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HomeMy WebLinkAbout13 - Approval of Vehicle Replacement Purchase Orders for Three Toyota Tacoma Trucks, One John Deere Wheel Loader, and One John Deere Backhoe LoaderQ SEW Pp�T CITