 100% of stock for WM of New York, Inc. WM of New York, Inc. is the former Resource NE located at 123 Varick Avenue, Brooklyn,NY. WMX is the leader in the solid waste industry and is known for it's ability to develop innovative strategies and programs in response to solid waste management needs. Over the years, WMX and it's subsidiaries have entered into numerous contracts providing a wide variety of waste management services. The existing WM of New York, Inc. team has been active in the solid waste industry for over 40 years and employs approximately 700 people and manages ten Materials Recovery Facilities. WM of New York, Inc. operates a fleet of 200+trucks, moving approximately 4,500 tons of waste daily. WM of New York, Inc. is incorporated in the State of Delaware and holds all the necessary permits for the handling of Construction & Demolition Debris. WM of New York, Inc. operates three recycling facilities in New York, with a capacity of over 7,000 tons per day, in addition to 136 state-of-the-art "Subtitle D" Landfills throughout the United States. WM of New York, Inc.'s proposal covers the full scope of the Bid Proposal. • WM, if selected by the Town, is committed to performing all services required in the Bid and as described in the attached proposal for the price quoted. a DCA Lia#092852 DCA Lic.#0928528 a division of WM of New York, Inc. A Waste Management Company Town of Southold May 22, 1997 page 2 We thank you for the opportunity to submit a proposal to the Town of Southold and look forward to working with you. Sincerely, Charles P. Gusmano Director, Business Development • • r� i BIDDER'S SOLICITATION CONSTRUCTION MATERIAL AND/OR DEMOLITION DEBRIS (C & D) HAUL AND DISPOSAL SERVICES AGREEMENT DOCUMENTS TOWN OF SOUTHOLD STATE OF NEW YORK TOWN OF SOUTHOLD Prepared by: Solid Waste Task Force Technical Committee 53095 Main Road Southold, NY 11971 May, 1997 • NOTICE TO BIDDERS CONSTRUCTION & DEMOLITION DEBRIS (C&D) HAUL-DISPOSAL SERVICES The Town of Southold will receive sealed bids for construction and demolition debris haul-disposal services until the time and at the location herein specified which will then be opened and publicly read aloud; PLACE: Office Of the Town Clerk Southold Town Hall 53095 Main Road Southold, New York 11971 (516) 765-1800 DATE: Thursday, May 22, 1997 TIME: 1:00 P.M. EDST (LATE BIDS WILL NOT BE OPENED) • The offer to be made in accordance with this Bid Solicitation shall include a bid on the following: A bid price per ton, to provide equipment and labor for hauling construction and debris and disposing construction & demolition debris at the Contractor's Construction & Demolition Debris Disposal Site. The term of this Agreement shall be three (3) years commencing on July 10, 1997. The Town, at its sole discretion, shall have the option of renewing the Agreement for two additional one year terms by giving Contractor written notice of its intention to renew at least thirty (30) days prior to the expiration of the term. Bids must be made in writing on the forms furnished and shall be accompanied by a Bid Guaranty in the Form of certified check, money order, bank draft or standard form letter of credit made payable to Town of Southold, or bid bond, in the sum of one hundred thousand dollars ($100,000.00) wherein the named obligee shall be the Town of Southold. The successful Bidder shall be required to furnish a performance Bond, and insurance in accordance with the instructions in the Bid Solicitation. • 2 f The bid price shall not include any tax, Federal, state, or local, from which the Town of Southold is exempt. A Bidder may not withdraw his bid within forty-five (45) days after the opening of the bids, but may withdraw his Bid at any time prior to the scheduled time for the opening of bids. The Town reserves the right to reject any or all bids and to waive informalities, should this action be in the best interest of the Town of Southold. Bid Solicitation containing submission requirements, instructions, technical specifications, and bidding forms may be examined free of charge and at the following location on weekdays from 8:00 A.M. to 4:00 P.M.: Office Of the Town Clerk Southold Town Hall 53095 Main Road Southold, New York 11971 Upon payment of non-refundable fifty dollars ($50.00) Bid Solicitation may be picked up at: • Office of the Town Clerk Southold Town Hall 53095 Main Road Southold, New York 11971 Bidders will be allowed to ask questions regarding the Bid Solicitation during a pre-bid conference to be held at 10:00 A.M., Monday, May 12, 1997 at: Southold Town Hall 53095 Main Road Southold, New York 11971 All bidders are encouraged to inspect the Southold Town Transfer Station prior to the bid conference. Appointments to do so may be scheduled by calling James Bunchuck at (516) 734-7685. Judith T. Terry Town Clerk For further information regarding bidding requirements, contact Judith T. Terry (516) 765-1800. For information regarding Town Of Southold waste program and haul- disposal operations, contact James Bunchuck (516) 734-7685. 3 TABLE OF CONTENTS GLOSSARY OF TERMS 7 SECTION A - SUBMISSION REQUIREMENTS 10 1.0 Project Purpose 11 2.0 Schedule 11 3.0 Examination OF Agreement Documents 12 4.0 Information to be Submitted 13 4.1 Contractual Bid 13 4.2 Supplemental Information 14 5.0 Bid Format 15 5.1 Binding 15 5.2 Form Preparation 15 6.0 Submission of Bid 15 6.1 Withdrawal Of Bids 16 6.2 Questions & Addenda 16 7.0 Bid Guaranty 16 8.0 Execution Of Agreement 17 9.0 Consideration Of Bids 17 10.0 Selection Of Contractor 18 11.0 Acceptance of Bid 18 • 12.0 Assignment 18 13.0 Limitation Of Funds Available 19 14.0 Insurance and Bonds 19 14.1 Insurance 19 14.2 Bonds 20 15.0 Indemnity (Hold Harmless) 21 16.0 Payments 21 17.0 Default 22 18.0 Term of Agreement 22 19.0 Service Agreement 22 20.0 Subcontracts 22 21.0 Rights and Options 23 SECTION B - BID SPECIFICATION 24 1.0 Requirements 25 2.0 Program Goals and Objectives 26 3.0 Potential Regulatory and Operational Changes 26 4.0 Character Of The Construction and debris 26 4.1 Quality and Characteristics 27 5.0 Program Activities 27 • 5.1 Collection 27 4 • 5.2 Loading Mode 28 5.3 Town of Southold Accident and Damage Policy 28 5.4 NYSDEC Part 360 Permit to Operate 28 6.0 Haul Services 29 6.1 Work Included 29 6.2 Equipment 29 6.3 Weighings 30 6.4 Routing Mode - Contractor's Responsibility 30 7.0 Disposal Services Program Activities 31 7.1 Work Included 31 7.2 Operational Capacity 31 7.3 Permit Requirements 31 7.3.1 Disposal Sites Inside State Of New York 32 7.3.2 Disposal Sites Outside State of New York 33 7.4 Weighings 33 8.0 Safety and Health Regulations 34 9.0 Operations and Procedures 35 9.1 Supporting Data 35 SECTION C - TOWN OF SOUTHOLD CONSTRUCTION AND DEBRIS HAUL/DISPOSAL SERVICES 37 • 1.0 Intent 38 2.0 General Bid Statement 38 3.0 Unit Price Bid Schedule 42 3.1 Compensation 42 3.2 Evaluation Unit Bid Price Formula 43 4.0 Bid Security Acknowledgment 44 5.0 Information Schedules 44 Information Schedule A Information Schedule B Information Schedule C Information Schedule D Information Schedule E Information Schedule F Information Schedule G Information Schedule H Information Schedule I Information Schedule J Information Schedule K Information Schedule L Information Schedule M • 5 • SECTION D - APPENDICES Appendix A Sample Operating Agreement Appendix B New York State Department of Environmental Conservation Permit Appendix C Accident Report Appendix D Town of Southold SWMP (Executive Summary) Appendix E Town of Southold Overview of Transfer Station Operations • • 6 • GLOSSARY OF TERMS ADMINISTRATOR-- Shall mean the Coordinator of construction and demolition debris (or his agent) Of the Town of Southold, New York. AGREEMENT - Shall mean a Form operating agreement set forth by the Town and resulting from this Bid Solicitation between the Town of Southold and the successful Bidder to be executed in 1997. AGREEMENT DOCUMENTS - Shall include the notice to bidders, instructions, bid solicitation, bid Forms, information schedules, proposal, payment bond, bid bond, Agreement, performance bond, certificates of insurance, glossary of terms any general conditions or special conditions, and any addenda. The Agreement Documents will Form a part of the Agreement. AGREEMENT YEAR - Shall mean the period from July 10, of a calendar year to July 9, of the next calendar year. BIDDER - Shall mean any party or parties submitting in proper form a bid to perform the work as specified in the Agreement Documents. The successful Bidder selected by the Town to perform the specified work will thereafter be known as the Contractor. • BID PRICE - Shall mean the unit cost to determine the ranking of bidders. BID SOLICITATION - Shall mean this document, specifications, and any bid addenda issued. COMMENCEMENT DATE - Shall mean July 10, 1997. CONSTRUCTION MATERIALS AND/OR DEMOLITION DEBRIS (C&D) - Shall mean solid waste resulting from the construction, renovation, equipping, remodeling, repair and demolition of structures and roads. Such waste includes, but is not limited to, bricks, concrete and other masonry materials, soil, rock, wood, wall coverings, plaster, drywall, non-asbestos insulation and roofing shingles. CONSTRUCTION MATERIALS AND/OR DEMOLITION DEBRIS (C&D) DISPOSAL SITES - Shall mean any site designated by the Contractor where construction and demolition debris is disposed of in a manner that minimizes environmental hazards and is permitted under the design and operation requirements of 6 NYCRR Part 360 or alternatively outside the State of New York, is permitted under design and operation requirements meeting the requirements of 1) that jurisdiction's applicable regulatory agency and 2) Town of Southold's minimum standards. • GLOSSARY - 1 7 • CONTRACT DOCUMENTS - Shall have the same meaning as Agreement Documents. CONTRACT YEAR - Shall have the same meaning as Agreement Year. CONTRACTOR - Shall mean the party contracting to perform the work, or the heirs, executors, administrators, agents, or successors thereof. COORDINATOR - Shall mean the coordinator of construction and demolition debris for the Town of Southold. COUNTY - Shall mean Suffolk County, State Of New York. DAILY - Sunday to Saturday, inclusive. EPA - Environmental Protection Agency (Federal). HAUL-DISPOSAL SERVICES UNIT PRICE - Shall mean the Contractor's compensation in dollars for each ton of construction and demolition debris actually hauled from the Town Of Southold Transfer Station to the Contractor-Designated Disposal Site and disposed of at the Contractor-Designated Disposal Site. HAZARDOUS WASTE - Shall mean (1) any "hazardous waste" as defined under the • Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et sea.. or "hazardous substance" as defined under the comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601 et seq., or "hazardous waste" as defined under New York Environmental Conservation Law Section 27-0901 et seq., as each such law may be amended from time to time, and the regulations promulgated thereunder, and any analogous or succeeding Federal, state or local law, rule or regulation and regulations promulgated thereunder and (2) any other material which any governmental agency or unit having appropriate jurisdiction shall determine from time to time cannot be processed at the facility because it is harmful, toxic or dangerous. NOTICE OF AWARD - Shall mean written notice from the Town of Southold to the successful Bidder that the Town of Southold intends to award an Agreement to the successful Bidder, subject to compliance with all their terms and conditions of the Agreement Documents. NYSDEC - New York State Department Of Environmental Conservation. OSHA - Federal Williams-Steiger Occupations Safety & Health Act of 1970, plus subsequent revisions. • GLOSSARY - 2 8 • OWNER - Shall mean the Town Of Southold, New York. Also may be referred to as the Town. PERMIT - Shall mean any and all permits, licenses, approvals, certificates of public convenience and necessity, Franchises or authorizations which must be issued by any Governmental Body having jurisdiction thereof to legally enable the Contractor to transport and/or dispose Of construction and demolition debris. PERMITTEE - Shall mean any person issued a valid permit to haul construction and demolition debris or to construct, establish, maintain or operate a construction and demolition debris Disposal Site. RCRA - Resource Conservation Recovery Act (Federal). SOLID WASTE - Shall mean all putrescible and non-putrescible materials or substances, including but not limited to garbage, refuse, rubbish, ashes, agricultural wastes, and offal. (Solid Waste does not include C&D waste, recyclables, hazardous, or infectious waste). SOLID WASTE DISPOSAL SITE(S) - Shall mean any site designated by the Contractor where solid waste is disposed of in a manner that minimizes environmental hazards • and Is permitted under the design and operation requirements of 6 NYCRR Part 360 - Solid Waste Management Facilities, or alternatively outside of the State of New York, is permitted under design and operation requirements meeting the requirements of 1) that jurisdiction's applicable regulatory agency and 2) Town of Southold's minimum standards. Also may be referred to as Disposal Site(s). SUBCONTRACTOR - Shall mean an individual, firm or corporation having a direct contract with the Contractor for services, equipment, materials and/or labor. • GLOSSARY - 3 9 SECTION A SUBMISSION REQUIREMENTS BIDDERS INFORMATION, INSTRUCTIONS AND AWARD BASIS 1.0 PROJECT PURPOSE The Town of Southold expects that it will receive and need to dispose of approximately 5,000 tons of construction material and/or demolition debris during the agreement year. It is possible that the Town of Southold will contract with another town to receive and dispose of their construction material and/or demolition debris. If this happens the quantity of wastes to be hauled and disposed of under this Agreement will increase. This Bid Solicitation will ensure Town of Southold's construction and debris will continue to be 1) hauled From the Town of Southold Transfer Station to Disposal Site(s) and 2) disposed of at permitted Disposal Site(s). 2.0 SCHEDULE • The schedule below is an estimate of the time period leading up to the commencement of the Agreement. Its intent is to provide each Bidder with an idea of when certain events may occur. The dates given are guidelines and should not be construed as firm dates or deadlines due to the multiple parties involved in the decision making process. EVENT DATE Transfer Station Visits By Appointment Pre-Bid Conference May 12, 1997 Bid Opening May 22, 1997 Town Board Approval June 3, 1997 Agreement Executed On or Before June 25, 1997 Operations Commencement July 10, 1997 it . 3.0 EXAMINATION OF AGREEMENT DOCUMENTS, FAMILIARITY WITH THE WORK It is the responsibility of each Bidder before submitting a Bid to (a) examine the Sample Operating Agreement and Agreement Documents thoroughly; (b) visit the site of the Town of Southold Transfer Station; (c) attend and be familiar with the outcome of the pre-bid conference (d) become familiar with conditions at the Town of Southold Transfer Station and Disposal Sites that may affect cost, progress, performance or furnishing of the work; (e) become familiar with and consider all federal, state and local laws, regulations ordinances, permits, approvals and orders that may effect the cost, progress, performance or furnishing of the work; (f) study and carefully correlate the Bidders observations with the Agreement Documents; and (g) notify the Town Clerk of all conflicts, errors or discrepancies in the Agreement Documents. Reference is made to the following Appendices which contain supplemental information which is attached to and made part of the Agreement Documents: Appendix A: Sample Operating Agreement Appendix B: NYSDEC Part 360 Operating Permit • Appendix C: Town of Southold Accident Report Reference is made to the following Appendices which contain supplemental information which is attached to the Agreement Documents solely for the convenience of bidders: Appendix D: Solid Waste Management Plan Summary Appendix E: 1996 Cumulative Waste Summary Reference is made to the Following information which is available for review by Bidders at the Town Clerk's Office during normal business hours - 8:00 P.M. to 4:00 P.M. Monday through Friday. i. Pending conceptual plans for the proposed Town of Southold Transfer Station. ii. Town of Southold Solid Waste Management Plan. This information is presented solely for the convenience of the Bidders and does not constitute part of the Agreement Documents. Bidders shall form their own • conclusions and opinions from this information and shall confirm any information 12 • contained therein regarding facilities and equipment through site visits. The Town does not guarantee the accuracy of any information contained in these documents. Before submitting a Bid, each Bidder shall, at the Bidder's own expense, make or obtain any additional inspections, examinations, or studies and obtain any additional data and information which may affect cost, progress, performance or furnishing of the work and which Bidder deems necessary to determine its bid for performing and furnishing the work in accordance with the time, price and other terms and conditions of the Agreement Documents. The failure or omission of the Bidder to receive and examine any form, instrument or document, or make required inquiries and inspections, shall not relieve the Bidder from any obligation contained in the Agreement Documents. The Town will be justified in rejecting any claim based on facts or conditions of which the Contractor should have been cognizant. The submission of a Bid will constitute an incontrovertible representation by Bidder that Bidder has complied with every requirement of this Bid Solicitation, that without exception the Bid is premised upon performing and furnishing the work required by the Agreement Documents, and that the Agreement Documents are sufficient in scope and detail to indicate and convey understanding of all terms and conditions for performing and furnishing the work. • Bidders will be allowed to ask questions regarding the Bid Documents during the pre-bid conference to be held at: Town Hall 53095 Main Road Southold, New York 11971 May 12, 1997 at 10:00 A.M. 4.0 INFORMATION TO BE SUBMITTED WITH PROPOSAL 4.1 Contractual Bid For the purpose of assisting the Town in determining the responsible Bidders for this Bid Solicitation, the Bidder is required to submit the following minimum information with his bid: i. Contractor Bid Form ii. Bid Security or Bid Bond iii. Information Schedules A through M as applicable iv. Supplemental Information as described in 4.2 • 13 • 41.2 Supplemental Information In addition to the aforementioned forms, the Bidder is required to submit the following supplemental information with his bid: i. Operational Plan: A plan describing the Bidder's assessment of the requested operation set forth in Exhibit M. This section shall be divided into the following subsections: o Haul A detailed summary of requirements for manpower, materials and supplies, mobile equipment, etc., shall be included to provide the Town with general anticipated guidelines for performance under the Agreement. o Disposal A detailed summary of requirements of site capacity, useful life, hours and days of the week, operation, etc., shall be included to provide the Town with general anticipated guidelines for performance under the Agreement. A copy of the current Permits to Construct and Permits to Operate shall be included. If the Construction and debris Disposal Site is located • outside the State of New York, a copy of the current applicable laws and regulations governing the design, construction and operation of the Disposal Site shall additionally be included. ii. Litigation: A section briefly describing any current litigation which in any way may affect the Bidder's operational capability of useful life of the Disposal Sites. iii. Subcontractors: If the Bidder intends to use one or more subcontractors to complete any portion of the work, the Bidder must so indicate this intent in its Bid. The Bidder: is advised that any Agreement awarded will be contingent upon the use of the subcontractor(s) so identified. In the event that the Bidder desires to change the number or identity of such subcontractor(s), the proposed change must be submitted to the Town for approval. No such change shall be made without the Town's approval. In addition, it is the policy of the Town of Southold to encourage the participation of Minority Business Enterprises (MBE's) and Women- Owned Business Enterprises (WBE's) on Town projects. For this reason, the Agreement will require Contractor to use its best efforts to include among its subcontractors MBE and WBE firms. In the event the successful Bidder intends to subcontract in excess of twenty-five • percent (25%) of the work, the Bidder will be required to submit 14 to the Town an MBE/WBE Utilization Plan acceptable to the Town • prior to the Town's execution of the Agreement. iv. Disposal Site Subcontractor: In the event the Bidder does not own the Disposal Site identified in its Bid, the Bidder shall furnish a statement, signed by an authorized representative of the Disposal Site, which provides for Bidder's use of the site pursuant to this Bid Solicitation in accordance with the Agreement Documents. THE SUPPLEMENTAL INFORMATION REQUIREMENTS MAY BE SATISFIED BY INCLUDING A REFERENCE TO AN INFORMATION SCHEDULE (A-M) IF THE SCHEDULE PROVIDES THE INFORMATION REQUESTED AND IS INCLUDED IN THE BID. 5.0 BID FORMAT 5.1 Binding The document(s) if bound shall be in a manner that will provide for easy evaluation access (to lie flat when opened). Printing on both sides of the sheets, provided a quality paper is utilized that will prevent the type from showing through, is acceptable. Paper with substantial recycled content is preferred. • 5.2 Form Preparation Bids shall be submitted in the form described in this Bid Solicitation. All blank spaces for bid prices shall be properly filled in, in ink or typed, in both words and numerals for all bid categories required. In the event a price shown in words and its equivalent shown in figures do not agree, the written words shall be binding on the Bidder. BIDS SHALL NOT BE QUALIFIED, MODIFIED, LIMITED OR RESTRICTED IN ANY WAY. In the event a specification is not applicable, it shall be so indicated. Incomplete bids may not be considered, depending on the nature of the missing information. 6.0 SUBMISSION OF BID Each Bidder shall submit six (6) separate complete sets of his Bid which shall be enclosed in a sealed opaque envelope plainly marked on the outside with the title of the work and the name and address of the Bidder. No Bid will be considered unless filed on or before the time and at the place designated in the Notice to Bidders. Bids received after the time set for the opening will be returned to Bidders unopened. When sent by mail, preferably registered, the sealed Bid, marked as above, should be enclosed in an additional envelope similarly marked and addressed to: • 15 • The guaranty may be certified check, bank draft, money order, standard form irrevocable letter of credit, or a bid bond in the form attached. The bid bond shall be secured from a surety company authorized to do business in the State of New York as a surety. No Bid will be considered unless it is accompanied by the required guaranty, certified check, money order or bank draft must be made payable to the order of the Town of Southold. The bid bond shall name the Town as the obligee. Cash deposits will not be accepted. The bid guaranty shall ensure the execution of the Agreement and the furnishing of the surety bond or other required bonds by the successful Bidder, all as required by the Agreement Documents. All guaranties will be returned within ten (10) days after the execution of the Agreement and required bonds, insurance and other Agreement Documents are received from the successful Bidder. 8.0 EXECUTION OF AGREEMENT, FURNISHING OF BONDS The successful Bidder, or its legally authorized representative, shall be required to appear in person within ten (10) days of the Notice of Award by the Town at the place and time designated by the Town to execute the Agreement and other Agreement Documents for Haul/disposal services. The successful Bidder shall, at its own cost and expense, procure, • execute and deliver to the Town the following documents within ten (10) days of formal Notice of Award by the Town. Performance Bond - A Performance Bond shall be in an amount of one million dollars ($1,000,000.00). This bond (as shown by example in Section C, Schedule 5.01), shall be maintained at the Contractor's own expense for the term of the Agreement. Failure or refusal of the successful Bidder to execute and/or deliver such bond within the time designated, shall constitute a breach of such Bidder of the Agreement created by the Town's acceptance of the bid. In such event, the Town may determine that such Bidder has abandoned the Agreement and the Town shall be entitled to take action for any and all damages it may suffer as the result of such breach. The Town's rights in this regard shall include but not be limited to a claim against the bid bond provided. The Town specifically reserves any and all other rights against the Contractor as a result of his failure to perform as required by these documents. 9.0 CONSIDERATION OF BIDS The Town of Southold reserves the right to reject any/or all bids for haul and disposal services if such action is deemed to be in the best interests of the Town. • To be considered responsive to this Bid Solicitation, each Bidder shall: 17 • A. Provide equipment, labor, maintenance and management services to haul and dispose of construction and debris from the Town of Southold Transfer Station to Contractor designated Construction and debris Disposal Site(s) as set forth in Section B - Bid Specifications. B. Reserve and provide a minimum available capacity of 15,000 tons (52 weeks/year) yearly, allowing for seasonal and other peak periods. C. Provide evidence of all current valid state and Federal permits, licenses, local ordinances, etc., required by law to receive construction and debris at the designated Disposal Site(s). D. Provide evidence of physical and financial capability to perform services described in the bid specifications. 10.0 SELECTION OF CONTRACTOR Bids will be evaluated only if accompanied by the approved form of bid guaranty. Only bids solicited from firms or combinations thereof, who have sufficient management, engineering capabilities, operating, and maintenance experience to fulfill the Town's goals and comply with the applicable local, state, Federal laws, ordinances, regulations, e.g. New York State Department of Environmental Conservation, Resource • Conservation Recovery Act and Federal Environmental Protection Agency guidelines will be accepted. The Town will review the bids and make a selection recommendation based on the evaluation criteria included in this Bid Solicitation or take such other action as it deems in its best interest. Any agreement awarded hereunder will be to the responsible Bidder whose Evaluation Unit Bid Price is the lowest. The Town of Southold reserves the right, in its sole discretion, to reject all bids submitted in response to this Bid Solicitation. 11.0 ACCEPTANCE OF BID The acceptance of a Bid will be a Notice of Award signed by a duly authorized representative of the Town, and no other act of the Town shall constitute the acceptance of a Bid. The acceptance of a Bid shall bind the successful Bidder to execute the Agreement and other Agreement Documents. 12.0 ASSIGNMENT The successful Bidder to whom any Agreement shall be let, granted, or awarded shall not assign, transfer, convey, sublet, or otherwise dispose of the Agreement or of his right, title, or interest therein or his power to execute such • Agreement, to any person or corporation without the prior written consent of the Town. 18 • 13.0 LIMITATION OF FUNDS AVAILABLE The Contractor specifically agrees that any Agreement shall be deemed executory only to the extent of the funds appropriated for the purpose of the Agreement and that no liability shall be incurred by the Town beyond the funds appropriated on the date of execution of the Agreement by the Town for the said purpose. 14.0 INSURANCE AND BONDS 14.1 Insurance For the period from Agreement commencement date until one (1) year after Agreement termination date, Contractor must maintain insurance acceptable to the Town in the kinds and amounts set forth below. All such insurance coverage shall be provided by companies licensed to do business in New York State and the state in which the Disposal Site(s) is (are) located. The Town of Southold and its agent shall be named as an additional insured and coverage shall not be changed or cancelled until thirty (30) days written notice has been given to the Town. Within ten (10) days of the Notice of Award, Contractor shall furnish to the Town, certificates of insurance, in a form satisfactory to the Town Attorney, evidencing such insurance. The kinds and amounts of insurance are as follows: • A. Contractor's Insurance - Insurance for liability for damage imposed by law of kinds and in the amounts hereinafter provided covering all work under the Agreement, whether performed by Contractor or his subcontractors. The kinds and amounts of insurance are as follows: (1) Worker's Compensation Insurance - A Policy covering the operations of the Contractor in accordance with the provisions of Chapter 41 of the Laws of 1914 as amended, known as the Worker's Compensation Law, covering all operations Of the Contractor, whether performed by him or by his subcontractors. The Agreement shall be void and of no effect unless the person or corporation making or executing same shall secure compensation coverage for the benefit of, and keep insured during the life of said Agreement such employees in compliance with provisions of the Worker's Compensation Law. (2) General Liability (Comprehensive Form) Insurance - Contractor's liability insurance issued to and covering legal liability of the Contractor with respect to all work performed by him under the Agreement. The following insurance coverage shall be included: • 19 • of the Town of Southold. The standard form irrevocable letter of credit shall be in a form acceptable to the Town of Southold. In the event the Contractor secures a Performance Bond from any of its subcontractors, said bond shall also name the Town of Southold as a dual obligee. Should the Town designate another public or private gent of contract administrator, the same or others shall be added as additional named obligee at no added costs to the Town, upon written request from the Town. 15.0 INDEMNITY (HOLD HARMLESS) Contractor shall agree to defend, indemnify and save harmless the Town against any and all liability, loss, damage, detriment, suit, claim, demand, cost, charge, attorney's fees and expenses of whatever kind or nature which the Town may directly or indirectly incur, suffer or be required to pay by reason of or in consequence of the carrying out of or the performance of the terms of such Agreement, or the failure to carry out any of the revisions, duties, services or requirements of such Agreement, whether such losses and damages are suffered or sustained by the Town directly or its employees, licensees, agents, engineers, citizens or by other persons or corporations, including any of the Contractor's employees and agents who may seek to hold the . Town liable therefor. This indemnity shall include any and all claims, penalties or other losses or damages incurred by the Town as a result of enforcement or other proceedings by Federal, state or local government agencies relating to Contractor's Disposal Site(s) operation. This obligation shall be ongoing, survive the term of the Agreement and include, but not be limited to, claims concerning non-sudden environmental impairments. The Bidder agrees to join in the commencement of any action or proceeding or in the defense of any action or proceeding which in the opinion of the Town constitutes actual or threatened interference or interruption with the Town's rights hereunder, including all necessary appeals which may be necessary, in the opinion of the Town. 16.0 PAYMENTS Contractor shall receive monthly payments for services performed during the prior calendar month upon submission of an invoice (with a Town voucher) that shall contain an itemized list of construction and debris haul trips from the Town of Southold Transfer Station including the tonnage of construction material and/or demolition debris and the manifest number for each load of construction and debris removed. Such payments shall be made within sixty (60) days of the Town's approval of Contractor's invoice. Contractor's monthly invoice shall include a daily summary of • tonnage received by Contractor at the Transfer Station. The Town shall be entitled to 21 • deduct from any payment owing to Contractor any sums expended by the Town to cure any default or other non-compliance by Contractor. 17.0 DEFAULT In the event the Contractor fails to perform its obligations under the Agreement, the Town may terminate such Agreement, and the Town may procure the services from other sources and hold the Contractor responsible for any excess costs incurred and deduct from payments owing to the Contractor and/or draw upon the Performance Bond as full or partial reimbursement for such excess costs. The Town reserves the right to terminate the Agreement for just cause. 18.0 TERM OF AGREEMENT The term of this Agreement shall be three (3) years commencing on July 10, 1997. The Town, at its sole discretion, shall have the option of renewing the Agreement for two (2) additional one (1) year terms by giving Contractor written notice of its intention to renew at least thirty (30) days prior to the expiration of the term. 19.0 SERVICE AGREEMENT • The Contractor shall be obligated to provide the Town with disposal services without regard to the permit status of its Disposal Site. In the event that Bidder wishes to submit a bid for a Disposal Site for which Bidder does not currently have all necessary federal and state permits, Bidder shall, at its sole risk and expense, be responsible for obtaining and/or renewing its permits or providing to the Town an alternate Construction and debris Disposal Site at no additional cost (disposal plus any additional hauling) to the Town. This is a full service Agreement and failure of the successful Bidder to provide the identified Disposal Site or acceptable alternative Disposal Site, on or after the commencement date for services under the Agreement Documents awarded hereunder shall constitute a breach of this Agreement. The Bidder accordingly shall not be excused from it obligations hereunder by reason of any failure to obtain or maintain its permits at the identified Disposal Site. • 20.0 SUBCONTRACTS In the event Bidder does not own the Disposal Site identified in its bid prior to execution of the Agreement, Bidder shall: (1) furnish to the Town a copy of the signed Agreement between Bidder and the Disposal Site Contractor which provides for Bidder's use of the site pursuant to this Bid Solicitation in accordance with the Agreement Documents; • 22 • (2) require the Disposal Site Contractor to furnish to Contractor and the Town a performance bond guaranteeing the availability of the Disposal Site throughout the term of the Agreement; (3) require the certificates Contractor to provide insurance naming the Town as additional insureds on all policies maintained by Contractor. 21.0 RIGHTS AND OPTIONS The Town of Southold, New York, reserves and holds at its discretion the following rights and options upon issuing this Bid Solicitation: 1. To award an Agreement to the candidate whose bid is judged to be the lowest responsible bid pursuant to Section 103 of the General Municipal Law of the State of New York. 2. To reject any and/or all bids. 3. To issue subsequent bid solicitations. 4. To issue additional and subsequent solicitations for statements of • qualifications, and conduct investigations or interviews with respect to the qualifications of each Bidder. 5. To designate another public body, private or public agency, group, or authority to act in its behalf for evaluation and Agreement negotiations. 6. To designate another public body, private or public agency, group, or authority to act in its behalf for contract administration of this project at any time during the Agreement period. • 23 SECTION B BID SPECIFICATIONS (TECH NICAUMANAGEM ENT) • • 24 • SECTION B BID SPECIFICATIONS TECHNICAL/MANAGEMENT 1.0 REQUIREMENTS This request for bids is issued for the Town of Southold, State of New York, Town Hall, 53095 Main Road, Southold, New York, 11971 (Telephone (516) 765-1800) The effort, shall be known as the Town of Southold Construction Material and/or Demolition Debris Haul Disposal Service. The Town of Southold desires to issue an Agreement with a qualified Contractor to haul and dispose of a portion of its Construction and Debris. The Town will need to dispose of approximately 5,000 tons of construction and debris during the agreement years. The Contractor will ensure the Town that construction debris will continue to be; 1) hauled from the Town of Southold's transfer Station to disposal site(s), and; 2) disposed at permitted disposal site(s). The following general services are sought in this request: • • HAUL Provide equipment, labor, maintenance, management and policies to operate a transportation system for hauling construction and debris from the Town of Southold transfer Station to Contractor designated disposal site(s) as set forth herein. Transportation equipment shall be in accordance with New York State Department of Transportation, Interstate Commerce Commission, United States Department of Transportation, as defined in the Code of Federal Regulations, or other applicable state and federal regulatory requirements. • Disposal Reserve capacity and provide equipment, labor, maintenance, management and policies to receive and dispose of construction and debris from the Town of Southold Transfer Station as set forth herein. The Contractor's New York State Construction and debris Disposal Site(s) must be in compliance with all State of New York Department Of Environmental Conservation's and U.S. Government's Regulatory requirements, e.g., 6 NYCRR Part 360, Resource Conservation Recovery Act (RCRA), Environmental Protection Agency - Subtitle D, et al. • Disposal Sites outside New York State shall be permitted by applicable 25 local, state and Federal laws including RCRA and Subtitle D and regulations deemed by the Town to be no less protective of the environment than those outlined in this specification. Disposal alternatives that will be considered include land disposal, incineration, composting, etc., as long as they comply with regulatory requirements and environmental standards. 2.0 PROGRAM GOALS AND OBJECTIVES The goal of this project is the continued safe and reliable hauling and disposal of the construction and demolition debris from the Town Of Southold Transfer Station at minimum cost to the citizenry. It is also the objective of the Town of Southold to ensure that the haul- disposal operations proceed according to the provisions of this document and subsequent agreements/amendments are upheld. 3.0 POTENTIAL REGULATORY AND OPERATIONAL CHANGES During the term of the Agreement, there may be a number of regulatory and operational changes which may Affect the quantities and types of construction and debris received at the Town of Southold Transfer Station and delivered to the Disposal Site. This Agreement will not provide any guarantees with respect to the volume of waste to be hauled and/or disposed of by Contractor. The Town reserves the right to designate another public body, private or public agency, group or authority to act in its behalf for administration of the Agreement at any time during the term of Agreement. 4.0 CHARACTER OF THE CONSTRUCTION AND DEBRIS The wastes which are to be hauled and disposed of under terms of this bid solicitation are to include typical municipal wastes from a rural community. This will include all wood, sheet rock, shingles, insulation, concrete, bricks, metal, and other items generated by the construction industry. It could also include items generated by renovation activities such as broken furniture, small appliances, carpets, and other like items, as allowed under 6 NYCRR Part 360. It should not include typical household garbage other than what might be generated by construction work crews at construction sites during coffee breaks, lunch breaks, etc. Nor should contraction material and/or demolition debris include any wastes covered by special waste permits • such as pathogenic or hazardous materials, but the Town cannot guarantee 26 • that the waste stream does not contain same. Special costs associated with handling non-compliance loads will be compensated under Forced Accounting (Appendix A-9). 4.1 Quality and Characteristics The Town Of Southold's historical construction and debris quantities and characterization data are included in the Appendices. Bidders are cautioned that actual quantities may differ significantly from these data. Recycling programs may affect the quantity and characteristics of the waste received at the Town of Southold Transfer Station. If the Contractor discovers any non-compliance waste (hazardous, regulated medical or special wastes), the Contractor shall notify the Town and dispose of the noncompliance waste in accordance with local, state and Federal regulations. Compensation for such waste disposal services shall be provided for under Forced Accounting (Appendix A-9). The Town makes no specific representations in the foregoing disclosure. 5.0 PROGRAM ACTIVITIES 5.1 Collection • The Town of Southold Transfer Station is open 7 days a week, except holidays, from 7:00 A.M. to 5:00 P.M. The Contractor will be expected to collect and remove construction and debris from the Transfer Station during the following hours: Monday through Friday 7:00 A.M. to 4:00 P.M., The Transfer Station is closed on the following holidays: New Year's Day Columbus Day Martin Luther King Day Election Day Lincoln's Birthday Veterans Day Presidents Day 1/2 day before Thanksgiving Easter Sunday Thanksgiving Memorial Day 1/2 day before Christmas Independence Day Christmas Labor Day 1/2 day before New Year's Day The Contractor must make transfer containers available for loading seven days a week, if requested, between 7:00 A.M. and 4:00 P.M. Removal of waste on • Sundays is frequently not required during the winter months. 27 • The Contractor will be expected to provide enough containers to empty the Transfer Station tipping floor on a daily basis, delivery and staging of an adequate number of containers for this purpose will be coordinated with Transfer Station Staff as needed. 5.2 Loading Mode The Contractor shall fully prepare transfer containers for loading, including assuring that container covers or empty containers are left open. Construction and Debris will be loaded by the Town at its Transfer Station using a front end wheel loader or backhoe. After loading, Contractor will bring transfer containers to the Town's truck scales for weighing to prevent overloading and to document haul and disposal tonnages. Contractor will then cover (tarp) his load prior to leaving the site. If required by any local, state or Federal regulations or law, the contractor shall line transport equipment with plastic prior to loading. This service shall be at the Contractor's expense and included in the unit price bid. 5.3 Town Of Southold Accident and Damage Policy The Contractor shall be required to prepare an Accident Report (See Appendix C) Of any accidents and/or damage that occur while performing services under the term of the Agreement. The Town of Southold shall immediately be notified of any major occurrences such as bodily injury of structural damage to the Town's Transfer Station. An Accident Report will be submitted to the Town within twenty-four (24) hours containing the date, time, location, and complete description of all incidents. The offending parts or representative/e thereof shall also be recorded and required to sign the accident/damage report prior to departing the Town of Southold Transfer Station. All accident and/or damage reports will be included in reports to the Town. 5.4 NYSDEC Part 360 Permit to Operate The Town Of Southold operates the Transfer Station under a New York State Department of Environmental Conservation (NYSDEC) Part 360 Permit to . Operate. A copy of NYSDEC Permit is included as Appendix B. 28 • 6.0 HAUL SERVICES For Construction and Debris Haul-Disposal Services Agreement, the following services will include the tasks, responsibilities and performance required as outlined herein. 6.1 Work Included The Contractor shall provide the following major essential services or equipment and any other nonspecified items, without limitations, to maintain a reliable haul services operation in a manner that will meet the needs of the Town of Southold. • Management and operation of a fleet to accommodate the transport of construction and debris from the Town transfer Station to Construction and Debris Disposal Site(s) in accordance with all local, state, and Federal regulations. • Financial liability and maintenance responsibility of transport equipment, i.e., dump trailers, transfer trailers bulk material containers, vehicles, personnel and services for open-top loading construction and debris hauling activities. • • Coordination of haul services with disposal services. 6.0 Equipment The Contractor shall provide reliable refuse handling and other essential ancillary equipment, along with personnel to operate and maintain a reliable haul services system in a manner that will satisfy the needs of the Town of Southold. The minimum level of haul services equipment acceptable to the Town to support the haul operation includes open-top trailers and bulk material containers. The Contractor will supply additional open-top trailers and containers, etc. The contractor must assure the Town that an adequate reserve supply of equipment exists to haul and dispose of the daily and seasonal construction and debris including unpredictable surges or delays due to inclement weather and that transport equipment storage requirements will meet the Town of Southold Transfer Station requirements. Each bidder is therefore responsible for familiarizing itself with the Town of Southold Transfer Station site, construction and debris, etc., to assure equipment compatibility. Transport equipment may be open-top bulk material containers, dump trailers, • roll-off containers or opentop transfer trailers, provided that all such equipment 29 is suitable for convenient loading given existing configurations of the Town of Southold Transfer Station. Transport equipment shall be: 1) Registered with the State of New York Department of Motor Vehicles or equivalent agency; 2) designed to preclude spillage of waste; 3) loaded within their design capacity and New York State Department of Transportation regulations; 4) well maintained in good working order. Corroded, defective, bent, deformed or punctured trailers, roll-off boxes, or other containers of waste materials shall not be utilized at any time. Suitable covers shall be provided and used while transporting construction and debris in open-top transport equipment. The bidder shall clearly indicate the quantity and type of transport equipment/vehicles it plans to use, their availability date, state of repair, and that such units are compatible with the Town of Southold Transfer Station scales and New York State DOT regulations, United States Department of Transportation, as defined in the Code of Federal Regulations, or equivalent. The Contractor will promptly remove from use any transport equipment/vehicle that does not conform with these requirements and replace it with an acceptable unit. The Contractor shall maintain its own off-site maintenance shop facilities for servicing the transport equipmentand vehicle fleet, unless it elects to • subcontract for these services. No major maintenance may be done at the Town of Southold Transfer Station site. 6.3 Weighings The Town of Southold will provide certified weighing at the Town of Southold Transfer Station. The Contractor will accept these weights for invoicing purposes. All weights will be generated on current certified weigh scales. 6.4 Routing Mode - Contractor's Responsibility Contractor will have the right to select the route(s) for travel from the Town of Southold transfer Station to the Disposal Site(s). Contractor warrants and guarantees that, in selecting and utilizing such route(s), Contractor will insure that it is not violating any applicable motor vehicle height (overpass clearance), motor vehicle weight restrictions, local ordinances or Interstate Commerce Commission regulations. Contractor will indemnify and hold the Town harmless from any claims, fines and other damages assessed upon or incurred by the Town as a result of any violations of applicable restrictions or regulations relating to the routes traveled by the Contractor. • 7.0 DISPOSAL SERVICES PROGRAM ACTIVITIES 30 • For Construction and Debris Haul-Disposal Service Agreement, the following disposal services will include the tasks, responsibilities and performance requirements as outlined herein. 7.1 Work Included The Contractor shall provide the following major essential services or equipment and any other nonspecified items, without limitations, to maintain a reliable disposal services operation in a manner that will meet the needs of the Town Of Southold. • Liability insurance, performance and payment bonds. • Safety equipment. 7.2 Operational Capacity The bidder shall identify in its proposal, the following information: • Disposal Site capacity. • • Flexibility of Disposal Site capacity to allow for seasonal variances in waste generation and sufficient to permit service in the tonnages bid. • Hours and days of the week that the designated Disposal Site will be open for receiving construction and debris from the Town of Southold, including weekends, holidays and special closure periods. 7.3 Permit Requirements Throughout the term of Agreement that may result from this Bid solicitation, the Contractor must maintain all current and valid local, state and Federal permits, licenses, or other authorizations, (either temporary and permanent) which are required by law to receive construction and debris at any and all Disposal sites designated by the bidder. Because of the varying terms of Construction and Debris Disposal Site permits, it is possible that a permit will expire during the term of Agreement. The responsibility of obtaining and/or renewing a permit to operate is solely upon the Contractor. In the event a Contractor fails to maintain or obtain any necessary current and • valid local, state and Federal permits, licenses, or other authorizations, allowing 31 • the lawful use of its designated Disposal Site then the Contractor will be solely responsible for obtaining the utilization of an alternate Construction and Debris Disposal Site at no additional cost to the Town including any additional hauling cost because of the location of the alternate Disposal site. Under no circumstances shall such a change in Disposal Site or failure or inability to obtain permits by the Contractor be considered a change in conditions. In the event the Contractor is unable to find an alternate Disposal Site, it shall be deemed to be in default of the Agreement and liable for damages, bonds forfeitures and other expenses as provided in the Agreement. In the event the individual and/or entity submitting a bid in response to this bid solicitation is not the individual and/or entity named as the permit holder on any necessary current and valid local, state or federal permits, licenses or other authorizations, required by law to receive construction and debris at any disposal site designated by the bidder or any alternate disposal site, the bidder is required to provide satisfactory evidence to the Town of Southold of a binding contractual relationship between the bidder and the permit holder which provides the bidder with the irrevocable right to utilize the construction and debris disposal site during the term of Agreement, or portion thereof, in a manner which is in complete compliance with this bid solicitation and the bidder's bid submission. The agreement between the bidder and the permit holder shall • include provisions that: 1. Provide Town with the right to discuss operational matters with the permit holder whenever necessary. 2. Require the permit holder to comply with directives of the Town which are consistent with and pursuant to the Agreement which shall result from this bid solicitation. 7.3.1 Disposal Sites Inside State of New York The Contractor's Construction and Debris Disposal Sites, if located within the State of New York, must be in compliance with all State of New York Department of Environmental Conservation's and U.S. Environmental Protection Agency regulators requirements, e.g., 6 NYCRR Part 360, Resource Conservation Recovery Act (RCRA), Environmental Protection Agency - Subtitle D, at al. The Construction and Debris Disposal Site must have valid construction and operating permits in accordance with all applicable laws in the jurisdiction in which it is located. It shall be permitted to accept Town of Southold construction and debris without violating applicable law. It shall meet the design, construction and operating requirements of all applicable laws in the jurisdiction where the disposal site is operating. 32 Disposal alternatives that will be considered include land disposal, incineration, composting, etc., as long as they comply with all the above governing regulators requirements and environmental standards. The use of Construction and Debris Disposal Sites shall be subject to the approval of the Town of Southold based upon review of information submitted with the bid describing in detail the nature of the disposal process and other information reasonably requested by the Town. No Disposal Site shall be acceptable unless it poses no significant threat to the environment and its design, construction and operation complies with all applicable laws. 7.3.2 Disposal Sites Outside State of New York The Contractor's Construction and Debris Disposal Sites, if located outside the State of New York must be in compliance with all the applicable local, state and Federal laws and regulations and U.S. Environmental Protection Agency regulatory requirements, e.g. Resource Conservation Recovery Act (RCRA), Environmental Protection Agency - Subtitle D, et al. The Construction and Debris Disposal Sites must have valid construction and operation permits in accordance with all applicable laws in the jurisdiction in which it is located. It shall be permitted to accept Town of Southold construction and debris without violating applicable law. It shall meet the design, construction and operating requirements of all applicable laws in the • jurisdiction where the disposal site is operating. Bidder must clearly specify their intended disposal alternatives and support same with copies of appropriate experience, site location, permits, agreements et al., as outlined in this bid solicitation. The use of Construction and Debris Disposal Sites shall be subject to the approval of the Town of Southold based upon review of information submitted with the bid describing in detail the nature of the disposal process and other information reasonably requested by the Town. The Contractor shall be solely and completely Responsible for any and all liability relative to contractor's failure to dispose of construction and debris at an approved site. 7.4 Weighings The Town will compensate the Contractor for waste material hauled and disposed of on a net tonnage basis (short tons = 2000 pounds). The certified weighings will be made at the Southold Town Transfer Station. The Disposal Site will accept these weights for invoicing purposes. All weights will be generated on current certified weigh scales. In the event of any dispute over differences in net weights between the Town • and Disposal Sites scales and weight records, the Town may make payment 33 • upon the weight it deems to be most correct, until the dispute is reconciled. Any claims for differences must be filed in writing within sixty (60) days of occurrence or the Town's calculation shall be deemed final and binding between the parties. 6.0 SAFETY AND HEALTH REGULATIONS The Contractor shall comply with all current Federal Department of Labor, Safety and Health Regulations under the Occupational Safety and Health Act, 1972 (PL 91-596) and Section 107, Agreement Work Hours and Safety Standards Act (PL 91-54). Specific consideration shall be given, but not limited to, the following major areas: a. Maintenance safety procedures - guards and Shields on dynamic equipment, guards, railings, electrical lockouts, vehicle wheelblocks, audio vehicle backup alarms, vehicle wheel chocks, etc. b. Employee safety orientation, education, teaching, first-aid training, cardiopulmonary resuscitation, etc. c. Noise and dust control, ear protection, respirators, hard-hats, safety shields, glasses, protective clothing, sanitary facilities, etc., • d. Fire and explosion preventions, control, equipment (fire blankets, extinguishers, first aid, hoses, etc.) and personnel escape alternatives. e. Traffic flow control patterns. f. Accident or injury reporting system (the Town shall received copies of all reports and immediate verbal notification). g. Employee health safeguards. h. Mechanic's lien safeguard against work interference. The Contractor shall comply with all local, state and Federal regulations, laws and statutes which apply to the work and to safety in particular. The Contractor shall comply with New York State Department of Labor current requirements. The Contractor shall be solely and completely responsible for operational safety during performance of the Agreement. The obligation exists twenty-four (24) hours a day, each and every day throughout the term of the Agreement. • 34 • The Town of Southold shall not have any responsibility for means, methods, sequences of techniques selected by the Contractor for safety precautions and programs, or for any failure to comply with laws, rules, regulations, ordinances, codes or orders applicable to the Contractor furnishing and performing the services under the terms of the Agreement. 9.0 OPERATIONS AND PROCEDURES The Contractor will be required, prior to commencement of operations, to provide the following operational plans to the Town for review and acceptance. Revisions, modifications, and updates shall be forwarded to the Town throughout the term of the Agreement. • Organization personnel and structure, showing the chain of command, names and telephone numbers and staffing requirements. • Operational plan - shifts, hours, etc. • Safety, disaster, and emergency procedures. • Transportation plan, including available transport equipment, vehicle fleet • and reserve capabilities. • Inclement Weather Plan - This shall describe the bidder's plan should inclement weather alter normal daily operations as described in the bidder's operations plan. The inclement weather plan shall include hauling operations and disposal operations. The bidder's means of assessing inclement weather conditions (weather and road conditions), method of reporting to the Town and the alternatives shall be described. 9.1 Supporting Data In the event the Town requires any information in support of Town held licenses and permits at the Town, County, State and Federal level, the Contractor will be required to furnish all licenses, permits and inspection reports regarding equipment and disposal sites which may be required by Town, County, State or Federal law. In the event the Contractor requires any information in support of Contractor held licenses and permits at the Town, County, State and Federal level, the Town will cooperate in furnishing such information as it applies to the Southold Town operations. • 35 • Operating (hauling and disposal) records shall be considered essential to the operation. The Contractor shall keep these data in an organized fashion that allows for easy retrieval and analysis. The Town, or its designee, may upon 24 hours notice inspect the contractor's records. Such records shall he kept, available by Contractor for a period of two (2) years after termination of this Agreement. In the event the Town requires additional information for reporting purposes, the Contractor will supply same. The Town, or its designee, may call upon the Contractor at anytime for an oral review of any technical matter. The Contractor shall file and update the following information as specified herein. Items Due Haul Equipment (Schedule H) as changes occur Haul Accident Report (Appendix C) on occurrence Disposal Accident Reports on occurrence Licenses, Permits and Inspection Reports on occurrence Part 360 Permit as changes occur All Bid Information Schedules as changes occur • • 36 • SECTION C TOWN OF SOUTHOLD CONSTRUCTION MATERIAL AND/OR DEMOLITION DEBRIS SERVICES CONTRACTOR BID FORM 1.0 INTENT The undersigned hereby recognizes that these documents are complementary and are intended to provide for uniformity in bid evaluations. The formal Agreements resulting from this Bid Solicitation shall be in a form provided by the Town. These documents are intended to depict complete Construction and Debris Haul-Disposal Services Agreement and therefore any discrepancies contained in the documents, of the omission from the documents of express reference to any work which obviously was intended under the Agreement, shall not excuse or relieve the Bidder from furnishing the same. No oral statement shall in any • manner or degree modify of otherwise affect the terms of the Agreement. Work or materials described in words which have a well known technical or trade meaning, shall be interpreted by such meaning. 2.0 GENERAL BID STATEMENT TO: TOWN OF SOUTHOLD STATE OF NEW YORK 53095 MAIN ROAD SOUTHOLD, NEW YORK 11971 Gentlemen: The undersigned Bidder has carefully examined the forms and content of the Bid Solicitation, including notice to bidders, bid bond, sample operating agreement, performance bond, certificates of insurance, general conditions, bid specifications, and addenda, has familiarized itself with the sites of work, and hereby proposes to furnish all necessary services, permits, labor, materials, equipment, vehicles, and tools required to perform and complete the work in strict accordance with all of the bid documents written by or on behalf of the Town of Southold for this project. 38 The undersigned Bidder agrees to abide by all conditions stated, intended, or implied both particularly and generally by the terms of this Bid Solicitation, the Agreement to be provided by the Town, and the unit price Bid herein stated. 1. The Undersigned Bidder also agrees as follows: FIRST: If this bid is accepted, to execute the Agreement and furnish to the Town a satisfactory performance bond, and insurance all within ten (10) calendar days. SECOND: To begin Construction and Debris Haul-Disposal services operations on the commencement date of any Agreement awarded hereunder, having completed all necessary prior preparations of operational planning, personnel hiring, equipment procurement, subcontractor contractual agreements, and ancillary facilities, etc., to assure a smooth and orderly acceptance of these duties. THIRD: To pay the Town any and all damages it may incur as a result of the Contractor's failure to perform all acts necessary to the execution of the Agreement as provided in the Bid Solicitation. It is recognized and agreed that the Town has the unconditional right to utilize . the funds provided by the bid bond posted by the Bidder as a means of obtaining indemnification or, payment of such damages. FOURTH: During the performance of this Agreement, the Contractor hereby agrees as follows: a. The Contractor shall not discriminate against any employee or applicant for employment because of age, race, creed, color, sex, marital status, national origin, physical disability, and shall take affirmative action to ensure that they are afforded equal employment opportunities without discrimination because of age, race, creed, color-, sex, marital status, national origin or physical disability. Such action shall be taken with reference, but not be limited to: recruitment, employment, job assignment, promotion, upgrading, demotion, transfer, layoff, or termination, rates of pay, or other forms of compensation, and selection for training or retraining, including apprenticeship and on-the-job training. b. The Contractor shall comply with the provisions of Sections 290 through 301 of the Executive Law, shall furnish all information and reports deemed necessary by the State Commission for Human Rights under these nondiscrimination clauses and such sections of the Executive Law, • and shall permit access to his books, records, and accounts by the State 39 • Commission for Human Rights, the Attorney General, and the Industrial Commissioner for purposes of investigation to ascertain compliance with these nondiscrimination clauses and such sections of the Executive Law and Civil Rights Law. c. This Agreement may be forthwith cancelled, terminated, or suspended, in whole or in part, by the Town upon the basis of a finding made by the State Commission for Human Rights that the Contractor has not complied with these nondiscrimination clauses, and the Contractor may be declared ineligible for future Agreements made by or on behalf of the state or public authority or agency of the state, until he satisfies to the State Commission for Human Rights that he has established and is carrying out a program in conformity with the provisions of these nondiscrimination clauses. Such findings shall be made by the State Commission for Human Rights after conciliation efforts by the Commission have failed to achieve compliance with these nondiscrimination clauses and after verified complaint has been filed with the Commission, notice thereof has been given to the Contractor, and an opportunity has been afforded to him to be heard publicly before three members of the Commission. Such sanctions may be imposed and remedies invoked independently or in addition to sanctions and remedies otherwise provided by law. d. No laborer, workman or mechanic in the employ of the Contractor or subcontractor shall be permitted or required to work more than eight hours in any one calendar day, or more than five days in any one week except as otherwise provided in Labor Code Section 220. e. The Contractor shall include the provisions of clauses (a) through (e) in every subcontract or purchase order in such a manner that such provisions will be binding upon each subcontractor or vendor as to operations to be performed within the State of New York. The Contractor will take such action in enforcing such provisions of such subcontract or purchase order as the Town may direct, including sanctions and remedies. FIFTH: By submission of this bid, the Bidder and each person signing on behalf of any Bidder certifies, and in case of a joint bid each party thereto certifies as to its own organization, under penalty of perjury that to the best of his knowledge and belief: a. The prices in this bid have been arrived at independently without collusion, consultation, communication, or agreement for the purpose of restricting competition, as to any matter relating to such prices with any . other Bidder or with any competitor. 40 b. Unless otherwise required by law, the prices which have been quoted in this bidhave not been knowingly disclosed by the Bidder and will not knowingly be disclosed by the Bidder prior to opening, directly or indirectly to any other Bidder or to any competitor. c. No attempt has been made nor will be made by the Bidder to induce any other person, partnership, or corporation to submit or not to submit a bid for the purpose of restricting competition. 2. The undersigned also declares that it has or they have carefully examined the Bid Solicitation requirements and sample operating agreement and that it has or they have personally inspected the actual location of work, together with the local sources of supply, has or have satisfied itself or themselves as to all the quantities and conditions, and waives all rights to claim any misunderstanding, omissions or errors regarding the same which such inspection and observation would have disclosed. The undersigned further understands and agrees that it is or they are to furnish and provide in return for the respective Evaluation Unit Bid Price, all the necessary materials, machinery, vehicles, implements, tools, labor services, and other items of whatever nature, and to do and perform all work necessary . under the aforesaid conditions, to complete operations of the aforementioned Construction and Debris Haul-Disposal Services operations in accordance with the Bid Solicitation requirements, which requirements are a part of this response, and that it or they will accept in full compensation therefore, the compensation provided for in Section C-3. 3. The undersigned submits herewith a bid guaranty within the form provided by the applicable bid documents in the amount of $100,000.00 for any option or combination thereof. In the event this proposal is accepted, and the undersigned fails, within ten (10) calendar days after date of receipt of Notice Of Award from the Town to execute and deliver an Agreement in the form provided by the Town or fails to execute and deliver evidence of proper insurance coverage and performance bond in the amounts required and in the prescribed form within ten (10) days after Notice of Award, the bid guaranty shall be forfeited and be retained by the Town toward the satisfaction of liquidated damages and not as a penalty. Otherwise, the total amount of bid guaranty liquidated will be returned to the Bidder. 4. The undersigned acknowledges the receipt of the following addenda, but it agrees that it is bound by all addenda whether or not listed herein and whether or not actually received, it being the Bidder's responsibility to receive and have • knowledge of all addenda. 41 ADDENDUM NUMBER AND DATES Number 1 - Dated: May 1, 1997 Number 2 - Dated: Number 3 - Dated: Number 4 - Dated: Number 5 - Dated: 5. The Bidder has completed the Contract Bid Form and Unit Price Schedules in both words and numerals in accordance with these bid requirements. 3.0 UNIT PRICE BID SCHEDULE CONSTRUCTION AND DEBRIS HAUL-DISPOSAL SERVICES SOUTHOLD TOWN, NEW YORK 3.1 COMPENSATION The undersigned hereby submits the following price bid to furnish • Construction and Debris Haul-Disposal Services, to Southold Town, New York for the terms July 10, 1997 through July 9, 2002. HAUL-DISPOSAL SERVICES The Haul-Disposal Service applicable unit price per ton for agreement year 1997-1998 is dollars and nts ($ ,�1G. ). (Cl) he Haul-Disposal Service applicable unit price per ton for agreement year 1998-1999 is / dollars and (C2) • 42 • The Haul-Dispoervice applicable unit price per ton for agreement sal year 1999-2000 is dollars and ents ($ U .� ) (C3) The Haul-Disposal Se cel a`p/ licable unit price per ton for agreement year 2000-2001 is ''�` dollars and lumk cents ($ C�� . ). (C4) The Haul-Disposal Service applicable unit price per ton for agreement year 2001-2002 is dollars and cents ($ ). (C5) 3.2 VALUATION UNIT BID PRICE FORMULA Evaluation Unit Bid Price = . (CI)5,000+(C2)5,000+(C3)5,000+.5(C4)5.000+ 5(C5)5,000 20,00(0`tons Evaluation Unit Bid Price = $--L ` J The evaluation unit bid price formula is designed to evaluate years four and five at .5 the evaluate of each of the first three (3) years. wM of New York, uInc. DBA 123 Varick Avenue Bidder: waste Manaaanent of New Vnrk Brooklyn NY 11737 Firm-Corporation Address By: --- May 22, 1997 Authorized Representative Date • 43 Q�OgUFfO(,�-c JUDITH T.TERRY =� OG'y� Town Hall, 53095 Main Road • TOWN CLERK y P.O. Box 1179 x Southold, New York 11971 REGISTRAR OF VITAL STATISTICSO Fax(516) 765-1823 MARRIAGE OFFICER RECORDS MANAGEMENT OFFICER yifl� �aQ�� Telephone(516) 765-1800 FREEDOM OF INFORMATION OFFICER OFFICE OF THE TOWN CLERK TOWN OF SOUTHOLD May 1 , 1997 Dear Bidder: Please replace Page 43 in your bid packet for Construction E Demolition (CED) Haul Disposal Services with the enclosed Page 43. Thank you. Town of Southold • • 4.0 BID SECURITY ACKNOWLEDGMENT I have attached the required bid security to this bid. 5.0 INFORMATION SCHEDULES I agree to furnish and include the following information schedules in addition to the information submitted with this proposal, as a part of this bid: A. Certification that the Bidder does not currently owe taxes, or other outstanding funds, or have pending or is currently involved in any litigation involving the Town of Southold, State of New York (Schedule A, attached hereto). B. Location and address of the Bidder's main office and the main office of parent companies (if applicable) and Certified Statements of Ownership (Schedule B, attached hereto). C. Identification of Surety Company and its Agent, and written certification from the Surety verifying the bond specified herein will be provided (Schedule C, attached hereto). • D. Identification of all currently registered parent bidding subsidiary corporate officers, and their addresses, and identification and certification of offices authorized to execute an Agreement on behalf of the firm (Schedule D, attached hereto). E. Detailed financial statement for the Bidder, and if applicable, for parent companies (Schedule E, attached hereto). F. Statement of Bidder's Qualifications and related experiences (Schedule F, attached hereto). G. Major Subcontractors - (Schedule G, attached hereto). H. Equipment - (Schedule H, attached hereto). I. Maximum Specified Capacity - (Schedule I, attached hereto). J. Information on Bidder's Construction and debris Disposal Site(s) (Schedule J, attached hereto). K. Form of Bid Bond (Schedule K, attached hereto). 44 L. Performance Bond (Schedule L, attached hereto). • M. Operation Plan (Schedule M, attached hereto). Dated: May 22, 1997 WM of New York, Inc. DBA Name of Bidder: waste Management of New York Address of Bidder: 123yarick Avenue Brooklyn New York 11237 ignature Title Corporate Seal (If a Corporation) • Incorporated under the laws of the State of ner aware Names and addresses of officers of the corporation: William P. Hulliaan 8434 Ca*riaae c r;en rr (President) Name Address Thomas J. Jennings 70 Johnnycake strep+ N Ana em (Secretary) Name Address Robert C. Bigg 210 Kathy Way Yaidely. PA (Treasurer) Name Address (If an individual or partnership) Names and addresses of all principals or partners • ?NFORMATiON SCHEDULE A Town cr Southold Bid Protect CED Haul - Disposal Services W+I of Nw York, Inc. Imo, This Bidder WasteMmagnat of New York herein certiries that as a (Bidder ' s legai name) Bidder , it does not currently owe delinquent taxes or ocher, OUt5taOding CUneS, Or having pending or currenti1, involved in any litlgatiOn ;nvc'vin( she Town of Southold , State cF New York . W-I of Nw York, Inc. IM Name o` Bi_der:lLb l ftlaars* Cate: 5/22/97 .Awed c; ,a:.:re. • NOTE: (1) i.` blank net applicable , fill in with N/A ('c) _r bidder owes the Town taxes or is involved in any _iLigation, a statement o.` ex=ianaticn will be attached hereto . • Tax/'__ti;aLion TertiF:cat'-cn Sc^edule 5 .O . A TNFORMAT,ON SCH°RULE B Town of Southold Bid Project CED Haul - Disposal Services The following is information on the undersigned Bidder ' s office loca=ions: Bidder 's Parent Bidder ' s Main OFFice Corporation Main Office 123 Varick Brooklyn, NY WMX Technologies, Inc. _Charles Gusmano _ William Hulligan Manager 's Name icontac:) Manager 's Name (Contac) Wase Managemefitl0 New Cork WMX Technologies Inc. . . . ' s Leca'_ Name Farent F_rm ' s Legal Nam=_ 123 Varick Avenue 3003 Butterfeild Road Scree. Addr =_s .3cx N ,giber=_) Greet Accress CEox Numzers— • Brooklyn, NY 11237 Oakbrook IL 60521 Ci- Sta e Z_p City State Z p 718-533-5314 630-572-8800 Telec:-one `umber Telephone Number WYI of NEW Slack, Inc. The =idler herein cerci Fies that the Wase 4 of NewYc k Firm is partially/wholly owned subsidiary of *K TaunIgies Inc. Parent Firm Th; s WA is owned N/A Parent Firm Sy Dim or, -: sa publi'/private stock corporation . 54Ar CFC4 '- T 'Ca.._�" 5/Ownership DCnegU1 7 .0 .3 Ce r_ificatln rage l of 2 WM of New York, Inc. DBA Name of 5idder : Waste Management of New York ���{{�.{ Date: 5-22-97 S� L--/— arles Gusmano • Note : � '_ '� ^ny a��aohme^�5 O� mod'-= =Ca�-.."5 �.. �h_5 :ofm shall _abeled Schedule -S .C . ' , and be ;, o-�ertg _ntegrazed _nzo zhe Bid Form . .2? tlank not applicable, `111 _47 with N/A • Bidder OFF' Se ? ^CB,i-_n., :_runc—hiL) tinhgd,;_= _ . _ . - Fage = -` C BID C?RJrCSAL) FDRM -own cf Scuticld aid -rr ?e_= C&D Haul-Disposal Services loaton that Firgmn`s Fund Insurance Company 'e the Surety Camoany cr WM of New York, Inc. =he _:deer, cn =his projac= and that the named Surety ..cmca-W he_e! p:cvite$ wr=_ten =arts?icat:cn t:ja= the ;.arced =car- Ca.^=a-5 w:,_ trov_:e :he ?er?oraar.:a Send, s=ec-"__M =^e �c:.:.e-r=g. =• =ie avert t`= =l==sr. enters _nt= an AS^sore.. . vim . the =wn . -i.e G - care .•t„ =`ac �uC., _orpahy _5 __=erred _= ti8 do l Hess - =i'a State New . W OF NEW Y RK,f INC. Donald 'S.'1 auieal Assistant Secretary FIREMAN'S FUND INSURANCE COMPANY c —ety �_mFa-s ay: Me ssa M. man Attorney-in-Fact a' GENERA: POWER OF ATTORNEY FIREMAN'S FUND INSURANCE COMPANY , KNOW ALL MEN BY THESE PRESENTS:That FIREMAN'S FUND INSURANCE COMPANY,a Corporation duly organized and existing under the laws of i the State of California,and having its principal office in the County of Marin,State of California,has made,constituted and appointed,and does by these presents make,constitute and appoint DONALD S . HAUFE , KAREN E . BOGARD , REBECCA R. ALVES , LINDA M. MAKDAH, MELISSA M. NEWMAN, jointly or severally CHICAGO IL its true and lawful Attomey(s)-in-Fact,with full power and authority hereby conferred in its name,place and stead,to execute,seal,acknowledge and deliver any and all bonds,undertaking,recognizances or other written obligations in the nature thereof _______________________________ and to bind the Corporation thereby as fully and to the same extent as if such bonds were signed by the President, sealed with the cc.porate seal of the Corporation and duly attested by its Secretary,hereby ratifying and confirming all that the said Attomey(s)-in-Fact may do in the premises. This power of attorney is granted pursuant to Article VII,Sections 45 and 46 of By-laws of FIREMAN'S FUND INSURANCE COMPANY now in full force and effect. "Article VH.Appointment and Authority of Resident Secretaries,Attorney-la-Fact and Agents to accept Legal Process and Make Appearances. Section 45.Appointment.The Chairman of the Board of Directors, the President,any Vice-President or any other person authorized by the Board of Directors,the Chairman of the Board of Directors,the President or any Vice-President may,from time to time,appoint Resident Assistant Secretaries and Attorneys-in-Fact to represent and act for and on behalf of the Corporation and Agents to tecept legal process and make appearances for and on behalf of the Corporation. Section 46.Authority.The authority of such Resident Assistant Secretaries,Altomeys4o-Fact and Agents shall be as prescribed in the instrument evidencing their appointment.Any such appointment and W authority grained thereby may be revoked at any time by the Board of Directors or by any person empowered to make such appointment:' This power of attorney is signed and sealed under and by the authority of the following Resolution adopted by the Board of Directors of FIREMAN'S FUND INSURANCE COMPANY at a meeting duly called and held on the 7th day of August,1994,and said Resolution has not beta amended or repealed: "RESOLVED, that the signature of any Vice-President, Assistant Secretary, and Resident Assistant Secretary of this Corporation, and the seal of this Corporation maybe affixed or printed on any power of attorney,on any revocation of any power of attornev.or on any certificate relatim th—tom and my,v,. . STATE OF II�L�LQ1g COUNTY OF DUPAGE On this�2us1 day IMaw — 1997, before me Personally appeared ct o� known to me to be Attomey that Melissa the corporation Fireman's Fun In executed executed the within instrument, and acknowledged to me than such corporation the same. nto set my hand and atfbted by official seal, at my IN WITNESS WHEREOF; I have hereu office in the aforesaid county, the day and year in this certificate first above written. Jam. � r4A FFICIl�L. S AL"TTY JKENISTAPYUp1C CF ILLINOIS Coy h;rri es ';'/17/99 CERTIFICATE STATE OF CALIFORNIA 1 /Ij sec. COUNTY OF MARIN I,the undersigned,Resident Assistant Secretary of FIREMAN'S FUND INSURANCE COMPANY,a CALIFORNIA Corporation,DO HEREBY CERTIFY that the foregoing and attached POWER OF ATTORNEY remains in full force and has not been revoked;and furthermore that Article VII,Sections 45 and 46 of the By-laws of the Corporation,and the Resolution of the Board of Directors;set forth in the Power of Attorney,are now in force. Signed and sealed at the County of Marin.Dated the 22nd day of MaV 19 97 III RaWeo,,WismtSeaeaty 360713—FF-1127 GENERA', POWER OF ATTORNEY FIREMAN'S FUND INSURANCE COMPANY KNOW ALL MEN BY THESE PRESENTS:That FIREMAN'S FUND INSURANCE COMPANY,a Corporation duly organized and existing under the laws of the State of California,and having its principal office in the County of Marin,State of California,has made,constituted and appointed,and does by these presents make,constitute and appoint DONALD S . HAUFE, KAREN E. BOGARD, REBECCA R. ALVES , LINDA M. MAKDAH, MELISSA M. NEWMAN, jointly or severally CHICAGO IL its true and lawful Attomey(s)-in-Fact,with full power and authority hereby conferred in its name,place and stead,to execute,seal,acknowledge and deliver any and all bonds,undertaking,recognizauces or other written obligations in the nature thereof _______________________________ and to bind the Corporation thereby as fully and to the same extent as if such bonds were signed by the President, sealed with the corporate seal of the Corporation and duly attested by its Secretary,hereby ratifying and confirming all that the said Attomey(s)-in-Fact may do in the premises. This power of attorney is granted pursuant to Article VII,Sections 45 and 46 of By-laws of FIREMAN'S FUND INSURANCE COMPANY now in full force and effect. "Article VH.Appointment and Authority of Resident Secretaries,Attorney-in-Fact and Agents to accept Legal Process gad Make Appearances. Section 45.Appointment.The Chairman of the Board of Directors,the President,any Vice-President or any other person authorized by the Board of Directors,the Chairman of the Board of Directors,the President or any Vice-President may,from time to time,appoint Resident Assistant Secretaries and Attorneys-la-Fad to represent and act for and on behalf of the Corporation and Agents to accept legal process and make appearances for and on behalf of the Corporation. Section 46.Authority.The authority of such Resident Assistant Secretaries,Attomeys-in-Fact and Agents shall be as prescribed in the instrument evidencing their appointment.Any web appointment and all authority granted thereby may be revoked at any time by the Board of Directors or by any person empowered to make such appointment.^ This power of attorney is signed and sealed under and by the authority of the following Resolution adopted by the Board of Directors of FIREMAN'S FUND INSURANCE COMPANY at a meeting duly called and held on the 7th day of August, 1984,and said Resolution has not been amended or repealed: "RESOLVED, that the signature of any Vice-President, Assistant Secretary, and Resident Assistant Secretary of this Corporation, and the seal of this Corporation may be affixed or printed on any power of attorney,on any revocation of any power of attorney,or on any certificate relating thereto,by facsimile, and any power of attorney,any revocation of any power of attorney,or certificate bearing such facsimile signature or facsimile seal shall be valid and binding upon the Corporation!' IN WITNESS WHEREOF,FIREMAN'S FUND INSURANCE COMPANY has caused these presents to be signed by its Vice-President,and its corporate seal to be hereunto affixed this 11 t It day of March _, 1996 Nap e .:�.:.;4°io FIRE D 1 'O1 E COMPANY 2+ cid` By A'CLCO V1CL—PRLJNI STATE OF CALIFORNIA COUNTY OF MARIN m Onthis llth day of March 19 96 before me personally came M. A. Mallonee to me known,who,being by me duly sworn,did depose and say:that he is Vice-President of FIREMAN'S FUND INSURANCE COMPANY,the Corporation described in and which executed the above instrument;that he knows the seal of said Corporation;that the seal affixed to the said instrument is such corporate seal;that it was so affixed by order of the Board of Directors of said Corporation and that he signed his name thereto by tike order. IN WITNESS WHEREOF,I have hereunto set my hand and affixed my official seal,the day and year herein first above written. A. KRIEGER D conln+.z+0asrtz 3yC.-a_tf CRNu O N tut Pubic V CJYiY f 'ter ��• ",! ,,i.. �, E v sr.;a, �o,1gun J CERTIFICATE STATE OF CALIFORNIA sa. COUNTY OF MARIN 1,the undersigned,Resident Assistant Secretary of FIREMAN'S FUND INSURANCE COMPANY,a CALIFORNIA Corporation,DO HEREBY CERTIFY that the foregoing and attached POWER OF ATTORNEY remains in full force and has not been revoked;and furthermore that Article VII,Sections 45 and 46 of the By-laws of the Corporation,and the Resolution of the Board of Directors;set forth in the Power of Attorney,are now in force. Signed and sealed at the County of Marin.Dated the 22nd day of May 19 97 ResiAeot Asusimt Senetaty 360712—FF-11-87 iNFpRMirTTDN SCHEDULE r Town of Southold Bid Project CSD Haul - Disposal Services The Bidder herein certifies that the below named individuals are the current registered corporate officers, along with their current permanent addresses , and designates their authority to execute an Agreement on behalf of the firm SEE ATTACHED Officer ' s Name Officer ' s Name Subsidiary Parent Corporate Corporate Title Address Address • City City State, Zip State , Zip Officer ' s Name OFFicer ' s Name Subsidiary Parent Corporate Title Corporate Title Address Address City City State, Zip State, Zip Officer 's Name Officer ' s Name Subsidiary Parent Corporate Title Corporate Title Address Address City City State , Zip State, Zip • Current Corporate Officers Schedule S .O . 'u BID CPROPCSAT-) PORI 'age ]. Cf INFORMATION SCHEDULE 0 - (Continued) See Attached Officer 's Name Officer 's Name Subsidiary Parent Corporate Title Corporate Title Address Address City City State , Zip State, Zip Wd Cf Naw York, Inc. EER Name/off Bidder : �W36teMawnstefNew York Seal Date: M' 71.1997 • NOTE : = blank not applicable, `ill in with N/A • OFficer Schedule _ .,, .D E_I CPRC=CSAL. F--=M C ;L OFFICERFS OF WMX TECHNOLOGIES, INC. Buntrock, Dean L. 3003 Butterfield Road Chairman of The Board & Cheif Executive Office Oakbrook IL 60521 Rooney, Philip B. (Phil) 3003 Butterfield Road President & Cheif Operating Officer Oakbrook IL 60521 Gertz, Rodney C. 3003 Butterfield Road Vice President-Technology Development & Management Oakbrook IL 60521 Hau, Thomas C. (Tom) 3003 Butterfield Road Vice President & Controller Oakbrook IL 60521 Hooks, H Vaughn 3003 Butterfield Road Vice President & Tax Oakbrook IL 60521 Jericho, Ronald M. (Ron) 3003 Butterfield Road Vice President-Reporting Oakbrook IL 60521 Payne, D.P. (Pat) 3003 Butterfield Road Senior Vice President - Human Resources & Communications Oakbrook IL 60521 Moore, Frank B. 3003 Butterfield Road Vice President-Government Affairs Oakbrook IL 60521 Koenig, James E. (Jim) 3003 Butterfield Road Vice President, Cheif Financial Officer & Treasurer Oakbrook IL 60521 Nustra, Susan C. (Sue) 3003 Butterfield Road Vice President-Treasury Oakbrook IL 60521 Plunkett, William J. (Bill) 3003 Butterfield Road Vice President-Communications Oakbrook IL 60521 Tobecksen, Bruce D. 3003 Butterfield Road Vice President-Finance Oakbrook IL 60521 Wallgren, Donald A. (Don) 3003 Butterfield Road Vice President-Cheif Environmental Officer Oakbrook IL 60521 Witt, Thomas a, (Tom) 3003 Butterfield Road Vice President & Associate General Counsel Oakbrook IL 60521 Wittd, Linda R. (Lin) 3003 Butterfield Road Vice President & Associate Generale Counsel Oakbrook IL 60521 Page 1 CONTRACTOR AFFIRMATION STATMENT WM OF NEW YORK, INC. NAME PRESIDENT AND DIRECTOR ADDRESS WILLIAM P. HULLIGAN PRESIDENT AND DIRECTOR 8434 CARRIGE GREEN DR. DARIAN, IL 60561 JAMES M. DANCY VICE PRESIDENT 156 CLIVEDEN DRIVE NEWTOWN, PA 18940 ROBERT C. BIGGS VICE PRESIDENT,TREASURER 1198 WATERWHEEL DR. YARDLEY PA 19067 THOMAS J. JENNINGS VICE PRESIDENT,SECRETARY 1030 FARMAL COURT AND DIRECTOR YARDELY, PA 19067 JEFFREY C. EVERETT ASSISTANT SECRETARY 400 S. ASHLAND AVENUE LA GRANGE IL 60525 DONALD S. HAUFE ASSISTANT SECRETARY 5546 BRUNER STREET HINSDALE, IL 60521 . H. VAUGH HOOKS ASSISTANT TREASURER 6327 WESLEY STREET WILLOWBROOK, IL 60521 SUSAN C. NUSTRA ASSISTANT TREASURER 19 W. 221 PATRICK HENRY SQ. OAKBROOK, IL 60521 L. MICHAEL COLLIER DIRECTOR 5 LAKEVEIW DRIVE NEWTOWN , PA 18940 WMDIREC - See Attached Financial Information • TNFORMATION SCHEDULE E Town of Southold Bid Project C&D Haul - Disposal Services STATEMENT OF BIDDER 'S FINANCIAL CONDITION 1 . This Bidder agrees to provide For any subsidiary and parent Firm, and hereto attaches a current or the most recent Audited Financial StatementCs) including as a minimum the Firms opinions, notes, revenue/expense statements, conditions of cash, etc . The attached statement provided includes: Accounting Firm Name Address Financial Period To Statement Date • F . The bidder certiFies that he currently has an avail=_tie fine of credit in the amount of 5 A supporting documentary evidence attached to this FOrm is supplied bu : Name Address Date 3 . The undersigned Bidder certifies to the validity of statement and agrees to Furnish any other informaticn ucon request that may be required by the Town OF Southold, New York . • Bidder ' sFinancial Ccndition Schedule S .C . - B70 (PRCPOSAL) FORM Page 1 of c INfORt'IA-ION SCHEDULE E - (continued) i . The undersigned hereby authorizes and requests any person , firm or corporation tc .*Furnish any information requested by Town of Southold, New York in verification of the Firms Financia'_ condition. Dated at 5-22-97 This 22 day of May lama W['tf NV Tm_ e of Bidder Qmjm Qsrani rd�, a3=]EE 3 UEW3 prsrt . State of New York, County or Kings being duly sworn deposes and says that he iS nhatr, Hsuraa Degelg3rsrt of WM of NY Inc. '_ole Name of Organization and Lha: the answers to Lhe Foregoing questions and all sLaLemen_ `herein contained are true and correct . • Sworn tc^me L.,is 22day f May 195 . 71HOMAS M.LAMBERT Nolory Publk,Swr.of Now York No.41-4950140 dWMW in Nouou Coolly No r b l i c CGMMWM EXpirwJuly9,199 Mg Commission expires NOTE : Cl) (Bidder may submit additional information iF desired as Schedule E attachments . ) (2) IF blank not applicable, Fill in with N/A • cidder ' s 'ina7cial _cnd_,_� 5iO (PRO?DSAL) ?ORf^ Page 2 CREDIT AND FINANCIAL INFORMATION WMX Technologies, Inc. (formerly WASTE MANAGEMENT, INC,) 3003 Butterfield Road Oak Brook, Illinois 60521 Parent Company of WMX Technologies, Inc. provides comprehensive waste management services to industrial and commercial customers in North America through its Waste Management, Chemical Waste Management and Wheelabrator Technologies units. The Company's services include collecting, processing and disposing of solid waste and also transporting, treating, recovering and disposing of chemical and radioactive wastes. Environmental services are also offered abroad through subsidiaries. FINANCIAL SUMMARY 1994 1995 Total Revenue $9,554,705,000 $10,247,617,000 Net Income $784,381,000 $603,899,000 Total Assets $17,423,173,000 $18,695,308,000 Cash and Short-Term Investments $143,052,000 $225,274,000 Stockholders Equity $4,540,981,000 $4,942,339,000 • COMMON STOCK Listed on the New York Stock Exchange since 1971. Also listed on Chicago, Frankfurt, London, and Swiss Exchanges. Shares Outstanding (12/31/95).......................................................................................487,047,305 Total Market Capitalization(12/31/95) ..................................................................... $14,489,657,324 AVAILABLE COMMITTED CREDIT LINES (As of December 31, 1996) FirstUnion National Bank ...........................................................................................$25,000,000 MellonBank............................................................................................................$25,000,000 NationsBank............................................................................................................$25,000,000 WachoviaBank ........................................................................................................$25,000,000 Other Banks .......................................................................................................... $800,000,000 CREDIT RATINGS Moody's Standard &Poor's Long-Term Debt Al A Commercial Paper P1 Al DUN& BRADSTREET RATING Dun& Bradstreet Rating Dons Number 5A2 047577416 f:\wmz\credfin.doc 2/21/97 6:35 PM • 1 • SECURMES AND EXCHANGE COMMISSION Washington, D.C. :0549 FORM 10-Q (MARK ONE) X QUARTERLY REPORT PURSUANT TO SECTION 13 or ISM OF THE SECURITIES EXCHANGE ACT OF 1434 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 19% TRANSITION REPORT PURSUANTTO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO Commission file number 1.7327 WMX TECHNOLOGIES, INC. (Fact name of Registrant as specified in its chatter) • Delaware 362660763 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 300.3 Butterfield Road, Oak Brook, Illinois 60521 (Address of principal executive offi¢) (Zip Code) Registrant's telephone number, including arta code: (630) 572-8800 filed by Section 13 or 1 5; Indicate by check mark whether the Registrant (1) has filed all reports required to be d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No _ Shares of Registrant's Common Stock. $1 par value, issued and outstanding at July 31, 19% - 491,0 3 PART I, FINANCIAL INFORMATION • „ WMX TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) ($000's omitted) ASSETS December_Z1,_1291 ,lune 30. , , CURRENT ASSETS: Cash and cash equivalents $ 189,031 Short-term investments 36,243 $ 266,43° Accounts receivable, 1866 reserve of $66,840 in 1995 25,87 and $60,563 in 1996 1,880,934 Employee receivables 1,937,39 Parts and supplies 8,787 10,21 Costa and estimated earnings in excess of billings 210,864 204,55 on uncompleted contracts 334,786 Prepaid expenses 368,16 360,404 376.4c Total Current Assets S 3,021.O4 - la.189. 12 PROPERTY AND EQUIPMENT, at cost: Land, primarily disposal sites $ 4,575,117 • Buildings 4,572,821 $ 4,816,18 Vehicles and equipment 1,542,10 Leasehold improvements 7,498,718 7,795,26 87.986 91. 1C $13,734,642 $14,244,71 Less - Accumulated depreciation and amortization /3.968.94j) (4,315.80 Total Property and Equipment, Net S 9,765,699 S 9.928.9 OTHER ASSETS: Intangible assets relating to acquired businesses, net $ 4,205,031 , Sundry, including other investments 1,572 577 $ 4,566, .� _ Net assets of discontinued operations 130, 552 i'619 ,63 Total Other Assets 1-11=81-5-69 5 6. 185 EC Total Assets 518,695.308 519,303.E3 The accompanying notes are an integral part of these balance sheets. • 3 • NMX TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME FOR THE THREE MONTHS AND SIX MONTHS ENDED JUNE 30 • �' (Unaudited) (000's omitted except per share amounts) Three Months Six Months Ended June 30 Ended June 30 1995 1996 1995 1996 REVENUE 82.635,665 52,618.12555.080.850 55.035.316 Operating expenses $1,817,192 $1,815,274 $3,501,142 $3,495,197 Special charges - - 140,600 - Goodwill amortization 29, 544 32,806 59,054 64,370 Selling and administrative expenses 300,322 289,268 587,852 576,154 Interest expense 111,847 99,603 218,370 198,918 Interest income (14,463) (6,857) (23, 349) (13,699) Minority interest 40, 117 32,179 69,431 60,254 Sundry income, net (13 .343) (21,409) !30.264) (38.768) • Income from continuing operations before income taxes $ 364,449 $ 377,261 $ 558,014 $ 692,890 Provision for income taxes 151.987 154.219 244.260 284.670 Income from continuing operations $ 212,462 $ 223,042 $ 313,754 $ 408,220 Income from operations of discontinued businesses, less applicable income taxes and minority interest of $6,382 and $6,474 for the three months and six months ended June 30, 1995, respectively 6. 665 - 6. 618 NET INCOME S 219 . 127 S 223.042 S 320, 372 $ 408.220 AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING 485 ,082 496,031 484. 968 492,593 EARNINGS PER COMMON AND COMMON EQUIVALENT SHARE Continuing operations $ 0.44 $ 0.45 $ 0.65 S 0.83 Discontinued operations 0.01 - 0.01 NET INCOME S 0.45 $ 0.45 $ 0.66 $ 0.83 DIVIDENDS DECLARED PER SHARE 5 0.15 $ 0. 16 S 0.30 $ 0.31 • The accompanying notes are an integral part of these statements. 5 WMX TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY FOR THE SIX MONTHS ENDED JUNE 30, 1996 (Unaudited) ($000's omitted except per share amounts) 1988 Employee Additional Cumulative Stock Employee Common Paid-In Translation Retained Treasury Ownership Stock Stock Capital Adjustment Earninas Stock Plan Benefit Trust Balance, January 1, 1996 $498,817 $422,801 $(102,943) $4,486,877 $ - $13,062 $350,151 Net income for the period - - - 408,220 - - - Cash dividends ($.31 per share) - - - (153,222) - - - Dividends paid to Employee Stock Benefit Trust - 3,460 - (3,460) - - - Stock repurchase (5,000,000 shares) - - - - 168,305 - - Stock issued upon exercise of stock options 217 (7,332) (25,617) - (28,622) Treasury stock received in connection with exercise of stock options - - - - 791 - - Tax benefit of non-qualified stock options exercised - 4,999 - - - - - Contribution to 1988 Employee Stock Ownership Plan - - - - - (3,333) - Treasury stock received as settlement for claims - - - - 2,400 - - Common stock issued upon conversion of Liquid Yield Option Notes 107 1,893 - - - - - Common stock issued for acquisitions 7,957 226,222 - - - - - Temporary equity related to put options - (135,957) - - - - - Proceeds from sale of put options - 14,774 - - - - - Adjustment of Employee Stock Benefit Trust to market value - 34,999 - - - - 34,999 Cumulative translation adjust- ment of foreign currency statements - - 15,587) - - - - Balance, June 30, 1996 5507,098 $565,859 $(108,530) $4,738,415 $145,879 S 9,729 S356,528 The accompanying notes are an integral part of this statement. WMX TECHNOLOGIES, INC. AND SUBSIDIARIES • NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) ($000's omitted in all tables) The financial statements included herein have been prepared by WMX Technologies, Inc. ("WMX" or the "Company") without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The financial information included herein reflects, in the opinion of the Company, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position and results of operations for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, income and expenses and disclosures of contingencies. Future events could alter such estimates in the near term. Certain amounts in previously issued financial statements have been restated to conform to 1996 classifications. • Income Taxes - The following table sets forth the provision for income taxes for continuing operations for the three months and six months ended June 30, 1995 and 1996: Three Months Six Months Ended June 30 Ended June 30 1995 1996 1995 1996 Currently payable $ 69,859 $102,940 $129,880 $168,333 Deferred 82,399 51,473 114,922 116,725 Amortization of deferred investment credit (271) (194) (542) (388 $151,987 $154,219 244. 260 $284,670 Business Combinations - During 1995, the Company and its principal subsidiaries acquired 136 businesses for $224,304,000 in cash (net of cash acquired) and notes, $77,689,000 of debt assumed, and 2,236,354 shares mm of the Company's coon stock. Three Of the aforementioned 1995 acquisitions, which otherwise met pooling of interests criteria, were not significant in the aggregate and, consequently, prior period financial statements were not restated. The remaining acquisitions were accounted for as purchases. in January 1995, the Company acquired all of the approximately 21.4% of the outstanding shares of Chemical Waste Managment, Inc. ("CWM") that it did not already own, for $436.8 million of convertible subordinated notes. In July 1995, the Company acquired all of the approximately 3. 1 million shares of Rust International Inc. ( "Rust" ) held by the public, for $16.35 per share in cash. • 9 Currency Agreements From time to time, the Company and certain of ,ts • subsidiaries use foreign currency derivatives to mitigate the impact of ,translation on foreign earnings and income from foreign investees. Typically these have taken the form of purchased put options or offsetting put and call options with different strike prices. The Company receives or pays, based on the notional amount of the option, the difference between the average exchange rate of the hedged currency against the base currency and the average (strike price) contained in the option. Complex instruments involving multipliers or leverage are not used. Although the purpose for using such derivatives is to mitigate currency risk, they do not qualify for hedge accounting under generally accepted accounting principles and accordingly, must be adjusted to market value at the and of each accounting period. Commodity Agreements The Company utilizes collars, calls and swaps to mitigate the risk of price fluctuations on the fuel used by its vehicles. quantities hedged equate to committed fuel purchases or anticipated usage and accordingly, gains and losses are deferred and recognized as fuel is purchased. The Company is exposed to credit lose in the event of non-performance by counterparties on interest rate, currency and commodity derivatives, but in all cases such counterparties are highly rated financial institutions and the Company does not anticipate non-performance. Maximum credit exposure is represented by the fair value of contracts with a positive fair value at June 30, 1996, which is not material. Environmental Liabilities - The majority of the businesses in which the Company is engaged are intrinsically connected with the protection of the environment. As such, a significant portion of the Company's operating costs and capital expenditures could be characterized as costs of environmental protection. while the Company is faced, in the normal • course business, with the reed to expend funds for environmental protection it does not ex and remediation, pect such expenditures to have a material adverse effect on its financial condition or results of operations because its business is based upon compliance with environmental laws and regulations and its services are priced accordingly. Such costs may increase in the future as a result of legislation or regulation, however, the Company believes that in general it benefits from increased government regulation, which increases the demand for its services, and that it has the resources and experience to manage environmental risk. As part of its ongoing operations, the Company provides for estimated closure and Post-closure monitoring costs over the operating life of disposal sites as airspace is consumed. The company has also established procedures to evaluate Its potential remedial liabilities at closed sites which it owns or operated, or to which it transported waste, including 107 sites listed on the Superfund National Priority List ("NPL") . The majority of the situations involving NPL sites relate to allegations that subsidiaries of the Company (or their predecessors) transported waste to the facilities in question, often prior to the acquisition of such subsidiaries by the Company. where the Company concludes that it is probable that a liability has been incurred, provision is made in the financial statements. Estimates of the extent of the Company's degree of responsibility for remediation of a particular site and the method and ultimate cost of remediation require a number of assumptions and are inherently difficult, and the ultimate outcome may differ from current estimates. However, the Company believes that its extensive experience in the environmental services business, as well as its involvement with a large number of sites, provides a reasonable basis for estimating its aggregate liability. As additional information becomes available, estimates are adjusted as necessary. while the Company does not anticipate that any such adjustment would be caterial to its financial statements, it is reasonably • possible technological, regulatory enforcement emsresults environmntalstudiesor otorscouldnaessitattherecordingof additional liabilities which could be material. 11 ' WTI'g Gloucester County, New Jersey, trash-to-energy facility relies on a disposal franchise for substantially all of its supply of municipal.solid waste. The Federal District Court stayed its injunction for as long as its rzling is on appeal, plus an additional period of two years, to enable the State to devise an • alternative nondiscriminatory approach. The Company believes that the State is considering an appeal of the District Court decision. To date, court decisions with regard to flow control have not had a material adverse effect on the Company' s operations. However, given the surrounding uncertainty, it is not possible to predict what impact, if any, this matter may have in the future on the Company's disposal facilities, particularly WTI's trash-to-energy facilities. In the ordinary course of conducting its business, the Company becomes involved in lawsuits, administrative proceedings and governmental investigations, including antitrust and environmental matters. Some of these proceedings may result in fine, penalties or judgments being assessed against the Company which, from time to time, may have an impact on earnings for a particular quarter or year. The Company does not believe that these proceedings, individually or in the aggregate, will have a material adverse effect on its results of operations or financial condition. Debt - In May 1996, the Company issued $200,000,000 of 6.7% Notes due May a price of 99.828%. In June 1996, the Company 1, 2001, at issued $200,000,000 of 7 1/8% Notes due June 15, 2001, at a price of 99.875%. Neither of these issues is redeemable prior to maturity. In July 1996, the Company issued $450,000,000 of 7.1% Notes due August 1, 2026, at a price of 99.945%. These rotes are not callable and include a put option on August 1, 2003. Legal Matters - • See Part II of this Form l0-Q for a discussion of legal matters. • 13 Waste Clean Clean Consoli- • Services Enerav Water Consult'_na Eliminations dated Six Months Ended June 30 1996 _ Revenue $4,242,252 $418,845 $313,220 5233,337 5(172,338) $5,035,316 Operating expenses 3,024,995 269,663 247,878 189,369 (172,338) 3,559,567 Selling and admin. expenses 478.996 19.825 45.193 32, 140 - 576.154 Margin S 738,261 $129,357 S 20,149S11 X828 5 - S 899,595 1995_ Revenue $4,249,829 $472,294 $301,248 $225,548 $(168,069) $5,080,850 Operating expenses 2,998,149 313,592 239,140 176,184 (166,869) 3,560,196 Selling and admin. expenses 485.811 21,970 44.393 35, 678 - 587.852 Margin S 765.869 5136,732 S 17,715 S 13. 686 S (1,200) S 932.802 Waste Services - operating results for the three months and six months ended June 30 were as follows: Three Months Six Months 1996 1995 1996 _ 1995 Revenue $2,204,738 $2,217,204 54,242,252 $4,249,829 Operating expenses 1,571,011 1,564,937 3,024,995 2,998, 149 • Selling and admin. expenses 241.439 248.476 478.996 q85, Margin 5 392,288 5 403.791 S 738.261 5765,869 Revenue by source for the three months and six months ended June 30 is shown in the following table: Three Months Six Months Percentage Percentage North America 1996 1995 Incrl (Decr) 1996 1995 :ncr/(Decri Residential $ 319,418 $ 304,307 S.C% $ 631,835 S 597,394 5.89 Commercial 419,188 408,089 2.7 824,232 802,400 2.7 Rolloff and industrial 360,002 343,299 4.9 675,849 648,382 4.2 Disposal, transfer and other* 528,008 549,194 (3.9) 984,665 988,957 (0.4) Industrial services 113,686 150,148(24. 3) 221,417 321,309 (31.1) International 464.436 462, 167 0.5 904.254 _ 891.387 1.4 Total S2,204,738 $2.217,204 (0. 6)% 54 , 242,252 54,249,829 (0.2)% 'Includes hazardous waste revenue of $12:, 751 and $252,938, respectively, for the three month and six month periods of 1>96 and $'161,455 and $291 ,936 for the comparable 1995 periods. • 15 Revenue declined to $215.6 million in the second quarter of 1996, from $221.1 • million in the second quarter of 1995. Revenue growth from the Lisbon, Connecticut, waste-to-energy plant, which-began commercial operations in January f996, an industrial cogeneration facility acquired in Martell, California, and increased electric purchases by the utility customer of the Company, s California independent power facilities was more than offset by the abeence of conetructiI revenue from the Lisbon facility, on which contributed $8.6 million in the second quarter of 1995, and a continuing revenue decline in the clean air business, which in included in this segment. Air business revenue declined 19% compared with the second quarter of 1995, reflecting continuing industry-wide weakness in the face of regulatory uncertainties. For the six months, segment revenue declined $53.5 million to $418.8 million, due to the foregoing factcrs as well as lower spot pricing for trash disposal in the first quarter of 1996 in areas of Florida. Operating expenses were 63.6% of revenue for the three months ended June 30, 1996, compared with 65.0% of revenue during the June 30, 1995 quarter. This Improvement resulted primarily from the abeence of construction revenue on the Lisbon facility, which had no associated margin. Selling and administrative expenses declined to 4.2% of 1996 second quarter revenue from S.o% of revenue in the comparable quarter of 1995. Improved air business results and lower energy development expense were responsible for the improvement. For the six months ended June 30, operating expenses were 64.4% of revenue in 1996 and 66.4% of revenue in 1995, while selling and administrative expenses were 4.7% of revenue in 1996 compared with 4.6t in 1995. The lower operating expense percentage was again largely the result of the absence of no-margin Lisbon constructicn revenue. Clean water - Operating results for the three months and six months ended June 30 were an follows: • Three Months Six Months 1996 1995 1996 --i2-9 5 Revenue $162,960 $164,213 $313,220 Operating expenses 128,980 129,167 247878 $301,248 Selling and , 239,140 admin. expenses 22.605 22.811 45. 193 44.3ga Margin S 11,375 S12,235 S 20,149 S 17,715 Second quarter 1996 revenue of $163.0 million was down slightly from the $164.2 million in the second quarter of 1995, as lower revenue from North American and European water process businesses more than offset growth from acquisitions made during the past twelve months. Water process business revenues were negatively impacted by a large project being completed in 1995 and the timing of contract execution on orders booked late in 1995 and early in 1996. In addition, European reveseFir gment was negatively impacted by a weak German economy and a stronger dollar. revenue grew $12.0 million to 5313.2 million in 1996 from $301.2 million in 1995. Acquisitions accounted for approximately $9.0 million of the growth with the balance coming from strong biosolids and contract operations and the Asian market, partially offset by the lower water process revenue in Europe and North America. Operating expenses were virtually unchanged in the second quarter of 1996 compared with the same period of 1995, but increased as a percentage of revenue to 79.1% from 78.7% in the previous year. Selling and administrative expenses were constant between years in both dollars and as a percentage of revenue. For the first six months of 1996, both operating expenses and selling and administrative expenses increased slightly in dollars but declined slightly as a percentage of revenue. The increase in selling and administrative costs was • due largely to the growth of Asian operations. 17 Interest - • She following table seta forth the components of consolidated interest, net, for the three months and six months ended June 30, 1996 and 1995: Three Months Six t+onths X996 1995 1996 1995 Interest expense $117,100 $131,146 $233,589 $257,405 Interest income (6,857) (14,463) (13,699) (23,349) Capitalized interest (17.497) (19.299) (34.671) (39,035) Interest expense, net S 92,746 S 97,384 S185,219 $195,021 The lower net interest expense in 1996 is a function of lower rates, including the benefit of refinancing certain debt, offsetting a reduction in capitalized interest and the impact of debt incurred to buy back the public ownership of CWM and Rust during 1995. Capitalized interest has declined as a result of continuing management effort to reduce capital expenditures. In the second quarter of 1996, WMX repurchased 5.0 million shares of its common stock and WTI repurchased 15.4 million of its shares (see ' Financial Condition - Capital Structure' below) . The debt incurred to fund these purchases will increase interest expense during the last half of 1996. Minority Interest - Minority interest declined in the second quarter and first six months of 1996 • compared with the same periods in 1995 as a result of the purchase of the public shares of CWM and Rust in 1995, and stock repurchases by WTI, which have increased the WMX ownership of WTI to approximately 65% at June 30, 1996. Accountina Principles - Effective January 1, 1996, the Company adopted Statement of Financial Accounting Standards ('FAS' ) No. 121 - Accounting for the Impairment of Long- Lived Assets and for Long-Lived Assets to Be Disposed Of. The adoption of this standard did not have a material impact on the financial statements. The Financial Accounting Standards Board has alsb issued FAS No. 123 - Accounting for Stock-Based Compensation - which the Company must adopt in 1996. This statement provides an optional new method of accounting for employee stock options and expands required disclosure about stock options. If the new method of accounting is not adopted, the Company will be required to disclose pro forma net income and earnings per share as if it were. The Company is studying FAS No. 123 and is gathering data necessary to calculate compensation in accordance with its provisions, but has not decided whether to adopt the new method or quantified its impact on the financial statements. Derivatives - From time to time, the Company and certain of its subsidiaries use derivatives to manage currency, interest rate, and commodity (fuel) risk. Derivatives used are simple agreements which provide for payments based on the national amount, with no multipliers or leverage. The Company' s use of derivatives has not been and is not expected to be material with respect to financial condition or results of operations. • 19 • Accuisitions and Capital Expenditures - Capital expenditures, excluding property and equipment of purchased businesses, were $577.8 million for the six months ended June 30, 1996, and $585:0 million for the comparable period in 1995. In addition, the Company and its principal • subsidiaries acquired 67 businesses for $92.8 million in cash and debt (including Aebt assumed) and 8.0 million shares of -rMx common stock during the first six months of 1996. For the first half of 1995, 59 businesses were acquired for $119.6 million in cash and debt (including debt assumed) and 0.4 million shares of WHX common stock. The pro forma effect of acquisitions made during 1995 and 1996 is not material. capital Structure - The Boards of Directors of wmx and WTI have authorized their respective companies to repurchase shares of their own common stock (up to 25 million shares In the case of WMX and 20 million shares in the case of WTI) in the open market or in privately negotiated transactions. These programs extend into 1997. WTI repurchased 19.2 million shares under its program, including 15.4 million in the second quarter and 18.4 million during the first six months of 1996. WMX had repurchased 5.0 million shares through June 30, 1996, all during the second quarter of the current year. In conjunction with its authorized repurchase program, WMX periodically sells put options on its own common stock. The put options give the holders the right at maturity to require the Company to repurchase its shares at specified prices. Proceeds from the sale of the options are credited to additional paid-in capital. In the event the options are exercised, the Company may elect to pay the holder in cash the difference between the strike price and the market price of the Company' a shares in lieu of repurchasing the stock. At June 30, 1996, put options were outstanding on 12.5 million shares, 4.7 million of which subsequently expired unexercised as the price of the Company' s stock was in excess of the strike price at maturity. The remaining options expire in October and November of 1996 with strike prices of $33.45 to $35.17 per share. Excluding debt of acquired companies and the impact of currency translation, • net debt increased $172.2 million in the second quarter and $436.2 million during the first six months of 1996. The increase was primarily a result of the share repurchases by the Company and WTI. Contincencies - WH International has received an assessment of approximately 417 million Krona (approximately $63 million) from the Swedish Tax Authority, relating to a transaction completed in 1990. WM International believes that all appropriate tax returns and disclosures were filed at the time of the transaction and intends to vigorously contest the assessment. 0 There have been no significant developments in regard to this matter during the first six months of 1996. A subsidiary of WHI has been involved in litigation challenging a municipal zoning ordinance which restricted the height of its New Milford, Connecticut, landfill to a level below that allowed by the permit previously issued by the Connecticut Department of Environmental Protection ('DEP' ) . The WHI subsidiary is presently under an order of the Superior Court to apply to the DEP for permission to remove all waste above the height allowed by the zoning ordinance. The Company believes that the removal of such waste is an inappropriate remedy and has appealed the Superior Court order to the Connecticut Supreme Court. The Company is unable to predict the outcome of this appeal or the nature and extent of any removal action that might ultimately be required. However, if the Superior Court order is not modified, the subsidiary could incur substantial costs, which approved could vary significantly depending upon the nature of any plan eventually by the applicable regulatory authorities, the actual volume of waste to be moved, and other factors, and which could have a material adverse effect on the Company' s financial condition and results of operations in the near term. • 21 PART II - OTHER INFORMATION . • 'ITEM 1. Local Proceedinae. The majority of the businesses in which the Company is engaged are intrinsically connected with the protection of the environment and the potential for the unintended or unpermitted discharge of materials In the ordinary course of conducting its business activitieinto the environment. s, the Company becomes involved in judicial and administrative proceedings involving governmental authorities at the federal, state and local level, including, in certain instances, proceedings instituted by citizens or local governmental authorities seeking to overturn governmental action where governmental officials or agencies are named as defendants together with the Company or one or more of its subsidiaries, or both. In the majority of the situations where proceedings are commenced by governmental authorities, the matters involved relate to alleged technical violations of licenses or permits pursuant to which the Company operates or is seeking to operate or laws or regulations to which its operations are subject, or are the result of different interpretations of the applicable environmental From time to time the Company pays fines or penalties in proceedings relatingprimarily to waste treatment, storage or disposal or trash-to-energy facilities. As of June 30, 1996, neither the Company nor any of its subsidiaries was involved in any such proceeding where it is believed that sanctions involved may exceed 5100,000. Subject to the discussion below concerning the Company's New Milford, Connecticut landfill, the Company believes that these matters will not have a material adverse effect on its results of operation or financial condition. However, the outcome of any particular ssibility remainsthat technologi al,regula orycordenforcem enforcement de ewith certainty�lopm nt a tand he results of environmental studies or other factors could materially alter this expectation at any time. In May 1996, a Company subsidiary paid a civil penalty of $203,000 to • settle an administrative proceeding brought by the United States Environmental Protection Agency involving alleged failure by the subsidiary in 1985 to test incoming loads of polychlorinated biphenyl wastes at the subsidiary's model City, New York facility. In settling this matter, the subsidiary did not admit any violation of law. A subsidiary of the Company has been involved in litigation challenging a municipal zoning ordinance which restricted the height of its New Milford, Connecticut landfill to a level below that allowed by the permit previously issued by the Connecticut Department of, Environmental Protection ("DEP") . Although a lower court had declared the zoning ordinance's height limitation unconstitutional, the Connecticut Supreme Court reversed that ruling and remanded the case for further proceedings in the Superior Court in the judicial district of Litchfield. On November 8, 1995, the Superior Court ordered the Company's subsidiary to apply to the DEP for permission to remove all waste above the height allowed by the zoning ordinance. The company believes that removal of such waste is an inappropriate remedy and its subsidiary has appealed the Superior Court order to the Connecticut Supreme Court. The Company is unable to predict the outcome of the appeal or any removal action that may ultimately be required following further appeals or as a result of the permitting process. However, if the lower court order as to removal of the waste is not modified, the subsidiary could incur substantial costs, which could vary significantly depending upon the nature of any plan which is eventually approved by applicable regulatory authorities for removing the waste, the actual volume of waste to be moved and other currently unforeseeable factors and which could have a material one or more future periods. adverse effect on the Company's financial condition and results of operations in ITEM 4. Submission of Matters to vote of security Holders. At the any's annual meeting of to elect the nominees listed in the followings tableasndire direcMay 10tors, thepCompany • was submitted to a vote of the Company's stockholders. The following table also 23 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed an its behalf by the undersigned thereunto duly authorized. WMX TECHNOLOGIES, INC. /e/ SAALS E. xomi u James E. Koenig Senior Vice President and Chief Financial Officer . August 12, 1996 • 25 EXH:3IT 12 WMX TECHNOLOGIES, INC. Ratio of Earnings to Fixed Chargee (Unaudited) (millions of dollars, except ratio) Six Months Ended n...e an 1995�1i 1 96 Income From Continuing Operations Before Income Taxes, Undistributed Earnings from Affiliated Companies and Minority Interest . . . . . . . $595.0 $735.6 Interest Expense . . . . . . . . . . . . . . . . 257.4 233.6 Capitalized Interest . . . . . . . . . . . . . . (39.0) (34.7) One-Third of Rents Payable in the Next Year . • 5.6 26.9 Income From Continuing Operations Before Income Taxes, Undistributed Earnings from Affiliated Companies, Minority Interest, Interest and • One-Third of Rents . . . . . . . . . . . . . 839.061.4 Interest Expense . . . . . . . . . . . . . . . . $257.4 �— $233.6 One-Third of Rents Payable in the Next Year . ' 25.6 26.9 Interest Expense plus One-Third of Renta . . . 283.0 �� 260.5 Ratio of Earnings to Fixed Chargee . . . . . . 2.96 to 1 3.69 to 1 (1) The results for 1995 include a special charge ($140.6 million before income taxes) , recorded by the Company' s Chemical waste Management, Inc, subsidiary, primarily related to a writeoff of certain investments in hazardous waste treatment and processing technologies and facilities. Excluding the effect of this charge, the ratio of earnings to fixed charges would be 3.46 to 1. SECURITIES AND EXCHANGE CONMUSSION • • WASHINGTON, D.C. 20549 FORM 10-K x❑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECLBIMS EXCHANGE ACI'OF 1934 For the Fiscal Year Ended December 31, 1995 ❑ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1.7327 WMX TECHNOLOGIES, INC. (Exact name of registrant as specified in its charter) DELAWARE 36-2660763 (State or other jurisdiction of (HRS Employer incorporation or organization) Identification No.) 3003 BUTTERFIELD ROAD. OAK BROOK, ILLINOIS 60521 (Address of principal executive office) (Zip rode) Registrant's telephone number, including area code: (708) 572-8800 Securities registered pursuant to Section 12(b) of the Am Title of Each Clan Name of Each Exehaage on Which Registered • Common Stock,$1.00 par value New York Stock Exchange Zurich Stock Exchange Chicago Stock Exchange Geneva Stock Exchange London Stock Exchange Basle Stock Exchange Frankfurt Stock Exchange Liquid Yield Option Notes due 2001 New York Stock Exchange &Y4% Debentures due 2018 New York Stock Exchange Liquid Yield Option Notes due 2012 New York Stock Exchange Chemical Waste Management, Inc Liquid Yleid Option Notes due 2010 New fork Stock Exchange Convertible Subordinated Notes due 2005 New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark whether the registrant ( I) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports). and ('_) has been subject to such filing requirements for the past 90 days. Yes N No _ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of reeistrant's knowledge, in definitive proxy or information statements incgrporated be reference in Part III of this Form 10-K or any amendment to this Form l0-K. ❑x The aggregate market value of the voting stock of the registrant held by stockholders who were not affiliates (as defined by regulations of the Securities and Exchange Commi«;onr of the registrant was approximately$14,457,190.000 at February 1, 19961based on the closing sale price on the New York Stock Exchange Composite Tape on January 31. 1996, as reported by The Wall Street Journal tftidwest • Edition)). At March 20. 19%,the registrant had issued and outstanding an aggregate of 495.395,743 shares of its common stock of record. Documents Incorporated by Reference Those sections or portions of the registrant's 1995 Annual Report to Stockholders and of the registrant's proxy statement for the Annual fleeting of Stockholders to be held on May 10. 1996 described in Parts II. 111 and IV hereof are incorporated by reference in this report NVMX TECHNOLOGIES. INC. EXHIBIT INDEX • Number and Description of Exhibit' 1. Inapplicable ' Inapplicable 3.1(a) Restated Certificate of Incorporation of registrant. as amended as of May 24, 1985 (incorporated by reference to Exhibit 4.1 to registrant's report on Form 10-Q for the quarter ended June 30. 1985 i 3.1(b) Certificate of Amendment of Restated Certificate of Incorporation of registrant, recorded May '_3. 1986 (incorporated by reference to Exhibit 4(c) to registrant's registration statement on Form S-8. Registration No. 33-6265) 3.1(c) Cemficate of Designation of Preferred Stock of registrant. filed January 30, 1987 (incorporated be reference to Exhibit 3.1(c) to registrant's 1986 annual report on Form 10-K) 3.1 I'd) Certificate of Amendment of Restated Certificate of Incorporation of registrant, recorded Mav 15. 1987 (incorporated by reference to Exhibit 4.5(d) to registrant's registration statement on Form S-1, Registration No. 33-15518) 3.1(e) Certificate of Amendment of Restated Certificate of Incorporation of registrant, filed May 19. 1989 (incorporated by reference to Exhibit Re) to registrant's registration statement on Form S-3. Registration No. 33-30190) 3.1 if) Certificate of Amendment of Restated Certificate of Incorporation of registrant, filed May 18, 1990 (incorporated by reference to Exhibit 4(h) to registrant's registration statement on Form S-8. Registration No. 33-35936) 3.:;g) Certificate of Amendment of Restated Cenificatz of Incorporation of registrant, filed May 14, 1993 • (incorporated by reference to Exhibit 4(a) to registrant's report on Form 8-K dated May 14, 1993) 3.1(h) Conformed copy of Restated Certificate of Incorporation of registrant, as amended (incorporated by reference to Exhibit 4(b) to registrant's report on Form 8-K dated May 14, 1993) 3.2 By-laws of registrant, as amended and restated as of January 23. 1995 (incorporated by reference to Exhibit 3.2 to registrant's 1994 annual report on Form 10-K) 4.1(a) Rights Agreement dated as of February 6. 1987. betvveen the, registrant and Hams Trust and SaNinits Bank. which includes as Exhibit A the form cf Cenificate of Designation of Preferred Stock. as Exhibit B. the form of Rights Cenificate and. L� Exhibit C. the Surnmary of Rights iincomorated be reference to Exhibit 4 to registrant's report on Font 8-K :aced Januan _6. 1987 4.1(") Cerflcate of Adjustment relating to April 198. stock spiit pursuant to Section 12 of the Rights Agreement (incorporated by reference to Exhibit 4.3(b i to regis-rtt's registration statement on Form S-1. Registration No. 33-13839) - 4.1 :i Cer3cate of Adjustment relating to December 1.989 stock split pursuant to Section 1_ of the Riehts Agreement (incorporated by reference to Exhibit 4.3(ci retttstrant's 1989 annual report on Form 10-K 4.1a) Trust Indenture dated as of August I. 1989 )ince:-orated h•: reference to Exhibit 4.3(a) to registrant s 1990 annuai report on Form 10-K) 4.1) First Supeiemental Indenture dated as of December i. :390 incorporated by reference to Exhibit 4.3i'^i to registrant's 1990 annuai report on For- :0-Ki "In the case of incorporation by reference to document ^led uncer the Secunties Exchange Act of 193=. the is registrant s file number under that Act is 1--?1_7. Chemical « aste Management. Inca, rile number ender .`tat Act %%as 1-9==3 and Wheeiabrator Technoloeies :`nc-'s file nurrrer under that Act is 0-14_46. EX-; Number and Descnpdon of Exhibit* 10.15 Restncted Unit Plan for Non-Employee Directors of Wheelabrator Technologies Inc. as amended through June 10. 1991 (incorporated by reference to Exhibit 19.03 to the report on Form 10-Q of • Wheelabrator Tecrnoiogies Inc. for the quarter ended June 30. 19911 10.16 1988 Stock Plan for Executive Employees of Wheelabrator Technologies Inc. and its subsidiaries (the "WTI 1988 Stock Plan") (incorporated by reference to Exhibit 28.1 to Amendment No. 1 to the registration statement of Wheelabrator Technologies Inc. on Form S-8, Registration No. 33-31523) 10.17 Amendments dated as of September 7, 1990 to the WTI 1988 Stock Plan (incorporated by reference to Exhibit 19.02 to the 1990 annual report ea Form 10-K of Wheelabrator Technologies Inc.i 10.18 Amendment dated as of November 1, 1990 to the WTI 1988 Stock Plan (incorporated by reference to Exhibit 19.04 to the 1990 annual report on Form 10-K of Wheelabrator Technologies Inc.) 10.19 1986 Stock Plan for Executive Emplovees of Wheelabrator Technologies Inc. and its subsidiaries (the "WTI 1986 Stock Plan'') (incorporated by reference to Exhibit 28.2 to Amendment No. 1 to the registration statement of 1i'heelabrator Technologies Inc. on Form S-8. Registration No. 33-31523) 10.20 ,Amendment dated as of November 1, 1990 to the WTI 1986 Stock Plan (incorporated by reference to Exhibit 19.03 to the 1990 annual report on Form 10-K of Wheelabrator Technologies Inc.) 10.21 Employment Agreement dated as of April 1. 1995 between the registrant and D. P. Payne 1022 W71X Technologies. Inc. 1992 Stock Option Plan (incorporated by reference to Exhibit 10.31 to registrant's registration statement on Form S-1. Registration No. 33-3.38.19) 10.23 W`iX Technologies. Inc. 1992 Stock Option Plan for Non-Empioyee Directors (incorporated by reference to Exhibit 10.32 to registrant's registration statement on Form S-1. Registration No. 33- 44849) 10.21 Wheelabrator Technoioeies Inc. 1992 Stock Option Plan (incorporated by reference to Exhibit 10.45 . to the 1991 annual report on Form 10-K of Wheelabrator Technologies Inc.) 10.25 Deferred Director's Fee Plan of Wheelabrator Technologies Inc. adopted June 10, 1991 (incorporated by reference to Extubit 19.02 to the quarterly report on Form l0-Q of Wheelabrator Technologies Inc. for the quarter ended June 30. 1991) 10.26 Waste Management International plc Share Option Plan tincorporated by reference :o Exhibit 10,1 to the registration statement on Form F-i of Waste Management International pic. Registration No. 33- 46511) 10" Amendment dated as of December b, 1991 :o the WTI 1986 Stock Plan (incorpora;ea by reference to Exhibit 19.01 to the i991 annual report on Form 10-K of Wheelabrator Technoio2ies Inc.i 10._S Amendment dated as of December o, !99! :o the W'Tl 1988 Stock Plan (incorporatea by reference to Exhibit 19.02 to t.`.e 1991 annual report cn Form 10-K of Wheelabrator Tecnnolog:es Inc.i 10.39 Amendment dated as of December 6. 199! :o the Restricted Unit Plan for Non-E-n!ovee Directors of W-heeiabrator 'echnoie_les Inc. inccrcrated by reference to Exhibit 19.05 :,, :ne 1991 annual report on Form 10-K of Wheelabrator T.chnologies Inc.i 1030 First ,Amended an,: Restate-, Intemauonai Business Opportunities .A_reemeni b, anc _-one registrant. Chemical Waste `.lana-ement, Inc.. 'Wheelabrator Technoie res Inc.. `.Cas:- Nlanagement International. Inc.. 'A'aste Management international pic and Ru•t Intemaecnai i c.. dated as of Januar% !. 1993 .-.ccrpor_:.d be reference to Exhibit 2S to the reg:;ration s:atemer.: .on Forrr. S-3 of Whe.tabrator Tt.:: rneiogies Inc.. Regictrz!:en No. 33-59606 `In the case of incorpora_;n by reverence to der.:ments filed under :.^.e Seco:ties Escnans_e act of 1931, the • registrant s file .number _crier tr.at .Act is I--3=-. Chemical Waste Manacement. :::c. -:e number under that .Act -.%as I-9'-53 anc '-Cheei._crator Techno:ones Inc.'s file numpe2_-der that .Act r> 7-11216. EX-: PART ITEM 1. BUSIINESS. .ENERAL • WNIX Technologies, Inc. is a leading international provider of environmental and related services. Unless me context indicates to the contrary, as used in this report the terms "Company" and "WMX Technologies" refer to WMX Technologies. Inc. and its subsidiaries. The Company provides integrated solid waste management services in North America through Waste Management, Inc., a wholly owned subsidiary of the Company (referred to herein; together with its subsidiaries and certain affiliated companies providing waste management and related services, as "Waste Management"). The Company's solid waste management services are provided to commercial, industrial, municipal and residential customers, as well as to other waste management.companies and consist of solid waste collection, transfer, resource recovery and disposal services. As part of these services,the Company is engaged in providing, through its Recycle America, Recycle Canadaa and other programs, paper, glass, plastic and metal recycling services to commercial and industrial operations and curbside collection of such materials from residences; in removing methane gas from sanitary landfill facilities for use in electricity generation; and in providing medical and infectious waste management services to hospitals and other health care and related facilities. In addition, through Waste Management the Company provides street sweeping and parking lot cleaning services and Port-0- Let" portable sanitation services to municipalities and commercial and special event customers. Since mid-1995, Waste Management also has managed the scaffolding and other on-site industrial services businesses owned by the Company's Rust International Inc. subsidiary. The Company also provides hazardous waste management services in.North America. The Company's chemical waste treatment, storage, disposal and related services are provided through Waste Management and Chemical Waste Management, Inc., a wholly owned subsidiary of the Company (referred to herein, together with its subsidiaries, as "CWM"), and are provided to commercial and industrial customers, as well as to other waste management companies and to governmental entities. Through Advanced Environmental Technical Services, L.C., a 60%-owned subsidiary of the Company (referred to herein, together with its subsidiaries as "AETS"), -e Company provides on-site integrated hazardous waste management services, including hazardous waste identification, packaging, removal and recycling services to industrial, institutional and governmental customers. Through its Chem-Nuclear Systems, Inc. wholly owned subsidiary (referred to herein, together with its subsidiaries, as "Chem-Nuclear"), the Company also furnishes radioactive waste management services, primarily to electric utilities and governmental entities. The Company provides comprehensive waste management and related services internationally, primarily through Waste Management International plc, a subsidiary owned approximately 56% by the Company and 12% each by the Company's Rust International Inc. and Wheelabrator Technologies Inc. subsidiaries (referred to herein, together with its subsidiaries, as "Waste Management International."). Waste Management International provides a wide range of solid and hazardous waste management and related environmental services (or has interests in projects or companies providing such services) in ten countries in Europe and in Argentina. Australia, Brazil, Brunei. Hong Kong, Indonesia, Israel. Malaysia. New Zealand, Taiwan and Thailand. Waste Management International also has an approximately 20% interest in Wessex Water Plc, an English publicly traded company providing water treatment. water distribution, wastewater treatment and sewerage services ("Wessex"). Wheelabrator Technologies Inc.. an approximately 58%-owned subsidiary of the Company !referred to herein, together with its subsidiaries, as "WTI"", provides a wide array of environmental products and services that are primarily utilized in meeting the needs of municipalities and industry for clean energy and clean water. WTI's clean enemy group is a leading developer of facilities and systems for. and provider of services to, the trash-to-energy, energy, and independent power markets. Through the clean energy group. WTI develops, arranges financing for, operates and owns facilities that dispose of trash and other %vaste materials in an environmentalh, acceptable manner by recycling them into electrical or steam energy. Also within this group are •business units .vhich design, fabricate and install technologically advanced air pollution control and systems and ` P.inted on recvcted paper e For tnformanon relating to expenses and identifiable assets attributable to the Company's major business groups. see Note 13 to the Company's Consolidated Financial Statements filed as an exhibit to this report and incorporated by reference herein. For interim periods, the revenues and net income of certain of the Company's businesses may fluctuate for a number of reasons, including there being for some businesses less activity during the winter months. Regulatory or technological developments relating to the environment may require companies engaged in environmental services businesses, including the Company, to modify, supplement or replace equipment and facilities at costs which may be substantial. Because certain of the businesses in which the Company-is engaged are intrinsically connected with the protection of the environment and the potential discharge of materials into the environment a material portion of the Company's capital expenditures is, directly or indirectly, related to such items. See "Management's Discussion and Analysis of Results of Operations and Financial Condition" set forth on pages 16 to 24 of the Company's 1995 Annual Report to Stockholders (which discussion is filed as an exhibit to this report and incorporated by reference herein) for a review of property and equipment expenditures by the Company for the last three ,years. The Company does not expect such expenditures, which are incurred in the ordinary course of business, to have a materially adverse impact on its and its subsidiaries' combined earnings or its or its subsidiaries' competitive position in the foreseeable future because the Company's businesses are based upon compliance with environmental laws and regulations and its services are priced accordingly. _ Although the Company strives to conduct its operations in compliance with applicable laws and regulations. the Company believes that in the existing climate of heightened legal. political and citizen awareness and concerns, companies in the environmental services industry, including the Company, will be faced, in the normal course of operating their businesses, with fines and penalties and the need to expend funds for remedial work and related acthities with respect to waste treatment, disposal and trash-to-energy facilities. Where the Company concludes that it is probable that a liability has been incurred, a provision is made in the Company's financial statements for the Company's best estimate of the liability bp-sed on management's judgment and experience, • information available from regulatory agencies and the number, financial resources and relative degree of responsibility of other potentially responsible parties who are jointly and severally liable for remediation of a specific site, as well as the typical allocation of costs among such parties. If a range of possible outcomes is estimated and no amount within the range appears to be a better estimate than any other, then the Company provides for the minimum amount within the range, in accordance with generally accepted accounting principles. Such estimates are subsequently revised, as necessary, as additional information becomes available. While the Company does not anticipate that the amount of any such recision will have a material adverse effect on the Company's operations or nnancial condition, the measurement of environmental liabilities is inherently difficult and the possibility remains that technological. rceulatory or enforcement developments, the results of environmental studies. or other factors could materially a ter this expectation at any time. Such matters could have a material adverse impact on earnings for one or more fiscal quarters or ,years. % hile in general the Company's environmental services businesses have benefited substantially from increased goverarrtental regulation, the environmental services industry itself is subject to extensive and evolvine regulation by federal, state, local and foreign authorities. Due to the complexity of regulation of the industry and to public pressure, implementation of existing and future laws, regulations or initiatives by different levels of government may be inconsistent and difficult to foresee. In addition. the demand for certain of the Company's services may be adversely affected by the amendment or repeal. or reduction in enforcement of, federal. state and foreign laws and regulations on which the Company's businesses engaged in providing such services are dependent. Demand for certain of the Company's services may also be adversely affected by delays or reductions in funding, or failure of lezislame bodies to fund. agencies or programs under such laws and regulations. The Company makes a continuing effort to anticipate regulatory. political and legal developments that might affect its operations but is not always able to do so. The Company cannot predict the extent to which any legislation or regulation that may be enacted, amended, repealed or enforced, or any failure or delay in enactment or • enforcement of legislation or regulations or funding of agencies or programs. in the future may affect its operations. 3 in size, are usually provided to the customer as part of Waste Management's services. Stationary compactors. which compact the volume of the stored waste prior to collection. are frequently installed on the premises of large volume customers and are usually provided to these customers in conjunction with Waste Management's collection services. Containerization enables Waste Management to service most of its commercial and industrial customers with collection vehicles operated by a single employee. Compaction serves to decrease the frequency of collection. Commercial and industrial collection services (which include containerized service to apartment buildings) are generally performed under one- to three-year service agreements. Fees are determined by such considerations as market factors, collection frequency, type of equipment furnished, length of service agreement, type and volume or weight of the waste collected, distance to the disposal facility and cost of disposal. Residential Most of Waste Management's residential solid waste collection services are performed under contracts with, or franchises granted by, municipalities giving Waste Management exclusive rights to service all or a portion of the homes in their respective jurisdictions. Such contracts or franchises usually range in duration from one to five years. The fees received by Waste Management are based primarily on market factors, frequency and type of service, the distance to processing or disposal facilities and cost of processing or disposal. Residential collection fees are either paid by the municipalities out of tax revenues or service charges or are paid directly by the residents receiving the service. TRANSFER Waste Management operates 151 solid waste transfer stations. A transfer station is a facility where solid waste is received from collection vehicles and then transferred to, and in some cases compacted in, large, • specially constructed trailers for transportation to disposal or resource recovery facilities. This procedure reduces costs by improving utilization of collection personnel and equipment and improving the efficiency of transporting waste to final disposal facilities. The services of these facilities are provided to municipalities or counties and in most instances are also used by Waste Management and by other collection companies. Fees are generally based upon such considerations as market factors, the type and volume or weight of the waste transferred, the extent of processing of recyclable materials, the transport distance involved and the cost of disposal. RECYCLLNG AND ENERGY RECOVERY Recycling Waste Management provides recycling services in the United States and Canada through its Recycle Americas. Recvcle Canadax and other programs. Recycling involves the removal of reusable materials from the waste stream for processing and sale or other disposition for use in various applications. Participating commercial and industrial operations use containers to separate recyclable paper, glass. plastic and metal wastes for collection. processing and sale by Waste Management_ Fees are determined by such considerations as market factors, frequency of collection, type and volume or weight of the recyclable material, degree of processing required. distance the recyclable material must be transported and value of the recyclable material. As pan of its residential solid waste collection services, Waste Management engages in curbside collection of recyclable materials from residences in the United States and Canada. also through its Recycle Americas, Recvcle Canadax and other programs. Curbside recycling services generally +nvolve the collection of recyclable paper, glass. plastic and metal waste materials. which may be separated ty residents into different waste • containers or commingled with other recyclable materials. The recyclable materials are then typically deposited at a local materials recovery facility where mhey are sorted and processed-for resale. 6 e Suitable sanitary landfill facilities and permission to expand existing facilities may be difficult to obtain in some: areas because of land scarcity. local resident opposition and governmental regulation. As its existing facilities become filled in such areas, the solid waste disposal operations of Waste Management are and will . continue to be materially dependent on its ability to purchase, lease or obtain operating rights for additional sites or expansion of existing sites and to obtain the necessary permits from regulatory authorities to construct and operate them. In addition, there can be no assurance that additional sites can be obtained or that existing facilities can continue to be expanded or operated. However. management believes that the facilities currently available to Waste Management are sufficient to meet the needs of its operations in most areas for the foreseeable future. To develop a new facility, Waste Management must expend significant time and capital resources without any certainty that the necessary permits will ultimately be issued for such facility or that the Company will be able to achieve and maintain the desired disposal volume at such facility. If the inability to obtain and retain necessary. permits, the failure of a facility to achieve the desired disposall volume or other factors cause Waste Management to terminate development efforts for a facility, the capitalized development expenses of the facility may need to be written off. In varying degrees. Waste Management utilizes its own sanitary landfill facilities to accommodate its disposal requirements for collection and transfer operations. In 1993, 1994 and.1995 approximately 52%, 55% and 57%, respectively, of the solid waste collected by Waste Management was disposed of in sanitary landfill facilities operated by it. Usually these facilities are also used by other companies and government agencies on a noncontract basis for fees determined by such considerations as market factors and the type and volume or weight of the waste. RELATED SERVICES Waste Management also provides or manages several types of services which are compatible with its solid waste collection operations. Included in these operations are scaffolding and other on-site industrial services, medical and infectious waste management services, portable sanitation services and street sweeping and parking • lot cleaning services. Waste Management manages the business of Rust Industrial Services Inc., a subsidiary of Rust ("RIS"), providing scaffolding and other on-site industrial services. RIS provides scaffolding services primarily to the chemical, petrochemical and utilities industries. In most cases, the scaffolding services are provided in conjunction with periodic, routine cleaning and maintenance of refineries, chemical plants and utilities, although such services are also performed in connection with new construction projects. RIS also performs a variety of types of other industrial services—water blasting, tank cleaning,-explosives blasting, chemical cleaning, industrial vacuuming, catalyst handling. specialty chemicals and separation technologies—primarily for clients n the petrochemical. chemi and pulp and paper mciusmes, utilities and, to a lesser extent the public sector. RIS also provides on-site plant services, including providing personnel to perform mechanical and electrical services. equipment installation. welding, hearing, %entilating and air conditiorune ("HVAC"), warehousing and inventory management services and technical support in the area of industrial hygiene and safer• training RIS assists clients in the nuclear and utility indusmes in solving electrical, mechanical, engineering and related technical services problems. RIS also provides spent fuel storage trerackl services to the nuclear rower industry. Waste Management's medical and infectious waste management services consist of collecting, transporting, treating and disposing of medical and infectious waste generated by hospitals, pharmaceutical manufacturers, medical clinics. physician and dentist offices and other sources. Waste Management also provides portable sanitation services to municipalities and commercial customers. The portable sarutation services. .vhich are marke:ed under the Port-O-Lets trade name. are also used at numerous special events and public gatherings. Certain of these related services are marketed and performed primanly by employees operating out of Waste • Management's solid waste operations facilities w he also may have responsibility for some phase of solid waste marketing or operations. 3 hazardous waste management and remediation requirements. These factors have led to reduced demand and increased pressure on pricing for chemical waste manazement services, consequences which the Company expects to continue for the foreseeable future. • LOW-LEVEL AND OTHER RADIOACTIVE WASTE SERVICES Radioactive wastes with varying degrees of radioactivity are generated by nuclear reactors and by medical, industrial• research and governmental users of radioactive material. Radioactive wastes are generally classified as either high-level or low-level. High-level radioactive waste, such as spent nuclear fuel and waste generated during the reprocessing of spent fuel from nuclear reactors, contains substantial quantities of long-lived radionuclides and is the ultimate responsibility of the federal government. Low-level radioactive waste, which decays more quickly than high-level waste, largely consists of dry compressible wastes (such as contaminated gloves, paper, tools and clothing), resins and filters which have removed radioactive contaminants from nuclear reactor cooling water, solidified wastes from power plants which have become contaminated with radioactive substances and irradiated hardware. Chem-Nuclear provides comprehensive low-level radioactive waste management services in the United States consisting of disposal,processing and various other special services. To a lesser extent, it provides services with respect to radioactive waste that has become mixed with regulated chemical waste. Chem-Nuclear's radioactive disposal operations involve low-level radioactive waste only. Its Barnwell, South Carolina facility is one of two licensed commercial low-level radioactive waste disposal facilities in the United States and has been in operation since 1971. A trust has been established and funded to pay the estimated cost of decommissioning the Barnwell facility. A second fund. for the extended care of the facility, is funded by a surcharge on each cubic foot of waste received. Chem-Nuclear may be liable for additional costs if the extra charges collected to restore and maintain the facility are insufficient to cover the cost of restoring or maintaining the site after its closure (which Chem-Nuclear has no reason to expect). Under state legislation enacted in 1995, the Barnwell, South Carolina facility is authorized to operate until its current permitted disposal capacity is My utilized. unless such authorization is changed by legislation. However, presently pending L the South Carolina • Supreme Court is a suit challenging the 1995 legislation which repealed earlier legislation that would have closed the Barnwell facility to out-of-state wastes. While Chem-Nuclear believes the suit (to which it it not a party) lacks merit, it is impossible to predict the outcome of the suit and its impact on future operations at Barnwell. Chem-Nuclear also processes low-level radioactive waste at its customers' plants to enable such waste to be shipped in dry rather than liquid form to meet the requirements for receipt at disposal facilities and to reduce the volume of waste that must be transported. Processing operations include solidification, demineralization, dewatering and filtration. Other services offered by Chem-Nuclear include providing electro-chemical. abrasive and chemical removal of radioactive contamination, providing management services for spent nuclear fuel storage pools and storing and incinerating liquid radioactive orgastic wastes. INTERNATIONAL WASTE MANAGEMENT AND RELATED SERVICES The Company is a leading provider of comprehensive waste management and related services internationally, primarily through Waste Management International, which conducts essentially all of the waste management operations of the Company located outside North America. Waste Management International's business may broadly be characterized into two areas of activity, collection sen•ices and treatment and disposal services. The following table shows the derivation of Waste Management International's revenues for the years indicated and include# revenue from construction of treatment or disposal facilities for third parties under "Treatment and Disposal Services'' Year Ended December 31. 1993 1994 1995 Collection Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69% 64% 64% • Treatment and Disposal Services 31% 369c 36% 10 a frequency of collection pick-ups, and disposal arrangements. Longer-term contracts typically have formulae for periodic price increases or adjustments. Waste Management International also provides curbside recycling services similar to those provided by Waste Management in North America. . Street, industrial premises, office and parking lot cleaning services are also performed by Waste Management International, along with portable sanitationitoilet services for such occasions as outdoor concerts and special events. Waste Management International's commercial and industrial solid and hazardous waste collection services are generally contracted for by individual establishments. In addition to solid waste collection customers, Waste Management International provides services to small quantity waste generators, as well as larger petrochemical, pharmaceutical and other industrial customers. including collection of hazardous, chemical or medical wastes or residues. Waste Management International has approximately 285,000 commercial and industrial customers. Contract terms and prices vary substantially between jurisdictions and types of customer. Waste Management International also provides commercial and industrial recycling services. Treatment and Disposal Services Treatment and disposal services include processing of recyclable materials, operation of both solid and hazardous waste landfills, operation of municipal and hazardous waste incinerators, operation of a trash-to-energy facility, operation of water and wastewater treatment facilities. operation of hazardous waste treatment facilities and construction of treatment or disposal facilities for third parties. The operation of solid waste landfills is currently Waste Management International's most significant treatment and disposal service. Treatment and disposal services are provided under contracts which may be obtained through public bid or tender or direct negotiation, and art also provided directly to other waste service companies. At December 31, 1995. Waste Management International owned, operated or maintained 23 waste treatment facilities, 79 recycling and recyclables processing facilities. 9 incinerators and 55 landfills. • Once collected, solid wastes may be processed in a recyclables processing facility for sale or other disposition for use in various applications. Unprocessed solid wastes, or the portion of the waste stream remaining after recovery of recyclable materials, require disposal, which may be accomplished through Incineration (in connection with which the energy value may be recovered in a trash-to-energy facility) or through disposal in a solid waste landfill. 'Ilse relative use of landfills versus incinerators differs from country to country and will depend on many factors, including the availability of land. geological and hydrological conditions, the availability and cost of technology and capital, and the regulatory environment. The main determinant of disposal method is generally the disposal cost per cubic meter at local landfills, as incineration is generally more expensive. At present. in most countries in which Waste Management International operates, landfilling is the predominant disposal method employed. Waste Management International owns or operates solid waste landfills in Argentina. Australia, Brazil. Denmark. France, Germany. Hong Kong, Indonesia. Italy, New Zealand. Spain, Sweden and the United Kingdom. Landfill disposal agreements may be separate contracts or an integrated portion of collection or treatment contracts. Demand for solid waste incineration is affected by landfill disposal costs and government regulations. The incineration process fortnon-hazardous solid waste has also been influenced by two significant factors in recent years: (i) increasingly strict control over air emissions from incinerators: and (ii) increasing emphasis on trash-to- energy incinerators. which utilize heat produced by incinerators to generate electricity and other energy. Incineration generates approximately 30% residue (by weight), which is either landfilled or, if permitted. recycled for use as a road base or in other construction uses. Waste Management International's trash-to-energy incinerator in Hamm is a German-designed plant and the • only privately operated trash-to-energy facility in Germany. it is among the first trash-to-energy facilities to fully 12 w services for destroving or recycling volatile organic compounds ("VOCs") from air and liquid sources and NOx from air sources. Both VOCs and NOx are detrimental to air quality and the environment generally. WTI's VOC and NOx control systems are utilized by customers in a variety of industries. including oil refineries, chemical • plants and automobile production facilities. Complementing the emission control divisions is a measurement division which designs and installs continuous emissions monitoring systems for the utility, trash-to-energy, industrial furnace and petrochemical industries, all of which are affected by regulations requiring the continuous monitoring of stack emissions. Wheelabrator Clean Water Through Wheelabrator Water Technologies, Inc. and its subsidiaries. WTI develops, operates and owns pmjects that purify water, treat water and wastewater, compost organic wastes and treat and manage biosolids. WTI also provides products and systems used to treat drinking water as well as industrial and municipal process water and wastewater. WTI is a leading provider of a broad range of water and wastewater treatment services to municipalities and industry throughout the United States. Canada and Mexico, including water and wastewater treamtent plant start-up assistance, plant operations and maintenance. planning and management, training of plant supervisors, operators and laboratoryand maintenance personnel, refining process systems, management systems for process control, and plant diagnostic evaluations and energy audits. WTI also provides specialty repair and cleaning services for industrial water and wastewater management equipment. Ia July 1995, WTI became the first company in the United States to acquire a publicly owned wastewater treatment plant pursuant to a federal Executive Order issued in 1992 which was intended to facilitate the privatization of municipal facilities. The agreement provides for a subsidiary of WTI to operate the 4.5 million gallon per day MCD Franklin Wastewater Treatment Plant in Franklin, Ohio for a period of 20 years and to expand the facility as needed to meet future population growth. In August 1995, WTI was selected by the City • of Wilmington.Delaware to negotiate a similar public-private partnership, including the acquisition of that City's wastewater treatment plant. WTI also provides a range of biosolids management services, including land application,drying,pelletizing, alkaline stabilization and composting of non-hazardous biosolids to approximately 450 communities, typically pursuant to multi-year contracts under which WTI is paid by the generator to make beneficial use of the biosolids. Land application involves the application of non-hazardous biosolids as a natural fertilizer on farmland pursuant to rigorous site-specific permits issued by applicable state authorities. Biosohds are also used in land- reclamauon projects such as strip mines. Regulations issued by the EPA in December 1992 under the Clean Water Act encourage the beneficial use of municipal sewage sludge by recognizing the resource value of biosolids as a fertilizer and soil conditioner, and establish requirements for land application designed to protect human health and the environment. WTI also develops and operates facilities at which biosolids are dried and pelletized and has four facilities currently in operation, and one other facility under construction. WTI has approximately 560 dry-tons-per-day of biosolids drying capacity either in operation or under construction. Biosolids which have been dried are generally used as fertilizer by farmers, commercial landscapers and nurseries and as a bulking agent by fertilizer manufacturers. Development of dryer facilities generally involves various contractual arrangements with a variety of private and public entities, including municipalities (which generate the biosolids), lenders. contractors and subcontractors which build the facilities, and end-users of the fertilizer generated from the treatment process. WM also engineers and manufactures a variety of environmental products and systems. WTI provides single- source, advanced-systems solutions for the treatment of municipal drinking water. industrial process water and wastewater and for slum pumping and high solids dewatering. It also provides systems designed to remove • solids from liquid streams through the use of self-cleaning barifilter screens, grinders. macerators, conveyors and 14 A - Rust also engages in providing process engineering, construction, specialty contracting and related services, but has announced its intention to sell or otherwise discontinue that business in North America and certain locations outside North America. The process engineering services currently provided by Rust are of two general types: facility process engineering and facility design engineering. Process engineers create the processes by which facilities operate, such as chemical, petrochemical. energy and pulp and paper plants. Design engineering services provided by Rust encompass the following disciplines: architectural. electrical, control systems, process piping, mechanical, structural. HVAC, and civil. The construction services currently provided by Rust are generally performed in connection with projects on which Rust has also provided the design engineering services. Rust also requisitions and procures equipment and construction materials for clients and performs quality assurance and quality control oversight of vendor manufacturing practices. Rust also has scaffolding and other on-site industrial services businesses. which are managed by Waste Management. See "Waste Services-olid Waste Management, Recycling and Related Services—Related Services" above. REGULATION While in general the Company's environmental services businesses have benefited substantially from increased governmental regulation, the environmental services industry itself has become subject to extensive and evolving regulation by federal, state, local and foreign authorities. In particular, the regulatory process requires firms in the- Company's industries to obtain and retain numerous governmental permits to conduct various aspects of their operations, any of which may be subject to revocation,modification or denial. As a result of governmental policies and attitudes relating to the industries, which are subject to reassessment and change, the Company belidves that its ability to obtain applicable permits from governmental authorities on a timely basis, and to retain such permits, could be impaired. The Company is not in a position at the present time to assess the extent of the impact of such potential changes in governmental policies and attitudes on the permitting processes, but it could be significant. In particular, adverse decisions by governmental authorities on permit applications submitted by the Company may result in abandonment of projects, premature closure of facilities or restriction of operations, which could result in a loss of earnings from a facility, a write-off of capitalized development expenses or both. Federal, state, local and foreign governments have also from time to time proposed or adopted other types of laws, regulations or initiatives with respect to the environmental services industry. Included among them are laws, regulations and initiatives to ban or restrict the international, interstate or intrastate shipment of wastes, impose higher taxes on out-0f-state waste shipments than in-state shipments, reclassify certain categories of hazardous wastes as non-hazardous and regulate disposal facilities as public utilities. Certain state and local governments have promulgated "flow control" regulations. which attempt to require that all waste generated within the state or local jurisdiction must go to certain disposal sites. The United States Congress has from time to time considered legislation that would enable or facilitate such bans, restrictions, taxes and regulations. Due to the complexity of regulation of the industry and to public pressure, implementation of existing or future laws, regulations or initiatives by different levels of government may be inconsistent and difficult to foresee. Many state and local governments have enacted mandatory or voluntary recycling laws and bans on the disposal of yard-waste in landfills. The effect of these and similar laws is to reduce the volume of wastes that would otherwise be disposed in Company landfills. In addition, municipalines and other governmental entities with whom the Company contracts to provide solid waste collection or disposal services, or both. may require the Company as a condi.lion of securing the business to provide recycling services and operate recycling and composting facilities, which may cause the Company to incur substantial costs. The Company makes a continuing effort to anticipate regulatory, political and legal developments that might affect its operations but is not always able to do so. The Company cannot predict the extent to which any legislation or regulation that may be enacted. amended, repealed or enforced. or any failure or delay in enactment or enforcement of legislation or regulations or funding of government agencies or programs, in the future may affect its operations. Such matters could have a material adverse impact on the Company's earnings for one or more fiscal quarters or years. 16 recovery or disposal facilities. In addition. the Company's disposal facilities are subject to water and'air pollution laws and regulations. :Noise pollution laws and regulations may also affect the Company's operations. Governmental authorities have the power to enforce compliance with these various laws and regulations and • violators are subject to injunctions, fines and revocation of permits. Private individuals may also have the right to sue to enforce compliance. Safety standards under the Occupational Safety and Health Act ("OSHA") are also applicable to the Company's solid waste and related services operations. The EPA and various states acting pursuant to EPA-delegated authority have promulgated rules pursuant to RCRA which serve as minimum requirements for land disposal of municipal wastes. The rules establish more stringent requirements than previously applied to the siting, construction, operation and closure of all but the smallest municipal waste landfill facilities. In certain cases, the failure of some states to adopt the federal requirements may increase costs to meet inconsistent federal and state laws applicable to the same facility. The Company does not believe that continued compliance with the more stringent minimum.requirements will have a material adverse effect on the Company's operations. See also "RCRA" and "Superfund" below for additional regulatory information. In March 1996, the EPA issued regulations that requite large, municipal solid waste landfills to install and monitor systems to collect and control landfill gas. The regulations apply to landfills that are designed to accommodate 2.5 million cubic meters or more of municipal solid waste and that accepted waste for disposal after November 8, 1987, regardless of whether the site is active or closed. The date by which each affected landfill must have such gas collection and control system depends on whether the landfill began operation before or after May 30, 1991. Landfills constructed, reconstructed, modified or first accepting waste after May 30, 1991 generally must have systems in place by late 1998. Older landfills generally will be regulated by the states and will be required to have landfill gas systems in place within approximately 30 months of EPA's approval of the state program. Many state solid waste regulations already require collection and control systems. While the Company has not yet completed its study of the new regulations, compliance with them is not expected to have a material adverse effect on the Company. • HAZARDOUS WASTE .•fc Waste Management and CWM are required to obtain federal, state, local and foreign governmental permits for their chemical waste treatment, storage and disposal facilities. Such permits are difficult to obtain, and in most instances extensive geological studies, tests and public hearings are required before permits may be issued. Waste Management's and CWM's chemical waste treatment. storage and disposal facilities are also subject to sitine, zoning and land use restrictions, as well as to regulations jincluding certain requirements pursuant to federal statutes) which may govern operating procedures and water and air pollution. among other matters. In particular. Waste Management's and CNVM's operations in the United States are subject to the Safe Drinking Water Act (which regulates deep well injecuom. TSCA (pursuant to which the EPA has promulgated regulations concerning the disposal of PCBs). the Clean Water Act (which regulates the discharge of pollutants into surface waters and sewers by municipal, industrial and other sources( and the Clean Air Act (which regulates emissions into the air of certain potentially harmful substances). In their transportation operations, Waste Management and CWM are subject to the jurisdiction of the Interstate Commerce Commission and regulated by the DOT and by regulatory agencies in each state. Employee safety and health standards under OSHA are also applicable. Of Waste Management's and CWM's chemical waste treatment or disposal facilities in the United States, all but one have been issued permits under RCRA. The facility without an RCRA permit continues to have interim status. A final permit is to be issued jointly by the authorized state, subject to EPA oversight, and by the EPA. The regulations governing issuance of permits contain detailed standards for hazardous waste facilities on matters such as waste analysis. security, inspections, training, preparedness and prevention, emergency procedures, reporting and recordkeeping. Once issued, a final permit has a maximum fixed term of 10 years, and such permits for land disposal facilities are required to be reviewed five years from the date of issuance. The issuing agency (either the EPA or an authorized state) may review or modify a permit at any time during its . term. 18 w Environmental and Infrastructure Engineering and Consulting Services The practice of engineering and architecture is regulated by state statutes. All states require engineers and architects to be registered by their respective state registration boards as a condition to offering or rendering . professional services. Many states also require companies offering or rendering professional services, such as Rust, to obtain certificates of authority. Rust's businesses are also subject to OSHA regulations and to NRC regulations concerning services provided to nuclear power plants. RCRA Pursuant to RCRA, the EPA has established and administers a comprehensive. "cradle-to-grave" system for the management of a wide range of industrial by-products and residues identified as "hazardous" wastes. States that have adopted hazardous waste management programs with standards at least as stringent as those promulgated by the EPA may be authorized by the EPA to administer their programs in lieu of RCRA. Under RCRA and federal transportation laws, a transporter must deliver hazardous waste in accordance with a manifest prepared by the generator of the waste and only to a treatment. storage or disposal facility having a RCRA permit or interim status under RCRA. Every facility that treats or disposes of hazardous wastes must obtain a RCRA permit from the EPA or an authorized state and must comply with certain operating standards. The RCRA permitting process involves applying for interim status and also for a final permit Under RCRA and the implementing regulations, facilities which have obtained interim status are allowed to continue operating by complying with certain minimum standards pending issuance of a permit. RCRA also imposes restrictions on land disposal of certain hazardous wastes and prescribes standards for hazardous waste land disposal facilities. Under RCRA, land disposal of certain types of untreated hazardous wastes has been banned except where the EPA has determined that land disposal of such wastes and treaunent residuals should be permitted. The disposal of liquids in hazardous waste land disposal facilities is also prohibited. • .The EPA from time to time considers fundamental changes to its regulations under RCRA that could facilitate exemptions from hazardous waste management requirements, including policies and regulations that could implement the following changes: redefine the criteria for determining whether wastes are hazardous; prescribe treatment levels which. if achieved. could render wastes non-hazardous: encourage further recycling and waste minimization: reduce treatment requirements for certain wastes to encourage alternatives to incineration; establish new operating standards for combustion technologies: and indirectly encourage on-site remediation. To the extent such changes are adopted. they can be expected to adversely affect the demand for the Company's chemical waste management services. In this regard. the EPA has recently proposed regulations which would have the effect of reducing the volume of waste classified as hazardous for RCRA regulatory purposes. See "Regulation" above. In addition to the foregoing provisions. RCRA regulations require the Companv to demonstrate financial responsibility for possible bodily injury and property damage to third parties caused by both sudden and nonsudden accidental occurrences. See "Insurance" below. Also. RCRA regulations require the Company to provide financial assurance that funds will be available when needed for closure and post-closure care at its waste treatment, storage and disposal facilities, the costs of which could be substantial. Such regulations allow the financial assurance requirements to be satisfied by various means, including letters of credit. surety bonds, trust funds, a financial (net worth) test and a guarantee by a parent corporation. Under RCRA regulations. a company must pay the closure costs for a waste treatment. storage or disposal facility owned by it upon the closure of the facility and thereafter pay post-closure care costs. If such a facility is closed prior to its originally anticipated time, it is unlikely that sufficient funds will have been accrued over the life of the facility to fund such costs, and the owner of the facility could suffer a material adverse impact as a result. Consequently, it may be difficult to close such facilities to reduce operating costs at times when. as is currently the case in the hazardous waste services industry, excess treatment. storage or disposal capacity exists. 20 A new procedure for the adoption of waste management legislation (other than for proposals of a primarily fiscal nature i which it is predicted may result in the speedier implementation of EU waste laws. The impact of current and future EU legislation will vary from country to country according to the degree to which existing national requirements already meet or fall short of the new EU standards and, in some jurisdictions, may require extensive public and private sector investment and the development and provision of the necessary technology, expertise. administrative procedures and regulatory structures. 'These extensive laws and regulations are continually evolving in response to technological advances and heightened public and political concern. Outside Europe. continuing industrialization, population expansion and urbanization have caused increased levels of pollution with all of the resultant social and economic implications. The desire to sustain economic growth and address historical pollution problems is being accompanied by investments in environmental infrastructure. particularly in Southeast Asia, and the introduction of regulatory standards to further control industrial activities. The Company believes that Waste Management International's business is conducted in material compliance with applicable laws and regulations and does not anticipate that maintaining such compliance will adversely affect the Company's financial position. There can be no assurance, however, that such requirements will not change so as to require significant additional expenditures or operating costs. Waste Management International operates facilities in Hong Kong which are owned by the Hong Kong government. Control of the Hong Kong government passes to the People's Republic of China in 1997. Waste Management International is unable to predict what impact, if any, this change will have on its operations in Hong Kong. COMPETPPION . Waste Management encounters intense competition, primarily in the pricing and rendering of services,from various sources in all phases of its solid waste management and related operations. In the solid waste collection phase, competition is encountered, for the most part, from national, regional and local collection companies as well as from municipalities and counties (which, through use of tax revenues, may be able to provide such services at lower direct charges to the customer than can Waste Management) and some large commercial and industrial companies which handle their own waste collection. In the solid waste transfer, resource recovery and disposal phases of its operations, competition is encountered primarily from municipalities, counties, local governmental agencies. other national or regional waste management companies and certain large corporations not primarily involved in the solid waste management services business. The Company also encounters intense competition in pricing and rendering of services in its medical and infectious waste management. portable sanitation and street sweeping and parking lot cleaning services businesses from numerous large and small competitors. In its hazardous waste management operations, the Company encounters competition from a number of sources, including several national or regional Cams specializing primarily in chemical waste management, local waste management concerns and, to a much greater extent, generators of chemical wastes which seek to reduce the t olume of or otherwise process and dispose of such wastes themseh es. The basis of competition is primarily technical expertise and the price, quality and reliability of service. Waste Management International encounters intense competition from local companies and govemmenW entities in particular countries, as well as from maior international companies. Pricing, quality of service and type of equipment utilized are the primary methods of competition for collection services, and proximity of suitable treatment or disposal facilities. technical expertise, price, quality and reliability of services are the primary methods of competition for treatment and disposal services. allocations set forth in the preceding two paragraphs. In this connection CWM. WTI, Rust. the Company and Waste Management International have agreed that in order to minimize the potential for conflicts of interest among various subsidiaries under the common control of the Company and for so long as the Company shall • have beneficial ownership of a majority of the outstanding voting equity interests of such subsidiary (or anoption to obtain such ownership), the Company has the right to direct furare business opportunities to the Company or the Company-controlled subsidiary which. in the Company's reasonable and good faith judgment has the most experience and expertise in that line of business. provided that the Company may not allocate a business opportunity to a particular subsidiary if such business opportunity would involve the subsidiary in a breach of its agreement not to compete as described in the immediately preceding paragraphs. Opportunities outside North America relating to the provision of future waste management services are generally to be allocated to Waste Management International, except that opportunities outside North America relating to the WTI Allocated Activities and the Rust Allocated Activities are generally to be allocated to WTI and Rust, as the case may be. Environmental opportunities other than waste management activities are to be allocated in the Company's good faith judgment. No party.is liable for consequential damages, except for lost profits, for any breach of the MOA. In addition, in connection with the transfer by Rust of its hazardous and radioactive substance remediation business (see "Acquisitions and Dispositions" below), the Company, Rust and their respective wholly owned affiliates agreed with OHM not to engage in providing on-site hazardous and radioactive substance remediation services in North America prior to 2002. INSURANCE While the Company believes it operates professionally and prudently, its business exposes it to risks such as the potential for harmful substances escaping into the environment and causing damage or injuries,the cost of which could be substantial.The Company currently maintains liability insurance coverage for occurrences under various environmental impairment, primary casualty and excess liability insurance policies. . The Company's insurance program includes coverage for pollution liability resulting from "sudden and accidental" releases of contaminants and pollutants. The Company believes that the coverage terms, available limits of liability, and costs currently offered by the insurance market do not represent sufficient value to warrant the purchase of "non-sudden and accidental" pollution liability insurance coverage. As such, the Company has chosen not to purchase risk transfer "non-sudden and accidental" pollution liability insurance coverage. To satisfy existing government requirements, the Company has secured non-risk transfer pollution liability insurance coverage in amounts believed to be in compliance with federal and state law requirements for "non-sudden and accidental" pollution. The Company must reimburse the insurer for-tosses incurred and covered by this insurance policy. In the event the Company continues not to purchase risk transfer "non-sudden and accidental" pollution liability insurance coverage, the Company's net income could be adversely affected in the future if "non-sudden and accidental" pollution losses should occur. EMPLOYEES WMX Technologies and its subsidiaries employ a total of approximately -1 3.200 persons in their worldwide continuing operations. Of this number, the Company employs approximately 38,700 persons in its North American solid and hazardous waste management services operations (excluding employees of the Rust scaffolding and other on-site industrial services business operated by Waste Management). Of this total, 35,900 persons are engaged in its Waste Management solid waste and related services operations, including approximately 27.200 persons employed in solid waste collection. transfer, resource recovery and disposal activities, and approximately 8.700 managerial, executive, sales, clerical, data processing and other solid waste and related activities. Approximately 2,500 employees are employed in the Company's hazardous waste services business, including 100 as managers or executives. Approximately 2.000 are employed in hazardous waste treatment, storage and disposal activities (including approximateiv 530 performing technical. analytical or • engineering services I, and approximately '00 are employed in sales, clerical, data processing and other hazardous waste-related activities. ,,t R and by a majority of the public stockholders of CWM. As a result of the Merger. CWAS became a wholly owned subsidiary of the Company. On March 14, 1995, the Company's Board of Directors approved a plan to reduce the scope of the • Company's chemical waste management services business by selling or otherwise eliminating technologies and service locations which were not meeting customer service or performance objectives. See "Management's Discussion and Analysis of Results of Operations and Financial Condition-1995 Operations Compared with 1994--CWM," incorporated by reference in this report, for further information. In May 1995, OHM acquired Rust's hazardous and radioactive substance remediation business in exchange for an approximately 37% interest in OHM. In exchange for warrants to acquire an additional approximately 2.690 of OHM common stock, the Company also agreed in that transaction to guarantee up to $62 million of indebtedness of OHM. In July 1995, the Company acquired the approximately 4% of Rust's shares held by the public for $16.35 per share in'cash. The transaction was approved by a special committee of independent directors appointed by the Rust Board of Directors. As a result of that trinsaction, Rust became owned 60% by the Company and 40% by WTI. - Additionally, Rust'has announced its intention to sell or otherwise discontinue its process engineering, construction, specialty contracting and related services business. The terms of .the sale have not yet been determined.The Company expects the sale of those portions of the business which are to be sold to be completed in 1996. In December 1995, the Company contributed its approximately 28% interest in ServiceMaster Consumer Services LP. ("SMCS"), a provider of lawn care, pest control and other consumer services, to ServiceMaster LP. ("SMLP"), the owner of the remaining interest in SMCS, in exchange for an approximately 19% interest in SNILP and an option to purchase up to 1.25 million SMLP limited parmetship shares. The Company has also acquired numerous companies and interests is companies internationally through Waste Management International or its predecessors. See "International Waste '.Management and Related Services." rMM 2. PROPERTIES. The principal property and equipment of the Company consists of land (primarily disposal sites), buildings and waste treatment or processing facilities (other than disposal sites), and vehicles and equipment, which as of December 31. 1995 represented approximately 18%, 6% and 27%, respectively, of the Company's total consolidated assets. The Company believes that its vehicles, equipment and operating properties are well maintained and suitable for its current operations. See "Management's Discussion and Analysis of Results of Operations and Financial Condition" filed as an exhibit to this report and incorporated by reference herein for a discussion of property and equipment expenditures by the Company for the last three years and the capital budget for 1996. The Company's subsidiaries lease numerous office and operating facilities throughout the world. For the year ended December 31, 1995, aggregate annual rental payments on real estate leased by the Company and its subsidiaries approximated $140.367,000. The principal fixed assets of Waste Management consist of vehicles and equipment (which include, among other items, approximately 20,800 collection and transfer vehicles. 1,568.600 containers and 21.000 stationary compactors in the United States and Canada). Waste Management owns or leases real property in most states and Canadian provinces in which it is doing business. At December 31. 1995. 103 solid waste disposal facilities. aggregating approximately 65,740 total acres, including approximately 14,290 permitted acres, were owned by Waste Management in the United States and Canada and 30 facilities• aggregating approximately 13.340 total • acres, including approximately 5,860 permitted acres, were leased from parties not affiliated with Waste 26 w subsidiaries of the Company (or their predecessors) transported hazardous substances to the facilities in question. often prior to acquisition of such subsidiaries by the Company. Such proceedings arising under Superfund typically involve numerous waste generators and other waste transportation and disposal companies and seek to • allocate or recover costs associated with.site investigation and cleanup, which costs could be substantial. As of December 31, 1995, the Company or its subsidiaries had been notified that they are potentially responsible patties in connection with 106 locations listed on the Superfund National Priority List ("NPL"). Of the 106 NPL sites at which claims have been made against the Company, 19 are sites which the Company has come to own over time. All of the NPL sites owned by the Company were initially sited by others as land disposal facilities. At each of the 19 owned facilities, the Company is working in conjunction with the government to characterize or to remediate identified site problems. In addition. at these 19 facilities the Company has either agreed with other legally liable parties on an arrangement for sharing the costs of remediation or is pursuing resolution of an allocation formula.The 87 NPL sites at which claims have been made against the Company and which are not owned by the Company are at different procedural stages under Superfund. At some, the Company's liability is well defined as a consequence of a governmental decision as to the appropriate remedy and an agreement among liable patties as to the share each will pay for implementing that remedy. At others, where no remedy has been selected or the liable parties have been unable to agree on an appropriate allocation, the Company's future costs are substantially uncertain. The Company periodically reviews its role, if any, with respect to each such location, giving consideration to the nature of the Company's alleged connection to the location(e.g.,owner, operator, transporter or generator), the extent of the Company's alleged connection to the location (e.g., amount and nature of waste hauled to the location, number of years of site operation by the Company or other relevant factors), the accuracy and strength of evidence connecting the Company to the location,the number,connection and financial ability of other named and unnamed potentially responsible parries at the location, and the nature and estimated cost of the likely remedy. Where the Company concludes that it is probable that a liability has been incurred. a provision is made in the Company's financial statements for the Company's best estimate of the liability based on management's judgment and experience, information available from regulatory agencies and the number, financial resources and relative degree of responsibility of other potentially responsible parties who are jointly and severally liable for remediation of a specific site, as well as the typical allocation of costs among such parties. If a range of possible outcomes is estimated and no amount within the range appears to be a better estimate than any other, then the Company provides for the minimum amount within the range, in accordance with generally accepted accounting principles. Sites subject to state action under state laws similar to the federal Superfund statute are treated by the Company in the same way as NPL sites. The Company's estimates are subsequently revised. as deemed necessary, as additional information becomes available. While the Company does not anticipate that the amount of any such revisions will have a material adverse effect on the Company's operations or financial condition, the measurement of environmental liabilities is inherently difficult and the possibility remains that technological, regulatory or enforcement developments, the results of environmental studies, or other factors could materially alter this expectation at any time. Such matters could have a material adverse impact on earnings for one or more fiscal quarters or years. From time to time, the Company and certain of its subsidiaries are named as defendants in personal injury and property damage lawsuits, including purported class actions, on the basis of a Company subsidiary's having owned, operated or transported waste to a disposal facility which is alleged to have contaminated the environment or, in certain cases, conducted environmental remediation activities at sites. Some of such lawsuits may seek to have the Company or its subsidiaries pay the costs of groundwater monitoring and health care examinations of allegedly affected persons for a substantial period of time even where no actual damage is proven. While the Company believes it has meritorious defenses to these lawsuits. their ultimate resolution is often substantially uncertain due to the difficulty of determining the cause. extent and impact of alleged contamination (which may have occurred over a long period of time). the potential for successive groups of • complainants to emerge, the diversity of the individual plaintiffs' circumstances, and the potential contribution or indemnification obligations of co-defendants or other third parties. tong other factors. Accordingly, it is 28 Herbert A. Getz, age 40,has been a Senior Vice President of the Company since May 1995, a Vice President of the Company since May 1990 and General Counsel since August 1992. He has also been Secretary of the Company since January 1988. He also served as Assistant General Counsel of the Company from December • 1985 until August 1992. Mr. Getz has also held the offices of Vice President. General Counsel and Secretary at Waste Management from April 1989 until December 1993, and Vice President and Secretary of Rust from January 1993 to May 1994. He has also served as Secretary of WTI since July 1995, a position he previously held..as well as being the General Counsel of WTI, from November 1990 until May 1993. Mr. Getz commenced employment with the Company in 1983. He is Chairman of the Board of Directors of NSC and a director of OHM. Thomas C. Hau, age 60, has been a Vice President and the Controller and Principal Accounting Officer of the Company since he commenced employment with the Company in September 1990. From 1971 until his employment by the Company, Mr. Hau was a partner of Arthur Andersen LLP. William P. Hullfgan. age 52,has been Executive Vice President of Waste Management since January 1996, a position he previously held from September 1984 to January 1988. From 1986 to August 1993, he was also a Vice President of the Company. From August 1992 to March 1996, he also served as President of certain Waste Management operating groups. He was President of Waste Management from January 1988 to August 1992. He has been employed by the Company since 1979. Joseph M. Holsten, age 43, has been Chief Executive Officer of Waste Management International since July 1995. From October 1993 to July 1995, he was Executive Vice President and Chief Financial Officer of Waste Management. Mr. Holsten was Vice President of Acquisitions and Project Development for Waste Management International from April 1992 to August 1993 and Vice President, Chief Financial Officer and Treasurer of Rust from September to October 1993. Mr. Holsten has been employed by the Company since 1981. • James E. Koenig, age 48, has been a Senior Vice President of the Company since May 1992, Treasurer of the Company since 1986 and its Chief Financial Officer since 1989. Mr. Koenig first became a Vice President of the Company in 1986. From 1984 to 1986, Mr. Koenig was Staff Vice President and Assistant to the Chief Financial Officer of the Company. Mr. Koenig has been employed by the Company since 1977. Mr. Koenig also served as Vice President, Chief Financial Officer and Treasurer of WTI from November 1990 to May 1993. He also serves as a director of WTI, Waste Management International and Olaf. D. P. Payne, aee 53. has been a Senior Vice President of the Company since April 1995. a position he previously held from 1990 to 1993. He also served as President and Chief Executive Officer and a director of CWM from September 1991 to March 1995. Mr. Payne has been employed by the Company since 1990. Phillip B. Rooney, age 51, has served as a director of the Company since 1981 and as its President and Chief Operating Officer since November 1984. Since January 1994, he has also served as Chairman of the Board and Chief Executive Officer of Waste Management. fir. Rooney commenced employment with the Company in 1969 and first became an officer of the Company in 1971. Since November 1990, he has served as Chairman of the Board and Chief Executive Officer of W-17I. Mr. Rooney is also a director of Waste Management International, WTI, Illinois Tool Works. Inc.. Caremark International Inc.. Urban Shopping Centers, Inc.. and ServiceMaster :Management Corporation, the general partner of ServiceMaster Limited Partnership. Donald A. Walleren. age 54, has been Vice President and Chief Environmental Officer of the Company since 1992 and Vice President of Environmental Management of Waste Management since January 1995. He was Vice President and Chief Environmental Officer at Waste Management from 1989 to May 1990. From 1990 • to 1992, he served as Vice President-Recycling. Development and Environmental Manaeement of Waste Management. Mr. Wallgien has been employed by the Company since 1979. 30 f ITEJI 6. SELECTED FINANCIAL DATA. The following selected consolidated financial information for each of the live years in the period ended • December 31. 1995 is derived from the Company's Consolidated Financial Statements, which have been audited by Arthur Andersen LLP, independent public accountants, whose report thereon is incorporated by reference in this report. The information below should be read in conjunction with "Management's Discussion and Analysis of Results of Operations and Financial Condition" and the Company's Consolidated Financial Statements, and the related Notes. and the other financial information which are filed as exhibits to this report and incorporated herein by reference. Year Ended December 31. 1991(1) 1992(2) 1993(3)(6( 1994141(6) 1995(51(61 1000's omitted,except per share amounts) Revenue from continuing operations . S 7,550,914 S 8,661.027 S 8,636.116 S 9,554.705 510,247,617 Income from continuing operations . . S 606,323 S 850.036 S 442.431 S 776,491 S 654.590 Earnings per common and common equivalent share—continuing operations . . . . . . . . . . S 1.23 S 1.72 S .91 S 1.60 S 1.35 Total assets . . . . . . . . . . . . . . . . . . . $12.572.310 514,114.180 $16.264,476 517,423.173 518,695.308 Long-term debt, less portion payable within one vear. . . . . . . . . . . . . . . S 3,782.973 S 4.312.511 S 6,145.584 S 6.044,411 S 6,420.610 Dividends per share . . . . . . . . . . . . . S 42 S .50 S .58 S .60 S .60 (1) The results for 1991 include a special charge of 5296,000.000 (before tax and minority interest) primarily to reflect then current estimates of the environmental remediation liabilities at waste disposal sites previously used or operated by the Company and its subsidiaries or their predecessors. (2) The results for 1992 include a non-taxable gain of 5240.000.000 (before minority interest) resulting from • the initial public offering of Waste Management International, special charges of$219,900,000 (before tax and minority interest) primarily related to writedowns of the Company's medical waste business. CNNW incinerators in Chicago, Illinois and Tijuana. Mexico and a former subsidiarv's investment in its asbestos abatement business and certain restructuring costs incurred by the subsidiary and CWhI related to the formation of Rust, and one time after-tax charges aggregating 571.139.000, or 5.14 per share, related to the cumulative effect of adopting two new accounting standards. (3) The results for 1993 include a non-taxable gain of 515.109.000 (before minority interest) relating to the issuance of shares by Rust, as well as the Company's share of a special asset revaluation and restructuring charge of 5550.000.000 (before tax and minonty interest) recorded by CWIM related primarily to a revaluation of CNVNI's thermal treatment business. and a provision of approximately 514.000.000 to adjust deferred income taxes resulting from the 1993 tax law change. See Votes 3 and 14 to the Company's Consolidated Financial Statements. (4) The results for 1994 include a charge of $9.200.000 (before tax and ininority interest) recorded by Rust to write off assets and recoenize costs of exiting certain of Rust's service lines and closing offices in a consolidation of certain of its operating groups. See Vote 1» to the Company's Consolidated Financial Statements. (5) The results for 1995 include a special charge of 5140.600.000 tbefore tax) recorded by CW\I, pnmanly to write eff its investment in facilities and technologies that it abandoned because they do not meet customer service or performance objectives, and a special charge of 5194,600.000 (before tax and minority interest) recorded by R'aste Management International relating :o actions it is taking to sell or otherwise dispose of -.on-erre businesses and investments, as well as core cnsinesses and investments in low potential markets. abandon certain hazardous waste treatment and processing technologies. and streamline its coutim management organization. See Note 14 to the Company's Consolidated Financial Statements. • (6) In December 1995. the Rust Board of Directors approved a pian to sell or otherwise discontinue Rusts process engineering, construction. specialty contractins and similar ;:ties of business. Accordingh'. mese IT'EhI 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. Reference is rnade to the paragraph under the caption "Compensation Committee Interlocks and Insider Participation" on page 16 of the Proxy Statement and the information set forth under the caption "Certain • rransactions" beginning on page 24 of the Proxy Statement for certain information with respect to certain relationships and related transactions, which paragraphs are incorporated herein by reference. PART IV ITEM 14. EXHIBITS. FMANCIAL STATEMENTS, SCHEDULE AND REPORTS ON FORM 8-K. (a) Financial Statements. Schedule and Exhibits. I. Financial Statements—filed as an exhibit hereto and incorporated herein by reference. (i) Consolidated Statements of Income for the three years ended December 31. 1995; (ii) Consolidated Balance Sheets—December 31, 1994 and 1995: (iii) Consolidated Statements of Stockholders' Equity for the three years ended December 31. 1995: (iv) Consolidated Statements of Cash Flows for the three years ended December 31. 1995: (v) Notes to Consolidated Financial Statements: and (vi) Report of Independent Public Accountants. II. Schedule (i) Schedule II—Valuation and Qualifying Accounts (ii) Report of Independent Public Accountants on Schedule All other schedules have been omitted because the required information is not significant or is included • in the financial statements or the notes thereto, or is not applicable. M. Exhibits. The exhibits to this report are listed in the Exhibit Index elsewhere herein. Included in the exhibits listed therein are the following exhibits which constitute management contracts or compensatory plans or arrangements': (i) 1981 Stock Option Plan for Non-Employee Directorsof registrant (Exhibit 19 to registrant's report on Fort 10-Q for the quarter ended June 30. 1982) - ii) 1;VMX Technologies. Inc. 1982 Stock Option Plan. as amended to March 11. 1988 (Exhibit 10.3 to registrant's 1988 annual report on Form iO-K) (iii) Deferred Director's Fee Plan, as amended (Exhibit 10.3 to registrant's 1990 annual report on Form l0-K) (iv) Director's Phantom Stock Plan (Exhibit 10.9 to registrant's 1984 annual report on Form l0-K) (v) Emplovment Agreement. dated as of September 1. 1986, by and between the registrant and Phillic B. Roonec (Exhibit 19.4 to regrstranc s report on Form 12-Q for the cuarter ended Septec,ber 30. 1986) (vi) WMX TechnOIO2leS. Inc. Corporate Incentive Bonus Plan (Exhibit B to regisvant's Proxy Statement for its 1995 Annual Meeting of Stockholders) (vii( %VNIX Technologies. Inc. Supplemental Executive Retirement Plan. as amended and restated as of January 25. 1995 (filed with this reporn • - 34 i (xxvu, Amendment dated as of December 6. 1991 to the N%M 1986 Stock Plan (Exhibit 19,01 to the 1991 annual report cn Form 10-K of Wheelabrator Technologies Incl (xxviii( Amendment dated as of December 6. 1991 to the WTI 1988 Stock Plan (Exhibit 19.0_ to the • 1991 annual report cn Form 10-K of Wheelabrator Technologies Inc.) (xxix) Amendment dated as of December 6. 1991 to the Restricted Unit Plan for Non-Emplovee Directors of Wheelabrator Technologies Inc. (Exhibit 19.05 to the 1991 annual reporton Form 10-K of Wheelabrator Technologies Inc.l (xxx( WMX Technologies. Inc. Long Term Incentive Plan (as amended and restated as of January 27, 1994) (Exhibit A to registrant's Proxy Statement for its 1995 Annual Meeting of Stockholders) 'In the case of reference to documents filed under the Securities Exchange Act of 1934, the registrant's file number under that Act is 1-7327, Chemical Waste Management's file number under that Act was 1-9253 and Wheelabrator Technologies Inc.'s file number under that Act is 0-14246. (b) Reports on Form 8-K. During the fourth quarter of 1995, the Company filed reports on Form 8-K as follows: (i) a report dated October 17, 1995 reporting under Item 5 the issuance of a news release concerning the Company's 1995 third quarter results of operations and a possible 1995 fourth quarter charge %, Waste Management International; and (ii) a report dated December i 2. 1995 reporting under Item 5 the issuance of news releases cenceming (A) the authorization by the Company's Board of Directors of a Company common stock repurchase program. (B) an increase by WTI in its program for the repurchase of VbTI common stock, (C)'a fourth quarter 1995 exceptional charge by Waste Management International. (D) the decision by Rust to sell or otherwise discontinue its process engineering, construction, soecialty contracting and similar Hues of • business and the possibility of a related 1995 fourth quarter charge. (E) announcement of below- expectations 1995 fourth quarter earnings by Waste Management International. and (F) expected 1996 earnings growth by Waste !Management International. 36 s REPORT OF LNDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULE To 1;VMX Technologies. Inc.: • We have audited in accordance ,�uh generally accepted auditing standards. the consolidated financial statements included in the W\LX Technoiogies. Inc. Annual Report to Stockholders for 1995 filed as an exhibit to and incorporated by reference in this Form 10-K, and have issued our report thereon dated February 5. 1996. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedule included on page 37 of this Form 10-K is the responsibility of the Company's management and is presented for purposes of complying with the Securities and Exchange Commissions rules and is not a part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and. in our opinion. fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole. /S/ ARTHUR ANMERSE\ LLP ARTHUR ANDERSEN LLP Chicago. Illinois, February 5, 1996 • .S SECURMES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (MARK ONE) QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 19% TRANSITION REPORT PURSUANTTO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO Commission file number 1.7327 WMX TECHNOWGIES, INC. (Fact name of Reptnnt m specified in its charter) • Delaware 36-2660763 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 3003 Butterfield Road, Oak Brook, Illinois 60521 (Addtcss of principal executive offim) (Zip Code) Registrant's telephone number, including area code: (630) 572-8800 Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15 i d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes C No Shares of Registrant's Common Stock, $1 par Value, issued and outstanding at July 31, 19% — 491,074A22 WMX TECI-P1i OLOGIES, INC. .-k-ND SUBSIDIARIES INDEY PAGE PART I. Financial Information: Consolidated balance sheets as of December 31, 1995, and June 30, 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Consolidated statements of income for the three months and six months ended June 30, 1995 and 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Consolidated statements of stockholders'. equity for the six months ended June 30, 1995 and 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Consolidated statements of cash flows for the six months ended June 30, 1995 and 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Notes to consolidated financial statements . . . . . . . . . . . . . . . . . . . . . . . 9 Management's discussion and analysis of results of operations and financial condition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 PART H. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 ataau 2 PART I. FINANCIAL INFORMATION • „ WMX TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) ($000's omitted) ASSETS December 31 loos June 30, 1 CURRENT ASSETS: Cash and cash equivalents $ 189,031 Short-term investments 36,243 $ 266,43 Accounts receivable, lees reserve of $66,840 in 1995 25,87 and $60,563 in 1996 1,880,934 Employee receivables 1,937,39 Parts and supplies 8.787 10,21 Costs and estimated earnings in excess of billings 210,864 204,55 on uncompleted contracts 334,786 Prepaid expenses 368,6 360.404 _ 376.48 Total Current Assets 5 3.021,049 S 3.189. 1__2 PROPERTY AND EQUIPMENT, at cost: Land, primarily disposal sites $ 4,575,117 Buil 4 $ 4,816,18 • vehicles and equipment 1498,718 1,542,10 7, 7,795,26 Leasehold improvements 87 986 7,795,26 91. 1^ $13,734,642 $14,244,71 Less - Accumulated depreciation and amortization r3,958.94j) r4,315.80 Total Property and Equipment, Net S 9.765.699 S 9.928.9 OTHER ASSETS: Intangible assets relating to acquired businesses, net $ 4,205,031 Sundry, including other investments $ 4,566, 15 Net assets of discontinued operations 1'572,977 1,619, 63 130. _52 Total Other Assets 5 5,908 550 5 6.185 8c Total Assets $18.695.308 �.� $19,303.83 The accompanying notes are an integral part of these balance sheets. • 3 CONSOLIDATED BALANCE SHEETS (Unaudited) ($000's omitted except per share amounts) LIABILITIES AND STOCKHOLDERS' EQUITY December 31, 1995 June 30, :995 CURRENT LIABILITIES: Portion of long-term debt payable within one year $ 1,094,165 $ 901,510 Accounts payable 1,072,372 966,265 Accrued expenses 991,539 940,943 Unearned revenue 263,029 271,338 Total Current Liabilities S 3,421,105 S 3,080,C56 DEFERRED ITEMS: Income taxes $ 956,525 S 1,070,774 Environmental liabilities 622,952 590,403 Other 684,452 660,794 Total Deferred Items S 2,263,929 S 2,321.931 LONG-TERM DEBT, less portion payable within one year S 6,420,610 S 7 , 123.C55 MINORITY INTEREST IN SUBSIDIARIES S 1,385,366 S 1,190, 173 COMMITMENTS AND CONTINGENCIES S S PUT OPTIONS S 261,959 S 397,916 STOCKHOLDERS' EQUITY: —. Preferred stock, $1 par value (issuable in aeries) ; 50,000,000 shares authorized; none outstanding during the periods S - $ - Common stock, $1 par value; 1,500,000,000 shares authorized; 498,817,093 shares issued in 1995 and 507,097,590 in 1996 498,817 507,C" Additional paid-in capital 422,801 565,859 Cumulative translation adjustment (102,943) (108,530) Retained earrings 4,486,877 4,738,419 S 5,305, 552 $ 5,702,S42 Leas: Treasury stock; 4,357,693 shares, at cost - 145,279 1988 Employee Stock Ownership Plan 13,062 9,7L9 Employee Stock Benefit Trust (11,769,788 shares in 1995 and 10,886, 361 shares in 1996, at market) 350,151 356. 523 Total Stockholders' Equity S 4,942,339 S 5. 19017^_5 Total Liabilities and Stockholders' Equity $18,695,308 $19, 303 ,8837 The accompanying notes are an integral part of these balance sheets. 4 WMX -ECHNOLOGIES, INC. AND SUBSIDIARIES CCNSOLIDATED STATEMENTS OF' INCOME . FOR THE THREE MONTHS AND SIX MONTHS ENDED JUNE 30 • (Unaudited) (000's omitted except per share amounts) Three Months Six Months Ended June 30 Ended .:une 30 1995 199§_ 1995 1996 REVENUE 52.635.665 $2.618,12555.080.850 $5,035,316 Operating expenses $1,817,192 $1,815,274 $3,501, 142 $3,495,197 Special chargee - - 140,600 - Goodwill amortization 29, 544 32,806 59,054 64,370 Selling and administrative expenses 300,322 289,268 587,852 576,154 Interest expense 111,847 99 ,603 218,370 198,918 Interest income (14,463) (6,857) (23, 349) (13,699) Minority interest 40, 117 32:,179 69,431 60,254 Sundry income, net (13 ,343) (21.1409) (30.264) !38.768) • Income from continuing operations before income taxes $ 364,449 S 377,261 S 558,014 S 692,890 Provision for income taxes 151.987 1541 244.260 284.670 Income from continuing operations $ 212,462 $ 2211,042 $ 313,754 $ 408,220 Income from operations of discontinued businesses, less applicable income taxes and minority interest of $6,382 and $6,474 for the three months and six months ended June 30, 1995, respectively 6. 665 6. 618 NET INCOME $ 219 . 127 $ 22:1,042 S 320. 372 $ 408,220 AVERAGE COMMON AND COMMON EQUIVALENT SHARES OUTSTANDING 485 ,082 49(iy31 484. 968 492,593 EARNINGS PER COMMON AND COMMON EQUIVALENT SHARE Continuing operations S 0.44 $ 0.45 $ 0.65 S 0.83 Discontinued operations 0.01 0.01 NET INCOME S 0.45 S 0� .45 S 0.66 $ 0.83 DIVIDENDS DECLARED PER SHARE S 0.15 S 0.15 S 0.30 S 0.31 • The accompanying notes are an integral part of these statements. 5 WMX TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY FOR THE SIX MONTHS ENDED JUNE 30, 1995 (Unaudited) ($000's omitted except per share amounts) 1988 Employee Additional Cumulative Stock Employee Common Paid-In Translation Retained Treasury Ownership Stock Stock Capital Adiustment Earnings Stock Plan Benefit Trust Balance, January 1, 1995 $496,387 $357,150 $(150,832) $4,181,606 $ - $19,729 $323,601 Net income for the period - - - 320,372 - - - Cash dividends ($.30 per share) - - - (145,376) - - - Dividends paid to Employee Stock Benefit Trust - 3,643 - (3,643) - - - stock issued upon exercise of stock options 16 (1,959) - - (329) - (7,801) Treasury stock received in connection with exercise of stock options - - - - 329 - - Tax benefit of non-qualified stock options exercised - 895 - - - - - contribution to 1988 Employee Stock Ownership Plan - - - - - (3,334) - Common stock issued upon conversion of Liquid Yield Option Notos 120 1,929 - - - - - common stock issued for acquisitions 370 10,206 - - - - - Temporary equity related to put options - 11, 133 - - - - - Proceeds from sale of put options - 6,766 - - - - - Settlement of expired put options - (12,019) - - - - - Adjustment of Employee Stock Benefit Trust to market value - 27,389 - - - - 27,389 Transfer of equity interests among controlled subsidiaries - 598 - - - - - cumulative translation adjust- ment of foreign currency statements - - 55,825 - - - - Balance, June 30, 199549� 6,901 S405,731 $ 195.007) $4,352,959 S� 1$ 6,395 $343, 189 The accompanying notes are an integral part of this statement. WMX TECHNOLOGIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY FOR THE SIX MONTHS ENDED JUNE 30, 1996 1 _ (Unaudited) ($000's omitted except per share amounts) 1988 Employee Additional Cumulative Stock Employee Common Paid-In Translation Retained Treasury Ownership Stock Stock Capital Adiustment Earnings Stock Plan Benefit Trust Balance, January 1, 1996 $498,817 $422,801 $(102,943) $4,486,877 $ - $13,062 $350,151 Net income for the period - - - 408,220 - - - Cash dividends ($.31 per share) - - - (153,222) - - - Dividends paid to Employee Stock Benefit Trust - 3,460 - (3,460) - - - stock repurchase (5,000,000 shares) - - - - 168,305 - - Stock issued upon exercise of stock options 217 (7,332) - - (25,617) - (28,622) Treasury stock received In connection with exercise of stock options - - - _ 791 Tax benefit of non-qualified stock options exercised - 4,999 - - - - - Contribution to 1988 Employee Stock Ownership Plan - - - - - (3,333) - Treasury stock received as settlement for claims - - - - 2,400 - - Common stock issued upon conversion of Liquid Yield Option Notes 107 1,893 - - - - - Common stock issued for acquisitions 7,957 226,222 - - - - - Temporary equity related to put options - (135,957) - - - - - Proceeds from sale of put options - 14,774 - - - - - Adjustment of Employee Stock Benefit Trust to market value - 34,999 - - - - 34,999 Cumulative translation adjust- ment of foreign currency statements - - 15.587) - - - - Balance, June 30, 1996 5507,098 $565,859 51108,530) 54,738,415 $145,879 S 9,729 $356,528 The accompanying notes are an integral part of this statement. FOR THE SIX MONTHS ENDED JUNE 30 Increase (Decrease) in Cash (Unaudited) ($000'8 omitted) Cash flows from operating activities: 1995 1996 Net income for the period $ 320,372 $ 408,220 Adivatmenta to reconcile net income o net cash provided by operating activities: Depreciation and amortization 433,624 462,170 Provision for deferred income taxes 113,418 116,725 Minority interest in subsidiaries 70,939 60,254 Interest on Liquid Yield Option Notes (LYONS) and WMX Subordinated Notes 17,365 5,737 Contribution to 1988 Employee Stock OwnershipPlan 3,334 3,333 Special charge, net of tax 91,400 _ Changes in assets and liabilities, excluding effects of acquired companies: Receivables, net (5,852) (30,391) Other current assets (59,401) (43,8641 Sundry other assets 48,770 (16,939) Accounts payable (43,910) (114,635) Accrued expenses and unearned revenue 38,699 ) Deferred items (33,227] (55,029) Other, net !10.498) 738 Net cash provided by operating activities S 907.635 S 727.870 Cash flows from investing activities: Short-term investments Capital expenditures $ (584,988) $ 10,371 Proceeds from sale of assets and businesses 131,853) (577'791. Coat of acquisitions, 146,901 quiaitiona, net of cash acquired (119,648) 57,911 Other investments (54,123 145,232 Acquisition of minority interests (26.799 Net cash used for investing activities S (719.552) L_115 3,�U 5, Cash flows from financing activities: Cash dividends S (145,376) $ (153,w.22 Proceeds from issuance of indebtedness 1, 128,278 1,366,124 Repayments of indebtedness (1, 140,402) (906,535 Proceeds from exercise of stock options, net 5,858 46,333 , Contributions from minority interests 13348 3,680 Stock repurchases - (168,305 Proceeds from sale of put options 6 766 14,774 Settlement of put options ( 12.019) Net cash provided by (used for) financing activities S ( 143.547) S 202.349 Net increase in cash and cash equivalents $ 44,536 Cash and cash equivalents at beginning of period 63884 $$ 13 Cash and cash equivalents at end of period 5 The Company considers cash and cash equivalents to include currency on hand, demand deposits with banks and short-term investments with maturities of Less than three months when purchased. Supplemental disclosure of cash flow information: Cash paid during the period for: Interest, net of amounts capitalized $ 202,722 $ 193,181 Income taxes, net of refunds received $ 144,377 $ 147,372 Supplemental schedule of noncash investing and financing activities: LYONS converted into common stock of the Company $ 2,049 S 2,OCC Liabilities assumed in acquisitions of businesses $ 107,740 $ 97,952 Fair market value of Company stock issued for acquired businesses S 10,584 $ 234, 175 WMX Subordinated Notes issued for acquisition of CWM minority interest S 436,830 $ _ The accompanying notes are an integral part of these statements. 8 • WMX TECHNOLOGIES, INC. AND SUBSIDIARIES �. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) ($000's omitted in all tables) The financial statements included herein have been prepared by WMX Technologies, Inc. ("WMX" or the "Company") without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. The financial information included herein reflects, in the opinion of the Company, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position and results of operations for the periods presented. The results for interim periods are not necessarily indicative of results for the entire year. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, income and expenses and disclosures of contingencies. Future events could alter such estimates in the near term. Certain amounts in previously issued financial statements have been restated to conform to 1996 classifications. • Income Taxes - The following table sets forth the provision for income taxes for continuing operations for the three months and six months ended June 30, 1995 and 1996: Three Months Six Months Ended June 30 Ended June 30 $ 69,859 1996- 1995 Currently payable 1995 $102,940 $129,880 96 Deferred 82,399 51,473 $168,333 Amortization of deferred 114,922 116,725 investment credit (271) _(94) (542) 1388) $151,9875154,219 244.260 $284,670 Business Combinations - During 1995, the Company and its principal subsidiaries acquired 136 businesses for $224,304,000 in cash (net of cash acquired) and notes, $77,689,000 of debt assumed, and 2,236,354 shares of the Company's common stock. Three of the aforementioned 1995 acquisitions, which otherwise met pooling of interests criteria, were not significant in the aggregate and, consequently, prior period financial statements were not restated. The remaining acquisitions were accounted for as purchases. In January 1995, the Company acquired all of t!!1e approximately 21.44 of the outstanding shares of Chemical Waste Managment, Inc. ("CWM" ) that it did not already own, for $436.8 million of convertible subordinated notes. In July 1995, the Company acquired all of the approximately 3 . 1 million shares of Rust International Inc. ( "Rust") held by the public, for 516.35 per share in cash. • 9 During the six months ended June 30,1996, the Company and its . principal subsidiaries acquired 67 businesses for $57,911,000 in cash (net of cash acquired) and notes, $34,885,000 of debt assumed, and 7,956,606 shares of the Company's common stock. These acquisitions were accounted for as purchases. The 'pro forma effect of the acquisitions made during 1995 and 1996 is not material. Discontinued Operations In the fourth quarter of 1995, the Rust Board of Directors approved a plan to sell or otherwise discontinue Rust'a process engineering, construction, specialty contracting and similar lines of business and have Rust focus on its environmental and infrastructure consulting businesses. During the second quarter of 1996, the sale of the industrial process engineering and construction business, based in Birmingham, Alabama, was completed. Rust is currently negotiating the sales of certain other businesses, the remaining assets of which are not material to the consolidated balance sheet. The results of these transactions, which are expected to be completed by the end of 1996, will not have a material impact on the consolidated statement of income. Revenue from the discontinued businesses (through the date of sale for units sold) was $67.0 million for the three months and $209.8 million for the six months ended June 30, 1996, compared with $220.4 million for the three-month and $380.1 million for the six-month periods in 1995. Results of operations for the three months and six months ended June 30, 1996, were not material and were included in the reserve for loss on disposition provided previously. Accounting Principles - Effective January 1, 1996, the Company adopted Statement of Financial Accounting Standards ("FAS") No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of. " The change did not have a material impact on the Company's financial statements. In October 1995, the Financial Accounting Standards Board issued FAS No. 123, "Accounting for Stock-Based Compensation," which the Company also must adopt in 1996. FAS 123 provides an optional new method of accounting for employee stock options and expands required disclosure about stock options. If the new method of accounting is not adopted, the Company will be required to disclose pro forma net income and earnings per share as if it were. The Company is studying FAS No. 123 and is gathering data necessary to calculate compensation in accordance with its provisions, but has not decided whether to adopt the new method or quantified its impact on the financial statements. Derivative Financial Instruments From time to time, the Company uses derivatives to manage interest rate, currency and commodity risk. Neither the amount of such instruments outstanding at any point in time nor gains or losses from their use has been material to the Company's financial statements. Interest Rat• Agreements Certain of the Company's subsidiaries have entered into interest rate swap agreements to balance fixed and floating rate debt in accordance with management's criteria. The agreements are contracts to exchange fixed and floating interest rate payments periodically over the term without the exchange of the underlying notional amounts. The agreements provide only for the exchange of interest on the notional amounts at the stated rates, with no multipliers or leverage. Differences paid or received are recognized as a part of interest expense on the underlying debt over the life of the agreements. 10 • Currency Agreements From time to time, the Company and certain of its subsidiaries use foreign currency derivatives to mitigate the impact of translation on foreign earnings and income from foreign investees. Typically these have taken the form of purchased put options or offsetting put and call options with different strike prices. The Company receives or pays, based on the notional amount of the option, the difference between the average exchange rate of the hedged currency against the base currency and the average (strike price) contained in the option. Complex instruments involving multipliers or leverage are not used. Although the purpose for using such derivatives is to mitigate currency risk, they do not qualify for hedge accounting under generally accepted accounting principles and accordingly, must be adjusted to market value at the end of each accounting period. Commodity Agreements 'he Company utilizes collars, calls and swaps to mitigate the risk of price fluctuations on the fuel used by its vehicles. Quantities hedged equate to committed fuel purchases or anticipated usage and accordingly, gains and losses are deferred and recognized as fuel is purchased. The Company is exposed to credit lose in the event of non-performance by counterparties on interest rate, currency and commodity derivatives, but in all cases such counterparties are highly rated financial institutions and the Company does not anticipate non-performance. Maximum credit exposure is represented by the fair value of contracts with a positive fair value at June 30, 1996, which is not material. Environmental Liabilities - The majority of the businesses in which the Company is engaged are intrinsically connected with the protection of the environment. As much, a significant portion Of the Company's operating costs and capital expenditures could be characterized as costs of environmental protection. while the Company is faced, in the normal • course of business, with the reed to expend funds for environmental protection and remediation, it does not expect such expenditures to have a material adverse effect on its financial condition or results of operations because its business Is based upon compliance with environmental laws and regulations and its services are priced accordingly. Such costs may increase in the future as a result of legislation or regulation; however, the Company believes that in general it benefits from increased government regulation, which increases the demand for its services, and that it has the resources and experience to manage environmental risk. As part of its ongoing operations, the Company provides for estimated closure and Post-closure monitoring costs over the operating life of disposal sites as airspace is consumed. The Company has also established procedures to evaluate its potential remedial liabilities at closed sites which it owns or operated, or to which it transported waste, including 107 sites listed on the Superfund National Priority List ("NPL") . The majority of the situations involving NPL sites relate to allegations that subsidiaries of the Company (or their predecessors) transported waste to the facilities in question, often prior to the acquisition of such subsidiaries by the Company. Where the Company concludes that it is probable that a liability has been incurred, provision Is made in the financial statements. Estimates of the extent of the Company's degree of responsibility for remediation of a particular site and the method and ultimate cost of remediation require a number of assumptions and are - difficult, and the ultimate outcome may differ from current estimates. However, the Company believes that its extensive experience in the environmental services business, as well as its involvement with a large number of sites, provides a reasonable basis for estimating its aggregate liability. As additional information becomes available, estimates are adjusted as necessary. While the Company does not anticipate that any such adjustment would be caterial to its financial statements, it is reasonably • possible that technological, regulatory or enforcement developments, the results of environmental studies or other factors could', necessitate the recording of additional liabilities which could be material. 11 a.:1 r_..rc::.r _.urage _a:suits, _nciuc_n g rurported class acticns, on t.e basis of a Company subsidiary' s having owned, operated or transported waste t a disposal facility which is alleged to have contaminated the environepent. while the Company believes it has meritorious defenses to these lawsuits, their ultimate resolution is often substantially uncertain due to a number of factors, and it is possible such matters could have a material adverse impact on the oCompany's earnings for one or more quarters or years. Stockholders' Equity - The Boards of Directors of WMX and W-.: have authorized their respective companies to repurchase shares of their own common stock (up to 25 million shares in the case of WMX and 20 million shares in the case of WTI) in the open market or in privately negotiated transactions. These programs extend into 1997. wTI has repurchased 19.2 million shares under its program, including 15.4 million in the second quarter and 18.4 million shares during the first six months of 1996. "NX has repurchased 5.0 million shares, all during the second quarter of 1996. In conjunction with its authorized repurchase program, WMX periodically sells put options on its common stock. The put options give the holders the right at maturity to require the Company to repurchase its shares at specified prices. Proceeds from the sale of the options are credited to additional paid-in capital. In the event the options are exercised, the Company may elect to pay the holder in cash the difference between the strike price and the market price of the company's shares in lieu of repurchasing the stock. At June 30, 1996, put options were outstanding for 12.5 million shares, 4.7 million of which subsequently expired unexercised as the price of the Company's stock was in excess of the strike price at maturity. The remaining options expire in October and November of 1996 with strike prices of $33.45 to $35.17 per share. Commitments and Contingencies - waste Management International plc ("WH International") has received an assessment of approximately 417 million Krona (approximately $63 million) from the Swedish Tax Authority, relating to a transaction completed in 1990. WH International believes that all appropriate tax returns and disclosures were filed at the time of the transaction and intends to vigorously contest the assessment. A subsidiary of WHI has been involved in litigation challenging a municipal zoning ordinance which restricted the height of its New Milford, Connecticut landfill to a level below that allowed by the permit previously issued by the Connecticut Department of Environmental Protection ("DEP") . WHI is presently under an order of the Superior Court to apply to the DEP for permission to remove all waste above the height allowed by the zoning ordinance. The Company believes that the removal of such waste is an inappropriate remedy and has appealed the Superior Court order to the state Supreme Court. The Company is unable to predict the outcome of this appeal or the nature and extent of any removal action that may ultimately be required. However, if the Superior Court order is not modified, the subsidiary could incur substantial costs, which could vary significantly depending upon the nature of any plan eventually approved by the applicable regulatory authorities, the actual volume of waste to be moved, and other factors, and which could have a material adverse effect on the Company' s financial condition and results of operations in the near term. In July 1996, a Federal District Court permanently enjoined the State of New Jersey from enforcing its solid waste regulatory flow control system, which was held to be unconstitutional. Flow control typically involves a governmental authority specifying the disposal site for all solid waste generated within its borders. The New Jersey ruling is one of a number of similar court rulings since a 1994 U.S. Supreme Court decision that state and local governments may not constitutionally restrict the free movement of trash in interstate commerce through the use of flow control laws. Other subsequent court decisions have upheld nonregulatory means by which municipalities may effectively control the flow of solid waste. Federal legislation has been proposed, but not enacted, to essentially grandfather existing flow control mandates. 12 • wTI'g Gloucester County, New Jersey, trash-to-energy facility relies cn a disposal franchise for substantially all of its supply of municipal.solid waste. rrling ie o The Federal District Court stayed its injunction for as long as its n the to devise an appeal, plus an additional period of two years, to enable thSt • alternative nondiscriminatory approach. The Company believes that the State is considering an appeal of the District Court decision. To date, court decisions with regard to flow control have not had a material adverse effect on the Company' s operations. However, given the surrounding uncertainty, it is not possible to predict what impact, if any, this matter may have in the future on the Company's disposal facilities, particularly WTI's trash-to-energy facilities. In the ordinary course of conducting its business, the Company becomes involved in lawsuits, administrative proceedings and, governmental investigations, including antitrust and environmental matters. Some of these proceedings may result in fines, penalties or judgments being assessed against the Company which, from time to time, may have an impact on earnings for a particular quarter or year. The Company does not believe that these proceedings, individually or in the aggregate, will have a material adverse effect on its sults of operations or financial condition. re Debt - In May 1996, the Company issued $200,000,000 of 6.7% Notes due may , a price of 99.828%. In June 1996, the Company, at issued $200,000,000 of 7 1, 2001at Notes due June 15, 2001, at a price of 99.875%. Neither of these issues is redeemable prior to maturity. In July 1996, the Company issued $450,000,000 of: 7.1% Notes due August 1, 2026, at a price of 99.945%. These rotes are not callable and include a put option on August 1, 2003. Legal Hatters - • See Part II of this Form 10-Q for a discussion of legal matters. • 13 ur :vSOLTS Da Ue! irATIONS AND FINANCIAL CONDITION ($000' s cmitted in all tables) RESULTS OF OPERATIONS: Consolidated - For the three months ended June 30, 1996, WMX Technologies, Inc. and its subsidiaries ('WMX' or the 'Company' )had net income from continuing operations of $223.0 million or $.45 per share, compared with $212.5 million or $.44 per share in the same period in 1995. Net income was $.45 per share for both quarters. Second quarter 1995 income from continuing operations and net income included a charge of approximately $.01 per share for the write-off of deferred costs related to debt securities previously issued by the Company and its Chemical Waste Management, Inc. ('CWM' ) subsidiary that were put to the Company by the debtholders prior to maturity. Revenue for the 1996 quarter was $2.62 billion versus $2.64 billion (restated to eliminate discontinued operations) in the year-earlier period. For the six months ended June 30, 1996, income from continuing operations was $408.2 million or $.83 per share, versus $313.8 million or $.65 per share for the corresponding period in 1995. The 1995 results included a CWH charge related to a revaluation of investments in certain hazardous waste treatment and processing technologies and facilities, which reduced consolidated earnings in the first quarter by S•19 per share. Excluding that charge and the charge related to debt securities discussed above, earnings per share from continuing operations for the six months ended June 30, 1995, were $.85. Net income was $.83 for the six months of 1996 compared with S.66 (S.86 excluding the charges discussed above) for the first six months of 1995. Revenue for the periods was $5.04 billion in 1996 and $5.08 billion in 1995. The Company provides environmental services internationally through five principal operating subsidiaries: Waste Management, Inc. (a WHI' ) , CWM, Wheelabrator Technologies Inc. ('WTI' ) , Waste Management International plc (OWN- International' ) and Rust International Inc. ('Rust' ) . However, operations are managed on the basis of four global lines of business - waste services, clean energy, clean water, and environmental and infrastructure consulting. Revenue, operating expenses (excluding special charges) , selling and administrative expenses, and operating margins for the continuing businesses are set forth by business line in the tables below: Waste clean Clean r Consoli- Services Enercv Water Consulti. Eliminations dated Three Months Ended lune 30 1996 - Revenue $2,204,738 $215, 583 $162,960 $123,233 $(88,389) $2,618,125 Operating expenses 1,571,011 137,094 128,980 99,384 (88,389) 1,848,080 Selling and admin. expenses 241,439 9, 125 22,605 16,099 - 289,268 Margin S 392 ,258 5 69, 364 S 11,375 S 7,750 S S 480,777 1995 - Revenue $2,217,204 $221, 062 $164,213 $117, 146 $(83,960) $2,635,665 Operating expenses 1, 564,937 143, 703 129,167 91,689 (82,760) 1,846,736 Selling and admin. expenses _ 248,476 10,933 22,811 18, 102 300,322 Margin S 403, 791 5 66, 426 S 12,235 5 7,355 ( 1,200) 5 488,607 14 Waste Clean Clean Cons oli- • Services Enerav Water Consu ::ng Eliminations dae Six Months Ended June 30 1996 - Revenue $4,242,252 $418,845 $313,220 5233,337 $(172,338) $5,035,316 operating expenses 3,024,995 269,663 247,878 189, 369 (172,338) 3,559,567 Selling and admin. expenses 478.996 19.825 45.193 32. 140 - 576. 154 Margin S 738.261 $129,357 S 20,149 S 11. 828 S - i-899, 595 � 1995_ Revenue $4,249,829 $472,294 $301,248 $225,548 $(168,069) $5,080,850 Operating expenses 2,998,149 313,592 239,140 176,184 (166,869) 3,560,196 Selling and admin. expenses 485.811 21,970 44,393 35.678 - 587.852 Margin S 765.869 S136,732 S 17.715 S 13.686 S (1,200) S 91802 Waste Services - Operating results for the three months and six months ended June 30 were as follows: Three Months _ Six Months 1996 1995 1996 1995 Operating Revenue $2,204,738 $2,217,204 $4,242,252 $4,249,829 • expenses 1,571,011 1,564,937 3,024,995 2,998,149 Selling and admin. expenses 241,439 248.476 478.996 485 811 Margin S 392.288 S 403.791 S 738.261 S 765,869 Revenue by source for the three months and six months ended June 30 is shown in the following table: Three Months Six Months Percentage Percentage North America 1996 1995 Incr!(Decrl 1996 1995 IDe ncr/( Crl Residential $ 319,418 $ 304,307 5.01 $ 631,835 $ 597,394 5.8% Commercial 419, 188 408,089 2. 7 824,232 802,400 2.7 Rolloff and industrial 360,002 343,299 4.9 675,849 648,382 4.2 Disposal, transfer and other* 528,008 549, 194 (3.9) 984,665 988,957 (0.4) Industrial services 113,686 150, 148(24.3) 221,417 321,309 (31.1) International 464.436 462.167 0.5 904.254 891.387 1.4 Total $2,204,738 $2,217,204 (0. 6)8 514,242,252 $4,249.829 (0.2)% -Includes hazardous waste revenue of $117, 754 and $252,938, respectively, for the three month and six month periods of 1596 and $161,455 and 5291 ,936 for the comparable 1995 periods. • 15 North American solid waste revenue grew 3.81 for the second quarter of 1996 compared to the second quarter of 1995, and 4.31 for the 1996 six months compared to the same period in 1995. Revenue growth was inhibited by a substantial decline in prices for recyclable commodities in 1996; average pricing over the �Eirst six months of 1996 was less than 459 of 1995 levels and for the second quarter declined from $160 per ton in 1995 to $54 per ton in 1996. The Company has responded by reducing its processing of lower grades of paper, adjusting the capacity of its recycling operations, and continually striving to reduce processing costs and improve the marketing of commodities. Despite these efforts, the Company has been unable to replace the profits associated with the stronger commodity market in 1995. Price increases in solid waste collection and disposal provided North American revenue growth of approximately 2% for the quarter, but this was offset by reduced commodity prices that negatively impacted revenue by 2 to 2.51. Volume caused revenue growth of 2 to 2.51 in the quarter and acquisitions 1.5 to 21. For the six months, revenue growth was driven by volume (2 to 2.55) and acquisitions (1.5 to 21) . Pricing was essentially flat as recyclable commodity price declines offset price increases in collection and disposal. Industrial services revenue in 1995 included the Rust environmental remediation business, which was exchanged in May 1995, for an approximately 371 equity interest in OHM Corporation. The remediation business had 1995 revenue of $22.0 million in the second quarter and $62.2 million for the year-ago period through the date of its sale. International waste services revenue increased 0.51 in the second quarter of 1996 and 1.41 for the six months compared with the same periods in 1995. Revenue growth in approximately equal proportions from price increases and acquisitions was largely offset by volume declines slightly in excess of 31, primarily in France, Germany, Italy, the Netherlands and Hong Kong. International operations were also negatively impacted by lower commodity prices, although to a lesser extent than in North America because of higher disposal fees and taxes in Europe. The impact of currency translation was relatively insignificant for both the quarter and the six months. Operating expenses were 71.31 of revenue for the 1996 quarter compared with 70.61 for the second quarter of 1995, and 71.41 for the first quarter of 1996. Depressed commodity prices, higher fuel costs, low margin construction revenue on the West Kowloon transfer station in Hong Kong, and volume declines in Europe more than offset the benefits of continued productivity improvements and caused the increase in the 1996 second quarter compared to the same 1995 period. Sequentially, operating expenses declined slightly, primarily a result of improved weather. Selling and administrative expenses declined from 11.21 of revenue in the second quarter of 1995 and 11.61 in the first quarter of 1996 to 11.01 in the quarter ended June 30, 1996. The improvement resulted from a streamlining of the international organization and continuing productivity enhancements on a global basis. Clean Energy - Operating results for the three months and six months ended June 30 were as follows: Three Months Six Months 1996 1995 1996 1995 Revenue $215,583 $221,062 $418,845 $472,294 Operating expenses 137,094 143,703 269, 663 313,592 Selling and admin. expenses 9, 125 10,933 19,825 21,970 margin $ 69, 364 $ 66,426 $129, 357 $136,732 16 Revenue declined to $215.6 million in the second quarter of 1996, from $221.1 • million in the second quarter of 1995. Revenue growth from the Lisbon, Connecticut, waste-to-energy plant, which-began commercial operations in January f996, an industrial cogeneration facility acquired in Martell, California, and increased electric purchases by the utility customer of the Company' s California independent power facilities was more than offset by the absence of construction revenue from the Lisbon facility, which contributed $8.6 million in the second quarter of 1995, and a continuing revenue decline in the clean air business, which is included in this segment. Air business revenue declined 19% compared with the second quarter of 1995, reflecting continuing industry-wide weakness in the face of regulatory uncertainties. For the Six months, segment revenue declined $53.5 million to $418.8 million, due to the foregoing factcrs as well as lower spot pricing for trash disposal in the first quarter of 1996 in areas of Florida. Operating expenses were 63.6% of revenue for the three months ended June 30, 1996, compared with 65.0% of revenue during the June 30, 1995 quarter. This improvement resulted primarily from the absence of construction revenue on the Lisbon facility, which had no associated margin. Selling and administrative expenses declined to 4.2% of 1996 second quarter :revenue from 5.0% of revenue in the comparable quarter of 1995. Improved air business results and lower energy development expense were responsible for the improvement. For the six months ended June 30, operating expenses were 64.4% of revenue in 1996 and 66.4% of revenue in 1995, while selling and administrative expenses were 4.7% of revenue in 1996 compared with 4.6% in 1995. The lower operating expense percentage was again largely the result of the absence of no-margin Lisbon construction revenue. Clean water - Operating results for the three months and six months ended June 30 were as follows: • Three Months S x Months 1996 1995 1996 95 Revenue $162,960 $164,213 $313,220 Operating expenses 128,980 129,167 247,878 $301,248 Selling and 239,140 admin. expenses 22.605 22.811 45.193 44. 93 Margin S 11,375 S 12,23S S 20,149 S 17,715 Second quarter 1996 revenue of $163.0 million was down slightly from the $164.2 million in the second quarter of 1995, as lower revenue from North American and European water process businesses more than offset growth from acquisitions made during the past twelve months. Water process business revenues were negatively impacted by a large project being completed in 1995 and the timing of contract execution on orders booked late in 1995 and early in 1996. In addition, European revenue was negatively impacted by a weak German economy and a stronger dollar. First half segment revenue grew $12.0 million to $313.2 million in 1996 from $301.2 million in 1995. Acquisitions accounted for approximately $9.0 million of the growth with the balance coming from strong biosolids and contract operations and the Asian market, partially offset by the lower water process revenue in Europe and North America. Operating expenses were virtually unchanged in the second quarter of 1996 compared with the same period of 1995, but increased as a percentage of revenue to 79.1% from 78.7% in the previous year. Selling and administrative expenses were constant between years in both dollars and ass a percentage of revenue. For the first six months of 1996, both operating expenses and selling and administrative expenses increased slightly in dollars but declined alightly as a percentage of revenue. The increase in selling and administrative costs was • due largely to the growth of Asian operations. 17 Environmental and Infrastructure Consultinc - Operating results for the three months and six months ended June 30 were as 'fol lows: Three Months Six Months 1996 1995 1996 1995 Revenue $123,233 $117,146 $233,337 $225,548 Operating expenses 99,384 91,689 189,369 176,184 Selling and admin. expenses 16,099 18. 102 32. 140 35,678 Margin $ 7,750 S 7,355 S 11,82815 3,686 Revenue grew to $123.2 million in the second quarter of 1996 compared with $117.1 million for the same period in 1995. However, labor-based revenues were $3.7 million less in 1996 than in 1995, with the shortfall offset by an increase in subcontract and other pass-through revenues that have little or no markup. As a result, operating expenses increased from 78.3% of revenue in 1995 to 80.6% of revenue in the 1996 quarter. Selling and administrative expenses declined in both dollars and as a percentage of revenue during the 1996 second quarter when compared with the same period in 1995 as the Company realized benefits from cost control programs and the consolidation of certain operating units. For the six months ended June 30, 1996, revenue was $233.3 million compared with $225.5 million in 1995, but again, the labor-based revenue was $10.0 million less in the 1996 period than in 1995, resulting in operating expenses increasing as a percentage of revenue. In addition, severe winter weather delayed client projects and reduced productivity in the first quarter of 1996. Selling and administrative expenses declined for the first six months of 1996 compared with the same period in 1995, and as a percentage of revenue were 13.8% compared with 15.8% in the prior year, a result of the factors discussed above. Discontinued Operations - In the fourth quarter of 1995, the Rust Board of Directors approved a plan to sell or otherwise discontinue Rust' s process engineering, construction, specialty contracting and similar lines of business and have Rust focus on its environmental and infrastructure consulting businesses. During the second quarter of 1996, the sale of the industrial process engineering and construction business, based in Birmingham, Alabama, was completed. Rust is currently negotiating the sales of certain other businesses, the remaining assets of which are not material to the consolidated balance sheet. The results of these transactions, which are expected to be completed by the end of 1996, will not have a material impact on the consolidated statement of income. Revenue from the discontinued businesses (through the date of sale for unite sold) was $67.0 million for the three months and $209.8 million for the six months ended June 30, 1996, compared with $220.4 million for the three-month and $380.1 million for the six-month periods in 1995. Results of operations for the three months and six months ended June 30, 1996, were not material and were included in the reserve for loss on disposition provided previously. 18 Interest - • She following table sets forth the components of consolidated interest, net, for the three months and six months ended June 30, 1996 and 1995: Three Months Six Nonths 1996 1995 1996 1995 Interest expense $117,100 $131,146 5233,589 $257,405 Interest income (6,557) (14,463) (13,699) (23,349) Capitalized interest ( 17,497) (19,299) (34,671) (39,035) Interest expense, net S 92,746 S 97,38 S185,219 $19S,021 The lower net interest expense in 1996 is a function of lower rates, including the benefit of refinancing certain debt, offsetting a reduction in capitalized interest and the impact of debt incurred to buy back the public ownership of CWM and Rust during 1995. Capitalized interest has declined as a result of continuing management effort to reduce capital expenditures. In the second quarter of 1996, WMX repurchased 5.0 million shares of its common stock and WTI repurchased 15.4 million of its shares (see ' Financial Condition - Capital Structure' below) . The debt incurred to fund these purchases will increase interest expense during the last half of 1996. Minority Interest - Minority interest declined in the second quarter and first six months of 1996 • compared with the same periods in 1995 as a result of the purchase of the public shares of CWM and Rust in 1995, and stock repurchases by wTI, which have Increased the WMX ownership of WTI to approximately 65% at June 30, 1996. Accounting Principles - Effective January 1, 1996, the Company adopted Statement of Financial Accounting Standards (•FAS' ) No. 121 - Accounting for the Impairment of Long- Lived Assets and for Long-Lived Assets to Be Disposed Of. The adoption of this standard did not have a material impact on the financial statements. The Financial Accounting Standards Board has alsb issued FAS No. 123 - Accounting for Stock-Based Compensation - which the Company must: adopt in 1996. This statement provides an optional new method of accounting for employee stock options and expands required disclosure about stock options. If the new method of accounting is not adopted, the Company will be required to disclose pro forma net income and earnings per share is if it were. The Company is studying FAS No. 123 and Is gathering data necessary to calculate compensation in accordance with its provisions, but has not decided whether to adopt the new method or quantified its impact on the financial statements. Derivatives - From time to time, the Company and certain of its subsidiaries use derivatives to manage currency, interest rate, and commodity (fuel) risk. Derivatives used are simple agreements which provide for payments based on the notional amount, with no multipliers or leverage. The Company' s use of derivatives has not been and is not expected to be material with respect to financial condition or results of operations. • 19 Environmental Liabilities The majority of the businesses in which the Company is engaged are ,intrinsically connected with the protection of the environment. As such, a significant portion of the Company' s operating costs and capital expenditures could be characterized as costs of environmental protection. As part of its ongoing operations, the Company provides for estimated closure and post-closure monitoring costs over the operating life of disposal sites as airspace is consumed. The company has also established procedures to evaluate its potential remedial liability at closed sites which it owned or operated or to which it transported waste. While the Company believes it has adequately provided for its environmental liabilities, it is reasonably possible that technological, regulatory or enforcement developments, the results of environmental studies or other factors could necessitate the recording of additional liabilities which could be material. From time to time, the Company and certain of its subeidiaries are named as defendants in personal injury and property damage lawsuits, including purported class actions, on the basis of a Company subsidiary having owned, operated or transported waste to a disposal facility which is alleged to have contaminated the environment or, in certain cases, conducted environmental remediation activities at such sites. Some of such lawsuits may seek to have the Company or its subsidiaries pay the cost of groundwater monitoring and health care examinations of allegedly affected persons for a substantial period of time, even where no actual ' damage is proven. While the Company believes that it has meritorious defenses to these lawsuits, their ultimate resolution is often substantially uncertain due to the difficulty of determining the cause, extent and impact of alleged contamination (which may have occurred over a long period of time) , the potential for successive groups of complainants to emerge, the diversity of the individual plaintiffs' circumstances, and the potential contribution or indemnification obligations of co-defendants or other third parties, among other things. Accordingly, it is reasonably possible that such matters could have a material adverse impact on the Company' s earnings for one or more fiscal quarters or years. FINANCIAL CONDITION: Licuidity and Capital Resources The Company operates in a service industry with neither significant inventory nor seasonal variation in receivables. Its primary source of liquidity is cash flow from operations, and accordingly, minimizing working capital typically does not adversely affect operations. The Company had working capital of $109. 1 million at June 30, 1996, compared with a deficit of $400.1 million at December 31, 1995. Cash and cash equivalents increased $77.4 million and net accounts receivable increased $56.5 million during the first six months of 1996. Other current assets were largely unchanged during the period. Accounts payable and accrued expenses decreased $156.7 million, while current debt declined as a result of refinancing, on a long-term basis, debt maturing during 1996 and commercial paper. The Company has adopted a strategy of raising the level of 'owners' cash flow' , which it defines as cash flow from operating activities less net capital expenditures (other than acquisitions) and dividends. Such amounts are available to make acquisitions, reduce debt, or repurchase common stock. For 1996, owners' cash flow is expected to exceed $700 million. In the second quarter of 1996, management also established a goal of converting approximately $1 billion of non- core or underperforming assets into cash by mid-1998. 20 • Acquisitions and Capital Expenditures - Capital expenditures, excluding property and equipment of purchased businesses, were $577.8 million for the SIX months ended June 30, 1996, and $585.0 million for the comparable period in 1995. In addition„ the Company and its principal • subsidiaries acquired 67 businesses for $92.8 million in cash and debt (including Slebt assumed) and 8.0 million shares of -WMX common stock during the first six months of 1996. For the first half of 1995, 59 businesses were acquired for $119.6 million in cash and debt (including debt assumed) and 0.4 million shares of WMX common stock. The pro forma effect of acquisitions made during 1995 and 1996 is not material. Capital Structure - The Boards of Directors of WMX and WTI have authorized their respective companies to repurchase shares of their own common stock (up to 25 million shares In the case of WHX and 20 million shares in the case of WTI) in the open market or in privately negotiated transactions. These programs extend into 1997. WTI repurchased 19.2 million shares under its program, including 15.4 million in the second quarter and 18.4 million during the first six months of 1996. WMX had repurchased 5.0 million shares through June 30, 1996, all during the second quarter of the current year. In conjunction with its authorized repurchase program, WHX periodically Bells put options on its own common stock. The put options give the holders the right at maturity to require the Company to repurchase its shares at specified prices. Proceeds from the sale of the options are credited to additional paid-in capital. In the event the options are exercised, the Company may elect to pay the holder in cash the difference between the strike price and the market price of the Company' s shares in lieu of repurchasing the stock. At June 30, 1996, put options were outstanding on 12.5 million shares, 4.7 million of which subsequently expired unexercised an the price of the Company' s stock was in excess of the strike price at maturity. The remaining options expire in October and November of 1996 with strike prices of $33.45 to $35.17 per share. Excluding debt of acquired companies and the impact of currency translation, • net debt increased $172.2 million in the second quarter and $436.2 million during the first six months of 1996. The increase was primarily a result of the share repurchases by the Company and WTI. Contincencies - WH International has received an assessment of approximately 417 million Krona (approximately $63 million) from the Swedish Tax Authority, relating to a transaction completed in 1990. WM International. believes that all appropriate tax returns and disclosures were filed at the time of the transaction and intends to vigorously contest the assessment. 0 There have been no significant developments in regard to this matter during the first six months of 1996. A subsidiary of WHI has been involved in litigation challenging a municipal zoning ordinance which restricted the height of its New Milford, Connecticut, landfill to a level below that allowed by the permit previously issued by the Connecticut Department of Environmental Protection ('DEP' ) . The WHI subsidiary is presently under an order of the Superior Court to apply to the DEP for permission to remove all waste above the height allowed by the zoning ordinance. The Company believes that the removal of such waste is an inappropriate remedy and has appealed the Superior Court order to the Connecticut Supreme Court. The Company is unable to predict the outcome of this appeal or the nature and extent of any removal action that might ultimately be required. However, if the Superior Court order is not modified, the subsidiary could incur substantial costs, which could vary significantly depending upon the nature of any plan eventually approved by the applicable regulatory authorities, the actual volume of waste to be moved, and other factors, and which could have a material adverse effect on the Company' s financial condition and results of operations in the near term. • 21 held to be unccnetituticnai. clow control typically :evolves a governmental , authority specifying the disposal site for all solid waste generated within its borders. The New Jersey rsling is one of a number of similar court rulings since a 1994 U.S. Supreme Court decision that state and local governments may not constitutionally restrict the free movement of trash in interstate commerce ,through the use of flow control laws. other subsequent court decisions have upheld nonregulatory means by which municipalities may effectively control the flow of solid waste. Federal legislation has been proposed, but not enacted, to l' essentially grandfather existing flow control mandates. WTI' a Gloucester County, New Jersey, trash-to-energy facility relies on a disposal franchise for substantially all of its supply of municipal solid waste. The Federal District Court stayed its injunction for as long as its ruling is on appeal, plus an additional period of two years, to enable the State to devise an alternative nondiscriminatory approach. The Company believes that the State is considering an appeal of the District Court decision. To date, court decisions with regard to flow control have not had a material adverse effect on the Company' s operations. However, given the surrounding uncertainty, it is not possible to predict what impact, if any, this matter may have in the future on the Company' s disposal facilities, particularly WTI' a trash-to-energy facilities. In the ordinary course of conducting it business, the Company becomes involved in lawsuits, administrative proceedings, and governmental investigations, including antitrust and environmental matters. Some of these proceedings may result in fines, penalties or judgments being assessed against the Company which, from time to time, may have an impact on earnings for a particular quarter or year. The Company does not believe that these proceedings, individually or in the aggregate, will have a material adverse effect on its results of operations or financial condition. 22 PART II - OTHER INFORMATION • «ITEM 1. Legal Proceedince. The majority of the businesses in which the Company is engaged are intrinsically connected with the protection of the environment and the potential for the unintended or unpermitted discharge of materials into the environment. In the ordinary course of conducting its business activities, the Company becomes involved in judicial and administrative proceedings involving governmental authorities at the federal, state and local level, including, in certain instances, proceedings instituted by citizens or local governmental authorities seeking to overturn governmental action where governmental officials or agencies are named as defendants together with the company Or one or more of its subsidiaries, or both. In the majority of the situations where proceedings are commenced by governmental authorities, the matters involved relate to alleged technical violations of operate or permits pursuant to which the Company ° or is g to perate or laws or regulations to which its o are subject, or are the result of different interpretations of the applicable requirements. From time to time the Company pays fines or penalties in environmental proceedings relating primarily to waste treatment, storage or disposal or trash-to-energy facilities. As of June 30, 1996, neither the Company nor any of its subsidiaries was involved in any such proceeding where it is believed that sanctions involved may exceed $100,000. Subject to the discussion below concerning the Company's New Milford, Connecticut landfill, the Company believes that these matters will not have a material adverse effect on its results of operation or financial condition. However, the outcome of any particular proceeding cannot be predicted with certainty, and the possibility remains that technological, regulatory or enforcement developments, the results of environmental studies or other factors could materially alter this expectation at any time. In May 1996, a Company subsidiary paid a civil penalty of $203,000 to • settle an administrative proceeding brought by the United States Environmental Protection Agency involving alleged failure by the subsidiary in 1985 to test incoming loada of polychlorinated biphenyl wasters at the subsidiary's Model City, New York facility. In settling this matter, the subsidiary did not admit any violation of law. A subsidiary of the Company has been involved in litigation challenging a municipal zoning ordinance which restricted the height of its New Milford, Connecticut the landfill to a ticutlevel below thDepartment ofatEnvironment 1 hPrallowed by te oteect on reviously Although a lower court had declared the zoning ordinance's height limittation unconstitutional, the Connecticut Supreme Court reversed that ruling and remanded the case for further proceedings in the Superior Court in the judicial district of Litchfield. On November 8, 1995, the Superior Court ordered the Company's subsidiary to apply to the DEP for permission to remove all waste above the height allowed by the zoning ordinance. The Company believes that removal of such waste is an inappropriate remedy and its subsidiary has appealed the Superior Court order to the Connecticut Supreme Court. The Company is unable to predict the outcome of the appeal or any removal action that may ultimately be required following further appeals or as a result of the permitting process. However, if the lower court order as to removal of the waste in not modified, the subsidiary could incur substantial costs, which could vary significantly depending upon the nature of any plan which is eventually approved by applicable regulatory authorities for removing the waste, the actual volume of waste to be moved and other currently unforeseeable factors and which could have a material adverse effect on the Company's financial condition and results of operations in one or more future periods. ITEM 4. Submission of Hatters to vote of Security Holders. At the CcWpany's annual meeting of stockholders on May 10, 1996, a proposal • to elect the nominees listed in the following table as directors of the Company was submitted to a vote of the Company's stockholders. The following table also 23 shows the results of voting as to each nominee: Nominee Votes For Votes Withheld Pastora San Juan Cafferty 414,927,357 7,058,941 Donald F. Flynn 414,188,389 7,797,909 James R. Peterson 414,849,973 7,136,325 Phillip B. Rooney 414,785,295 7,201,003 At the same meeting, a proposal to ratify the appointment of Arthur Andersen LLP as independent auditors for 1996 and stockholder proposals urging that the Board of Directors of the Company (1) establish a policy that members of the Board are to refrain from accepting consulting or other fees from the Company while they serve on the Board and (li) take the necessary steps to elect all Company directors annually, were submitted to the Company's stockholders. The ratification of the appointment of auditors was approved, while both stockholder proposals were defeated. Votes Broker Proposal Votes For Against Abstentions Non-Votes Ratification of Auditors 420,162,786 1,162,636 660,474 402 Stockholder Proposals (i) Policy on fees 110,889,499 250,760, 609 8,818,674 51,517,516 (ii) Annual director election 166,947,330 199,101,882 4,413,573 51,523,513 ITEM 6. Exhibits and Reports on Form 8-R. (a) Exhibits. The exhibits to this report are listed in the Exhibit Index elsewhere herein. (b) Reports on Form 8-R. The Company filed a report on Form 8-K dated June 10, 1996 reporting the issuance of a news release stating that due to continuing weakness in prices for recyclable paper fiber and an expectation that recycling markets will not improve in the near term, (i) the Company's. Waste Management, Inc. subsidiary was adjusting the capacity of its North American recycling operations to respond to the nation's weak recycling economy and (11) the Company's second quarter earnings were expected to fall in the range of $.45 to 5.47 per share and the year was expected to be in the range of $1.85 to $1.90 per share. 24 SIGNMMEs Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. WMX TECHNOLOGIES, INC. e I J ams; E. KOENIG James E. Koenig Senior Vice President and Chief Financial Officer • August 12, 1996 • 25 WHX TECHNOLOGIES, INC. EXHIBIT INDEX Number and Description of Exhibit* 2 None 3 None 4 None 10 None 11 None 12 Computation of Ratios of Earnings to Fixed Chargee 15 None 18 None 19 None 22 None 23 None 24 None 27 Financial Data Schedule 99 None Exhibits not listed are inapplicable. 26 EXHIBIT 12 WHX TECHNOLOGIES, INC. Ratio of Earnings to Fixed Charges (Unaudited) (millions Of dollars, except ratio) Six Months Endgd u � 1995111 1996 Income From Continuing Operations Before Income Taxes, Undistributed Earnings from Affiliated Companies and Minority Interest . . . . . . . $595.0 $735.6 Interest Expense . . . . . . . . . . . . . . . 257.4 233.6 Capitalized Interest . . ' . (39.0) (34.7) One-Third of Rents Payable in the Next Year . ' 25.6 26.9 Income From Continuing Operations Before Income Taxes, Undistributed Earnings from Affiliated Companies, Minority Interest, Interest and • One-Third of Rents . . . . . . . . . . . . . 839.061.4 Interest Expense . . . . . . . . . . . . . . . . $257.4 �_ $233.6 One-Third of Rents Payable in the Next Year . ' 25.6 26.9 Interest Expense Plus One-Third of Renta . . . 283.0 60.5 Ratio of Earnings to Fixed Charges . . . . . . 2.96 to 1 3.69 to 1 ( 1) The results for 1995 include a special charge ($140.6 million before income taxes) , recorded by the Company's Chemical Waste Management, Inc. subsidiary, primarily related to a writeoff of certain investments in hazardous waste treatment and processing technologies and facilities. Excluding the effect of this charge, the ratio of earnings to fixed charges would be 3.46 to 1. • <DOCUMENT> <TYPE> EX-27 <DESCRIPTION> FINANC:AL DATA SCHEDULE FOR 2ND QUARTER 10-Q <TEXT> <ARTICLE> 5 <LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE JUNE 30, 1996 CONSOLIDATED BALANCE SHEET AND THE CONSOLIDATED STATEMENT OF INCOME FOR THE SIX-MONTH PERIOD ENDED JUNE 30, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS AND THE FOOTNOTES THERETO. </LEGEND> <MULTIPLIER> 1,000 <TABLE> <S> <C> <PERIOD-TYPE> 6-MOS <FISCAL-YEAR-END> DEC-31-1996 <PERIOD-START> JAN-01-1996 <PERIOD-END> JUNE-30-1996 <CASH> 266,435 <SECURITIES> 25,878 <RECEIVABLES> 1,997,961 <ALLOWANCES> 60,563 <INVENTORY> 0 <CURRENT-ASSETS> 3,189,125 <PPBE> 14,244,714 <DEPRECIATION> 4,315,809 <TOTAL-ASSETS> 19,303,837 <CURRENT-LIABILITIES> 3,080,056 <BONDS> 7,123,055 <COMMON> 507,098 <PREFERRED-MANDATORY> �-- <PREFERRED> <OTHER-SE> 4,683,606 <TOTAL-LIABILITY-AND-EQUITY> 19,303,837 <SALES> 0 <TOTAL-REVENUES> 5,035,316 <CGS> 0 <TOTAL-COSTS> 3,559,567 <OTHER-EXPENSES> 0 <LOSS-PROVISION> 14,896 <INTEREST-EXPENSE> 198,918 <INCOME-PRETAX> 692,890 <INCOME-TAX> 284,670 <INCOME-CONTINUING> 408,220 <DISCONTINUED> 0 <EXTRAORDINARY> 0 <CRANGES> 0 <NET-INCOME> 408,220 <EPS-PRIMARY> 0.83 <EPS-DILUTED> 0.00 </TABLE> </TEXT> </DOCUMENT> -.v,w - __ - ...�: _ .ti:w r gay_ r+w�� � �•. SECURITIES AND EXCHANGE COI. III IISSION • • WASHINGTON, D.C. 20549 FORM 10-K ❑x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 1995 ❑ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 1-7327 WMX TECHNOLOGIES, INC. (Exact name of registrant as specified in its charter) DELAWARE 36-2660763 (State or other jurisdiction of (IRS Employer incorporation or organisation) Identification No.) 3003 BUTTERFIELD ROAD, OAK BROOK:, ILLINOIS 60521 (Address of principal executive office) (Zip code) Registrant's telephone number, including area code: (708) 572-8800 Securities registered pursuant to Section 12(b) of the Act: Tine of Foch Ciao Name of Eseh Exchavge on Which Registered • Common Stock,$1.00 par value New York Stock Exchange,. Zurich Stock Exchange Chicago Stock Exchange Geneva Stock Exchange London Stock Exchange Basle Stock Exchange Frankfurt Stock Exchange Liquid Yield Option Notes due 2001 New York Stock Exchange 83'4'70 Debentures due 2018 New York Stock Exchange Liquid Yield Option Notes due 2012 New York Stock Exchange Chemical Waste Management, Inc Liquid Yield Option Notes due 2010 New York Stock Exchange Convertible Subordinated Notes due 2005 New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark whether the registrant t 1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchanee Act of 193-1 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports). and ('_) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check marl- if disclosure of delinquent tilers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitne proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ❑x The aggregate market value or the toting stock of the registrant held by stockholders who were not affiliates (as defined by regulations of the Securities and Exchange Commicc;nni of the registrant was approximately $14,457,190.000 at February 1. 1996 (based on the closing sale price on the New York Stock Exchange Composite Tape on January 31. 1996, as reported by The Wall Street Journal Midwest • Edition l). At March 20, 19%,the registrant had issued and outstanding an aggregate of 494.495.743 shares of its common stock of record. Documents Incorporated by Reference Those sections or portions of the registrant's 1995 Annual Report to Stockholders and of the registrant's proxy statement for the Annual Meeting of Stockholders to be held on Mav 10, 1996 described in Parts 1I. 111 and IV hereof are incorporated by reference in this report WNIX TECIUtiOLOGIES. INC. EXHIBIT INDEX • Number and Description of Exhibit- 1. Inapplicable 2. Inapplicable 3.1(a) Restated Certificate of Incorporation of registrant. as amended as of May 24, 1985 (incorporated by reference to Exhibit 4.1 to registrant's report on Form 10-Q for the quarter ended June 30. 1985) 3.1(b) Certificate of Amendment of Restated Certificate of Incorporation of registrant, recorded \fav 23. 1986 (incorporated by reference to Exhibit 4(c) to registrant's registration statement on Form S-8. Registration No. 33-6265) 3.1(c) Certificate of Designation of Preferred Stock of registrant filed January 30, 1987 (incorporated by reference to Exhibit 3.1(c) to registrant's 1986 annual report on Form 10-K) 3.1(d) Certificate of Amendment of Restated Certificate of Incorporation of registrant. recorded %hay 15. 1987 (incorporated by reference to Exhibit 4.5(d) to registrant's registration statement on Form S—t. Registration No. 33-15518) 3.1(e) Certificate of Amendment of Restated Certificate of Incorporation of registrant. filed Mav 19, 7989 (incorporated by reference to Exhibit 3(e) to registrant's registration statement on Form S-3. Registration No. 33-30190) 3.1(f) Certificate of Amendment of Restated Certificate of Incorporation of registrant. filed May 18, 1990 (incorporated by reference to Exhibit 4(h) to registrant's registration statement on Form S-8, Registration No. 33-35936) 3.141 Certificate of Amendment of Restated Certificate of Incorporation of registrant, filed May 14. 1993 . (incorporated by reference to Exhibit 4(a) to registrant's report on Form 8-K dated May 14, 1993) 3.1(h) Conformed copy of Restated Certificate of Incorporation of registrant, as amended (incorporated by reference to Exhibit 4(b) to registrant's report on Form 8-K dated May 14, 1993) 3.2 By-laws of registrant, as amended and restated as of January ..--8. 1995 (incorporated by reference to Exhibit 3.2 to registrant's 1994 annual report on Form 10-K) 4.1(a) Rights Agreement dated as of February 6. 1987. between thq registrant and Hams Trust and Sayings Bank. which includes as Exhibit A the form cf Certtacate of Designation of Preferred Stoc. . as Exhibit B. the form of Rights Certificate and, a Exhibit C. the Summary of Rights (incorpora;ed �•: reference to Exhibit 4 to registrant's report on Form 8-K ated January :6. 19871 a.lib) Cer-u-1cate e( Adjustment relating to April 1987 ;tock sciit pursuant to Section 1_ of the Rents Agreement )incorporated by reference to Exhibit 4.3(b I to regiscant's registration statement on Form S-1. Registradon No. 33-13839) - , 1 :1 Certificate of Adjustment relating to December 1.989 stuck split pursuant to Section 12 of the Rghts Agreement (incorporated by reference to Exhibii 4.3(c i reizia,rant's 1989 annual report on Form 10-Ki alias Trust Indenture dated as of august L 1989 (incorporated reference to Exhibit 4,3(a) to registrant s 1990 annual report on Form 10-K) First Supplemental Indenture dated as of December 1. :990 incorporated by reference to Exhibit 41t'ei to registrant's 1990 annual report on For .0-Ki '!n the case of incorporation by reference to documents riled under the Secunties Exchange Act of 193,. the • -egistrant s file number under that Act is 1--31_7. C ermcai Waste Management. Inca, file number enar _'sat Act etas 1-9__3 and Wheeiabrator Technologies 1- rm :.'s file nurer under that Act is 0-14_46. EX '101iiher �;m Ut'+lrionnn fit F.thmit• ' 1.3 Trust Indenture dated as-of June 1993 (incorporated by reference to Exhibit 'I, to the regis ant; current report on Form 8K dated Jul- 15. 1993( - Inapplicable 6. Inapplicable 7. Inapplicable 8. Inapplicable 9. None 10.1 1981 Stock Option Plan for von-Emplovee Directors of registrant (incorporated by reference to Exhibit 19 to registrant's report on Form 10-Q for the quarter ended June 30, 1982) 10.2 WMX Technologies. Inc. 1982 Stock Option Plan, as amended to March 11. 1988 (incorporated by reference to Exhibit 10.3 to registrant's 1988 annual report on Form 10-K) 10.3 Deferred Director's Fee Plan, as amended (incorporated by reference to Exhibit 10.3 to registrant's 1990 annual report on Form 10-K) 10.4 Director's Phantom Stock Plan (incorporated by reference to Exhibit 10.9 to registrants 1984 annual report on Form 10-K) 10.5 Employment Agreement. dated as of September 1, 1986. by and between the registrant and Philho B. Rooney (incorporated by reference to Exhibit 19.4 to registrant's report on Form 10-Q for the quaner ended September 30. 1986) 10.6 M, IX Technologies. Inc. Corporate Incentive Bonus Plan (incorporated by reference to Exhibit B to the registrant's Proxy Statement for its 1995 Annual Meeting of Stockholders) 10.7 WMX Technologies. Inc. Supplemental Executive Retirement Plan, as amended and restated as of January 24. 1995 10.8 WMX Technologies. Inc. Long Term Incentive Plan, as amended and restated as of January 27 1, 4 Meeting of (incorporated by y reference to Exhibit A to the registrant's Proxy Statement for its 199'5 Annual 10.9 Supplemental Retirement Benent Agreement, dated as of January 1, 1989, by and between he registrant and Peter H. Huizenga (incorporated by refer, to Exhibit 10.16 a between -e Amendment No. '_ to registrant'; registration statement on Form S-1. Registration NO. 33-13839) !0.10 Chemical Waste Management. Inc. 1986 Stock Option Plan, o Exhibit 10.1 [o Chas amended [incorporated by reference emical Waste Management. Inc.'s 1959 annual report on Form In-Ki J.11 W'SlX Technoloetes. Inc. Non-Qualified Protit Sharing and Savings Plus Plan :0.12 Chemical Waste Management. Inc. Deferred Director's Fee Plan (incorporated by reference to Exh b;t 10.5 to Chemical W'a;te Management. Inc.'s registration statement on Form S-1. Reg scranon So. .3. 8509) 10.13 WMX Technologies. Inc. Directors Charitable Endowment P!an (incorporated by reterence to Exhia:; 10.20 to registrant's :989 annual report on Form 10-K) 0. 14 Supplemental Retirement Benefit Agreement laced as of January L 1991 by and ber'.eeen regtscr_ and Donald F. Flnn incorporated b% rete,-ence to Exhibit 10.17 to registrant's 1990 annual report en Form 10-Ki `In the case of Incorporation by reterence :o documents 'led under 7:e Securities Exchange Act of 1934ce registrant s file number Linc:: that A t t; 1---,:7. Chemical Baste vlanagemen[. Incrile number.'s undr. Iliac Act Lias I-9'_53 and Wheelabrator T.chnologres lnc.'s file number under that Act is 0-11_.:6. EY-= Number and Description of Exhibit- 10.15 Restncted Unit Plan for Non-Employee Directors of Wheelabrator Technologies Inc. as amended through June 10. 1991 iincorporated• by reverence to Exhibit 19.03 to the report on Form ]0-Q of Wheelabrator Technologies Inc. for the quarter ended June 30, 1991) 10.16 1988 Stock Plan for Executive Employees of Wheelabrator Technologies Inc. and its subsidiaries (the "WTI 1988 Stock Plan") (incorporated by reference to Exhibit 28.1 to ,amendment No. 1 to the registration statement of Wheelabrator Technologies Inc. on Form S-8. Registration No. 33-31523) 10.17 Amendments dated as of September 7. 1990 to the WTI 1988 Stock Plan (incorporated by reference to Exhibit 19.02 to the 1990 annual report on Form 10-K of Wheelabrator Technologies Inc.( 10.18 Amendment dated as of November 1, 1990 to the WTI 1988 Stock Plan (incorporated by reference to Exhibit 19.04 to the 1990 annual report on Form 10-K of Wheelabrator Technologies Inc,) 10.19 1986 Stock Plan for Executive Emplovees of Wheelabrator Technologies Inc. and its subsidiaries (the "WTI 1986 Stock Plan'') (incorporated by reference to Exhibit 28.2 to ,amendment No. I to the registration statement of Wheelabrator Technologies Inc. on Forim S-8, Registration No. 33-31523) 10.20 Amendment dated as of November 1, 1990 to the WTI 1986 Stock Plan (incorporated by reference to Exhibit 19.03 to the 1990 annual report on Form 10-K of Wheelabrator Technologies Inc.) 10.21 Employment Agreement dated as of April 1. 1995 between the registrant and D. P. Pavne 10.22 WMX Technologies. Inc. 1992 Stock Option Plan (incorporated by reference to Exhibit 10.31 to registrants registration statement on Form S-1. Registration No. 3.--'(819) 10.23 WAIX Technologies. Inc. 1992 Stock Option Plan for Non-Ernpiovee Directors (incorporated by reference to Exhibit 10.32 to registrant's registration statement on Form S-1, Registration No. 33- 44819) 10.2+ W'heeiabra[or Technoiogies Inc. i992 SOCK Option Plan (incorporated by reference to Exhibit 10.45 • to the 1991 annual report on Form 10-K of wheeiabrator Technologies Inc.! 10.25 Deferred Director's Fee Plan of Wheelabrator Technologies Inc. adopted June 10, 1991 (incorporated by reference to Exhibit I9.0'_ to the quarterly report on Form l0-Q of Wheelabrator Technologies Inc. for the quarter ended June 30. 1991) - 10.26 Waste 4lanaeement International plc Share Option Plan (incorporated by reference :o Exhibit 10.1 to the registration statement on Form F-I of Waste Management International pic. Registration No. 33- 16511) 10.27 .amendment dated as of December 6. 1991 :o the WTI 1986 Stock Plan i incorporates by reference to Exhibit 19.01 to the 1991 annual report on Form 10-K of Wheelabrator Technoioo:es Inc.( 10.1-3 .amendment dated as of December o. 199! :o the WTI 1988 Stock Plan i incorporates by reference to Exhibit 19.02 to t.`.e 1991 annual report on Forrn 10-K of Wheelabrator Tecr,noloe'es Inc.) 10.29 Amendment dated as of December 6, 1991 :o the Restricted Unit Plan for Non-Emp!o%ee Directors of W'heeiabrator -echnoio_ies Inc. ince^crated by reference io Exhibit '19 05 t,, :he 1991 annual report on Form 10-K of Wheelabrator Technologies Inc.( 10.30 First ,amended and Restated Intemationai Business Opportunities .agreement D% ane :rnong re^istrant. Chemical W'as:e %lana__ment. Inc.. `k-heeiabrator Techncic_;es Inc_ Waste Nlanacement International. Inc.. 'Waste Management International plc and Ru-t Intema[:onal ir.c_ gated as of lanuarc I. 1993 :r._ -ora:ed by reieren:e ro Exhibit _S to the re__:»anon tatem:n: on Form. S-3 of Wheelabrator Teccriogies Inc.. Registrat:cn No. ',-­59606- 'in 3-59606'In the case of incorpora_ca bY reference to der.:rnents filed under :he Sect^ties Ex:rar,c_e .-\ct of 1931, the • registrant s file number _-der tr.at .act is 1-'31-'. Chemical Waste Mana_ement. 1'c. . !z number under Act ct .%as 1-91-53 ane '.«ze;acrator Techno:o_tes Ine.'s file numbe?ecdzr that .act t, i-!11-16, EX-3 Number and Dewnpuon of E%hibit- _ 10.31 Amendment dated as of January 28. 1994 relating to the intemauonal Business Opportunities Agreement (incorporated by reference to Exhibit 10.19 to the 1993 annual report on J orm 10-K of Cherrucal Waste N Ianagement. Inc.; 10.32 Chemical Waste Management. Inc. 1992 Stock Option Plan (incorporated by reference to Exhibit 10.19 to the 1991 annual report on Form 10-K of Chemical Waste Management. Inc.) 10.33 Amendment dated as of July 10, 1995 to the International Business Opportunities Agreement dricorporated by reference to Exhibit 10 to the quarterly report on Form i(,'-Q of Wheelabrator Technologies Inc. for the quarter ended September 30, 1995) l 1. None 12. Computation of ratio of earrings to fixed charges 13.1 Manage is Discussion and Analysis of Results of Operations and Financial Condition 13.2 Financia tatements, Supplementary Data and Report of Independent Public Accountants 14. Inapplicable 15. Inapplicable 16. None 17. Inapplicable 18. None 19. Inapplicable 20. Inapplicable 21. List of subsidiaries of registrant 22. Inapplicable 23. Consent of Independent Public Accountants 24. None 25. Inapplicable 26. inapplicable 27. Financial Data Schedule 28. Mone `In the case of incorporation by reference to documents filed under the Securities Exchange Act of 1934, the registrant's file number under that .act t, 1--327. Chemical Waste Management. Incas file number under that Act %cas 1-9253 and Wheelabrator T-1chnologies Inc.'s file number under that Act s 0-1216. EX-4 PART ITEM 1. BUSIINESS. ,F?\FERAL WMX Technologies, Inc. is a leading international provider of environmental and related services. Unless are context indicates to the contrary, as used in this report the terns "Company" and "WMX Technologies" refer to WMX Technologies, Inc. and its subsidiaries. r The Company provides integrated solid waste management services in North America through Waste Management, Inc., a wholly owned subsidiary of the Company (referred to herein; together with its subsidiaries and certain affiliated companies providing waste management and related services, as "Waste Management"). The Company's solid waste management services are provided to commercial, industrial. municipal and residential customers, as well as to other waste management.companies and consist of solid waste collection, transfer, resource recovery and disposal services. As part of these services,the Company is engaged in providing, through its Recycle America'4, Recycle Canadas and other programs, paper, glass, plastic and metal recycling services to commercial and industrial operations and curbside collection of such materials from residences; in removing methane gas from sanitary landfill facilities for use in electricity generation; and in providing medical and infectious waste management services to hospitals and other health care and related facilities. In addition, through Waste Management the Company provides stmt sweeping and parking lot cleaning services and Port-0- Let3 portable sanitation services to municipalities and commercial and special event customers. Since mid-1995, Waste Management also has managed the scaffolding and other on-site industrial services businesses owned by the Company's Rust International Inc. subsidiary. The Company also provides hazardous waste management services in.Norh America The Company's chemical waste treatment, storage, disposal and related services are provided through Waste Management and Chemical Waste Management, Inc., a wholly owned subsidiary of the Company (referred to herein, together with its subsidiaries, as "CWM"), and are provided to commercial and industrial customers, as well as to other waste management companies and to governmental entities. Through Advanced Environmental Technical Services, L.E. a 60%-owned subsidiary of the Company (referred to herein, together with its subsidiaries as "AETS"), .e Company provides on-site integrated hazardous waste management services, including hazardous waste identification, packaging, removal and recycling services to industrial, institutional and governmental customers. Through its Chem-Nuclear Systems, Inc. wholly owned subsidiary (referred to herein, together with its subsidiaries, as "Chem-Nuclear"), the Company also furnishes radioactive waste management services, primarily to electric utilities and governmental entities. The Company provides comprehensive waste management and related services internationally, primarily through Waste Management International plc, a subsidiary owned approximately 56% by the Company and 129c each by the Company's Rust Intemauonal Inc. and Wheelabrator Technologies Inc. subsidiaries (referred to herein. together with its subsidiaries, as "Waste Management International"). Waste !Management International provides a wide range of solid and hazardous waste management and related environmental services (or has interests in projects or companies providing such services) in ten countries in Europe and in Argentina. Australia Brazil, Brunei, Hong Kong, Indonesia, Israel. Malaysia New Zealand, Taiwan and Thailand. Waste Management International also has an approximately 20% interest in Wessex Water Plc, an English publicly traded company providing water treatment, water distribution, wastewater treatment and sewerage services ("Wessex"). Wheelabrator Technologies Inc., an approximately 58%-owned subsidiary of the Company (referred to herein, together with its subsidiaries, as "WTI"). provides a wide array of environmental products and services that are primarily utilized in meeting the needs of municipalities and industry for clean energy and clean water. WTI's clean energy group is a leading developer of facilities and systems for. and provider of services to, the tush-to-energy. energy, and independent power markets. Through the clean energy group. WTI develops, arranges financing for. operates and owns facilities that dispose of trash and other %waste materials in an environmentally acceptable manner by recycling them into electrical or steam energy. Also within this group are •business units %%hich design, fabricate and install technologically advanced air pollution control and systems and ` Printed on recvaed paper e0lipment. Vb'ITS clean water group is principally involved in the design. nianuiacture. operation and ownership of facilities and systems used to purify water, to treat municipal and industrial wastewater. to treat and manage biosolids resulting from the treatment of wastewater by converting them into useful fertilizers. and to recvcle organic wastes into compost material useable for horticultural and agricultural purposes. The clean water °roup also designs and manufactures various products used in water and wastewater treatment facilities and industrial processes, precision profile wire screens for use in groundwater wells and other industrial and municipal applications, and certain other industrial equipment. . Rust International Inc., a subsidiary owned approximately 60% by the Company and 40% by WTI (referred to herein, together with its subsidiaries, as:"Rust''), furnishes environmental and infrastructure engineering and consulting services primarily to clients in federal, state and local government and in the chemical,petrochemical, nuclear, energy, utility, pulp and paper, manufacturing, environmental services and other industries. Rust also provides process engineering, construction, specialty contracting and related services through a business unit which Rust intends to sell or otherwise. discontinue. Rust also has an approximately 41% interest in NSC Corporation, a publicly traded provider of asbestos abatement and other specialty contracting services ("NSC"), and an approximately 37% interest in OHM Corporation, a publicly traded provider of environmental remediation services ("OHM"). See "Acquisitions and Dispositions" herein. The Company also owns an approximately 19% interest in ServiceMaster Limited Partnership, a provider of management services, including management of health care, education and commercial facilities, and lawn care, pest control and other consumer services. The following table shows the respective revenues of the Company's major business groups for the last three years, excluding the revenues of Rust's process engineering, construction, specialty contracting and related services business, which is to be sold or otherwise discontinued and is being treated as a discontinued operation, and including the revenues of the asbestos abatement services business of a former subsidiary through the May 1993 sale of that business and the revenues of the Rust remediation services business transferred to OHM through the date of the transfer in May 1995. Year ended December 31, 1993 1994 1995 ._. - (000's omitted) - Solid Waste Management and Related Services. . . . . . . . . . . . . . . . . 54,702.166 $5,117,871 S 5,642,857 Hazardous Waste Management and Related Services . . . . . . . . . . . . . 661.860 649,581 613,883 Engineering, Industrial and Related Services . . . . . . . . . . . . . . . . . . . 1,035.004 1,140,294 1,027,430 Trash-to-Energy, Water Treatment. Air Quality and Related Services 1,142.219 1,324,567 1,451,675 International Waste Management and Related Services . . . . . . . . . . . 1,411.211 1,710,862 1,865.081 Elimination of Intercompany Revenue . . . . . . . . . . . . . . . . . . . . . . . , (316.3.34) (388.470) (353.309) Consolidated Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S8.636.116 59.554.705 S10.2.37.617 As a result of a strategic review begun in 1994. management and operations of the Company ha%e been largely realigned on the basis of four principal global lines of business—waste services.clean energy, clean water and environmental and infrastructure engineering and consulting. The following table shows the respective revenues of these continuing lines of business me.. excluding revenues of Rust's process engineering, construction, specialty contracting and related services business) for the last three years. Year ended December 31. 1993 1994 1995 i 000's omitted Waste Services (including Scaffoldine and Other On-Site Industrial Services) . . . . . . . . . '. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57.457.371 58.140.785 5 8.634.836 Clean Energy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 804.016 888.037 893.513 Clean water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 392.194 489.295 618.472 Environmental and Infrastructure Engineering and Consulting . . . . . . 1_98.879 425.058 154.105 Eliminauon of Intercompany Revenue . . . . . . . . . . . . . . . . . . . . . . . (316.3411 (388.470) (353.309) Consolidated Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58.636.116 S9.554.705 510'47.617 3 s ' For information relating to expenses and identifiable assets attributable to the Companv's major business groups. see Note 13 to the Company's Consolidated Financial Statements filed as an exhibit to this report and iacomorated by reference herein. For interim periods, the revenues and net income of certain of the Companv's • businesses may fluctuate for a number of reasons. including there being for some businesses less activity during the winter months. Regulatory or technological developments relating to the environment may require companies engaged in environmental services businesses, including the Company, to modify, supplement or replace equipment and facilities at costs which may be substantial. Because certain of the businesses in which the Company is engaged are intrinsically connected with the protection of the environment and the potential discharge of materials into the environment. a material portion of the Company's capital expenditures is, directly or indirectly, related to such items. See "Management's Discussion and Analvsis of Results of Operations and Financial Condition" set forth on pages 16 to 24 of the Company's 1995 Annual Report to Stockholders (which discussion is filed as an exhibit to this report and incorporated by reference herein) for a review of property and equipment expenditures by the Company for the last three years. The Company does not expect such expenditures, which are incurred in the ordinary course of business, to have a materially adverse impact on its and its subsidiaries' combined earnings or its or its subsidiaries' competitive position in the foreseeable future because the Company's businesses are based upon compliance with environmental laws and regulations and its services are priced accordingly. Although the Company strives to conduct its operations in compliance with applicable laws and regulations. the Company believes that in the existing climate of heightened legal, political and citizen awareness and concerns, companies in the environmental services industry, including the Company, will be faced, in the normal course of operating their businesses, with fines and penalties and the need to expend funds for remedial work and related activities with respect to waste treatment, disposal and trash-to-energy facilities. Where the Company concludes that it is probable that a liability has been incurred, a provision is made in the Company's financial statements for the Company's best estimate of the• liability based on management's judgment and experience,information available from regulatory agencies and the number, financial resources and relative degree of responsibility of other potentially responsible parties who are jointly and severally liable for remediation of a specific site, as well as the typical allocation of costs among such parties. If a range of possible outcomes is estimated and no amount within the range appears to be a better estimate than any other, then the Company provides for the minimum amount within the range, in accordance with generally accepted accounting principles. Such estimates are subsequently revised, as necessary, as additional information becomes available. While the Company does not anticipate that the amount of any such revision will have a material adverse effect on the Company's operations or financial condition, the measurement of environmental liabilities is inherently difficult and the possibility remains that technological, regulatory or enforcement developments. the results of environmental studies, or other factors could materially aiter this expectation at any time. Such matters could have a material adverse impact on earnings for one or more fiscal quarters or years. While in general the Company's environmental services businesses have benefited substantially from increased zovetnmental regulation. the environmental services industry itself is subject to extensive and evolvine regulation by federal, state, local and foreign authonties. Due to the complexity of regulation of the industry and to public pressure, implementation of existing and future laws. regulations or initiatives by different levels of government may be inconsistent and difficult to foresee. In addition. the demand for certain of the Company's services may be adversely affected by the amendment or repeal. or reduction in enforcement of, federal, state and foreign laws and regulations on which the Company's businesses engaged in providing such services are dependent. Demand for certain of the Company's services may also be adversely affected by delays or reductions in funding. or failure of legislative bodies to fund. agencies or programs under such laws and regulations. The Company makes a contmumg effort to anticipate regulatory. political and legal developments that might affect its operations but is not always able to do so. The Company cannot predict the extent to which any legislation or regulation that may be enacted, amended, repealed or enforced, or any failure or delay in enactment or • enforcement of legislation or regulations or funding of agencies or programs. in the future may affect its operations. 4 A The Company was incorporated in Delaware in 1968 and subsequently succeeded to certain businesses owned by its organizers and others. The Company's common stock is listed on the New York Stock Exchange MX1 under the trading symbol "Wand is also listed on the Frankfurt Stock Exchange, the London Stock Exchange, the Chicago Stock Exchange and the Swiss Stock Exchanges in Basle. Zurich and Geneva. Unless the context indicates to the contrary, all statistical and financial information under Item 1 and Item . of this report is given as of December 31, 1995. Also, unless the context indicates to the contrary, statistical and financial data appearing under the caption "Waste Services" relate only to the Company's Waste Management, CWM, A= and Chem-Nuclear groups of subsidiaries and do not include any data relating to Rust. Rust's scaffolding and other on-site industrial services business managed by Waste Management, WTI or Waste Management International.See "Intemationai Waste Management and Related Services," "Clean Energy,Clean Water and Related Services" and "Environmental and Infrastructure Engineering and Consulting Services." WASTE SERVICES The Company's solid waste management and recycling services include residential, commercial and industrial collection, transfer and disposal services and related services provided by Waste Management. The Company's hazardous waste management services include chemical waste treatment, storage, disposal and related services provided by Waste Management and CWM, on-site integrated hazardous waste management services provided by AETS and low-level radioactive waste disposal services provided by Chem-Nuclear. For each of the three years in the period ended December 31, 1995, such services accounted for the following percentages of the Company's total North America waste services revenue (excluding scaffolding and other on- site industrial services revenue): Year ended December 31, 1993 1994 1995 Solid Waste and Recycling Collection Services: Residential . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.4% 19.8% 19.4% Commercial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26.3 26.4 26.7— Roll-off and Industrial. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.8 21.5 21, Solid Waste Disposal, Transfer and Related Services . . . . . . . . . . . . . . . . . . . . . 20.2 21.0 23.3 Hazardous Waste Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.3 11.3 9.8 100.0% 100.0% 100.0% Solid Waste Management, Recycling and Related Services At December 31. 1995, Waste Management conducted solid waste management, recvcline and related services operations in 48 states, the District of Columbia. four Canadian provinces and Mexico. During 1993. 1994 and 1995, operations in California. Florida and Pennsylvania together accounted for approximately 349. 30% and 289c, respectively, of North America solid waste revenue. No customer accounted for as much as 2% of such revenue in 1993 or 17c in 1994 or 1995. COLLECTION Waste Management provides solid waste collection services to approximately 1.072,500 commercial and industrial customers. Collection services are also provided to approximately 11,982.800 homes and apartment units. These services include collection of recyclable commodities. See "Recycling and Energy Recovery— Recycling" for a description of recycling services. Commercial and Industrial Many of Waste Management's commercial and industrial customers utilize containers to store solid waste. including "roll-offs." which are large containers dropped off at construction or other sites for the deposit of waste and then hoisted when full onto a truck for transport. These containers. ranging from l to 45 cubic yard 5 40 irk size, are usually provided to the customer as part of Waste Management's services. Stationary compactors. which compact the volume of the stored waste prior to collection, are frequently installed on the premises of •large volume customers and are usually provided to these customers in conjunction with Waste Management's collection services. Containerization enables Waste Management to service most of its commercial and industrial customers with collection vehicles operated by a single employee. Compaction serves to decrease the frequency of collection. Commercial and industrial collection services (which include containerized service to apartment buildings) are generally performed under one- to three-year service agreements. Fees are determined by such considerations as market factors, collection frequency, type of equipment furnished, length of service agreement, type and volume or weight of the waste collected, distance to the disposal facility and cost of disposal. Residential Most of Waste Management's residential solid waste collection services are performed under contracts with, or franchises granted by, municipalities giving Waste Management exclusive: rights to service all or a portion of the homes in their respective jurisdictions. Such contracts or franchises usually range in duration from one to five years. The fees received by Waste Management ate based primarily on market factors, frequency and type of service, the distance to processing or disposal facilities and cost of processing or disposaL Residential collection fees are either paid by the municipalities out of tax revenues or service charges or are paid directly by the residents receiving the service. TRANSFER Waste Management operates 151 solid waste transfer stations. A transfer station is a facility where solid waste is received from collection vehicles and then transferred to, and in some cases compacted in, large. • specia0y constructed trailers for transportation to disposal or resource recovery facilities. This procedure reduces costs by improving utilization of collection personnel and equipment and improving the efficiency of transporting waste to final disposal facilities. The services of these facilities are provided to municipalities or counties and in most instances are also used by Waste Management and by other collection companies. Fees are generally based upon such considerations as market factors, the type and volume or weight of the waste transferred, the extent of processing of recyclable materials, the transport distance involved and the cost of disposal. RECYCLLNG AND ENERGY RECOVERY Recvciing Waste Management provides recycling services in the United States and Canada through its Recycle America*. Recvcle Canaciaz and other programs. Recycling involves the removal of reusable materials from the waste stream for processing and sale or other disposition for use in various applications. Participating commercial and industrial operations use containers to separate recyclable paper, glass. plastic and metal wastes for collection. processing and sale by Waste 'Management Fees are determined by such considerations as market factom frequency of collection, type and volume or weight of the recyclable matenal, degree of processing required, distance the recyclable matenal must be transported and value of the recyclable material. As pan of its residential solid waste collecuon sen-ices, Waste Management engages in curbside collection of recvclable materials trom residences in the United States and Canada, also through its Recvcle Americas, Recycle Canada3 and other programs. Curbside recycling services generaliv involve the collection of recyclable paper, glass, plastic and metal waste matenals. which may be separated ``v residents into different waste containers or commingled with other recvclable materials. The recyclable matenals are then typically deposited at a local materials recovery facility where trey are sorted and processed•for resale. 6 A The prices received by the Companv for recyclable materials fluctuate suostanttally from quarter to quarter and year to year depending upon domestic and foreien demand for such materials. the quality of Stich materials. prices for new materials and other factors. In some instances. the Companv enters into agreements with the local governments of municipalities in which it provides recycling services whereby the governments share in the gains and losses resulting from fluctuation in prices of recyclable commodities. These agreements mitigate both; the Companv's gains and losses from such fluctuations. In. 1995. Waste Management provided curbside recycling services to approximately 7,200,000 households pursuant to more than 1,000 contracts in the United States and Canada. Waste Management has approximately 188,000 commercial and industrial recycling services customers. Waste Management operates 129 materials recovery facilities for the receipt and processing of recyclable materials. Such processing consists of separating recyclable materials according to type and baling or otherwise preparing the separated materials for sale. Waste Management also participates in joint ventures with Stone Container Corporation and American National Can Corporation to engage, respectively, in the businesses of marketing pager fibre and aluminum,steel, and glass containers for recycling. In each case Waste Management sells to the joint venture, or has the joint venture market, the paper fibre or containers collected by Waste Management to Stone Container, American National Can or other parties who will process them for reuse. The joint venture with American National Can also owns and operates three glass processing facilities. During 1995, the joint ventures processed approximately 4,496,000 tons of recyclable materials. Waste Management also provides tire and demolition and construction debris recycling services. Energy Recovery At 34 Waste Management-owned or -operated sanitary landfill facilities, Waste Management is engaged in methane gas recovery operations. These operations involve the installation of a gas collection system into a sanitary landfill facility. Through the gas collection system, gas generated by decomposing solid waste is _ collected and transported to a gas-processing facility at the landfill site. Through physi is separated from contaminants. The processed methane gas generally is then ecal processes methane gas ither si sold directly to industrial users or(ii) sold to an affiliate of the Company which uses it as a fuel to power electricity generators. Electricity public utilities under long-term sales contracts, often under terms generated by these facilities is sold, usually to or conditions which are subject to approval by regulatory authorities. WMX Technologies also engages in other resource recovery aetivities through WTI's trash-to-energy and independent power operations and Waste Management International's operations. See "Clean Energy, Clean Water and Related Services" and 'International Waste Management and Related Services." DISPOSAL Waste Management operates 133 solid waste sanitary landfill facilities. Of this number. 103 are owned by Waste Management and the remainder are leased from, or operated under contract with, others. Additional facilities are in various stages of development. Waste Management also provides yard-waste composting services, bioremediation of petroleum-contaminated soils and solidification of difficult-to-treat liquid wastes at a number of its disposal facilities. All of the sanitary landfill facilities are subject to governmental regulation. See "Regulation—Waste Services—Solid Waste." A sanitary landfill site must have geological and hydrological properties and design features which limit the possibility of water pollution, directly or by leaching. Sanitary landfill operations, which include carefully planned excavation, continuous spreadine and compacting of solid waste and co%enng of the waste. are designed to maintain sanitary conditions, insure optimum utilization of the airspace and prepare the site for ultimate use for other purposes. a Suitable sanitary landfill fac:iues and permission to expand existing facilities may be difficult to obtain in some areas because of land scarcity, local resident opposition and governmental regulation. As its existing facilities become filled in such areas, the solid waste disposal operations of Waste Management are and will continue to be materially dependent on its ability to purchase. lease or obtain operating rights for additional sites or expansion of existing sites and to obtain the necessary permits from :regulatory authorities to construct and operate them. In addition,there can be no assurance that additional sites can be obtained or that existing facilities can continue to be expanded or operated. However. management believes that the facilities currently available to Waste Management are sufficient to meet the needs of its operations in most areas for the foreseeable future. To develop a new facility, Waste Management must expend significant time and capital resources without any certainty that the necessary permits will ultimately be issued for such facility or that the Company will be able to achieve and maintain the desired disposal volume at such facility. If the inability to obtain and retain necessary permits, the failure of a facility to achieve the desired disposal volume or other factors cause Waste Management to terminate development efforts for a facility, the capitalized development expenses of the facility may need to be written off. In varying degrees, Waste Management utilizes its own sanitary landfill facilities to accommodate its disposal requirements for collection and transfer operations. In 1993, 1994 and.1995 approximately 52%, 55% and 57%, respectively, of the solid waste collected by Waste Management was disposed of in sanitary landfill facilities operated by it. Usually these facilities are also used by other companies and government agencies on a noncontract basis for fees determined by such considerations as market factors and the type and volume or weight of the waste. RELATED SERVICES Waste Management also provides or manages several types of services which are compatible with its solid waste collection operations. Included in these operations are scaffolding and other on-site industrial services, medical and infectious waste management services, portable sanitation seriices and street Sweeping and parking ® lot cleaning services. Waste Management manages the business of Rust Industrial Services Inc., a subsidiary of Rust ("RIS"), providing scaffolding and other on-site industrial services. RIS provides scaffolding services primarily to the chemical, petrochemical and utilities industries. In most cases, the scaffolding services are provided in conjunction with periodic, routine cleaning and maintenance of refineries, chemical plants and utilities. although such services are also performed in connection with new construction projects. RIS also performs a variety of types of other industrial services—water blasting, tank cleaning,-explosives blasting, chemical cleaning, industrial vacuuming, catalyst handling. specialty chemicals and separation technologies—primarily for clients in the petrochemical. chemical, and pulp and paper industries, utilities and, to a lesser extent. the public sector. RIS also provides on-site plant services, including providing personnel to perform mechanical and electrical services. equipment installation. welding, heating, %entilatine and air conditioning ("HVAC'), warehousing and inventory management services and technical support in the area of industrial hygiene and safety training.- RIS assists clients in the nuclear and uuhry industries in solving electrical,. mechanical, engineering and related technical services problems. RIS also provides spent fuel storage (rerack) services to the nuclear rower industry. Waste Management's medical and infectious waste management services consist of collecting, transporting, treating and disposing of medical and infectious %%aste generated by hospitals, pharmaceutical manufacturers. medical clinics, physician and dentist offices and other sources. Waste Management also provides portable sanitation services to municipalities and commercial customers. The portable sanitation cervices. xhich are marketed under the Port-O-Lets trade name, are also used at numerous special events and public gatherings. Certain of these related services are marketed and performed primarily by employees operating out of Waste • Management's solid waste operations facilities who also may have responsibility for some phase of solid waste marketing or operations. • Hazardous Waste Management and Related Services CHEMICAL WASTE MANAGEMENT SERVICES The Company operates chemical waste treatment, storage and disposal facilities in 16 states and also owns a majority interest in a subsidiary which operates a resource recovery and storage facility and a disposal facilir in Mexico. The chemical wastes handled by the Company include industrial by-products and residues that ha*'- been identified as "hazardous" pursuant to the Resource Conservation and Recovery Act of 1976, as amend. ("RCRA"), as well as other materials contaminated with a wide variery of chemical substances. Chemical waste may be collected from customers and transported by Waste Management or CWM or contractors retained by them or delivered by customers to their facilities. Chemical waste is transported by Waste Management or CWi l primarily in specially constructed tankers and semi-trailers, including stainless steel and rubber or epoxy-lined tankers and vacuum trucks, or in containers or drams on trailers designed to comply with applicable regulations and specifications of the U.S. Department of Transportation ("DOT") relating to the transportation of hazardous materials. Waste Management and CWM also operate several facilities at which waste collected from or delivered by customers may be analyzed and consolidated prior to further shipment. - The Company's seven secure land disposal facilities either have interim status or have been issued permits under RCRA. See "Regulation—RCRA." In general, the Company's secure land disposal facilities have received the necessary permits and approvals to accept chemical wastes, although some of such sites may accept only certain chemical wastes. Only chemical wastes in a stable, solid form which meet applicable regulatory requirements may be buried in the Company's secure disposal cells. These land disposal facilities are sited, constructed and operated in a manner designed to provide long-term containment of such waste. Chemical wastes may be treated prior to disposal. Physical treatment methods include distillation, evaporation and separation, all of which basically result in the separation or removal of solid materials from liquids. Chemical treatment methods include chemical oxidation and reduction, chemical precipitation of heavy metals, hydrolysis and neutralization of acid and alkaline wastes and essentially involve the transformation of wastes into inert materials through one or more chemical reaction processes. At two of its locations, the Company isolates treated chemical wastes in liquid form by injection into deep wells. Deep well technology involves drilling wells in suitable rock formations far below the base of fresh water and separated from it by other substantial geological confrninP- layers. AETS provides on-site integrated hazardous waste management services, including hazardous waste identification, packaging, removal and recycling services in North America. These services include on-site hazardous waste data management, education and training, inventory control and other administrative services, lab pack services, drum identification services, household hazarcrous waste programs, less-than-full load waste pickup and consolidation services, and related services. AETS provides these services primarily to industrial. institutional and public sector customers, including laboratories. In the United States, most chemical wastes generated by industrial processes are handled "on-site" at the generators' facilities. Since the mid-1970's, public awareness of the harmful effects of unregulated disposal of chemical wastes on the environment and health has led to extensive and evolving federal. state and local regulation of chemical waste management activities. The major federal statutes regulating the management of chemical wastes include RCRA. the Toxic Substances Control Act ("TSCA") and the Comprehensive Environmental Response. Compensation and Liabilities Act of 1980, as amended ("CERCLA" or "Superfund"), all primarily administered by the United States Environmental Protection Agency ("EPA"). The business is heavily Oependent upon the extent to which regulations cromulgated under these or similar stale statutes and their enforcement over time effectively require wastes to be specially handled or managed and disposed of in facilities of the type owned and operated by the Company. See "Regulation—Waste Services— Hazardous Waste." "—RCRA" and "—Superfund." The chemical waste services industry currently has substantial excess capacity caused by a number of factors. including a decline in environmental remediation projects generating hazardous waste for off-site treatment and disposal. continuing efforts by hazardous waste generators to reduce Volume and to manage it on-site, and the uncertain regulatory environment regarding 9 1 hazardous waste management and remediation requirements. These factors have led to reduced demand and increased pressure on pricing for chemical waste management services, consequences which the Companv expects to continue for the foreseeable future. iLOW-LEVEL AND OTHER RADIOACTIVE WASTE SERVICES Radioactive wastes with varying degrees of radioactivity are generated by nuclear reactors and by medical, industrial, research and governmental users of radioactive material. Radioactive wastes are generally classified as either high-level or low-level. High-level radioactive waste, such as spent nuclear fuel and waste generated during the reprocessing of spent fuel from nuclear reactors, contains substantial quantities of long-lived radionuclides and is the ultimate responsibility of the federal government. Low-level radioactive waste, which decays more quickly than high-level waste, largely consists of dry compressible wastes (such as contaminated gloves. paper, tools and clothing), resins and filters which have removed radioactive contaminants from nuclear reactor cooling water, solidified wastes from power plants which have become contaminated with radioactive substances and irradiated hardware. Chem-Nuclear provides comprehensive low-level radioactive waste management services in the United States consisting of disposal,processing and various other special services. To a lesser extent, it provides services with respect to radioactive waste that has become mixed with regulated chemical waste. Chem-Nuclear's radioactive disposal operations involve low-level radioactive waste only. Its Barnwell, South Carolina facility is one of two licensed commercial low-level radioactive waste disposal facilities in the United States and has been in operation since 1971. A trust has been established and funded to pay the estimated cost of decommissioning the Barnwell facility. A second fund, for the extended care of the facilirv, is funded by a surcharge on each cubic foot of waste received. Chem-Nuclear may be liable for additional costs if the extra charges collected to restore and maintain the facility are itrsufficient to cover the cost of restoring or maintaining the site after its closure (which Chem-Nuclear has no reason to expect). Under state legislation enacted in 1995, the Barnwell, South Carolina facility is authorized to operate until its current permitted disposal capacity is fully utilized. unless such authorization is changed by legislation However, presently pending in we South Carolina • Supreme Court is a suit challenging the 1995 legislation, which repealed earlier legislation that would have closed the Barnwell facility to out-of-state wastes. While Chem-Nuclear believes the suit (to which it is not a party) lacks merit, it is impossible to predict the outcome of the suit and its impact on future operations at Barnwell. Chem-Nuclear also processes low-level radioactive waste at its customers' plants to enable such waste to be shipped in dry rather than liquid forth to meet the requirements for receipt at disposal facilities and to reduce the volume of waste that must be transported. Processing operations include solidification, demineralization, dew•atenne and filtration. Other services offered by Chem-Nuclear include providing electro-chemical. abrasive and chemical removal of radioactive contamination. providing management services for spent nuclear fuel storage pools and storing and incinerating liquid radioactive organic wastes. INTERNATIONAL WASTE MANAGEMENT AND RELATED SERVICES The Company is a leading provider of comprehensive waste management and related services intematienally, primarily through Waste Management International. which conducts essentially all of the waste management operations of the Company located outside North Aanenca. Waste Management International's business may broadly be characterized into two areas of activity, collection services and treatment and disposal services. The following table shows the derivation of Waste Manaeement International's revenues for the vears indicated and includes} revenue from construction of treatment or disposal facilities for third patties under "Treatment and Disposal Services": Year Ended December 31. 1993 1994 1995 Collection Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69% 64& 61% Treatment and Disposal Services 31 '0 36% 36% 10 w the Cc;+npanc nas nad international operations since the mid-1970's. However, the b ulk international operations and revenues are derived from the acquisition over the last several `ears of nume or the Company's companies and interests in Europe in various of its service lines. 1n 1993, major acquisitions included. inrous UK, the acquisition by the joint venture described below between Waste Management International and Wessex of a solid waste collection and disposal company; in France, a company engaged primarily in solid collection; a The Netherlands, a company engaged in the collection and transportation of solid waste and u. sorting of demolition waste, and in Germany, a group of companies providing waste collection services and O f which sorting, In quasi Waste Management International completed 50 acquisitions in 10 countries, most Of which were small acquisitions which complemented or expanded existing Waste Management International operations in various markets. With its acquisition goals largely completed, Waste Management International engaged in 25 additional small acquisitions during 1995. In accordance with its objective of maintaining a local identity, Waste Management International, in certain cases, operates through companies or joint ventures in which Waste Management Itemational and its affiliates own less than a 100% interest. For example, Waste Management International is a party to a joan venint ture with Wessex to provide waste management and related services in the United Kingdom. Because of the size and timing of projects and acquisitions, Waste Management International's revenue mix by country varies from year to year. Countries in which revenue exceeded 10% of Waste Management International's consolidated total were: Italy (32%) and The Netherlands (11%) in 1993, Italy (26%) and Germany (12%) in 1994 and Italy (23%). Germany (14%), The Netherlands (11%) and The United Kingdom (I I%) in 1995. While Waste Management International has considerable experience in mobilizing for and managing foreign projects, its operations continue to be subject generally to such risks as currency'fluctuations and exchange controls, the need to recruit and retain suitable local labor forces and to control and coordinate operations in different jurisdictions, changes in foreign laws or governmental policies or attitudes concerning @y-- enforcement, political changes, local economic conditions and international tensions. In addition pr, adjustment provisions based on certain formulae or indices may not accurately reflect the actual impact of inflation on the cost of performance. Collection Services Collection services include collection and transportation of solid, hazardous and medical wastes and recyclable material from residential, commercial and industrial customers. The residential solid waste collection process, as well as the commercial and indusmal solid and hazardous waste collection process, is similar to that utilized by the Company in the United States. Waste Management International provided collection services as of December 31, 1995 to governmental and private customers in ten European countries. Argentina, Australia, New Zealand and Taiwan. Business is obtained through public bids or tenders, negotiated contracts, and, in the case of commercial and industrial customers, direct contracts. Waste Management International operates 318 collection and staging facilities and 76 waste transfer facilities. Residential solid waste collection is normally performed by Waste Management Intemational pursuant to municipal contracts. Waste Management International has approximately 1.500 municipal contracts, serving more than 6,800,000 residential properties. The scope, specifications, sen ices provided and duration of such contracts vary substantially, with some contracts encompassing landfill disposal of collected waste. street- sweeping and other related municipal services. The largest number of municipal contracts held by Waste Management International is in Italy where Waste Management International services approximately 1.350,000 residential properties. Pricing for murucipal contracts is generally based on volume of waste, number anr+- 11 a frequency of collection pick-ups, and disposal arrangements. Longer-term contracts typically have formulae for periodic price increases or adjustments. Waste Management International also provides curbside recyciing services similar to those provided by Waste Management in North America. . Street, industrial premises, office and parking lot cleaning servicers are also performed by Waste Management International, along with portable sanitationitoilet services for such occasions as outdoor concerts and special events. Waste Management International's commercial and industrial solid and hazardous waste collection services are generally contracted for by individual establishments. In addition to solid waste collection customers, Waste Management International provides services to small quantity waste generators, as well as larger petrochemical, pharmaceutical and other industrial customers. including collection of hazardous, chemical or medical wastes or residues. Waste Management International has approximately 285,000 commercial and industrial customers. Contract terms and prices vary substantially between jurisdictions and types of customer. Waste Management International also provides commercial and industrial recycling services. Treatment and Disposal Services Treatment and disposal services include processing of recyclable materials, operation of both solid and hazardous waste landfills, operation of municipal and hazardous waste incinerators, operation of a trash-to-energy facility, operation of water and wastewater treatment facilities, operation of hazardous waste treatment facilities and construction of treatment or disposal facilities for third parties. The operation of solid waste landfills is currently Waste Management International's most significant treatment and disposal service. Treatment and disposal services are provided under contracts which may be obtained through public bid or tender or direct negotiation, and are also provided directly to other waste service companies. At December 31, 1995, Waste Management International owned, operated or maintained 23 waste treatment facilities, 79 recycling and recydiables processing facilities. 9 incinerators and 55 landfills. . Once collected,Ysolid wastes may be processed in a recyclables processing facility for sale or other disposition for use in various applications. Unprocessed solid wastes, or the portion of the waste stream remaining after recovery of recyclable materials, require disposal, which may be accomplished through incineration (in connection with which the energy value may be recovered in a trash-to-energy facility) or through disposal in a solid waste landfill. The relative use of landfills versus incinerators differs from country to country and will depend on many factors, including the availability of land. geological and hydrological conditions, the availability and cost of technology and capital. and the regulatory environment. The main determinant of disposal method is generally the disposal cost per cubic meter at local landfills, as incineration is generally more expensive. At present, in most countries in which Waste Management International operates, landfilling is the predominant disposal method employed. Waste Management International owns or operates solid waste landfills in Argentina, Australia, Brazil. Denmark. France, Germany. Hong Kong, Indonesia. Italy, New Zealand. Spain. Sweden and the United Kingdom. Landfill disposal agreements may be separate contracts or an integrated portion of collection or treatment contracts. Demand for solid waste incineration is affected by landfill disposal costs and government regulations. The incineration process fortnon-hazardous solid waste has also been influenced by two significant factors in recent years: (i) increasingly strict control over air emissions from incinerators: and (ii) increasing emphasis on trash-to- energy incinerators, which utilize heat produced by incinerators to generate electricity and other energy. Incineration generates approximately 30`r residue (by weight). which is either landfilled or, if permitted.recycled for use as a road base or in other construction uses. Waste Management International's trash-to-energy incinerator in Harnm is a German-designed plant and the • only privately operated trash-to-energy facility in Germany. It is among the first aash-to-energy facilities to fully 12 a comply with that country's s[nngent new air pollution requirements. The facility serves the household and commercial solid waste incineration needs of a population of approximately 600.000 in Hamm and nearby towns. Under its current permits, the facility is able to produce 18 megawatts per hour of steam-generated electricity and sold approximately 71,000 megawatt hours to the local power grid in 1995 (.enough power for about 17,000 homes). In 1992, Waste !Management International entered into a contract with the County of Gates Germany to design, construct, own and operate a trash-to-energy facility. The facility is designed to convuL 268.000 metric tons per year of municipal waste and sewage sludge into energy. The facility would be capable of producing enough electricity to power more than 35,000 homes. During 1995, Waste Management International's permit application to develop and operate the Gutersloh facility was denied. Waste Management International believes it is entitled to the permit and is appealing the denial. Waste Management Intemational also operates seven small conventional municipal solid and other waste incineration facilities. Waste Management International and WTI have also formed a joint venture to develop trash-to-energy projees. outside Germany, Italy and North America_ See "Competition" below. Waste Management International owns or operates hazardous waste treatment facilities in Australia, Finland, France, Germany, Hong Kong, Indonesia, Italy, The Netherlands, Spain, Sweden and the United Kingdom and has entered into agreements with respect to the development of hazardous waste treatment facilities in Argentina and Thailand. CLEAN ENERGY, CLEAN WATER AND RELATED SERVICES Wheelabrator Clean Energy WTI, through Wheelabrator Environmental Systems Inc. and its subsidiaries, is a leading developer, operator and owner of trash-to-energy and independent power facilities in the United States. These facilities, either owned or operated give WTI approximately 850 megawatts of electric generating capacity. WTI's trash- to-energy projects irrin7 proven boiler and grate technology capable of processing up to 2,250 tons of trash per day per facility. The heat from this combustion process is converted into high-pressure steam, which typically is used to generate electricity for sale to public utility companies under long-term contracts. WTI's trash-toenergy development activities have historically involved a number of contractual arrangements with a variety of private and public entities, including municipalities (which supply trash for combustion), utilities or other power users (which purchase the energy produced by the facility), lenders, public debtholders, joint venture partners and equity investors (which provide financing for the project) and the contractors or subcontractors responsible for building the facility. In addition. WTI's activities have often included identifying and acquiring sites for the facility and for'the disposal of residual ash produced by the facility and obtaining necessary permits and licenses from local, state and federal regulatory authorities. WTI also develops, operates and. in some cases. owns independent power projects, which either cogenerate electricity and thermall energy or generate electricity alone for sale to utilities. Cogeneration is a technology which allows the consecutive use of two or more useful forms of energy from a single primary fuel source, thus providing a more efficient use of a fuel's total energy content. During 1995, WTI entered into'a joint venture for the purpose of developing small cogeneration projects for district heating applications in a province of The People's Republic of China- WTI also designs, fabricates and installs advanced air pollution control and measurement systems and equipment. WTI gffers electrostatic precipitators, flue-gas desulfurization systems tscrubbers/, fabric-filter systems (baghouses) and nitrogen oxide t "NOx'') control systems , which remove pollutants from the emissions of WTI's trash-to-energy systems, as well as power plants and other industnal facilities. WTI also designs, constructs and maintains tall concrete chimneys and storage silos. WTI offers both custom and pre-engineered systems for emission control. The custom engineering division licenses a patented process for the removal of hydrogen sulfide from gaseous and liquid streams. The process controls hazardous gases and sulfur dioxide emissions, thereby reducing acid rain and odor problems. WTI also provides a full range of technologies apd- 13 w services for destroying or recycling volatile organic compounds ("VOCs") from air and liquid sources and NOx from air sources. Both VOCs and NOx are detrimental to air quality, and the environment generally. WTI's VOC and NOx control systems are utilized by customers in a variety of industries, including oil refineries, chemical plants and automobile production facilities. Complementing the emission control divisions is a measurement division which designs and installs continuous emissions monitoring systems for the utility, trash-to-energy, industrial furnace and petrochemical industries, all of which are affected by regulations requiring the continuous monitoring of stack emissions. Wheelabrator Clean Water Through Wheelabrator Water Technologies. Inc. and its subsidiaries. WTI develops, operates and owns projects that purify water, treat water and wastewater, compost organic wastes and treat and manage biosolids. WTI also provides products and systems used to treat drinking water as well as industrial and municipal process water and wastewater. WTI is a leading provider of a broad range of water and wastewater treatment services to municipalities and industry throughout the United States, Canada and Mexico, including water and wastewater treatment plant start-up assistance, plant operations and maintenance. planning and management. training of plant supervisors, operators and laboratory.and maintenance personnel, refitting process systems, management systems for process control, and plant diagnostic evaluations and energy audits. WTI also provides specialty repair and cleaning services for industrial water and wastewater management equipment. In July 1995, WTI became the first company in the United States to acquire a publicly owned wastewater tre2tnent plant pursuant to a federal Executive Order issued in 1992. which was intended to facilitate the privatization of municipal facilities. The agreement provides for a subsidiary of WTI to operate the 4.5 million gallon per day MCD Franklin Wastewater Treatment Plant in Franklin, Ohio for a period of 20 years and to expand the facllty as needed to meet future population growth. In August 1995, WTI was selected by the City . of Wilmington.Delaware to negotiate a similar public-private partnership, including the acquisition of that City's wastewater treatment plant. WTI also provides a range of biosolids management services, including land application,drying,pelletizing, alkaline stabilization and composting of non-hazardous biosolids to approximately 450 communities, typically pursuant to multi-year contracts under which WTI is paid by the generator to make beneficial use of the biosolids. Land application involves the application of non-hazardous biosolids as a natural fertilizer on farmland pursuant to rigorous site-specific permits issued by applicable state authorities. Biosohds are also used in land. reclamation projects such as strip mines. Regulations issued by the EPA in December 1992 under the Clean Water Act encourage the beneficial use of municipal sewage sludge by recognizing the resource value of biosolids as a fertilizer and soil conditioner, and establish requirements for land application designed to protect human health and the environment. WTI also develops and operates facilities at which biosolids are dried and pelletized and has four facilities currently in operation. and one other facility under construction. WTI has approximately 560 dry-tons-per-day of biosolids drying capacity either in operation or under construction. Biosolids which have been dried are generally used as fertilizer by farmers, commercial landscapers and nurseries and as a bulking agent by fertilizer manufacturers. Development of dryer facilities generally invokes various contractual arrangements with a variety of private and public entities, including municipalities (which generate the biosolids), lenders. contractors and subcontractors which build the facilities, and end-users of the fertilizer generated from the treatment process. WTI also engineers and manufactures a variety of environmental products and systems. WTI provides single- source, advanced-systems solutions for the treatment of municipal drinking water. industrial process water and wastewater and for slum pumping and high solids dewatering. It also provides systems designed to remove • solids from liquid streams through the use of self-clearune bar/filter screens, grinders, macerators, conveyors and 14 • compactor systems. WTI also provides high technology water purification and wastewater treatment syst which utilize a variety of technoiogies including demineralizers, reverse osmosis and vacuum deitasifica products. In addition. WTI designs and installs process technology systems utilizing evaporators, rystalli.- electrodialysis, dialysis, reverse osmosis and ultrafiltration for treating industrial process wastewater. WTI produces profile wire screen products for groundwater production, hydrocarbon processing, food proc' ; coaUmineral processing. WTI also designs and supplies enclosed automated composting systems wh organic wastes into beneficial products which are used by commercial landscapers, nurseries and ferm manufacturers. WTI provides a number of these products and technologies to industrial customers abroad thrc its operations in Australia. France, Ireland. Japan. Malaysia. The Netherlands. Singapore, Spain and Taiwan. WTI also manufactures a line of nonpolluting materials cleaning systems for use by a variety of indus customers, including foundries, steel processors, automobile producers and rubber and plastics producer cleaning and finishing metal and other materials. WTI also manufactures high-alloy combustion grates use the high-temperature furnaces of its trash-to-energy facilities. ENVIRONMENTAL AND IiVFRASTRUCTURE ENGINEERING AND CONSULTING SERVICES Rust is a leading provider, through its subsidiaries, of environmental and infrastructure engineering consulting services, primarily to clients in government and in the chemical, petrochemical, nuclear, ene utility, pulp and paper, manufacturing, environmental services and other industries. Rust's environmental and infrastructure engineering and consulting services provide alternative solut for client problems relating to removing and disposing of hazardous and toxic substances; managing solid w. water and wastewater, groundwater and air resources; design and construction oversight of transportz facilities; and photogrammetry. Such services are provided to private industry, as well as federal,state and I governments, including the Department of Defense (the "DOD") and the Department of Energy (the "DO. The services include performing remedial investigations for the purpose of characterizing hazardous waste s preparing feasibility studies setting forth recommended alternative remedial actions, and providing <- design and construction oversight services for remediation projects.The services provided also includ, permitting, design and construction oversight of solid and hazardous waste landfills and related facilities. St design and construction oversight services are also provided. primarily to municipalities, special governs agencies and, to some extent, private industry in connection with wastewater collection and treatment, pot water supply treatment and distribution. 5tormwater management and the building of streets, highways, aitp bridges, waterways and rail services. Rust also provides architectural services in connection with these and r activities. Additional services provided through Rust include environmental assessment services, the desir systems to properly and safely store, convey, treat and dispose of industrial, hazardous and radioactive mate and consulting services regarding disposal, waste minimization methods and techniques, air quality regui, and industrial hygiene and safety. Rust also has an international environmental and infrastructure engineering and consulting, prc engineering and construction services and related services business performing projects in 35 countries Europe, Rust has offices in the United Kingdom. Germany, Sweden and Turkey, and in the Asia-Pacific res in Australia, Hong Kong, China, Singapore, Malaysia and Indonesia. In the Middle East and Africa. Rust has offices in the United Arab Emirates, Saudi Arabia and South Africa. Rust's overseas operations provide services to the World Bank and associated lending agencies. national, regional and local governments at.. clients in the utility and industrial power and general manufacturing industries. In addition, Rust provides services to Waste !Management International worldwide. In May 1995, Rust sold substantially all of its hazardous and radioactive remediation services businer OHNI. As a result of that transaction. Rust acquired an approximately 37% interest in OHM. See "Acquisr and Dispositions." 15 e Rust also engages in providing process engineering. construction. specialty contracting and related services, but has announced its intention to sell or otherwise discontinue that business in North America and certain locations outside North America. The process engineering services currently provided by Rust are of two general types: facility process engineering and facility design engineering. Process engineers create the processes by which facilities operate, such as chemical, petrochemical, energy and pulp and paper plants. Design engineering services provided by Rust encompass the following disciplines: architectural, electrical,control systems, process piping, mechanical, structural. HVAC, and civil. The construction services currently provided by Rust are generally performed in connection with projects on which Rust has also pravided the design engineering services. Rust also requisitions and procures equipment and construction materials for clients and performs quality assurance and quality control oversight of vendor manufacturing practices. Rust also has scaffolding and other on-site industrial services businesses, which are managed by Waste Management. See "Waste Services—Solid Waste Management, Recycling and Related Services—Related Services" above. REGULATION While in general the Company's environmental services businesses have benefited substantially from increased governmental regulation, the environmental services industry itself has become subject to extensive and evolving regulation by federal, state, local and foreign authorities. In particular, the regulatory process requires firms in the-Company's industries to obtain and retain numerous govemmental permits to conduct various aspects of their operations, any of which may be subject to revocation.modification or denial. As a result of governmental policies and attitudes relating to the industries, which are subject to reassessment and change, the Company believes that its ability to obtain applicable permits from governmental authorities on a timely basis, and to retain such permits, could be impaired. The Company is not in a position at the present time to assess the extent of the impact of such potential changes in governmental policies and attitudes on the permitting processes. but it could be significant. In particular, adverse decisions by governmental authorities on permit • applications submitted by the Company may result in abandonment of projects, premature closure of facilities or restriction of operations, which could result in a loss of earnings from a facility, a write-off of capitalized development expenses or both. Federal, state, local and foreign governments have also from time to time proposed or adopted other types of laws, regulations or initiatives with respect to the environmental services industry. Included among them am laws, regulations and initiatives to ban or restrict the international, interstate or intrastate shipment of wastes, impose higher taxes on out-of-state waste shipments than in-state shipments, reclassify certain categories of hazardous wastes as non-hazardous and regulate disposal facilities as public utilities. Certain state and local governments have promulgated "flow control" regulations. which attempt to require that all waste generated within the state or local jurisdiction must go to certain disposal sires. The United States Congress has from time to time considered legislation that would enable or facilitate such bans, restrictions, taxes and regulations. Due to the complexity of regulation of the industry and to public pressure. implementation of existing or future laws, regulations or initiatives by different levels of government may be inconsistent and difficult to foresee. Many state and local governments have enacted mandatory or voluntary recycling laws and bans on the disposal of yard-waste in landfills. The effect of these and similar laws is to reduce the volume of wastes that would otherwise be disposed in Company landfills. In addition. municipalities and other governmental entities with whom the Company contracts to provide solid waste collection or disposal services, or both. may require the Company as a cond$ion of securing the business to provide recycling services and operate recycling and composting facilities. which may cause the Company to incur substantial costs. The Company makes a continuing effort to anticipate regulatory, political and legal developments that might affect its operations but is not always able to do so. The Company cannot predict the extent to wcdch any legislation or regulation that may be enacted. amended. repealed or enforced, or any failure or delay in enactment or enforcement of legislation or regulations or funding of government agencies or programs. in the future may affect its operations. Such matters could have a material adverse impact on the Company's earnings for one or more fiscal quarters or years. 16 The demand for certain of the services provided by the Company, particularly its hazardous waste management services, is dependent on the existence and enforcement of federal, state and foreign laws and regulations which govem the discharge of hazardous substances into the environment and on the funding of agencies and programs under such laws and regulations. Such businesses will be adversely affected to the extent that such laws or regulations are amended or repealed, with the effect of reducing the regulation of, or liars. for, such activity, that the enforcement of such laws and regulations is lessened or that funding of agenci,I .q programs under such laws and regulations is delayed or reduced. In particular, the EPA has recently proposed regulations under RCRA to redefine the term "hazardous waste" for regulatory purposes. Under the proposal, wastes containing minimal concentrations of hazardous substances would no longer be subject to the stringent proposed regulations would cause certain wastes which presently must be managed in TSCArecord-keeping, handling, treatment and disposal rules applied to hazardous wastes under RCRA, Other EPA- -approved facilities to be eligible for disposal in facilities not approved under TSCA. These proposed rules would, if adopted,reduce the volume of wastes for which the Company's hazardous waste management services are needed In addition to environmental laws and regulations, federal government contractors, including the Company, are subject to extensive regulation under the Federal Acquisition Regulation and numerous statutes which deal with the accuracy of cost and pricing information furnished to the government, the allowability of costs charged to the government, the conditions under which contracts may be modified or terminated, and other similar matters. Various aspects of the Company's operations are subject to audit by agencies of the federal government in connection with its performance of work under such contracts as well as its submission of bids or proposals to the government Failure to comply with contract provisions or other applicable requirements may result in termination of the contract, the imposition of civil and criminal penalties against the Company, or the suspension or debarment of all or a part of the Company from federal government work, which could have a material adverse impact upon the Company's financial condition or earnings for one or more fiscal quarters or years. Among the reasons for debarment are violations of various statutes, including those related to employment practices, the protection of the environment, the accuracy of records and the recording of costs. Some state and local governments have similar suspension and debarment laws or regulations. Because of the high level of public awareness of environmental issues, companies in the enviItontny� service business, including the Company, may in the normal course of their business be expected periodic& become subject to judicial and administrative proceedings. Governmental agencies may seek to impose fines on the Company or revoke, deny renewal of, or modify the Company's operating permits or licenses. The Company is also subject to actions brought by private parties or special interest groups in connection with the permitting or licensing of its operations, alleging violations of such permits and licenses, or other matters. In addition, Waste Management International or their affiliates could cause a private or public entitincreasing governmental scrutiny of the environmental compliaAce records of the Company, CWM, WTI, Rust, y tal seeking environmen services to disqualify the Company from competing for one or more projects. on the ¢rounds that these records display inadequate attention to environmental compliance. Waste Services SOLID WASTE Operating permits are generally requ red at the state and local level for landfills. transfer stations and collection vehicles. Operating permits need to be renewed periodically and may be subject to revocation, modification, denial or non-renewal for various reasons, including failure of the Company to satisfy regulatory concerns. With respect to solid waste collection. regulation takes such formas as licensing of collection vehicles, truck safety requirements. vehicular weight limitations and, in certain focalities, limitations on rates, area, time and frequency of collection. With respect to solid waste disposal, regulation covers various matters, including landfill location and design, groundwater monitoring, gas control, liquid runoff and rodent, pest. litter and traffic control. Zoning and land use requirements and limitations are encountered in the solid waste collection, transfer, recycling and energy recovery and disposal phases of the Company's business. In almost all cases the Company is required to obtain conditional use permits or zoning law changes in order to develop transfer station, resourc> 17 recovery or disposal facilities. In addition, the Company's disposal facilities are subject to water and air pollution laws and regulations. Noise pollution laws and regulations may also affect the Company's operations. Governmental authorities have the power to enforce compliance with these various laws and regulations and violators are subject to injunctions, fines and revocation of permits. Private individuals may also have the right to sue to enforce compliance. Safety standards under the Occupational Safety and Health Act ("OSHA") are also applicable to the Company's solid waste and related services operations. The EPA and various states acting pursuant to EPA-delegated authority have promulgated rules pursuant to RCRA which serve as minimum requirements for land disposal of municipal wastes. The rules establish more stringent requirements than previously applied to the siting, construction, operation and closure of all but the smallest municipal waste landfill facilities. In certain cases, the failure of some states to adopt the federal requirements may increase costs to meet inconsistent federal and state laws applicable to the same facility. The Company does not believe that continued compliance with the more stringent minimum requirements will have a material adverse effect on the Company's operations. See also "RCRA" and "Superfund" below for additional regulatory information. In March 1996, the EPA issued regulations that require large, municipal solid waste landfills to install and monitor systems to collect and control landfill gas. The regulations apply to landfills that are designed to accommodate 2.5 million cubic meters or more of municipal solid waste and that accepted waste for disposal after November 8, 1987, regardless of whether the site is active or closed. The date by which each affected landfill must have such gas collection and control system depends on whether the landfill began operation before or after May 30, 1991. Landfills constructed, reconstructed, modified or first accepting waste after May 30, 1991 generally must have systems in place by late 1998. Older landfills generally will be regulated by the states and will be required to have landfill gas systems in place within approximately 30 months of EPA's approval of the state program Many state solid waste regulations already require collection and control systems. White the Company has not yet completed its study of the new regulations, compliance with them is not expected to have a material adverse effect on the Company. • HAZARDOUS WASTE "ic Waste Management and CWM are required to obtain federal, state, local and foreign governmental permits for their chemical waste treatment, storage and disposal facilities. Such permits are difficult to obtain, and in most instances extensive geological studies, tests and public hearings are: required before permits may be issued. Waste Management's and CWM's chemical waste treatment, storage and disposal facilities are also subject to sitine, zoning and land use restrictions, as well as to regulations lincluding certain requirements pursuant to federal statutes) which may govern operating procedures and water and air pollution, among other matters. In particular, Waste Management's and CWM's operations in the United States are subject to the Safe Drinking Water Act )which regulates deep well injection), TSCA (pursuant to which the EPA has promulgated regulations concerning the disposal of PCBs), the Clean Water Act (which regulates the discharge of pollutants into surface waters and sewers by municipal. industrial and other sources) and the Clean Air Act (which regulates emissions into the air of certain potentially harmful substances). In their transportation operations. Waste Management and CWM are subject to the jurisdiction of the Interstate Commerce Commission and regulated by the DOT and by regulatory agencies in each state. Employee satiety and health standards under OSHA are also applicable. Of Waste Management's and CWM's chemical waste treatment or disposal facilities in the United States. all but one have been,issued permits under RCRA. The facility without an RCRA permit continues to have interim status. A final permit is to be issued jointly by the authorized state, subject to EPA oversight. and by the EPA. The regulations governing issuance of permits contain detailed standards for hazardous waste facilities on matters such as waste analysis, security, inspections, training, preparedness and prevention, emergency procedures, reporting and recordkeeping. Once issued, a final permit has a maximum fixed term of 10 years, and such permits for land disposal facilities are required to be reviewed five years from the date of issuance. The issuing agency (either the EPA or an authorized state) may review or modify a permit at any time during its term. 18 \u0 Lu&"F611v wul.vLa W4l ,.nJ.. ulu....5"­ ruts — 1.11. .............. _- . ... ........ ..i.v.......b storage or or disposal facilities in substantial compliance with the applicable requirements promulgated pursuant to RCRA and expects that the facility with interim status ultimately can qualify to be issued a RCRA permit. It is possible, however, that the issuance or renewal of a permit could be made conditional upon the initiati- -n completion of modifications or corrective actions at facilities, which might involve substantial additional c.. al expenditures on the part of Waste Management or CWM. Although the Company is informed that Waste Aianagement and CWM anticipate the reauthorization of each permit at the end of its term if the f—yirI` operations are in compliance with applicable requirements, there can be no assurance that such will be L. .as The radioactive waste services of Chem-Nuclear are also subject to extensive governmental regulation. Due to the extensive geological and hydrological testing and environmental data required, and the complex politica environment, it is difficult to obtain permits for radioacdve waste disposal facilities. Various phases of Chem Nuclear's low-level radioactive waste management services are regulated by various state agencies, the Unim States Nuclear Regulatory Commission (the "NRC") and the DOT. Regulations applicable to Chem-Nuclear' operations include those dealing with packaging. handling, labeling and routing of radioactive materials, ant prescribe detailed safety and equipment standards and requirements for training, quality control and insurance among other matters. Employee safety and health standards under OSHA are also applicable. See also "RCRA" and "Superfund" below for additional regulatory information. Clean Energy, Clean Water and Related Services WTI's business activities are subject to environmental regulation under federal, state and local laws an regulations, including the Clean Air Act, the Clean Water Act and RCRA. The Company believes that WTI' business is conducted in an environmentally responsible manner in material compliance with applicable laws ac regulations.The Company does not anticipate that WTTs maintaining compliance with current requirements wt result in any material decrease in earnings. There can be no assurance, however, that such requirements will n change so as to require significant additional expenditures. In particular, pursuant to the Clean Air A Amendments of 1990 it is probable that the air pollution control systems at certain trash-to-energy I owned or operated by WTI's subsidiaries will be required to be modified by the end of the decade to comp with the more stringent regulations promulgated thereunder. Although the expenditures related to sur modifications, if required, will likely be significant, they are not expected to have a material adverse WTI's liquidity or results of operations because WTI has the right to pass on to the majority of long-term conte users of its facilities increased capital and operating costs resulting from changes in law. Tbere can be assurance, however, that in such event WTI would be able to recover, for each project, all such increased cos from its customers. Moreover, it is possible that future developments, such as increasingly strict requirements environmental laws, and enforcement policies thereunder, could affect the manner in which WTI operates projects and conducts its business. including the handling. processing or disposal of the wastes. by-products a residues generated thereby. WTI's energy facilities are also subject to the provisions of various energy-related laws and regulauc including the Public Utility Regulatory Policies Act of 1978 ("PURPA"). The ability of WT71's trash-to-ener and small power production facilities to sell power to electric utilities on advantageous terms and conditions a to avoid burdensome public utility regulation has historically depended, in part, upon the continuing applicabil of certain provisions of PURPA. which generally exempts WTI from state and federal regulatory control o electricity prices charged by, and the finances of. WTI and its energy-producing subsidiaries. While the ren changes in Congressional leadership may increase the likelihood of a repeal or modification of PURPA. it unlikely that such action would abrogate the lone-term contracts and orders pursuant to which most of WT existing projects sell electricity. Furthermore. the operations of WTI's trash-to-energy and other small po% facilities business is not expected to be materially and adversely affected if the various benefits of PUR2PA repealed or substantially reduced on a prospective basis. due to the passage of the Energy Policy Act of F ("EPACT"). EPACT created an alternative ownership mechanism by which independent power producers participate in the electricity generation indusm' without the burdens of traditional public utility regulatic 19 w Environmental and Infrastructure Engineering and Consulting Services The practice of engineering and architecture is regulated by state statutes. All states require engineers and architects to be registered by their respective state registration boards as a condition to offering or rendering • professional services. Many states also require companies offering or rendering professional services, such as Rust, to obtain certificates of authority. Rust's businesses are also subject to OSHA regulations and to NRC regulations concerning services provided to nuclear power plants. RCRA Pursuant to RCRA. the EPA has established and administers a comprehensive, "cradle-to-grave" system for the management of a wide range of industrial by-products and residues identified as "hazardous" wastes. States that have adopted hazardous waste management programs with standards at least as stringent as those promulgated by the EPA may be authorized by the EPA to administer their programs in lieu of RCRA. Under RCRA and federal transportation laws, a transporter must deliver hazardous waste in accordance with a manifest prepared by the generator of the waste and only to a treatment. storage or disposal facility having a RCRA permit or interim status under RCRA- Every facility that treats or disposes of hazardous wastes must obtain a RCRA permit from the EPA or an authorized state and must comply with certain operating standards. The RCRA permitting process involves applying for interim status and also for a final permit. Under RCRA and the implementing regulations, facilities which have obtained interim status are allowed to continue operating by complying with certain minimum standards pending issuance of a permit. RCRA also imposes restrictions on land disposal of certain hazardous wastes and prescribes standards for hazardous waste land disposal facilities. Under RCRA, land disposal of certain types of untreated hazardous wastes has been banned except where the EPA has determined that land disposal of such wastes and treatment residuals should be permitted. The disposal of liquids in hazardous waste land disposal facilities is also prohibited. .The EPA from time to time considers fundamental changes to its regulations under RCRA that could facilitate exemptions from hazardous waste management requirements, including policies and regulations that could implement the following changes: redefine the criteria for deternuning whether wastes are hazardous; prescribe treatment levels which, if achieved, could render wastes non-hazardous: encourage further recycling and waste minimization: reduce treatment requirements for certain wastes to encourage alternatives to incineration; establish new operating standards for combustion technologies. and indirectly encourage on-site remediation. To the extent such changes are adopted. they can be expected to adversely affect the demand for the Company's chemical waste management services. In this regard, the EPA has recently proposed regulations which would have the effect of reducing the volume of waste classified as hazardous for RCRA regulatory purposes. See "Regulation" above. In addition to the foregoing provisions. RCRA regulations require the Company to demonstrate financial responsibility for possible bodily injury and property damage to third parties caused by both sudden and nonsudden accidental occurrences. See "Insurance" below. Also. RCF:A regulations require the Company to provide financial assurance that funds will be available when needed for closure and post-closure care at its waste treatment, storage and disposal facilities, the costs of which could be substantial. Such regulations allow the financial assurance requirements to be satisfied by various means, including letters of credit, surety bonds, trust funds, a financial (net worth) test and a guarantee by a parent corporation. Under RCRA regulations, a company must pay the closure costs for a waste treatment. storage or disposal facility owned by it upon the closure of the facility and thereafter pay post-closure care costs. If such a facility is closed prior to its originally anticipated time, it is unlikely that sufficient funds will have been accrued over the life of the facility to fund such costs, and the owner of the facility could suffer a material adverse impact as a result. Consequently, it may be difficult to close such facilities to reduce operating costs at times when. as is currently the case in the hazardous waste services industry, excess treatment. storage or disposal capacity exists. 20 ,pt,...-- k-cooraula� •--• °vernment etw,,, •- ersons respou'. , •-- superrund provides for EP. s due federal g hazards or to order p arties involved in the ent. and authorize cost interpreted creating strict' into cite envimnrn acrual or potential environm spa se and other related substances have created for these Sn erfttnd has bee ase costs and damage to i rfund assigns liability dous substances. P respo on to do so. Supe •nation. other necessary ties(and`waste transportation transfer and disposal of such rlo%,a and r of waste disposal far. . at the time the hazardous generation. li bility for ccsa of remo ' o rotors at or 3oir• and several extends to owners and pe vvned or operated such facilites dour substance Liability rsons who ° osal or treatment of a hazardous such facilities fr^ natural resources. ed for disP who selected ability may t' Substances- vehicles) from w}luch a release occurs• arrange and waste transporterssubstances• were disposed. persons who ce to such a facility• to generators of such a law.For additional substances hazardous substance as well as action ordered under transportation of a>,o hazardous substances. dorm a removal orLegal Proceedings below treatment or dispo tails to efforts.In trebled if the responsible parry rfund liability see for the cleanup otential Supe v the federal government to Pay was authorized to a ortion concerning P fund to be used b, ear on of Superfund overnmena m3,=fi 514 bilk rfund created a revolving through the end l the g roved any 1996 Supe nd spending ent's 1995 fiscal year• ent had not app late 199p, federal Super overnrrr the federal government um of 55.1 billion.For the federal a of this repo maximum axrm was authorized- As of the date d revision of the SuPertund statute in 11�ruP Supspendingd spending authorization. tion an for allocating Supe and provisions overningft ted to consider re��g mechanisms s the statute's provisions g 'the U. S.Congress is expec the statute's ,Uy aherha to continue addition to possible changes m ss also will fund nt Congress may coni fes (such as RCRA)to it - possible that Conga examp der other sWn site-spm nsibility• up remedies. For standards issued un ties such as national or and extea seleecction of appropnate Ce on stringent technology to adept new apprcac,. affect the stringenrl ret re , Gil wastes or ficantl and the deg to which Permttec Sapo.fund s carte olicy changes could signi moval and treatment of remediential P at will be employed• noa ingress may eonsrrlc dards d other po go riot to a pan!'' tisk;;sed star '[laza �of remediation techniques that wastes.In anon caused P Company a� will be used for re of contamirr 0d= Of site : —ne�adon,the type d law for remediation ation ofbazthe Comp oc, waste management facilitrthe Superfun ediation oblig rind. revision°n of the liability i na°a i� w�ch could redu e theediatr obligations under Supe acquisition of a con jo it and$every 1y liable for rem alio currently aro Jointly b+� liability. land- performed and Related Services the general atti performed and Waste Dtanag operauons are sub3ect to lir: Irt/er; .ttional tate countries where the sm+'r�avc cement of app µ Le management Intemauon degree of local ental law regulations of a dwh co ort. in w \* :ons and directives. Th by national stay. A other environm EU" - and even within, the plannin= :uropean Union t . I veen. ties and re.:'.a;, .ch Naste ytanagt Europe. vanes substar iddiM to the staru environ ^Mations v of the c' '-nm`' to issue laws ane ,-rates. uCr -hies. man, i and continua has created a Eur 'ntemauo.r` The EU has isst vlanager. municipa .'r cl at cal data �e provinciai. cIuoers or ,e of environm' ,tat m .Rn®en ant of firn ation erates are vexing a bro, - ember stat a develOpm Intern d collating t�ntal p�� ves a.. covering s co nental prncll t. guu.- Fav ' acv responsible for motto, orrection of er. Envtronrrtentaa . stablished thzee a t, pct. passed in 198, e preventative a� European the teed for p t�et1993.Thr environ ' ' lavv' ability for environ+-. c^ ^ i in malcin^_ andrequ rod he P --er source: ,oned in L -� ' vf� h also inn' t:W0 l I. The Treaty on F"r^"'' ab Sevelor- and app11L---- the principle of ' strati n ,d inns applies plow;ion be fate environmental ,1 A new procedure for the adoption of waste management legislation (other than for proposals of a primarily fiscal nature) which it is predicted may result in the speedier implementation of EU waste laws. • The impact of current and future EU legislation will vary from country to country according to the degree to which existing national requirements already meet or fall short of the new EU standards and. in some jurisdictions, may require extensive public and private sector investment and the development and provision of the necessary technology, expertise, administrative procedures and regulatory structures. These extensive laws and regulations are continually evolving in response to technological advances and heightened public and political concern. Outside Europe. continuing industrialization, population expansion and urbanization have caused increased levels of pollution with all of the resultant social and economic implications. The desire to sustain economic growth and address historical pollution problems is being accompanied by investments in environmental infrastructure, particularly in Southeast Asia, and the introduction of regulatory standards to further control industrial activities. The Company believes that Waste Management International's business is conducted in material compliance with applicable laws and regulations and does not anticipate that maintaining such compliance will adversely affect the Company's financial position. There can be no assurance, however, that such requirements will not change so as to require significant additional expenditures or operating costs. Waste Management International operates facilities in Hong Kong which are owned by the Hong Kong government. Control of the Hong Kong government passes to the People's Republic of China in 1997. Waste Management International is unable to predict what impact, if any, this change will have on its operations in Hong Kong. COMPETMON • Waste Management encounters intense competition, primarily in the pricing and rendering of services,from various sources in all phases of its solid waste management and related operations. In the solid waste collection phase, competition is encountered, for the most part, from national, regional and local collection companies as well as from municipalities and counties (which, through use of tax revenues, may be able to provide such services at lower direct charges to the customer than can Waste Management) and some large commercial and industrial companies which handle their own waste collection. In the solid[ waste transfer, resource recovery and disposal phases of its operations, competition is encountered primarily from municipalities, counties, local governmental agencies, other national or regional waste management cornparues and certain large corporations not primarily involved in the solid waste management services business. The Company also encounters intense competition in pricing and rendering of services in its medical and infectious waste management, portable sanitation and street sweeping and parking lot cleaning services businesses from numerous large and small competitors. In its hazardous waste management operations. the Company encounters competition from a number of sources, including several national or regional firms specializing primarily in chemical waste management, local waste management concerns and, to a much greater extent. generators of chemical wastes which seek to reduce the volume of or otherwise process and dispose of such wastes themseles. The basis of competition is primarily technical expertise and the price, quality and reliability of service. Waste Nlana2ement International encounters intense competition from local companies and governmental entities in particular countries, as well as from maior international companies. Pricing, quality of service and type of equipment utilized are the primary methods of competition for collection services, and proximity of suitable treatment or disposal facilities. technical expertise, price, quality and rebabi iry of services are the primary methods of competition for treatment and disposal services. 22 A WTI experiences substantial competition in all aspects of its business. it competes with a large number of firms, both nationally and internationally, some of which may have substantially greater financial and technical resources than WTI. the principal competitive factors with respect to its project development activities include technological performance. service, technical know-how, price and performance guarantees. Competing for selection as a project developer may require commitment of substantial resources over a long period of rim► , without any certainty of being ultimately selected. Competition for attractive development opportunities intense, as there are a number of competitors in the industry interested in such opportunities. The service industries in which Rust competes are highly competitive. Rust encounters intense competition, primarily in pricing, quality and reliability of services from various sources in all aspects of its environmental and infrastructure engineering and consulting services operations. Pursuant to the Fust Amended and Restated Intemational Business Opportunities Agreement, dated January 1, 1993, by and among CWM, WTI, Waste Management International, Inc., Waste Management International, Rust and the Company (as amended. the "IBOA"), which agreement is also a successor to certain prior agreements among certain of the parties, each of CWb1, WTI, Rust and the Company has agreed that, until the later of July 1, '_'000 or the dare on which the Company ceases to beneficially own a majority of the outstanding voting equity interests of such subsidiary or ceases to beneficially own a majority of the outstanding voting equity interests of Waste Management International, and in each case no longer has an option to obtain such ownership, such subsidiary or the Company will not engage (except through Waste Management International) in waste management services, design, development, construction and operation of trash-to-energy facilities in Italy or Germany; collection, storage, processing, treaunent or disposal of hazardous wastes (including hazardous substance remediation services); or design, engineering and construction (where the customer is seeking third- party operation), operation and maintenance of water, wastewater and sewage treatment facilities (including facilities for treating hazardous waste streams whether or not the customer is seeking third-parry operation) outside North America (i.e., the United States, its territories and possessions, Canada and Mexico) (the "Waste Management International Allocated Activities"), except with respect to licensing of technology and minor interests of CWM. WTI or Rust in publicly held entities. WTI may engage outside North .America in the design, engineering, construction, operation and maintenance of chimneys and air pollution control facilities (the "WT Allocated Activities"). Rust may engage outside North America in activities relating to(i) architectural servit (ii) engineering and design services and procurement, construction and construction management services (including marine construction and dredging), other than those relating to the Waste Management International Allocated Activities and the WTI Allocated Activities. (iii) scaffolding services, (iv) demolition and dismantling services, (v) environmental consulting services, and (vi) industrial facility and power plant maintenance services (the "Rust Allocated Activities"). Sales by the Company of recyclables, licensing of technology and minor investments by the Company in publicly held entities are also permitted activities of the Company outside North America. Waste Management International has agreed that for the same time periods as are applicable to CWM, WTI, Rust and the Company above in this paragraph, it will not engage in North America in the type of activities included within the Waste Management International .-Uocated Activities outside North .America and will not engage in the WTI Allocated Activities or the Rust Allocated Activities. Businesses or assets acquired by a parry to the BOA which are in the domain of another pary thereto (according to the allocations described above) must be offered for sale to the other parr at fair market value. In addition. WTI and Waste Management International have entered into an agreement whereby WTI will have primary responsibility for the early-stage development of trash-to-energy projects outside North America (except in Italy and Getmanv) and Waste Management International will have the right to acquire up to 4970 of all equity of any such project available to Waste Management International. V777I and their affiliates, with WTI or other investors owning the balance. This arrangement is non-cancellable by \VTI or Waste Management International without the other's consent prior to 2000. If the arrangement is cancelled, the right to develop trash- to-energy projects reverts to being part of the Waste Management International Allocated Activities. By agreement among the parties. the Company is responsible for determining business allocations among CWIv1, %Vn. Rust, the Company and Waste Management International which are not controlled by the _3 allocations set forth in the preceding two paragraphs- In this connection CWM. W 1'I, Rust, the Company and Waste Management International have agreed that in order to minimize the potential for conflicts of interest among various subsidiaries under the common control of the Company and for so long as the Company shall • have beneficial ownership of a majority of the outstanding voting equixy interests of such subsidiary(or an option to obtain such ownership), the Company has the right to direct future business opportunities to the Company or the Company-controlled subsidiary which, in the Company's reasonable and good faith judgment. has the most experience and expertise in that line of business, provided that the Company may not allocate a business opportunity to a particular subsidiary if such business opportunity would involve the subsidiary in a breach of its agreement not to compete as described in the immediately preceding paragraphs. Opportunities outside North America relating to the provision of future waste management services are generally to be allocated to Waste Management International, except that opportunities outside North America relating to the WTI Allocated Activities and the Rust Allocated Activities are generally to be allocated to WTI and Rust, as the case may be. Environmental opportunities other than waste management activities are to be allocated in the Company's good faith judgment. No party.is liable for consequential damages, except for lost profits, for any breach of the MOA. In addition, in connection with the transfer by Rust of its hazartious and radioactive substance remediation business (see "Acquisitions and Dispositions" below), the Company, Rust and their respective wholly owned affiliates agreed with OHM not to engage in providing on-site hazardous and radioactive substance remediation services in North America prior to 2002. INSURANCE While the Company believes it operates professionally and prudently, its business exposes it to risks such as the potential for harmful substances escaping into the environment and causing damage or injuries, the cost of which could be substantial.The Company currently maintains Liability insurance coverage for occurrences under various environmental impairment, primary casualty and excess liability insurance policies. • The Company's insurance program includes coverage for pollution liability resulting from "sudden and accidental" releases of contaminants and pollutants- The Company believes that the coverage terms, available limits of liability, and costs currently offered by the insurance market do not represent sufficient value to warrant the purchase of "non-sudden and accidental" pollution liability insurance coverage. As such, the Company has chosen not to purchase risk transfer "non-sudden and accidental" pollution liability insurance coverage. To satisfy existing government requirements, the Company has secured non-risk transfer pollution liability insurance coverage in amounts believed to be in compliance with federal and state law requirements for "non-sudden and accidental" pollution.The Company must reimburse the insurer for-losses incurred and covered by this insurance policy. In the event the Company continues not to purchase risk transfer "non-sudden and accidental" pollution liability insurance coverage, the Company's net income could be adversely affected in the future if "non-sudden and accidental" pollution losses should occur. EMPLOYEES WMX Technologies and its subsidiaries employ a total of approximately 73.200 persons in their worldwide continuing operations. Of this number, the Company employs approximately 38,700 persons in its North American solid and hazardous waste management services operations (excluding employees of the Rust scaffolding and other on-site industrial services business operated by Waste Management). Of this total, 35,900 persons are engaged in its Waste Management solid waste and related services operations, including approximately 37,200 persons employed in solid waste collection. transfer, resource recovery and disposal activities, and approximately 8,700 managerial, executive, sales, clerical, data processing and other solid waste and related activities. Approximately 2,800 employees are employed in the Company's hazardous waste services business, including 100 as managers or executives. Approximately 2.000 are employed in hazardous waste treatment, storage and disposal activities (including approximately 530 performing technical. analytical or • engineering services u, and approximately 700 are employed in sales. clerical. data processing and other hazardous waste-related activities. 24 A As of December 31, 1995. Waste tilanagement International emploved approximately 13.500 persons. Of this number, approximately 14,900 persons were employed in its coilecuon services operations. 2.400 in its treatment and disposal services operations and 1,200 in administrative functions. At December 31, 1995, WTI had approximately 4,600 full-time employees. Rust employed approximately 11,400 persons at December 31, 1995 (excluding its process engineering construction. specialty contracting and related services business which is to be sold or otherwise discontinued. but iaauding the scaffolding and other on-site industriz. serves business managed by Waste Management), of whom approximately 4,200 provided technical or engineering services (excluding craft personnel hired on a temporary basis). At December 31, 1995, approximately 6,900 of the Company's employees in North America were unionized, primarily in the Company's solid waste and related services operations, under collective bargaining agreements expiring on various dates through 2002. At December 31, 1995, approximately 13,900 Waste Management International employees were represented by labor unions. The Company believes its employee relations are acceptable. ACQUISITIONS AND DISPOSITIONS Since August 1971, the Company has acquired a number of companies, and certain assets of other companies, engaged in various phases of the environmental services industry. See Note 4 to the Company's Consolidated Financial Statements filed as an exhibit to this report and incorporated herein by reference. The amounts and types of consideration generally have been determined by direct negotiations with the owners of the businesses acquired. In most instances, the owners of the acquired businesses were few in number. and often certain key former owners have continued to operate the businesses following acquisition by the Company. During 1995, the Company continued to acquire additional operations in the environmental services industry. Acquisitions have bisterically contributed significantly to the Company's growth. However, in recent years the Company's acquisition activity relative to the size of its revenue base has decreased The Company's B~ prospects may be affected by the availability of additional business acquisitions at reasonable prices an- Company's ability to finance such acquisitions. See "Management's Discussion and Analysis of Results of Operations and Financial Condition" filed as an exhibit to this report and incorporated herein by reference for a discussion of capital expenditures by the Company, including acquisitions. Other well-capitalized companies also compete intensely for businesses available to be acquired The Company is continually engaged in the process of considering and negotiating additional acquisitions. Some future acquisitions could be material. The acquisition of businesses also entails certain inherent risks. Although the Company reviews businesses to be acquired, because of the nature of the liabilities involved in these businesses, there can be liabilities which will not become known until after the transactions are consummated. The Company seeks to minimize the impact of these liabilities and expenditures by obtaining indemnities and warranties from the seller which may be supported by deferring payment of a portion of the purchase price. These indemnities and warranties. if obtained. may not. however, fully cover the liabilities due to their limited scope, amount, or duration, the financial limitations of the indemnitor or warrantor, or other reasons. Businesses purchased may require expenditures to make up for deferred maintenance and to improve the quality or quantity of assets acquired. In certain cases, the Company establishes reserves in respect of the anticipated costs of remediation for acquired sites. On January%24. 1995, the Company acquired CWhI common stock representing the approximately 21`2 interest in CWM held at that time by public stockholders. The acquisition occurred pursuant to a merger (the "Merger") in which all publicly held shares of CWM common stock were converted into convertible subordinated notes of the Company due January 24, 2005 and having a principal amount at matunty of 51.000 per note (the ''Notes"), subject to the payment of cash in lieu of the issuance of fractional Notes. For a description of the terms of the Notes, see Note 5 to the Company's Consolidated Financial Statements incorporated herein by reference. The Merger was approved by a committee of independent directors of CWL_\l 25 R and by a majority of the public stockholders of CWtAi. As a result of the Merger. CWM became a wholly owned subsidiary of the Company. On March 14, 1995, the Company's Board of Directors approved a plan to reduce the scope of the • Company's chemical waste management services business by selling or otherwise eliminating technologies and service locations which were not meeting customer service or performance objectives. See "Management's Discussion and Analysis of Results of Operations and Financial Condition-1995 Operations Compared with 1994--CWM," incorporated by reference in this report, for further information. In May 1995, OHM acquired Rust's hazardous and radioactive substance remediation business in exchange for an approximately 37% interest in OHM. In exchange for warrants to acquire an additional approximately 2.6% of OHM common stock, the Company also agreed in that transaction to guarantee up to $62 million of indebtedness of OHM. In July 1995, the Company acquired the approximately 4% of Rust's shares held by the public for $16.35 per share in cash. The transaction was approved by a special committee of independent directors appointed by the Rust Board of Directors. As a result of that transaction, Rust became owned 60% by the Company and 40% by WTI. Additionally, Rust hai announced its intention to sell or otherwise discontinue its process engineering, construction, specialty contracting and related services business. The terms of the sale have not yet been determined.The Company expects the sale of those portions of the business which are to be sold to be completed in 1996. In December 1995, the Company contributed its approximately 28% interest in ServiceMaster Consumer Services LP. ("SMCS"), a provider of Iawncare, pest control and other consumer services, to ServiceMaster LP. ("SMLP"), the owner of the remaining interest in SMCS, in exchange for an approximately 19% interest in SMI.P and an option to purchase up to 1.2.5 trillion SM[IP limited parWe ship shares. 'The Company has also acquired numerous companies and interests in companies internationally through Waste Management International or its predecessors. See "International Waste '.Management and Related Services." ITEM 2. PROPERTIES. The principal property and equipment of the Company consists ofland (primarily disposal sites), buildings and waste treatment or processing facilities (other than disposal sites), and vehicles and equipment, which as of December 31, 1995 represented approximately 18%, 6% and 27%. respectively, of the Company's total consolidated assets. The Company believes that its vehicles. equipment and operating pmperties are well maintained and suitable for its current operations. See "Management's EHscussion and Analysis of Results of Operations and Financial Condition" filed as an exhibit to this report and incorporated by reference herein for a discussion of property and equipment expenditures by the Company for the: last three years and the capital budget for 1996. The Company's subsidiaries lease numerous office and operating facilities throughout the world. For the year ended December 31, 1995, aggregate annual rental payments on rxal estate teased by the Company and its subsidiaries approximated $140,367,000. I The principal fixed assets of Waste !Management consist of vehicles and equipment (which include, among other items, approximately 20.800 collection and transfer vehicles. 1.568.600 containers and 21.000 stationary compactors in the United States and Canada). Waste Management owns or leases real property in most states and Canadian provinces in which it is doing business. At December 31. 1995, 103 solid waste disposal facilities. aggregating approximately 65,740 total acres, including approximately 14.290 permitted acres, were owned by Waste Management in the United States and Canada and 30 facilities, aggregating approximately 13,340 total • acres, including approximately 5,860 permitted acres, were leased from parties not affiliated with Waste 26 Is Management under leases expiring i.om 1996 to '085. At December 31, 1995, the Companv owned or leased.i. the United States a total of nine treatment, storage or disposal facilities. At such date, the Company's sever. chemical waste facilities with secure land disposal sites aggregated approximately 7,865 acres. including approximately ppximately 1.470 permitted acres. The principal property and equipment of Waste Management International consist of land (pn,.- .,y disposal sites) and vehicles and equipment, which as of December 3I, 1995 represented approximately 13.1 and 30.3%. respectively, of NVaste Management lrr.:nauonai's assets. The principal fixed assets utilized in F: Mane. _trent International's collection services operations at December 31, 1995 consisted of vehicles and equipment (which included, among other items, approximately 7,000 collection, transportation, and other route vehicles and approximately 300 pieces of landfill and other heavy equipment), and approximately 285,000 containers, including approximately 3.550 stationary compactors. In addition. Waste Management latemationai owns approximately 710 pieces of hazardous waste equipment, consisting predominately of containers and collection vehicles. The principal fixed assets utilized in Waste Management International's treatment and disposal services operations at December 31, 1995 consisted of 55 landfills, 23 waste treatment facilities, 79 recycling and recyclables processing facilities, trine incinerators and various other manufacturing, office and warehouse facilities owned, leased or operated by Waste Management International. WTI currently owns, operates or leases 16 trash-to-energy facilities, seven cogeneration and small power production facilities, two coal handling facilities, five biosoiids drying, pelletizing and composting facilities, one wastewater treatment plant and various other manufacturing, office and warehouse facilities. Facilities leased or operated (but not owned) by WTI are under leases or agreements having terms expiring from the years 1996 to 2020• subject to renewal options in certain cases. The principal property and equipment of Rust consist of the vehicles, equipment and scaffolding inventory used in the scaffolding and other on-site industrial services business managed by Waste Management, which as of December 31, 1995 represented approximately 14% of Rust's total continuing consolidated assets. Rust believes that its equipment is well maintained and suitable for its cw=nt operations. Rust leases its corRkr2te offices in Greenville, South Carolina and Birmingham.Alabama and numerous office, warehouse and equ and scaffolding yard facilities in various locations throughout the United States. ITEM 3. LEGAL PROCEEDINGS. Some of the businesses in which the Company is engaged are intrinsically connected with the protection of the environment and the potential for the unintended or unpettrutzed discharge of materials into the environment. In the ordinary course of conducting its business activities. the Company becomes involved in judicial and administrative proceedings involving governmental authorities at the federal, state and local level including, in certain instances, proceedings instituted by citizens or focal governmental authorities seeking to overturn governmental action where governmental officials or agencies are named as defendants together with the Company or one or more of its subsidiaries, or both. In the majority of the situations where proceedings are commenced by governmental authorities, the matters involved relate to alleged technical violations of licenses or permits pursuant to which the Company operates or is seeking to operate or laws or regulations to which its operations are subject or are the result of different interpretations of the applicable requirements. From time to time the Company pays fines or penalties in environmental proceedings relating primarily to waste treatment, storage or disposal facilities. At December 31, 1995, a Company subsidiary engaged in providing hazardous waste management services was involved in one such governmental proceeding and a subsidiary of WT1 was involved in one such proceeding where it is believed that sanctions involved in each instance may exceed $100,000. The Company or certain of its subsidiaries have been idennfied as potentially responsible parties in a number of governmental investigations and actions relating to waste disposal facilities which may be subject to remedial action under Superfund. The majority of these proceedings are based on allegations that test; 2-7 w subsidiaries of the Company (or their predecessors) transported hazardous substances to the facilities inquestion. often prior to acquisition of such subsidiaries by the Company. Such proceedings arising under Superfund typically involve numerous waste generators and other waste transpormuon and disposal companies and seek to • allocate or recover costs associated with.site investigation and cleanup, which costs could be substantial. As of December 31, 1995, the Company or its subsidiaries had been notified that they are potentially responsible parties in connection with 106 locations listed on the Superfund National Priority List ("NPL"). Of the 106 NPL sites at which claims have been made against the Company, 19 are sites which the Company has come to own over time. All of the NPL sites owned by the Company were initially sited by others as land disposal facilities. At each of the 19 owned facilities, the Company is working in conjunction with the government to characterize or to remediate identified site problems. In addition, at these 19 facilities the Company has either agreed with other legally liable parties on an arrangement for sharing the costs of remediation or is pursuing resolution of an allocation formula.The 87 NPL sites at which claims have been made against the Company and which are not owned by the Company are at different procedural stages under Superfund. At some, the Company's liability is well defined as a consequence of a governmental decision as to the appropriate remedy and an agreement among liable parties as to the share each will pay for implementing that remedy. At others, where no remedy has been selected or the liable parties have been unable to agree on an appropriate allocation, the Company's future costs are substantially uncertain. The Company periodically reviews its role, if any, with respect to each such location, giving consideration to the nature of the Company's alleged connection to the location(e.g.,owner, operator,transporter or generator), the extent of the Company's alleged connection to the location (e.g., amount and nature of waste hauled to the location, number of years of site operation by the Company or other relevant factors), the accuracy and strength of evidence connecting the Company to the location.the number,connection and financial ability of other named and unnamed potentially responsible parties at the location, and the nature and estimated cost of the likely remedy. Where the Company concludes that it is probable that a liability has been incurred. a provision is made in the Company's financial statements for the Company's best estimate of the liability based on management's judgment and experience, information available from regulatory agencies and the number, financial resources and relative degree of responsibility of other potentially responsible parties who are jointly and severally liable for remediation of a specific site, as well as the typical allocation of costs among such parties. If a range of possible outcomes is estimated and no amount within the range appears to be a better estimate than any other, then the Company provides for the minimum amount within the range, is accordance with generally accepted accounting principles. Sites subject to state action under state laws similar to the federal Superfund statute are treated by the Company in the same way as NPL sites. The Company's estimates are subsequently revised. as deemed necessary, as additional information becomes available. While the Company does not anucipate that the amount of any such revisions will have a material adverse effect on the Company's operations or financial condition, the measurement of environmental Liabilities is inherently difficult and the possibility remains that technological, regulatory or enforcement developments, the results of environmental studies, or other factors could materially alter this expectation at any time. Such matters could have a material adverse impact on earnings for one or more fiscal quarters or years. From time to time, the Company and certain of its subsidiaries are named as defendants in personal injury and property damage lawsuits. including purported class actions, on the basis of a Company subsidiary's having owned. operated or transported waste to a disposal facility which is alleged to have contaminated the environment or, in certain cases, conducted environmental remediation activities at sites. Some of such lawsuits may seek to have the Company or its subsidiaries pay the costs of groundwater monitoring and health care examinations of allegedly affected persons for a substantial period of time even where no actual damage is proven. While the Company believes it has mentorious defenses to these lawsuits. their ultimate resolution is often substantially uncertain due to the difficulty of determining the cause. extent and impact of alleged contamination (which may have occurred over a long period of time). the potential for successive groups of • complainants to emerge, the diversity of the individual plaintiffs' circurnstances. and the potential contribution or indemnification obligations of co-defendants or other third parues. .antong other factors. Accordingly, it is 28 JC,e Ucn niatidtS :ould dale ;! quarters or material adverse impact on the Com � years' Parry's timings.for one or more Pis, A subsidiary of the Company has been which restricted the height of its News involved in litigation challenging previously issued b Milford, Connecticut landfill to a level below that allmunicipal ed by 0 had declared Y the COnnecncut Department of Environmental Protection teat allowed by rr the Zoning ordinance's height limitation unconstitutional, l DEP �• Although that ruling and remanded the case for further the Connecticut alowerCOL Litchfield. On November 8. 1995, the Superior Cotorderes in the tie Com Supreme Court reverse rt Superior Court the judicial district permission to remove all waste above the height allowed by the zoning removal of such winappropriate Parry's ante nary to apply to the DEP fc Connecticut Supreme Court. na�prri nenremed B ordinance• The Com Y and its subsidiary has appealed the Su Pant believes th, that may ultimatelyCompany is unable to predict the outcome of the appeal Corer order c o the lower court order as toured full o the further appeals or as a result of the Plxal or any removal actio; which could vary significantly depending este is not modified, the subsidiary Process. However, i regulatory authorities for remdepoving upon the nature of anv plan which is�cid recur substantia( veru unforeseeable factors and w g the `waste, the actual volume of waste to y approved by aPP(icablc results of o loch could have a material adverse effect on the Com moved and other c Aerations in one or more future uremth periods. Aerial's financial condition ane The Company and certain of its subsidiaries governmental proceedings relating to the conduct of their businecurrently(e volved me o of or governmental investigation c re also Precivil litigation and not have a material adverse effect cannot ntits results of t� Ce�nrv' the Com anv �y Pkv°lar lawsuit Aerations or financial condition.�eves that these matters will The Company has brought sunt against a substantial number of ins Management, Inc. et al. v. The Admiral Insurance Company, et al. Pentium carriers County, New Jerse man action entitled Waste asserted against the Company action the Company is seeking a declaratoryg the Superior court Parry or its subsidiaries, or that may be Judgment that en ll Hudson policies purchased b y asserted in the fu , „ vulonmenta! liabilities and other Y the Company or its subsidiaries. The Company �' arre covered by insara damages incurred as a result of the assertion of envirco is also seeking to recover subsidiaries for events occurringnmental liabilities a defense"'' over at least the last 75 years atapproximatelygait the Company insurance carriers' denial of coverage of such liabilities. The defendants have dewed liabilitys and P Y tits and have asserted various defenses, includingdefendant seeking relief are not risks covered b that environmental liabilities of the to the Company claims vigorously. Discovery Y the at policies in question. The defendanu nice the Company is Years No trial daze has been set (hveComunderway in this Proceeding are contestin these g and is expected to continue for�e several No amounts have been recognized in the Com y is unable at thr� time to predict the ou[come of Company's financial statements for any this Proceeding. future recoveries. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. No matters were submitted to the Companv•s security holden during the fourth quarter of 1995. EXECUTIVE OFFICERS OF THE REGISTRANT Set forth below are the names and ages of the Companv's executive officers (as defined by re the Securities and Exchange Co[nnussion), the positions they hold with the Company and ;❑ business experience. Executive officers are a regulations of Board. elected by the Board of Directors and rete at tt a muriates of their ` discretion of the Dean L. Buntrock, age 64, has been a director of the Com and Chief Executive Officer of the Company since 1968. From Sep ember 1980 to November 1984, served as President. NIr. Buntrock is also a director of party and has served t as Chairman of the Board Chicken, Inc. STI, Waste Management International and Boston he also _9 Herbert A. Getz, age 40,has been a Senior Vice President of the Company since May 1995, a Vice President of the Company since May 1990 and General Counsel since August 1992. He has also been Secretary of the Company since January 1988. He also served as Assistant General Counsel of the Company from December • 1985 until August 1992. Mr. Getz has also held the offices of Vice President. General Counsel and Secretary at Waste :Management from April 1989 until December 1993, and Vice President and Secretary of Rust from January 1993 to May 1994. He has also served as Secretary of WTI since July 1995, a position he previously held. as well as being the General Counsel of WTh from November 1990 until May 1993. Mr. Getz commenced employment with the Company in 1983. He is Chairman of the Board of Directors of NSC and a director of OHM. Thomas C. Hau, age 60, has been a Vice President and the Controller and Principal Accounting Officer of the Company since he commenced employment with the Company in September 1990. From 1971 until his employment by the Company, Mr. Hau was a partner of Arthur Andersen LLP. William P. Hulligan. age 52, has been Executive Vice President of Waste Management since January 1996, a position he previously held from September 1984 to January 1988. From 1986 to August 1993, he was also a Vice President of the Company. From August 1992 to March 1996, he also served as President of certain Waste Management operating groups. He was President of Waste Management from January 1988 to August 1992. He has been employed by the Company since 1979. Joseph M. Holsten, age 43, has been Chief Executive Officer of Waste Management International since July 1995. From October 1993 to July 1995, he was Executive Vice President and Chief Financial Officer of Waste Management. Mr. Holsten was Vice President of Acquisitions and Project Development for Waste Management International from April 1992 to August 1993 and Vice President, Chief Financial Officer and Treasurer of Rust from September to October 1993. Mr. Holsten has been employed by the Company since 1981. • James E. Koenig, age 48, has been a Senior Vice President of the Company since May 1992, Treasurer of the Company since 1986 and its Chief Financial Officer since 1989. Mr. Koenig fust became a Vice President of the Company in 1986. From 1984 to 1986, Mr. Koenig was Staff Vice President and Assistant to the Chief Financial Officer of the Company. Mr. Koenig has been employed by the Company since 1977. Mr. Koenig also served as Vice President, Chief Financial Officer and Treasurer of WTI from November 1990 to May 1993. He also serves as a director of WTI, Waste Management International and OHM. D. P. Payne, age 53. has been a Senior Vice President of the Company since April 1995, a position he previously held from 1990 to 1993. He also served as President and Chief Executive Officer and a director of CW'iM from September 1991 to March 1995. fir. Payne has been employed by the Company since 1990. Phillip B. Rooney, age 51, has served as a director of the Company since 1981 and as its President and Chief Operating Officer since November 1984. Since January 1994, he has also served as Chairman of the Board and Chief Executive Officer of Waste Management. Mr. Rooney commenced employment with the Company in 1969 and first became an officer of the Company in 1971. Since November 1990, he has served as Chairman of the Board and Chief Ececuuve Officer of W-n. Mr. Rooney is also a director of Waste Management International, WTI, Illinois Tool Works. Inc.. Caremark International Inc.. Urban Shopping Centers. Inc., and ServiceMaster Management Corporation, the general partner of ServiceMaster Limited Partnership. Donald A. Wallgren. age 54. has been Vice President and Chief Er,cironmental Officer of the Company since 1992 and Vice President of Environmental Management of Waste Management since January 1995. He was Vice President and Chief Environmental Officer at Waste Management from 1989 to May 1990. From 1990 • to 1992, he served as Vice President-Recycling. Development and Environmental Management of Waste Management. Mr. Wallgren has been employed by the Company since 1,9 9. 30 STOCKHOLDER SLITTERS. The Company's common stock is traded on the New York Stock Exchange and the Chicago Stoc_ .ci under the symbol "WMX." The following table sets forth by quarter for the last two years the high anc sale prices of the Company's common stock on the New York Stock Exchange Composite Tape as r the Dow Jones News Retrieval Service, and the dividends declared by the Board of Directors of the on its common stock. 1994 Quarterly Summary Cash Dividends ®qh law Declared Per Share Fust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $303/4 $23 S.15 Second . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293A 225A .15 Third. . . . . _. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 303k 2635 .15 Fourth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 241`2 .15 1995 Quarterly Summary Cash Dividends With taw Declared Per Share Fust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $295A $253/4 $15 Second . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 283'4 263/4 .15 Third. . ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3212 2814 .15 Fourth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 307A 263`3 .15 At March 20, 1996, the Company had approximately 55,600 stockholders of record. Due in part to the high level of public awareness of the business in which the Company is en regulatory enforcement proceedings or other unfavorable developments involving the Company's operat facilities, including those in the ordinary course of business, may be expected to engender substantial nu which could from time to time have an adverse impact upon the market price for the Company's c From September 1990 to December 1995, WMX Technologies maintained a program for the purcf up to 25,000,000 shares of its common stock from time to'time in the open market or in privately neg transactions. During 1992 and 1993 the Company purchased approximately 7,600,000 shares and 8,4 shares, respectively, of its common stock under this program. No Company shares were repurchased in 1 1995. In December 1995, the Company terminated that program and announced that its Board of Direct authorized the repurchase by the Company of up to an additional 25,000,000 shares of the Company's cc stock from time to time over the following 24-month period in open market or privately negotiated trans. During 1994 and 1995. the Company sold put options on 31,600.000 shares of its common s conjunction with the repurchase program. The put options give the holders the right at maturity to reqs Company to repurchase its shares at specified prices. In the event the options are exercised, the Compa: elect to pay the holder in cash the difference between the strike price and the market price of the Cor. shares, in lieu of repurchasing the stock. Options on 17.900.000 shares expired unexercised in 1994 and l the price of the Company's stock was in excess of the strike price at maturity. Options on 4,700,000 share exercised in February 1995, and the Company elected to settle them for cash in the amount of$12,019.Ot remaining 9.000.000 options expire at various dates in 1996 at strike prices ranging from $27.34 to $31 share. For additional information. see ''Management's Discussion and Analysis of Results of Operati, Financial Condition-Capital Structure'' incorporated by reference herein. 31 ITEM 6. SELECTED MANCIAL DATA. The following selected consolidated financial information for each of the five years in the period ended • December 31. 1995 is derived from the Company's Consolidated Financial :statements, which have been audited by Arthur Andersen LLP. independent public accountants. whose report thereon is incorporated by reference in this report. The information below should be read in conjunction with "Management's Discussion and Analysis of Results of Operations and Financial Condition" and the Company's Consolidated Financial Statements. and the related Notes. and the other financial information which are filed as exhibits to this report and incorporated herein by reference. Year Ended December 31, MIM 1992(21 1993(3)(6) 199414)(6) 1995(51(61 (000's omitted.except per share amounts) Revenue from continuing operations . S 7,550,914 S 8,661.027 S 8,636,116 S 9,554.705 S10,247.617 Income from continuing operations . . S 606,323 S 850,036 S -142.431 S 776,491 S 654.590 Earnings per common and common equivalent share—continuing operations . . . . . . . . . . . . . . . . S 1.23 S 1.72 S .91 S 1.60 S 1.35 Total assets . . . . . . . . . . . . . . . . . . . 512.572,310 514,114.180 516.264,476 517,423.173 518.695.308 Long-term debt, less portion payable within one tear. . . . . . . . . . . . . . . S 3,782,973 S 4.312.511 S 6,1.15,584 S 6.044,411 S 6,420.610 Dividends per share . . . . . . . . . . . . . S .4'2 5 .50 S .58 S .60 S .60 (1) The results for 1991 include a special charge of 5296.000.000 (before tax and minority interest) primarily to reflect then current estimates of the environmental remediation liabilities at waste disposal sites previously used or operated by the Company and its subsidiaries or their predecessors. (2) The results for 1992 include a non-taxable gain of 5240.000.000 (before minority interest) resulting from • the initial public offering of Waste Management International, special charges of 5219,900,000 (before tax and minority interest) primarily related to writedowns of the Company's medical waste business. CWN1 incinerators in Chicago, Illinois and Tijuana. Mexico and a former subsidiary's investment in its asbestos abatement business and certain restructuring costs incurred by the subsidiary and CWDt related to the formation of Rust. and one time after-tax charges aggregating 571.139.000, or $.14 per share. related to the cumulative effect of adopting two new accounting standards. (3) The results for 1993 include a non-taxable gain of 515.109.000 (before minority interesti relating to the issuance of shares by Rust, as well as the Company's share of a special asset revaluation and restructuring charge of 5550.000.000 (before tax and minority interesn recorded by CWM related primarily to a revaluation of CWM's thermal treatment business. and a provision of approximately 514.000.000 to adjust deferred income taxes resulting from the 1993 tax law change. See Votes 3 and 14 to the Company's Consolidated Financial Statements. (4) The results for 1994 include a charge of 59,200-000 (before tax and minonty interest) recorded by Rust to write off assets and recognize costs of exiting certain of Rust's service lines and closing offices in a consolidation of certain of its operating groups. See Vote 11 to the Company's Consolidated Financial Statements. (5) The results for 1995 include a special charge of SI10.600.000 (before taxi recorded by CWM, primarily to write ort its investment in facilities and technologies that it abandoned because they do not meet customer service or performance objectives, and a special charge of 5194.600.000 (before tax and minority interest) recorded by %Vaste Management lnternationai relating ro actions it is taking to sell or otherwise dispose of non-core businesses and investments, as well as core businesses and investments in low potential markets. abandon certain hazardous waste treatment and processing technologies. and streamline its county management organization. See Vote 14 to the Compant s Consolidated Financial Statements. • (6) 1n December 1995, the Rust Board of Directors approved a Dian to sell or otherwise discontinue Rust's process engineering. construction. >pecialty :ontracticc and similar i.nes of business. Accordinglc. :hese casmesses hate been s.cregatea as ilscOntlnued operations in the financial statements ;ince 1993. :: is not practical to restate periods prior to the formation of Rust on January 1. 1993 for the discontinued oper_uons. See Note 15 to the Company's Consolidated Financial Statements. (7) Ce.-rain amounts have been restated to conform to 1995 classifications. Reference is made to the ratio of earnings to fixed charges for each of the years in the five-year pe,., d ended December 31, 1995, as set forth in Exhibit 12 to this report, which ratios are incorporated herein by reference. rMM 7. NIANAGENIENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS A-ND FINANCIAL CONDITION. Reference is made to Management's Discussion and Analvsis of Results of Operations and Financial Condition set forth on pages 16 to 24 of the Companv's 1995 Annual Report to Stockholders (the "Annual Report"), which discussion is filed as an exhibit to this report and incorporated herein by reference. ITEM 8. FINANCIAL STATENIENTS AND SUPPLEMENTARY DATA. (a) The Consolidated Balance Sheets as of December 31, 1994 and 1995, Consolidated Statements of Income. Stockholders' Equity and Cash Flows for each of the years in the three-year period ended December 31. 1995 and Notes to Consolidated Financial Statements set forth on pages 25 to 45 of the Annual Report are filed as an exhibit to this report and incorporated herein by reference. (b) Selected Quarterly Financial Data ilinaudited) is set forth in Note 17 to the Co Statements referred to in Item 8(a) above and incorporated herein by reference. nsolidated Financial ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AIND FINANCIAL DISCLOSURE. None. PART III ITEM 10. DIRECTORS AND EXECUTI--E OFFICERS OF JHE REGISTRANT. Reference is made to the information set forth in the 15 paragraphs under the caption Election of Directors" beginning on page I of the Company's proxy statement for the annual meeting scheduled for '.tay 10. 1996 ithe "Proxy Statement for a description of the directors of a e Company. Ahich paragraphs are incorporated herein b% reference. Informauon concerning the executive officers of the Co under "Executive Officers of the Registrant. mpam is set forth acoce" ITEM 11. EXECUTIVE COMPENSATION. Reference is made to the information set forth under the caption ''Compensation'' on pages 10 throu_n !6 of the Proxy' Statement '.yhich information, is incorporated herein by reference. ITEM 12. SECURITI, OWNERSHIP OF CERTAIN BENEFICIAL O«1'ERS AND MANAGEMENT. Reference is made to the tnforrnat:on, including Lhe tables and the �otnotes thereto, set forth under tie caption 'Securities Ownership of Management" on pages = through 9' :,f the Proxy Statement, for ce.^.a n information respecting ownership of common stock of thz Compans «TI .d Waste Management Intemapec_i. which information is incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. Reference is made to the paragraph under the caption "Compensation Committee Interlocks and Insider Participation'- on rage 16 of the Proxy Statement and the information set forth under the caption "Certain • r'ransactions" beginning on page 24 of the Proxy Statement for certain information with respect to certain relationships and related transactions, which paragraphs are incorporated herein by reference. PART IV ITEM 14. EXHIBITS. FLVANCIAL STATEMENTS, SCHEDULE AND :REPORTS ON FORM 8-K. (a) Financial Statements. Schedule and Exhibits. I. Financial Statements—filed as an exhibit hereto and incorporated herein by reference. (i) Consolidated Statements of Income for the three years tended December 31. 1995: (ii) Consolidated Balance Sheets—December 31. 1994 and 1995; (iii) Consolidated Statements of Stockholders' Equity for the three years ended December 31. 1995: (iv) Consolidated Statements of Cash Flows for the three years ended December 31. 1995: (v) Notes to Consolidated Financial Statements: and (vi) Report of Independent Public Accountants. U. Schedule (i) Schedule II—Valuation and Qualifying Accounts (u) Report of Independent Public Accountants on Schedule: • All other schedules have been omitted because the required information is not significant or is included in the financial statements or the notes thereto, or is not applicable. M. Exhibits. The exhibits to this report are listed in the Exhibit Index elsewhere herein. Included in the exhibits listed therein are the following exhibits which constitute management contracts or compensatory plans or arrangements": fi) 1981 Stock Option Plan for Non-Employee Directors of registrant (Exhibit 19 to registrant's report on Form 10-Q for the quarter ended June 30. 1982.) iii) W%1X Technologies. Inc. 1982 Stock Option Plan. as amended to %larch 11. 1988 (Exhibit 10.3 to registrant's 1988 annual report on Form 10-K) (iii) Deferred Director's Fee Plan. as amended (Exhibit 10.3 to registrant's 1990 annual report on Form 10-K) (iv) Director's Phantom Stock Plan (Exhibit 10.9 to registrant's 1984 annual report on Form 10-K) (V) Employment Agreement. dated as of September 1. 1986. by and between the registrant and Phillip B. Rooney (Exhibit 19.4 to registrant's report on Form 19-Q for the quarter ended Septerr,ber 30. 1986) ivi) R'%IX Technologies. Inc. Corporate Incentive Bonus P!.an (Exhiba B to registrant's Proxy Statement for its 1995 Annual Meeting of Stockhoiders( (Vii( VL'MS Technologies. Inc. Supplemental Execuu%e Retirement Plan. as amended and restated as of January 25 1995 (filed with this report( 31 re port on Fol—., ill-K ,-.•.•.�r. .r J .J l:._.., x) Supplemental Retirement Benefit Agreement, dated as of January I. 19,89, by and between the registrant and Peter H. Huizenga (Exhibit 10.16 to Post-Effective Amendment No. ' to registrant's registration statement on Form S-1, Registration No. 33-13839) x) Chemical Waste Management. Inc. 1986 Stock Option Plan, as amended (Exhibit I Chemical Waste Management, Inc.'s 1989 annual report on Form 10-K) (x[) WbiX Technologies. Inc. Non-Qualified Profit Sharing and Savings Plus Plan (filed with this report) (xii) Chemical Waste Management. Inc. Deferred D'irector's Fee Plan (Exhibit 10.5 to Chemical Waste Management, Inc.'s registration statement on Form S-1. Registration No. 33-8509) (xiii) WMX Technologies, Inc. Director's Charitable Endowment Plan (Exhibit 10.20 to registrant's 1989 annual report on Form 10-K) (xiv) Supplemental Retirement Benefit Agreement dated as of January 1. 1991 by and between registrant and Donald F. FINnn (Exhibit 10.17 to registrant's 1990 annual report on Form 10-K) (xv) Restricted Unit Plan for Non-Employee Directors of Nk"heelabrator Technologies Inc. as amended through June 10, 1991 (Exhibit 19.03 to the report on Form 10-Q of Wheelabrator Technologies Inc. for the quarter ended June 30, 1991) (xvi) 1988 Stock Plan for Executive Employees of Wheeiabrator Technologies Inc. and its subsidiaries )the "W 11988 Stock Plan") (Exhibit :8.1 to Amendment No. 1 to the 315reg23) statement of Wheelabrator Technologies Inc. on Form S-8, Registration No. 33- 31523) (xvii) Amendments dated as of September 7, 1990 to the WTI 1988 Stock Plan (Exhibit 19.02 to the 1990 annual report on Form 10-K of Wheelabrator Technologies Inc.) (xviii) Amendment dated as of November 1, 1990 to the WTi 1988 Stock Plan. iExhibi[ 19.04 to the 1990 annual report on Form 10-K of Wheelabrator Technologies Inc.) (xix) 1986 Stock Plan for Executive Emplovees of Wheelabrator Technologies Inc. and its subsidiaries (the "WTI 1986 Stock Plan ') (Exhibit -'S.2 to Amendment No. I to the registration statement of Wheelabrator Technologies Inc. on Form S-8. Registration No. 33- 31523) (xx) Amendment dated as of November 1, 1990 to the WTI 1986 Stock Plan (Exhibit 19.03 to the 1990 annual report on Form 10-K of Wheelabrator Technologies Inc.) (xxi) Employment Agreement dated as of April 1. 1995 between the registrant and D. P. Payne (filed with this repent (xxlil Wh1X Technologies. Inc. 1992 Stock Option Plan (Exhibit 10.31 to registrant's registration statement on Form S-1. Registration No. 33-4-:849) (xxiii) WhIX Technoioeies. Inc 1992 Stock Option Plan for Non-Employee Directors (Exhibit 10.32 to regisitant s registration statement on Form S-1. Registration No. 33-33839) (xxiv) Wheelabrator Technoiogies Inc. 1993 Stock Option Plan !Exhibit 10.35 to the 1991 annual report on Form IO-K of Wheelabrator Technologies Ines fxxc) Deferred Director's Fee Plan of Wheelabrator Technoioz:es Inc. adopted June to. 1991 )Exhibit 19.0: to [-e quarterly report on Form 10-Q of Rl-eeiabrator Technologies Inc. for the quarter ended J:7,2 _0. 1991 ) (.xxyir Waste %Ianagemem International plc Share Option Plan Exhibit 10.1 to the registration statement on Form Of Waste Management Intemationai cc. Registration No. 33-365111 S (xxcii Amendment dated as of December 6. 1991 to the 11,77: 1986 Stock Plan (Exhibit 19,01 to the 1991 annual report cn Form 10-K of Wheeiabrator Technologies Inc.) (xxviii i .amendment dated as of December 6. 1991 to the %V71 1988 Stock Plan iExhibit 19.0: to the • 1991 annual report cn Form 10-K of Wheeiabrator Technologies Inc.) (xxix) .amendment dated as of December 6. 1991 to the Restricted [:nit Plan for Non-Employee Directors of Wheelabrator Technologies Inc. (Exhibit 19.05 to the 1991 annual reoort on Form 10-K of Wheelabrator Technologies Inc.( (xxx( WMX Technologies. Inc. Long Term Incentive Plan tas amended and restated as of January 27, 1994) (Exhibit A to registrant's Proxy Statement for its 1995 Annual Meeting of Stockholders) - *in the case of reference to documents filed under the Securities Exchange .act of 1934, the registrant's file number under that Act is 1-7327, Chemical Waste Management's file number under that Act was 1-9253 and Wheelabrator Technologies Inc.'s file number under that Act is 0-14236. (b) Reports on Form 8-K. During the fourth quarter of 1995, the Company filed reports on Form 8-K as follows: (i) a report dated October 17. 1995 reporting under Item 5 the issuance of a news release contenting the Company's 1995 third quarter results of operations and a possible 1995 fourth quarter charge ny Waste Management International; and (ii) a report dated December 1122, 1995 reporting under Item 5 the issuance of news releases cenceming (A) the authorization by the Company's Board of Directors of a Company common stock repurchase program. tB) an increase by WTI in its program for the repurchase of WTI common stock, (C)'a fourth quarter 1995 exceptional charge by Waste Management International. (D) the decision by Rust to sell or otherwise discontinue its orocess engineering. constriction. specialty contracting and similar lines of • business and the possibility of a related 1995 fourth quarter charge. (E) announcement of below- expectations 1995 fourth quarter earnings by Waste Management. International, and (F) expected 1996 earnings growth by Waste Management International. :6 ii t 11,Au1.U(;IcS. iA�, AND �LBsIDIARIES FINANCIAL STATEMENT SCHEDULE ($000's omitted) SCHEDLZE II-11ALUATIO . ND QUAL]EnTiG ACCOUNTS Balance Charged kccounts ERectof Begmning to Written Foreign Balance of Year Income Cam End of 1993—Reserve for doubtful accounts 13 (C) 09 Other(A) Translation Year 556.4',5 533.173 S(33,514) S 7,120 S(1,970) 561.284 1994—Reserve for doubtful accounts )B) (C1 . . 561.284 S34.072 S(40.866) 510.230 S 1,760 $66,530 1995—Reserve for doubtful accounts (B) . . • . . 566.530 539,930 S(42.038) S 1.314 S 1.104 $66,840 (A) Reserves of companies accounted for as purchases. (B) Includes reserves for doubtful lone-term notes receivable. (C) Restated to exclude discontinued operations. s REPORT OF LNDEPEN-DENT PUBLIC ACCOUNTANTS O\ SCHEDULE To 1V NIX Technologies. Inc.: • We have audited in accordance arch generally accepted auditing standards. the consolidated financial statements included in the VV%1 X Technoiogies. Inc. Annual Report to Stockholde s for 1995 filed as an exhibit to and incorporated by reference in this Form 10-K, and have issued our report thereon dated February 5. 1996. Our audit was made for the purpose of forming an opinion on those statements taken as a whole. The schedule included on page 37 of this Form 10-K is the responsibility of the Company's management and is presented for purposes of complying with the Securities and Exchange Commission's Hiles and is not a pan of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion. fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole. /S/ ARTHUR .-lNDERSEN LLP ARTHUR ANDERSEN LLP Chicago, Illinois, February 5, 1996 • .S SIGNATURES Pursuant to the requirements of Section 13 or 13(d) of the Securities Exchange '.-1ct of 1934, the authorized in Oak registrant has duly Brook, Illinois on tcaused this report to he signed on its behalf by the undersigned, thereunto duh• he :9th day of March 1996. WMX TECHNOLOGIES, INC. By /s/ DEAN L. BONTROCE Dean L. Buntrock. Chairman o(the Board and Chief Pursuant to the requirements of the Securities Exchange Act of 934, this creport hasbeensigned below by the following persons on behalf of the registrant and in the capacities and on the date indicated. Signature Title Date /s/ DEAN L. BuNTROCK Director. Chairman of the Board 1 Dean L. Buntrock and Chief Executive Officer /s/ JERRY E. DEMPSEY Director i Jerry E. Dempsey /s/ PHMUP B. RooNEY Director Phillip B. Rooney /s/ DONALD F. FLYNN Director Donald F. Flvnn /S/ PETER H. HUIZENGA Director Peter H. Huizenga /s/ PEER P-DERSE`' Director Peer Pedersen /S/ JA.titES R. PETERSON Director James R. Peterson /S/ ALEXANDER B. TROWBRIDGE Director i March _9. 1996 Alexander B. Trowbridee !s/ HOWARD H. BAKER, JR. Director Howard H. Baker. Jr, /S/ H. JESSE ARNELLE Director H. Jesse .Amelte S/ PASTOR.- JAN JOAN CAFFERTY Director Pastora San Juan Caffein• /S/ JANIES B. EDwARDS Director James B. Edwards /s/ THOMAS C. HAc l"ice Presidenl. Con'oller and Thomas C. Hau Princ:cai .Accoun;:ne Of.^..er /s/ JAMES E. EoENIG Senior % ice Presid.r.7. Chien James E. Koenig Financia! Ofhc.;. `;eascrer and Princ;cai Financ:_1 office,- '9 ffice:9 WMX Technologies, Inc. 1995 Annual Report A ' Serving the Global Environmental Marketplace Financial Highlights Thousands of dollars,except per share amounts 1994 1995 %Change Results of Continuing Operations Revenue $ 9,554,705 $10,247,617 7.3% Operating income before special charges t" 1,752,609 1,910,429 9.0% Operating income 1,743,425 1,575,236 (9.6%) Net income before special charges(1' 780,165 862,784 10.6% Net income 776,491 654,590 (15.7%) Financial Position Total assets $17,423,173 $18,695,308 7.3% Long-term and short-term debt 6,935,097 7,514,775 8.4% Equity G) 6,329,474 6,589;664 4.1% Per Common Share Net income from continuing operations before special charges°' $ 1.61 $ 1.78 10.6% Net income from continuing operations 1.60 1.35 (15.6%) Dividends .60 ,60 — Stockholders'equity 9.38 10.15 8.2% °1 See Management's Discussion and Analysis for discussion of special charges in 1994 and 1995. Includes stockholders'equity,minority interest and put options. Table of Contents Letter to Our Stockholders 2 Consolidated Selected Financial Data 14 Management's Discussion and Analysis 16 Report of Independent Public Accountants 24 Consolidated Financial Statements 25 Notes to Consolidated Financial Statements 30 Environmental Policy 46 Directors and Officers 47 Corporate Information 48 r To Our Stockholders This year we celebrate a quarter-century of growth and achievement as a public company, a celebration marked by our 73,000 talented people serving a worldwide customer base. It's a milestone that pays tribute to the effort our people have invested in serving our customers and making us the world's environmental services leader. Anniversaries allow us to glance back with appreciation, but we also realize we must be sharply focused on the future. The 21st Century will bring with it enormous opportunities. Technology is transforming the way we work and deliver services. A global marketplace is expanding the expectations of our customers. Meanwhile, maturing regulatory environments throughout world markets are demanding newer technologies and more professional services. Building on our skills has been a daily requirement for 25 years, ever since we noted in our first letter to stockholders in 1971 that the solid waste industry was entering a new age of professionalism. Today we're continually improving and responding to rapid change in our industry. We're creating a company that is better able to convert fast-breaking change into opportunity,serve our customers,and deliver long-term value to our stockholders. Strategy Since 1971,the way we have sought to deliver stockholder value has changed. For 20 years we pursued a high-growth strategy based on acquisition. By the early 1990s, our increased size and diversity prompted a strategic response to the changes affecting our industry. We are just as committed to increasing stockholder value today as we were at our founding. Our strategy recognizes the tremendous assets we have put in place across North America and overseas. Today our strategy emphasizes: • Internal growth rather than acquisitions. • Improving returns on invested capital rather than revenue growth. • Generating increased owners'cash flow. • Consolidating our mission,strategies and culture into a single global vision. • And applying technologies that enhance services to our 20 million customers. 2 In 1995, we began to build a framework for this new strategy, implementing the best recommendations of a sweeping review of our operations. Among our actions: • We planned a more balanced approach to growth-one less dependent on acquisitions and more responsive to customer demand. While we expect to continue to grow our revenue base,we also must achieve a better return on our assets. • We launched our plan to create tour global lines of business - in waste services, clean energy, clean water and environmental engineering and consulting services. This realignment aims our greatest strengths directly at what we see as the most pressing needs of a global marketplace. • We simplified our structure -by buying back the publicly owned shares of Chemical Waste Management, Inc. and Rust International Inc. To keep us more focused on the envi- ronmental services business, we also announced our intention to sell or discontinue Rust's process engineering, construction, specialty contracting and similar lines of business. • We focused our management team-to better identify and exploit the synergies among our lines of business and their globally integrated customer bases. Financial Performance In keeping with our strategy, we set an aggressive agenda and meta number of our financial goals for 1995. Our North American solid waste operations had a particularly strong year, and the Company achieved double-digit earnings growth before the impact of special charges. Consolidated net income in 1995 was $604 million, or$1.24 per share, versus $784 million, or $1.62 per share, a year earlier. Excluding special charges,net income per share from continuing operations was $1.78 versus $1.61 a year earlier. Revenue from continuing operations increased to$10.25 billion compared with$9.55 billion in 1994. (See Management's Discussion and Analysis beginning on page 16 for a broader discussion of financial results.) • 3 We also met our objective of generating more than$500 million in owners' cash flow in 1995, and we expect to generate at least $600 million this year. This cash can be used to reduce debt, buy back shares and invest in our core businesses. In December, our Board authorized the repurchase of up to 25 million shares of WMX common stock over the next 24-month period. At the end of 1995, we had approximately 487 million shares outstanding. In addition, the Board of our Wheelabrator Technologies Inc. subsidiary authorized the repurchase of up to 20 million shares of its common stock over two years.Wheelabrator had approximately 179 million shares outstanding at the end of 1995. Waste Services Our waste services line of business accounts for the greatest share of our revenue and operating profit. It includes the operations of Waste Management, Inc. and Chemical Waste Management, Inc. in North America and Waste Management International plc overseas.Today we are working to fully leverage these assets. We're focused on continuous improvement, _ pricing our services competitively, increasing volumes and acquiring companies that add value and enable us to optimize our facilities network. We will enter new markets when we have an opportunity to obtain a strong position that affords us solid prospects for growth. Domestically, 1995 was a good year. Waste Management revenue grew more than 10 percent to more than $5.6 billion in 1995, with operating profit increasing to more than $1.2 billion. Waste Management represents approximately 55 percent of WMX's consolidated 1995 revenue from continuing operations and 66 percent of our consolidated operating profit excluding special charges. Waste Management completed 108 acquisitions in 1995. We recently announced our major entry into New York City with the purchase of the assets of that market's largest recycling and waste processing company, ReSource NE, Inc. We view the purchase of ReSource, with associated revenue of $135 million and 6,000 commercial customers in Brooklyn, Queens and Manhattan, as a first step in expanding in this market. The New York metropolitan area generates approximately 9 percent of all the recycling and solid waste industry revenue in the United States. 4 The year's positive results benefitted from strong growth in the value and volume of recyclable commodities,particularly fiber. Our recycling business novo generates approximately $675 million in revenue. Recycling is an integral part of the services we offer customers. While we cannot control short-term swings in the prices of the commodities we recover and set], we are focused on what we can control—our costs of collection and processing. We also are improving our management of commodity sales to obtain the best prices available. In a move to extend our North American recycling network, Waste Management acquired two recycling firms during 1995: Resource Recycling Technologies, Inc., which owns and operates material recovery facilities in the Northeast and Florida and designs and manages construction of solid waste recycling facilities and systems, and New England CR Inc., which operates 15 material recovery facilities. Waste Management also helped the City of Chicago launch the nation's largest "blue bag" recycling program. More than one million tons of material will be processed annually by Waste Management at four model sorting centers the company designed, built and now operates under a seven-year contract with the city. We now operate more than 170 material recovery facilities throughout the U.S. Our collection and disposal operations continued to perform well, and we are enjoying impressive results as we introduce new technologies to better serve our customers, including automated routing systems and our new Customer Service Centers. Our Customer Service Centers are making us more responsive and easier to deal with and they have helped boost both our customer satisfaction and retention rates. In several markets, including Oakland, California, we are using an innovative ONE PASSTM collection system, enabling us to collect recyclables, garbage and yard waste in one vehicle, reducing our cost of operations. • 5 Our people are more involved in our business than ever before.One example:The introduction of a "lead team' sales program among our employees. Designed to generate sales leads from drivers and other front-line people, this new program produced more than 95,000 suggestions and accounted for some $36 million in new revenue. One employee lead alone yielded a $1-million account. Business Improvement 2000, our process improvement initiative, continues to put our people's best ideas to work to lower costs and improve efficiencies both domestically and internationally. Our goal by the year 2000 is to achieve$200 to$300 million in annual savings. During 1995, the land disposal operations of our Chemical Waste Management unit were integrated into the Waste Management organization. Our land disposal network now includes 133 solid waste and seven hazardous waste facilities. The hazardous waste marketplace continued to be characterized by industry overcapacity, relatively low levels of customer demand and an uncertain regulatory climate. One bright spot came when the South Carolina legislature voted to allow our Chem-Nuclear Systems, Inc. disposal facility for low-level radioactive waste in Barnwell, South Carolina to receive waste from all states except North Carolina. The legislation also allows the facility to operate until its permitted disposal capacity is reached. In May,we strengthened our ability to provide our hazardous waste customers with technical support services such as lab pack management by acquiring 60 percent of Advanced Environmental Technology Corporation. The new entity, called Advanced Environmental Technical Services(AETS), allows us to offer services from more than 40 locations and make better use of our hazardous waste treatment,processing and disposal network. Internationally, we are making good progress in refocusing our business on the core waste services operations and in consolidating our overhead structure. Our goal is to reduce costs and improve operating results, cash flow and return on assets. We continued to see weakness in France and Italy as well as in the European hazardous waste markets, while operations in the United Kingdom, The Netherlands, Germany, Hong Kong, Spain and New Zealand met expectations. 6 The sharp price decline in recyclables during the second half of the year affected all of our international markets, particularly Germany, and strikes in France disrupted operations in that country late in the year. The Asia-Pacific region continues to present us with opportunities for growth. In Hong Kong, we opened our SENT Landfill and in Thailand we are ready to construct that country's first industrial waste treatment facility. In January 1996, the Hong Kong government awarded us a contract to design, build and operate for 15 years a 2,500-tons-per-day waste transfer station. This year, we plan to improve our core waste services by building on the experience and know-how of our domestic operations. Clean Water The worldwide municipal and industrial markets for water services and technologies are projected to require billions of dollars of capital investment over the next 10 years. To expand • this business,we are focused on privatization of government-owned facilities and outsourcing by industrial customers of their water and wastewater needs. We support this service strategy with a comprehensive water technology base. We already are a leader in this marketplace. In November, we formed Wheelabrator Water Technologies, Inc., a new business unit within Wheelabrator Technologies Inc. designed to serve as the core of our clean water business. This new company employs more than 3,000 people in the U.S. and 26 overseas offices. Its 1995 water revenue surpassed$600 million. Wheelabrator Water constitutes one of the largest and most comprehensive water companies in North America. As well as being a leader in the privatization of municipal water treatment and wastewater treatment plants, biosolids management and the outsourcing of industrial water systems, we are concentrating on providing integrated water systems and services for multinational industrial clients in the chemical, petrochemical, electronics, pulp and paper and power industries, among others. We can provide virtually any industry or municipality with a complete range of services, expertise, equipment and technology solutions for water of any purity level, as well as wastewater and biosolids treatment and recycling. • We experienced significant successes in the past year. Among them was the completion of the first wastewater treatment plant public/private partnership in the United States, in Franklin, Ohio. Soon afterwards, we were selected to negotiate a public/private privatization for the 90-million-gallons-per-day wastewater treatment facility in Wilmington, Delaware. We also have been selected by the City of San Diego to join in a partnership agreement to develop and operate a 30-dry-ton-per-day biosolids pelletizing facility. In March, we opened an Asia-Pacific regional office in Singapore, which will be the regional center for the 10 offices we have in eight countries in that fast-growing region. We believe this will help us react effectively to the many opportunities throughout the Pacific Rim for our water and wastewater technologies. Clean Energy Our clean energy line of business includes the trash-to-energy and independent power operations of Wheelabrator Technologies and Waste Management International. We are optimizing the facilities we have in place and believe we can grow our business by providing our expertise to industrial clients interested in outsourcing their energy needs. We'll also look to develop and acquire select projects in the waste fuels and cogeneration areas. The most significant step to strengthen the global clean energy line of business was the formation of a joint venture between Wheelabrator Technologies and Waste Management International. Under this agreement, Waste Management International will develop facilities in Italy and Germany, where it has existing energy operations. Wheelabrator will have responsibility for early-stage marketing and general development of projects in other international markets. When a project is deemed viable, Waste Management International will have the right to acquire up to 49 percent of the equity in that project. Domestically, our 16 trash-to-energy and seven cogeneration plants continue to provide us with solid, steady cash flow. In this mature domestic trash-to-energy marketplace, we continue to optimize plant performance and develop new technologies. A number of our U.S. facilities reached 10-year anniversaries in 1995, and we completed our newest facility, in Lisbon, Connecticut. s Environmental Engineering and Consulting This, our fourth line of business, provides engineering and scientific services to governmental and industrial clients worldwide, acts as a catalyst for the marketing of our other global environmental services and serves as the source for leading-edge technology among the WMX companies. In performing these roles, this business, called Rust Consulting, has achieved significant success. Rust ranks among the world's top 10 environmental and design consultants. Its work includes commercial and engineering services for the development of the Barker power station and desalinization project in Oman; ongoing oversight of two Total Environmental Restoration Contracts for the U.S. Department of Defense; and development of an environmental master plan for Shanghai, China under contract to the World Bank. Rust has provided critical assistance to WMX companies, particularly in the solid waste area, • where its joint projects ranged from the SENT landfill in Hong Kong and the Boston Central Artery project to composting facilities for private and public customers in Switzerland, Germany and Turkey. Rust Consulting employs approximately 4,400 people in 120 offices in over 35 countries, and uses strong local management to develop close relationships with customers and provide services around the globe. Management Changes A final element of our strategy is to align our management team to deliver on our commitment to develop a truly global organization. With this in mind, we reorganized our Management Committee. It includes the heads of our business groups and our senior corporate executive team.They meet regularly to unify our plans, monitor the implementation of recommendations from our strategic review and pursue initiatives to take advantage of the synergies among our operating units.We also are working to enhance six key areas—strategic planning, capital allocation, technology, leadership development, communications and management systems. • 9 We also named a team to head our global lines of business. Phil Rooney, Chairman of Waste Management, heads our waste services line of business.The Clean Energy group is led by John Kehoe, President and Chief Operating Officer of Wheelabrator Technologies.John Goody, a Vice President of Wheelabrator and the Chief Executive Officer of Wheelabrator Water Technologies, is directing our Clean Water business. Tom Leonhardt was named President of Rust Consulting and will lead our environmental engineering and consulting activities. Along with these appointments, Joe Holsten was elected Chief Executive of Waste Management International and Ed Falkman was named Chairman of its Board. Together they have led the restructuring of our international operations. Herbert A. Getz was elected a Senior Vice President of the Company in May. He also serves as General Counsel and Secretary. William Halligan was elected Executive Vice President of Waste Management in January 1996. Bill will assist Phil Rooney in leading the North American waste services line of business. In February 1996, he was also named Chairman of our Waste Management of New York business unit and will be responsible for managing our New York City area business expansion. Dr. James B. Edwards, President of the Medical University of South Carolina and former U.S. Secretary of Energy,was elected to our Board of Directors in May 1995. 'A Quarter Century of Service,A Lifetime Commitment to the Environment' Denise Daniels, a Waste Management of St. Louis Marketing Specialist, coined this theme in honor of our 25th anniversary. It embodies the spirit of our Company and people, and pays tribute to our values. Most important, it also holds us accountable to an unshakable contract for the future, a contract of respect for our customers, our people, our stockholders and our environment. 10 Together we are delivering superior environmental services through a global organization, one seamlessly molded by our skilled people, four lines of business, and 25 years of solid experience. We believe there is no other environmental company whose reach around the world is as vast—or whose range of advanced technologies and services is as proven. These capabilities will help us improve the returns on the assets we have assembled over 25 years. At the same time, we are absolutely committed to nurturing a Company culture in which every person associated with us—employee, stockholder or customer—is proud to be a part of WMX. We are enthusiastically approaching the next 25 years and all its uncertainties with resolve, knowledge and experience. We are excited to play a critical role in shaping tomorrow's world and, heeding the spirit of Denise Daniels' words, we plan to harvest our quarter-century of progress into a lifetime of environmental protection and preservation. Dean L. Buntrock Chairman of the Board Phillip B. Rooney President • v WMX Technologies' Global Environmental Resources s i i loss Revenue area retxesents contribution M WMX revenue Resources Waste Services The Company operates Our waste services business is the largest such from 790 collection enterprise in the world—and the leading recycler / facilities with a fleet and solid waste services provider in the United States. of 28,500 vehicles, 1 The Company operates the leading network of recy- 227 transfer stations, cling,collection,processing,transfer and disposal 208 material recycling i facilities.The Company's services are provided to 81 percent facilities and 195 land 18.8 million households, 1.4 million commercial and disposal sites. industrial customers and more than three thousand six hundred local governmental units worldwide. i clean Energy 16 trash-to-energy Trash-to-energy and Our clean energy capabilities,facilities and projects facilities,seven independent power r make us one of North America's leading builders, cogeneration and projects in Germany, owners and operators of trash-to-energy and inde- independent Italy,Sweden,Taiwan pendent power plants.In addition,we operate a power plants in and the People's ) trash-to-energy plant in Germany and are pursuing North America. Republic of China. energy projects in Europe and in the Pacific Rim. 9 percent The Company also manages coal-handling facilities, and provides patented treatment technology for process residues and combustion ash. i clean Water Operator of 550 water, The Company is one of the leading contract opera- wastewater and tors and private owners of municipal and industrial biosolids projects; i water and wastewater treatment facilities in North 4 biosolids pelletizers; America.The Company provides integrated water and installed base of services for government and multinational chemi- more than 12,000 Indus- call,petrochemicals,electronics,pulp and paper, 6 percent trial water treatment if and power industries and has an installed base of systems worldwide. i thousands of municipal and industrial water treat- i ment systems worldwide. Environmental Engineering and consulting Engineers,scientists r The Company is a leading global provider of and technical person- technology-focused environmental engineering and nel operating from 120 consulting services for public and private-sector clients. consulting offices in 35 countries around the globe. 4 percent III �i it 12 I'' I Iz { a i I i 91�as; Wei KWO 'Rte company is capaMltty,introduced isaggMes 1 t ,: StG7tegy customer service >qp yf that balances internal facilities,improved shariifg df bei pvactices R664'40nonY,4*, wow&and selected customer satisfaction aeras tbegtobe to >' ' s Sp�drs, acWtsitions to increase and launched'&minem leve Wike expertise ' t edam, Market share and f dly improvement 20(10,"a of it'a:pewchnola- :'•' HOatg'kdttB, use ft operatitil;Meet- pmgrant designed to giesiand assets. WOOL The Company enhance its systems to 4 T Od has lmpmved its sales- deliver service. WW,7aind; tlrff 9aieasi G q, vbdti vi&l 4WOThe company is poli- tion of power plants plans skid consls<ettt And toned to capitalize on that use waste fit&to valine tor its operating die1 ds puolect rnanagemem generate a eatr energy; nasfadaertergy ark tit ldba and opeaating;expertise the Company is purseiridopendent power Codevelop international ;ng new opportunities piarLs, new erYetgy pmJnets.With a to serve global comma- t �` unique oxmecompe nides,mull-national na*es,�tecyd og t i t teerce in doe design, cotrtpani governsystemslaw ptovidibll� developmenti firrancing, tints and ni disposal betvtces for ' e ownership and industrial customers.itWastes.sPY ,' Waal wtde! 000 The Company is a The Company plans of kiduat�w water t ; lesttifegwatldwide' to enhance its position and"*-water Ptsetbt. provider of water, through long-term rte ; Pro\lilt Wastewater and operating contracts oomprohmitive systems r biosoifdssetvices and pubW private wmew�ndrecycle S� supported by a strong partnerships with process Water'• base of advanced municipalities.in add- i takC water toollin aogies and fiat,the Company MdT9irrI process knowledgewill seek outsourcing i fa Ila fn ibe Wortdwides 4,400 The Company`provides continue to serve as the in p>aCClieMa; Un Prid its environmental egi- emrtp 9roltedmol- it be Jt atope neerkrg,coming and ogy and consulting catalyst to WW as Akrka sclentiflc services to provider for the WM3C diie WAISIOM a r�ka daft includes affiliated companies. seivioas goveminemaf and. Additionally,as it serves on a lllob l basis. irk WUW dkuus.it will governmental and WMX Technologies,Inc.and Subsidiaries Consolidated Selected Financial Data For the ten years ended December 31 (000's omitted except per share amounts) - Revenue Costs and expenses Special charges Gains from stock transactions of subsidiaries and exchange of Exchangeable LYONS Other expense Income from continuing operations before income taxes Provision for income taxes Income from continuing operations Income(loss)from discontinued operations Income before extraordinary item and cumulative effect of accounting changes Extraordinary item,net of income taxes Cumulative effect of accounting changes Net income Average common and common equivalent shares outstanding Earnings(loss)per common and common equivalent share: Continuing operations Discontinued operations Extraordinary item Cumulative effect of accounting changes Net income Dividends per share December 31, Property and equipment,net Total assets Long-term debt Stockholders'equity '.Votes: (1)The results for 1986 include a non-taxable gain of$234,031,000 resulting (4)The results for 1990 include an extraordinary charge of$24,547,000 from the initial public offering of 18.9 percent of the common stock of reflecting the Company's percentage interest in the writedown by WTI of Chemical Waste Management,Inc.("CWM')in October 1986,as well as WTT's investment in the stock of The Henley Group,Inc.and Henley special charges of$158,268,000(before tax)for restructuring charges related Properties Inc.to market value. to certain facilities not transferred to CWM prior to its public offering and (5)The results for 1991 include a special charge of$296,000,000(before asset revaluations related to the writedown of non-operating assets. rax and minority interest),primarily to reflect then current estimates of the (2)The results for 1988 include a gain of$18,313,000(before tax)resulting environmental remediation liabilities at waste disposal sites previously used from the Wheelabrator Technologies Inc.("WTI")transaction. or operated by the Company and its subsidiaries or their predecessors. (3)The results for 1989 include a non-taxable gain of$70,826,000 resulting (6)The results for 1992 include a non-taxable gain of$240,000,000 from the public offering of 5,000,000 shares of common stock of CWM (before minority interest)resulting from the initial public offering of Waste and special charges of$112,000,000(before tax),principally relating to a Management International plc,('WM International")as well as special provision for the future impact of the then anticipated Federal Subtitle I) charges of$219,900,000(before tax and minority interest),primarily related to regulations which govern post-closure liabilities related to the Company's writedowns of the Company's medical waste business,CWM incinerators in solid waste landfills.These charges also include provisions for costs relating Chicago,Illinois and Tijuana,Mexico and a former subsidiary's investment in to certain hazardous waste facilities not transferred to CWM prior to its its asbestos abatement business and certain restructuring costs incurred by the initial public offering;the restructuring of the Company's lawn care and subsidiary and CWM related to the formation of Rust International Inc.("Rust'). pest control businesses;and the final writedown of the Company's ocean incineration business. 14 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 $1,997,817 52 729,482 $3,528,393 $4,413,742 S 6,034,406 $ 7,550,914 $ 8,661,027 $ 8,636J16 $ 9,554,705 510,247,617 S1,534,917 $2,102,169 $2,742,214 53,476,018 S 4,866,382 S 6,137,936 $ 7,070,953 $ 7,104,115 $ 7,811,280 $ 8,337,188 158,268 - 112,000 - 296,000 219,900 550,000 335,193 (234,031) (160) (1,659) (89,317) (52,948) (53,516) (263,680) (15,109) - 31,360 26,207 23,366 38,540 47,798 142,595 235,442 208,812 379,960 403,603 $ 507303 $ 691,266 $ 764,472 $ 876,501 $ 1,173,174 $ 1,027,899 $ 1,39K,412 S 788,298 $ 1,363,465 $ 1,171,633 136,373 274,188 300,249 314,366 463,865 421,576 477,237 345,867 586,974 517,043 $ 370,930 $ 327,078 $ 464,223 $ 562,135 $ 709,309 $ 606,323 $ 921,175 5 442,431 $ 776,491 $ 654,590 - - _ - - 10,345 7,890 (50,691) $ 370,930 $ 327,078 $ 464,223 $ 562,135 $ 709,309 $ 606,323 $ 921175 S 452,776 $ 784,381 $ 603,899 - 24,547 - - - - - - 71,139 - _ $ 370,930 $ 327,078 $ 464,223 $ 562,135 $ 684,762 $ 606,323 $ 850,036 $ 452,776 $ 784,381 $ 603,899 421,815 449,146 453,711 459,727 476,580 493,167 493,948 485,374 484,144 455,972 $ .88 $ .73 $ 1.02 $ 1.22 $ 1.49 $ 1.23 $ 1.86 $ .91 S 1.60 $ 1.35 - - - - - .02 .02 Cl 1) (05) - - .- __ (14) - - -_ --- - $ .88 $ .73 S 1.02 $ 1.22 $ 1.44 S 1.23 $ 1.72 $ .93 $._- 1.62 $ 1.24 $ .135 S .18 S .225 $ 29 $ .35 S .42 $ .50 $ .58 $ 60 $ .60 $1 459,380 $1,963,661 $2,694,714 $3,65%118 S 5,717,013 $ 6,699,475 $ 7,759,203 S 8,769,459 $ 9,223,757 $ 9,765,699 $2,811,857 $3,387,588 $4,878,533 $6,405,209 $10,518,243 $12,572,310 $14,114,180 $16,264,476 $17,423,173 $18,695,308 $ 402,574 $ 467,539 $1,270,286 $7,503,817 $ 3,139,623 $ 3,782,973 $ 4,312,511 S 6,145,584 $ 6,044,411 $ 6,420,610 $1580,264 $1,885,253 $2,179,207 $2,738015 $ 3,673,017 $ 4,133,100 $ 4319,645 $ 4,159,452 $ 4,540,981 $ 4,942,339 (7)The results for 1993 include a non-taxable gain of$15,109,000,relating (10)In 1995,the Rust Board of Directors approved a plan to sell or otherwise to the issuance ofshares by Rust,as well as a.special asset revaluation and discontinue Rust's process engineering,construction,specialty contracting and restructuring charge of$550,000,000(before tax and minority,interest) .similar lines of business.Accordingly,these businesses have been segregated recorded by CWM related primarily to a revaluation of its thermal treatment as discontinued operations in the financial statements since 1993.It is not business,and a or of approximately$14,000,000 to adjust deferred practical to restate periods prior to the formation of Rust on January 1,1993, income taxes resulting from the 1993 tax law change_ for the discontinued operations. (8)The results for 1994 include a charge of 59,200,000(before tax and 01)Certain amounts have been restated to confoiin to 1995 classifications. minority interest)recorded by Rust o write off assets and to recognize costs of exiting certain of Rust's service lines and closing offices in a consolidation of its other operations.This charge is included in costs and expenses. (9)The results for 1995 include a special charge of$140,600,000(before tax) recorded by CWM,primarily to write off its investment in facilities and tech- nologies that it abandoned because they do not meet customer service or performance objecoves,and a special charge of$194,600,000(before tax and minority interest)recorded by WM international relating to actions it is taking to sell or otherwise dispose of non-core businesses and investments,as well as core businesses and investments in low potential markets,abandon certain hazardous waste treatment and processing technologies,and streamline its country management organization_ • 15 WMX Techn0(,gw,,Inc.and Subsidiencs Management's Discussion and Analysis Results Of Operations Consolidated Consolidated 1995 revenue from continuing focusing on streamlining business units,enhancing management operations of WMX Technologies,Inc.and its subsidiaries and planning processes, reducing operating costs and improving ("WMX"or the"Company")was$10.25 billion compared with profitability, improving customer satisfaction,and increasing $9.55 billion in 1994 and S8.64 billion in 1993. returns on capital and cash flow.As an outcome of these efforts, Consolidated 1995 net income was 5603.9 million or$1.24 per management was realigned on the basis of four principal global share,compared with$784.4 million or$1.62 per share in 1994 lines of business-waste services, clean energy,clean water, and and$452.8 million or$0.93 per share in 1993.Net income from environmental and infrastructure engineering and consulting ser- continuing operations was 5654.6 million or$1.35 per share in vices. Executives were named to head each of these global lines 1995, $776.5 million or 51.60 per share in 1994,and$442.4 million of business.The shares of CWM and Rust owned by the public or$0.91 per share in 1993 were purchased by the Company.The management and sales Earnings from continuing operations during the three years organizations of Rust Industrial Services were integrated into the were impacted by special charges,gains from stock transactions waste services line of business to provide a seamless offering to of subsidiaries,and an increase in U.S. tax rates.The following industrial customers. Rust exchanged its remediation business table reconciles reported earnings per share from continuing in 1995 for an equity interest in OHM Corporation("OHM'). operations to earnings excluding such items: Wheelabrator Technologies Inc. ("WTI")and WM International formed a joint venture in 1995 to develop trash-to-energy projects 7993 ly<)n 1995 on a worldwide basis outside Germany,Italy and North America. Reported amount $0.91 $1.60 S 1.35 A new management team at WM International completed an Gains on stock transactions extensive review of its operations and management structure of subsidiaries (0.02) to refocus on its core waste services business, and as a result Special charges(see Note 14 aclopted a plan to sell or otherwise dispose of non-core to Consolidated Financial businesses and investments.as well as core businesses and Statements)- investments in low,potential markets,abandon certain hazardous Chemical Waste waste treatment and processing technologies,and streamline its Management,fnc.("CWM") 0.59 0.19 country management organization.During the fourth quarter Waste Management International plc of 1995,the Company announced that Rust would sell or discon- ("WM International") 0.23 tinue its process engineering,construction,specialty contracting Rust International Inc.("Rust") — 0.01 — and similar lines of business and focus on the environmental and Costs related to early infrastructure engineering and consulting business.Operating extinguishment of debt 0.01 results of the businesses to be discontinued have been segregated Adjustment to deferred income taxes from continuing operations in the Consolidated Statements of resulting from 1993 tax law change 0.03 Income and are not included in the analysis which follows. Amount excluding above items $1.51 51.61 $1.78 The analysis of results of continuing operations which follows - - reflects the Company's traditional management structure of f ive The environmental service business has undergone significant principal subsidiaries,each of which has operated in a relatively change over the three-year period Overcapacity in the hazardous discrete portion of the environmental services industry or geo- waste segment,an emphasis on waste minimization and recycling graphic area.WMI has provided integrated solid waste services as opposed to land disposal,increased competition for landfill and CWM has provided hazardous waste collection,transporla- volume,changes in government regulation,and slow growth in tion,treatment and disposal services in North America.WM the trash-to-energy market flax e affected the industry globally. international has provided these services,as well as trash-to- In addition,political uncertainty in Italy and economic conditions energy services,outside North America.WTI has been involved in Prance and Germany have further affected the Company's in trash-to-energy and independent power projects,water and international operations. wastewater treatment,and air quality control, primarily in North The Company has taken a number of steps to realign and America. Rust has served the engineering,construction,environ- restructure its business in response to these changing conditions mental and infrastructure consulting,and on-site industrial and to position itself for growth and improved profitability and related services market in the United States and a number into the 21st century. Hazardous waste operations have been of foreign countries. downsized and management of land disposal facilities has been Beginning in 1996,to conform to its new management structure, integrated into the Waste Management, Inc. ("WMI")North the Company will report operating results along the four major American solid waste management organization.WMI itself was business lines discussed above.Note 13 to the Consolidated reorganized during late 1993 to flatten the organization and bring Financial Statements shows results of continuing operations for decision-making closer to the customer.During 1994,the 1993,1994 and 1995 on a line-of-business basis,as well as on the Company commenced a major strategic review of its operations, basis of the traditional management structure. 16 1994 Operations Compared With 1993 WMI WMI's revenue grew 8.8%to S5.12 billion in 1994 compared outside an eight-state region in the southeastern United States with $4.70 billion in 1993.Revenue growth occurred in all service (`Southeast Compact")after]une 30,1994. Event business lines as shown in the following table- (revenue from relatively larger,typically non-recurring projects) Residential 4.6% was 9.0%of revenue in 1994 compared to 10.6%in 1993.The Commercial 8.1 decline in event business revenue was primarily the result of Rolloff and industrial 11.1 reduced off-site disposal from environmental cleanup projects. Disposal,transfer and other 11.8 During 1993,CWM completed a study of its business and began a strategic reconfiguration of its operations to meet then-current Price increases accounted for revenue growth of approximately market demand. In connection therewith,CWM recorded a charge 1.5%.WMI focused on pricing on a customer-hy-customer basis of$550 million be:ore tax,including$381 million to write down and sought increases when and where appropriate. Pricing in the assets,primarily incinerators,and$169 million for cash expendi- commercial,rolloff and industrial lines generally continued the tures to be made as part of a program to reduce costs and improve positive trend begun in the fourth quarter of 1993. Residential efficiency.This retdructuring was completed in 1994 and substan- work remained extremely competitive and disposal pricing varied tially all cash expenditures were made.As a result,overhead, by region,but generally improved during the year. Higher recy- including depreciation and amortization,was reduced in 1994 clable commodity prices,which can vary significantly from year by approximately$60 million on an annualized basis. to year, helped 1994 results.Volume increases accounted for Operating expenses declined as a percentage of revenue in revenue growth of 7.8°%,despite the negative impact of the loss 1994 to 70.0%compared to 76.59/o in 1993. Benefits from the of volume from the contract to dispose of debris from Hurricane restructuring were partially offset by severe weather in the north- Andrew in 1993 and the loss of a disposal contract for the City of east portion of the United States during the first quarter,which Philadelphia as ofJuly 1, 1994.The increase in disposal,transfer delayed projects and hampered operations,and a shift of revenue and other revenue was aided by special waste volume,which mix toward lower margin services. Selling and administrative increased over 20%,and recycling,which grew 29%(including expenses declined$22.3 million in 1994 on an absolute basis and the impact of higher commodity prices discussed above). Revenue were reduced from 19.3%of revenue to 16.3%, primarily as a decreases due to businesses sold exceeded revenue from acquisi- result of the restructuring. tions by approximately 0.5%in 1994,primarily the result of the WTI WTI revenue increased 16%to$1.32 billion in 1994. sale during the first quarter of that year of W MI's ModulairO Businesses acquired in 1993 and 1994 contributed approximately mobile office business and certain other under-performing busi- 47%of the revenue increase,while incremental operating and nesses,coupled with reduced acquisition activity. construction revenue from new energy and water development Operating margins strengthened throughout the year following projects accounted for the remainder. Revenue from existing the 1993 reorganization discussed previously,and were 20.8/, businesses was Flat in 1994 compared to 1993. of revenue compared with 20.4%in 1993.This improvement Consolidated revenue for the energy business line(which resulted from productivity increases,particularly in the selling includes WTI's air business)grew 583.1 million,or I Ph,in 1994 and administrative areas where expenses remained relatively to$844.7 million. Revenue from trash-to-energy and independent constant in dollars and declined as a percentage of revenue, power facility operations grew$98.2 million from the prior year stronger pricing and increased volume, partially offset by higher level and generated approximately 82%of the 1994 revenue for costs of operating disposal facilities to comply with more stringent this business line compared with 78%in 1993.Air-related busi- environmental regulations. nesses were responsible for the balance of the revenue during CWM CWM revenue continued to decline in 1994,to both periods.Construction revenue on the Lisbon,Connecticut, $649.6 million from$661.9 million in 1993.The following table trash-to-energy facility provided half of the energy business analyzes revenue changes in 1994 compared with 1993' growth.The third quarter 1994 commencement of commercial operations at the Falls Township trash-to-energy facility in Percentage Pennsylvania and the wood waste and scrap tire-fueled Ridge Increase/(Decrease) Generating Station in Florida provided an additional 25%of the Price 2.9% revenue growth. Excellent plant operating performances,coupled Volume (7.2) with a shift in the mix of waste received at the trash-to-energy Purchased businesses 2.4 plants from lower-priced spot tons to generally higherpriced Total (1,9)% contract tonnage accounted for the remainder. Air business -- revenue fell in 1994 primarily because of an expected lull in air Price and volume increases for low-level radioactive waste pollution control retrofit activity by utilities between Phases I services,which increased revenue by 3.1%,were more than and II of the Clean Air Act Amendments of 1990.In addition, offset by a continuation of industry conditions which negatively many industrial customers delayed awards for air quality control impacted the remainder of the hazardous waste industry.The equipment purchases in response to economic uncertainty and strong results in the low-level radioactive waste services line to rule-making delays and limited enforcement activities by the resulted from the acceleration of volume received at CWM's U.S.Environmental Protection Agency. disposal facility in Barnwell, South Carolina, in anticipation of a Energy operating income increased to$247.0 million or state deadline which denied access to that facility to customers 29.2%of revenue in 1994,versus$208.7 million,or 27.4%of revenue,in 1993.The addition of the Falls Township and Ridge 17 facilities,modest improvement in gross margin,and a decline increase was obtained on the municipal contract in Buenos Aires, in selling and administrative expense were responsible for this Argentina.The volume increase in 1994 related primarily to con- improvement,despite Lisbon construction revenue having no struction activity on the solid waste SENT landfill in Hong Kong. associated margin recognition.Integration of acquired air busi- Economic and competitive pressures caused volume declines in nesses and a decrease in energy-related project development Italy,France, and Germany,which were more than offset by expenditures in response to limited market opportunities caused volume increases in other countries. selling and administrative costs to decrease in 1994 in both Revenue increases from acquisitions slowed in 1994 compared absolute terms and as a percentage of revenue. to 1993.With WM International well positioned in many of its Water revenue increased$97.1 million to$4893 million in 1994, markets, it focused primarily on"tuck-in"acquisitions(small a 25%increase from the 1993 level of$392.2 million.Acquisitions acquisitions in markets where it already had a support staff)and contributed approximately$81.5 million or 84%of this revenue became more selective with respect to acquisitions. growth,and expanded WTI's presence in the industrial water and A significant portion of WM International's revenue arises in wastewater treatment markets while increasing the breadth of currencies other than pounds sterling(its reporting currency)or WTI's technology and process offerings.The full year impact of U.S. dollars.As a result,foreign currency movement has had and the New York Organic Fertilizer Company("NYOFCO')biosohds will continue to have an impact on reported revenue,expenses pelletizer facility,which began commercial operations in the third and net income,stated in both pounds sterling and U.S.dollars. quarter of 1993,accounted for an additional$35.5 million of incre- Both the Company and WM International periodically engage mental 1994 revenue.Increased 1994 revenue from sales of water in hedging transactions intended to mitigate currency risk. process systems and equipment to industrial customers was offset See`Derivatives.' by a decline in revenue from water,wastewater,and biosolids Operating expenses increased to 72.7%of revenue in 1994 contract service operations and curtailed equipment procurement compared to 71.5%in 1993 due to higher labor costs and pricing by municipal customers. pressure in Italy,pricing pressure in Germany and France,and Operating income from the water business line increased flow control issues and landfill permitting delays in Italy and 22%to$41.1 million or 8.4%of revenue in 1994 compared with France.Selling and administrative expenses decreased to 13.4% $33.7 million or 8.6%of revenue in 1993 Gross margin declined of revenue in 1994 compared with 14.1%in 1993 as a result of the to 24.5%of revenue in 1994 versus 24.9%in 1993 because of impact of"tuck-in"acquisitions,a higher revenue base to absorb competitive pricing pressures in the equipment product lines the cost of corporate and country management and administrative and faster relative growth of the process systems business,which infrastructure, integration of acquired businesses,and a continued is typically lower margin in nature. Selling and administrative focus on improved productivity and administrative cost reduction. expenses declined slightly in 1994 as a percentage of revenue Rust Rust's 1994 revenue from continuing operations was as a result of consolidation of acquisitions partially offset by $1.14 billion compared with$1.04 billion in 1993,an increase increased own/operate development expenditures. of 10.2%. Revenue growth by line of business is shown in the WMIntemationat WM International is a U.K.corporation following table($000's omitted): which prepares its financial statements in pounds sterling under accounting revailin m the United Kingdom.Such Percentage P g g 1993 1994 maeesc accounting principles differ in certain respects from those gener- allyaccepted in the United States("US GAAP").The discussion Engineering and and analysis of WM International is based on US GAAP financial consulting services $ 298,879 $ 425,058 42.2% statements with pounds sterling translated to U.S.dollars at the Remediation and rate used to translate WM International financial statements for industrial services 704,360 715,236 1.5% inclusion in the Company's consolidated financial statements. Asbestos abatement 31,765 N/A Stated in U.S.dollars,WM International revenue grew by 'total $1,035,004 $1,140,294 10.2% $299.7 million or 21.2%to$1.71 billion in 1994 compared with$1.41 billion in 1993 Components of revenue change In May por Rust transferred its asbestos abatement business are as follows to NSC Corporation("NSC")in exchange fora 41%equity interest in NSC and NSC's ownership interest in two industrial services Percentage Increase businesses.Excluding the effect of the asbestos abatement busi- Price 1.7% ness,revenue increased 13.7%in 1994 compared with 1993. Volume(including start-ups) 8.9 Engineering and consulting services revenue grew by 42.2%in Purchased businesses 9.4 1994.The full year impact of 1993 acquisitions and domestic and Foreign currency translation 1.2 foreign 1994 acquisitions resulted in revenue growth of 35.500/,. Total 2121% The balance came from increases in existing businesses. Remediation and industrial services revenue grew by 1.5°%in Lower inflation and weak economic conditions in many 1994. Growth was the result of the full year impact of 1993 acquisi- European countries constrained WM International's ability to tions.Revenue in existing businesses declined due to severe increase prices in 1994.In Italy,where a substantial portion of weather in the first quarter and delays by scaffolding and industrial its business is municipal contracts,renewals during much of customers of scheduled plant maintenance.In addition,the antici- 1994 were consistently at reduced prices. However,a price pated award of a large Federal remedial contract was delayed. 18 In December 1994,Rust signed an agreement with OHM to expenses were 13.2%of 1994 revenue compared with 12.7%of acquire an approximately 37%interest in OHM in exchange for 1993 revenue The increase in 1994 is attributahle to the lower Rust's remediation services business This transaction was revenue base in existing businesses and to acquisition activity, completed in May 1995. For 1994, the business transferred had which typically initially increases these costs,although it is antici- revenue of$231.1 million and operating income(after operating, pated that such expenses will decline as a percentage of revenue selling and administrative expenses)of$6.0 million. as the acquired companies are integrated into existing operations. Revenue from affiliated companies was$118.3 million in 1994 In 1994,Rust recorded a pretax charge of$9.2 million for the compared with$112.8 million in 1993. write-off of assets and the recognition of one-time costs incurred Excluc.ing the charge discussed in the following paragraph, in the fourth quarter in connection with the discontinuance of its operating expenses were 79.7/%of revenue in 1994 compared marine construction and dredging operations,and the closing of with 78.1`%in 1993, partially the result of severe weather in the offices in a consolidation of its other operations.After tax and first quarter and delayed projects which resulted in less efficient minority interest,the charge reduced the Company's net income personnel utilization.In addition,1994 saw a shift in revenue mix by$0.01 per share. in favor of lower margin businesses. Selling and administrative 1995 Operations Compared With 1994 WMI Revenue for WMI was$5.64 billion in 1995 compared with 60%interest in Advanced Environmental Technology Corporation. $5.12 billion in 1994, an increase of 10.3%. 1995 revenue growth In addition, unusually high revenue in the second quarter of 1994 by line of business is shown in the following table: at CWM's Barnwell, South Carolina, low-level radioactive waste Residential 6.3% disposal facility adversely impacted 1995 comparisons.However, Commercial 7 5 during June 1995,South Carolina approved legislation which Rolloff and industrial 7 5 extended the authorized life of the Barnwell site until its permitted Disposal transfer and other 20.3 disposal capacity is fully utilized:previously,the site had been required to close at December 31, 1995.The legislation also again Revenue growth came from price(2.5 to 30c)and volume permitted acceptance of waste from outside the Southeast (6 to 6.5%)increases,with acquisitions accounting for 1%. Prices Compact.Event business continued to decline in 1995,to 7.7/o of recyclable commodities continued the 1994 upward trend of revenue versus 9.00/o in 1994. during the first six months of 1995,but then began moving Operating expenses increased as a percentage of revenue in downward and by the fourth quarter were below the levels of 1995 to 75.6%compared to 70.0%in 1994.The increase was the same period in the prior year. Beginning 1996,commodity a function of pressure on pricing,a lower revenue base,and a prices have been significantly below levels which were achieved shift in revenue mix toward lower margin technical services, in 1995 and management does not foresee these prices recovering which offset the benefit from personnel reductions. Selling and to 1995 levels during 1996.Volume growth was helped by a rela- administrative expenses declined in both absolute terms and as tively mild winter in 1995,whereas severe weather over a large a percentage of revenue as a result of personnel reductions. part of the country adversely affected the first quarter of 1994. During the first quarter of 1995,CWM recorded a pretax charge Volumes in 1995 were adversely impacted by the loss of the of$140.6 million,primarily to write off its investment in facilities disposal contract for the City of Philadelphia as of July 1,1994. and technologies that it abandoned because they did not meet Revenue from recycling increased 71.9%in 1995 compared with customer service or performance objectives in the current market 1994 as a result of the favorable pricing discussed above,as well environment.The percentages above exclude this charge. as WMFmarketing efforts and acquisition and construction of WTI WTI revenue increased 9.6%to$1.45 billion in 1995.Energy additional material recovery facilities, business line revenue was essential!y flat as higher revenue from Operating expenses were 6750/6 of revenue in 1995 and 68.4%in operating energy p,ants was offset by lower construction revenue 1994.Milder weather in 1995,WMI's pricing effectiveness program, on the Lisbon facility and by a further decline in air business rev- improved safety performance,higher recyclable commodity prices, enue.Approximately 85%of the 542.3 million growth in revenue internalization of recycling processing,and continuing productivity from operating plants was accounted for by the Falls Township enhancements all contributed to the improvement.Selling and and Ridge Generating Station facilities which began operations in administrative expenses were 10.201(,of revenue in 1995 compared 1994.Contractualrice escalation on long-term trash disposal and with 10.8%in 1994.Although such expenses increased in absolute energy sale contracts, partly offset by curtailment of electrical pur- dollars,productivity enhancements have enabled WMI to manage chases by certain utility customers,accounted for the balance of a higher revenue hase with relatively modest selling and adminis the operating plant revenue growth. Spot pricing,on the whole, trative expense increases,the majority of which result from was stable,although there were increases in certain markets offset acquisitions and pay-for-performance compensation plans. by declines in others,particularly Florida and the metropolitan CWM C`WM revenue again declined in 1995 as waste minimiza- New York City arca.Air business revenue declined$30.7 million to tion,recvding,over-capacity and shifting governmental regulation 15%of total energy revenue,reflecting a continuation of the indus- and enforcement continued to adversely affect the hazardous try-wide decrease in activity in the face of regulatory uncertainty. waste industry.Total 1995 revenue was$613.9 million compared Operating income from the energy business line grew$5.4 mil- with $649.6 million in 1994. Pricing and volume growth were lion to$252.4 million in 1995 and also increased as a percentage both negative,only partially offset by the 1995 acquisition of a of revenue to 30.10i6 from 29.20/x.Selling and administrative costs to were flat compared to 1994 both as a percent of revenue and to prices on rebids of municipal contracts in Italy.Acquisition activity absolute dollars,but operating margins improved due to cost con- continued to be below WM International's historical levels and tainment efforts at operating energy facilities and less revenue on focused particularly on"tuck-in"acquisitions which can comple- the Lisbon facility where no margin was recognized Development ment or expand existing operations in a given market.WM activity increased slightly because of activities associated with the International also increased its emphasis on acquisition and con- July 1995 joint venture agreement with WM International. struction of material recovery facilities to take advantage of a Revenue in the water business line increased$129.2 million continued emphasis on recycling as an alternative to land disposal. from$489.3 million in 1994 to$618.5 million in 1995,a 26% Operating expenses(excluding the special charge discussed increase.The full year impact of businesses acquired in 1994 below)increased to 75.6%of revenue in 1995 compared with provided approximately 64%of this increase.In 1995,WTI suc- 72.7%in 1994,a result of higher labor costs in Italy,continuing cessfully completed the privatization of the Miami Conservancy pressures on pricing,particularly in Italy and France,and disruption District wastewater treatment plant in Franklin,Ohio,the first of operations in France during the fourth quarter due to widespread privatization of a municipal wastewater treatment plant under strikes and industrial action against the government.Selling and Executive Order 12803 issued by President George Bush in 1992. administrative costs increased 2.5%in absolute terms but declined Approximately 4%of the 1995 revenue growth came from the as a percentage of revenue to 12.6%in 1995 from 13.4%in 1994 Baltimore I pelletizer facility,which began commercial operations due to the higher revenue base,the benefit of"tuck-in"acquisi- at the start of the year.Existing businesses accounted for the tions,and continued emphasis on productivity improvements. remainder of the revenue growth as WTI increased its biosolids Following a thorough review of its operations and management landspreading activities in California and experienced strong structure by a new management team,WM International worldwide demand for its surface cleaning and screen products. announced a fourth quarter pretax special charge of$194.6 mil- Operating income grew$9.6 million,or 23%,to$50.7 million and lion,related to actions it is taking to sell or otherwise dispose of represented 8.2%of 1995 water revenue.Faster relative growth of non-core businesses and investments, as well as core businesses the process systems business,which typically is lower margin in and investments in low potential markets,abandon certain haz- namre,and costs incurred to consolidate office and manufacturing ardous waste treatment and processing facilities,and streamline locations were the principal reasons for the slight operating mar- its country management organization.Approximately$34.3 mil- gin decline as a percent of revenue compared with 1994.Margins lion of this charge represents cash costs related to severance of in the contract services business improved compared with 1994 personnel and rents under non-cancelable leases.Approximately due to cost reduction efforts,while equipment margins remained 511.2 million of the cash costs were paid prior to December 31, relatively stable and process systems margins declined slightly. 1995.The majority of the balance will be paid in early 1996, _ Selling and administrative costs increased$11.3 million in 1995 although certain rent payments on leased facilities will continue because of the full year impact of 1994 acquisitions,hot declined into the future.WM International expects that upon completion as a percent of revenue to 14.5%,a result of a higher revenue base of these actions,overhead will be reduced by approximately and the integration of acquisitions into existing businesses. $20 million annually,which management plans to invest in new marketing initiatives and operational productivity enhancements. wminte tion! WM International revenue,in U.S.dollars, However,the full benefit of these new programs will not be grew$154.2 million or 9.0%to$1.87 billion in 1995 compared reflected in the short term,and management has cautioned with$1.71 billion in 1994. Components of revenue change are WM International shareholders not to expect more than 5%to as follows: 10%growth in 1996 earnings. Percentage Rust Rust revenue from continuing operations decreased InereaseADecrease) _- _.. $112.9 million or 9.9%to 51.03 billion in 1995 compared with Price 1.80/0 $1.14 billion in 1994. Revenue by business line is shown in the Volume(including start-ups) (3.2) following table($000's omitted): Purchased businesses 4.5 Foreign currency translation 5.9 Percentage -� 1994 1995 Increase/(Decrease) Total 9.0% Engineering and The major cause of the 1995 volume decline was the completion consulting services $ 425,058 $ 454,105 6.80/o of the construction phase of the SENT landfill in Hong Kong, Industrial and which opened during the year.A new pricing mechanism intro- other services 484,178 511,102 5.6 duced by the Hong Kong government in March 1995,which Remediation 231,058 62,223 N/A requires generators to absorb a portion of the disposal cost for Total $1,140,294 $1.027,430 (9.9)/o waste brought to the Hong Kong incinerator,has resulted in vol- ume declines in certain waste streams,but the impact has been In May 1995,Rust exchanged its remediation business for an offset with other volumes.The future impact of these charges,on approximately 37%equity interest in OHM.Excluding the effect the incinerator and on the SENT landfill should they be extended of the remediation business,revenue increased 6.2%in 1995 to that facility,is uncertain.Pricing in Europe was negatively compared with 1994.This increase was the result of additional impacted in 1995 by relatively low inflation,highly competitive volume across existing businesses as the impact of acquisitions conditions in the solid waste market in France,softness in seg- was not significant.Revenue from affiliated companies declined ments of the hazardous waste market,and a continuation of lower to$89.7 million in 1995 from$118.3 million in 1994. 20 Backlog in continuing operations at December 31, 1995, of$349 million over their remaining terms; in addition,a portion was$416 million,down froth 5671 million at December 31, 1994. of any projects performed may be remediation work which Approximately$177 million of the 1994 backlog relating to the would now he performed by OHM. remediation business was transferred to OHM. The backlog Operating expenses were 79.5%of revenue in 1995 compared shown above does not include approximately 5349 million with 79.7°%in 1994. Selling and administrative expenses also at December 31, 1995,for several Department of Defense con- decreased to 13.lsvo of 1995 revenue from 13.2%%of 1994 revenue. tracts, including two Total Environmental Restoration Contracts. These slight improvements were primarily the result of the elimi- There is no assurance that specific.projects identified and per- nation of the relatively low margin remediation husiness. formed under these contracts will generate aggregate revenue Other Items - Interest The following table sets forth the components of Minordtylnterest The minority interest in 1993 reflected the consolidated interest expense, net 6000's omitted): lower earnings of the Company's subsidiaries in that year and 1993 1994 1995 the minority interest(approximately$78.6 million)in the special -- - charge recorded by CWM. Minority interest in 1995 reflects the Interest expense $393,631 5439,687 $506,207 repurchase of the public shares of CWM and Rust,as well as the Interest income (41,198) (34,488) (39,804) minority interest(approximately 541.3 million)in the special Capitalized interest (100,591) (104,512) (81,471) Marge recorded by WM International. Interest expense, net $251842 $300,687 5384.932 Sundry Income,Yet Sundry income relates primarily to earnings Net interest expense has increased during the three-pear recorded on the equity method from the Company's investments period, partially the result of an earlier management decision to in less than 50%owned affiliates. In addition,CWM recognized increase the leverage of the Company. Debt levels increased in a gain in the first quarter of 1993 on the sale of shares of common 1993 to fund stock repurchase programs,acquisitions and capital stock of WTI it had held for investment. expenditures,and approximately$130 million paid to acquire the Income Taxes In August 1993, the U.S.Congress passed and minority interest in it subsidiary of Rust. Debt levels remained Flat the President signed the Omnibus Budget Reconciliation Act of during 1»4 but interest expense increased as a result of higher 1993, which, among other things, increased U.S.Federal income U.S. interest rates and the full year impact of the 1993 borrowings, taxes for the Company and its domestic subsidiaries, retroactive The increase in debt in 1995 is primarily a result of the acquisition in certain cases to January 1, 1993.The provision for 1993 income of the public ownership of CWM and Rust.Capitalized interest taxes includes approximately 514.0 million to adjust deferred also declined substantially in 1995 as a number of significant income taxes as a result of this law.The consolidated income tax capital projects were completed and became operational near rate increased slightly in 1995 as a result of shifts in the sources the end of 1994. See"Financial Condition-Capital Structure." of taxable income and the inability to realize tax benefits on a portion of the special charges. Accounting Principles Effective January 1, 1994,the Company adopted Statement of for fiscal years beginning after December 15,1995.The Company Financial Accounting Standards("FAS")No. 112-Employersdoes not believe the adoption of FAS No. 121 will have a material Accounting for Postenployment Benefits-and FAS No. 115- impact on the financial statements. Accounting for Certain Investments in Debt and Equity Securities. In October 1995,the FASB issued FAS No. 123-Accounting The adoption of FAS No. 112 did not have a material impact on for Stock-Based Compensation-which the Company also must the Company's financial statements as its previous accounting adopt in 1996.FAS No. 123 provides an optional new method of was substantially in compliance with the new standard. Other accounting for employee stock options and expands required than for short-term investments which were previously accounted disclosure about stock options. If the new method of accounting for in accordance with FAS No. 115,the Company does not have is not adopted,the Company will be required to disclose pro significant investments of the type covered by that standard. forma net income and earnings per share as if it were.The The Financial Accounting Standards Board("FASB`)has issued Company is studving FAS No. 123 and is gathering data necessary FAS No. 121 -Accounting for the Impairment of Long-Lived Assets to calculate compensation in accordance with its provisions,but and for Long-Lived Assets to Be Disposed of-which is effective has not decided whether to adopt the new method or quantified its impact on the financial statements. Derivatives _ - - -- From time to time the Company and certain of its subsidiaries non-performance. In addition,maximum credit exposure is repre- use derivatives to manage currency,interest rate,and commodity rented by the fair value of contracts with a positive fair value;at (fuel)risk.Derivatives used are simple agreements which provide December 31, 199 ,such amounts were not material.The impact for payments haled on the notional amount, with no multipliers of derivatives on the Company's financial statements has not been or leverage. All derivatives are related to actual or anticipated significant.See Note 6 to Consolidated Financial Statements for instruments or transactions of the Company.While the Company further discussion of the use and accounting for such instruments. is exposed to credit risk in the event of non-performance by colon- Also see"Financial Condition-Capital Structure"for a discussion terparties to derivatives,in all cases such counterparties are highly of the Company's sale of put options in connection with its autho- rated financial institutions and the Company does not anticipate rized stock repurchase program. 21 Environmental Matters The majority of the businesses in which the Company is engaged and relative degree of responsibility of other PRPs who are jointly are intrinsically connected with the protection of the environment. and severally liable for remediation of the specific site,as well As such,a significant portion of the Company's operating costs as the typical allocation of costs among PRPs.These estimates and capital expenditures could be characterized as costs of envi- sometimes involve a range of possible outcomes.In such cases, ronmental protection.While the Company is faced, in the normal the Company provides for the amount within the range which course of its business,with the need to expend funds for environ- constitutes its best estimate.If no amount within the range mental protection and remediation,it does not expect such appears to be a better estimate than any other amount,then the expenditures to have a material adverse effect on its financial con- Company provides for the minimum amount within the range in dition or results of operations because its business is based upon accordance with PAS No. 5.See Note 7 to Consolidated Financial compliance with environmental laws and regulations and its ser- Statements for additional details regarding the Company's envi- vices are priced accordingly. Such costs may increase in the future ronmental liabilities. as a result of legislation or regulation;however,the Company Estimates of the extent of the Company's degree of responsibility believes that in general it benefits from increased governmental for remediation of a particular site and the method and ultimate regulation,which increases the demand for its services,and that it cost of remediation require a number of assumptions and are has the resources and experience to manage environmental risk. inherently difficult,and the ultimate outcome may differ from cur- As part of its ongoing operations,the Company provides rent estimates.However,the Company believes that its extensive for estimated closure and post-closure monitoring costs over experience in the environmental services business,as well as its the operating life of disposal sites as at is consumed. Such involvement with a large number of sites,provides a reasonable costs include a final cap and cover on the site,methane gas and basis for estimating its aggregate liability.As additional information leachate management,and groundwater monitoring. becomes available,estimates are adjusted as necessary.While the The Company has also established procedures to evaluate Company does not anticipate that any such adjustment would be potential remedial liabilities at closed sites which it owns or oper- material to its financial statements,it is reasonably possible that ated or to which it transported waste,including 106 sites listed technological,regulatory or enforcement developments,the results on the Superfund National Priority List("NPL")as of December 31, of environmental studies,or other factors could alter this expecta- 1995. In the majority of situations,the Company's connection tion and necessitate the recording of additional liabilities which with NPL sites relates to allegations that its subsidiaries(or their could be material.The impact of such future events cannot be predecessors)transported waste to the facilities in question,often estimated at the current time. prior to the acquisition of such subsidiaries by the Company. The Company spent$348 million,$58.8 million and$50.1 mil- The Company routinely reviews and evaluates sites requiring lion on remedial activities at closed sites in 1993, 1994 and 1995, remediation,including NPL sites,giving consideration to the respectively,and anticipates expenditures of approximately nature(e.g.,owner,operator,transporter,or generator),and the $485 million in 1996. extent(e.g.,amount and nature of waste hauled to the location, The Company has filed suit against numerous insurance number of years of site operation by the Company,or other rele- carriers seeking reimbursement for past and future remedial, vant factors)of the Company's alleged connection with the site, defense and tort costs at a number of sites.The carriers involved the accuracy and strength of evidence connecting the Company have denied coverage and are defending these claims.No amounts to the location,the number,connection and financial ability have been recognized in the financial statements for any future of other named and unnamed potentially responsible parries insurance recoveries. ("PRPs"),and the nature and estimated cost of the likely remedy. The Company and certain of its subsidiaries are named as defen- Where the Company concludes that it is probable that a liability dants in personal injury and property damage lawsuits,including has been incurred,provision is made in the financial statements. purported class actions,on the basis of a Company subsidiary's Cost estimates are based upon management's judgment and expe- having owned,operated or transported waste to a disposal facility rience in remediating such sites for the Company as well as for which is alleged to have contaminated the environment or,in cer- unrelated parties,information available from regulatory agencies tain cases,conducted environmental remediation activities at such as to cost of remediation,and the number,financial resources sites. See"Financial Condition—Risks and Uncertainties." Financial Condition Liquidity and Capital Resources The Company had working defines as"owners'cash flow," is available to make acquisitions, capital deficits of$400.1 million at December 31, 1995,and reduce debt,or repurchase common stock.The Company has $115.6 million at December 31, 1994,the result of emphasis on increased its emphasis on raising the level of owners'cash flow, minimizing working capital requirements.The Company operates which was$518 million in 1995 and,based on budgeted levels in a service industry with neither significant inventory nor sea- of net income,capital expenditures net of dispositions, and conal variation in receivables,and accordingly,minimizing working capital,is expected to exceed$600 million in 1996.The working capital typically does not significantly affect operations. Company believes that it has adequate liquidity and resources Cash flow from operating activities,less net capital expenditures to meet its current needs for replacement capital and finance (other than acquisitions)and dividends,which the Company anticipated growth. 22 Acquisitions and Capital Expenditures Capital expenditures, The Boards of Directors of WMX and WTI have authorized their including$443.5 million, $56.8 million and$154.1 million for respective compa-lies to repurchase shares of their own common property and equipment of purchased businesses in 1993,1994 stock(up to 25 million shares in the case of WMX and 20 million and 1995,respectively,are shown in the following table shares in the case of WTI)in the open market or in privately ($000's omitted): negotiated transactions.These programs extend into 1997. WTI repurchased approximately 3.3 million shares in 1994 and approx- imately 7.2 million shares in 1995.WMX has not repurchased any Land(primarily of its shares in the last two years. clispo�,al sites) $ 660,226 $ 582,287 $ 517,162 During 1994 and 1995,in conjunction with its authorized Buildings and leasehold repurchase program,WMX sold put options on 31.6 million shares improvements 195,472 141,164 148,818 of its common stock.The put options give the holders the right at Vehicles 373,055 226,005 345,768 maturity to require the Company to repurchase its shares at spect- Containers 231,586 167,936 181,225 fied prices. Proceeds from the sale of put options are credited to Other equipment 702,374 _395,022 348,102 additional paid-in capital.In the event the options are exercised, Total 52,162,713 $1,512,414 $1.541,075 the Company may elect to pay the holder in cash the difference between the strike price and the market price of the Company's During 1993,the Company and its principal subsidiaries acquired shares,in lieu of repurchasing the stock. 189 businesses for$715.7 million in cash and debt(including debt Options on 17.9 million shares expired unexercised,as the assumed), 1,046,801 shares of WMX common stock and 1,635,471 price of the Company's stock was in excess of the strike price shares of WTI common stock.During 1994,119 businesses were at maturity. Options on 4.7 million shares were exercised in acquired for$214.5 million in cash and debt(including debt February 1995, and the Company elected to settle them for cash assumed),73,809 shares of the Company's common stock and in the amount of.$12.0 million.which was charged to paid-in 156,124 shares of WTI common stock. 136 businesses were capital.The remaining 9.0 million options expire at various dates acquired in 1995 for$302.0 million in cash and debt(including in 1996, at strike prices ranging from$27.34 to$31.45 per share. debt assumed)and 2,236,354 shares of the Company's common The Company may sell additional put options in 1996. stock.The Board of Directors has approved a capital expenditure During 1994,the Company formed an Employee Stock Benefit budget of 51.2 billion(excluding acquisitions)for 1996.The Trust and sold 12.6 million shares of treasury stock to the Trust in Company currently expects to finance capital expenditures,as return for a 30-year,7.33%note with interest payable quarterly and well as any acquisition activity,through cash Flow from operations. principal due at maturity.The Company has agreed to contribute The Company believes that it has adequate resources to finance to the Trust each quarter funds sufficient,when added to dividends any attractive acquisitions that become available. on the shares held by the Trust,to pay interest on the note as well Capital Structure Through 1993,the Company financed capital as principal outstanding at maturity.At the direction of an adminis- expenditures and acquisitions primarily through the use of debt, trative committee comprised of Company officers,the Trustee will taking advantage of favorable interest rates. Beginning in 1994, use the shares or proceeds from the sale of shares to pay employee increased emphasis has been placed on cash Flow and reducing benefits,and to the extent of such payments by the Trust,the leverage.The following table reflects the impact of these strate- Company will forgive principal and interest on the note. gies. However,although the Company generated$518 million Risks and Uncertainties During the first quarter of 1995, of owners'cash flow in 1995,the debt to equity ratios were WM International received an assessment of approximately adversely impacted by the purchase, discussed below,of the 417 million Krona(approximately$62 million)from the Swedish public snares of CWM and Rust,as these transactions reduced Tax Authority, relating to a transaction completed in 1990.WM minority interest and increased debt. International believes that all appropriate tax returns and disclo- Dcsember 31 1993 1994 1991 sures were filed at the time of transaction and intends to vigorously contest the assessment. Long-term debt as a percent A subsidiary of WMI has been involved in litigation challenging of total capital 49.41% 45.6% 46.5°% a municipal zoning ordinance which restricted the height of its Short-term and long-term debt New Milford,Connecticut landfill to a level below that allowed as a percent of short-term debt by the permit previously issued by the Connecticut Department and total capital 525% 49.4% 50.7% of Environmental Protection("DEF").Although a lower Court had The above ratios include minority interest in subsidiaries declared the zoning ordinance's height limitation unconstitutional, and put options as part of total capital,and exclude project debt during 1995 the Connecticut Supreme Court reversed this ruling of WTI.A significant portion of WTI's debt is project debt,the and remanded the case for further proceedings in the Superior interest and principal of which is expected to he paid by cash Court.In November 1995,the Superior Court ordered the WMI g P specific generated from operations of s Pecific projects. subsidiary to apply to the DEP for permission to remove all waste In January 1995,the Company acquired all of the approximately above the height allowed by the zoning ordinance.The Company 21.400%%of the outstanding shares of CWM that it did not already believes that removal of such waste is an inappropriate remedy own, in return for convertible subordinated debt(see Note 5 to and has appealed the Superior Court order to the state Supreme Consolidated Financial Statements). In July 1995,WMX acquired Court.The Company is unable to predict the outcome of the the approximately 3.1 million Rust shares held by the public for $16.35 per share in cash. 29 appeal or the nature and extent of the removal action that may or other third parties,among other things.Accordingly,it is possi- ultimately be required following further appeals or as a result of ble such matters could have a material adverse impact on the the permitting process. However,if the Superior Court order as to Company's earnings for one or more fiscal quarters or years. removal of the waste is not modified,the subsidiary could incur In the ordinary course of conducting its business,the Company substantial costs,which could vary significantly,depending upon becomes involved in lawsuits,administrative proceedings and the nature of any plan which is eventually approved by applica- governmental investigations,including antitrust and environmen- ble regulatory authorities for removing the waste,the actual tal matters. Some of these proceedings may result in fines, volume of waste to be moved, and other currently unforeseeable penalties or judgments heing assessed against the Company factors,and which could have a material adverse effect on the which,from time to time,may have an impact on earnings for Company's financial condition and results of operations in one a particular quarter or year.The Company does not believe that or more future periods. these proceedings,individually or in the aggregate, are material Since 1994,WTI had been involved in litigation concerning per- to its business or financial condition. mits for the construction and operation of the Lisbon,Connecticut, Outlook Although the Company believes that the actions trash-to-energy plant.These matters were resolved during 1995 taken over the past three years position it for Long-term growth and the plant began commercial operations in January 1996. and improved profitability From time to time,the Company and certain of its subsidiaries n a rapidly changing environmental are named as defendants in personal injury and property damage services market,a number of challenges remain.The current lawsuits, including purported class actions,on the basis of a low level of recyclable commodity prices and severe weather in Company subsidiary's having owned,operated or transposed many portions of the united States at the beginning of 1996 have waste to a disposal facility which is alleged to have contaminated adversely impacted WMI. s, a result ve slow growth in the domes- the environment or, in certain cases,conducted environmental tic trash-to-energywee margin business, sines revenue mix has been shifting remediation activities at such sites. Some of such lawsuits may to the lower margin water business. Consequently WTI manage- remediation seek to have the Company or its subsidiaries pay the cost of WM Noes not anticipate est earnings growth in excess of 10/n groundwater monitoring and health care examinations of WM Internacional continues to confront political and economic allegedly affected persons for a substantial period of time,even uncertainty in some of its largest markets. is where no actual damage is proven.While the Company believes To the extent they are within its control,the Company that it has meritorious defenses to these lawsuits,their ultimate responding to these challenges with increased management focus resolution is often substantially uncertain due to the difficulty of ogyon core businesses,higher onamong productivity through use of Increatechnsed the cause,extent and impact of alleged contamina- em and greater coordination among business units.Increased tion(which may have occurred over a long period of time),the emphasis is also being placed t cash Clow and control of capital potential for successive groups of complainants to emerge,the expenditures.However, in Light of the risk factors highlighted above,the Company anticipates that fore earnings per share diversity of the individual plaintiffs'circumstances,and the poten- tial contribution or indemnification obligations of co-defendants growth e range continuing operations before special charges)will g he in the range of 5%to 10%(S1.87 to$1.96). Report of Independent Public Accountants To the Stockholders and the Board of Directors of WMX Technologies,Inc.: We have audited the accompanying consolidated balance sheets In our opinion,the financial statements referred to above present of WMX Technologies, Inc. (a Delaware corporation)and fairly,in all material respects,the financial position of WMX Subsidiaries as of December 31, 1994 and 1995, and the related Technologies,Inc. and Subsidiaries as of December 31, 1994 and consolidated statements of income,cash flows,and stockholders' 1995,and the results of their operations and their cash flows for equity for each of the three years in the period ended December each of the three years in the period ended December 31, 1995 in 31,1995.These financial statements are the responsibility of the conformity with generally accepted accounting principles. Company's management. Our responsibility is to express an opin- ion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards.Those standards require that we plan and per- form the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.An audit Arthur Andersen LLP includes examining,on a test basis,evidence supporting the amounts and disclosures in the financial statements.An audit also includes assessing the accounting principles used and significant estimates made by management,as well as evaluating the overall financial statement presentation.We believe that our audits pro- Chicago,Illinois vide a reasonable basis for our opinion. February 5, 1996 2a W NIX Te hr ologies,Inc.and Suhsidiarics Consolidated Statements of Income For the three vears ended December 31,1995 (000's omitted except per share amounts) 1993 1994 1995 Revenue _ _ _ _ $8,636,116 $9,554,705 $10,247,617 Operating Expenses $5,907,097 56,543,687 $ 7,045,070 Special Charges 550,000 335.193 Goodwill Amortization 92,994 108,093 117,482 Selling and Administrative Expenses 1,104,024 1,159,500 1,174,636 Gains from Stock Transactions of Subsidiaries (15,109) — InterestExpense 293,040 335,175 424,736 Interest Income (41,198) (34,488) (39,804) Minority Interest 52,749 145,760 94359 Sundry Income, set 95,779) (66,487) (75,688) - Income From Continuing Operations Before Income Taxes S 788.298 $1,363,465 $ 1,171,633 Provision For Income Taxes 345,867 586,974 517,043 Income From Continuing Operations $ 442,431 S 776,491 $ 654,590 Discontnued Operations: Income from operations,less applicable income taxes and minority interest of 515,765 in 1993, S1I,757 in 1994 and$15,040 in 1995 S 10,345 $ 7,890 $ 11,958 Provision for loss on disposal,less applicable income tax benefit and minority interest of 534,151 - — (62,649) Net Income $ 452,776 S 784,381 $ 603,899 Average Common and Common Equivalent Shares Outstanding 485374 484,144 485,972 Earnings per Common and Common Equivalent Share. Continuing Operations 5.91 $1.60 51.35 Discontinued Operations-- Income from operations .02 .02 .02 Provision for loss - (13) Net Income $.93 $1.62 $124 The accompanying notes are an integral part of these statements. • 25 WMX Technologies,Inc.and Subsidiaries Consolidated Balance Sheets As of December 31. 1994 and 1995 ($000's omitted except per share amounts) 1994 1995 Current Assets Cash and cash equivalents S 123,348 S 189,031 Short-term investments 19,704 36,243 Accounts receivable,less reserve of $64,361 in 1994 and$66,840 in 1995 1,878,064 1,880,934 Employee receivables 9,859 8,787 Parts and supplies 194,445 210,864 Costs and estimated earnings in excess of billings on uncompleted contracts 347,064 334,786 Prepaid expenses -_ _379,895 360,404 Total Current Assets $ 2,952,379 $ 3,021,049 Property and Equipment,at cost Land,primarily disposal sites $ 4,158,612 $ 4,575,117 Buildings 1,332,568 1,572,821 Vehicles and equipment 7,118,714 7,498,718 Leasehold improvements 91,180 - 87,986 $12,701,074 $13,734,642 Less-Accumulated depreciation and amortization (3,477,317) (3,968,943) Total Property and Equipment,Net $ 9,223,757 $ 9,765,699 Other Assets Intangible assets relating to acquired businesses,net S 3,718,282 $ 4,205,031 Sundry,including other investments 1,345,104 1,572,977 Net assets of discontinued operations _ 183,651 130,552 Total Other Assets $ 5,247,037 _ $ 5,908,560 Total Assets $17,423,173 518,695,308 Current Liabilities Portion of long-term debt payable within one year $ 89086 - $ 1,094,165 Accounts payable 971,796 1,072,372 Accrued expenses 940,507 991,539 Unearned revenue 265,024 263,029 Total Current Liabilities $ 3,068,013 $ 3,421,105 Deferred Items Income taxes $ 669,566 S 956,525 Environmental liabilities 704,015 622,952 Other 607,694 _ 684,452 Total Deferred Items $ 1,981,275 $ 2,263,929 Long-Term Debt,less portion payable within one year _ _ _ $ 6,044,411 $ 6,420,610 Minority Interest in Subsidiaries - S 1,536,165 S 1,385,366 Commitments and Contingencies _ _ _ _$ _ $ Put Options - $ 252,328 $ 261,959 Stockholders'Equity Preferred stock, $1 par value(issuable in series); 50,000,000 shares authorized;none outstanding during the years $ - $ - Common stock,$1 par value;1,500,000,000 shares authorized; 496,386,758 shares issued in 1994 and 498,817,093 in 1995 496,387 498,817 Additional paid-in capital 357,150 422,801 Cumulative translation adjustment (150,832) (102,943) Retained earnings 4,181,606_ 4,486,877 $ 4,884,311 $ 5,305552 Less-1988 Employee Stock Ownership Plan 19,729 13,062 Employee Stock Benefit Trust(12,386,629 shares in 1994 and 11,769.788 in 1995,at market) 323,601 350,151 Total StockholdersEquity _. _ $ 4,540,981 $ 4,942,339 Total Liabilities and Stockholders'Equity $17,423,173 518,695,308 hc accompanying notes are an integral hart of these balance shcets. 26 WMX Technologies,Inc.and Subsidiaries Consolidated Statements of Stockholders' Equity For the Caree years ended December 31, 1995 1988 ($000's omitted except per share amounts) Employee Employee Additional Cumulative Stock Stock Common Paid-in Translation Retained Treasury Ownership Benefit Stock Capital Adjustment Earnings Stock Plan Trust Balance,January 1, 1993 $496,203 $708,296 $066,566) $3,521,190 $204,490 $34,988 $ - Net income for the year $ $ - $ - S 452,776 $ - $ - $ - Cash dividends($.58 per share) - (280,858) - Stock repurchase(8,443,400 shares) - 278.363 Stock issued upon exercise of stock options 14 (8,749) - (18,285) - Treasury stock received in connection with exercise of stock options - - 357 - .- Tax benefit of non-qualified stock options exercised - 2,825 - - Contribution to 1988 ESOP(362,036 shares) - - - - (7,329) - Treasury stock received as settlement for claims 3,429 Stock issued upon conversion of LYONS (4,553) - (7,882) Stock issued for acquisitions - (4,655) - (35,375) Transfer of equity interests among controlled subsidiaries (24,694) - - - - Cumulstive translation adjustment of fo:-eign currency statements _ 09,021) - - Balance,December 31, 1993 $496,217 S 668,470 $(245,587) $3,693,108 S 425,097 $27,659 S Net income for the year S - $ - $ - $ 784,381 5 - 5 - $ - Cash dividends(S.60 per share) - (290,266) - Dividends paid to Employee Stock Benefit Trust - 5,617 (5,617) - Stock issued upon exercise of stock options (5,948) (8,250) (5,928) Treasury stock received in connection with exercise of stock options - - 260 Tax benefit of non-qualified stock options exercised - 1,527 - - .- Contribution to 1988 ESOP(375,312 shares) - - - - (7,930) -- Treasury stock received as settlement for claims 2'41 Stock issued upon conversion of LYONS 96 1,442 (56) - - Common stock issued for acquisitions 74 1,471 Temporary equity related to put options - (252,328) - - - - _- Proceeds from sale of put options - 29,965 - - - Sale of shares to Employee Stock Benefit Trust (12,601,609 shares) - (106,327) (419,792) - 313,465 Adjustment of Employee Stock Benefit Trust to market value - 16,064 - - - - 16,064 Transfer of equity interests among controlled subsidiaries - (2,803) - Cumulative translation adjustment of foreign currency statements 94,755 - - - -- Balance„December 31,1994 $496,387 $357,150 5050,832) $4,181,606 $ - $19,729 $323,601 Net income for the year $ - $ S $ 603,899 S - $ - S - Cash dividends(S.60 per share) - (291,421) - - Dividends paid to Employee Stock Benefit Trust - 7,207 (7,207) Stock issued upon exercise of stock options 44 (4,405) (1,763) (17,393) Treasury stock received in connection with exercise of stock options - 663 Tax benefit of non-qualified stock options exercised - 2,049 Contribution to 1988 ESOP(322,508 shares) - - - - - (6,667) -- Treasury stock received as settlement for claims 1.100 Common stock issued upon conversion of LYONS 150 2.448 - - Common stock issued for acquisitions 2,236 13,908 - Temporary equity related to put options (9,631) Proceeds from sale of put options 21,622 - Settlement of put options (12,019) Adjustment of Employee Stock Benefit Tmst - - to market value 43,943 - 43,943 Transfer of equity interests among controlled subsidiaries 529 - - - Cumulative translation adjustment of foreign currency statements - - 47,889 Balance,December3l,1995 $498,817 $422,801 S(102,943) 54,486,877 S - $t3,o62 S350,151 1'1e accompanying notes are an integral partofthese statements -- WMX Technologies,Inc.and Subsidiaries Consolidated Statements of Cash Flows For the three years ended December 31,1995 Increase(Decrease)in cash($000's omitted) 1993 _ _ 1994 1995 Cash flows from operating activities: Net income for the year $ 452,776 $ 784,381 $ 603,899 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 796,691 880,466 885,384 Provision for deferred income taxes 154,782 298,564 250,828 Minority interest in subsidiaries 57,986 149,703 13802 Interest on Liquid Yield Option Notes(LYONS) and WMX Subordinated Notes 37,162 33,551 23,021 Gain on sale of property and equipment,and of investments by subsidiary (1061) (14,876) (9,190) Contribution to 1988 Employee Stock Ownership Plan 7,329 7,930 6,667 Gains from stock transactions of subsidiaries (15,109) Special charges,net of tax and minority interest 285,300 - 202,492 Provision for loss on disposal of discontinued operations, net of tax and minority interest - - 62,649 Changes in assets and liabilities, excluding effects of acquired companies: Receivables,net (112,489) (133,506) 45,232 Other current assets 41,038 (109,174) 48,214 Sundry other assets (29,445) (42,195) (72,282) Accounts payable 33,328 155,254 39,669 Accrued expenses and unearned revenue (298,214) 43,121 (227,700) Deferred items (24,015) (259,020) 61,557 Minority interest in subsidiaries (2,021) - 14,038 (3,854) Net casbprovided by operating activities S 1,371,038 S 1,808,237 S 2,054,748 Cash flows from investing activities: Short-term investments $ 35,911 $ 2,755 $ (4,196) Capital expenditures (1,719,178) (1,455,628) (1,386,932) Proceeds from sale of property and equipment,and of investments by subsidiary 134,169 276,822 141,774 Cost of acquisitions,net of cash acquired (581,745) (197,201) (224,304) Other investments (185,256) (74,446) (44,193) Acquisition of minority interests _ (129,524) (8,200) (68,370) Net casb usedfor investing activities $(2,445,623) 5(1,455,898) $(1,586,221) The accompanying notes are an integral pan of these statements. 28 1993 1994 1995 Cash flows from financing activities: Cash dividends $ (280'858) S (290,266) $ (291.421) Proceeds from issuance of indebtedness 3,407,759 1,710,586 1,803,383 Repayments of indebtedness (1,682,950) (1,752,552) (1,860,451) Proceeds from exercise of.stock options,net 9,193 7,970 14,132 Contributions from minority interests 28,072 22,169 24,394 Stock repurchases by Company and subsidiaries (315,302) (4065) (102,484) Preferred stock redemption by subsidiary (5,000) — — Proceeds from sale of put options — 29,965 21,622 Settlement of put options — (12,019) Netcasbprovidedby(usedfor)jinancing activities $ 1,160,914 $ (321,793) _ $ (4102,844) Net increase in cash and cash equivalents $ 86,329 $ 30'546 S 65,683 Cash and cash equivalents at beginning of year 6,473 92,802 123,348 _ Y $ 92,802 $ 123,348 $ 189,031 Cash and cash equivalents at end of year < The Company considers cash and cash equivalents to incl-,tde currency on hand,demand deposits with banks and short-term investments with maturities of less than three months when purchased. Supplemental disclosures of cash flow information Cash paid during the year for: Interest,net of amounts capitalized $ 263,716 $ 307,257 $ 401.715 Income taxes,net of refunds received $ 331,803 $ 241,657 $ 283,165 Supplemental schedule of noncash investing and financing activities: LYONS converted into common stock of the Company $ 3,329 S 1,594 $ 2.598 Liabilities assumed in acquisitions of businesses $ 673,129 $ 244,560 $ 245.918 Fair market value of Company and subsidiary stock issued for acquired businesses S 64,500 $ 4,773 S 66,172 WMX Subordinated Notes issued for acquisition of CWM minority interest $ — $ $ 436,830 • 29 WMX Technologies,Inc,and Subsidiaries Notes to Consolidated Financial Statements (oxo°s ontatea in all tables except(xrsbare amunt') NOTE 1 Business and Financial Statements WMX Technologies,Inc.and its subsidiaries("WMX"or the The accompanying financial statements are prepared on a 'Company')provide environmental,engineering and consulting, consolidated basis and include the Company and its majority- and industrial services to governmental,residential,commercial, owned subsidiaries.All significant intercompany transactions and industrial customers on a worldwide basis in four core lines and balances have been eliminated. See Note 13 for details of of business:waste services,dean energy,dean water,and envi- certain financial information by subsidiary,line of business and ronmental and infrastructure engineering and consulting.Through geographic area. 1995,process engineering,construction,specialty contracting The preparation of financial statements in conformity with gen- and similar services were also provided through businesses the erally accepted accounting principles requires management to Company intends to exit(see Note 15).These businesses have make estimates and assumptions that affect reported amounts of been classified as discontinued operations and are segregated assets,liabilities,income and expenses and disclosures of contin- from continuing operations in the accompanying financial genies. Future events could alter such estimates in the near term. statements and notes thereto. NOTE 2 Summary of Accounting Policies Revenue Recognition The Company recognizes revenue from Contracts in Process Information with respect to contracts in long-term contracts on the percentage-of-completion basis with process at December 31,1994 and 1995 is as follows: losses recognized in full when identified.Changes in project per- formance and conditions,estimated profitability and final contract 1994 1995 settlements may result in future revisions to costs and income. Costs and estimated earnings Other revenues are recognized when the services are performed. on uncompleted contracts $2,618,921 $2,510,898 Less:Billings on uncompleted contracts (2,365,334) (2,253,867) Foreign Currency Certain foreign subsidiaries'assets and liabilities are translated at the rates of exchange at the balance Total contracts in process $ 253,587 $ 257,031 sheet date while income statement accounts are translated at the Contracts in process are included in the Consolidated Balance average exchange rates in effect during the period.The resulting Sheets under the following captions: translation adjustments are charged or credited directly to stock- holders'equity. Foreign exchange losses(net of related income Costs and estimated earnings taxes and minority interest)of$529,000,$3,610,000 and$1,226,000 in excess of billings on are included in the Consolidated Statements of Income for 1993, uncompleted contracts $347,064 $334,786 1994 and 1995,respectively. Billings in excess of costs and estimated earnings Short-Term Investments The Company's short-term investments on uncompleted contracts primarily consist of securities having an investment grade of not (included in unearned revenue) (93,477) (77,755) less than A and a term to maturity generally of less than one year, and because the investments have always been held to maturity, Total contracts in process $253,557 $257,031 are carried at cost.Such investments include tax-exempt securi- All contracts in process are expected to be billed and collected ties, certificates of deposit and Eurodollar time deposits. within five years. Effective January 1,1994,the Company adopted Statement of Accounts receivable includes retainage which has been Financial Accounting Standards("FAS")No.115, "Accounting for billed,but which is not due pursuant to contract provisions until Certain Investments in Debt and Equity Securities."The adoption completion.Such retainage at December 31,1995,is$23,095,000, of FAS 115 did not have a significant effect on earnings for 1994, including$6,724,000 that is expected to be collected after one year. since the Company's accounting prior to adoption was substan- At December 31,1994,retainage was$33,743,000. tially in compliance with the new standard. Property and Equdprueut Property and equipment(including Enviromnetdalliabilities The Company provides for estimated major repairs and improvements)are capitalized and stated closure and post-closure monitoring costs over the operating life at cost.Items of an ordinary maintenance or repair nature are of disposal sites as airspace is consumed.The Company has also charged directly to operations.Disposal sites are carried at cost established procedures to evaluate potential remedial liabilities at and to the extent this exceeds end use realizable value,such closed sites which it owns or operated,or to which it transported excess is amortized over the estimated life of the disposal site. waste,including 106 sites listed on the Superfund National Priority Disposal site improvement costs are capitalized and charged to List("NPL").Where the Company concludes that it is probable that operations over the shorter of the estimated usable life of the a liability has been incurred,provision is made in the financial state- site or the improvement. merits,based upon management's judgment and prior experience, Preparation costs for individual secure land disposal cells are for the Company's best estimate of the liability.Such estimates are recorded as prepaid expenses and amortized as the airspace is subsequently revised as deemed necessary as additional informa- filled.Significant costs capitalized for such cells include excavation tion becomes available.See Note 7 for additional information. and grading costs,costs relating to the design and construction of liner systems,and gas collection and Leachate collection systems. Unamortized cell construction cost at December 31, 1994 and 1995 was$154,100,000 and$187,689,000,respectively. is Depreciation andAnu rtization The cost,less estimated Gain Recognition on Sale of Subsidiaries'Stock It is the salvage value,of property and equipment is depreciated over Company's policy to record in income gains from the sale or other the estimated useful lives on the straight-line method as follows: issuance of previously unissued stock by its subsidiaries.No such buildings-10 to 40 years;vehicles and equipment-3 to 20 years; gains were recorded in 1994 or 1995. leasehold improvements-over the life of the applicable lease. Accounting Principles The Financial Accounting Standards Board Intangible Assets Intangible assets relating to acquired husi- ("FASB")has issued FAS No. 121, "Accounting for the Impairment nesses consist primarily of the cost of purchased businesses in of Long-Lived Assets and for Long-Lived Assets to be Disposed Of,' excess of market value of net assets acquired(`goodwill'). Such which is effective for fiscat years beginning after December 15,1995. goodwill is being amortized on a straight-line hasis over a period The Company does not believe the adoption of FAS 121 will have of not more than forty years.The accumulated amortization of a material impact on the financial statements. intangible assets amounted to$458,167,000 and $572,587,000 as in October 1995,the FASB issued FAS No. 123,"Accounting for of December 31,1994 and 1995,respectively. Stock-Based Compensation,"which the Company also must adopt On an ongoing basis,the Company measures realizability of in 1996.FAS 123 provides an optional new method of accounting goodwill by the ability of the acquired business to generate current for employee stock:options and expands required disclosure about and expected future operating income in excess of annual amorti- stock options.If the new method of accounting is not adopted,the zation.If such realizability is in doubt,an adjustment is made to Company will be required to disclose pro forma net income and reduce the carrying value of the goodwill.Such adjustments have earnings per share as if it were.The Company is studying FAS 123 historically not been material to the Company's financial statements, and is gathering data necessary to calculate compensation in accor- Capitalizedlntemst Interest has been capitalized on significant dance with its provisions,but has not decided whether to adopt the new method or quantified its impact on the financial statements. landfills, trash-to-energy plants and other projects under construc- tion in accordance with FAS No. 34.Amounts capitalized and Restatement Certain amounts in previously issued financial netted against Interest Expense in the Consolidated Statements statements have been restated to conform to 1995 classifications. of Income were$100,591,000 in 1993, $104,512,000 in 1994 and $81,471,000 in 1995. NOTE 3 Income Taxes The following tables set forth income from continuing operations and the income tar:provision, showing the components by gov- before income taxes,showing domestic and international sources, ernmental taxing authority,for the years 1993 through 1995: Income From Continuing Operations Before Income Taxes 1993 1994 1995 Domestic $616,805 $1,187,938 .$1,167,120 International 171,493 _175,527 4,513 $788,298 51,363,465 $1,171,633 Income Tax Provision(Benefit) --- - Current tax expense U.S.Federal $133,581 $ 215,569 5 224,924 State and local 29,893 4$549 48,957 Foreign _36,410 3011 42,810 Total current $199,884 S 295,729 $ 316,691 Deferred tax expense U.S.Federal $ 87,792 $ 215,644 $ 18L873 State and local 29,464 33,689 36,101 Foreign 32,327 _ 44,507 (16,538) Total deferred $149,583 $ 293,840 $__2.01,436 U.S. Federal benefit from amortization of deferred investment credit $ (3,600) S (2,595) $ (1,084) Total provision $345,867 5 586,974 $ 517,043 The Federal statutory tax rate in 1993, 1994 and 1995 is reconciled to the effective tax rate as follows: Federal statutory rate 35.0% 35.0""% 35.0% State and local taxes,net of Federal benefit 4.9 4.0 4J Amortization of deferred investment credit (0.4) (0.2) (0.1) Amortization of intangible assets relating to acquired businesses 4.2 2.2 2.8 Federal tax credits (1.4) (1.0) (1.2) Non-taxable gains on issuance of stock by subsidiaries (0.7) Minority interest 2.8 4,2 3.3 Adjustment of deferred income taxes due to Omnibus Budget Reconciliation Act 1.8 — Other,net (2.3) (1.11 (0.4) Effective tax rate 43.9% 43.1% 44 to/,, it The Company uses the deferral method of accounting for The Company's subsidiaries have approximately$37 million investment credit,whereby the credit is recorded in income over of alternative minimum tax credit carryforwards that may be used ^'t the composite life of the related equipment. indefinitely.Various subsidiaries have U.S.Federal and foreign Deferred income taxes result from the recognition,in different operating loss carryforwards of approximately$530 million and periods,of revenue and expense for tax and financial statement state operating loss carryforwards of approximately$513 million. purposes.The primary components that comprise the 1994 and Foreign operating losses of$253 million may be carried forward 1995 deferred tax(assets)liabilities are as follows: indefinitely;the remaining loss carryforwards have expiration dates through the year 2010.Valuation allowances have been 1994 1995 established for uncertainties in realizing the tax benefits of loss Deferred tax assets carryforwards and for the basis difference in certain assets.While Reserves not deductible until paid $ (491,061) $ (526,202) the Company expects to realize the deferred tax assets in excess Deferred revenue (25,708) (24,472) of the valuation allowances,changes in estimates of future taxable Net operating losses and income or in tax laws could alter this expectation.The increase tax credit carryforwards (159,269) (266,898) in the valuation allowance since 1993 is primarily attributable to Other (69,812) (73,834) uncertainty in realizing the tax benefit of certain foreign operating Subtotal $ (745,850) $ (891,406) loss carryforwards. Deferred tax liabilities The Company has concluded that development and expansion Depreciation and amortization $1,103,194 $1,368,258 of its foreign business requires that the undistributed earnings Other 233,600 381,068 of its foreign subsidiaries be reinvested indefinitely outside the United States.If the reinvested earnings were to be remitted,the Subtotal $1,336,794 $1,749,326 U.S.income taxes due under current tax law would not be material. Valuation allowance($29,890,000 at December 31,1993) 78,622 98,605 Net deferred tax liabilities $ 669,566 $ 956,525 NOTE 4 Business Combinations During 1993,the Company and its principal subsidiaries acquired of debt assumed,and 2,236,354 shares of the Company's common 189 businesses for$581,745,000 in cash(net of cash acquired) stock.Three of the aforementioned 1995 acquisitions,which other- and notes,$133,941,000 of debt assumed,1,046,801 shares of the wise met pooling of interests criteria,were not significant in the Company's common stock and 1,635,471 shares of common stock aggregate and,consequently,prior period financial statements of Wheelabrator Technologies Inc.("WTI").These acquisitions were not restated.The remaining acquisitions were accounted were accounted for as purchases. for as purchases. During 1994, 119 businesses were acquired for$197,201,000 The following summarizes the pro forma effect on continuing in cash(net of cash acquired)and notes,$17,305,000 of debt operations of businesses acquired and accounted for as purchases assumed,73,809 shares of the Company's common stock and (including those which otherwise met pooling of interests criteria 156,124 shares of common stock of WTI.These acquisitions were but were not significant in the aggregate)in 1993, 1994 and 1995 accounted for as purchases. as if they had been acquired as of January 1 of the preceding One hundred thirty-six businesses were acquired in 1995 for year(unaudited): $224,304,000 in cash(net of cash acquired)and notes, $77,689,000 1993 1994 1995 Revenue as reported $8,636,116 $ 9,554,705 $10,247,617 Revenue of purchased businesses for period prior to acquisition as stated above 555,218 477,040 161,868 Pro forma revenue $9,191,334 $10,031,745 $10,409,485 Net income as reported $ 442,431 $ 776,491 $ 654,590 Net income of purchased businesses for period prior to acquisition as stated above 9,753 32,408 7,237 Adjustment for interest and goodwill amortization (18,532) (29,066) (7,649) Pro forma net income $ 433,652 $ 779,833 $ 654,178 Earnings per share as reported $.91 S1.60 $1.35 Effect of purchased businesses prior to acquisition as stated above (02) _ 01 Pro forma earnings per share $.89 $1.61 $1.35 In January 1995,the Company acquired all of the approximately WMX note for every 81.1 CWM shares held.See Note 5 for addi- 21.4%of the outstanding shares of Chemical Waste Management,Inc. tional information.In July 1995,the Company acquired all of the ("CWM")that it did not already own.The transaction provided for approximately 31 million shares of Rust International Inc. ("Rust") the CWM public shareholders to receive a convertible subordinated held by the public,for$16.35 per share in cash. 32 NOTE 5 Debt The details relating to debt(including capitalized leases,which are not material)as of December 31, 1994 and 1995,are as follows: 1994 1995 Commercial Paper,weighted average interest 5.844,in 1994 and 5.7°/i in 1995 S 9'i6,702 $1,119,356 Tailored Rate ESOP Notes,weighted average interest 4.81°/,in 1994 and 4.740/)in 1995 50,000 20,000 Debentures, interest 8%°/n.,due 2018 249,085 249,085 Notes,in:erest4/%,to8/%,due 1996-2011 2,684,170 3,184,170 Step-Up ISotes,interest 6.2295 through April 29, 1997 and 8%thereafter,due 2004 150'000 150,000 Solid waste disposal revenue bonds, interest 6°%to 7.75000A,due 1996-2013 252,385 251.085 Installment loans and notes payable,interest 534'11 to 10.6%,due 1996-2020 11298,436 1,233,871 Project Debt, interest 4%to 10.64°11,due 1996-2010 764,859 735,646 Other long-term borrowings 34,320 32,210 Liquid Yield Option Notes,Zero coupon-subordinated,interest 9%,due 2001 10,721 8,945 Liquid Yield Option Notes,zero coupon-subordinated,interest 01%,due 2012("Exchangeable LYONS' 301,438 53,996 Liquid Yield Option Notes,zero coupon-subordinated,interest 6%,due 2010(`CWM LYONs') 132,981 36,840 WMX Subordinated Notes,interest 5.75°/q due 2005 4395'1 'Total deft $6935,097 $7,514,775 Less�cu n cut portion 890,686 1,094,165 Long-term portion $6,044,411 $6,420,610 The long-term debt as of December 31,1995,is due as follows: annum(determined on a serni-annual bond equivalent basis)for purposes'of determining the prices atwhich WMX may purchase Second year 5 761,091 or redeem notes,as described below.At the option of the holder, Third year 2,158,232 Fourth year each note will be purchased for cash by WMX on March 15, 1998, , and March 15,2000'at prices of$789.95 and$843.03,respectively, Sixth year Fifth Iyear and thereafter 132,816 261103 132 816 which represent the stated issue price plus accrued stated discount 2,107 368 to those dates Accrued unpaid interest to those dates will also be $6,420 610 paid.The notes will be redeemable by WMX on and after March Certain of the Company's borrowings are redeemable at the 15, 2000,for cash,at the stated issue price plus accrued stated option of the holders prior to maturity.Such amounts and certain discount and accrued but unpaid interest through the date of other borrowings which would otherwise be classified as current redemption. to addition,each note is convertible at any time prior liabilities have been classified as long-term debt because the to maturity,unless previously purchased or redeemed by WMX, Company intends to refinance such borrowings on a longterm into 26.078 shares of WMX common stock,subject to adjustment basis with$1,503,000,000 of committed long-term borrowing facili- upon the occurrence of certain events. Upon any such conversion, ties which it has available The committed facilities provide for WMX will have the option of paying cash equal to the market unsecured long-term loans at interest rates of prime or LIBOR value of dtc WMX shares which would otherwise be issuable. plus 30 basis points and commitment fees of 6 to 8 basis points ,4s of December 31, 1995,there were 549,810 such notes outstand- per annum.There are no compensating balance requirements mg with a maturity value amounting to$549.810,000. or any informal arrangements'in connection with loans which As of December 31, 1994,CWM LYONS and the Exchangeable would be made under these facilities. LYONS(together with the CWM LYONS,the"LYONS")were con- InJanuary 1995,the Company acquired the outstanding CWM verdble into or exchangeable for CNVM shares. On January 24, 1995, shares it did not already own.The transaction provided forttte the LYONS became convertible into the number of notes discussed CNV)I public shareholders to receive a convertible subordinated in the preceding paragraph to which the holders would have been WMX note due 2005, with a principal amount at maturity of entitled had they convened or exchanged the LYONS immediately S1,000,for every 81.1 CWM shares held,with cash paid in lieu prior to the merger appi oval. of issuance of fractional notes.The notes are subordinated to all In May 1994,the Company issued, at par, $150,000,000 of ten- existing and furore senior indebtedness of WKLY.Each note bears year Step-Up Notes due April 30, 2004.The holders may elect to cash interest from January 24, 1995 at the rate of two percent per have the Step-Up Notes or any portion thereof repaid on April 30, 1997,at 100°io of their principal amount together with accrued annum of the$1,000 principal amount at maturity,payable semi- interest The interest rate on the Step-Up Notes is 6.22%through annually.The difference between the principal amountte maturity April 29, 1997,and 8%thereafter. In November 1994,the Company se s the and the s717B0 stated issue price of each note tepee- issuect S200,,000.000 of 8'/%Notes due November 15, 1999, at cents the stated discount which,together with the cash interest p a arable on the notes,will accrue at rate of 5.75 percent per a price of 99.925%. Neither of these issues is redeemable at the " • option of the Company prior to maturity. 33 In January 1995,the Company issued$250,000,000 of 81M/o Notes amount,together with accrued interest.The Company also issued --a due February 1, 1998,at a price of 99.671%.In March 1995,the in May 1995,$100,000,000 of 7%Notes due May 15,2005,at a price Company issued$200,000,000 of TM/o Notes due March 22, 1997,at of 99.293%. In June 1995,the Company issued$100,000,000 of a price of 99.98%.In May 1995,the Company issued$200,000,000 5.84%Notes due July 3, 1996,at par.In October 1995,the Company of 6.65%Notes due May 15,2005,at par.The holder of each 6.65% issued 5250,000,000 of 6L,o/o Notes due October 15,2000,at a price Note may elect to have such Note,or any portion thereof which is a of 99.85°/x.None of these issues is redeemable at the option of the multiple of$1,000,repaid on May 15,2000 at 100%of its principal Company prior to maturity. NOTE 6 Derivative Financial Instruments From time to time,the Company uses derivatives to manage and do not represent the amount of exposure to credit loss. interest rate,currency and commodity risk.The portfolio of such The agreements provide only for the exchange of interest on the instruments(which are held for purposes other than trading)at notional amounts at the stated rates,with no multipliers or leverage. December 31, 1995,is set forth in the paragraphs which follow. While the subsidiaries are exposed to market risk to the extent Where deemed advantageous, management will use derivatives that receipts and payments under interest rate agreements are in the future. affected by market interest rates,such agreements are entered Interest Rate Agreements Certain of the Company's subsidiaries into as a hedge against interest rate exposure on existing debt. received under the agreements have entered into interest rate swap agreements to reduce the Accordingly,differences paid impact of changes in interest rates on underlying borrowings.The are recognized part t interest expense over the life the agreements are contracts to exchange fixed and floating interest agreements.Thee impact swap agreements on consolidated d rate payments periodically over the term without the exchange interest expense and on thheeeffective interest rate on consolidated debt was immaterial As of December of the underlying notional amounts.The notional amounts of such 1995,interest rate agree- agreements are used to measure interest to be paid or received menus in notional amounts and with terms as set forth in the following table were outstanding: Notional Currency Amount _ Fay Receive Duration of Agreement Sterling 20,000 Fixed Floating Feb. 1995—Feb. 1999 Hong Kong dollar 250,000 Fixed Floating Feb.1995—Feb. 1997 Currency Agreements From time to time,the Company and involving multipliers or leverage are not used.While the Company certain of its subsidiaries use foreign currency derivatives to miti- may be required to make a payment in connection with these gate the impact of translation on foreign earnings and income from agreements,it will recognize an offsetting increase in the translation foreign investees.Typically these have taken the form of purchased of foreign earnings or income from foreign investees.Although the put options or offsetting put and call options with different strike purpose for using such derivatives is to mitigate currency risk,they prices.The Company receives or pays,based on the notional do not qualify for hedge accounting under generally accepted amount of the option,the difference between the average exchange accounting principles,and accordingly must be adjusted to market rate of the hedged currency against the base currency and the aver- value at the end of each accounting period.Gains and losses on age(strike price)contained in the option.Complex instruments currency derivatives to date have not been material. As of December 31, 1995,the Company was parry to the following average rate currency option(settles at expiration): Currency Notional Amount Hedged Against Collar,structured as offsetting put and call with different strike prices,covering the period January 1 to December 31,1996 100,000 Swedish Krona Sterling 3" Significant foreign currency contracts outstanding during 1993, 1994 and 1995 were as follows Currency Average Amount Hedged Against 1993 150,000 Sterling Dollar 9,300 Deutschemark Dollar 6,000 Finland Markka Sterling 1994 85,000 Deutschemark Sterling 132,000 French Franc Sterling 184,000 Swedish Krona Sterling 20,000,000 Italian Lire Sterling 10,000,000 Italian Lire Deutschemark 23,000 Deutschemark Dollar 141,000 Sterling Dollar 1995 46,600 Deutschemark Sterling 82,000 French Franc Sterling 13,500 Netherlands Guilder Sterling 180,000 Swedish Krona Sterling 1,500 Dollar Sterling 15,267,000 Italian Lire Sterling 11,820 Deutschemark Dollar 669 Sterling Swedish Krona 35,800 Sterling Dollar Commodity Agreements The Company utilizes collars,calls and deferred and recognized as fuel is purchased.The following table swaps to mitigate the risk of price Fluctuations on the fuel used summarizes the Company's positions in commodity derivatives as by its vehicles.Quantities hedged equate to committed fuel pur- of December 31, 1995: chases or anticipated usage,and accordingly,gains and losses are Type Commodity Quantity Expiration Swaps Crude oil 3,000 bbls. 1996 Collars Crude oil 300 bids. 1996 Swaps Crude oil 3,000 bbls. 1997 Collars Crude oil 350 bbls. 1997 Swaps Crude oil 2,000 bbls. 1998 Collars Crude oil 200 bbls. 1998 Collars Crude oil 100 HAS, 1999 The Company is exposed to credit loss in the event of non-perfor- formance. Maximum credit exposure is represented by the fair mance by counterparties on interest rate,currency and commodity value of contracts with a positive fair value;at December 31, 1995, derivatives,but in all cases such counterparties are highly rated such amounts were not material. financial institutions and the Company does not anticipate non-per- NOTE 7 Environmental Costs and Liabilities The majority of the businesses in which the Company is engaged The Company provides for estimated closure and post-closure are intrinsically connected with the protection of the environment. monitoring costs over the operating life of disposal sites as airspace As such,a significant portion of the Company's operating costs is consumed Such costs for U.S.landfills are estimated based on and capital expenditures could be characterized as costs of envi- the technical requirements of the Subtitle C and D Regulations of ronmental protection.While the Company is faced,in the normal the U.S.Environmental Protection Agency or the applicable state course of business,with the need to expend funds for environ- requirements,whichever are stricter,and include such items as final mental protection and remediation, it does not expect such cap and cover on the site,methane gas and leachate management, expenditures to have a material adverse effect on its financial and groundwater monitoring.Substantially the same standards are condition or results of operations because its business is based applied to est mate costs for foreign sites,even though current upon compliance with environmental laws and regulations and regulations in some foreign jurisdictions are less strict. its services are priced accordingly. 35 The Company has also established procedures to evaluate The Company's active landfill sites have estimated remaining —� potential remedial liabli7ities at dosed sites which it owns or lives ranging from one to over 100 years based upon current site operated,or to which it transported waste,including 106 sites plans and annual volumes of waste. During this remaining site on the NPL.In the majority of situations,the Company's connection life,the Company will provide for an additional 51.12 billion of with NPL sites relates to allegations that its subsidiaries(or their closure and post-closure costs, including accretion for the dis- predecessors)transported waste to the facilities in question, count recognized to date. often prior to the acquisition of such subsidiaries by the Company. As of December 31,the Company's liabilities for closure, The Company routinely reviews and evaluates sites requiring post-closure monitoring and environmental remediation costs remediation,including NPL sites,giving consideration to the were as follows: nature(e.g,owner,operator,transporter,or generator),and the extent(e.g.,amount and nature of waste hauled to the location, 1994 1995 number of years of site operation by the Company,or other rele- Current portion,included in vant factors)of the Company's alleged connection with the site, Accred Expenses $ 108,750 S 138,603 the accuracy and strength of evidence connecting the Company to Non-current portion 704.075 - 622,952 the location,the number,connection and financial ability of other Total recorded $ 812,765 S 761.555 named and unnamed potentially responsible parties('PRPs"),and Amount to be provided over the nature and estimated cost of the likely remedy.Cost estimates remaining life of active are based on management's judgment and experience in remedial- sites,including discount ing such sites for the Company as well as for unrelated Parties, of$169 million in 1994 and information available from regulatory agencies as to costs of reme- S171 million in 1995 1,149,617 1,118,739 diation,and the number,financial resources and relative degree Expected aggregate undiscounted of responsibility of other PRPs who are jointly and severably liable environmental liabilities $1,962,382 $1,880,294 for remediation of a specific site,as well as the typical allocation — — of costs among PRPs.These estimates are sometimes a range of Anticipated payments of environmental liabilities at December 31, possible outcomes.In such cases,the Company provides for the 1995,are as follows: amount within the range which constitutes its best estimate.If no amount within the range appears to be a better estimate than 1996 $ 138,603 any other amount,then the Company provides for the minimum 1997 97,621 amount within the range in accordance with FAS No. S.The 1998 49,416 Company believes that it is"reasonably possible,"as that term 1999 40,586 is defined in FAS 5("more than remote but less than likely"), 2000 32,115 that its potential liability could be at the high end of such ranges, Thereafter 1,521,953 which would be approximately S150 million higher in the aggre- $1,880,294 gate than the estimate that has been recorded in the financial statements as of December 31, 1995. The change in the expected aggregate undiscounted amount Estimates of the extent of the Company's degree of responsibility results primarily from changes in available airspace. for remediation of a particular site and the method and ultimate cost The Company and certain of its subsidiaries are named as defen- of remediation require a number of assumptions and are inherently dants in personal injury and property damage lawsuits, including difficult,and the ultimate outcome may differ from current estimates. purported class actions,on the basis of a Company subsidiary's However,the Company believes that its extensive experience in the having owned,operated or transported waste to a disposal facility environmental services business,as well as its involvement with a which is alleged to have contaminated the environment.While the large number of sites,provides a reasonable basis for estimating its Company believes it has meritorious defenses to these lawsuits, aggregate liability.As additional information becomes available, their ultimate resolution is often substantially uncertain due to a estimates are adjusted as necessary.While the Company does not number of factors,and it is possible such matters could have a anticipate that any such adjustment would be material to its financial material adverse impact on the Company's earnings for one or statements,it is reasonably possible that technological,regulatory or more quarters or years. enforcement developments,the results of environmental studies or The Company has filed suit against numerous insurance carriers other factors could necessitate the recording of additional liabilities seeking reimbursement for past and future remedial,defense and which could be material.The impact of such future events cannot tort claim costs at a number of sites.The carriers involved have be estimated at the current time. denied coverage and are defending these claims.No amounts Where the Company believes that both the amount of a have been recognized in the financial statements for any future particular environmental liability and the timing of the payments insurance recoveries, are reliably determinable,the cost in current dollars is inflated at 3%until expected time of payment and then discounted to pre- sent value at 7%. Had the Company not discounted any portion of its liability,the amount recorded would have been increased by approximately 5171 million at December 31, 1995. 36 NOTE 8 Stock Options The Company has two stock option plans currently in effect Pursuant to the Directors'Plan,150,000 shares of the Company's under which future grants may be issued:the 1992 Stock Option common stock were initially reserved.Options for 15,000 shares Plan(the"1992 Plan")and the 1992 Stock Option Plan for are to be granted,at the time of election to the Board,to each Non-Employee Directors(the`DirectorsPlan'). person who is not an officer or full-time employee of the Company Options granted under the 1992 Plan are generally exercisable or any of its subsidiaries. in equal cumulative installments over a three-to five-year period As part of the acquisitions of the CWM and Rust shares not beginning one year after the date of grant.Options granted under previously owned by the Company, as discussed in Note 4, the Directors'Plan become exercisable in five equal annual outstanding CWM stock options were converted into options installments beginning six months after the date of grant. to acquire approximately 2,873,000 Company shares at prices Under the 1992 Plan,non-qualified stock options may be granted of$21.97 to$63.33 per share and outstanding Rust stock options at a price equal to 10000%of the market value on the date of grant, were converted into options to acquire approximately 1,976,000 for a term of not less than five years nor more than ten years. Company shares at prices of$21.39 to$40.10 per share. Twelve million five hundred thousand shares of the Company's The status of the plans, including predecessor plans and replace- common stock were initially reserved for issuance under this plan, ment plans(together"Prior Plans")under which options remain outstanding,during the three years ended December 31, 1995, was as follows: Shares Option Price January 1,1993- Outstanding 9,783 $ 3.46-$41.80 Available for future grant 14,822 - 1993- Granted 2,957 $30.90-538.45 Exercised 551 $ 3.4i6-$35.44 Cancelled Prior Plans 179 $18.84-$41.80 Current plans 328 $30.69-$41.80 December 31,1993- Outstanding 11,682 $ 4.33-$41.80 Available for future grant 12,193 - 1994- Granted 3,729 $24.33-$29.03 Exercised 402 $ 4.33-$25.72 Cancelled Prior Plans 312 $14.72-$4L80 Current plans 826 $ 8.57-$41.80 Additional shares available for future grant 6,000 - December 31, 1994- Outstanding 13,811 $ 7.20-$41.80 Available for future grant 15,290 - 1995- Granted 3,117 $23.21-$28.90 Exercised 721 $ 7.20-$30.69 Cancelled- Prior Plans 1,111 $21.39-$63.33 Current plans 316 526.48-$41.80 Converted CWM and Rust stock options 4,849 $21.39-$63.33 Shares no longer available for future grant 2,914 - December 31, 1995- Outstanding 995-Outstanding 19,629 $ 8.57-$63.33 Available for future grant 4,726 - Options were exercisable with respect to 9,859,656 shares at December 31, 1995. 37 NOTE 9 Capital Stock The Board of Directors has the authority to create and issue up to If the Company or its assets are acquired in certain merger or �.. 50,000,000 shares of$1 par preferred stock at such time or times, other transactions after a person acquires Company voting stock in such series,with such designations,preferences and relative or commences or announces an offer as provided above,each participating,optional or other special rights and qualifications, holder of a Right may purchase at the exercise price of the Right, limitations or restrictions thereof as it may determine.No shares shares of common stock of the acquiring company having a of the preferred stock have been issued. market value of two times the exercise price of the Right.If the Pursuant to a plan adopted by the Company in January 1987, Company is the survivor in certain merger transactions or in the each share of the Company's common stock carries the right event of certain other"self-dealing"transactions,each holder of (referred to herein as a"Right")to purchase one four-hundredth a Right may purchase at the exercise price of the Right,shares of (subject to adjustment)of a share of Series A Preferred Stock, Preferred Stock having a market value of twice the exercise price $1.00 par value("Preferred Stock"),at a price of$68.75(subject of the Right.Rights held by an acquiring person become void to adjustment).The Rights are tradeable only with the Company's upon the occurrence of such events. common stock until they become exercisable.The Rights become On December 8, 1995,the Board of Directors of the Company exercisable ten days after the earlier of a public announcement that authorized the repurchase by the Company of up to 25 million a person has acquired 20%or more of the Company's outstanding shares of its comon stock from time to time in the open market voting stock or a person's commencement or announcement of a or in privately negotiated transactions over a 24-month period. tender or exchange offer that would result in his owning 30%or On the same date,the Board of Directors of WTI authorized WTI more of the Company's outstanding voting stock.The Rights are to repurchase up to 20 million shares of its common stock over a subject to redemption by the Company at a price of$.0125 per Right, 24-month period.Both authorizations replaced existing common subject to certain limitations,and will expire on February 6, 1997, stock repurchase programs. The Preferred Stock carries certain preferential dividend and liquidation rights and certain voting and other rights. NOTE 10 Earnings Per Share Earnings per share are computed on the basis of the weighted _ 1994 1995 average number of common and common equivalent shares Common shares issued,net of ._.. outstanding during each year.Common stock equivalents relate Employee Stock Benefit Trust shares primarily to the impact of options outstanding under the per Consolidated Balance Sheets 484,000 487,047 Company's stock option plans. Effect of shares issuable under The following table reconciles the number of common shares stock options after applying shown as outstanding in the Consolidated Balance Sheets with the the"treasury stock"method 396 627 number of common shares used in computing earnings per share: Effect of using weighted average common shares outstanding during the year _ (252) - (1,702) Common shares used in computing earnings per share 484,144 485,972 NOTE 11 Commitments and Contingencies - The Company leases several of its operating and office facilities During 1994 and 1995,the Company sold put options on 31.6 mil- for various terms. Rents charged to costs and expenses in the lion shares of its common stock.The put options give the holders Consolidated Statements of Income amounted to 8178,039,000 the right at maturity to require the Company to repurchase shares in 1993, $197,969,000 in 1994 and$186,248,000 in 1995.These of its common stock at specified prices.Proceeds from the sale of amounts include rents under long-term leases,short-term put options were credited to additional paid-in capital.The amount cancellable leases and rents charged as a percentage of revenue, the Company would be obligated to pay to repurchase shares of its but are exclusive of financing leases capitalized for accounting common stock if all outstanding put options were exercised has purposes. been reclassified to a temporary equity account.In the event the The long-term rental obligations as of December 31, 1995, options are exercised,the Company may elect to pay the holder are due as follows: in cash the difference between the strike price and the market price First year $ 170,311 of the Company's shares,in lieu of repurchasing the stock. Second year 152 711 Options on 17.9 million shares expired unexercised in 1994 and year 140,162 1995,as the price of the Company's stock was in excess of the strike Third Thirdyear 132,892 price at maturity.Options on 4.7 million shares were exercised in Fourth Pilch year 126,872 February 1995,and the Company elected to settle them for cash at a Sixth through tenth years 545,675 total cost of$12,019,000.The remaining 9.0 million options expire Eleventh year and thereafter 329,046 at various dates in 1996,at strike prices ranging from$27.34 to $31.45 per share. $1,597,669 The Company's insurance program includes coverage for pollu- tion liability resulting from"sudden and accidental"releases of contaminants and pollutants.Management believes that the cover- age terms,available limits of liability,and costs currently offered by Sri the insurance market do not represent sufficient value to warrant A subsidiary of Waste Management,Inc. ("WMI")has been the purchase of"non-sudden and accidental"pollution liability involved in litigation challenging a municipal zoning ordinance insurance coverage.As such,the Company has chosen not to pur- which restricted the height of its New Milford,Connecticut landfill chase risk transfer"non-sudden and accidental'pollution liability to a level below that allowed by the permit previously issued by insurance coverage.To satisfy existing government requirements, the Connecticut Department of Environmental Protection("DEP"). the Company has secured non-risk transfer pollution liability insur- Although a lower court declared the zoning ordinance's height ance coverage in amounts believed to be in compliance with limitation unconstitutional,the Connecticut Supreme Court Federal and State law requirements for"non-sudden and acciden- reversed that ruling and remanded the case for further proceed- tal"pollution.The Company must reimburse the,insurer for losses ings in the Superior Court.In November 1995,the Superior Court incurred and covered by this insurance policy. In the event the ordered the WMI subsidiary to apply to the DEP for permission to Company continues not to purchase risk transfer"non sudden and remove all waste above the height allowed by the zoning ordi- accidental"pollution liability insurance coverage,the Company's nance.The Company believes that removal of such waste is an net income could be adversely affected in the future if"non-sud- inappropriate remedy and has appealed the Superior Court order den and accidental"pollution losses should occur. to the state Supreme Court.The Company is unable to predict the The Company has issued or is a party to approximately 3,120 outcome of the appeal or the nature and extent of the removal bank letters of credit,performance bonds and other guarantees. action that may ultimately be required following further appeals Such financial instruments(averaging approximately$639,000 or as a result of the permitting process.However, if the Superior each),including those provided for affiliates and not otherwise Court order as to removal of the waste is not modified,the sub- recorded,are given in the ordinary course of business.Because .sidiary could incur substantial costs,which could vary significantly virtually no claims have been made against these financial instru- depending upon the nature of any plan which is eventually ments in the past,management does not expect these instruments approved by applicable regulatory authorities for removing the will have a material adverse effect on the consolidated financial waste,the actual volume of waste to be moved and other cur- position or results of operations of the Company, rently unforeseeable factors,and which could have a material Since 1994,WTI has been involved in litigation involving per- adverse effect on the Company's financial condition and results mits for the construction and operation of the Lisbon,Connecticut, of operations in one or more future periods. trash-to-energy plant.These matters were resolved during 1995 In the ordinary course of conducting its business,the Company and the plant began commercial operations in January 1996, becomes involved in lawsuits,administrative proceedings and During the first quarter of 1995,Waste Management International governmental investigations,including antitrust and environmental plc('WM International")received an assessment of approximately matters. Some of these proceedings may result in fines,penalties 417 million Krona(approximately$62 million)from the Swedish or judgments being assessed against the Company which,from Tax Authority,relating to a transaction completed in 1990.WM time to time,may have an impact on earnings for a particular quar- International believes that all appropriate tax returns and disclo- ter or year.The Company does not believe that these proceedings, sures were properly filed at the time of the transaction and intends individually or in the aggregate,are material to its business or to vigorously contest the assessment. financial condition. NOTE 12 Benefit Plans The Company has a defined benefit pension plan for all eligible The following table sets forth the plan's funded status and non-union domestic employees of WMX,CWM and WMI.The the amount recognized in the Company's Consolidated Balance benefits are based on the employee's years of service and com- Sheets at December 31, 1994 and 1995 for its pension plan: pensation during the highest five consecutive years out of the last ten years of employment.The Company's funding policy is to 1994 1995 contribute annually the minimum required amount determined Actuarial present value of by its actuaries. benefit obligations: Net periodic pension expense for 1993,1994 and 1995,based Accumulated benefit obligations, on discount rates of 8.50%for all three years, included the including vested benefits following,components: of$120,881 and$152,031 at December 31, 1994 and 1995. 1993 1994 1995 respectively $(136,713) $(167,287) Service cost-benefits earned Projected benefit obligation $(156,609) $(191,059) during the year $10.785 $11,075 $11,752 Plan assets at fair value, Interest cost on projected primarily common stocks, benefit obligation 9,507 11,532 13,228 bonds and real estate 136,740 167,068 Expected return on plan assets (11,055) (12,335) (13,237) - --Net amortization and deferral (1,451) (1,310) 33 Plan assets less than Net periodic pension expense $ 7,786 $ 8,962 $11,776 projected benefit obligation S (19,869) $ (23,991) Unrecognized net loss 39,304 29,801 Assumptions,used to determine the plan's funded status as Unrecognized overfunding at of December 31,are as follows: date of adoption(January 1,1985) of FAS No.87,net of amortization, 1994 1995 being recognized over 15 years (8,727) (6,422) - Discount ram 8.5% 7.75% Pension cost included in Rate of increase in compensation levels 4.0% 4.0% prepaid(accrued)expenses $ 10,708 $ (612) Expected long-term rate of return on assets 9.0% 9.0% - 19 The Company also has a non-qualified defined benefit plan The expense for postretirement health care benefits was for officers of WMX,CWM and WMI who have served in such $7,300,000 in 1993, $4,668,000 in 1994 and$5,359,000 in 1995. capacities for at least 10 years at the time of retirement The bene- The service and interest components of the expense were fits are based on the officer's years of service and compensation $3,000,000 and$4,300,000,respectively,in 1993, $1,049,000 and during the highest three consecutive years out of the last ten years $3,619,000,respectively,in 1994,and$1,094,000 and$4,265,000, of employment.The benefits are reduced by such officer's bene- respectively,in 1995. fits under the pension plan.This plan is not funded. Expense for The Company has an Employee Stock Ownership Plan("1988 1993,1994 and 1995 for this plan was$2,551,000, $3,418,000 and ESOP")for all eligible non-union United States and Canadian $4,202,000,respectively. employees of WMX, CWM and WMI.The benefits are based on WM International participates in both defined benefit and the employee's years of service and compensation.The Company defined contribution retirement plans for its employees in various contributes each year an amount,if any,determined by the Board countries.The projected benefit obligation and the plan assets of of Directors of the Company. the WM International defined benefit plans are not material.Other Information concerning the 1988 ESOP is as follows: subsidiaries participate in various multi-employer pension plans covering certain employees not covered under the Company's 1993 1994 1995 pension plan,pursuant to agreements with collective bargaining Expense recorded(contribution) $T�329 $ 930 $6,667 units who are members of such plans.These plans are generally Interest expense on 1988 ESOP debt $1,510 $1,965 $ 147 defined benefit plans;however,in many cases,specific benefit Dividends on unallocated levels are not negotiated with or known by the employer-contrib- 1988 ESOP shares used utors.Contributions of$15,242,000,$16,194,000 and$18,369,000 by the 1988 ESOP $ 964 $ 780 S 555 for subsidiaries'defined contribution plans were made and charged to income in 1993, 1994 and 1995,respectively. The Company has a Profit Sharing and Savings Plan("PSSP") The following table analyzes the obligation for postretirement available to certain employees of WMX,CWM and WMI.The benefits other than pensions(primarily health care costs),which terms of the PSSP allow for annual contributions by the Company is included in other deferred items on the Consolidated Balance as determined by the Board of Directors as well as a match of Sheets,as of December 31, 1994 and 1995: employee contributions up to$500 per employee($750 effective 1994 1995 January 1, 1996).Charges to operations for the PSSP were $11,589,000 in 1993,$27,334,000 in 1994 and$24,882,000 in 1995. Accumulated Postretirement Rust,WTI and WM International also sponsor non-contributory Benefit Obligations: and contributory defined contribution plans covering both Retirees $57,216 $52,255 salaried and hourly employees.Employer contributions are gener- Other fully eligible participants 10,960 9,682 ally based upon fixed amounts of eligible compensation and Other active participants 9,478 10,695 amounted to$18,614,000,$23,431,000 and$23,017,000 during $77,654 $72,632 1993, 1994 and 1995,respectively. Unrecognized: Effective January 1,1994,the Company and its principal Prior service cost 627 566 subsidiaries adopted FAS No.112,"Employers'Accounting for Gain 9,501 7,911 Postemployment Benefits."This new statement established accounting standards for employers who provide benefits to $87,782 581,109 former or inactive employees after employment but before For measurement purposes,an 8.5%annual rate of increase retirement.The adoption of FAS 112 did not have a significant in the per capita cost of covered health care claims was assumed effect on earnings,because the Company's accounting prior to for 1996;the rate was assumed to decrease by 0.5%per year to adoption was substantially in compliance with the new standard. 6.0%in 2001 and remain at that level thereafter.Increasing the During 1994,the Company established an Employee Stock assumed health care cost trend by one percentage point in each Benefit Trust and sold 12.6 million shares of treasury stock to year would increase the accumulated postrethement benefit the Trust in return for a 30-year,7.33%note with interest payable obligation as of December 31, 1995 by approximately$4,341,000, quarterly and principal due at maturity.The Company has agreed and the aggregate of the service and interest cost components to contribute to the Trust each quarter funds sufficient,when of net postretirement health care cost for 1995 by approximately added to dividends on the shares held by the Trust,to pay interest $403,000.The weighted-average discount rate used in determin- on the note as well as principal outstanding at maturity.At the ing the accumulated postretirement benefit obligation was 8.5% direction of an administrative committee comprised of Company in 1994 and 7.75%in 1995officers,the trustee will use the shares or proceeds from the sale of shares to pay employee benefits,and to the extent of such payments by the Trust,the Company will forgive principal and interest on the note.The shares of common stock issued to the Trust are not considered to be outstanding in the computation of earnings per share until the shares are utilized to fund obligations for which the trust was established. 4U NOTE 13 Company's Operations in Different Industries • and Geographical Areas The analysis of operations by industry segment which follows quality control,primarily in North America.Rust has served the reflects the Company's traditional management stricture of five environmental and infrastructure engineering and consulting,and principal subsidiaries,each of which has operated in a relatively on-site industrial and related services markets in the United States discrete portion of the environmental services industry or geo- and a number of foreign countries. graphic area.WMI has provided integrated solid waste services Whereas solid waste, hazardous waste and trash-to-energy oper- and CWM has provided hazardous waste collection,transpona- ations have been performed by three distinct organizations in North tion,treatment and disposal services in North America.WM America,these services have been provided internationally by a International has provided these services,as well as trash-to- single management organization. Because of the different business energy services,outside North America.WTI has been involved environment for international operations,the Company has uran- in trash-to-energy and independent power projects,water and aged these as a discrete segment.Following is an analysis of the wastewater treatment(including biosolids management)and air Companys continuing operations by these historical segments. Trash To-Energy, International Engineering Water Treatment. Waste Corporate Solid hazardous Indusuial and Air Quality and Management and Waste Waste Related Services Related Services serviva Eliminations^' Consolidated 1993 Revenue $4,702,166 $ 661,860 $1,035,004 $1,142,219 $1,411,211 $(316,344) $ 8,636,116 Operating;expenses including goodwill amortization 3,193,183 506,264 808,694 792,719 1,009,145 (309,914) 6,000,o91 Special charge - 550,000 - - - - 550,000 .Selling and administrative expenses 547,413 128,058 131,575 107,276 198,969 (9,267) 1,104,024 Income from operations S 961,570 $ (522,462) $ 94,735 5 242,224 $ 203,097 $ 2,837 $ 982,001 Identifiable assets $6.912,271 $1,498,631 $1,360,703 $3,081,709 $3,315,621 $(169,169) $15.999,766_ Depreciation and amortization expense $ 461,963 $ 63,971 $ 413,971 $ 75,323 $ 121,050 $ 22,084 $ 788,362 Capital expenditures'' $1,139,004 $ 157,786 S 124,754 $ 303,905 S 403,326 S 26,009 $ 2,154,784 1994 Revenue $5,117,871 $ 649,581 $1,140,294 $1,324,567 $1,710,862 $(388,470) $ 9,554,705 Operating expenses including goodwill amortization 3,502,445 454,765 915,129 915,237 1,244,597 (380393) 6,651,780 Selling and administrative expenses 549,608 105,736 153,230 119,380 230,014 1,532 1,159,500 Income from operations $105,818 $ 89,080 $ 71,935 $ 289,950 $ 236,251 $ (9,609) $ 1,743,425 Identifiable assets $7,388,766 $1.375,341 $1,472,263 53,276,611 $4,037,922 $_(311,381) $17,239,522 Depreciation and amortization expense $ 479,333 $ 59,381 $ 57,542 $ 95,254 S 154,575 $ 24,514 $ 870,599 Capital expenditures", $ 950,383 $ 57,983 S 57,242 $ 115,082 S 304,999 S 20,397 $ 1,506,086 1995 Revenue $5,642,857 $ 613,883 $1,027,430 $1,451,675 $1,865,081 $(353,309) $10,247,617 Operating expenses including goodwill amortization 3,806,798 463,984 816,528 1,015,269 1,410,282 (350,309) 7,162,552 Special charges - 140600 194,593 335,193 Selling and administrative expenses 578,290 94,551 135,012 130,976 235,807 - 1,174,636 Income from operations $1,257,769 $ (85,252) $ 75,890 $ 305,430 $ 24,399 $ (3,000) $ 1,575,236 Identifiable assets $8,506954 $1.159,467 $1,387,565 $3,220,193 $4,235,589 $ 54,988 $18,564,75(1 Depreciation and amortization expense $ 457,820 $ 48,860 $ 49,796 $ 107.814 $ 181,341 S_ 32,041 $ 877,672 Capital expenditures' 51,101,312 $ 65,080 $ 34,606 $ 45,101 $ 263,352 $ 31,624 $_ 1,541,075 (1)Includes.corporate office and elimination of intercompany transactions. (2)Includes property and equipment of purchased businesses. 4t As a result of a strategic review begun in 1994,management energy,clean water,and environmental and infrastructure engi- and operations of the Company have been realigned on the basis neering and consulting.The following table analyzes continuing of four principal global lines of business-waste services,clean operations on a line-of-business basis. Environmental and Infrastructure Waste Clean Clean Engineering and Corporate and Services Energy Water Consulting Eliminations"' Consolidated 1993 Revenue S 7,457,371 $ 804,016 $392,194 $298,879 $(316,344) $ 8,636,116 Operating expenses including goodwill amortization 5,259,571 532,619 294,525 223,290 (309,914) 6,000,091 Special charge 550,000 - 550,000 Selling and administrative expenses 956,588 46,899 63,937 45,867 (9,267) 1,104,024 Income from operations $ 691,212 $ 224,498 $ 33,732 $ 29,722 $ 2,837 $ 982,001 Identifiable assets $12,356,320 $2,196,145 $485,349 $297,258 $664,694 $15,999,766 Depreciation and amortization expense $ 693,819 $ 62,777 $ 21,446 $ 10,320 $ - $ 788,362 Capital expenditures", $ 1,802,781 $ 209,091 $112,965 $ 26,718 $ 3,229 $ 2,154,784 1994 Revenue $ 8,140,785 $ 888,037 5489,295 $425,058 $(388,470) $ 9,554,705 Operating expenses including goodwill amortization 5,738,990 589,610 369,592 333,981 (380,393) 6,651,780 Selling and administrative expenses 971,075 44,032 78,615 64,246 1,532 1,152500 Income from operations $ 1,430,720 $ 254,395 $ 41,088 $ 26,831 $ (9,609) $ 1,743,425 Identifiable assets $13,470,901 $2,152,458 $587,480 $402,053 $626,630 $17,239,522 --.. Depreciation and amortization expense $ 751,251 $ 62,460 $ 40,813 $ 16,075 $ - $ 870,599 Capital expenditures", S 1,374,893 $ 76,392 $ 35,725 $ 14,576 $ 4,500 $ 1,506,086 1995 Revenue $ 8,634,836 $ 893,513 $618,472 $454,105 $(353,309) $10,247,617 Operating expenses including goodwill amortization 6,099,597 574,865 477,842 360,557 (350,309) 7,162,552 Special charges 325,336 9,857 - - - 335,193 Selling and administrative expenses 972,018 44,751 89,922 67,945 - 1,174,636 Income from operations $ 1,237,885 $ 264,040 $ 50,708 $ 25,603 $ (3,000) $ 1,575,236 Identifiable assets $14,535,905 $2,025,491 $612,824 $392,486 $998,050 $18,564,756 Depreciation and amortization expense $ 742,148 $ 73,098 $ 44,744 $ 17,682 $ - $ 877,672 Capital expenditures", $ 1,485,958 $ 12,404 $ 33,415 $ 9,288 $ 10 $ 1,541,075 (1)Includes property and equipment of purchased businesses. (2)Includes corporate office and elimination of intersegment transactions. 42 Foreign operations in 1995 were conducted in 10 countries in Brazil,Mexico,Israel,and Argentina.The information relating to the • Europe,eight countries in the Asia Pacific region,and Canada, Company's foreign operations is set forth in the following tables: United Other States Europe Foreign Consolidated 1993 Revenue $ 6,994,757 $1,241,811 $399,548 $ 8,636,116 Income from operations $ 754,502 $ 184,412 $ 43,087 $ 982,001 Identifiable assets $12,444,968 $2,955,078 $599,720 $15,999,766 1994 Revenue $ 7,427,611 $1,504,154 $622,940 $ 9,554,705 Income from operations $ 1,476,067 $ 198,251 $ 69,107 $ 1,743,425 Identifiable assets $12,628,264 $3,725,393 $885,865 $17,239,522 1995 Revenue $ 7,837,050 $1,800,768 $609,799 $10,247,617 Income from operations $ 1,515,729 $ 17,951 $ 41,556 $ 1,575,236 Identifiable assets $13,769,141 $3,920,962 $874,653 $18,564,756 No single customer accounted for as much as 3%of consoli- WM International is unable to predict what impact,if any,this dated revenue in 1993, 1994 and 1995. change will have on its operations in Hong Kong.At December 31, WM International operates facilities in Hong Kong which are 1995,WM International had identifiable assets of$242.5 million owned by the Hong Kong government On July 1,1997,control related to its Hong Kong operations,which generated 1995 pretax of the Hoang Kong government transfers to mainland China. income of approximately$16.5 million. • NOTE 14 Special Gains and Charges During the third quarter of 1993,the Company recorded a special related primarily to a write-off of the investment in facilities and charge of$550.0 million(before tax and minority interest)as a technologies that CWM abandoned because they do not meet result of CWM recording a special asset revaluation and restructur- customer service or performance objectives,but also includes ing charge.The charge consisted of$381.0 million to write down $22.0 million of future cash payments for rents under non-can- assets,primarily incinerators,and$169.0 million for cash expendi- cellable leases,guaranteed bank obligations of a joint venture, tures.Substantially all of the cash expenditures were made as of and employee severance.The majority of the cash expenditures December 31, 1994.As a result of this program, overhead, includ- were paid in 1995,although certain of the non-cancellable leases ing depreciation and amortization,was reduced in 1994 by extend through the year 2002. approximately$60 million on an annualized basis. In the fourth quarter of 1995,WM International recorded an Results I-or 1993 include a non-taxable gain of$15.1 million exceptional charge of$194.6 million($152.4 million after tax) (before minority interest)relating to the second quarter issuance primarily related to the actions it is taking to sell or otherwise of shares by Rust in connection with the acquisition of the minor- dispose of non-core businesses and investments, as well as core iry interest in a subsidiary. businesses and investments in low potential markets,abandon In 1994,Rust recorded a charge of$9.2 million(before tax and certain hazardous waste treatment and processing technologies, minority interest)for the writeoff of assets and the recognition of and streamline its country management organization.The charge one-time costs incurred during the fourth quarter in connection reduced the Company's income by approximately$153.3 million with the discontinuance of its marine construction and dredging before tax($111.0 million after tax).The charge included operations,and the closing of offices in a consolidation of its $34.3 million of cash payments for employee severance and rents other operations.This charge is included in Operating Expenses under non-cancellable leases.Approximately$11.2 million of the ($6.6 million)and Selling and Administrative Expenses($2.6 mil- cash costs were paid prior to December 31,1995.The majority of lion)in the Consolidated Statement of Income. the balance will be paid in early 1996,although certain rent In the first quarter of 1995,in response to the continuing payments on leased facilities will continue into the future.WM deterioration of the chemical waste services market,CWM took International expects that upon completion of these actions, additional steps to realign its organization,and in connection overhead will be reduced by approximately$20 million annually, therewith,recorded a special charge of$140.6 million before which management plans to invest in new marketing initiatives tax($91.4 million after tax or$.19 per WMX share).The charge and operational productivity enhancements. 43 Note t6 Discontinued Operations In December 1995,the Rust Board of Directors approved a plan sale of businesses and assets.The amounts Rust will ultimately real- to sell or otherwise discontinue Rust's process engineering,con- ize could differ materially in the near tern from these estimates. struction,specialty contracting and similar lines of business and Revenues of the discontinued businesses were$499,461,000 in have Rust focus on its environmental and infrastructure engineer- 1993, $542,613,000 in 1994,and$731,731,000 in 1995. Following ing and consulting businesses.The discontinued businesses have is a summary of the assets and liabilities as of December 31,1994 been segregated and the accompanying consolidated balance and 1995,which are reflected on the consolidated balance sheets sheets,statements of income and related footnote information as net assets of discontinued operations: have been restated. Rust has engaged investment bankers to assist it in valuing and _ 1994 1995 identifying potential buyers for the major business units to be sold, Current assets $ 136,466 $ 16062 and expects to complete the sales in 1996.Provision has been made Property and equipment for estimated loss on disposal of the discontinued operations,net of and other noncurrent assets 162,926 94,251 related tax benefits and minority interest,and is included in the 1995 Current liabilities (111,718) (122,529) consolidated statement of income.The provision for loss includes Noncurrent liabilities (4,023) (4,832) management's best estimate of the amounts to be realized on the Net assets of discontinued operations $ 183,651 $ 130,552 NOTE 16 Fair Value of Financial Instruments The following disclosure of the estimated fair value of financial Company or holders of the instruments could realize in a current instruments is made in accordance with the requirements of FAS market exchange.The use of different assumptions and/or estima- No. 107, `Disclosures about Fair Value of Financial Instruments." tion methodologies may have a material effect on the estimated fair The estimated fair value amounts have been determined by the value amounts.The fair value estimates presented herein are based Company,using available market information and commonly on information available to management as of December 31,1994, accepted valuation methodologies.However,considerable judg- and December 31, 1995.Such amounts have not been revalued ment is necessarily required in interpreting market data to develop since those dates,and current estimates of fair value may differ the estimates of fair value.Accordingly,the estimates presented significantly from the amounts presented herein. herein are not necessarily indicative of the amounts that the December 31,1994 December 31,1995 Carrying Estimated Carrying Estimated Amount Fair Value Amount Fair Value Nonderivatives— Assets— Cash and cash equivalents $ 123,348 $ 123,348 $ 189,031 $ 189,031 Receivables 1,887,923 1,887,923 1,889,721 1,889,721 Short-term investments 19,704 19,704 36,243 36,243 Liabilities— Commercial paper 946,702 944,837 1,119,356 1,120,209 Project debt 764,859 828,320 735,646 880,619 Liquid Yield Option Notes and WMX Subordinated Notes 505,140 500,410 539,352 576,024 Other borrowings 4,718,396 4,586,522 5,120,421 5,319,414 Derivatives relating to debt — 1,653 (74) Other derivatives carried as Assets(in Other Assets) 307 307 Liabilities(in Accmed Expenses) (1,105) (16,245) (65) (16,647) Letters of credit,performance bonds and guarantees — — — 44 Cash,Receivables and Short-Term Investments The carrying shown as assets and liabilities,as offsetting.such amounts against amounts of these items are a reasonable estimate of their fair value. the related nonderivative instrument is permitted only pursuant to Liabilities For debt issues that are publicly traded,fair values are a right of setoff or master netting agreement. based on quoted market prices or dealer quotes.Due to the short- Off-Balance Sbeet FinaneialImtrumems In the normal course term nature of the ESOP notes,their carrying value approximates of business,the Company is a parry to financial instruments with fair value.Interest rates that are currently available to the Company off-balance-sheet risk,such as bank letters of credit,performance for issuance of debt with similar terms and remaining maturities bonds and other guarantees,which are not reflected in the accom- are used to estimate fair value for debt issues that are not quoted panying balance sheets.Such financial instruments are to be valued on an exchange. based on the amount of exposure under the instrument and the Derivatives The fair value of derivatives generally reflects the likelihood of performance being required.In the Company's expe- rience,virtually no claims have been made against these financial estimated amounts that the Company would receive or pay to ter- instruments.Management does not expect any material losses to urinate the contracts at December 31,thereby taking into account result from these off-balance-sheet instruments and,therefore,is unrealized gains and losses.Dealer quotes are available for most of the opinion that the fair value of these instruments is zero. of the Company's derivatives.Deferred gains and losses are NOTE 17 Selected Quarterly Financial Data(Unaudited) The following is an analysis of certain items in the Consolidated Statements of Income by quarter for 1994 and 1995. First Second Third Fourth Quarter Quarter Quarter Quarter Year 1994 Revenue $2,170,661 $2,420,106 $2,459,336 $2,504,602 S 9,554,705 Gross profit 649,818 747,041 749,669 756,397 2,902,925 Income from continuing operations 161,777 202,155 207,093 205,466 776,491 Net income 162,612 203,117 212,885 205,767 784,381 Income from continuing operations per common and common equivalent share 33 .42 .43 .42 1.60 Net income per common and common equivalent share .34 .42 .44 .42 1.62 1995 Revenue $2,445,185 $2,635,665 $2,619,227 $2,547,540 $10,247,617 Gross profit 591,125 788,929 794,941 574,877 2749,872 Income from continuing operations 101,292 212,462 230,801 110,035 654,590 Net income 101,245 219,127 233,848 49,679 603,899 Income from continuing operations per common and common equivalent share .21 .44 .47 .23 1.35 Net income per common and common equivalent share .21 .45 .48 .10 1.24 See Note 14 to Consolidated Financial Statements for a discus- See Note 15 to Consolidated Financial Statements for a discus- sion of the special charges affecting the 1994 fourth quarter and Sion of the decision to discontinue certain operations,announced full year results and the 1995 first quarter,fourth quarter and full during the fourth quarter of 1995. year results. • 45 WMX Technologies, Inc. Environmental Policy WMX Technologies,Inc.is committed to protecting and enhanc- Risk Reduction ing the environment,and to updating its practices in light of 7.The Company will operate in a manner designed to minimize ^ advances in technology and new understandings in health and environmental,health or safety hazards.We will minimize risk and environmental science. protect our employees and others in the vicinity of our operations Prevention of pollution and enhancement of the environment by employing safe technologies and operating procedures and by are the fundamental premises of the Company's business.We being prepared for emergencies.The Company will make avail- believe that all corporations have a responsibility to conduct their able to our employees and to the public information related to business as responsible stewards of the environment and to seek any of our operations that we believe cause environmental harm profits only through activities that leave the Earth healthy and safe. or pose health or safety hazards.The Company will encourage We believe that the Company has a responsibility not to compro- employees to report any condition that creates a danger to the mise the ability of future generations to sustain their needs. environment or poses health or safety hazards,and will provide The principles of this policy are applicable to the Company confidential means for them to do so. throughout the world.The Company will take demonstrable actions on a continuing basis in furtherance of the principles. Damage Compensation 8.The Company will take responsibility for any harm we cause to Environmental Protection and Enhancement the environment and will make every reasonable effort to remedy 1.The Company is committed to improving the environment the damage caused to people or ecosystems. through the services that we offer and to providing our services in a manner demonstrably protective of human health and the Research and Development environment,even If not required by law.We will minimize and 9.The Company will research,develop and implement strive not to allow any releases to the atmosphere,land,or water technologies for integrated waste management. in amounts that may harm human health and the environment. We will train employees to enhance understanding of environ- Public Policy and Public Education mental policies and to promote excellence in job performance 10.The Company will provide information to and will assist on all environmental matters. the public in understanding the environmental impacts of our activities.We will conduct public tours of facilities,consistent Waste Reduction,Recycling,Treatment and Disposal with safety requirements,and will work with communities near 2.The Company will work to minimize the volume and toxicity our facilities to encourage dialogue and exchange of information of waste generated by us and others.We will operate internal on facility activities. recycling programs.We will vigorously pursue opportunities to recycle waste before other management practices are applied. 11.The Company will support and participate in development of The Company will use and provide environmentally safe treat- public policy and in educational initiatives that will protect human ment and disposal services for waste that is not eliminated at health and improve the environment.We will seek cooperation the source or recycled. on this work with government,environmental groups,schools, universities,and other public organizations. Biodiversity 3 The Company is committed to the conservation of nature. Participation in Environmental Organisations We will implement a policy of"no net loss"of wetlands or other 12.The Company will encourage its employees to participate biological diversity on the Company's property. in and to support the work of environmental organizations,and we will provide support to environmental organizations for the Sustainable Use of Natural Resources advancement of environmental protection. 4.The Company will use renewable natural resources,such as water,soils and forests,in a sustainable manner and will offer Environmental Policy Assessment services to make degraded resources once again usable.We will 13.The Board of Directors of the Company will evaluate and conserve nonrenewable natural resources through efficient use will address the environmental implications of its decisions.The and careful planning. Executive Environmental Committee of the Company will report directly to the Chief Executive Officer of the Company and will Wise Use of Energy monitor and report upon implementation of this policy and other 5.The Company will make every reasonable effort to use environmental matters.The Company will commit the resources environmentally safe and sustainable energy sources to meet our needed to implement these principles. needs.We will seek opportunities to improve energy efficiency and conservation in our operations. Annual Environmental Report 14.The Company will prepare and make public an annual Compliance report on its environmental activities.The report will include a 6.The Company is committed to comply with all legal require- self-evaluation of the Company's implementation of these princi- ments and to implement programsandprocedures to ensure ples,including an assessment of the Company's performance in compliance.These efforts will include training and testing of complying with all applicable environmental laws and regulations employees,rewarding employees who excel in compliance, throughout its worldwide operations. and disciplining employees who violate legal requirements. 46 WMX Technologies, Inc. Directors and Officers WMX Technologies • Board of Directors Dean L.Buntrock Dr.Pastora San Juan Cafferty- Dr.James B.Edwards Peer Pedersen Chairman of the Board& Professor,University of Chicago President,Medical University Managing Partner, Chief Executive Officer The School of Social Service of South Carolina Pedersen&Haupt,P.C. Phillip B.Rooney Administration Donald F.Flynn (Chicago law firm) President&Chief Operating Officer Jerry E.Dempsey Chairman of the Board&President, James R.Peterson If.Jesse Arnelle Chairman&Chief Executive Officer Flynn Enterprises,Inc.(financial Former President,Chief Executive Senior Partner,Arnelle,Hastie, PPG Industries,Inc.(glass,coatings advisory and venture capital firm) Officer&Director,The Parker McGee,Willis&Greene and chemicals company) Peter H.Huizenga Pen Co.(manufacturer and (California-based law firm) Howard H.Baker,Jr. President,Huizenga Capital distributor of writing instruments) Partner,Baker,Donelson, Management(financial Alexander B.Trowbridge Bearman&Caldwell management services) President,Trowbridge Partners,Inc. (Tennessee-based law firm) (consulting services); Former President,National Association of Manufacturers WMX Technologies Management Committee Dean L.Buntrock' Donald R.Chappel John J.Goody Thomas C.Leonhardt Chairman o:the Board and Vice President&Controller Chief Executive Officer President&Chief Executive Officer Chief Executive Officer Waste Management,Inc. Wheelabrator Water Technologies Rust Consulting Phillip B.Rooney' Michael J.Cole Joseph M.Holsten' James E.O'Connor President&Chief Operating Officer President,Waste Management- Chief Executive President Ronald S.Baker Technology Services Waste Management International plc Waste Management-Florida President Luther Michael Collier William P.Halligan' D.P.Payne' Waste Management-Mideast Executive Vice President Executive Vice President Senior Vice President- James J.Barry Waste Management,Inc. Waste Management,Inc. Human Resources&Communications President Robert P.Damico Harold L. orski J James M.Rooney Waste Management-Midwest President President President Jerry W.Caudle Waste Management-Mountain Waste Management-Southeast Waste Management-Atlantic President Edwin G.Falkman John M.Kehoe,Jr. James D.Teter Waste Management-Southwest Chairman President&Chief Operating Officer President Waste Management international plc Wheelabrator Technologies Inc. Waste Management-West Herbert A.Getz' James E.Koenig' 'Member of the Executive Committee Senior Vice President, Senior Vice President, General Counsel&Secretary Chief Financial Officer&Treasurer WMX Technologies Officers Dean L.Bur Crock' Thomas C.Hau' Frank B.Moore Donald A.Wallgred Chairman of the Board& Vice President&Controller Vice President-Government Affairs Vice President, Chief Executive Officer Dr.Deborah C.Hackman Susan C.Nostra Chief Environmental Officer Phillip B.Rooney' Vice President-Technology Vice President-Treasury Thomas A.Witt President&Chief Operating Officer Development and Management William J.Plunkett Vice President& Herbert A.Getz' H.Vaughn Hooks Vice President-Communications Associate General Counsel Senior Vice President, Vice President-Tax John D.Sanford 'Executive Officer General Counsel&Secretary Ronald M.Jericho Vice President-Project Finance James E.Koenig' Vice President-Repotting Bruce D.Tobeeksen Senior Vice President, Chief Financial Officer&Treasurer Vice President-Finance D.P.Payne' Senior Vice President-Human Resources&Communications • 47 WMX Technologies, Inc. Corporate Information Common Stock Listings The Company's common stock is traded on the New York Stock The common stock is also listed for trading on the Chicago, Exchange under the symbol WMX. Frankfurt and London Stock Exchanges,and the Swiss Stock Exchanges in Geneva,Zurich and Basle. Common Stock Activity The table below sets forth by quarter,for the last two years,the high York Stock Exchange Composite Tape and the volume of shares and low sales prices of the Company's common stock on the New traded as reported by The Wall Street Journal(Midwest edition). 1994 volume 1995 volume First Quarter 104,953,700 First Quarter 89,716,300 Second Quarter 73,765,500 Second Quarter 71,824,200 Third Quarter 72,951,000 Third Quarter 76,302,300 Fourth Quarter 71,904,800 Fourth Quarter 81,227,200 High Low High Low First Quarter 303/4 23 First Quarter 295/8 253/4 Second Quarter 293/8 221/8 Second Quarter 283/4 263/ Third Quarter 303/8 261/8 Third Quarter 32�k 28'/4 Fourth Quarter 30 241/2 Fourth Quarter 30-/8 261/8 At March 1, 1996,the Company had approximately 55,000 stockholders of record. Additional Information You may obtain,at no cost,copies of WMX Technologies' In addition,any stockholder may be placed on the Company's 1995 Form 10-K report,annual environmental report and mailing list to receive quarterly reports by contacting the quarterly reports by writing to: Company at(708)572-8878.For information regarding other WMX Technologies,Inc. matters concerning your stockholdings in the Company,you 3003 Butterfield Road may contact the Company toll-free at(800)WMX-1190. Oak Brook,Illinois 60521 Attention:Corporate and Public Affairs Department Corporate Responsibility and Community Investment WMX Technologies,Inc.is committed to serve the communities in better places in which to live by our people's participation in the which it operates.The Company supports and encourages this Company's educational,environmental,health and medical,and commitment through grants and resources that match not only the community enhancement programs. financial contributions of its people,but their volunteer service time as well.WMX has made communities all over the world Transfer Agent and Registrar Harris Trust and Savings Bank 311 West Monroe Street Chicago,Illinois 60606 Dividend Reinvestment and Stock Purchase Plan The WMX Technologies Dividend Reinvestment and Stock For further information,call or write to: Purchase Plan provides owners of the Company's stock a Harris Trust and Savings Bank convenient way to increase their holdings through automatic Dividend Reinvestment Service reinvestment of cash dividends,voluntary contributions of P.O. Box A3309 between$25 and$2,000 per month,or a combination of the two. Chicago,Illinois 60690 WMX stockholders may enroll in the plan at any time. (312)293-8615 Consolidation of Multiple Accounts To avoid receiving duplicate mailings,stockholders with more Harris Trust and Savings Bank,Shareholder Services Division, than one WMX Technologies registered account may wish to 311 West Monroe Street,Chicago,Illinois 60606, consolidate their stockholdings. For more information,contact Telephone(312)293-8615. Annual Meeting The Annual Meeting of Stockholders will be conducted at 100 Drury Lane(Illinois Highway 83 and Roosevelt Road), 2:00 p.m.Friday,May 10,1996 at the Drury Lane Theatre, Oakbrook Terrace,Illinois. This book is printed on recycled paper and is recyclable. 48 • TNrOR^1ATTON SCwEDULE r Town of 5outhcld Bid Project C&D Haul - Disposal Services 'The Bidder herein certifies that it is qualified to perform the work covered by this proposal , and that it is not acting as a broker, on the behalf of others . To substantiate these qualiFications , the Bidder offers the following -elated information and references in order that the Town may evaluate the Bidder ' s qualificaticrs and experience . WM of NY, Inc. DBA '_ . __rider 's Legal Name: Waste Management of New York Bu51ness Address : 123 Varick AvPnup _ • .,trees Brooklyn NY 11237 _w State Zio 3 . __-te incoroorated: Delaware Year moor'.0 . 1996 0928527 New York State; Business License No . : _ 097.8528 5 . No . years in cont=acting business under above name: �1 rs . S . Has Firm ever defaulted on a contract? Yes No X 7 . Gross Value - work under current contract: S 20 Million 8 . Number of Current Contracts : 18 B-_e description general work performed by Firm: Collection, Processing, Recycling, and Disposal of various Waste Streams including Municipal Soild Waste, C&D Waste, Sludge, and Incinerator ash. Ouali=_caciens Summary Schedule 5 .0 .= 510 CPRCPOSAL7 ?CRM Page ' of 4 • INFORMATION SCHEDULE r - (Continued) 10 . Has Firm ever `ailed to complete work awarded? Yes.... No X IF yes , attach support statement as to circumstances . 11 . Related Experience Reference (within previous S years) 11 . 1 Project Title: SEE ATTACHED EXPERTENCE Owner 's Name: Address: Engineer: Address: Project Initial Start Date: Project Acceptance Cate: initial Bic Value: 5 • final Complete Project Value: S Brief Project Oescr_ption: 11 . 2 Project Title: SEE ATTACHED EXPERIENCE Owner 's Name: Address: Engineer: Address: Prosect initial Start Date: Project Acceptance Date: • Qualifications Summ,r,a scheduie 5 .03 BID CPRCPCSAL) FORM Page 2 of `i • I NVORNAT I ON SCI:EDULE F - (Con s I ni t5d) Initial Bid Value: 5 Final Complete Project Value : 5 Brief Project Description: 11 .3 Project Title: SEE ATTACHED EXPERIENCE Owner 's Name: Address: Engineer: Address: Prosect Ini:.ial Star- Date: • Project Acceptance Date : Initial Sid Value: 5 Final Complete Project Value: 5 Brief Project Oescrlption• • CualiFlca-'_ons Summary Scned.:le S .C .= 3I0 (PROPOSAL) FORM Prage ? of u • i NFORMAr i ON SCHEDULE - - C ont_^ue'' , 12 . Principal -_rm Member=_ ' Background'-Experience (_ members minimum) . Attach current resumes as Schedule 5 .0 . 7 supplement or give concise description bg individual . WM of New York Inc. DBA Name of idaer : wantp Manayomont of ireu York By : Date. 5-22-97 (Authorizet Signature% Charles Gusmano • NOTE: _nu supp_smenta_ attachments or mcdirizaticns -c -his shall be labelee Schecule - r. F . and sna'_ 7 be prooeriy integrated into this Bid Form . .F blank not app_icable, Fill in with N/A • Qua- _Ficatiors Summand Sc_ledul� '- - • F BID 'FROPCEAL) 'ORM Page L� cF _ • SCHEDULE F ATTACHMENT Town of Oyster Bay TERM: 3-1-94 to present AMOUNT: $9.4 million per year CONTACT: Eric Swenson(516) 921-5811 Hauling and disposal of approximately 600 tons per dayt of municipal solid waste for the Town of Oyster Bay. Number of Employees: 60-70 Equipment utilized for this project: 2 payloaders 1 IT-12 3 yard tractors 1 excavator/grappler 1 sweeper 30-40 tractor/trailers • 10-15 staged trucks New York City Department of Sanitation TERM: 3-4-94 to 3-2-99 AMOUNT: $2.8 million per year CONTACT: Barbara Berg - (212) 837-8011 For the acceptance and processing of up to 300 tons per day of commingled metal, glass and plastic Number of Employees: 50-60 Equipment utilized on this project: numerous recycling/processing equipment 3 payloaders 2 yard tractors 6 tractor trailers 2 forklifts 1 excavator/grappler • Greenwich, CT TERM: 12/96 to 12/96 AMOUNT: $300,000 per year CONTACT: Pat Nichols (203) 622-7740 Hauling, disposal and recycling of 5,000 tons per year of bulky waste and construction/demolition debris Number of Employees: 3-6 Equipment utilized on this project: 2-4 tractor/trailers City of Stamford TERM: 1/1/95 to 1/1/98 AMOUNT: $1.1 million per year • CONTACT: Jeannette Semon(203) 977-4590 Hauling and disposal of approximately 10,000 tons per year of municipal sludge for the City of Stamford. New award was just granted 1/1/97. Number of Employees: 4-7 Equipment utilized for this project: 3-6 tractor/trailers • New York City Department of Environmental Protection TERM: 1/1/94 to 12/31/95 AMOUNT: $1.7 million per year CONTACT: Tom Bensten (212) 860-9359 Transportation and disposal of grit and screenings and supply dewatering containers Number of Employees: 50-60 Equipment utilized for this project: 100+ dewatering containers 40 tractor trailers 7 rolloffs 2 payloaders Town of Islip TERM: 1/1/92 to 12/31/94 • AMOUNT: $33.8 million per year CONTACT: Charles Weidner (516) 224-5643 Contract to supply hauling and disposal services for ash and bypass waste. Volumes are estimated at 40,000 tons per year. Number of Employees: 100-110 Equipment utilized for this project: numerous recycling/processing equipment 3 payloaders 2 yard tractors 6 tractor trailers 2 forklifts 1 sweeper 1 excavator/grappler Greenwich, CT TERM: 8/93 to 9/94 AMOUNT: $2 million per year CONTACT: Pat Nichols (203) 622-7740 Hauling and disposal services for approximately 4,200 tons per year of sewage sludge from the Town of Greenwich, CT Number of Employees: 4-7 Equipment utilized for this project: 3-6 tractor trailers Brookhaven TERM: 1/2/92 to 1/1/96 AMOUNT: $2.5 million per year CONTACT: Jim Heil (516) 541-6221 Transfer operation of 200,000 tons per year, transfer facility and hauling services for approximately 200,000 tons per year from the Town of Brookhaven to the Hempstead Resource Recovery Facility. Number of Employees: 16 Equipment utilized on this project: 1 excavator/grappler 2 payloaders 3 yard tractors 8 tractors 16 trailers New York City Department of Environmental Protection • TERM: 4/93 to 4/95 AMOUNT: $8.6 million per year CONTACT: Tom Bensten(212) 860-9359 Transportation and disposal of 200 tons per day of dewatered sewage sludge for a one year contract Number of Employees: 70-75 Equipment utilized on this project: 70 tractors/trailers New York City Department of Environmental Protection TERM: 11/94 to 11/96 AMOUNT: $10.2 million for term of contract CONTACT: Anthony Maracis (718) 595-5047 Transportation and disposal of approximately 100 tons per day of grit and screening from Wards Island Number of Employees: 20 Equipment utilized on this project: 25 tractors/trailers • • North Hempstead TERM: 1993 to 1994 AMOUNT: $375,000 per year CONTACT: Paul Roth (516) 767-4607 Contract to transfer, haul, process all of the commingled recyclables generated from the Town of which is approximately 6,000 tons per year Number of Employees: 50-60 Equipment utilized on this project: 3 payloaders 2 yard tractors 6 tractor trailers 2 forklifts 1 excavator/grappler North Hempstead TERM: 1989 to 1994 AMOUNT: $12,000,000 per year CONTACT: Paul Roth (516) 767-4607 Contract to transfer, haul, process and dispose of all municipal solid waste, • yardwaste, construction and demolition debris for the Town of North Hempstead. Tonnage generated was approximately 750 tons of waste materials per day, 200,000 tons per year. Number of Employees: 116 Equipment utilized on this project: 5 payloaders 6 yard horses 33 tractor trailers 3 IT-12's 1 sweeper Huntington TERM: 10/91 to 10/92 AMOUNT: $2.4 million per year CONTACT: Tom Chambers Transfer and hauling services for approximately 65,000 tons per year of incinerator ash from Ogden Martin Systems of Huntington. Number of Employees: 28 Equipment utilized on this project: 1 crane 2 excavators/grappler • 250 railcars 10 staged trailers 25 tractor trailers Management Team WM of New York's experienced, professional management team is a key element, perhaps the key element, in the Division's long-term strategy for growth. The WMI has assembled a dynamic mix of talented innovators, functional experts and seasoned professionals with which to manage the Division's extensive operations and pursue its goals. James Dancy, Executive Vice President for Waste Management, Inc. is responsible for the overall operations of Waste Management of New York. He also has responsibilities for other Waste Management divisions in New York,New Jersey and Pennsylvania. Mr. Dancy has more than 30 years experience in the solid waste and recycling industry. He holds a Bachelor of Science degree in Business Administration from St. Joseph's University in Philadelphia, PA. Some of the positions that Mr. Dancy has held with Waste Management include General Manager, District Manager and Regional Operations Manager. Mr. Dancy has also played a critical role in the establishment and growth of Waste Management International. James Lambros, Group Financial Vice President,has responsibilities for the financial • management of Waste Management of New York and other Waste Management divisions in the New York, New Jersey and Pennsylvania area. Mr. Lambros has been with Waste Management for ten years. He has a Bachelor of Science degree in Accounting from the University of Akron in Akron, Ohio. Mr. Lambros is a Certified Public Accountant. Prior to his recent position, he was the Manager of Accounting and Finance of Waste Management's Group Accounting Center in Morrisville, PA. Anthony Lomangino, as Division President,brings over 20 years of industry experience to WM of New York from the company founded by his family in 1954. His determination and foresight over the years have transformed a fledgling hauling and disposal operation (Allied Sanitation) into a full-service, vertically integrated solid waste management division of WMI. Mr. Lomangino is a leading proponent of alternative methodologies, and continues to be a motivator behind the Division's drive to develop innovative, particle and profitable solid waste management solutions. He as been appointed to the Solid Waste Advisory Boards of the boroughs of Manhattan and Brooklyn. He holds a B.S. in accounting (cum laude) from St. John's University. William F. Kaiser, Division Controller,has a wealth of business development/planning and finance experience with both start-up and blue-chip companies. Beginning his career in accounting and finance at Price Warehouse and then Xerox, Mr. Kaiser later established and directed the financial function at Atari's $350 million home computer division. As V.P. of Finance at Electronic Arts, he participated in the growth and development of the company from its inception in 1983 through and following its successful 1989 IPO. Immediately prior to joining WM (formerly Resource), Mr. Kaiser was CEO at Wedge Innovations, where he raised substantial venture capital for this fast- growing, privately held smart tools company. Mr. Kaiser holds a B.S. in accounting and economics, (cum laude) and a M.B.A. in finance and accounting from St. John's University, and is a Certified Public Accountant. Will Flower, Vice President of Communications and Community Relations,works with community organizations, community boards, environmental groups and the news media to foster an understanding and appreciation for the challenge of managing society's waste. Mr. Flower has 14 years experience in the area of environmental protection. Prior to joining Waste Management, he worked in the Director's Office of the Illinois Environmental Protection Agency. In 1990, Mr. Flower joined the team at Waste Management as the Senior Manager of Community Relations in the company's Midwest • group. He was named Senior Manager of Community Relations in 1994 and was selected to work in New York following the acquisition of ReSource. Mr. Flower has a Bachelor of Administration from Sangamon State University (now University of Illinois). Charles Gusmano, Director of Business Development, has over 15 years experience in all facets of Solid Waste Management. Previously to his assuming his current position, he oversaw operations at all of the Divisions, Transfer and Long-haul operations. Mr. Gusmano holds a B.S. in Business Administration from Hofstra University. William C. Miller,Jr. PE, Director, Business Development and Special Projects, Mr. Miller brings over 30 years of national and international experience in the environmental field specializing in solid waste management. Mr. Miller is responsible for continued development and growth of the Division's Municipal Business segment. Prior to joining WM, Mr. Miller was a principal in William F. Cosulich Associates, PC a national environmental consulting firm. Mr. Miller holds a BECE from New York University and is a registered Professional Engineer in multiple states. Gary Adriance, Safety Manager, is responsible for all safety and training programs throughout WM of New York. Prior to joining the team at WM, Mr. Adriance was the Safety and Environmental Manager for Interstate Brands Corp. He has more than 25 years of experience in the safety field and served in the United States Air Force for 22 years. Mr. Adriance is a graduate of the United States Air Force Academy in Colorado Springs, CO. ;NP. OR A710N SCHECUL- Q -own OF Southold Bid Project CED Haul - Disposal Services The Bidder her=_bu states that it proposes , it awarded an Agreement tc use the Following haul subcontractors on this project . Subcontractor/ Ccntract Trade/ ,ndividual Address Phone # Specialties 1 . 14�t Tgrium �A4 �4461-7704 Tnjjdm — Axrm 2 . M Dmald 9alli%m Fc �11�g W 516--475-9197 Tnxkirg 7p ---- ' - --- -MI190 Rmptin P737is 800 9939493 7ilxiang -- S . 10 . Name of of Bidder : Ms?e AanL$gfienMof New York Bu (� , `� e� 1Sata 5/22/97 (Authorized Signature) NCTE : blank not applicable, F 11 in with N/A • SUboontraczO 5 Scheduie S .O .0 S'C ( P3C'rCSAL) FORM 1NrORMA71ON SCHEDULE H :own of Southold Bid Project CED Haul - Disposal Services The Bidder states that it owns the Following pieces of equipment that are available For use on the project , if awarded the agreement . Proposed Current Equipment Item Project Use Equipment Location SEE ATTACHED EQUIPMENT LISTING WM of New York Tac. DBA Name of Bidder /write ManagPmPnf of New York NOTE : Any supplemental attachments or modiFica=ions to this Form shall be labeled Schedule S .O .H and shall be properly in_agrat=d into the Bid Form . IF blank not applicable, Fill in with N/.- Construction Equioment Schedule S .C .H BID QPROPOSAL) FORM i FIGURE 1 i -SCHEDULE OF EQUIPMENT TO BE PROVIDED NUMBER TYPE MAKE MODEL CAPACITY LOADERS 2 CATERPILLAR 980 5 c.y. WHEELOADER or Bucket Equal or Grapple Bucket GRAPPLER 1 EXCAVATOR CATERPILLAR EL300 Grapple or Equal Bucket TRACTORS 3 TRACTOR OTTAWA YARD 50 or HORSE TONS Equal TRACTORS 25 TRACTOR MACK or • Equal TRANSFER TRAILERS 40 TRANSFER EAST 95-100 TRAILER or YARDS 1 Equal Walking Floor 7 The total number of vehicles will be a determination of the Contractor to perform all work as stated in the contract. Star owns and operates 100 p plus comparable vehicles, providing total maintenance and operational experience. Kephart Trucking Co. owns and operates approximately 200 vehicles and provides , long haul transportation. Star will provide emergency services for all vehicles within one hour of breakdown or spillage on public roadways. • LCL 725 NEN YORK, INC FIXED ASSETS - TAX: ATION REPORT REL 06.02.01 PAL .� I FM1110-A oK-z FROM 01-96 THRU 01-( 12 PERIODS F14Y DATE 01/17/97 TIMF 3:51 DIV LOC COPC DISTCOPC ACCTYPE OESCCOE 802802 802818 200 ----------------- ------------ -------—-- - - ---- ---- ---- ---- ------------ ------------------------- ------------ R D ACRS BEGN ASST DEPR INSTALLED ------ DEPRECIATION ----- NET IfIM NUMBER =___= I I E M 0 E S C R 1 P T 1 O N ===== G S CLSS DEPR LIFE METH COST ANNUAL ACCUMULATED BOOK VALUE I ------------ ------------------------------------------- - - ---- ---- ---- ---- ------------ ------------------------- ---- -------- 81820001 1996 INTERNATIONAL MODEL 4900 T D 0796 0796 0700 81820002 1996 INTERNATIONAL MODEL 4900 T D 0796 0796 0700 81820003 1996 INTERNATIONAL MODEL 4900 T 0 0796 0796 0700 81820004 1996 INTERNATIONAL MODEL 4900 T D 0796 0796 0700 818201105 1996 INTERNATIONAL MODEL 4900 T 0 0796 0796 0700 8182onO6 1996 INTERNATIONAL MODEL 4900 T 0 0796 0796 0700 I 81820007 1996 INIFRANTIONAL MODEL 119DO T D 0796 0196 0700 818201108 1996 INTERNATIONAL MOUEL 11900 C/C 1 0 0796 0796 0700 81820009 USED 1987 INTERNATIONAL HARVESTER T 0 0796 0796 0700 81820011 CONTRA REIMBURSEMENT FOR TRUCK PAINTING C D 0396 0600 _ I " ACCT-TYPC 200 TOTALS 10 ASSETS • III it "• OCOPC 802818 TOTALS TO ASSETS i j \ I I II'I 325 NM OF NIN YORK, INC FIXED ASSETS - TAX DEPRECIATION REPORT REL 06.02.01 PAGE 2 1MUW-A TAX BOOK-2 FROM 01-96 TNRU 01-97 FOR 12 PERIODS F14 DATE 01/17/97 TIME 08:03:51 - -------------------- ---- DIV - -DIV I.00 COPC DISiCOPC ACCTYPE DESCCDE 802802 902811 500 ---- --- -------------------------------- ---------- - - ---- ---- ---- ---- ------------ ------------------------- ------------ R 0 ACRS BEGIN ASST DEPR INSTALLED ------ DEPRECIATION ----- NET IILM NUMBER I T E M D E S C R I P T I O N __'__ G S CLSS DEPR LIFE METH COST - ANNUAL ACCUMULATED 0009 VALUE ------------ -- ---------------------- - ---- ---- ---- ---- ------------ - ---------------- ------------ 81150005 CAT 9800 HHEELOADER-USED T D 0796 0796 0700 ON 72500.00 10357.14 61287. 19 11212.81_ » ACLI IYI'I 500 IOIAIS 4 ASSETS 72,500.00 61.287. 19 340,030.52- 1 ,212.81 ---------_----------- --------- DIV Loc COPC DISTCOPC ACCTYPE OESCCOE li 802802 902811 520 81152002 H18HAR-MOUNTING BRACKETS T D 0396 0796 0300 81152003 PARTS FOR KOMATSU FC220LC-3 SHOP #50 T D 0796 0796 0700 x"" CUMI.I ITTD RETIRT MENT AS OF 07/96, SALE " ACCI- IYI'L 520 IOIALS 2 ASSETS DCOPC 802811 IOf AI-S 32 ASSETS V I Ila 325 01 NIH YORK, INC FIXED ASSETS - TAXA, 3ECIATION REPORT REL 06.02.01 rAo` 1 fM14O-A TAX BOOK-2 FROM 01-96 TMRU 01-97 FOR 12 PERIODS F 14 PATE 01/17/91 TIME 08:03:51 niv LOC coPC=----------DISTCOPC=======ACCTYPE========OESCCDE__________________________________________________ 802802 802825 200 _________________-------------------------- - - ---- ---- ---- ---- ------------ ------------------------- ------------ • ' R D ACRS BEGN ASST DEPR INSTALLED DEPRECIATION ----- NET 11LM NUMBER == I T E M D E S C R I P T 1 0 N ===== C S CLSS DEPR LIFE METHCOST ANNUAL ACCUMULATED BOOK VALUE ------------ ------------------------------------------- - - ---- ---- ---- ---- ------------ ------------------------- ------------ 82520001 1976 STRICK TRAILER 12080241 T 0 0796 0796 0700 82520002 1976 SIRICK TRAILER (208044) T D 0196 0796 0700 82520003 1976 STRICK TRAILER (208097) T D 0796 0796 0700 82520004 ALLIED TRUCKS#T11 T D 0796 0796 0100 I 82520005 1986 MACK TRACTOR #228 T F 0596 0796 0500 82520006 1991 MACK TRACK T 0 0796 0196 0700 82520007 1986 HILL ALUMINUM DUMP TRAILER #6 T D 0196 0796 0700 82520008 1988 MACK TRACKTORS T D 0796 0796 0700 I 82520009 KAYOTA - MACK TRUCK T D 0796 0796 0700 82520010 1992 MACK TRACTOR MODEL 011613 T 0 0796 0796 0700 82520011 1992 MACK TRACTOR MODEL C11613 T 0 0796 0196 0700 82520012 1985 MACK TRACTOR #221 T F 0596 0796 0500 82520013 1986 TRACTOR #2110 T F 0596 0796 0500 82520014 1986 MACK TRUCK - #224 T 0 0796 0796 0700 82520015 1985 MACK TRACTOR #220 T F 0596 0796 0500 82520016 1984 FRUEHAUF TRAILER T F 0596 0796 0500 82520017 19811 1KUEPAUF TRAILER T F 0596 0796 0500 82520018 1991 MACK TRACTORS #230 T 0 0796 0796 0700 _ 82520019 1991 TRANSFER TRAILER - 112 LOADMASTER T 0 0796 0196 0700 82520020 1991 IRANSFrR TRAILER - #11 T D 0796 0796 0700 82520021 1991 MACK 11ACTOR #231 T D 0196 0796 0100 82520022. 1991 MACK TRACTORS T D 0796 0796 0700 82520023 86 YANKEE TRAILER (FR ALLIED) •T D 0796 0796 0700 82520024 86 YANRFE IRAIIEII ITR ALLIED1 T D 0196 0796 0700 82520025 86 YARKFE 1RAIIER (FR AILIED) T D 0196 0796 0700 82520026 87 PATRIOT (rR ALLIED( T D 0196 0796 0700 82520027 1987 YANKEL TRAILER T D 0796 0196 0700 82520028 1981 STT-co YANKEE TRAILER T D 0196 0196 0700 825201129 87 PATRIOT (FR ALLIED) T D 0796 0196 0700 82.520030 USI 1) 1987 YARD TRUCK - CHAMPION T D 0796 0796 0700 82520031 19811 MACK TRACTOR #222 T F 0596 0796 0500 82520032 1987 NATEC TRI AXIE - TRAILER T D 0796 0796 0700 82520033 1990 DORSEY DUMP TRAILER T 0 0796 0796 0100 82520034 1986 MACK TRACTOR #225 T D 0196 D196 0100 82520035 1985 MACK TRACTOR #232 T D 0796 0796 0700 82520036 2 BENSON DUMP TRAILERS T 0 0796 0796 0700 82520037 usFD 19911 1111.L STEEL DUMP TRAIL T D 0796 0796 0700 , 82520038 1985 FRUEIIAUF 1R1-AXLE DUMP TRAILERS T 0 0796 0796 0700 82520039 1986 FRUEHAUF TRI-AZLE DUMP TRAILERS T D 0796 0796 0700 82520DIln 1983 IRIILIIAUF TRI-AXLE DUMP TRAIL ENS T D 0796 0796 0700 82520041 1992 MACK TRACTOR MODEL C11613 T D 0196 0796 0700 825200112 1986 MACK TRACTOR MODEL RN713 #245 T D 0196 0796 0700 825200113 1990 FRUEIfAUF STEEL TRI-AXLE DUMP TRAILER T D 0196 0196 0700 82520044 1987 USED MACK TRACTOR MODEL RM613 T 0 0796 0796 0700 _ I625200115 1993 MACK TRACTOR MODEL OV688S T D 0796 0796 0100 GL 325 WM iEW YORK. INC FIXED ASSETS - TAX DEPR (ION REPORT REL 06.02.01 PAGE ✓1 M140-A TAX ...,OK-2 FROM 01-96 TIIRU 01-97 FL. 12 PERIODS 1`14Y DATE 01/17/91 TIME 08: 51 _ ___________________________cv=====__________________________________ IV IOC COPC DISTCOPC ACCTYPE DESCCDE 802802 802813 300 --_ -----_ - - - - - --- - - - ----- --- ----- R D ACRS DEON ASST DEPR _-INSTALLED- - -__-DEPRECIATION__-__- ---NET__-_ I TEM -----1 -- = 1 I C M D E SCR I P T I Ory =___= C 5 CLS- DEPR LIFE METH COST ANNUAL ACCUMULATED ----oog VALUE 1330002 REFUSE CONTAINER 22' T 0 0796 0796 0700 1330003 CONTAINER 25YD 7 0 0796 0796 0700 1330004 26 YO CONTAINER 7 D 0796 0796 0700 1330005 TWO 26YD CONTAINERS T 0 0796 0796 0700 1330006 TIIRIE 22 YARD TUBS T 0 0196 0796 0700 133DO07 ONE 25 YARD CONTAINER T D 0796 0796 0700 1330008 ONE 25 YARD CONTAINER T D 0796 0796 0700 1 1330009 ONE 25 YARD CONTAINER T D 0796 0796 0700 1330010 TWO 25' CONTAINERS T D 0796 0796 0700 1330011 22 YD CONTAINER T D 0796 0796 0700 1330012 JC INDUSTRIES T 0 0196 0796 0700 1330013 CON IAINCR T D 0196 0796 0700 1330014 1 1 1/4YD 1 6YD 1 10YO k 125YO CONTAINERS T D 0796 0796 0700 1330015 f 1 0 fREND CONTAINERS T D 0796 0796 0100 1350002 COMPRESSOR 511P BOCAL T D 0196 0196 0100 1530002 C0117AINENS T 0 0196 0796 0700 ACCT-IYPI 3011 IOIALS 16 ASSETS I ' DCOPC 802813 TOTALS 16 ASSETS BBZ-26-1995 1259 FROM Bender Insurance, Inc. m 17186e MqE P.09 • ALLIED SANITATION, INC. , ETAL, SCHEDULE OF EQUIPMENT CONT23 UF.D -------------------------------- AMOUNT OF YEAR DESCRIPTION =/SERIAL NMMER INSURANCE 079 1988 CAT HYDR EXCA IDL L3400A 4KF00325 $ 92,500 080 PULS JET FABRIC DUST COLLECTOR 5- 40, 000 081 9 MAXON HAND-HELD RADIOS & 2 PORT CHARGERS 082 AT&T COMPUTER $ 65,000 083 PORTABLE FORKLIFT SCALE $ 20, 000 084 TRUMMEL BARRIER $ 55, 000 085 1990 CATERPILLAR 980 $ 227, 000 086 1992 CLARK MOL DPS 30 DIESEL TIRE PKLT TRK ACCES $ 26,154 087 L TO= SELF CLEANING MST 7703, MDL 770455 S 2,500 • 088 L TMUT BAG DUST COLL 883383 s TJ1390-355 $ 1.800 089 1. INTL BALER MDL N1295 $ 45, 000 090 L CAT TOOL CARRIER MDL 1T12B & IXFOO694 S 76',000 091 FORKLIFT $ 20,000 092 GRAPPLER S 120,000 093 MFG BELT FEEDER 5 225, 000 094 HYSTER MDL H80XL2 FORK TRUCK GOOSDO420IR 5 26, 800 095 HYSTER MDL H80XL2 FORK TRUCK GOOSDO420OR S 28, 800 096 1,994 CATERPILLAR 936F BAJO1411 $ 127, 500 097 CENTRAL MFG CO. ROTARY SCREEN $ 45, 500 098 CATERPILLAR EXCAVATOR 320L 9KK02511 $ 132,500 099 CAT WHEEL LOADER 95OF SSKOI082 5 115, 000 100 HYSTER FORKLIFT MDLEBOXL2 GOOSDO5568S $ 28, 800 101 OFFICE TRAILER OL104401 $ 91500 102 1 SIMPL 51X18 FEEDERW/ZGRIZZ $ 43, 940 103 1 SIMP SPEC.LOW 6X20 3 DECK $ 52. 110 104 1 $TRUC STEEL SUPT W/CF;Q'I'ES $ 54, 770 105 CAT I40DEL 936F IT WQHEEL LOADER. 8AJO1411 $ 125, 000 106 HYSTER FORKLIFT H80YL2 GOOSDOSS89S $ 28, 600 107 1994 KOMATSU WHEELOADER WASOO A20840 $ 285, 000 108 1994 KOMATSU MODEL X400 21154 $ 225. 000 109 1994 KOMATSU MODEL PC200 A71288 $ 200, 000 110 CATEPILLAR GAS GENERATOR 4EO0273 $ 295, 000 L11 1993 CATERPILLAR WHEELLOADER 75KO099 S 190, 000 112 WASTE PAPER SORT:NG SYS $ +05. 411 113 3 UNIT SET OF OFFICE -2AILERS $ 71, 195 • 114 OFFICE TRAILER AT WOODSIDE E50712771 $ 14, 712 DEC-26-1995 4-2*50 FR0;1 Bender Insurance. Inc. m 17186297080 P.07 • ALLIED SANITATION, 2140. , STEL. SCSED= OF LV=22= --------------------- A3100D1T OF YEAR DSSrmTvTION ID/SE&IAL NMIBER IRSCRANCS ---- ---------- ---------------- ------m-./ 001 1988 CATERPILLAR GENERATOR 81205532 S: 64,950 002 1985 IM 10 BALER 2024 $: 250,000 003 DETROIT DEISEL GENERATOR 6227-3 $' 30. 000 004 1988 HAZEMAGROCK CRUSHING PLANT HU1314 $749S. 000 005 1987 LINDEMANN WOOD SHREDDING PLANT 860-044 $' 400, 000 006 1987 LINDEMANN COIMUCTION WASTE 861-030 $- S84, 000 007 1.988 NEW HYSTER FORKLIFT MD H100XL FSA-6221) $ 30, 092 008 1969 NEW HYSTER FORKLIFT MD H80XL FOOSA07894J $ 31. 950 009 2,985 KOMATSU D31A TRACMACHINE 33036 $' 35, 000 010 1989 USED CAT EL300 EXCAVATOR 4NF289 $' 165,000 Oil J=VY DUTY EDGE TROMMEL AD0241 $" 210,000 012 3.991 CAT 980C WSEELLOADER 63X8984 t, 262,000 • 013 1993 XOMATSU FRONTENO LOADER A25340 6~ 2031000 014 LINDEMAM DUST REDUCTION CMV 6: 33,500 01S 2.991 CAT 980C WHEELLOADER 63X9012 3: 262, 000 016 3.988 GZNIE BOOM 45881859 $' 25.000 017 LOSLDEMANN S C PICKING BELT 4565-6 $$ 159,750 018 1988 CATERPILLAR 980C WHEELLOADER 63XO7917 $ 140,000 019 i988 KOMATSU 220 GRAPPLER 222248 $ 67,500 020 1992 SCREENING PLANT NEMA ELEC. PAN CECSXI2 $ 58,653 021 1991 NEW ALLIED MDL VI PESETAL BOOM 1341 & 1342 $' 1091000 22 1990 KOMATSU PC200 LC-5 EXCAVATOR A49872 $ 100, 000 023 1992 KOMATSU WHEELLOADER WA450-2 A25218 S 208. 907 024 1992 KOMATSU WHEELLOADER WA180-1 A75148 5 87, 201 02S MOD 723 PORTABLE TROMMEL W/CON 723-04129 S 1881500 026 1993 HYSTER FORKLI3T MODEL H80XL GOOSDOlslOP $ 27, 975 027 1978 TRACK MOBILE MODEL 9TM 9886 $ 70, 000 028 1993 KOMATSU WHEELLOADER WA180-1 A75330 $ 82, 500 029 1993 HYSTER MODEL H80XL FORKLIFT GOOSDO1813P $ 27, 975 030 1993 KOMATSU WHEELLOADER WA450-2 A25340 $ 203,000 031 KOMATSU KYDRAULIC EXCAVATOR A71397 S 190,000 032 KOMATSU EXCAVATOR A25386 S 194, 000 033 KOMATSU EXCz=TOR A80039 $' 160, 000 034 KOMATSU EXCAVATOR A80069 $ 160, 000 035 HYSTER FORKLIFT G005D031$9R $ 28, 000 036 KOMATSU WA800-1 A20886 $ 236, 000 037 KOMATSU WA 420 1 A25084 $ 165, 000 038 KOMATSU PC220LC6 A30161 $ 160. 000 039 KOMATSU PC 300 LCS A71481 $ 190, 000 040 LABOUNTY CONCRETS PULVERIZER CP80101 5 28, 900 • 041 KOMATSU WA 250 1 A65428 $ 94, 000 042 KOMATSU WA 250 1 A65438 5 94, 000 ' •�.lb -Con�.C'cC-�'r5� Tra e-6rs 12. 09/1993 OL KEPHART TRUCKING ---.------_ Equipment Information ime. -------------------- ______ __ -------------------------- ____ 1004-002 1986 FREIGHTLINER ----- Lease : Model : JOAN GREEN Tractor 1004 SIN: 1YUPYDYBEGM277777 Lie: AA64596 State: FA 1004-003 1988 INTERNATIONAL Lease: Model : HAROLD GREEN Tractor 1004 SIN: 2HSFBGSR9JC0lZ26E Sic: AB08470 .,tate: PA 1004-008 1987 INTERNATIONAL Lease: Model: Tractor 1004S/N: 2HSFBJXR5HCO84772 Lie: AH12609 State: PA -- - 1004-013 1-994 FREIGHTLINER Tractor Lease : Model : Lie: AA64594 1004 SIN: 1FUYDDYBOTH88020£ State : PA 1004-015 1994 FREIGHTLINER Tractor Lease : Model: LEWIS DIXON Lie: A839224 1004 SIN: 1FUYDDYB2RH880209 State: PA 1021-008 1965 PETERBILT Tractor • Lease: Model: Lie: ABOO142 1021 SIN: 1XP9D29X7FN19213= State: PA 1021-009 1987 PETERBILT Tractor Lease: Model : Lie: AA91239 1021 S/N: Lie: State: PA 1045-003 1968 FREIGHTLINER Tractor Lease: Model : Lia : AA72213 1045 SIN: 1FUP2RYBEJH33=-52,: Stats : FA 1098-003 1993 PETERBILT Tractor Lease: Model : TIM ELWOOD Lia: AA43092 1098 SIN: 1XP5DB9X9FN32297= State : PA 2004-001 1988 PETERBILT Tractor Lease : Model : Lie: AA85414 2004 SIN: 1XP5DB9X1JN263375 State : PA 208Ei-003 1985 FREIGHTLINER Tractor Lease : Model : 350 Lic: AA84876 2086 SIN' IFUEYCYBXFP269217 State : PA 3026-003 1983 INTERNAT:CNAL Tractor Lease : Model : RECONSTRUCTED Lic : AA77554 3026 SIN: SK7180PA • State : PA 307 -003 1988 INT£RNATICNAL Tractor Lease : Model : Lic: AA87568 307'5 S/N: --HSFBX6R3JC006923 State : PA 3086-003 1993 PETERBILT Tractor Lease : Model : B.DEANNE ELWOOD Lic: AA44226 3086 SIN: 1XPSDB9XXPN33.3324 State : FA • 1=. i _ QL 'EF. HAF:T TaIjCLrING CO. Equipment Inf:•rmation -.Menu` . _ -------------------- --------------- - - - - - - - ------------------- --------------- - - - - - 1; :% FRUEHAUF Dump-- r.al I ?r L l c : T7 State : PA _.';, : ;aoea�_�_r'F:oo�ll •+ 1 -'?' RUEHnUF uurnp Tr a. t i e Moae . : Lic : TT 4:"? 'Q/N. IH4D438'2.51>l..•. . _- . _ =tate : Fa 1'x,7 1940 FRUEHAUF Durnp Trai 1 er Mae l : .- — -_Lic : TV15=T= —. S/N: 1H4UCtI!' 4Lk01E.0. State : PA 1.'S•' . FRUEHAUE_- - --. i:m Tra.1 . M,?del : Li c:.1L54TS S/N: :H4DC= rZct;l;pc Stare : PA - Flat -- Mndel : ": c : T'va='? = S State * FRUEHAUF ^ump Tr % ,3t• ,- I Lig T"'1•J'".�1 • S/N: 1H4D0382 U-.O ;150F tate : PA $0T 1:;%3i : .UEHAUF Flat — ,aePA l : — �1a*. JBrJ.' 1 .• _ '.� rc _ . Mn•ie I : Lit :_ N: _HMr_ —. t3te :_..• . -. J:_< • 1'-'=':. -AUF 7!14-i -127 SI/N: - c,�F,r� -, Stat? : FL-at L - - M ae1 iC : -r 1 SJ.:: .. ^'r�r4=W::JMO-: i :�?1 =tsr? : F'A j ;,4,-, 1 -,_ 3 =UEHAUF Flat — Lic : Maael : :H4Fir4_-7EFC)L taJ:.e_ . F4 _ .. .. : j - 198': FSUEHAUF ^ur,�G Trat er- r..- zI .—_ ---- 21,N : ,H4D()34Z5Jt Star, FA • J.•, 1924 anUEHAUF- FJ3.i ---- —. — . Model : Lic : TZ_": 'S S/N: . . - - - - - State : FA 19S4FFUEHAUF - .. -- -. . - F I at L t c c :'A4:� T4 Model : r— ago Equipment Information .rlenu Wal4ciri3 Ft aur - i1Q- -.. 1; •. L 'F�Er' Lic : ltA1. • 1' Mo,ie I 1DTW1cWL ;r-;Pi: State - PA DORSEY -' L4 l 6 1 n9 1�. _r •_ : :;AIS 114 M ?,tai . PA. DORSEY Wa I k i rn-3 Mode I - - Lic . - IDTW1 WZ4NP0-X,655 State : PA WaLkj--a3 1144.---• l:' Dr]FSEL__ _Lic : YA13115 Model : State : IPAS/N: 1DTW1 =W-:NP03n .Fr!. - • ice,,... '--'- '- --- " q� DORSEY n--; F 1 99Z _ _'r• --- '-- 1 Lic :- A1� 11 Madel Si N: :BTW 1ctWL;NPCP=C+c._1 a:_ : -•- Wa l k: i n3 ! •>,:. LI c • Mode I : .:A1 LI-T_ Si r.: L C-TW 13W::;NFO Ge,S; States PA - _RSEY --- Wal4: inS _ --- L l c : Model : PA S/N: tDTW1:_WL'INPU=C'o5: �tste : ---ta.-,'_ DORSEY 1D'TLJl :W� NF : : . . . 119C) 19: - DGFSfiY LStatc SYN, ;i'TWr:F•:' : . : _ ;R. EYlda 1. - Moydel : L i c S/N: 'aTW1'=WZiNF02 : _ _ _ ;tLA a c-e : F'A 3 1'. 1 _ DUF3�`/ Lic`: ;( F Z. 1 1 mc.de I 7JESi.Cbc 3.ta.e : F 4 —_ 1 .-- - — Lic : .-?1'= •-- -- Mode I _ 3t a �n n3._F1:•gr ,.ir 1pc CirF3EY Lic modeI _ cq c - ---. vIng FI ,>nr- r: l.:_;:i i•r,_;^ F^-.E Lic : '4A1m='124 m.),je I F'A-- S/N:_ :DTW18W --- pl F c =+A TRUCKING CO. - ' - Equipment Information (Men,:- -.-_------ 1J -ZIAXTER 11-111-T ------------------Dump Trailer -_ Li c.A. TSoT_ Madel : FA - S/N :'DL c State : i 4i 1':'$'=' TRAN:SCFAr- F 1 at - Mr?•: sl : TL'?nt:: Lic : • 31>. _ -_ _S/N: 1TTF45 Oi .1G: ! State : PA— "OC—:5c) 1989 TRANSCRAFT Flat Mode11: S/N: 1TTF4Z1.06K1U =Loa State : PA 1?ISs-DQFSEY Fla t- Mode i : DGT1-::'P45 Lic : TT540-11: S/N: 1DTFIE.WZFI F :L'.,_4 E:ate : FA :087(:) 19G;9 DORSEY — Flat r -- Model : DGTLS945 Li -: T754�i'= Sin: ..1DTP15WZ7t:P0=,_-:1--5 _ SJLat.e : PA. — F4NTAINE . ing Flat _ • Model W'ZAW Si:=. 1.^••NA4 ^�?bt154?_ Stat. : PA. RSE Mode I : DGTL*?.9 S/N: 1.7Tr1 :W.: 7,LF 0.1ota Model Lic : TVV4 1V' ;.i ;.: :_-- •,a.;.:-_. _^a__ __._:Mate : F': . ,j:.lQ 1•::-�� CCF�c': Fiat M L i C : TV `14 - = /N : _ =7� I WL: _F' :=: State : FA 1' ?o _ _:RsEY— _ _. ------- Model Model : DUL-29 Lic : SIN: tDTF'L• W _LF'0= 4LT State : FA ni!RSE'f .. FI at _ _ .. .. Model : OGTLS9 Lic : TV4,' :71 _DTFI6WL'-LF'i!L_ -_- —._ State : iti . . .M01e I . ...�GTLz ' ._ - _�J.S_� -,:i • SIN: !DTFit.WZ4LF'`',L'_4Lc State : =L — 0 C 0 R EY - --- F-Lat Mode CTGL89 _ Lic : T S/N: :CTP IcWLcLF,:`__ .c State : FA Flat Model : DGTL':'% Lic : 7S'4177 1DTF1tWLLLF0-L 4_`: __. _ .tate.: F.4— - • _ •r.•a,: 01 KEFHAR . TRUCKING_CO. -- Equipment Inf : at ` : r• iMenu- -------------------------------- ------ --------- � 4071. L,-.y I EAST Mo-ie ; . UNLOADEF.i . .c. _ L1 c : Sirs: 4071 ldaik: ir.3 Mode i : 'UNLOADEt:/REj4T.;... L.r c : -• .l: M:4�U'= ---- -- State : PA 4q__ r 1993 EAST—MFG Wall: rn3 Floor — -- Model : UNLOADEP/REr'!TAL state ; PA SIN: M14Z_ ! _19S•4 -EAST r1F.G —. _Dump Lic : TV30"52 Moaei : - =tate PA __ Dump Trar Ier -- .0430 t'-_." EAST MFG Li c : TL6c'0T6 Mode I : PAS/N: 1E1Dza _AER J05'7 O a iTS5 EAST MFG �cmp T:• : : M4 d b i LLL. Zvr S/N: lE1D_F33>:RFL• Stab Dump PA L-PS-5, EAST. MEG _ M. , .. 11E1DZRc _1=R•L` "tg._ ' .a MFGDump Tr•ar Ier ---- Y047it 1i•85 Ei-ST -iFG Lac : M:de-I - _ _ - er 13c`u..EAST_MFG L i c : TNb77:-J cr >del : _ ,'•N: IElD_R T-Gr-H.?747= _:a: a . FA -- C`..r L r c : TNZ:7-41.1 MODE /N: 1E1D F;Z'_ -F:H•,,747 =tate : Fa -- '-" atop f ar- C EAST -F --- _ Model :—. --- - _:. _.-- • SIN: 1EIDZR-- FAA _2„rn G=-11'a r I e r.... : .. _ic : TN87 , 41 Madel �A S/N: ---- - LM C, Trac ier _ �•V:O_=;j 'c7 EAST FG . Lic : 7P—7'7•'S Model S/N:_._E1DZfi ==rRG9Z82 _ State : FA • _ ____ 1_IU'i! 1:% '' - G1 __ t.Et:, L:.:T TRUC}'ING Co. =•:uiF•t�er,t Information (Menu-T' ------------------- 1 �UUca_ + ?7O_SIi:C:_ :!: ---- D=p 7,-ai I e — Lea=_ e . Model . _ LIC : -� .- 713: SIC!: _'7e_-- - _ . - e . PA 1'%7=' -. ';VK Cump . : I er 352 : Madel : 713':_ )IU 1'5,7Cr TRAILCO Dump Trai ler Lease : -- Model-:-- -. Lica State :71C.z SIN: 4*eO State : PA -*W. 19735--•RAILCO Dump TrL: I er, Lease : Model : L.: c . 71 _ SIN: 1065£ _. _.. ___ ten PA 3 -Sta 1.'.' irk 1993 RAVENS Fiat - -- Leave : Madel : L'OC TR---T Lic : TV41677 _- 11-:.' ,^;/N: IRIFZ487FJ ' :'3'.: T' date,.- FA._._ 7 _-- 134-40_ 19.5 vULCAN Flat • Leas : Mei.e1 . .. 1r.! :SNEDEC:: LIC: TP43_:%5 T134 SIN: 1LZF4S_0-F1.4i1Ci:c Stats : PA '`: -r .: 1' r•:4 7 %ANSCRAT- • _ . _ Leases Me.ael . JOHN DAVIS `PA" 71 . = S:1'•1: 7 ;�= -i•._ _ tea. State : 3FC 4 19+c::3 E:+'FT Wall' in9 FI : •; ' Model SIN:.. 1E1: ::._ _:z:_ . ' . _ Stat. ar=C 1'¢-�. EAS r :.,c.. - :I l i , SIN: 1E1P1W o=_RL•'C,"C =; _tat . —I9'vz EAST MF-G- .. —. itis i i. i n3�1 or Model : Lic : 7V16961 SIN: Lt' ='.'.Jt 3c JFC . . :�a PAJ -• �R---i llS,_=: C c, EAS i ^Fu Mnjel : Lic : `V1,_.•o._.i, - State : P-A _ -- '-- :Z1 L::% 'd G Flat --Li C :-Ti`1C.i_`_ _� ._... -- SIN: '_'.Q'.- t ,F 00 :17 State : FA • H4u::5--- 199 EAST `'FG - ---- —_ . Wa11. : :•a ��.uur . ..-- - — modet : UNLGADZ F-:EPiTAL Lic : /N: L140o5 -- -- 1'�'% EA=T MFG :.al �: in•3 FI •,gr I H4,�7�_. .. Mode l : UNLCADEF. FE^17AL. Lic : M14+170 __. .. _ Stata : . F:A - •- i `EFHART— TRUCY.ING CG. Equiprner,t Inforrnat •: . Mar.. ---------------------------------------- ------- ---- ------------------------- -` C` ,c + ' '=': EAST MFG ._ _ Duma Trar ! er _ Lease . Mpdei . JE:7 RC1L5CL. Lic . 7T41C 1 7Gc.c. SIN: .E1F9U.- 7VRE10485 State : P.a ' Lease : M :.1ei : LY%N ENC-LISH Lic : TV"+L'S ='= •%: o Si Nt-1E11= .L�?-:LF:D117a= � .- �'.a TO's 7/-00r°' 1985 RAVENS Flat Lease : — Model : GLENN STOC}: Lc c-- T3<i.7GG. 70199 SIN: IRIF044Z4FE-=5C`74.:1 State : OH S5 RAVENS -- - --•---Fiat---. -_- Lease : Model : ARTHUR CODE= 1F'1;:3�-"E3g1C' . estate : C11-RA r.' . .. _. Du .: �'• 1 I I er 117 - +I)� 1:�_• ' _ Lease : Modal : KE11IN MEYER Lic : To59L04 7017.'- :!: .. S'DS• . EL•:5}:11�31== GtetE : PA :NTA.INE FI at • Lear a : — Modal : RON NASD Lic : T'rSS509 _.. . F./N: INI-;S 5i 1 : Wit : ?A Flat Lease': M.:de ! ;_ :ra_= dIS _i : . -=. =.•34 Lease : Z LI 'Lai&.¢ - Mode MI! C r:a : _ _. _ . -=4: 3u5�_..-- S/N: :F77=" . = 1 - -- - State ; =a FRUEi,AuF r--_ •--- J YP Lei= - . M{ ue 708rr S/N: Stata . =A 1�i.'�9 F,AVr- -- 'umc. --,a I i ar •i1?G-. LJ� . Lease : Mo•]el : LIc : =47 F=.UEHAUF F l at L2=152 J_ MJ.:21 JIM _ul'1.`-.. __-_ L. 1 - • 705%7 SiN : 1H5F045.14.r.0'= --tare : 7_; 7i r.i? 3:tJ : : A1 4 7 --A Ztate : Fa Lease : MO.:a DAVE -=aNY.•- \UEC=, _ . c . 7t>'B7 —S/N: .D•TFIi_-WL. =tate : PA—_.-- - • 1_, V1_Y.EFHAF.T TRUCKING CV. EquIpmec* :nf : - ,,,atiorr 'Me r•,-- ------------------------------------------ - ---- Q75 - Lease : Mr,deI -- TM1:=444�. 075 :_�.�•- _ �}.M,,;. .11_I_ tate : FA ",FG Duna 71-3.1 I er - Lease : Model : G.DEANNE EL1.•:OD :i�:3._ �/N: lE1D'.'_DZ..^-•OFFFr:---^:.F' Stara : :.. s1 20SS Fl at Moue.l.--EZ. ';f PEF .-- .L1L:- 161_3 S/PI: 1DgF(.i_":=FiJi1C_:1? .`.-.tate : FA 19£9 DG,RSEY_. _-._ .. Dump Trai_l.er - . Lease : ml:'.: 700 MA,.c. Lr _ . TF7d�15 44 IDTD. :=N_:.: _ . _-_" State: . PA _- 0:37-< _ 4 1'F T:'c.: :,r. Dump TralIer - Lease : Model : BOB WELLS LJt : TN===•`- 4C.3:_7 ..^-.r/N: "r'r"E.AATZ':L.'r--.0L:11.1 ."ba-.c : _n' - - 03C-00" 1 ?' S '_.DI:•;:}y Durnp Tral t 2r• 7=4ic':+:: S:M: 1T9ZAA7 ___:?r State : PA .06:3-003 _ . PSS. WILl:3:iS ylat}1n3 .F1 _c,r ... c.QaB 3/r:. Stat_ . PA G�:np Tri1 ?r ...-A _ Le3iie : Mod aI — _.ii4: .t3t2 :—F A. =:F EAST MFG DL:a:., -";-c. . a:' TT 70,•1 0; .. . 1EID12- R . . _ _ . State : FA - Lc35a ; Mid21 _rc . TT 0:%(iU 7031 /N: I-R1Dl o_ .. .n_ Stat FA _ is :�-•: ,J� l r,:,l :-NTAINE - 1 at Leas Madel : MARVIN MYEF- 7S;N : . _N 145-_-01:: . - - _ E. ST MFG :_: .o ,'akar Le as a:— Mr .al TU:=F - -- - - - • - -,- - Ti _':4 r: : :E1F9U_=2FR! : _ c.a State : F.4 • -: -,ii,� 1'a:_; avEPJS --- - flat - - L2& Llc Y5_.: : R1F1 .4 _ L_; E _ -, 1 .;:c State : FA Lease : Maaei !ACP IE NEF- arc : 7Y127 __ 7J:.-4 %/N: • --- —.. :_. : / , - O1 . KEPHAFT aent Informatior, !Merru-T tquipr - ----------------------------------------------- -------------------------__-- =-EIGHTLINER - - Trac r' Mode ; FLC1::O :4ST ` i : : "�: .FU'!' C'!L•S�H3 c:1> 1 estate : PA 12= EQUIJ4.1?•it 1 :2h1L • 1_;r ry i 1::a';3 41 KEF'HAF:T TRUCY?NG C'C'. _qLi prOef.t Tr$i tuatir•.ry (Menu- _ - -- _--$.-------------------------- __------___- 15Ly Tractor .�NTEFtI1ASI GNAL_.___ Lic : AA44S4ti . INTEFNATIONA,_. Mo.1e I . ?•?Q L:c : AA44•_t•8 PA '14 19^:y INTERNATIONAL Tractor —. —Mojd.e_L... ?300 _ .-_1.15.- iA44 S/N: _HSFCXZR7k:C:0_4-:c0 State : PA 5 —1S9 INTEENAII,:PIAL _ . . _. Tractor Mode t : :DSOO :-; C : AA44,t,7.2! State : FA. 1'- '= ir4'TE:':,;TIONAL Tractor Model : 9300 Lici AA4.1,74 SIN: -;.r0Z1457 —._ 3tasa : PA --- . 7 19S.,P INTEFMATIONA_ -- Tr ac t L ar mo.; i . •:i S/N: :PC-F"'ZR':,F. CI)'- + State: PA IT "?EISHTL:!;EF. —.Tractor. M:•dei , L: : : _• S/N: .FUF rState : =A cl _ Trac,: Mr:deI C ' MO ~AF1:1� I ire AF20(ry74 a 1%8:: =REICIhTLL;:ER -- Tractor — -.- -- Model .-LIC : S/N: : 7UY=C7_•: ,H3= 1'c,- Skate : FA ;REIuHTL:' EF. Tr-ac : : r .. mc.del FLC1C0._ -:-•.T Lic : :cUY=CYE. _H _: : :' 1 =:ata : FA ___ .o1El�HTL_':EF Trac :: r' • /N: :FUY-C.YG'c ,Hta:a : FA 1V1 _— is rr.=lC3HTL.L"I'LF. __. __ZYaCt^f z : :FU'r_:YP1 .:H___ _ : : State : FA FFEi =HTLiNEF Trac := r - Mo-1e1 : FLC1'=4o4ST Lic : GA :FUY=CY63JH--'-=�'-S7 -- _ _. Mate,_ _ ... -- —1 ==HART TRUC1'.::.0 C- . - - Equip-merit rrnat i <.r. ( n Meu- --------------------------- ,-- . .---- FRE: =:-tTL:NEF ---- Tract-: ,- .ease : Mode I :...L•'ERNARi C'L: "l: ?�UPY_YS'• FH[:bc�4c• state : FA . --- 1:•actor Lease : Model : ALAN SMITH _HSFE• UR:.JC . . _ ___ GMC Tracts : easel... Mc..7e 1 : BILL ALLEMAN Li c s_ ; Pik c� ----- '1Vb 5/N: 4VIWDPJFIKNa:-1 _- State : Pik r1L�i'tirl 19'-?4 MACK .ease : M.s :zl : ED �A.FA+3H l'a=- . e. i 1 G ^-.!SIV : l i".C'..4A 14'r :_idiy;::_44.E - • 1 [XI I 1954 WESTERN STAR -- --- ";c• .,, -1 .e : . MIt;E HUSTED Lr c : _ - r z:1 i .ri _ ^��1: _WF:F'DCCGeu:: =- Mate: PA .- -- _ •?9i: PETERL•'ILT Trac t•,)r• • I--base : Model : MICHAEL LA:_ state: FA — Ti V., S/N: 1XPt3DG'?%,XLN'� .-5C. =• :':'I _':,_'P _FETE' .- :L- __ Trac- . — Lra :e ; Model . DWIGHT - ILL . : • _: ;: . . .:FF=i 'i%;4} D�7:'1= _ stats : F'ETEF'CILT _ Ar, 73--4 . '_ease : Mnozi _ ;= - 1 : cr _TAF 1__-x•_ 1 ' _ __ . . ! �- ._7r) Lease: JSa �z.l : _ _: ':AFS n•4L_ _ — �_:� : !.I. CWF:.F'DGCG7F}.','1 1 INT .ENALIONAL A —__- - Lease : Model : JI"1 'SPP • _: c : X6r A 1'P 71 =REIGHTLINER - - _ Tractor Laa=_ e : Mndei : JOE CL- :, i_ =ia; � 4 71:=? S/N: _IEUPDSYL H4 =17_: rETER LILT Trac . -.el LEFr:IE rQL: -F _. c : . =o:: :` . —_ . : CG r,-- -T51 _ St a . • _ : __ _ Tr-ac ; : r- 1:: '_ - _ ul NTEF:N9SICNA:.. _ : c : Lease : 1'^.el : aNDN `r EEL r - 71 - 1 /N: ata . FA T1 : - - i01 1'i S'o --- - Tr ac L^r ENWUFTH --- � ic : j' Lease : MoIeI =tate : `A ---- -- --- 12.'09/1993 O1 KEPHART TRUCKING CO. Equipment Information (Menu-T ---------- -------- ----------------- ------------------- - 4028-002 1989 DORSEY Dump Trailer _ `.ease : Model : TOM MANEY Lic: TP76815 --. 4028 SIN: 1DTD38N28KP027204 State : PA "367-004 1989 TIBROOK Dump Trailer Lease : Model : BOB WELLS Lic: TV23052 4087 SIN: 1T9EAAT28KBO21010 State : PA 032-002 1988 TIBROOK Dump Trailer Lease : Model : Lie: T547398 6032 SIN: 1T9EAAT26JB021330 State : PA 048-003 1988 WILKENS Walking Floor Lease : Model : Lic: TY40789 6048 SIN: 1W92M4524JB077171 State : PA oO98-003 1985 COBRA Dump Trailer Lease: Model : Lic: TW97302 6098 SIN: LC9FA39B2F2133458 State: PA 7031--002 1985 EAST MFG Dump Trailer Lease : Model : Lic: TT30960 7031 S/N: 1E1D1S28:�FRBO633E. State : PA 7031-004 1987 RAVENS Dump Trailer Lease : Model: Lic : TT30960 7031 SIN : 1R1D1382:'HE87000S State : PA • 1032-002 1991 FONTAINE Flat Lease : Model : MARVIN MYERS Lic : TZ62688 7032 SIN : 13N145308M155138` State : PA 7034-004 1993 EAST MFG Dump Trailer Lease : Model : TUFFY Lic : TD72164 7034 SIN : 1E1F9U288FRJ1388E State : PA 7036-005 1989 RAVENS Flat Lea e : Model: RICKY BARRETT Lic : TY53133 7036 SIN : IRIF1452OKES9108 State : FA 7036-006 1992 RAVENS Flat Lease : Model : JACKIE NEFF Lic : TY13736 7036 SIN : 1R1F04521NJ923146 State : PA 7038-003 1988 TRANSCRAFT Flat 3638 Lease : Model : Lic : T'1 PA • 7038 SIN : ITTF45207J1030993 State : PA 7043-002 1990 TRANSCRAFT Flat Lease : Model : CHARLIE EBERHART Lic : TY44162 7043 SIN: 1TTY4520SLI034067 State : PA 7043-004 1993 TRAILMOBILE Flat Model :, FRED DOBSON Lic : TZ42210 Lease : State : PA 77)4'3 5/N : 1PTFS1TS1P9007924 12:09/1993 01 KEPHART TRUCKING =:. Equipment Information 'Mena-" •-----•---------------------------------------------- --------------- 7116-006 1993 EAST MFG Dump Trailer -Lease : Model : ED RAPACH Lic : 394857 7116 SIN: LE1F9U281FRE14280 State : ME '7119-002 1984 HILL AND STRAUS Walking Floor Lease : Model : MICHAEL LAIR Lic: TY31698 7119 SIN: LA9SXT82XE1022075 State : PA 7119-004 1994 EAST MFG Walking Floor Lease : Model : Lie : TEMP 7119 SIN: lElUIX284RRK15760 State : PA 7119-006 1994 EAST MFG Walking Floor Lease : Model : Lic : TEMP , 7119 SIN: lElUIX286RRK15761 State : PA 7120-002 1989 FRUEHAUF Dump Trailer Lease: Model : DWIGHT MILLER Lic: T540948 7120 SIN: 1H4DO3823KK.000102 State : PA • 7123-002 1980 RAVENS Flat Lease : Model : BOB MARSHALL Lic: TS57902 7123 SIN: 80718 State : PA 7129-002 1989 DORSEY Flat Lease : Model : JOE BLICKLEY Lic : 531-778 7129 SIN: 1LTPl6W221:PO26057 State: ME 7129-004 1990 TRANSCRAFT Flat Lease : Model : JOE BLICKLEY Lic : XAI�035 7129 SIN : 1TTF45206L1033984 tate : PA 7130•-002 1989 DORSEY Dump Trailer Lease : Model : BERNARD FOLMAR Lic : TZ85338 7130 SIN : LDTD38N211'P0272l- State : PA 7132-002 1969 TIBROOK Pump Trailer Lease : Model * Lic : '�7 7132 SIN: 292293 State : PA •7132-004 TIBROOK Dump Trailer Lease : Model : Lic : '>' 7132 SIN : 22582259 State : PA 7132-006 1970 71BROOK Pump Trailer Lease : Model : Lic : 7) • 7132 SIN : 237632377 State : PA 7132-008 1976 TIBROOK Dump Trailer Lease : Model : Lic : 77 7132 SIN : 75310 State : PA 7132-010 1970 TRAILCO Dump Trailer Lease : model : . Lic: 7? 7132 SIN: 4080 State : PA 12%09/ 199? 01 KEFHART TRUCKING CO. Equipment Information (Menu ------------------------------------------------•-------------------------- KMJ602. 1984 FRUEHAUF Flat Model : Lic: TV46176 S/N : 1H4PO4526FF017602 State : PA KMJ604 1984 FRUEHAUF Flat Model : Lic: TV46178 S/N: 1H490452"F017604 State : PA 30 Equipment Items listed • 1/09/ 1993 01 KEPHART TRUCKING CC Equipment Information !Menu ------------------------------ ---------------- 24 SPECIAL CONTRUCTION Flat Model : LOW BOY Lic : TN12425 SIN : T55183PA State : PA 3 1992 SPECIAL CONTRUCTION Flat Model : WALLYS TRAILER Lic : TS87373 SIN : SW50796PA State : PA 31 BOSS Flat Model : EZ SLEEP Lie : TN61253 SIN: 16DSF0826GP000317 State : PA EZ1 1986 BOSS Flat Model : Lic : TN61253 SIN : 16DSF082E.GP000317 State : PA K0840 1989 TRANSCRAFT Flat Model : TL90K Lic : TS14172 SIN: ITTF4520OK1033073 State : PA • KOSSO 1989 TRANSCRAFT Flat Model : TL90K Lic: TT54030 SIN : ITTF45206KI033269 State : PA K0860 L989 DORSEY Flat Model : DGTL8945 Lic : TTS4033 SIN : 1DTP16W25KP0_7364 State : PA K0870 1989 DORSEY Flat Model : DGTL8945 Lic : 7T54032 SIN : _DTP16W27KP027365 State : PA K0890 1990 DORSEY Flat Model : DGTL89 Lic : TV04108 SIN : 1DTP16W29LP029423 State : PA K0900 1.990 DORSEY Flat Model : DGTL89 Lic : TV04109 SIN : 1DTP16W27LP02-�42= State : PA K0910 1990 DORSEY Flat Model : DGTL89 Lic : TV35014 SIN : LDTP16W2CLF023424 State : PA K0920 1990 DORSEY Flat • Model : DGTL89 Lic : TV35013 SIN : 1DTP16W22LF025425 State : PA K0930 1990 DORSEY Flat Model : DGTL89 Lic : TV46171 SIN : LDTP16W26LP028427 State : PA K0940 1990 DORSEY Flat Model :-DGTL89 Lic : TV46172 S/N : 1DTP16W24LP028426 State : PA 12/09/ 1993 01 KEPHART TRUCKING Equipment Information (Ker ---•--------------------------------------------- ----------- K0660 1988 RAVENS Dump Trailer Model : 10396468113941 Lic: TS14178 SIN : iR1D13923JE860442 State : PA K066T 1986 EAST MFG Dump Trailer Model: Lic: TV35015 SIN: 1E1D2R286GREO738- State : PA K0670 1988 RAVENS Dump Trailer Model : 10396468113941 Lic: TZ47572 SIN: IRID13925JESS0443 State : FA K0660 1988 RAVENS Dump Trailer Model : 10396468113941 Lic: TS14176 SIN: 1R1D13926JE68053= State : PA K0690 1988 RAVENS Dump Trailer Model : 10396468113941 Lie: TS14175 SIN: 1RID13925JESS0534 State : PA . KO'790 1985 EAST MFG Dump Trailer Model : Lic: TT43754 SIN: 1E1D2R382FRJO598c State : PA KO800 1989 BAXTER BUILT Dump Trailer Model : Lic: TS87379 5/N: 1B9D2402`_KP1S580C�4 State : PA K0810 1989 BAXTER BUILT Dump Trailer Model : Lic : T587378 SIN : !B9D24027F:P1a8005 State : PA K1290 1987 COBRA Dump Trailer Model : Lic : TN87734 SIN: 1C91)A36C3H1133835 State : PA K7.300 1989 RAVENS Dump Trailer Model : Lic: TY57280 SIN: !R1D1402F'.�ES90068 State : PA KB109 1986 EAST MFG Dump Trailer Model : Lic : TV35010 SIN : 1E1D2R285GRL';S865 State : PA KB110 1986 EAST MFG Dump Trailer • Model : Lic : TV35011 SIN : 1E1D2R267GRLCEB66 State : PA KB111 1985 SPECIAL CCNT-UCTION Dump Trailer Model : Lic : TV29289 SIN : 7R76633PA State : PA KJ129 1986 FRUE!iAUF Dump Trailer Model: Lic: TS40957 SIN: 1H4DO34271KO44502 State : PA • 12/09/ 1991 01 KEPHART TRUCKING C Equipment Information !Mer ---------------------------------------------•------------------------------ K1090 1992 DORSEY Walking Floor Model : Lie : XA18111 SIN : 1DTW18W27NP030651 State : PA K1100 1992 DORSEY Walking Floor Model : Lie : XA18112 SIN : IDTWlSW25NP030650 State : PA K1110 1992 DORSEY Walking Floor Model : Lie : XA18113 SIN: 1DTW18W2ONPO30653 State: PA K11.20 1992 DORSEY Walking Floor Model : Lie: XA18114 SIN : IDTWlSW22NP030654 State : PA K1130 1992 DORSEY Walking Floor Model : Lic: XA32945 SIN: LDTW18W24NP030655 State: PA K1140 1992 DORSEY Walking Floor Model : Lie: XA18115 SIN : 1DTW18W26NPO30656 State: PA K1150 1992 DORSEY Walking Floor Model : Lic: XA18116 SIN : 1DTW18W2XNP030661 State : PA K1160 1992 DORSEY Walking Floor Model : Lic : XA18117 SIN , 1DTWl8W2,XNP03J65E State : PA K1170 1992 DORSEY Walking Floor Model : Lic : XA18118 SIN : 1DTW18W21SP030659 State : PA K1.180 1992 DORSEY Walking Floor Model : Lic : XA16119 SIN : :DTW18W2'-NP03066•) State : PA K1190 1992 DORSEY Walking Floor Model : Lic : XA18120 SIN : 1DTW18S42SNP030657 State : PA K1200 1992 DORSEY Walking Floor • Model : Lic: XA32946 SIN : 1DTW18W21NP030662 State : PA K1210 1992 DORSEY Walking Floor Model : Lic: XA18121 SIN : LDTW18W2=NP030663 State : PA K1220 1992 DORSEY Walking Floor Model : Lic: XA18122 SIN : 1DTWISW25NP030664 State: PA i • 1_, :,•:, . c,•:. Cil KEPH.ART TRLlU'PIG -- - Equ + p;ner,t Infr.rmati „n .Menu-- -------- -------------------------------------------- ;' Cu'+ FF:EI!HTL_:.EF. - Tract :r' .ea=_ e : Model : FRED Di_+L'SCN Lic : ASl57'7,1 �•;. U'.rr,. ,: - State : a ...HCC ... - :•3L tor' Li c : ASSOSOO .ease : Model : CHARLIE ELcFHART �.1 151S7 FORD Lic easPLL __--Model : ROSBIE = IERCE State : FA — ;44 SIN: 1FDYA90,NX-HVAvc.454 -1's-.S_.FRESGHTLIf;ER M?del : RON 'STYER-7 Lic : AA'--4F071 FUPY"YVJ r, 47-.ii+l 15'c'? FORD Tractor- - - aa_e : Mc,,iei : LARF:Y - '!CILic : AA'9d:•�:O 7042 SIN: 1FDYA'?G;:4LVA`:_ ._ _ • r7-!ip: :•;••g•:• FT,EF.G'ILT Tractor ai5e ; Mo'iei : CHIS r?E IRV LiC : -, 4- S:N: SXFFDC'�'; :i'N'7:7- state : FA FORD.. Tr t . - •.,L - l..I C : 4U`.(14:61 Lease : M.?aei . HUan _ _ 4 MAC.}. `r- r- eaee : .._ . Mode I . =A°1L" : _^+u ._'. L.- j ic.:._�C1 - - - S - . . - • 'te ' FA - ;-' =F.EI!e-HTL?NEF: --- -- Tr actor ---- LI c SIN: FETEnc IL- Tr'aC : >r Lic : F'4A!-U —ease7,:!E . SLN. I _.'.F'5DLi, a= tit" L+ = : F - ' ----_ _. State : ]H Tr-actc'r Lea- = M.: ` _ _ Erb - '_---- " . r :tate . FA _ :>_,5 :',ACsa_ . --Tr Model : RODNEY =MI-'- Lic : AA:A__ Leasee State : FA :Ci' T1`'?Y1FMr='- - -1` --_ — -- -- • 1__: . _ 01 1:EEhAE.- TRU! VING Cr ---- — Equ i �•tne,-1: Inf or:nat i an iMenu ---------- ------- _ FREhY.iL: :ch----__. - - i. ac:OC_ Mr =_ ' GErsRGE -i 1. -- _ c . AAS=64 S/N. 1FUF_i:YL�I N:_ _ _ FA M. d e i : RWr-1' _ 15"=': MACE: Tract S/N: 1M'_'AYCi4YZF.M : . `_ ?40;1 State : PA Tri —L•�^o ' MACK— -- -- ... 7-r3Ltor _ Mo.el RW.. Lic : .4A:_a137 i • 1� rp MACK - Madel : CH61 ' Lic : AAS'i_4 Mate : PA.- - - --- • %t 1S%+? MACY 1 r•a.L'., IMYAg4Y4jN,:. - Lic "A4Fl '1 1 . F.bF_ -- SiN: 1MSAYii4TKMV:• _ State : F� 1' MAOI Tr-3C U?r_ SIN., �Y _Y I _ _. . . _ _• _ . a : . . r A. Z55 1 ?�S • ACK M�,.. pi RW6I —. ---- "--- AA4- - S;N : '^ =Ar.: ;Jfn ' . _ : State : PA w Tract : r- •: ? I. `6.: _ _ Lic : M -- _ _ F AM;_A Y 1: 4Y1 � • M ? : 2 nW•. : I AA7:=c , • _- - _ �t_L _ F4 PA _ Mnu? FEC�_N�T-iJC-Er _ ; c . -A7•._ - ' Lease : ---- • --- — 1 .:"[:=_ 4L. KEPHAF.T TI F'-:`'I Equi :•-^ent ini :rmatton (Menu- ---•------------------------------------------- -- --------------------------- -_ 7REZZZ41-L;JEAN _Tractc+r__. -. Model : FLD1=:'_4ST Lic : AS3'F'I:%c uii� : _ i•RA4 ::,:,c�9 Model : CH613 LJc : A`'= ` - S;I.: 7=. =tate : Pik __-••-- 164 1:% MACK Tractor _ Mode1.:. CH61_ L i c : AS' ':'i /N: 1MIAA1 Y•_;Wr.' -_ State : FA Mosel : CHI,.s -ic : aG_'?t34 ..:'?J: iM1AA. ?`; : =`.�G: • . -- Stara : Fes. -" 1.744 MAC:M: Trac ' :r L: c : AE•.=914? i/Ns--3�"J•3-AAi"`1..�.Wii. State : FA 1994 7ractor _MQJRJ : Li aJ:— S/N: .'IIAA- '.:;WV . - _= ctstz : FA MACK 7. 7 . . M•:deJ " c . IL • LIC : Aa'=F414 - . .. is NAC a..: LJ.t_A.A. - 7: -- S/N: IM-- AA. _'.ate . RA hACI. _ __ T r-&C zL- S/N: _. ._Nlr_TY _--'_ 'o tate : FA 1� == SFE- -n. Ll?.EF Tra' . pr- _ . _ _ _ AAc., _7.: 1F_LEa _ . .... State: . AL-i Tr a-c:..: rA.:,Ja1 : RWt1=t - • S/N : .. _. . ' -- M„ Ltate : r.A Ts'ac t. -- --- rtoael RW..1 _ Lrc : =y77, _c_ r' iC . . --" model : SWe1 - Lic : :.A807C;5 ( S/N: `M?AYtJ-eY7_MQu��'_f State : FP. _ Equipment inftrr•mat i on '.Me( --------------------------------- - - ------------------------------------------ -- Model FLi: : _ . : 4'oT L: c . AC::4n'17 /N: 1FUYD 'iL::cF'H47 L-i estate : RA FFEIGHTL::aP. - !^.•�•�21 : Fr_D1_054ST LIC : n0.:4� ! --.. E/N:. .lEUYl)ZYB-7FH47_=: : ct3ta 7e 1 5 1993 FREIGHTLINER Trar-tor Model : FLL'_=054ST --- -- LiriA.LG,rl'3-- S/N: 1FUYDSYD73cH•}7. =4i5 State - PA 1:Sa---- 1'i' r=REIGHTLI-NEFa[tat-- Model . FLL :_ r•�3ST Lac : L!YDSYC1FHa'=- ; _ _'tate : FA. ;=REIGHTLiNER T.actor• M„aeI FLD1 Od4ST L i c : AC2e=7,', S/N:-•. 1FUYDS•rC. :FH4'Z.4._::: State : FA • 39 1993 FREIGHTLINER — — - •3�tor- '".�aar •_F1L1 • _4ST r c�AL•:L :•,�: S/N: 1FUYDSYCOPH47 - =t3tg ; ?A 40 1'"" ": FREIGHTL:::Et: Tr Mage ! . FL.1.. .:T - - • '==- - - • SIN: 1FUYDSYC_FH4 :-4 . : '.. 4; 195,: Fn:EIGHTL:`!E!=. -'- ' Lic : . �._ 1•i'y�• Fntl•.]I•'IIL.•.Gr. TY at .. ALL- - 2/N: .:=uYDSYL< FHa . '. 4. .— r •�::^ -=ciuHTLINER _ . Tr 3C tat• _-- Mnyal_: Lac : AD'ir_.i;q • S:'N: :FUI'DSYG-FH47= -.»1 � :3ta . F� =EIG'r�.TL: iEF: -- Modei FLD1=Oc45T '- ic : r — 4'F I E i ::H TL:::EF Tractor Mo4et . Lac : AAc41-_ • 5/N: _FU : =c'rCtrFH4._,, . Lcite : FA Lac : - c_ anTL: — Model : ^FLD120�4ET 'Lic : -.,N: - :FUYDSYrXF'H4'_44f .—. State : FA. _ 4I r.EE'HARLTF.UC1:?:r3 C- Equipment Information (Men,. -------------------------------- -------------- - ---------------- ------------- INT--.NAT, Trncti.r . ..- -- -_ --Mode I : X400 4z;i4 SL-'A Lic : S!ra: _HS State : FA I01�i- -..•TF=:'.;.T: _ _ - Trict • M.)42 Foot r.X4 _-, - L. C . PA 10Z. 1'" ''•: :TERNATIGNAL Tractor -.--. M: tle I :%4G0_ 3 S�_'A —_.— SIN. _::SFHXZFi:LCState : FA NTERNATI'-NAL ---- Tractor_ --_ M.: . _ y4t}0 c/N: _HSFH. _: cLC i7 � _ -•;•its• 1993 FETERBIL- -- -ease : C• leI : TIm ct bl iiJL' Lic : AA4 10S _. N: .:,F5LL'Sr: Wit•:___. ' _. _ State : ?A --' 10 1:%S-0 1N!'!:=.:IAT: _:i:.= - Tr-act': •_ - Model '2400 _: r.. _:-i'c r-u:•:ZR 1-- • - - . . - grate : ---- 7 7 T: _ Tractrir -- . Tr a. llj 1:='•! iNTERNA � . . _ a: = . ill oaa '400 ci;i =E:, /N: =HSFW)ZF - - - - - - li - Stats : INTEFNAT? `SAL -- M'i'72 LIC : A.A44c _H''SFH:._. . _ _ _ . =ell: . 7,Cl iNTE:: .- ^iA:_ --- Trac -1, . rl: •7a1 7•4Lic : AAc,• c__ F'— Tr actot- • =:15FHMCFSLCDII _tate : t "'6 _:ITE=...., S F H.-i,-- - -- - - - - - - Ttate . Fe Tract, M.i4e l 9401.) =3A Lic : S/N: ..H^FHMCR !_ :1 >O .sate : . FA -- 1_/09/ 1993 01 KEPHART TRUCKING CO. Equipment information (Menu- ------------------------------------------•---------------------------------- 7132-007 1981 KF-NWORTH Tractor . Lease : Model : Lies 7') 7132 SIN: E191696 State : PA 7132-009 1979 KENWORTH Tractor ease : Model : Lie: 77 7132 SIN: 1724605 State : ?A -'133-001 1988 PETERBILT Tractor Lease : Model : BOB TROUT Lie: AB03773 7133 SIN : 1XP5DB9X4JN214563 State : PA 134-001 1991 INTERNATIONAL Tractor Lease : Model : JIM BENEDECK Lie : TEMP 7134 SIN: 2HSFHX6R3MC045019 State : FA 135-001 1987 FREIGHTLINER Tractor Lease: Model : JOHN DAVIS Lie: AB39619 7135 SIN: 1FUEYCYBOHH306871 State: PA • 75 Equipment Items listed • 12/09/ 1999 01 KEPHART TRUCKING CO. Equipment Information (Menu- •-----------------------------------------------•-- 7069-005 1993 INTERNATIONAL Tractor Lease : Model : GLENN STOCK Lic: P2G73V 7069 S/N: 2HSFBKZROPCO70007 State : OH 7073-001 1989 PETERBILT Tractor Lease : Model : KEVIN MEYER Lic : AB13190 7073 SIN: 1XP5DB9X4KN269306 State : PA 7083-003 1989 WHITE-GMC Tractor Lease : Model : RON NASO Lic : AB00012 7083 SIN: 4VIWDBCH4KN619266 State: PA 7086-001 1989 WHITE-GMC Tractor Lease : Model : SHED GRAHAM Lic: AB27147 7086 SIN: 4VIWDBJF2KN612138 State : PA 7086-003 1988 INTERNATIONAL Tractor Lease : Model : LANCE DAVIS Lie: AB32438 7086 SIN: IHSRKACRoJH529501 State: PA • 7086-005 1988 FORD Tractor Lease : Model: MIKE MAYS Lic: A836907 7086 SIN: 1FDYA90XSJVA10796 State : PA 7086-007 1989 FREIGHTLINER Tractor Lease : Model : ROD LANCASTER Lic : AB38337 7086 SIN: 2FUYDSYBOKV3495OZ State: PA 7095-001 1969 FREIGHTLINER Tractor Lease : Model : WALT MY ERS Lic : AA76265 7095 SIN: 1FUYDXYBCEH3'960: State : PA 7095-003 1988 INTERNATIONAL Tractor Lease : Model : FRED ST . JOHN Lic : AB28219 7095 SIN: 2HSFBX6R1JC01 =23= State : PA 7097-001 1985 GMC Tractor Lease : Model : DAVE FRANKHOUSER Lic : AB28775 7097 SIN: 1WUYPCJG9FN072:4`_ State : PA 7097-003 1984 KENWORTH Tractor Lease : Model : Lic : AA82837 7097 SIN: :Y.KWD29X9E531523p State : PA 7097-005 1965 :NTERNAT: CNAL Tractor • Lease : Model : JIM JOHNS Lic: AB32882 7097 SIN : 2HSFBJXR9FCA14005 State : PA 7101-001 1985 -REIGHTL ::;ER Tractor Lease : Model : BERNARD FOLMAR Lic : AASS651 7101 SIN: :FUPYSYB6FH268546 State : PA 7105-001 1986 INTERNAT:CNAL Tractor Lease : Model.: OLAN SMITH Lic : AB10998 7105 SIN: 2HSFEGURXJC008623 State: PA 1_/09/1993 Ol KEPHART TRUCKING CO. Equipment Information (Menu- ----------------------------------------------•----------------------------- -.028-001 1988 INTERNATIONAL Tractor Lease : Model : TOM MANEY Lic : AA88109 4028 SIN : 2HSFEX6RXJC014922 State : PA 4087-001 L990 MACK Tractor - Lease : Model : BOB WELLS Lie : AA87923 4087 SIN : LM2AA06YOLWO01600 State : PA Fi032-001 1990 INTERNATIONAL Tractor ' Lease: Model : Lic: AA65568 6032 SIN: 2RSFBX6RiLCO33080 State : PA ')048-001 1990 MACK Tractor Lease: Mode 1 : Lie : AA73999 6048 SIN : 1M2AA14Y5LW006793 State : PA :098-001 1990 FORD Tractor Lease: Model : Lic : AA96704 6098 SIN: 1FDYA90X2LVA04748 State : PA • 1031-001 1989 FORD Tractor Lease : Model : Lic : AA96313 7031 SIN: 1FDYA90X1E:VA30112 State : PA 7032-001 1989 PETERBILT Tractor Lease : Model : MARVIN MYERS Lic : AA96682 7032 SIN: 1XP5DB9XOKN268203 State : PA 7034-002 1988 PETERBILT Tractor Lease - Model : Lic : AA87884 7034 SIN : 1XP5DE9X4�N252147 State : PA 7036-002 1989 FORD Tractor Lease : Model : RICKY BARRE77 Lic : AB21899 7036 SIN : 1FDYA90X9KVA::9791 State : PA 1036-003 1985 FORD Tractor Lease : Model : JACKIE NEFF Lic : AB16467 7036 SIN : 1FDYA90X3FVAC694-- State : PA 1036-006 1988 KENWORTH Tractor Lease : Model : ED SHAW Lic : AB25734 7036 SIN : _Y.KDD29XX:X510379 State : PA 1038-004 1989 ''HIT£-GMC Tractor Lease : Model : DOUG BARTLE:' Lic : AB00:64 7038 SIN : 4VIWDBCH5FN623063 State : PA 7043-001 1969 :-REIGHTLINER Tractor Lease : Model : FRED COBSGN Lic : AB15791 7043 SIN : 1FUYDXYB0KR339986 State : PA 7043-003 1993 FREIGHTL:::ER Tractor Lease : Model : CHARLIE EBERHART Lic : AB30800 7043 SIN: 1FUYDXYB3PH487382 State : PA • 12:09/ 1993 01 KEPHART TRUCKING CG Equipment Information (Menu •--------------------------------------------------------------------------- 298 1989 MACK Tractor Model : RW613 Lic: AA72560 5/N: 1M2AY04Y9KM00571E State : PA 299 1988 MACK Tractor Model : RW613 lic : AA69421 SIN: 1M2AY04Y4JM004006 State : PA 86 Equipment Items listed • 12:09/ 1993 01 KEPHART TRUCKING ( Equipment Information (Me= --------------------------------------------------------------------------- 157 1994 FREIGHTLINER Tractor Model : FLD12064ST Lie: AB24022 SIN : 2FUYDSYBXRA430654 State : PA 158 1994 FREIGHTLINER Tractor Model : FLD12064ST Lic: AB39399 SIN: 2FUYDSYB1RA430655 State : PA 159 1994 FREIGHTLINER Tractor Model : FLD12064ST Lic: AB39397 SIN: 2FUYDSYB3RA430656 State : PA 160 1994 FREIGHTLINER Tractor Model : FLD12064ST Lic: AB39400 SIN: 2FUYDSYB5RA430657 State : PA 161 1994 FREIGHTLINER Tractor Model : FLD12064ST Lic: AB39647 SIN: 2FUYDSYB7RA430658 State: PA • 162 1994 FREIGHTLINER Tractor Model : FLD12064ST Lie: AB39398 SIN : 2FUYDSYB9RA4?0659 State: PA 163 1994 MACK Tractor Model : CH613 Lic: AB39483 SIN : 1M1AA13Y4P.W030721 State : ?A 164 1994 MACK Tractor Model : CH613 Lic : AB39148 SIN : 1M1AA13Y4 ;:.WO30722 State : PA 165 1994 MACK Tractor Model : CH613 Lic : AB39484 SIN : 1M1AA13YEP.W03072= State : PA 166 1994 MACK Tractor Model : CH613 Lic : AB3?149 SIN : 1MIAA13YXP;�030724 State : PA 167 1994 MACK Tractor Model : Lic : SIN : 1M1AA13YInW030725 State : PA 166 1994 MACK Tractor Model : Lic : 5/N : 1M1AA13Y3EW030726 State : PA 201 1990 MACK Tractcr Model : CH613 Lic : AA94973 SIN : 1M2AA06YX.L'�;001183 State : PA 202 1988 MACK Tractor Model: R Lic: AB18818 SIN : 1M2N167Y4JWO22574 State: PA 12/09/ 1993 01 KEPHART TRUCKING CC Equipment Information !Ment ------------------------------------------------- 128 1991 INTERNATIONAL Tractor Model : 9400 6X4 SBA Lie : AB31622 SIN: 2HSFHMCR3MC046383 State : PA 129 1991 INTERNATIONAL Tractor Model : 9400 6X4 SBA Lie : AB04053 SIN: 2HSFHMCROMC04b387 State : PA 130 1991 WHITE—GMC Tractor Model : WCA64T (NO SLEEPER) Lie : AB00977 SIN: 4V2VDBCE?MN639962 State : PA 131 1992 MACK Tractor Model : CH613 Lie : AB00849 SIN : 1M2AA13Y4NW013607 State : PA 132 1993 FREIGHTLINER Tractor Model : FLD12064ST Lie : AB24916 SIN: 1FUYDSYB5PH472434 State : PA • 133 1993 FREIGHTLINER Tractor Model : FLD12064ST Lie: AB24917 SIN: 1FUYDSYBXPH472431 State : PA 134 1993 FREIGHTLINER Tractor Model : FLD12064ST Lic : AB24918 SIN: 1FUYDSYB2FH47-43: State : PA 135 1993 FREIGHTLINER Tractor Model : FLD120645T Lic : AB24919 SIN: 1FUYDSYB7?H47:435 State : PA 136 1993 FP.EIGHTLINER Tractor Model : FLD12064ST Lic : AB2020 SIN: 1FUYDSYB1PH472432 State : PA 138 1993 FREIGHTLINER Tractor Model : FLD12064ST Lic : A82c359 SIN : lFUYDSYB9P447--436 State : PA 139 1993 FREIGHTLINER Tractor Model : FLD12064ST Lic : AB26360 SIN : 1FUYD5YB0PH472437 State : PA I . 140 1993 FREIGHTLI:)ER Tractor Model : FLD12064ST Lic : AB26361 SIN: 1FUYDSYB2PH472433 State : PA 141 1993 FREIGHTLINER Tractor Model : FLD12064ST Lic : AB26362 SIN : 1FUYDSYB4FH472439 State : PA 142 1993 FREIGHTLINER Tractor Model : FLD12064ST Lic : AB26363 State : PA 12/09/ 1993 01 KEPHART TRUCKING C: Equipment Information (Men --------------------------------------------------------------------------- 100 1989 FREIGHTLINER Tractor Model : Lic : AA80142 SIN: 1FUYDRYB4KH353937 State : PA 101 1989 FREIGHTLINER Tractor Model : Lic : AA80143 SIN: 1FUYDRYB6KH35-936 State : FA 102 1989 FREIGHTLINER Tractor / Model : Lic : AA80144 SIN: IFUYDRYBBKH353939 State : PA 103 1989 WHITE-GMC Tractor Model : WIA64T Lic : AA86388 SIN: 4V2WDBCEOKN6=2201 State : PA 104 1989 FREIGHTLINER Tractor Model : GLIDER Lic: AA80140 SIN: IFVBDOY90KH365846 State : PA • 105 1990 INTERNATIONAL Tractor Model : 9400 6X4 SBA Lic : AA91110 SIN: 2HSFHXZR4LC0_6100 State : PA 106 1990 INTERNATIONAL Tractor Model : 9400 6X4 SBA Lie : AB06009 SIN: 2HSFHXZRBLCO36102 State : PA 107 1990 INTERNATIONAL Tractor Model : 9400 6X4 SBA Lic : AA91112 SIN: ZHSFHXZRBLCO'6097 State : PA 108 1990 INTERNATIONAL Tractor Model : 9400 6X4 SBA Lic : AA91113 SIN: ZHSFHXZRXLC036096 State : FA 109 1990. INTERNATIONAL Tractor Model : 9400 6X4 SBA Lic : AA91114 SIN : ZHSFHXZR6LCD'_'609c State : PA 110 1990 INTERNATICNAL Tractor Model : 9400 6X4 SBA Lic : AA91115 SIN: ZNSFHXZRILC0-6104 State : ?A 111 1990 INTEP.NATICNAL Tractor Model : 9400 6X4 SBA Lic : AB02204 SIN: ZHSFHXZRlLCO36099 State : FA 112 1990 1NTERNATiCNAL Tractor Model : 9400 6X4 SBA Lic : AB34493 SIN : 2HSFHXZRXLCO36103 State : ?A 113 1990 INTERNATIONAL Tractor Model : 9400 6X4 SBA Lic : AA44675 c/". iu4Cuv7PIT, 3 ;105 State : PA • INFORMATION SCHEDULE I Town of Southold Bid Project C&D Haul-Disposal Services The Bidder hereby states that it will be prepared to dispose of up to the following Maximum Specified Yearly Capacities in tons of Town of Southold construction material and/or demolition debris if awarded an Agreement. Contract Year Maximum Tons per Contract Year 1997-1998 5,000 5,000 1998-1999 5,000 1999-2000 2000-2001 5,000 • 2001-2002 S,Onn WM of New York, Inc. DBA Name of Bidder. Waste Management of New York B Date: May 22 1997 y �- Maximum Specified Capacity Schedule 5.0. 1 • BID (PROPOSAL) FORM INFORMATION SCHEDULE J Town of Southold Bid Project C&D Haul-Disposal Services NOTE: IF A BIDDER INTENDS TO UTILIZE MORE THAN ONE DISPOSAL SITE, AN INFORMATION SCHEDULE J MUST BE COMPLETED FOR EACH DISPOSAL SITE . The following is information on the undersigned Bidder 's Disposal Site: I . GENERAL A . Disposal Site Location Wit f New York In DBA Name : I"1as�e New o€-New York, Inc. • Address: _ 123 Varick Avenue Brooklyn NY 11237 Phone: ( 718 ) 533-5314 B . Disposal Site mailing address Cif different than I ) Address: Same i i II . CURRENT OPERATIONS A . Operations Permit 1 . Permittee: ��tN3v�c -- 2 . No . : 2-610-00013/00001 -0 3 . State: New York `t . Date of Issue: October 30, 1996 i S . Date of Expiration: October 30, 2001 6 . Copy Enclosed: Yes: x No: Bidder Disposal SiteCs) Schedule S .O .J BID (PROPOSAL) FORM Page 1 of 7 INFORMATION SCHEDULE J - (Continued) B . Hours of Operations 1 . What are the PERMITTED operating hours? DAV A .M . P .M . Monday 24 Hrs to Tuesday 24 Hrs to Wednesday 24 Hrs to Thursday 24 Hrs to Friday 24 Hrs to Saturday 94 ff - to Sunday to 6 O( Open 2 . Are there any PERMITTED closure periods stipulated? NO What are the ACTUAL operating hours? SAME AS ABOVE DAY A .M . P .M . Monday to Tuesday to Wednesday to Thursday to Friday to Saturday to { Sunday to 1 } , What holiday or other period is the -➢isposal Site typically closed? DAY YES NO NeW Year 's X to Memorial X _ to Independence X to Labor X to Thanksgiving X to Christmas r to Other (Specify) to Bidder Disposal Site(s) Schedule S .O .J Page 2 of 7 BID (PROPOSAL) FORM 1i 1 • INFORMATION SCHEDULE J - (continued) 5 , Will the ACTUAL operating hours in Question II .B .3 be extended up to the PERMITTED operating hours in Question II .B .1 in order to accommodate Town of Southold construction material and/or demolition debris? Yes No XX Not Needed i S . Are there_ anu local agreements, ordinances, etc . which would prohibit extending the ACTUAL operating hours in Question II .B .3 up to the PERMITTED operating hours in Question II .B . l .? Yes No X C . What is the PERMITTED annual capacity in cubic yards? 1998 2, 250,000 1999 2,250,000 2000 2.250,000 2001 2, 250,000 2002 2. 250,000 D . At the PERMITTED levels in Question II .C . , what is the projected useful life in years? N/A 1 E . What is the annual RECEIVING level today? 1,800.000 _ 1 1 Bidder Disposal Sites) Schedule S .O .J BID (PROPOSAL) FORMS Page 3 of 7 j IN70RMATION SCHEDULE J - (Continued) i F . At the RECEIVING levels in Question II .E . , what is the j projected useful life in years? N/A G . How much of the RECEIVING level in Question II . E . is committed to under contract in cubic yards? 1998 None 1999 None 2000 None 2001 None 2002 None • H . Does the Disposal Site have special waste restrictions For: Gate Yes No Fee C$) 1 . Asbestos 2 . Wastewater Treatment Sludge 3 . Hazardous Waste • Bidder Disposal Site(s) Schedule S .O .J BID (PROPOSAL) FORM Page It of 7 INFORMATION SCHEDULE J - (Continued) I . Are there any existing Agreements with local municipalities which prohibit: Item Yes No 1 . Routing to site g. 2 . Weight limits between R state roads and site 3 . Number of vehicles x-- S. Vehicle size x-- 5 . C&D importation x outside ,jurisdictional area 6 . Host Community Benefits B • III . EXPANSION PLANS N/A A . Application Permit 1 . Permittee: 2 . No . : 3 . State:' Lf . Date of Submission: 5 . Copy Enclosed: Yes _ No 6 . Submission Status: a . Expansion of current site or new site N/A b . Local Citizenry reaction_ N/A C . Regulatory agency N/A Bidder Disposal Site(s) Schedule 5 .0 .J BID (PROPOSAL) FORM Page 5 of 7 1 INFORMATION SCHEDULE J - (Continued) d . Litigation N/A e . Likelihood to succeed N/A B . IF you are successful in Question III .A . , what is the additional annual DESIGN capacity in cubic yards (do not include figures From Question iI .C . )? 1998 N/A 1999 2000 2001 2002 • C wooannual alevels uldbetheprojecteduQuestion seful lifeinyears?II B what N/A D . Would you be willing to share with the Town of Southold engineering reports utilized For the preparation of the Operating Permits on Expansion Application? Yes No _ E . Bidder 's Disposal Sites) Engineer of Record Firm 's Name Galli Engineering Firm' s Address 734 Walt Whi}- __ n^�a Melville NY Project Engineer Rich Galli • Sche,dule S .O . J Bidder Disposal Site(s) page 5 of 7 BID (PROPOSAL) FORM INFORMATION SCHEDULE J - (Continued) IV . ATTACHMENTS Attach copies of all permits required of the disposal site(s) and a copy of the agreement, performance bond and insurance between bidder and permit holder to use the disposal site(s) during the term of this Agreement. Are you willing to meet with the Town of Southold to discuss your short and long term disposal capabilities? Yes_X_No The undersigned hereby certifies that services, material , or equipment to be furnished as a result of this bid will be in Full accordance with Town of Southold specifications applying thereto unless exceptions are indicated above and an explanation attached . �TM �f blew York, I.nj. . DBA Bidding Company as a anaaement o New York Address 123 Varick Avenue Brooklyn NY 11237 • City State Zip By Charles Gusmano Director, Business Development (Please Print�qpe) NAME AND TITLE Signature ( / Phone No . 718-533-5314 Date May 22,1997 CORPORATE SEAL Bidder Di Doeal Site(s) Schedule 5 .O .J BIC (PROPOSAL) FORM Page 7 of 7 • New York State Department of Environmental Conservation _ • Division of Compliance Services, Region 2 Office 47-40 21st Street, Long Island City, NY 11101 Tel: (718) 482-4997 Fax: (7181482.4975 30 October 1996 _ Richard D. Galli, P. E. Galli Engineering, P. C. 734 Walt Whitman Road Melville, NY 11747 Re: DEC Permit No. 2-6104-00013/00001-0 Waste Management of New York, 123 Varick Ave., Brooklyn, NY 11237 ECL Artice 27 -- Solid Waste Management NOTICE OF PERMIT RENEWAL Dear Mr. Galli: Enclosed is your client's permit. Please have your client read all conditions carefully. Please provide a full copy of this permit to all agents, contractors, and employees performing • any part of the permitted activities. If you have any technical questions regarding this permit, please call Anthony Masters, of the DEC Region 2 Division of Solid and Hazardous Materials at (718) 482-4996; procedural or environmental review questions should be directed to John Cryan of my staff at the number above. Vers, �� John J. Ferguson Regional Permit Administrator cc: A. Masters, DEC Region 2 Div. of Solid & Hazardous Materials Capt. L. Kelly, DEC Region 2 Division of Law Enforcement • encl. JJF/JFC:bh (WP60/PERMrr.LET) • NEW YORK STATE DEPARTMENT OF CONSERVATION DEC PERMIT NUMBER: EFFECTIVE DATE: 2.6104-00013/00001-0 :30 October 1996 FACILITY/PROGRAM NUMBER(S): PERMIT EXPIRATION DATE(S): 24W89 :30 October 2001 Under the Environmental Conservation Law (ECL) CTYPE OF PERMIT: ❑ New X Renewal X Modification X Permit to Construct X Permit to Operate ❑ Article 15, Title 5: Protection ❑ 6 NYCRR 608: Water Quality X Article 27,Title 7; 6 NYCRR 360: of Waters Certification Solid Waste Management ❑ Article 15,Title 15: Water ❑ Article 17, Titles 7, 8: SPDES ❑ Article 27, Title 9; 6 NYCRR 373: Supply Hazardous Waste Management ❑ Article 19: Air Pollution ❑ Article 15, Title 15: Water Control ❑ Article 34: Coastal Erosion Transport Management ❑ Article 24: Freshwater Wetlands ❑ Article 15,Title 15: Long ❑ Article 36: Floodplain Island Wells ❑ Article 25: Tidal Wetlands Management PERMIT ISSUED TO: Waste Management of New York, Inc. TELEPHONE NUMBER: (718) 386 -7900 ADDRESS OF PERMITTEE: 123 Varick Avenue, Brooklyn, NY 11237 CONTACT PERSON FOR PERMITTED WORK: Richard D. Galli, P. E. TELEPHONE NUMBER: Galli Engineering, P. C., 734 Walt Whitman Road, Suite 402A, Melville, NY 11747 (516) 271 - 9292 PROJECTJFACILITY NAME: Waste Mgmt. of NY Solid Waste Transfer Station and Recyclables Handling and Recovery Facility PROJECT/FACILITY ADDRESS: 123 Varick Avenue, Brooklyn, NY 11237 COUNTY: Kings TOWN: New York City WATER BODY: None NYTM COORDINATES: 590.5 East; 4507.2 North DESCRIPTION OF AUTHORIZED ACTIVITY: Construction and operation of a solid waste transfer station and recyclables handling and recovery facility with a maximum allowed total solid waste throughput of 7,499 cubic yards per day, consisting of a maximum of 500 cubic yards per day of putrescible solid waste and 6,999 cubic yards per day of construction and demolition debris. By acceptance of this permit, the permittee agrees that the permit is contingent upon strict compliance with the ECL, all applicable regulations, the General Conditions specified (see page 2) and any Special Conditions included as part of this permit. REGIONAL PERMIT ADMINISTRATOR: ADDRESS: NYS DEC Region 2 Office, 47-40 21st Street • .John J. Ferguson Long Island City, NY 11101 PHONE: (718) 482-4997 L4,0LUTHORIZE14 SIGNATU DATE: 30 October 1996 Page 1 of 5 GENERAL CONDITIONS Instructions 1. The permitted site or facility, including relevant records, is subject to inspection at reasonable hours and intervals by authorized representatives of the Department of Environmental Conservation (the Department) to determine whether the Permittee is complying with the instant permit and the ECL. Such representatives may order the work suspended pursuant to ECL 71-0301 and SAPA 401(3). A copy of the instant permit,any and all amendments thereto, and any and all documents referenced in such permit or amendments, must be available for inspection by the Department alt all times at the project site. Failure to produce a copy of such permit, such amendments, or such referenced documents upon request by a Department representative is a violation of this permit. Any permit sign provided by the Department shall be displayed in a visible facility location and protected from the elements for the life of this permit. Permit Changes and Renewals 2. The Department reserves the right to modify, suspend, or revoke this permit when-- a) the scope of the permitted activity is exceeded or a violation of any condition of the permit or provisions of the ECL and pertinent regulations is found; b) the permit was obtained by misrepresentation or failure to disclose relevant facts; c) new material information is discovered; or d) environmental conditions, relevant technology, or applicable law or regulation have materially changed since the permit was issued. 3. All work authorized herein shall comply with the most current information submitted by the Permittee pursuant to its application for the instant permit. If such information conflicts with any provision of the instant permit, such provision shall obtain. The Permittee must submit a separate written application to the Department for renewal, modification, or transfer of this permit. Such application must include any forms,fees,or supplemental information the Department requires. Any renewal, modification, or transfer granted by the Department must be in writing. 4. The permittee must submit a renewal application at least-- a) 180 days before expiration of permits for State Pollutant Discharge Elimination System (SPDES), Hazardous Waste Management Facilities (HWMF'), major Air Pollution Control (APC), and Solid Waste Management Facilities (SWMF); and b) 30 days before expiration of all other permit types. 5. Unless expressly provided for by the Department, issuance of this (permit does not modify, supersede, or rescind any order or determination previously issued by the Department or any of the terms, conditions, or requirements contained in such order or determination. Other Legal Obligations of Permittee 6. The Permittee has accepted expressly, by the execution of its application for the instant permit, the full legal responsibility for all damages, direct or indirect, of whatever nature and by whomever suffered, arising out of the project described in this permit and has agreed to indemnify and save harmless the State from suits, actions, damages, and costs of every name and description resulting from this project. 7. This permit does not convey to the Permittee any right to trespass upon the lands or interfere with the riparian rights of others in order to perform the permitted work nor does it authorize the impairment of • any rights, title, or interest in real or personal property held or vested in a person not a party to the permit. 8. The Permittee is responsible for obtaining any other permits, approvals, lands, easements, and rights-of- way that may be required for this project. Permit No. 2-6104-00013/00001-0 Page 2 of 5 ADDITIONAL GENERAL CONDITIONS FOR ARTICLES 15(TITLE 51,24,25,34,36 AND 6NYCRR PART 608 That if future operations by the State of New York require an 12. All necessary precautions shall be taken to alteration in the position of the structure or work herein preclude contamination of any wetland or waterway by authorized,or if,in the opinion of the Department of Environmen- suspended solids,sediments, fuels,solvents, lubricants, epoxy tal Conservation it shall cause unreasonable obstruction to the coatings,paints,concrete,leachate or any other environmentally free navigation of said waters or flood flows or endanger the deleterious materials associated with the project. health,safety or welfare of the people of the State,or cause loss 13. Any material dredged in the prosecution of the work herein or destruction of the natural resources of the State, the owner permitted shall be removed evenly, without leaving large refuse may be ordered by the Department to remove or atter the piles,ridges across the bed of a waterway or floodplain or deep structural work,obstructions,or hazards caused thereby without holes that may have a tendency to cause damage to navigable expense to the State,and if,upon the expiration or revocation of channels or to 4he banks of a waterway. this permit,the structure,fill, excavation, or other modification 14. There shall be no unreasonable interference with navigation by of the watercourse hereby authorized shall not be completed,the the work herein authorized. owners,shall,without expense to the State,and to such extent 15. If upon the expiration or revocation of this permit, the project and in such time and manner as the Department of Environmen- hereby authorized has not been completed, the applicant shall, tal Conservation may require, remove all or any portion of the without expense to the State, and to such extent and in such uncompleted structure or fill and restore to its former condition time and manner as the Department of Environmental Conserva- the navigable and flood capacity of the watercourse. No claim tion may require,remove all or any portion of the uncompleted shall be made against the State of New York on account of any structure or fill and restore the site to its former condition. No such removal or alteration. claim shall be made against the State of New York on account 10. That the State of New York shall in no case be liable for any of any such removal or alteration. damage or injury to the structure or work herein authorized 16. If granted under Article 36, this permit does not signify in any which may be caused by or result from future operations way that the project will be free from flooding. undertaken by the State for the conservation or improvement of 17. If granted under 6NYCRR Part 608, the NYS Department of navigation, or for other purposes, and no claim or right to Environmental Conservation hereby certifies that the subject compensation shall accrue from any such damage. project will not contravene effluent limitations or other limitations 11. Granting of this permit does not relieve the applicant of the or standards under Sections 301,302, 303,306 and 307 of the responsibility of obtaining any other permission, consent or Clean Water Act of 1977 IPL 95-217) provided that all of the approval from the U.S. Army Corps of Engineers, U.S. Coast conditions listed herein are met. • Guard, New York State Office of General Services or local 18. All activities authorized by this permit must be in strict government which may be required. conformance with the approved plans submitted by the applicant or his agent as part of the permit application. Such approved plans were prepared by (see Special Condition No. 2 on Pane 4) on SPECIAL CONDITIONS Please see the numbered Special Conditions on the following page. SPECIAL NOTE: In accordance with Title 19, Part 600.4 (c) of the New York Code of Rules and Regulations, the New York State Department of Environmental Conservation hereby certifies that the action described and approved in this permit, if located within the Coastal Zone, is consistent to the maximum extent practicable with the policies and purposes of the New York City Waterfront Revitalization Program. • cEc PERMrr NUMBER: Continued on next page... 2-6104-00013/00001-0 YEnMmfEF- 123 Varick Avenue, Brooklyn NY 11237 Waste Management of New York Page 3 of 5 NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION SPECIAL CONDITIONS 1. All work and activities authorized by this permit shall comply with all of the applicable provisions of 6 NYCRR Part 360 (Solid Waste Management Regulations), especially Subparts 360-1, 360-11, and 360-12, unless otherwise specified herein. 2. All construction and operation activities authorized by this permit shall be in strict conformance with the application materials submitted to DEC by the permittee in support of this application, including the following: a. An engineering report, appendices, and operations and maintenance: manual (4 bound volumes), prepared for Waste Management of New York by Richard D. Galli, P. E., dated 7/30/96. b. An 8-sheet set of facility site plans prepared for Waste Management of New York, signed and stamped by Richard D. Galli, P. E., dated 7/30/96. 3. Within ten (10) days after the completion of any construction authorized by this permit, permittee shall have a professional engineer licensed by the State of New York submit to DEC Regional Solid and Hazardous Materials Engineer certification that the subject facility is constructed in conformance with the site plan described in Special Condition No. 2 (b) above. Permittee shall not operate the facility under the terms of this permit until after DEC has received the facility engineer's certification of completion of construction, and until alter permittee receives written confirmation from DEC that DEC deems the construction to be complete and in accord with the facility plan. This condition does not apply if no new construction will be done at the facility by permittee. 4. If it has not yet done so, permittee shall, within thirty (30) days after the effective date of this permit, submit to DEC an irrevocable bank letter of credit in the amount of $50,000, or a performance bond in the amount of $100,000, guaranteeing permittee's compliance with the terms and conditions of this permit, and guaranteeing compliance with the Environmental Conservation Law of the State of New York. Said letter of credit or performance bond shall be in the form attached to this permit. Permittee shall keep its letter of credit or performance bond in effect for the duration of its operation of the facility,. until DEC accepts permittee's engineer's statement of facility closure under the terms of 6 NYCRR Part 360. 5. Solid waste which is not recycled shall be sent only to the approved solid waste disposal facilities documented in the application with letters of intent and all currently required, valid permits to operate. At least three months prior to the expiration of any permit required to operate any of the disposal facilities described above, permittee shall submit a complete copy of the renewed permit or permit extension to the Regional Solid and Hazardous Materials Engineer at the Region 2 Office of DEC. If permittee fails to submit such copy, or if any disposal facility loses any governmental authorization required to operate any of the disposal facilities named above for any reason, including expiration and failure to renew permits, permit suspension, permit revocation, or facility closure, cessation of operations, or abandonment, permittee shall immediately cease sending solid waste to such facility or facilities for disposal, and shall notify the DEC Region 2 Solid and Hazardous Materials Engineer of such cessation and the reason(s) for it. If permittee wishes to add or otherwise change the disposal facilities to which permittee is authorized to send solid waste, permittee shall submit letters of intent from such disposal facilities, and copies of all required permits to operate such disposal facilities, to the DEC Region 2 Solid and Hazardous Materials Engineer. Upon written authorization from the DEC Region 2 Solid and Hazardous Materials Engineer, permittee may send solid waste to such disposal facilities. DEC PERMIT NUMBER: 2-6104-00013/00001-0 PERMITTEE: Waste Management of New York Page 4 of 5 FACILITY: 123 Varick Av BKN NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVA'r10N SPECIAL CONDITIONS 6. The account to fund the environmental monitorls) as established under a previous version of this permit shall continue as follows: a. The sum of $10,000 shall be maintained with the Department for funding of environmental compliance activities related to the operation of the facility herein permitted. This sum is based on annual monitor program costs and is subject to quarterly revision. Subsequent quarterly payments shall be made for the duration of this permit to maintain an account balance sufficient to meet the next nine months' anticipated expenses. Quarterly payments shall be made for the duration of this permit in accordance with the following provisions. b. Costs to be covered by this fund include: i) Direct personal service costs and fringe benefits of the environmental monitor(s) and full-time monitor supervisor(s), including the costs of replacement personnel for the person(sl regularly assigned to these positions; ill Direct non-personal service costs, including without being limited to purchase or lease of a vehicle if necessary and its full operating costs, and any appropriate chemical sampling and analysis; iii) Inflation increases and negotiated salary increases; and iv) Indirect support or overhead costs at the NYS DEC Federally-approved Indirect Cost Rate. C. Upon written request by permittee, the Department shall make available to permittee any records (e. g., vouchers, time records) relating to such monitor costs, consistent with applicable law. d. As noted, the Department may revise the required payment on a quarterly basis to include all costs of monitoring to the Department. The quarterly revision may take into account factors such as inflation, salary increases, accrued interest to be applied to the balance, changes in operating hours and procedures, and the need for additional on-site monitors and supervision of such monitors by fullktime monitor supervisors. Upon written request by the permittee, the Department shall provide permittee with a written explanation for the basis of any modification. e. Within 30 days of written notice by the Department that a payment is due, payment shall be forwarded to the Department. Payment should be sent to: NYS Department of Environmental Conservation, 50 Wolf Road, Room 593, Albany, NY 12233-1510, Attention: Director of Environmental Monitors. Payments shall be in advance of the period in which they will be expanded. f. Upon termination (expiration without renewal, revocation, or transfer) of this permit and payment of any outstanding costs, the unexpended balance including interest will be returned to the permittee. g. Failure to make the required payments is a violation of this permit. The Department may take appropriate action to enforce the payment provisions, including suspension or revocation of the permit. h. The environmental monitor shall, when present at the permitted site, abide by all of permittee's health and safety and operational requirements and policies; provided, however, that this subparagraph shall not be construed as limiting the monitor's powers as otherwise provided for by law and shall not result in the monitor's being less protected than the monitor would be if he or she were to abide by state and federal health and safety requirements. i. The permittee shall furnish to the environmental monitors a current site policy and procedures manual For health and safety issues. Within ten (10) days of any revision to the health and safety plan, the permittee shall notify DEC, in writing, of such modification. • DEC PERMIT NUMBER: 2-6104-00013/00001-0 PERMITTEE: Waste Management of New York Page 5 of 5 SITE: 123 Varick AV, BKN *Galli engineering, P.C. November 1, 1996 Mr. Anthony Cucinotta Waste Management of New York A Division of New York Acquisition Sub, Inc. 123 Varick Avenue Brooklyn, NY 11237 Re: Part 360 Permit Dear Mr. Cucinotta: Enclosed is the original of your Part 360 permit for 123 Varick Ave. Please review the permit conditions at your earliest convenience. If any questions should arise • or additional information is required, please feel free to contact me. GALLI ENGINEERING, P.C. Ken Brooks, P.E. Project Manager c: File • 734 Welt Whitman Road • Suite 402A • Melville NY 11747 • 516-27'1-9292 • F" 516-271-9345 95-20-1 (81"-9d New York State Department of Environmental Conservation � NOTICE v The Department of Environmental Conservation (DEC) has issued permit(s) pursuant to the Environmental Conservation Law for work being conducted at this site. For further information regarding the nature and extent of work approved and any Departmerital conditions on it, contact the Regional Permit Administrator listed below. Please refer to the permit number shown when contacting the DEC. 4eional ermit A ministrator �� 1Oy OOO t/i/00001 -00Regulatory Affairs Permit Number 7Hunters Point Plaza 47-40 21 st street Long Island City,NY 71101 Expiration Date 30 0cT06E'K 2001 NOTE: This notice is NOT a permit JF%,k. . = . 1 z nitation PERMIT AND INSPECTION UNIT sa 137 Center Street, Room 104 T45 : New York,NewewY York 10013 P: Telephone (212) 219-5040 Date of Issuance - August 19 , 1996 NON-PUTRESCIBLE SOLID WASTE TRANSFER STATION PERMIT Transfer Station Number: 139 Address : Waste Management of New York A division of WM of New York, Inc . 123 Varick Avenue Brooklyn, New York 11237 Block # 2974 Lot # 51 From: 3/26/96 To: 12/31/96 The above referenced location is to be used only for the reception and deposition of non-putrescible solid waste material . • Such waste material is to be removed from the transfer station for final disposition within 48 hours . This permit is further subject to the following conditions : (1) The height of the non-putrescible solid waste pile (s) must not exceed 8 feet ; (2) A 10 foot opaque fence must enclose the site on all sides of the property; (3 ) The volume of non-putrescible solid waste stored on Block 2974 , Lot 51 shall not exceed 5, 000 cubic yards ; (4) The % olume of non-putrescible solid waste stored in the two areas in the west-central portion of Block 2968 , Lot 1 shall not exceed 5, 000 cubic yards . (The storage of non-putrescible solid waste at Block 2968 , Lot 1 shall be in accordance with the drawing submitted by Donald Levy on 4/26/95) • Page 1 of 3 ;NEEP NYC CLEAN - RED[.CE. REUSE. RECWLE DON'T LITTER panted on recycled paper (5) A working water supply must be within access of all sections of the pile (s) ; (6) Dust created by the dumping and transferring of non- putrescible solid waste must be kept under control ; (7) Only non-putrescible solid waste can be dumped at your transfer station site as defined by the Department ' s rules and regulations; (8) A daily record shall be kept showing what non-putrescible solid waste is brought into the site by cubic yards , where it came from, and where it was ultimately disposed of by cubic yards ; (9) Non-putrescible solid waste may be deposited only in the depository area initially outlined for this purpose on the survey map; • (10) This permit should be prominently displayed at the transfer station site and available for review by Department inspectors at all times . (11) This permit is conditioned upon compliance by the permittee with any and all rules and regulations of the Department of Sanitation in existence on the date of this permit ' s issuance, and any operating rules amended or promulgated during its term. You are hereby advised that the renewal of this permit may be conditioned upon compliance with rules concerning the siting of transfer stations to be promulgated by the Department pursuant to Local Law 40 of 1990 . (12) This permit is issued upon the condition that the permittee shall comply with the Federal, State, and Local Laws, Regulations and Rules governing the installation of a :system for the sanitary disposal of storm water, sewage and waste water, and the discharge of storm water, sewage and waste water. The permittee shall have until September 18, 1996 to install a system complying with such Laws , Regulations and Rules , and to secure all licenses and permits required by such Laws , Regulations and Rules . if, for any reason, the permittee fails to comply with. this condition, this permit shall , upon written notice to the permittee, be revoked . Page 2 of 3 (13) This permit is issued upon the condition that the permittee shall submit a certified copy of a deed as recorded in the Office of the City Register as soon as it is available . If, for any reason, the permittee fails to comply with this condition, this permit shall , upon written notice to the permittee, be revoked. All operations at these premises and the use thereof shall be in conformity with all applicable federal, state and local laws, and the rules and regulations of any governmental agency having jurisdiction over these premises or the use thereof; and in accordance with any statements contained in your application. SPECIAL NOTE: THIS PERMIT IS BASED UPON THE CONDITION SUBSEQUENT THAT THE HOLDER OBTAIN RENEWALS OF ALL REQUIRED PERMITS AND SUBMIT COPIES OF THOSE RENEWED PERMITS TO THE PERMIT & INSPECTION UNIT, DEPARTMENT OF SANITATION. THE DEPARTMENT' S PERMIT SHALL BE SUSPENDED IF THE HOLDER SHALL FAIL TO RENEW ANY AND ALL REQUIRED PERMITS AND PROMPTLY SEND COPIES OF THOSE RENEWED PERMITS TO THE PERMIT & INSPECTION UNIT. FAILURE TO COMPLY WITH THE ABOVE NOTED RULES SHALL ALSO RESULT IN SUSPENSION. THIS PERMIT IS SUBJECT TO REVOCATION IF THE PERMITEE IS FOUND TO BE UNFIT BY THE TRADE WASTE COMMISSION, DEPARTMENT OF INVESTIGATION OR ANY OTHER REGULATORY AGENCY WITH JURISDICTION OVER THE PERMITEE. t S� Thomas Milora i • INFORMATION SCHEDULE J Town of Southold Bid Project C&D Haul-Disposal Services NOTE: IF A BIDDER INTENDS TO UTILIZE MORE THAN ONE DISPOSAL SITE, AN INFORMATION SCHEDULE J MUST BE COMPLETED FOR EACH DISPOSAL SITE. The following is information on the undersigned Bidder's Disposal Site: I . GENERAL A. Disposal Site Location Name: MODERN LANDFILL & RECYCLING Address: RD M 9, BOX 317 • YORK, PA 17402 Phone: 717-246-2686 B . Disposal Site mailing address (If di:ferent than I ) Address: II . CURRENT OPERATIONS A . Operations Permit 1 . Permittee : PA DEP — 2 . No . : 100113 _ . State: PA 4 . Date cf Issue: S . Cate of Expiration : _ • 6 . Copy Enclosed: Yss: X No: Bidder Clsposal Sits(s) Schedule S .O .J BID ( PROPOSAL) FORM Page 1 cf 7 INFORMATION SCHEDULE J - (Concinued) 8 . Hours of Operations 1 . What are the PERMITTED operating hours? DAY A .M . P .M . Monday 6.00 to 6:00 Tuesday 6.00 to i-- Wednesday — t0 6:00 Thursday 6•no to 6:II(1— Friday 6.00 to 1.00 Saturday 6.00 to 1:00 am Sunday Closed to rin_�pa 2 . Are there any PERMITTED closure periods stipulated? • _ , What are the ACTUAL operating hours? DAY A.M . P .M . Monday 6:00 1:0 4-on Tuesday 6:00 1:0 4:nn Wednesday 6:00 a 4199-- Thursday 6:00 to 4:00 Friday 6:00 to 4:00 _ Saturday 6:00 t on 10:22- am Sunday Closed to rin�=d u What holiday or other period is the -Disposal Site typically closed? DAY vv=G NO New Year ' s to Memorial x to Independence X to Labor R to Thanksgiving X to Christmas R to Other (Speci.'y) to x • Bidder Disposal Site(s) Schedule S .O .J BID ( PROPOSAL) FORM Page 2 of 7 INFORMATION SCHEDULE J - (continued) S . Will the ACTUAL operating hours in Question II .B .3 be extended up to the PERMITTED operating hours in Question II .B . 1 in order to accommodate Town of Southold construction material and/or demolition debris? Yes No X 6 . Are there any local agreements, ordinances, etc . which would prohibit extending the ACTUAL operating hours in Question II .B.3 up to the PERMITTED operating hours in Question II .B . 1 .? Yes No X C . What is the PERMITTED annual capacity in cubic yards? 1998 1,500,000 Tons Pending Permit 1999 2000 Pending Permit • 2001 Pending Permit 2002 Pending Permit At the p7RMI:7ED levels in Question ! I -C- , what is the projected useful life in years"' 1, 5 years in current disposal_ area. 7 years pending Northsastn54*pan9:iaw permit What is the annual RECEIVING '_evel today? 3560 itn a�vm • Bidder Disposal Slte(s) Schedule S .O .J BID : PROPOSAL) FORMS Page 3 of 7 INFORMATION SCHEDULE J - (Continued.) F At the RECEIVING levels in Question II .E. , what is the projected useful life in years? 1.5 Years in current area 13-17 Years pending Northwest expansion G. How much of the RECEIVING level in Question II .E. is committed to under contract in cubic yards? 1998 3, 600 Tons 1999 960 Tons 2000 2001 ----- --- 2002 ----- --- • H Does the Disposal Site have special waste restrictions For: Gate Yes No Fee (S) 1 . Asbestos X 35 YARD X 35 TON F- . Wastewater Treatment _ Sludge Hazardous Waste x -- --- Bidder Disposal Site(s) Schedule S . O .J BID (?ROPOSAL) FORM Page u of 7 INFORMATION SCHEDULE J - (Continued) I . Are there any existing Agreements with local municipalities which prohibit: item Yes No 1 . Routing to site 2. Weight limits between __ X state roads and site 3. Number of vehicles __ X It. Vehicle size X S . C&D importation X outside ,jurisdictional area X S. Host Community Benefits III . EXPANSION PLANS • A. Application Permit 1 . Permittee: _ PA DEP 2. No . : _ 3 . State-- _ PA 't . Date of Submission: _ 4i97 5 . Copy Enclosed: Yes _ No X 6 . Submission Status: a . Expansion of current site or new site Current Site b . Local Citizenry reaction Positive C . Regulatory agency_ Positive • Bidder Disposal Site(s) Schedule 5.0 .J BID (PROPOSAL) FORM Page 5 of 7 INFORMATION 5CHEDULE J - (Continued) d. Litigation Yes e. Likelihood to succeed-Probable- Definate B. IF you are successful in Queeti.on III .A . , what is the additional annual DESIGN capacity in cubic yards (do not include Figures From Question 1998 ----------- 1,500,000 Tons 1999 1, 500,000 Tons 2000 1,500,000 Tons 2001' 1,500,000 Tons 2002 • C. At the annual OESI3N levels in Question 1II .3 . , what would be the projected useful 'life in years? 13-17 Years O , Would you be willing to share with the Town of Southold engineering reperts ut:i:Zed :.•r the °repzrat_On Of she Operating Permits on _xoansicn Applicat.on , Yes X No c. Bidder ' s DisPc5al Site(s) Engineer of Record Firm ' s Name Rust E & i Firm ' s Address Fairfax, VA Project engineer Jay Challa • Bidder Disposal Site(5) Pagedulee 5 °_S .O .J BID (PROPOSAL) FORM Pag ` • INFORMATION SCHEDULE J - (Continued) IV . ATTACHMENTS Attach copies of all permits required of the disposal site(s) and a copy of the agreement„ performance bond and insurance between bidder and permit holder to use the disposal site(s) during the term of this Agreement:. Are you willing to meet with the Town of Southold to discuss your short and long term disposal capabilities? Yes_No The undersigned hereby certifies that services, material, or equipment to be furnished as a result of this bid will be in full accordance with Town of Southold specifications applying thereto unless exceptions are indicated above and an explanation attached. Bidding Company ase Manaoemment 0 ewe�ork Address 123 Varick Avenue Brooklyn NY 11237 • City State Zip By Charles Gusmano Director of Business Development (Please Print or Type) NAME AND TITLE 71 Slgnature � t7 ✓h7�-.c._�_--` � Phone No . ( 718 ) 533-5314 Date 5/22/97 CC700RATE SEAL Bisner Dl_D"al Site(s) Schedule 5 .0 .J BID (PROPOSAL) FORM Page 7 of 7 • COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF ENVIRONMENTAL RESOURCES PINN S L VA N I A SOUTWENTPAL REGION - yra m OPERATIONS vista Management Program one Ararat Boulevard Harrisburg, Pennsylvania 17110 (717) 657-4588 May 27, 1993 TILE COPY Mr. James L. stips, General Manager Modern Trash Removal of York, Inc. R.D. $9, Box 316 York, PA 17402 Ra: Major Permit Modification Modern Landfill Permit No. 100113 Southwest Sspansion Windsor and Lower Windsor Townships York County Dear Mr. Stipsi I am pleased to enclose a Permit Modification approving the Southwest Expansion. It is issued SII accordance with the Pennsylvania Solid Waste Management Act, Act 97. Compliance with the limitations and stipulations that have been eat forth on your permit is mandatory. Tau have the right to appeal any limitation or stipulation as stated on your permit. Any person aggrieved by this action may appeal, pursuant to Section 4 of the Eavirommmntal Hearing Board Act, 33 P.S. section 7514, and the Administrative Agency Law, 2 Pa. C.S. Chapter 5A. to the Bavirommental Hearing Board, Second Floor, Market Street State Office Building, 400 Market Street, P.O. Box 8457, Harrisburg, PA 17105-8457, (717) 787-3483. TDD users may contact the Board through the Pennsylvania Relay Service, (800) 654-5984. Appeals must be filed with the Environmental Hearing Board within 30 days of receipt of written notice of thin action unless the appropriate statute provides a different time period. Copies of the appeal fors and the Board's rules of ;practice and procedure may be obtained from the Board, The appeal form and the Board's rules of practice and procedure are also available in braille or on audiotape from the Secretary to the Board at (717) 757-3483. This paragraph does not, in and of itself, create any right of appeal beyond that permitted by ap imable statutes and decisional law. Siy. P. Fair Program Manager FPF:SG • cc: York County Solid Waste A Refuse Authority York County Planning Commission Windsor Township Lower Windsor Township Review P"K INFORMATION 5LMEDuLE K FORM -OF BID BOND KNOA ALL MEN BY THESE PRESENTS, that me, the undersigned, WM of New York. Inc. as Principal, and Fireman's Fund Insurance Company es Surety, are hereby held and firmly dount unto Town of Southold as Owner in the sum of One Hundred T ousanil Dollars(100.000.N) for the payment of which , will and truly be made, we hereby jointly and severally bind ourselves, our heirs, executors, adininistratcrs, successors and assigns . Signed this 22nd day of May . JS 97 The =c„dition of the above obligation is such that whereas the Prircipal has submitted to the Town of !Southold a certain Bid, atteched hereto and hereby made a part hereof to enter into a contrac- in writing, for the hauling and disposal of construction mater; ai and/or demolition debris; NOW 7FEREFORE, :a) If said Bid shall be rejected or in the alternate, (b) If said Bid shall be accepted, and the Principal shall execute and deliver an Agreement in the Fors of the Sample Operating Agreement attached hereto (properly aompLe=ed in accordance with said Bid) and shall Furnish certificates of insurance and a. bond 'Or this re-thful performance of said .Agreement, and For the payment of all persons performing labor or furnishing materials in connection therewith, and shall in all othe^ respects perform the Agreement created by the accs�3tance of said Bid, then this obligation shall be •� void, otherwise the same shall remain in force and ef=e_t; it being expressly understood and agreed that the liability Of the Surety For any and all claims hereunder shall , in no event, exceed the penal amount OF this obligation as herein stated. Form CF Bid Bond Schedule S .O.K BIC ( PROPOSAL) FORM Page 1 of 3 'he u-�_ value . __e:vs^ , -e-__L st_ ___es ant >:greas tha: the ..__._a=_ars C` sa:= _ure=y e-c _=s bCnt sham - 7e i1 lc Well iMP8i-3d af'e;ma^ =b6, any Exters:.or. _5 the mime Wlthi- Wl1lL^ :he ,wne- may a_Cemt such 2_d; and sai' Su;emy doe:> he:'etV waive nct:_e a= a1y such exmensian . i': V '+1= ', se= _-__r "znc5 and seals, end such Cf Chem as a.-= ==-zcraticrs have _z.:sec t.`.ei- _=r Cram= Seals tm he he-a=c a"fixed arc thes? t.-. !�e 5: led _Lj =G21' teat _:?iCP.'S. .he tau a-_ 'ea.- -acve . WM F NEW YORK, INC. • =_ _i�ai Donald S. Haufe, Assistant Secretary FIREMAN'S FUND INSURANCE COMPANY puce- Me/issa man, ttorney-m- a_cr — 233 S. Wacker, Ste. 2000, Chicago, II. 60606 Cagy:•. DC"-EM-E-EN BY -_ZNT2P.0 =rt , °-- ILLINOIS OF DuPAGE Or _c : - 22nd tau zz _°97 oe?Ofla me came nnnalrl s. Haufe ==me :<^Cw-, whC =ezcss ar,C say t.^.a -F' -asita5 in Hinsdale. Illinois ^ Assistant Secretary 'Wast` ana eme�t f O -Western _ =f ='e R :X�A ivision o 4l�aste ana ement of C..^_-. _ ._ter. =.5=_ 13e- i1 and wi::^ 3x2=;.t3. _-z -_-„_,., =r.a= -e --Cws =`= sea: _:- =tee -e- __ - ^� OInc. was - :S SUC.. -2 Sea_ - _ -„-_5 _ -ae 'casrm +"OFFICIAL S -AL" PATTY J. K E N I S wcmary is NCJMFY PUKIC, S7a?F OF ILLINOIS Patty J. Kenis AI CofiiissiolCFz +ses 10/17/99 -'l_ C21U14- r CF : ==N, cay c =ercrm me :L =ane - 1.13 known, and ar,t <nnur. _= me to be an individual des=- nay in, and wnc axecL:_e� the fo agO1nL instrument in the Fi'A name and he A..u_y ack-cwl_?y^ed == me =ham he execL__st t'^e sale F=r and in Lie 5ena1= c= - enc =u-c=ses rm-t:=ned • i=C:. ;C'._=CCc:=\- '-z'v :NZ;:v 0UA._ ::JNTl A._:JJR bee:;re _e _a ha "a ^.e�'S - . ~,me k-lcwn and+riT:Cwr _C _a ,.rr?n- zesc. _Get a^.0 who sXet_=?� :'e ' ^S-^.ng _n_ _ _a ?_n �CW�eCS?^ _-a: he !X „'et zne y e� _ �., same . .vc_a__ PsC _c i GENERAL POVaR OF ATTORNEY FIREMAN'S FUND INSURANCE COMPANY I KNOW ALL MEN BY THESE PRESENTS:That FIREMAN'S FUND INSURANCE COMPANY,aCorporation duly organized and existing under the laws of � the State of California,and having its principal office in the County of Marin,State of California,has made,constituted and appointed,and does by these presents make,constitute and appoint DONALD S . HAUFE , KAREN E . BOGARD , REBECCA R. ALVES , LINDA M. MAKDAH, MELISSA M. NEWMAN, jointly or severally i CHICAGO IL its true and lawful Attomey(s)-in-Fact,with full power and authority hereby conferred in its name,place and stead,to execute,seal,acknowledge and deliver any and all bonds,undertaking,recognizances or other written obligations in the nature thereof _______________________________ and to bind the Corporation thereby as fully and to the same extent as if such bonds were signed by the President, sealed with the corporate seal of the Corporation and duly attested by its Secretary,hereby ratifying and confirming all that the said Attorney(s)-in-Fact may do in the premises. This power of attorney is granted pursuant to Article VII,Sections 45 and 46 of By-laws of FIREMAN'S FUND INSURANCE COMPANY now in full force and effect. "Article VII.Appointment and Authority of Resident Secretaries,Attorney-in-Fact and Agents to accept Legal Process and Make Appearances. Section 45. Appointment,The Chairman of the Board of Directors, the President, any Vitt-President or any other person authorized by the Board of Directors,the Chairman of the Board of Directors,the President or any Vice-President may,from time to time,appoint Resident Assistant Secretaries and Attorneys-in-Fact to represent and act for and on behalf of the Corporation and Agents to accept legal process and make appearances for and on behalf of the Corporation. Section 46.Authority.The authority of such Resident Assistant Secretaries,Attorneys-io-Fact and Agents shag be as prescribed in the instrument evidencing '• • - -- -�`—kw,n-.,t mvnnwt at anv time by the Board of Directors or by any person empowered to STATE OF Ill (link COUNTY OF DuPaRe On this 22nd day of May 19 97 , before me personally appeared Melissa M. Newman , known to me to be the Attorney- In- -act of Fireman's Fund Insurance Company , the corporation that executed the within instrument, and acknowledged to me that such corporation executed the same. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal , at my lOffice in the aforesaid county, h day and year in this certificate first above written. "OFFICIAL SEAL" KAREN E. BOGARD NOTARY PUBLIC, STATE OF 11.6:4010' My Commission Expires 4/20/99 Notary Publtc aren E. Bogard A. KRIEGER D ' i1r14 41 Y 1 04511 2 � N tory Public O CERTIFICATE v � STATE OF CALIFORNIA ss. COUNTY OF MARIN 1,the undersigned,Resident Assistant Secretary of FIREMAN'S FUND INSURANCE COMPANY,a CALIFORNIA Corporation,DO HEREBY CERTIFY that the foregoing and attached POWER OF ATTORNEY remains in full force and has not been revoked;and furthermore that Article VII,Sections 45 and 46 of the By-laws of the Corporation,and the Resolution of the Board of Directors;set forth in the Power of Attorney,are now in force. Signed and sealed at the County of Marin.Dated the 22nd day of May . 19 97 . C ;�z a nv Cha R6idcat A„Ia811[arC,CtBtf 360712—FF-11-87 GENERAL POWER OF ATTORNEY FIREMAN'S FUND INSURANCE COMPANY � KNOW ALL MEN BY THESE PRESENTS:That FIREMAN'S FUND INSURANCE COMPANY,a Corporation duly organized and existing under the laws of the State of California,and having its principal office in the County of Marin,State of California,has made,constituted and appointed,and does by these presents make,constitute and appoint DONALD S . HAUFE , KAREN E. BOGARD , REBECCA R. ALVES , LINDA M. MAKDAH, MELISSA M. NEWMAN, jointly or severally CHICAGO IL its true and lawful Attomey(s)-in-Fact,with full power and authority hereby conferred in its name,place and stead,to execute,seal,acknowledge and deliver any and all bonds,undertaking,recognizances or other written obligations in the nature thereof _______________________________ and to bind the Corporation thereby as fully and to the same extent as if such bonds were signed by the President, sealed with the corporate seal of the Corporation and duly attested by its Secretary,hereby ratifying and confirming all that the said Attomey(s)-in-Fact may do in the premises. This power of attorney is granted pursuant to Article VII,Sections 45 and 46 of By-laws of FIREMAN'S FUND INSURANCE COMPANY now in full force and effect. "Article VII.Appointment and Authority of Resident Secrefarles,Attorney-in-Fact and Agents to accept Legal Process and Make Appearances. Section 45. Appointment. The Chairman of the Board of Directors, the President,any Vice-President or any other person authorized by the Board of Directors,the Chairman of the Board of Directors,the President or any Vice-President may, from time to time,appoint Resident Assistant Secretaries and Attorneys-in-Fact to represent and act for and on behalf of the Corporation and Agents to accept legal process and make appearances for and on behalf of the Corporation. Section 46.Authority.The authority of such Resident Assistant Secretaries,Attoraeys-in-Fact and Agents shall be as prescribed in the instrument evidencing thew appointment.Any such appointment and all authority granted thereby may be revoked at any time by the Board of Directors or by any person empowered to make such appointment:' This power of attorney is signed and sealed under and by the authority of the following Resolution adopted by the Board of Directors of FIREMAN'S FUND INSURANCE COMPANY at a meeting duly called and held on the 7th day of August,1984,and said Resolution has not been amended or repealed: "RESOLVED, that the signature of any Vice-President, Assistant Secretary, and Resident Assistant Secretary of this Corporation, and the seal of this Corporation may be affixed or printed on any power of attorney,on any revocation of any power of attorney,or on any certificate relating thereto,by facsimile, and any power of attorney,any revocation of any power of attorney,or certificate bearing such facsimile signature or facsimile seal shall be valid and binding upon the Corporation" IN WITNESS WHEREOF,FIREMAN'S FUND INSURANCE COMPANY has caused these presents to be signed by its Vice-President, and its corporate May.sealto be hereunto affixed this 11 t h day of March l9 9 6 gD-1 FIREMA DI I E COMPANY zBy vimPrrsdrnt STATE OF CALIFORNIA COUNTY OF MARIN On this 11th day of March 19 96 ,before me personally came M A. Mal 1 o n e e to me known,who,being by me duly sworn,did depose and say:that he is Vice-President of FIREMAN'S FUND INSURANCE COMPANY,the Corporation described in and which executed the above instrument;that he knows the seal of said Corporation;that the seal affixed to the said instrument is such corporate seal;that it was so affixed by order of the Board of Directors of said Corporation and that he signed his name thereto by like order. IN WITNESS WHEREOF,I have hereunto set my hand and affixed my official seal,the day and year herein first above written. A. KRIEGER D 1r-n%-%i r,t 0.451 t 2 l; r'` Ntary Wbac CERTIFICATE STATE OF CALIFORNIA ss. COUNTY OF MARIN I,the undersigned,Resident Assistant Secretary of FIREMAN'S FUND INSURANCE COMPANY,a CALIFORNIA Corporation,DO HEREBY CERTIFY that the foregoing and attached POWER OF ATTORNEY remains in full force and has not been revoked;and furthermore that Article VII,Sections 45 and 46 of the By-laws of the Corporation,and the Resolution of the Board of Directors;set forth in the Power of Attorney,are now in force. Signed and sealed at the County of Marin.Dated the 22nd dayof May , l9 97 . "Z i� 4 yc �"4c RmidmtA iistaetS etatf X611912—FF—1 1.87 INFORMATION SCHEDULE L PERFORMANCE BOND Bond No . KNOW ALL MEN BY THESE PRESENTS, that (hereinafter called the "principal" ) and _(hereinafter called the "Surety") are held and Firmly bound to the Town of Southold Chereinafter called the "Owner") in the Full and gust sum of dollars C$. ) good and lawful money of the United States of America, for the payment of which sum of money, well and truly to be made and done, the Principal binds himself, his heirs, executor's, administrators and assigns and the Surety binds itself, its successors and assigns, ,jointly and severally, firmly by these presents. WHEREAS, the Principal has entered into a certain written Agreement bearing date on the day of , 199 with the Owner for the Town of Southold construction material and/or demolition debris Haul- Disposal Services, a copy of which Agreement is annexed to and hereby made part of this bond as though herein set Forth in Full . • NOW, THEREFORE, the conditions of this obligation are such that if the Principal , his or its representatives or assigns, shall well and faithfully comply with and perform all the terms, covenants and conditions of said Agreement or his Ctheir, its) part to be kept and performed and all modifications, amendments, additions and alterations thereto that may hereafter be made, according to the true intent and meaning of said Agreement, and shall fully indemnify and save harmless the Owner From all cost and damage which it may suffer by reason of Failure so to do, and shall Fully reimburse and repay the Owner for all outlay and expense which the Owner may incur in making good any such default, and shall protect the said Owner against, and pay any and all amounts , damages, costs and ,judgments which may or shall be recovered against said Owner or its officers or agents or which the said Owner may be called upon to pay to any person or corporation by reason of any damages arising or growing out of the doing of said work, or the repair of maintenance thereof, or the manner of doing the same, or the neglect of the said Principal , or his (their, its) agents or servants or the improper performance of the said work by the said Principal, or his Ctheir, its) agents or servants , or the infringement of any patent or patent rights by reason of the use of any materials Furnished or work done as aforesaid or otherwise, then this obligation shall be null and void , otherwise to remain in Full Force and effect; Performance Bond Schedule S .O .L BID (PROPOSAL) FORM Page 1 of 2 t:u -❑ Dn 1•' (-. 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O IA 0 0 0 3 J' N n "1 3 J O In J (D O In 7 C r• J rl rt -1) rr O N N to rt E to O J N O' 11 N Il 11 n. N O. O O 'Y J' (1 r r• J' rr r• rt (n J (C to -(I (n N ID to in n 7 rl (D IU ID I-• r N < N 0. J' r' U) - C1 n 11) n C U -)' r• '1 U to H. rt " J -1 Ill J N N to 7 C J rt ED in J" J 3 N J (D J - 0 U IC to -. O' (1. 0. D U= 1-1 11 to N J' r-- (D (D (1 r' I-• 1-- (D r ED c n ED - In In O J (D in J 0. N r' n. DI O rt 1- 1) N '1 O' r- J N N 11 E rt 1-. 0. N ED ll C I c rt NN N O N '"1 U 0. r- I-•In "1 (D J IC to N Cl ED to I- n 5. 11) n N 1 to r J '1 o (D rnto r' n n n 0 - tl (D I I N (A Ll J' lU r1 r1 n. U 7 0 '1 U 10 11 3 11 "1 to rt 0 11 E 'n n. N O. to N r- -1' N r•• N 3 to < J N (D O J 11l O < I J 111 I N 7 (t' i 1- N (1 J ID Ill 1- Cl' - J (n 1^ 7 3 N C (0 U' to -.:Jr :11 I I I (C (L rt ED U rl 1•.(C ID in (D O rr 1t J 11 rt J N 11 (D U J O 11 r_. "I E r N 0. r, rt O N 0. - 11 rr N N '1 N n. O U O E J Il 111 IT I '1' J (D U it I- I U' J' "1 J J (n J C U 1 11 rl N N r O T r- O to to rt I-- rt O' I I I "I In In N N to 0 Ic CL - 11 ED 'U 111 ED ?C(C rt rn 11 (D 0 v 11 0 In 7 0 (c INFORMATION SCHEDULE M OPERATIONAL PLAN The Bidder hereby states that it proposes to implement the following operational plan to haul and dispose of Construction Material and/or Demoliton Debris (C&D) from the Town of Southold Landfill if awarded an Agreement. I. Haul Summarize the manpower and equipment you will make available to perform under this Agreement. SEE ATTACHED OPERATIONAL PLAN II. Disposal Summarize the identity and location of the primary and secondary sites you plan to use for disposal of the construction material and/or demolition debris. Describe the arrangements between your company and the disposal site for use of the site. Describe any treatment the C&D will undergo during transport or upon arrival at the disposal site. Attach copies of the permits to construct and permits to operate the disposal site. Site No. 1 WM of NewYork, Inc. DBA NAME Waste Management of New York LOCATION 123 Varick Avenue Brooklyn NY CONTACT PERSON AND PHONE NO. Charles Gusmano 718-533-5314 Operational Plan Schedule 5.O.M . Bid (Proposal) Form 1 of 2 ARRANGEMENTS FOR USE N/A • TREATMENT OR UNUSUAL CONDITIONS N/A Site No. 2 NAME Modern Landfill (Owned by Waste Management ) LOCATION RD N 9, Box 317 York, PA 17402 CONTACT PERSON AND PHONE NO. Sam Lybrand 215-736-9400 ARRANGEMENTS FOR USE N/A • TREATMENT OR UNUSUAL CONDITIONS N/A OPERATIONAL PLAN Schedule 5.0.M • Bid (Proposal) Form 2 of 2 • OPERATIONAL PLAN WM of New York, Inc. shall furnish all labor and equipment necessary to transport and dispose of Construction/Demolition Debris from the Town of Southold's facility and to perform its obligations under this Contract. The Transfer Facility shall be available for loading of Waste Management's trucks between the howl of 7:00 am to 4:00 pm Monday through Friday, and at such times as the transfer station is required to be operated pursuant to this contract. All transfer trailers shall be loaded, weighed and staged from 6:30 am to 4:30 pm Monday through Friday. Transportation and disposal shall be provided as specified in the bid documents, Monday through Friday, between the hours of 7:00 am and 4:00 pm. and if necessary other hours as described in the bid documents. Based on the Town's typical waste flow, truck(s) shall be dispatched from the Facility to our permitted approved Disposal Facilities. Each truck's departure from the Transfer Facility shall be staggered by 10 minutes per truck. The above schedule is only intended to be an outline, and will be approximately adjusted to handled fluctuations in waste flow to the Transfer Facility. WM of New York, Inc. shall provide sufficient and reliable equipment to efficiently transport the Construction/Demolition waste as described in the Bid Documents during the term of the contract. See attached "Equipment Listing" included in this submission for specifications equipment intended for use. WM of New York, Inc. has the ability to commence work on the bid project within the time frame detailed in the bid documents. COMNK)NWEALTH OF PENNSYLVANIA DEPARTMENT OF ENVIRONMENTAL RESOURCES p%NNSTLVAN1A SOOTHCgSAL REGION - FIELD OPERnIONS Wiste Management Program One Ararat Boulevard Harrisburg, Pennsylvania 17110 (117) 657-4588 May 27, 1993 Nr. James L. Stipe, General Manager r SLE COPY Modern Trash Removal of York, Inc. R.D. 09, Box 316 York, PA 17402 Ras Mayor Permit Modification Modern Landfill Permit No. 100113 Southwest Expansion Windsor and ,Lower Windsor Townships York County Dear Mr. Stipet I an pleased to enclose a Permit Modification approving the Southwest Expansion. It Is issued in accordance with the Pennsylvania Solid Waste Management Act, Act 97. Compliance with the limitations and stipulations that have been set forth on your permit is mandatory. Tau have the right to appeal any limitation or stipulation u stated on your permit. Any person aggrieved by this action my appeal, pursuant to Section 4 of the Environmental Nearing Board Act, 33 P.S. section 7514, and the Administrative Agency Law, 2 Pa. C.S. Chapter 5A. to the Environmental name l3tearingP.O. Box econd ,7 Floor, Market Street State Office Building, Harrisburg, PA 17105-8457, (717) 787-3483. TDD users may contact the Board through the Pennsylvania Relay Service, (800) 654-5984. Appeals must be filed with the Environmental Hearing Board within 30 days of receipt of written notice of thin action unless the appropriate statute provide@ a different time period. Copies of the appeal form and the Board's rules of ,practice and procedure may be obtained from the Board, The appeal form and the Board's rules of practice and procedure are also available in braille or on audiotape from the Secretary to the Board at (717) 787-3483. This paragraph does not, in and of itself, create any right of appeal beyond that permitted by sp cable statutes and decisional law. Si sly. y� 04r nein P. fair Program Manager FPB:SG cc- York County Solid Waste A Refuse Authority York County Planning Commission Windsor Township Lower Windsor Township Hsololed POPW OF SEH. sanitation • z PERMIT AND INSPECTION UNIT 137 Center Street,Room 104 New York,New York 10013 Telephone(212) 219-5040 Date of Issuance - August 19 , 1996 NON-PUTRESCIBLE SOLID WASTE TRANSFER STATION PERMIT Transfer Station Number: 139 Address : Waste Management of New York A division of WM of New York, Inc . 123 Varick Avenue Brooklyn, New York 11237 Block # 2974 Lot # 51 From: 3/26/96 To : 12/31/96 The above referenced location is to be used only for the reception and deposition of non-putrescible solid waste material . • Such waste material is to be removed from the transfer station for final disposition within 48 hours . This permit is further subject to the following conditions : (1) The height of the non-putrescible solid waste pile (s) must not exceed 8 feet; (2) A 10 foot opaque fence must enclose the site on all sides of the property; (3 ) The volume of non-putrescible solid waste stored on Block 2974, Lot 51 shall not exceed 5, 000 cubic yards ; (4) The volume of non-putrescible solid waste stored in the two areas in the west-central portion of Block 2968 , Lot 1 shall not exceed 5, 000 cubic yards . (The storage of non-putrescible solid waste at Block 2968 , Lot 1 shall be in accordance with the drawing submitted by Donald Levy on 4/26/95) • Page 1 of 3 NEEP NYC CLEAN t REDCCE. REUSE:. RECI(LE i= DONF LITTER printed on rec%cled paper (5) A working water supply must be within access of all sections of the pilel:s) ; (6) Dust created by the dumping and transferring of non- putrescible solid waste must be kept under control ; (7) Only non-putrescible solid waste can be dumped at your transfer station site as defined by the Department' s rules and regulations; (8) A daily record shall be kept showing what non-putrescible solid waste is brought into the site by cubic yards, where it came from, and where it was ultimately disposed of by cubic yards ; (9) Non-putrescible solid waste may be deposited only in the depository area initially outlined for this purpose on the survey map; • (10) This permit should be prominently displayed at the transfer station site and available for review by Department inspectors at all times . (11) This permit is conditioned upon compliance by the permittee with any and all rules and regulations of the Department of Sanitation in existence on the date of this; permit' s issuance, and any operating rules amended or promulgated during its term. You are hereby advised that the renewal of this permit may be conditioned upon compliance with rules concerning the siting of transfer stations to be promulgated by the Department pursuant to Local Law 40 of 1990 . (12) This permit is issued upon the condition that the permittee shall comply with the Federal , State, and Local Laws , Regulations and Rules governing the installation of a system for the sanitary disposal of storm water, sewage and waste water, and the discharce of storm water, sewage and waste water. The permittee shall have until September 18, 1996 to install a system complying with such Laws , Regulations and Rules , and to secure all licenses and permits required by such Laws , Regulations and Rules . if, • for any reason, the permittee fails to comply with this condition, this permit shall , upon written notice to the permittee, be revoked . Page 2 of 3 (13 ) This permit is issued upon the condition that the permittee shall submit a certified copy of a deed as recorded in the Office of the City Register as soon as it is available. If, for any reason, the permittee fails to comply with this condition, this permit shall, upon written notice to the permittee, be revoked. All operations at these premises and the use thereof shall be in conformity with all applicable federal, state and local laws, and the rules and regulations of any governmental agency having jurisdiction over these premises or the use thereof; and in accordance with any statements contained in your application. SPECIAL NOTE : THIS PERMIT IS BASED UPON THE CONDITIDON SUBSEQUENT THAT THE HOLDER OBTAIN RENEWALS OF ALL REQUIRED PERMITS AND SUBMIT COPIES OF THOSE RENEWED PERMITS TO THE PERMIT & I:NSPECTION UNIT, DEPARTMENT OF SANITATION. THE DEPARTMENT' S PERMIT SHALL BE SUSPENDED IF THE HOLDER SHALL FAIL TO RENEW ANY AND ALL REQUIRED PERMITS AND PROMPTLY SEND COPIES OF THOSE RENEWED PERMITS TO THE PERMIT & INSPECTION • UNIT. FAILURE TO COMPLY WITH THE ABOVE NOTED RULES SHALL ALSO RESULT IN SUSPENSION. THIS PERMIT IS SUBJECT TO REVOCATION IF THE PERMITEE IS FOUND TO BE UNFIT BY THE TRADE WASTE COMMISSION, DEPARTMENT OF INVESTIGATION OR ANY OTHER REGULATORY AGENCY WITH JURISDICTION OVER THE PERMITEE. Thomas Milora I • New York State Department of Environmental Conservation • Division of Compliance Services, Region 2 Office _ 47140 21st Street, Long Island City, NY 11101 Tel: (7181482-4997 Fax: (7181482-4975 game 30 October 1996 _ Richard D. Galli, P. E. Galli Engineering, P. C. 734 Walt Whitman Road Melville, NY 11747 Re: DEC Permit No. 2-6104-00013/00001-0 Waste Management of New York, 123 Varick Ave., Brooklyn, NY 11237 ECL Artice 27 -- Solid Waste Management NOTICE OF PERMIT RENEWAL Dear Mr. Galli: Enclosed is your client's permit. Please have your client read all conditions carefully. • Please provide a full copy of this permit to all agents, contractors, and employees performing any part of the permitted activities. If you have any technical questions regarding this permit, please call Anthony Masters, of the DEC Region 2 Division of Solid and Hazardous Materials at (718) 482-4996; procedural or environmental review questions should be directed to John Cryan of my staff at the number above. Ve<V, V yours, John J. Fergus,7 / Regional Permit Administrator cc: A. Masters, DEC Region 2 Div. of Solid & Hazardous Materials Capt. L. Kelly, DEC Region 2 Division of Law Enforcement • encl. JJF/JFC:bh (WP60/PERMIT.LET) • NEW YORK STATE DEPARTMENT OF CONSERVATION DEC PERMIT NUMBER: EFFECTIVE DATE: 2.6104-00013/00001-0 30 October 1996 FACILITY/PROGRAM NUMBER(S): PERMIT EXPIRATION DATE(S): 24W89 30 October 2001 Under the Environmental Conservation Lew (ECL) CTYPE OF PERMIT: ❑ New X Renewal X Modification X Permit to Construct X Permit to Operate ❑ Article 15,Title 5: Protection ❑ 6 NYCRR 608: Water Quality X Article 27, Title 7; 6 NYCRR 360: of Waters Certification Solid Waste Management ❑ Article 15, Title 15: Water ❑ Article 17, Titles 7, 8: SPDES ❑ Article 27, Title 9; 6 NYCRR 373: Supply Hazardous Waste Management El 19: Air Pollution ❑ Article 15, Title 15: Water Control ❑ Article 34: Coastal Erosion Transport Management ❑ Article 24: Freshwater Wetlands ❑ Article 15, Title 15: Long ❑ Article 36: Floodplain Island Wells ❑ Article 25: Tidal Wetlands Management PERMIT ISSUED TO: Waste Management of New York, Inc. TELEPHONE NUMBER: (718) 386 -7900 • ADDRESS OF PERMITTEE: 123 Varick Avenue, Brooklyn, NY 11237 CONTACT PERSON FOR PERMITTED WORK: Richard D. Galli, P. E. TELEPHONE NUMBER: Galli Engineering, P. C., 734 Wait Whitman Road, Suite 402A, Melville, NY 11747 (516) 271 - 9292 PROJECT/FACILITY NAME: Waste Mgmt. of NY Solid Waste Transfer Station and Recyclables Handling and Recovery Facility PROJECT/FACILITY ADDRESS: 123 Varick Avenue, Brooklyn, NY 11237 COUNTY: Kings TOWN: New York City WATER BODY: None NYTM COORDINATES: 590.5 East; 4507.2 North DESCRIPTION OF AUTHORIZED ACTIVITY: Construction and operation of a solid waste transfer station and recyclables handling and recovery facility with a maximum allowed total solid waste throughput of 7,499 cubic yards per day, consisting of a maximum of 500 cubic yards per day of putrescible solid waste and 6,999 cubic yards per day of construction and demolition debris. By acceptance of this permit, the permittee agrees that the permit is contingent upon strict compliance with the ECL, all applicable regulations, the General Conditions specified (see page 2) and any Special Conditions included as part of this permit. (REGIONAL PERMIT ADMINISTRATOR: ADDRESS: NYS DEC Region 2 Office, 47-40 21st Street • .John J. Ferguson Long Island City, NY 11101 PHONE: (718) 482-4997 ,AUi ORIZE SIGNATU DATE: 30 October 1996 Page 1 of 5 r� GENERAL CONDITIONS Instructions 1. The permitted site or facility, including relevant records, is subject to inspection at reasonable hours and intervals by authorized representatives of the Department of Environmental Conservation (the Department) to determine whether the Permittee is complying with the instant permit and the ECL. Such representatives may order the work suspended pursuant to ECL 71-0301 and SAPA 401(3). A copy of the instant permit, any and all amendments thereto, and any and all documents referenced in such permit or amendments, must be available for inspection by the Department at all times at the project site. Failure to produce a copy of such permit, such amendments, or such referenced documents upon request by a Department representative is a violation of this permit. Any permit sign provided by the Department shall be displayed in a visible facility location and protected from the elements for the life of this permit. Permit Changes and Renewals 2. The Department reserves the right to modify, suspend, or revoke this permit when-- a) the scope of the permitted activity is exceeded or a violation of any condition of the permit or provisions of the ECL and pertinent regulations is found; b) the permit was obtained by misrepresentation or failure to disclose relevant facts; c) new material information is discovered; or d) environmental conditions, relevant technology, or applicable law or regulation have materially changed since the permit was issued. 3. All work authorized herein shall comply with the most current information submitted by the Permittee • pursuant to its application for the instant permit. If such information conflicts with any provision of the instant permit, such provision shall obtain. The Permittee must submit a separate written application to the Department for renewal, modification, or transfer of this permit. Such application must include any forms,fees, or supplemental information the Department requires. Any renewal, modification, or transfer granted by the Department must be in writing. 4. The permittee must submit a renewal application at least-- a) 180 days before expiration of permits for State Pollutant Discharge Elimination System (SPDES), Hazardous Waste Management Facilities (HWMIF), major Air Pollution Control (APC), and Solid Waste Management Facilities (SWMF); and b) 30 days before expiration of all other permit types. 5. Unless expressly provided for by the Department, issuance of this permit does not modify, supersede, or rescind any order or determination previously issued by the Department or any of the terms, conditions, or requirements contained in such order or determination. Other Legal Obligations of Permittee 6. The Permittee has accepted expressly, by the execution of its application for the instant permit, the full legal responsibility for all damages, direct or indirect, of whatever nature and by whomever suffered, arising out of the project described in this permit and has agreed to indemnify and save harmless the State from suits, actions, damages, and costs of every name and description resulting from this project. 7. This permit does not convey to the Permittee any right to trespass upon the lands or interfere with the riparian rights of others in order to perform the permitted work nor does it authorize the impairment of • any rights, title, or interest in real or personal property held or vested in a person not a party to the permit. 8. The Permittee is responsible for obtaining any other permits, approvals, lands, easements, and rights-of- way that may be required for this project. Permit No. 2-6104-00013/00001-0 Page 2 of 5 rADDITIONAL GENERAL CONDITIONS FOR ARTICLES 15(TITLE 5),24,26,34,36 AND 6NYCRR FART 608 • • 'rhat if future operations by the State of New York require an 12. All necessary precautions shall be taken to .alteration in the position of the structure or work herein preclude contamination of any wetland or waterway by authorized,or if,in the opinion of the Department of Environmen- suspended solids,sediments, fuels,solvents, lubricants, epoxy 'tal Conservation it shall cause unreasonable obstruction to the coatings,paints,concrete,leachate or any other environmentally free navigation of said waters or flood flows or endanger the deleterious materials associated with the project. health,safety or welfare of the people of the State,or cause loss 13. Any material dredged in the prosecution of the work herein or destruction of the natural resources of the State, the owner permitted shall be removed evenly, without leaving large refuse may be ordered by the Department to remove or after the piles,ridges across the bed of a waterway or floodplain or deep structural work,obstructions,or hazards caused thereby without holes that may have a tendency to cause damage to navigable expense to the State,and if,upon the expiration or revocation of channels or to the banks of a waterway. this permit,the structure,fill, excavation, or other modification 14. There shall be no unreasonable interference with navigation by of the watercourse hereby authorized shall not be completed,the the work herein authorized. owners,shall,without expense to the State, and to such extent 15. If upon the expiration or revocation of this permit, the project and in such time and manner as the Department of Environmen- hereby authorized has not been completed, the applicant shall, tal Conservation may require, remove all or any portion of the without expense to the State, and to such extent and in such uncompleted structure or fill and restore to its former condition time and manner as the Department of Environmental Conserve- the navigable and flood capacity of the watercourse. No claim tion may require, remove all or any portion of the uncompleted shall be made against the State of New York on account of any structure or fill and restore the site to its former condition. No such removal or alteration. claim shall be made against the State of New York on account 10. That the State of New York shall in no case be liable for any of any such removal or alteration. damage or injury to the structure or work herein authorized 16. If granted under Article 36, this permit does not signify in any which may be caused by or result from future operations way that the project will be free from flooding. undertaken by the State for the conservation or improvement of 17. If granted under 6NYCRR Part 608, the NYS Department of navigation, or for other purposes, and no claim or right to Environmental Conservation hereby certifies that the subject compensation shall accrue from any such damage. project will not contravene effluent limitations or other limitations 11. Granting of this permit does not relieve the applicant of the or standards under Sections 301,302, 303,306 and 307 of the responsibility of obtaining any other permission, consent or Clean Water Act of 1977 IPL 95-2171 provided that all of the • approval from the U.S. Army Corps of Engineers, U.S. Coast conditions listed herein are met. Guard, New York State Office of General Services or local 18. All activities authorized by this permit must be in strict government which may be required. conformance with the approved plans submitted by the applicant or his agent as part of the permit application. Such approved plans were prepared by {see Special Condition No. 2 on Page 41 on SPECIAL CONDITIONS Please see the numbered Special Conditions on the following page. SPECIAL NOTE: In accordance with Title 19, Part 600.4 (c) of the New York Code of Rules and Regulations, the New York State Department of Environmental Conservation hereby certifies that the action described and approved in this permit, if located within the Coastal Zone, is consistent to the maximum extent practicable with the policies and purposes of the New York City Waterfront Revitalization Program. • DEC PMMrr Nuataet: Continued on next page!... 2-6104-00013/00001-0 1430AnTff 123 Varick Avenue, Brooklyn NY 11237 Waste Management of New York Pae 3 of 5 NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION SPECIAL CONDITIONS 1. All work and activities authorized by this permit shall comply with all of the applicable provisions of 6 N'YCRR Part 360 (Solid Waste Management Regulations), especially Subparts 360-1, 360-11, and 360-12, unless otherwise specified herein. 2. All construction and operation activities authorized by this permit shall be in strict conformance with the application materials submitted to DEC by the permittee in support of this application, including the following: a. An engineering report, appendices, and operations and maintenance manual (4 bound volumes), prepared for Waste Management of New York by Richard D. Galli, P. E., dated 7/30/96. b. An 8-sheet set of facility site plans prepared for Waste Management of New York, signed and stamped by Richard D. Galli, P. E., dated 7/30/96. 3. Within ten (10) days after the completion of any construction authorized by this permit, permittee shall have a professional engineer licensed by the State of New York submit to DEC Regional Solid and Hazardous Mlaterials Engineer certification that the subject facility is constructed in conformance with the site plan described in Special Condition No. 2 (b) above. Permittee shall not operate the facility under the terms of this permit until after DEC has received the facility engineer's certification of completion of construction, and until after permittee receives written confirmation from DEC that DEC deems the construction to be complete and in accord with the facility plan. This condition does not apply if no new construction will be done at the facility by permittee. 4. If it has not yet done so, permittee shall, within thirty (30) days after the effective date of this permit, submit to DEC an irrevocable bank letter of credit in the amount of $50,000, or a performance bond in the amount of $100,000, guaranteeing permittee's compliance with the terms and conditions of this permit, and guaranteeing compliance with the Environmental Conservation Law of the State of New York. Said letter of • credit or performance bond shall be in the form attached to this permit. Permittee shall keep its letter of credit or performance bond in effect for the duration of its operation of the facility, until DEC accepts permittee's engineer's statement of facility closure under the terms of 6 NYCRR Part 360. 5. Solid waste which is not recycled shall be sent only to the approved solid waste disposal facilities documented in the application with letters of intent and all currently required, valid permits to operate. At least three months prior to the expiration of any permit required to operate any of the disposal facilities described above, permittee shall submit a complete copy of the renewed permit or permit extension to the Regional Solid and Hazardous Materials Engineer at the Region 2 Office of DEC. If permittee fails to submit such copy, or if any disposal facility loses any governmental authorization required to operate any of the disposal facilities named above for any reason, including expiration and failure to renew permits, permit suspension, permit revocation, or facility closure, cessation of operations, or abandonment, permittee shall immediately cease sending solid waste to such facility or facilities for disposal, and shall notify the DEC Region 2 Solid and Hazardous Materials Engineer of such cessation and the reason(s) for it. If permittee wishes to add or otherwise change the disposal facilities to which permittee is authorized to send solid waste, permittee shall submit letters of intent from such disposal facilities, and copies of all required permits to operate such disposal facilities, to the DEC Region 2 Solid and Hazardous Materials Engineer. Upon written authorization from the DEC Region 2 Solid and Hazardous Materials Engineer, permittee may send solid waste to such disposal facilities. • DEC PERMIT NUMBER: 2-6104-00013/00001-0 PERMITTEE: Waste Management of New York Page 4 of 5 FACILITY: 123 Varick Av BKN NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION SPECIAL CONDITIONS 6. The account to fund the environmental monitor(s) as established under a previous version of this permit shall continue as follows: a. The sum of $10,000 shall be maintained with the Department for funding of environmental compliance activities related to the operation of the facility herein permitted. This sum is based on annual monitor program costs and is subject to quarterly revision. Subsequent quarterly payments shall be made for the duration of this permit to maintain an account balance sufficient to meet the next nine months' anticipated expenses. Quarterly payments shall be made for the duration of this permit in accordance with the following provisions. b. Costs to be covered by this fund include: i) Direct personal service costs and fringe benefits of the environmental monitor(s) and full-time monitor supervisor(s), including the costs of replacement personnel for the person(s) regularly assigned to these positions; ii) Direct non-personal service costs, including without being limited to purchase or lease of a vehicle if necessary and its full operating costs, and any appropriate chemical sampling and analysis; iii) Inflation increases and negotiated salary increases; and iv) Indirect support or overhead costs at the NYS DEC Federally-approved Indirect Cost. Rate. C. Upon written request by permittee, the Department shall make available to permittee any records (e. g., vouchers, time records) relating to such monitor costs, consistent with applicable law. d. As noted, the Department may revise the required payment on a quarterly basis to include all costs of monitoring to the Department. The quarterly revision may take into account factors such as inflation, salary increases, accrued interest to be applied to the balance, changes in operating hours and procedures, and the • need for additional on-site monitors and supervision of such monitors by full-time monitor supervisors. Upon written request by the permittee, the Department shall provide permittee with a written explanation for the basis Of any modification. e. Within 30 days of written notice by the Department that a payment is due, payment shall be forwarded to the Department. Payment should be sent to: NYS Department of Environmental Conservation, 50 Wolf Road, Room 593, Albany, NY 12233-1510, Attention: Director of Environmental Monitors. Payments shall be in advance of the period in which they will be expanded. f. Upon termination (expiration without renewal, revocation, or transfer) of this permit and payment of any outstanding costs, the unexpended balance including interest will be returned to the permittee. g. Failure to make the required payments is a violation of this permit. The Department may take appropriate action to enforce the payment provisions, including suspension or revocation of the permit. h. The environmental monitor shall, when present at the permitted site, abide by all of permittee's health and safety and operational requirements and policies; provided, however, that this subparagraph shall not be construed as limiting the monitor's powers as otherwise provided for by law and shall not result in the monitor's being less protected than the monitor would be if he or she were to abide by state and federal health and safety requirements. i. The permittee shall furnish to the environmental monitors a current site policy and procedures manual for health and safety issues. Within ten (10) days of any revision to the health and safety plan, the permittee shall notify DEC, in writing, of such modification. • DEC PERMIT NUMBER: 2-6104-00013100001-0 SITE: 123 Varick AV, BKN PERMITTEE: Waste Management of New York Page 5 of 5 *Galli engineering, P.C. November 1, 1996 Mr. Anthony Cucinotta Waste Management of New York A Division of New York Acquisition Sub, Inc. 123 Varick Avenue Brooklyn, NY 11237 Re: Part 360 Permit Dear Mr. Cucinotta: Enclosed is the original of your Part 360 permit for 123 Varick Ave. Please review the permit conditions at your earliest convenience. If any questions should arise • or additional information is required, please feel free to contact me. GALLI ENGINEERING, P.C. Id, §k,---. Ken Brooks, P.E. Project Manager c: File 734 Walt Whitman Road • Suite 402A • Melville NY 11747 • 616-271-9292 • F" 616-271-9345 W20-1 reran —ed New York State Department of Environmental Conservation Iowa NOTICE MAW The Department of Environmental Conservation (DEC) has issued permit(s) pursuant to the Environmental Conservation Law for work being conducted at this site. For further information regarding the nature and extent of work approved and any Departmerital conditions on it, contact the Regional Permit Administrator listed below. Please refer to the permit number shown when contacting the DEC. tgionai ermit A ministrator Z— 5O t013- 0001 00001 0 Regulatory Affairs Permit Number Hunters Point Plaza 4740 21 st Street Long Island City, NY 11101 Expiration Date 30 OCTOSM ZOO NOTE: This notice is NOT a permit • THIS AGREEMENT, made on the day of 1997, by and between the Town of Southold, a municipal corporation of the State of New York having its principal place of business at 53095 Main Road, Southold, New York hereinafter called the "Town" and hereinafter called the "Contractor." WITNESSETH WHEREAS, Contractor has submitted to the Town a bid dated 1997 ("Bid") in response to the Town's Bid Solicitation for Construction Material and/or Demolition Debris Hauling-Disposal • Services dated _, 1997, ("Solicitation"); and WHEREAS, the Town Board of the Town of Southold by resolution No. adopted on authorized the Town Supervisor to enter into an agreement with the Contractor to perform certain services in connection with the handling of solid waste, NOW, THEREFORE, it is mutually covenanted and agreed by and between the parties hereto as follows: I. DEFINITIONS - Terms defined in the Bid Solicitation shall have the some meaning as if defined herein. • APPENDIX A-1 • II. SCOPE OF SERVICES - The Contractor shall perform the services in accordance with the description of those services as set forth in the Solicitation. III. TERM OF AGREEMENT - The Term of this Agreement shallk be three (3) years commencing on July _ The Town, at its sole discretion, shall have the option of renewing the Agreement for two (2) additional one (1) year terms by giving Contractor written notice of its intention to renew at least thirty (30) days prior to the expiration of the term. IV. PRICE SCHEDULE/COMPENSATION - The unit bid price schedule for the services to be furnished by Contractor is found in Section C - 3.1, 3.2 Contractor's bid which is incorporated into this Agreement. • V. PAYMENTS - The Contractor shall received monthly payments for services performed during the prior calendar month. The Contractor shall submit a request for payment on a Town approved voucher form along with Contractor's invoice which shall include a daily summary of tonnage hauled by Contractor at a Disposal Sit as applicable. Such payments shall be made within sixty (60) days of the Town's approval of Contractor's invoice. The Town shall be entitled to deduct from any payment owning to Contractor any sums expended by the Town to cure any default or other Agreement non-compliance by • APPENDIX A-2 sums expended by the Town to cure any default or other Agreement non-compliance by Contractor or to protect the Town from loss on account of any claims filed or reasonably anticipated to be filed . VI . CONTRACTOR 'S WARRANTIES AND REPRESENTATIONS Contractor makes the Following warranties and representations: A . Contractor represents that the Town has made no commitment under this Agreement with respect to the volume of construction material and/or demolition debris to be handled by Contractor during the term of this Agreement . • B . Contractor warrants that Contractor, shall comply with all Federal , state and local laws, ordinances or regulations applicable to all of the services to be performed by Contractor . C . Contractor represents that the information Furnished by Contractor in the equipment schedules included in the bid is accurate and complete and Contractor acknowledges that Town has relied upon the accuracy and completeness of that inFormation in .the selection of Contractor as the lowest responsible bidder . D . The Contractor represents that Contractor shall utilize its best efforts to insure that Minority and Women • Owned Businesses (MBE 's and WBE 's) have the opportunity to participate as subcontractors under this Agreement . In the event the contractor subcontracts twenty-five percent (E5:) or more of APPENDIX A-3 its work hereunder, Contractor shall submit to the Town an MBE and a WBE Utilization Plan, prior to execution of this Agreement . E. In the event the Contractor ' s Disposal Site is unable to receive and dispose of the Town 's construction material and/or demolition debris for any reason (including Failure to obtain or maintain necessary permits or licenses) , Contractor shall be responsible for providing to the Town an alternate Disposal Site for the Town 's use at no additional cost to the Town, and shall indemnify the Town against any additional hauling cost by the Town or its agent because of the location of the alternate Disposal Site. Under no circumstances shall a • change in Disposal SiteCs) or failure or inability to obtain or maintain necessary permits by the Contractor be considered a change in conditions . In the event the Contractor is unable to Find an alternate Disposal Site(s) , he shall be deemed to be in default of this Agreement and liable for damages, bond Forfeitures and other expenses as provided in the Agreement . VII . INDEMNIFICATION INSURANCE/BONDS A . Contractor agrees to defend, indemnify and save harmless the Town of Southold against any and all liability , loss, damage, detriment, suit, claim, demand, cost, charge, attorney 's Fees and expenses of what ever kind or nature which the Town may directly or indirectly incur, sui=Fer or be required to pay by reason of or in consequence of the Contractor carrying • out or performing under the terms of this Agreement,g ement, or failure to carry out any of the provisions, duties, services or APPENDIX A-L} requirements of this Agreement, whether such losses and damages are suffered or sustained by the Town directly or by its employees, licensees, agents, engineers, citizens or by other persons or corporations, including any of Contractor's employees or agents who may seek to hold the Town liable therefore . This obligation shall be ongoing, shall survive the term of this Agreement and include, but not be limited to, claims concerning non-sudden environmental impairments . The Contractor shall ,loin in the commencement of any action or proceeding or in the defense of any action or proceeding which in the opinion of the Town constitutes actual or • threatened interference or interruption with the Town 's rights hereunder, including all appeals which, in the opinion of the Town, may be necessary . B. Contractor shall procure and maintain the insurance described in Section A of the Solicitation for a period commencing on the date of this Agreement and terminating no earlier than one year following termination of services under this Agreement . All such insurance coverage shall name the Town as an additional insured and shall provide that the coverage shall not be changed or canceled until thirty C30) days written notice has been given to the Town . All such insurance shall be issued by a company duly authorized to transact business in the • State of New York and acceptable to the Town and shall include all riders and additional coverage necessary to insure that Contractor will be financially able to meet its obligations under, APPENDIX A-5 the Foregoing indemnification. C. Contractor shall , For the period of the performance of services hereunder, maintain a Performance Bond in the amount of Five hundred thousand ($500, 000 .00) dollars wherein named obligee is Town of Southold . The Bond shall be in a form acceptable to the Town Attorney and issued by a surety licensed to do business in New York as a surety . VIII . FORCE MAJEURE If either party is delayed or prevented from fulfilling any of its obligations under this Agreement due to any act, event or condition, whether affecting the Town, the Contractor, the Disposal Site or any of the Town 's or the • Contractor 's respective subcontractors or suppliers, to the extent that it materially and adversely affects the ability of either party to perform any obligation hereunder (except For payment obligations) , and if such act, event or condition is beyond the reasonable control and is not also the result of the willful or negligent action, inaction, or Fault of the party relying thereon as ,justification For not performing an obligation or complying with any condition required of such party under the Agreement, the time For fulfilling that obligation shall be extended day-by-day For the period of the uncontrollable circumstance; provided, however, that the contesting in good faith or the Failure in good faith to contest such action or in • action shall not be construed as willful or negligent action or a lack of reasonable diligence of either party . Subject to the APPENDIX A-6 Foregoing, such acts or events shall include the Following: Cl) an act of God (but not including reasonably anticipated weather conditions For the geographic area of the Town or Disposal Site) , hurricane, landslide, lightning, earthquake, fire, explosion, flood, sabotage or similar occurrence, acts of a public enemy , extortion, war, blockade or insurrection, riot or civil disturbance; (2) the failure of any appropriate federal, state, county , town or local public agency or private utility having ,jurisdiction in the areas in which the. Transfer Station or Disposal Site is located to provide and maintain utilities, • services, water and sewer lines and power• transmission lines which are required for the operation or maintenance of the Transfer Station or Disposal Site; (3) governmental pre-emption of materials or services in connection with a public emergency or any condemnation or, other taking by eminent domain of any portion of the Transfer Station or Disposal Site; and N) the presence of hazardous waste upon, beneath or migrating From the Transfer Station . It is specifically understood that none of the Following acts or conditions shall constitute uncontrollable circumstances: (a) general economic conditions, interest or inflation rates, or currency Fluctuations ; (b) the Financial • condition of the Town, the Contractor, any of its affiliates or any subcontractor; (c) union work rules, requirements or demands APPENDIX A-7 which have the effect of increasing the number of employees employed otherwise increase the cost to the Contractor of operating its haul operation or the Disposal Site (d) equipment Failure; (e) any impact of prevailing wage law, customs or practices on the Contractor 's costs; (f) any act, event or circumstance occurring outside OF the United States, or (g) any change in law or in the permit conditions or status of the Transfer Station Disposal Site or alternate Disposal Site . IX . SUBCONTRACTS Contractor shall not enter into any subcontracts in connection with the services to be performed by Contractor • hereunder without the prior written approval by the town of such subcontracts . All such subcontracts shall make express reference to the terms and conditions of this Agreement and shall obligate the subcontractor to comply with all applicable Federal, state and local laws, ordinances or regulations relating to the services to be performed under the subcontract . In the event the subcontractor is required to Furnish any insurance or bonds For the benefit of Contractor, the Town shall also be named as an additional insured or obligee . X . PREVAILING WAGE RATES Contractor agrees to comply with the provisions of the New York State Labor Law relating to the payment of • prevailing wage rates to the extent applicable, or the applicable State Law in the state of disposal . In the event that at any time during performance under this Agreement the Contractor is APPENDIX A-8 required to increase the wages paid to any of its employees as a result of such requirement, all costs resulting there from shall be borne exclusively by Contractor . XI . FORCED ACCOUNTING In the event the Town directs the Contractor, by written authorization signed either by the Town Supervisor or Town 's Solid Waste Coordinator, to perform additional services beyond the scope of those described in this Agreement, the Contractor shall be compensated for such additional services on the following basis: TOTAL COMPENSATION FOR ADDITIONAL SERVICES DIRECT LABOR COST + DIRECT MATERIAL COST + OVERHEAD + PROFIT For the purposes of this Section: A . DIRECT LABOR COST shall :include hourly wages, including overtime premiums actually paid plus the following fringe benefits associated with those wages - group medical , group life insurance, pensions, FICA, uniforms, safety equipment or special tools . These fringe benefits shall be separately identified and shall not duplicate fringe benefits paid in connection with work performed within the scope of the Agreement . B. DIRECT MATERIAL COST shall be those costs actually paid by Contractor for materials utilized by Contractor in performance of the additional services . The costs for such materials shall not include sales tax for any materials which constitute personal property incorporated into the structures, APPENDIX A-S 7,4 • buildings, or real property of the Town since such personal property is exempt from taxation under Section 1115 of the New York State Tax Law . C. OVERHEAD shall be 10: of the total of the Direct Labor Costs and the Direct Material Costs . D. PROFIT shall be 5% of the: total of the Direct Labor Costs, the Direct Material Costs and the Overhead . XII . CONTRACTOR 'S OPERATIONS AND PROCEDURES REPORTS Contractor will provide the operating plan and supporting data listed in Sections A and B of the Solicitation to the Town for review and acceptance . Contractor will update the plan as necessary and furnish copies of those updates to the Town . XIII . DEFAULT In the event the Contractor, fails to perform its obligations under the Agreement, the Town may terminate the Agreement, procure the services from other sources and hold the Contractor responsible for any costs incurred . The Town also may deduct such costs from payments owing to the Contractor, and/or- draw nd/ordraw upon the Performance Bond as full or partial reimbursement For such excess costs . The Town reserves the right to terminate the Agreement for gust cause . XIV. SERVICE AGREEMENT The Contractor shall be obligated to provide the • Town with disposal services without regard to the permit status of its Disposal Site . In the event that Contractor submits a Bid APPENDIX A-10 • I fOF L3 Si5pomi 5itn POP which Contractor doe:g not currently have all necessary federal and state permits , or which after the acceptance of the Bid loses its permitted status, Contractor shall , at its sole risk and expense, be responsible for obtaining and/or renewing its permits or providing the Town an alternate Disposal Site at no additional cost (disposal plus any additional hauling) to the Town . The parties agree that this is a Full service Agreement and Failure of the Contractor to provide the identified Disposal Site or acceptable alternative Disposal Site, on or after the commencement date shall constitute a breach of this Agreement . The Contractor accordingly shall not be excused • From its obligations hereunder by reason of any failure to obtain or maintain its permits at the identified Disposal Site . XV . LIMITATION OF FUNDS The Contractor agrees that this Agreement shall be deemed executory only to the extent of the funds currently available for the purposes of this Agreement and that the Town incurs no liability beyond those available by authorization of the Town Board as of the date of this Agreement . XVI . DI5PUTES/ARBITRATION Any disputes between the parties to this Agreement may be referred to arbitration by mutual agreement of the parties . Absent such an agreement, any actions or claims by either party hereto shall be commenced in Supreme Court, Suffolk County , New York . In the event the parties agree to arbitrate a APPENDIX A-11 • dispute, such arbitration shall be conducted in accordance with the rules of the American Arbitration Association . In no event shall any demand for arbitration be made after the date when institution of legal or equitable proceedings based on such claim or dispute would be barred by the applicable statute of limitations . An award rendered by arbitrators following any such arbitration shall be final and judgment may be; entered upon it in accordance with applicable law in any court having ,jurisdiction thereof . XVII . MISCELLANEOUS A . This Agreement shall be governed by the laws • of the State of New York . B . Contractor shall not assign, convey or otherwise transfer its rights or obligations under this Agreement without the prior written consent of the Town . C. This Agreement, including all Exhibits and documents referred to herein, along with the Specifications, Solicitation and the Bid, and all Appendices and Exhibits thereto, represent the entire agreement between the Town and Contractor relating to the Services to be performed hereunder . This Agreement may be modified only by written agreement of Contractor and the Town . D . To the- extent of any inconsistency among the documents constituting the agreement of the parties, the priority • among those documents shall be: 1 . This Agreement; APPENDIX A-12 t K) �,f J��k J�F2F. q K1T 1�,^ 'i•�#�.' .}�.�i �y5^( • 2. Exhibits hereto; 3. The Solicitation including Appendices; If . Contractor's Bid. E. Without limiting any other right and/or remedy which the Town may have at law or under this Agreement, if the Contractor is adjudged bankrupt or makers an assignment for the benefit of creditors or a receiver is appointed for the , t Contractor or any insolvency arrangement proceedings are instituted by or against the Contractor, the! Town may terminate 41 this Agreement . F. Contractor agrees that it will conduct itself • consistent with its status, said status being that of an independent contractor and, Contractor, its employees or agents will neither hold themselves out nor claim to be an officer or employee of the Town of Southold nor make claim to any right accruing thereto including, but not limited to, Worker's Compensation, Unemployment Benefits, Social Security or, retirement membership or credit. G . If any provision of this Agreement shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such provision shall not affect any of the remaining provisions of this Agreement and this Agreement shall be enforced as if such invalid and unenforceable provision had • not been contained herein . H . Contractor agrees that it shall not discriminate APPENDIX A-13 +h�.. i{ M:.�SI 4 �} rill Si,+#•: • and that it shall cause there to be no discrimination against any employee who is employed in the work, or against any applicant For such employment, because of race, religion, color, sex, age, marital status, handicap or national origin in any manner prohibited by the laws of the United Staters or of the State of New York . These requirements shall include, but not be limited to, the following: employment; upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training. XVIII . NOTICES . All notices required to be given hereunder shall be made in writing by first class mail addressed as follows: APPENDIX A-1`t If to the Town: Supervisor of the Town of Southold Town Hall 53095 Main Road Southold, New York 11971 With a copy to: Solid Waste Coordinator Town of Southold 53095 Main Road Southold, NY 1 1971 If to the Contractor. • IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and yecr first above written. TOWN OF SOUTHOLD BY: Jean W. Cochran, Supervisor BY: • APPENDIX A-15 Waste Management of New York 123 Varick Avenue Brooklyn, New York 11237 A Waste Management Company Phone 718 .7900is 718/6281628.7090 May 22, 1997 Office of Town Clerk Southold Town Hall 53095 Main Road Southold,NY 11971 RE: CONSTRUCTION & DEMOLITION DEBRIS (C&1D) HAUL-DISPOSAL SERVICES SOLID WASTE HAUL AND DISPOSAL SERVICES Gentlemen: • WM of New York, Inc. has the following comments regarding the Contract: 1. Requirement for appropriate screening measures to make sure that other waste types are not delivered. Town should be held responsible for any cost incurred in separating and/or disposing other waste types. 2. At the end of Section II the language "and Contractor's response" should be added. 3. In the 6th line of Section V after the word "Town" the language "after notice to Contractor and opportunity to cure" should be added. 4. To the end of Section VI(A) the following sentence should be added: The Town has warranted, however,that Contractor will receive all construction material and/or demolition debris, solid waste(whichever applies) received by the Town. 5. In the 7th line of Section VII(A) after the word "Agreement" the language "in a negligent manner" should be added. x DCA Lic.#0928527 DCA Lia 10928528 R a division of VJM of New York, Inc. bi A Waste Management Company • Town of Southold May 22, 1997 Page 2 6. In the 2nd line of Article XIII after the work"may" add "after written notice to Contractor and a reasonable opportunity to remedy the default'. In addition, in the 2nd to the last line after the word "Town" add"subject to the notice required herein". 7. In the 2nd line of Article XVI strike the work "inay" and insert the word "shall". In addition, the entire 2nd sentence of the 1 st paragraph beginning with "absent such" should be stricken. In the event that WM of New York, Inc. is the successful bidder, a mutually acceptable contract will be negotiated with the Town. • Should you have any additional questions, please do not hesitate in calling me at (718) 533-5230. Sincerely, Charles Gusmano Director, Business Development • V�. APPENDIX 6 • NEW YORK STATE DEPARTMENT OF ENVIRONMENTAL CONSERVATION PERMIT • = ental Censeriaticn • New Ycrk State Ce.ar•.men-� .,r Alk Legal Affairs, Building 10 -SUNY, Stany Brook, .NY 117SO-2396 IRMO Telephone: (516) "'-3-9 Iqw Facsimile: (516) 11442=? Nuamd a zsg= Cjmmiafoner ^ • illil -o i� T•ne Honcrable Jean W. Coczmza SuoerAscr, :own of Southold Town Hail :309: 'Viola Road SOLLi:OIC, New Yor> :1197? Ze: lOwn CL .`,CLL:Ci(fS I :_.S:-er C. Dear Sucerisor Ccc�= ?L'ramum To �� OL".:e Sect!-.^-:r =. ICC 1, pe�cn _.d Cr- cf�e:•Lrr Cor..r`issonc ':•:v arc 'v�SLlil'faIL Dt'_ Ni '-4'70, _:C :1C LCCvui 'C711 CL aCt��C�"�, l�'90. ."�.0 3n ex:e^sion. "tee Decal=e_L certcv Jarcves acenzon CI ae:z crr -mer =cn it .ue Cutcacque site 1st:: is ' rr :59-, Were Tuerzv, Cecber 3. :996. Oce^anon at _e 3earr di be e_ in-±e j=±--:n2 Ze_cs` -recared Jv DVirQ is 3ardiucn dale_ Seetemben 393, and m addition, ne TCw,a ==Oiv.WTM _:e :-dowinz oceratine ccammoas: !. iaeTown , cc=,v witii 5 N7C I Suoears 360"•1 -C-=- 360-i : ii:�lsstar Sc�scrs; of 5 _'CZR?_r :cJ i;:eve Occbe' �, :59:1, S-CeC:iC:Lay .==eC T% "Ys aLL::C-,=rCn '_nC ---e -Cwt: _-_.._.'.? Z_^C<< C 71art " _. a OwTI 302a -'Cr -,Cre :v`40S '? ±e :ac-urr =or, 1.111 _ CL BCC Ctanc2 :0 F=S :to%Ii= :=e.5. • /eC:OCs" _��t. -Ic :CCr-'. - ''.:e :.w-. ism*=:cr.=� :o _- -- �e `a�i�; -.;=s _.e c•._� .. — ._ -. . se;ea �� ws . The Town is proiubited zom .MVMZ at :his raciiiry„ aar_rdous wase as dezr=- :n 6 INCRa Pr 371 or:em int d medical wase as deEne d in 6 NYCZR Part 360. • =pprovai ,rust be granted n acvance in wr=a by the Regionai Saud Was-,.- .o aseto accent aon-aazardous mdu=iai waste at ="e fac rv. 6. The Town snail apply mr and reeve a permit :or the; transter ration be:ore the e.,piratian of his temporary authonzarion. i. The Town mus submit by December 31, 1996, to the Depe= `cher 1.)a request for Part 360 registon approval for the subject transfer ibeliry, or, 2.)aa imnleme:rztion scbeduie for the preparation, mbmtrral and obtaui inv of a decsea by d:e Depar=em on a remit for the subject azas.'er ochry. In the event the (later is submitted, it may, if determined by the Depar=ent m be appropriare, result in a iurmer pension of this temporary authoti=ica. la ao event, however, shail such e.-eenspn acceed October 3, 1997. T'ais aurhoriz_tioa is cpnciconed upon rle Town's ,-rict adherence to the conditions as outline_ above and Eur-- to do :o may c�,ut m a nerocarica of this ai:thor.=ion. Vey';,iv''rauu f i ` (4�`1 Recioeai Dire-cr REC,N(EC'mhs =nc. cc. T_. Riiev Cava tiL Carenriere ' A'..LL°v4�V.71�72E • APPENDIX B-2 l t f , 1 1 1, 1 t 1 , APPENDIX C • Town of Southold Accident Report TOWN OF SOUTHOLD ACCIDENT REPORT Date of Accident: Time of Accident_ —AM/PM Oral Report By: To: Date: _/_/_ Sime: AM/PM Location of Accident: Brief Description of Accident: • Check if continued on separate sheet Action Taken: Additional Action Required & By Whom: Date of this Report: _/_/_ By : Department: ANY POLICE REPORT PREPARED RESARDIN6 THIS ACCIDENT MUST BE ATTACHED . Forward Accident Report to Solid Waste Coordinator Southold Town Solid Waste District • P .O. Box 962 Cutchague, New York 11935 APPENDIX - C I • APPENDIX 0 Town of Southold SWMP (Executive Summary) • S.0 SUMMARY plan lSvl0l for This is a Summary of the update to the Solid Waste �Tanagement the Town of Southold. The Town's initial draft Swap was adopted by the Town Board on September 25, 1990, and a final SWMB on January 22, 1991• Since the adoption of the -4", there have been a number of changes in solid waste management in Southold and on Long Island. The update to the TWMP has been necessitated by several factors, including waste generation, recjcling initiatives, regulatory car changes in solidt-tents, and available caPac_ty at other solid •,caste facilities combined with changes is the cost of out-of-Town handling and processing by the prorate sector. These factors have =esulted in a change in the Town's preferred processingalternative for the residual waste remaining after reduction, reuse, and recyc_'i_g. S.1 Town Setting • The Town of Southold is a viral town of approximately 54 square miles located in eastern Suffolk county an Long Island. It is bordered by -e ?-conic Bays enc Gardiaers Bay to the south, and the Long Island Sound to the north. The Town, comprises the :Torts Sothe along with the Town of !overhead to the west, Island, a "Hast :nd" of Long Island. It also includes the Hamlet of ?fishers � small island community covering aPProximately four square miles. The Town supports a large agricSl.ural community, as Weil as a seasonal tourist population and a number of weekend/part-tiZre residents. Cf the var=nus _=r located communities in the Town, the larger residential areas are pr�ar Southold, C chogue, Greenport, and lattituck. The Town possesses diverse ecological resources including beaches, bays, estuaries, lakes, freshwater and ti.'al wetlands, and the upland anvirnnment. These resources are the =--suit of intimi physiology and exist4 g development oatteTs, and are important :or tae:r areserratianal, social, aesthetic, and recreational value. The ?Own comprises 5.38 cf Suffai:c County' s land area, but only 1.58 of the aunty' s population. The la=gest single land use la the ^_own is vacant '_and • •-- Mew SUMMARY-11 APPENDIX D effort are: o Newspaper o Plastic containers o Major household appliances o Metal containers o Bulk Metals o Household hazardous waste o Clear glass o waste oil o Leaves o Green glass o old clothes o Brush o Brown glass o Batteries o `^food chips o Ti=es o Mixed Paper (other than cardboard) o Cardboard La accordance with itsolid waste management p lanniag efforts, the Town has -� implemented a mandatory curbside recyclable col.lection program f__ those residents whose solid waste is collected by carters. Residents that use carters are required to separate green, brown, and clear glass, plastic (HOPE =1 and =21 , tie and alumi=um (commingled) , newspaper, and cardboard. Collection of • recyclanles from customers =s curr=_nt'_y performed once every other week. Collection by Town pe_r=ittad carters is provided for residential, commercial, institutional, and industrial csstcmers on an iad_^r-dual contract basis. Commercial, inscituticnal, and industrial waste generators can also deli-rer their own wastes to the lands:__ provided they are permitted by the Town. Residents may also drop o:'_ their wastes at the solid waste complex with a pe_r3it. .t is estimaced that approximately 107 tons per day of mun-icipal solid waste was generated in the Town in 1992. This volume is cased on 1992 scale house data from the solid waste complex and includes recycl.ables. e'uture waste stream projections have been formulated based on the _992 data and weighted populatiza estimates through the year 2015, and are as fo Paws: year Tons per day 2 ns per near 1989 123 44,895 1992 107.7 39,313 i995 _28.0 46,194 2.00 115.2 48,995 2005 144.1 52,583 27:0 1:4.4 5a,3o4 • 2cis i155.30,348 i"a2R;4 .Z 'TOM Spm..-3 S.3 Alternatives In for=l.atin4 the Town's or-ginal Plan (final SSW January 1991) , a number of alternative processing methods and implemencatioa altar-natives had been evaluated. The alternatives have been reconsidered in terms of eavi.rptmental soundness, applicability, effectiveness and cost, and are Presented in this SWI-0 update. They include: o Wasta Reduction o Land Clearing Debris Recycling 0 Household Hazardous Was o Waste-to-Energy Reduction/Recovery Removal o Municipal Solid Waste Compost.n4 o Materials Recycling o Landfill Disposal 0agricul:ira'_ and '-card Waste o Clean ?:ill Disposal Compest�ng o Methods Of ?rocess:ag/Disposal of o Construction and Demolition Other Wastas Debris (c&o) Recycling Although the State has sec a goal of 50% reduction, reusa, and recycling as o£ the a henc:aarc = resource rscoverr systems, it has been cont) ded as Par- • updated pian that, given the c:a'acteristics of "its waste stream, the Tows could target a redact_n/reuse/reccscl--_4 (including costing) gcal of approximately 70%. The alta^aci-res that were previously evaluated in the original STAMP for long-tern processing or disposal of the residual Portion of the waste stream were: 0 Continued landfillling (no longer an altartative within the Town) c Use --Z- a new, double-lined Town landfi'-1 adjacent to existing landfill (no longer a viable al=arnacive) c Processing ac the Brookhaven composting-energy recovery facility (has noc been implemented at this time) 0 processing at Huntington energy recovery facility c ?rpcessin4 at Babylon energy recovery facility 0 ?recessing at an is-Town mixed solid wasta (M.T41 cpmpcsting fac:-.:y (no longer a viable alternative) 0 yard waste exchange arrangement with a town having an energy recovery 0- -aci'-icy (re-evaluated this past year Orth the towns Huntington/Smithcownd ?ri-race sector pro (includi=g pessihle use of Hempstead's existing energy recovery facility andrecently proposed • v -race sector facia'-cies) - ong haul a another £accc_:y (component of :amporary :ranstar ocerst_ons) SWMP SUMMARY-5 recovery system. ware 7 due^an waste reduction refers to the reduction of solid waste Prior to disposal. This is an important consideration since it may affect the sizing or magnitude of individual operations and facilities. Reduction of the valume of waste could be achieved through Town support of legislation and other i itiatives that aim to encourage residential, commercial, industrial, and institutional establishments to reduce waste generation at the source or point of packaging. This would effectively reduce the volume of waste '_'sat the Town would need to make provisions for with regard to collection, processing, disposal, administration, and financing. Regarding the legislative aspects of waste reduction, the Town will continue to support laws proposed by the County, State, and Federal governments gnat strive co: • a Reduce =he volume and type of packaging materials, especiallY those const_-uted of plant- which are assentia'--y nonbiodegradacie, nonreusable, and nonrecyclable a Expand the a,—,--rent beverage container deposit law =o include a wider array of conta_aers o Encourage greater use of recycled materials, or products packaged :-- recycled or recyclable Materials c promota. =he development of household hazardous waste removal programs a assist and encourage industrial, commercial, and iastic:ticnal generators to undertake reduction and recyc'l'ing prog_-ms a assist and encourage homeowners to undertake backyard cpmposting and to leave grass clippings an the lawn "he Town will conti-zue to support legislative efforts =o establish deposits on batteries as a means of reducing the concentration of Decals in various products and residues of solid •aasta processing. Bac--arias constitute an easily removable source_ of potential cnntaminacion from the waste strum. addit�cn =o '_>_gislacive actions, all sectors of ='-e Town (public, commercial, _aduscrial, and :asci=:tcicnal establisnments) will be encouraged Sy • ,. e '"awn reduce TAM sMaUM-7 The materials targeted '-or source separation, curbside calsection, and marketing include paper (newsmaper and corrugated cardboard) , color segregated glass, tin and aluminum, plastics (PHT and BDPE) , and ferrous and nonferrous metal containers. Leaves, brush and land clearing debris are also source separated for the Purpose of composting. in addition, construction and demolition debris, 'shite goods (major household appliances) , tires, and household hazardous waste are kept separate at the collection Canter. As previously discussed, commercial/indust:al toxic or hazardous waste is currently regulated for proper handling and disposal by Federal and State law. These materials should not be handled by the Town and are recycled or processed at private sector facilities. Reyic, "la `Ra'^- Qouse. c d app, 4 anaes As with the iotial S*NMP, the updated ToW's resource r=_cavery system recPnmmenas twat discarded major household appliances (also referred a as *white • goods') continue to he tempera---' lag basis -y stockpiled and tfensfe-reed an a r=gu to pri•rata =S-cycling facilities. shite goods, comprising appro7C.Tata:y 1% of the waste stream, include discarded refrigerators, washing macniaes, driers, saves, etc. Depending on =arkets, _t is possible that =svenues could be generated f=cm this material. 0ecyCl4 -c- Ti-as Adesignated =croon of the solid waste complex is used to temperari'_y stockpile tires for shipment a appropriate reprocessing or recyc-'i=gac'--'_ties• The temporary stockri-e operations should be sized to stockpile up to 1,000 tires at any given time. using an assumed, generally accepted generacicn rate of are tire per person per year f..r the Town's papulation of 20,002, 3pproxisraly year could - re disposal. Alte:3atively, using an esc�ated 20,000 tires per ='4u1- factor for t__es is the ==sidencial waste stream of 0.64 tons per day (based on 1990 scale house data) , with an assumed weight of 25 pounds per tire, an average of approximately 19,000 tires per year would requite Proper dispcsal. Based on these estimates, _t may be necessary to size a ti=e stockpile and t--3nsf'-r operation tP hand-e between 19,000 and 20,000 ':-4=-s per year' This would transfer ar-a gement of apprcximacely 20 correspond to an average annual • shipments pe_ _year ('1.,000 -'a-res per shipment) , cr approximace_y cne shipment- . every ? and 1/2 weeks, with a:_owances fo - r more tw,;uent shipments -:=4-ng-:=4-ng o-r=air Peak Periods. _7 SWMP SII;OULRY-9 ggpvct 'ta Fousehold F»°�^ovs as`z ccnt.k o Gasoline o Spot Removers o Ferbicides o Stain and Varnishes o Kerosene o Wood Preservatives o Paints o Unknown/Unlabeled Containers The resource recovery system in the Town's updated SF[P recommends that the Town work toward implementing an extensive public awareness, participation, and education program designed a provide information on the importance of properly disposing hazardous materials and the procedures to be followed. The Town's S.T.O.P. program is consistent with tb,e New York State Solid Waste Management Plan guidelines since it can effectively help reduce the quantity cf hazardous wastes entering the waste stream. additionally, the S.T.O.P. pragr3m is expected to increase enviran.:.ental consciousness and encourage residents to segregate and recycle wastes rather than discard them. It is estimated that ae_o_roximataly 1% of the '.asta stream will be covered by this element. • ret ' c C nst^ c-' _-- "='"" "-nn nebr_s The development, planning, pe::=itt-ng, and capital cast of a ccnstructian 3ad demolition debris processing ac-:itY is cosz`f:ective is :t is handled by the Ttwn. Conszquent_Y, as w th the initial TOMP _t private sector rather than is recommended in the updated ?!an that this waste no '_anger be accepted at Tcwa disposal facilities, extent on a temporary basis. The reercling/-processing == this waste should become the respcnsibility of the privasa sector, as is the case in most Towns on Long Island. This would 'help to maximize the efficient! of recycling this material. Concrete, rocks, bricks, asphalt, t-umber, and pallets are among the components of C:= debris that can be -processed and recycled. It is estimated that apnroximacz_Y la of the waste stream is comprised at commercially generated canst_act_on and demolition debr'_s that ccu'_d be recover=_d by this Plan element. Consz=.ct•_n and demolition wastes from residents and contractors are handled in the same manner. • C? I APPENDIX D • Town or Southold SWMP (Executive Summary) • S.0 SM*iARy This is a Summary of the update to the Solid Wasts Naaa4emenc Plan (Soi4) far tae Town of Southold. The Town' s initial draft S.wMP was adooced by the Tow•r. Since the Board on September 25, 1990, and a final SW,W on Sauauary 22, 1991. adopt on of the SnTLa, there have been a number of changes in solid waste management in Southold and on Long Iaiaad. The update to the S,QMP has been necessitated by es, regulatory eseveral- factors,coastraiacsg changes is sold waste generation, rec!clin4 initiatives, regu_ and availablz capacity at ocher solid '.caste facilities combined with changes is the cost of out_of_T.cwn aanot _:Ig and processing tY the pr-pace sector. These o -d nracess_ag aiternat_•re factors 'nave resulted in a change is the Town's pr_fzrr_ for the res:-Vual waste remaining after reduction. :reuse, and r9cycl_a4• S.'_ Town Setting • The Town of Southold is a -_cal ccwn of approx mately SS thS<Te ?e o les iecaced cascara Suffolk Caunvy on Long island. :t is bordered by '- ?eco Bays and Gardiners Bay cc the south, and the Long island Sound to the north. The Town, along 'lith tae Town of Riverhead to the west, comprises `.e :Tcrth ?ork of t-e 'cast Sad' of Long iBland. it also includes the Ram-let of ?fishers island, a sma__ island community cover:" approximately fou square a 1zs. The Town supports a Large agr_cu__ t `..ral ===unity, as well as a seasonal- dents.residents. Cf t-e various to : urist pccuacion and a number of weekend/part-L_ �`/ 1acacea. aammun___e5 In the TaWn , the Larger residential areas e=9 p=_ rL. Southold, C_tcnague, Greenpor', and Matmivuck. The Town possesses diverse Lakes, freshwater and ecological resources including beaches, bays, zsc.:ar:.as, ` su'_t Of pland envi=orment. These resources are t-e ra tial wetlands, and tae u � or.�c for the== :ay.:=al phys�ciogy and zx:sL_n4 develocment patte^s, and are sp or=_ser-rac_cnal, social, aesL-colt. and recreacior..al value. The Town coa;criszs 5 .3& Of Suffai:c County' s land a=--a, but cr11V _.5A of Lie ?he Largest s_aglland use _n the = r s, •racsnc Land _our c'_' s peculation. • SOW S^u�SARy_= APPENDIX D eiLorz are: o Newspaper a Plastic containers o N:i;or household appliances o Metal containers o Bulk Metals o Household hazardous caste o Clear glass1o Waste oil _ o Leaves o Green glass o old cloches a Brush o Brown glass o Batteries o Wood chips o Tires o Mixed Paper (other thea card:oard) o Cardboard 'n accordant with ics solid waste mar ement planning extorts, the own ..as imnlemer_cad a mandatory curbside racyclable collection program =or thcse residents •.rhosz solid waste is coi_actzd =y carters' Zes_dents chat use carters arm_ r=cu red to separate greenorown, and c'--ear glass, plasms c (BDPr i1 and s2: , tin and aluminum (ccmmingledl , newspaper, and cardboard. Collection ct • r=_cyclables _ram customers is per:craed once every ocher week. Col' ec-icn :-y Town perm --- ictad caars is providad cox residential, acaznerc_al, 4_ndividual contract bass. insc� tucional, and iadustriai customers on as Commercial, -nsc= tucicnal, and industrial waste generators can also deliver their own wastes to 'and--i-71 p :he -anti -' -Zv'- ded they are pe_rmi.tted by the Town. Besidenz-3 may also drop c-= their wastes ac the soi-'d waste complex with a pe--=Lic• Ls asc=acad that anproximacely 107 cons per day c= ==n.czpal sa1_d waste was generated the Town in 1992. This rolume cased = '_392 scale '--cuse rata ',-cm the so'lld waste complex and ihcludes ree!clables. ?uture waste stream pro;ecticns :ave been formulated based an the 1992 data and weighted =cpulat_on est maces through the _year 2015 , and are as '_ollaws: T-..a nr year y.ear Tans her day n- _989 123 44,395 aa� 107 .' 39,313 gag -25. 6 So, 194 -COO _35.2 38,995 2705 135.': 52, 5x3 ,,_3 .55.3 56, 364 r - '_55.3 50, 358 Tom Smamay-3 • s.3 alternatives in formulating the Town's original Plan (final S'OW Sanuarl 19011) , a number of alternative processing mechcds and Lmplemencacien alternatives had been evaluated. The alternatives have been reconsidered in tars of environmental soundness, applicability, effectiveness and cost, and are presented in this SOW- update. They include: o Waste Reductica o Land Clearing Debris Recycling o Household Hazardous Nasty o Nasta-tc-=aergy Reduct4on/Recovery Removal o tivaic- al Solid :.ante Composc.ng o wacerials Recycling o Landfi'_l Disposal o >g==c•-"•.:=a1 and Yard :.iasce o Clean '=11 -acessi-g/Disposal of Compcscing a Het_cds of o construction and Demolitioa Cther :tastes Debris (C&M Recycling althcugh the Staca has sec a goal of 50% reduction, reuse, and re(Zrc'_ing as a =eseu=cs recovery systems, it has been conc_zded as ?art of the hers: a-c __r • - • updated p;an t:at, given the ca-acceristics of waste stream, the Tow-,' cpu_c ta=gec a ret ct_n/=ease/reercl__g (including Compost 70%. goal of apprximace_y 08. T e a_te^ac_-res that,h were previously eval:racad La the original SdM.P fcr Long-term ?rxessing or disposal of tie residual portion c. the waste st=eam wer=e: o continued landfilling inc ?pager as alt_::-native wit"- -the Town) e Landf:-- Jse cf a sew, double- l=ed Town landfi1_1 ad;aceac to x_st_ng (no -anger a •r-able aaaraac-:re) p-ocessi_g at the 3rcckhaven composting-eaer,y recovery faciliry lhas acc been mpiemencad at this t4-e) o ?rocssaing at Huncingccp energy recover! tacility Processing at Babylon energy recovery c processing ac an in-Tcwe meed solid •,waste (:ZSD11 corrresting `_ac._.-! (no lcnger a viable alte-^_acive) one_ recovery Yard -waste exchange a=rangemenc with a town having an _..e rgY ret _is year Vic toe towns _act :[ (re-evaluated t past Huntingtca/Sal chcown) raspy (including tcss_._e use tf �- >_ca sector troceesingrn . - . :r or^pesed ner'v recovery [acc._ty and ==cent _ :emtstaad' s exit sinS - >_ _-race sector -acz__t_es) • . cmccnent of temts=' trans rang hau; _o anocner tac_ t ( :peractons) fer recovery system. Ieduc-'on Taste reduction refers to the reduction of solid waste prior to disposal. This is as important consideration since it may affact the sizing or magnitude of individual operations and facilities. Reduction of the val.^=e of wasta cou'_d be achieved through Town support of legislation and ocher ititiat_ves that aim to encourage residential, commercial, industrial, and institution: establishments to reduce waste generation at the source or point of packagimg. This would ef-ectively reduce the volume of waste that the Town would need to for with regard to co1'_2ct4oa, processing, disposal make provisions admia4str3cioa, and financing. t^e Town wi'_: continue Regan-,._:.G `the legislative as- = of waste redact-ca, .. the Coua State, and Tederal governments tY, to support laws proposed by strive to: " e of packaging materials, esp c RedUC3 _ ecially those na vo.,ae and is ocnb_odegradable, coast- =•:tad cf plastics which are 25:i 2C C_3__: ooareusable, and nonrecrclabla c !xr-and t'-e cl==eat beverage container deposit law =o include a r der array of containers oof recycled materials, or produc--s packaged In -ncourage greater use recycihd or recyclable macer_a'_s promote =he development of household haze:`=pus wasca removal =r--g--3=s Assist ..d encourage nduscrial, ccmozerc:al, and _nsti=nticra_ generators to undertake_ re, uc--ion and rec.!clizg pr_gr— o lss st and ancpu-age homeowners to underta;t2 'mac.eye=d ccmpostinS had =- leave ass clippings on the lawn The Town -, '_ r_ _ continue to supper-- legislative efforts o testablish decosi s the concenr_racicn of _eca_s .a -ra=_pus on hate=_ries as 3 means of reducing , orcduc=s and r=esidues of sciid waste process'-Z-9. 3ac=eries coos--:=uta as has:_'zl removable sou=th of pOcecc43l contamlaat_on =rom =he waste stream. � - sectors of =e Town ;--_un1i_. __g_s_ac_:e act_^.ns, _ 3 _ • =i= :3 oe encouraged =! _ s _ _CCd25t3b1ial3ePC w--- ==emand • __e -ow-n zz reduce The materials targeted ...r source separation, c,--!:side co'_:ectiOn, and marketinginclude pacer (newspaper and corrugated cardboard) color segregated glass, tin and aluminum, plastics (PET and BDPE) , and -arrous and aca`er='us metal containers. Leaves, brush and Laad clear?ng debris are also source separated for the purpose of composting. In addition, construction and demoliticn debris, white goods (major household appliances) , tires, and household hazardous waste are kept separate at the Collection Canter. as previously disc'assed, commercial/indust=-a1 toxic or hazardous waste is cur=eac`_y regulated for proper handling and disposal by Federal and State law. These materials should act be handled by the Town and are recycled cr processed at private sactor facilities. ecyc p' Wa4-- Yppeui.c_d appl`a_nces As with the i—tial S8N?, the updated TWF?'s resource recovery system recommends that disci ded mater household appliances (also referred to as •white goods*) retinue co be temporarily stoc!cpi-ad and transferred on a =egular bas-s • - facilities. Chita goods, co®r'ising approximac=_.y 19 of can a pr:Tate = cie'_inS =_ a -dash; machines, dryers,s, waststream, include discarded - f=igerators, ecc. 0eperding on -a=rets, :t :s possible thatrevenues could be ;eneratad stoves, from this material. T:-a5 A designated - rtion of the solid waste comp-ex is used to tempo===.Y stpckpi-a tires car shipment tc appropriate =eprocassing pr recyc! " -ac-it_es. ons should be sized tz scccigi-a up tc 1,000 c-r The temporary stock;-4-16e cperaci 's sumed, generally acxapted generation rate of one at any given time. Using an as rite per person per Year t=_ the Towns population of 20,002, apprpxi=ac'__y 20,000 tires per year could =_quire disposal. ?.lternatively, usi.S as estima.c=_= factor for te=as __. the residential waste stream oc 0. 54 tans per day (basad cn weight of -5 pounds per ter', an average '?90 scale house :tical , with an assumed S - of apprsximacalY 19,700 ._res per year would requ-re proper dispcsal. Based cn be necessar• tc Sze a __=e stcckpi' a and these =estimates, it may ! s e per year. This wcu_t operac-cn to aandla between '_9, 700 had 20,700 ter s c__res^ond co an average annual transfer arrargemenc of a:P:=ximata-y _. ^_- vea= (-, 000 ter=_s per shipmentJ , ..r approximaca-y cne shipment sh'^me..-- per - - _ •,ret.. -__=wanes _or more _r=tueac shipments terra_. every ' and '_/2 weeks, peak periods . J_ TOW sIIIe"Y-9 Recrctc Rouszhota �" -'cus Has'> �c^rt. l a Gasoline o Spot Removers o Herbicides o Stain and Varnishes a Kerosene o ''Rood Preservatives 0 Paints o unknown/Unlabeled Containers The resource recovery syscam n the Town's updated TAW reccmmends that the Town work toward iagplamentisg an extensive public awareness, participation, and education program designed to prvide informatiea on, the importance of proper_,/ disposing hazardous materials and the procedures to be followed. The Town's S.T.O.?. prcgram is consistant with the Yew York State Solid iiasca wanagement plan guidelines since it can effectively help reduce the quantity c. :azardcus wastes entering he waste scream. acditionai'_y, Che S.T.O.?. pros=� is expected to increase envirnnental ccnscieusness and encu--age residents segregate and recycle Wastes rater than discard them. it is estimated the= approximacaly 1% of the ..asca scream will be covered by this element. e The development, plan^_ng, =a ni:ming, and capita'_ case of a ccnst--C-- on a d � � --e demolition debris pncess ng fatil:_! ''-s cost-effacti re :_ ct is hand-_d by c,.r.. Cons enc''_y, as -.r th the initial S-a a private sector rather than the T r ?tom this longer be accept at -ow- s r=_cc�encec is toe arca[__ that s wast_ :.o ons ' es, except on a camporarl basis. The rePlCli - ng/prOc2ssng =- disposal =acilit_ restcasibiliC of the privaca sector, as :s one case this waste should become =-e ! - _h a `' ' on r c iould 'eel co aaz-'ii.e a f__c-- c_ - in host Towns on long a_anc. ?his p , ecs rsce, racks, bricks, asphalt, '-umber, and pal- recycling this material. Coac are among the cc=cnents of CS.O febris that can be prccessed and reclrcled. __ s estimated that approxaca.r 1.3 of the '.2Lsta stream is ctmpr_sec cf commercially generated coast=action and damol_tiea '_ebri3 that could be reccverac by this ?tan element. Consc=_ccicn and demolicien wastes from rssidencs ar_c contractors are andled in the same manner. • i::c7;, «ZL� SJl4SARy-11 OVERVIEW OF TRANSFER STATION OPERATIONS CUMULATIVE WASTE SUMMARY THROUGH DECEMBER CUMULATIVE RECYCLING SUMMARY THROUGH DECEMBER 1996 • APPENDIX E • OVERVIEW OF TRANSFER STATION OPERATIONS 1. DESCRIPTION OF RESOURCES No changes to the District's funding mechanisms or management structure is anticipated at this time, although development of a long-range plan for the District is now underway. 2. WASTE RECEIVING AND TRANSFER The Town transfer station operates under a temporary permit from the DEC (pending approval of plans for a new/re-designed transfer station). It receives municipal solid waste generated within the Town by residential and commercial sources. Approximately 10,000 tons are received annually. The waste is delivered individually both by residents and small commercial contractors bringing their own waste (self-haulers) as well as by commercial garbage carters. All waste to be transferred is deposited into a cement pit, or trench, inside the existing collection building where it resides until the long-haul trailer(s) arrive to be "live-loaded." The trench can hold) approximately 300 cubic yards of waste. Permit conditions require all waste to be removed within 48 • hours of being received. Upon arrival and weighing at the scale, transfer trailers drive in a temporary loading "slot" located outside the collection !'building approximately 75 yards from the trench containing the waste to be loaded. The transfer trailers rest on an asphalt surface approximately 4 feet below the loading grade. All loading is done with a front end bucket loader fitted with hydraulic clamps to grab and hold the garbage. Waste is packed, or pressed down, into the trailer by the payloader bucket. Once filled with waste, the transfer vehicles pulls out of the slot and proceeds to the scale to be weighed. If too much weight is on the trailer, the truck will return to the loading slot where the payloader operator will remove enough waste to bring the truck to a legal weight. If more waste can be accepted, the operator will add it to the load. Upon being properly loaded, the truck will "scale out," receiving a weight ticket, and pull off to a convenient location where the driver will tarp the load. PLEASE NOTE: The New Transfer Stations Currently Being Planned Will Allow for Indoor Loading and Tarping of the Waste. The Town Anticipates • Construction of the New Station Will Be Completed Sometime in '1998. Appendix E • 3. RECYCLING OPERATIONS a) Following is a description of key elements of Southold Town's source separation and recycling program. 1. Procedures for implementing the current program. Collection Methods. Recyclables are brought to the Collection Center in two ways: a) self-hauled by residents, and b) hauled from curbside by private carters. a) Self-hauled recyclables are accepted during the Collection Center's regular hours, 7:00 am - 5:00 pm, Monday through Sunday. Self-haulers deposit the following items at the recycling drop-off station: 1) glass bottles separated by color, 2) tin and aluminum cans into separate 2-cu. yard containers; 3) plastic containers; 4) polystyrene (PS)(#6 plastic); 5) mixed paper; and newspaper (ONP). Corrugated cardboard is also accepted, but at an outdoor "bunker" away from the main recycling drop-off station. The glass is deposited into 2-cu. yd containers. When full, the • glass containers are carried via forklift from the drop off station to roll-off containers located at a below-grade storage area outdoors, approx. 60 feet to the north of the main collection building; the tin/aluminum cans are brought to an outdoor "bunker (a 30' by 40' paved area enclosed on 3 sides by movable concrete block walls 4' in height); the plastic is hand-soiled to remove HDPE and PET containers, which are then baled in one of two small vertical downstroke balers. The remaining plastic consists of a mix of#2 color containers and other miscellaneous plastic. This mix is removed in a container via forklift and dumped in another outdoor bunker; the PS is placed into bags set up in one of two PVC frame bins at the drop-off station. There are separate PS bags for"peanuts" used in shipping packages, block used to pack electronic equipment, and food service containers. Mixed paper is dropped off into 4-cu. foot size gaylord boxes, which are then loaded via forklift into a van-type trailer for hauling to the recycter. Corrugated cardboard is deposited in an outdoor "bunker to hold until there is enough to load an open-top trailer for hauling to the recycter. The corrugated bunker is shared with carters bringing in corrugated from curbside. ONP is deposited • into small carts used to transport the paper to roll-off containers stationed at the outdoor storage area. The ONP is then hauled out under arrangement with a private firm. • b) Private carters deliver source-separated curbside recyclables consisting of all the same items as self-haulers, with the exception of polystyrene (#6 plastic). The glass bottles (also separated by color) are delivered directly to the roll-off containers at the bi-level drop area; the tin/aluminum cans, plastic containers, and corrugated cardboard are brought directly to the outdoor "bunkers" that were mentioned above. the curbside plastic comes in at too fast a rate to allow it to be sorted to extract the valuable HDPE and PET. It is merely loaded loose into an open top trailer for hauling to the recycler. The haulers bring mixed paper to the same gaylord boxes used by the self-hauling public. They bring ONP directly to the roll-off in the bi-level area mentioned above. Processing Design/Description - The facility to which self-haulers bring their recyclables is a section of a large building (the Collection Center) that also houses an enclosed facility for the residential and commercial delivery of garbage, a mechanic.workshop, and the Center's central office. The main residential self-hauler recycling drop-off area is on a • covered concrete slab 50' by 25, open on one 50' side. It contains containers and bins for the drop off of glass (sorted into clear, green, and brown), plastic, tin and aluminum cans, and polystyrene. It also contains the vertical balers used to bale HDEP and PET plastic, which is separated from the mixed plastic stream by facility staff. The corrugated is deposited at an outdoor bunker that is also used by haulers delivering corrugated from curbside. Mixed paper is deposited. by both self-haulers and curbside haulers, to the gaylord boxes that are lined up along one wall of the residential garbage drop-off floor. Curbside glass and ONP are delivered to roll-offs located in the bi-level drop area; curbside cans, plastic, and corrugated are delivered to the outdoor bunkers. 4. ACCOMPLISHMENTSINEW ISSUES a) The 1996 period saw several significant and unique developments that contribute towards the MSW management goals set out in the SWMP. • 1) Acouisition of Yard Waste Processing Eguioment. In anticipation of receiving ultimate approval of the Town's compost plan, the District acquired the necessary equipment to process and compost 3 • all of the yard waste currently generated within the Town. 2) Enhancement of Source-Separation Recycling Program. The Town adopted a design concept for a new transfer station that reinforces its ability to handle existing source-separated recyclables from both self-haulers and carters, and which provides for future expansion of the source-separation program. This demonstrates the Town's commitment to source-separation as the operating principle behind all of its recycling efforts, and as the means to achieving the recycling rates envisioned in the SWMP. Southold is unique in this regard. 3) Addition of Polystyrene to Source-Separated Recycling Program. Southold became the first Town on Long Island to initiate a Town-wide polystyrene recycling program by participating in a pilot-project sponsored by the American Plastics Council (APC) and the County of Suffolk. Starting in May 1996, the recycling center collected and shipped to a Long Island vendor 3 grades of polystyrene (#6 plastic). Approximately 2 tons of this extremely light material (600 cu. Yds) were collected and moved. One of the grades, • packaging "peanuts," were delivered directly to package shipping outlets for re-use. 4) "Cans for Kids" Program. The Town initiated a drop-off program to collect 5y deposit aluminum beverage cans for use by a local youth environmental organization. We estimate approximately $15,000 worth of these cans are! delivered to the recycling center each year. The Town solicited and received the cooperation of local beverage distributors and sales outlets to accept cans delivered by youths group members who will use the income to fund group activities, which include nature area cleanups, ecosystem study sessions, and recreational camping and field trips. The drop off facility is designed to keep cans sorted into the required brand-name groupings, thus making it easier for the group to redeem them. b) Issues with a potential effect on MSW haul and disposal arrangements are listed below. Item Issue New Transfer Station Town plans to construct a new facility for • receiving and transferring waste and recyclables adjacent to the existing 4 • transfer station. A conceptual design has been approved. Engineering specifications for the new station will be completed by early summer and submitted to the Town for approval and permit application to the DEC. Construction is expected to begin late in 1997. Existing loading pattens will be changed to accommodate construction activities. The Town will work with the contractor in advance to address any changes in loading arrangements, including any effects on the location where long-haul trailers are to be staged for loading or the time or days of week available for loading. Permit for Full Scale Yard DEC approval of plan submitted in 1995. Waste Compost Facility (May depend on ultimate approval of Closure Plan). Town continues with previously approved small-scale composting program as well as volume • reduction of excess yard waste (shredding and chipping) for give-away program or use on-site as ground cover or slope-stabilizing medium. Capping and Closure of The Town is planning to begin capping and Landfill closure operations of the now inactive landfill (which is adjacent to the transfer station) within the next two years. This activity may have minor impacts on SW transfer operations due to increased traffic at the site or occasional diversion of resources to activities other than loading MSW. The Town will notify the contractor in advance if it appears that such impacts may result: in delayed or postponed loading operations. • ovvmanf 5 XxxgXxxxx � € Vega R„ € • o xLL � ds3aRana3=Rs3 a R�R� dtt 3 a a ___ _ --- _-_-----f^-m__-__- �� Sx Xii 4C �:m�¢ pro €x € € % R W � �� I RmdATtt'8801'SgR"' m ?R3� rR R " qLL As %R's-Si2R8 _ ai8=lig ^ 03a _ �^ 1 3 2'S.zo2&9S82s8 R "2A3 15 g 8 3zs SIR- !!goo E■«'8'S«-Rad«8R R Rd33 39 e g m W m a o 0 :8A38RaR8:R== 8 --Rn ^03 8 8 « • U « W = e H Y88-o3A$g'-3od-m ^m aasR R« S 3 - Q.' 219T adman-3s _=da 83 - S N Wo 7348«'e^e 8:888R 8 `aRo n' y a � "s : W S�^,AS83ga8SRR 3 8«82 a ' 7 $ sR�84RR89RR^ o^n J m 8R8-o --o '^ R a gaa_ � 3 .a��g�ea3-Rmm $ naoo n m - to :�833Rna2e B n =mR- ^am$.00. � _ T LL a ase-o$8Ssa«QRS 8 2888 "A S 3jt R ? ; ic n aHIM3J 3 3u3 APPENDIX E 1„DfJ, --- ---- 1996 CUMULATIVE RECYCLING SUMMARY THRU DECEMBER '.-.._.. DELEMBER'00 1 nD xcnryw ------- -- -- ---- I �Toul---_---- %Cn,lp. %Clwrq.From I TOTAL From YTD OCT NOV )Ton F, mNOV DE=5 I TONS 1995 JUN JUL AUG SEP ----JAN FEB MAR APR MAY I I I I IIOIISEI I11,D NLGYQ ING ]B 63 TLO% Is" I 34601 '109% GW.- 61% .691E I .6.01 .15 Bx W.- ZaW 2717 2677 3971 0000 ]173 0996 ]789 3626 233] 252] 1743 -65% -11.1% i 23..]9 -172% C%. 457 200 316 251 192 ]Bl 526 670 680 124 333 1 3.Ix I 18375 15% G.m 1524 1289 1276 1S]0 1743 2253 2686 2837 2515 2138 1965 I 10.13 300% WA I 116 WA 2203 16 Us low 1320 dli 2106 2111 1073 1103 1220 101] IOU I 2241 610% 02% I 25812 240% PWWu 102.8] 8.7% 211% 1 118086 661% PolNlpm! l0W 1625 1849 1521 Hb. 1781 1818 3769 3718 1D 10 1411 13711 388% 303% 1 14773] 730% LuW 9138 5722 6801 704] 11917 8189 12100 0361 IB]2 11]1] 9637 i 60091 I 1100 352% N.x.WWr60 100 00% 00% I 1100 155% Cudw.re W463 13263 Be51]4 HI 10 13231 8121 I9i 56 128 1110 81.0 1Be 100 00% Lu 1.brlW. 160 150 160 1be 160 00 100 100 100 100 100 I 3790 121% 614% I 15573 76% C. 050 050 100 700 00% :4 I 5301 47% 6NMeP.PN 40II 19 IS bB SB 13111 7121 3586 65.6 0165 0 6700 360 1 616 3111% 11.3% I 7235 17x W"dp 162 118 0]B 162 103 826 837 700 721 460 792 638 200 i 300 00% 2370% I 2775 233% W..W Otlllwwl 422 411 701 703 691 04.]/ 278 323 2.50 260 2w W..5W9W 000 000 064 352 38845 210% 7.1% I .72463 2B 0% D IWu..1 aluWl 110445 35411 "3]1]1 44410 41533 33500 We 78 418.11 45767 38556 321.14 O IzT N..ON.1dtl R..]•Iro .oex I 410% ]]6% 414% % Nuu.WM 414% 407% 396% 3% 411% 441% 4 i 1 O O.rb+B•- I 1 X COMMERCIAL RECYCLING I lealW33 -138% 257% I 33174 100% 074 813 3562 2344 80W 4114 3501 2095 12]5 2102 2182 20.]] 3206% 614% I 12146 150% Scup M.W 4]Sp 9)B 1801 1276 1285 1116 1200 911 1]U 1002 9M 404% I 61548 125% F77 TW.. 1p.11 6].1% LwnoowlluW 0133 lbw 5223 41.19 73 15 8300 4055 3039 3453 3170 3128 YARD WASTE RECYCLING 1 1 Mn -131% 611% I 186418 4B 1 loN. 11.]0 .73.7% -6 6% I 142].15 1485% .218 -.0 W 4510 1106 19118 0310 339]6 .2613] 12495 !1116 T]BI 2000 1154 WmoNe .5365 -431% 798 655170 Wood Clq. 30.36 696% 507% 100019 -05.2% abbe Well 16900 124084 00516 30162 9020 11444 61 3043 34621 232.13 364.13 IW41 1 4x ax I 8516.22 364% -r.ngNe 931 407 10960 93:5 U lllntlp - I 1125tl 1062 401 Y5 135093 117882 60573 41326 37283 29000 61583 158.24 I 1 Yue W..W I.W 1 1656.17 .190% 353% i 13787.34 324% GRAND RECYCLING I TOTAL. 54234 44342 72009 233025 1101 Y3 tlY37b W06T 00233 10306 01331 1930 I 1 1 457% 1 AIR,...b4i ..%A 7,00 407,A ]% 354% 448% 510% 248% 376% 311% 252% 32]% 652% I 411% 1 18022 44% W..W W...' I 1550 33.1% W..W O61W9u+) 1155 12W 2085 1926 1620 1655 1075 1232 2170 1475 1390 1 I08 -11 5% 0 0 0 I 18 ......ERR_......._-------_ERR To6.I(.W 65 Y 0 0 3 0 ll 0 21 I..._.._._.__.._ y1Yuw) -NOTE.uledWSS W`Weu..WW&"' %Mujy, COtLE.TEEOO. L.aNs Souc.:Sw.IwM Toon D.PaOAwIY 0 SoWd W.616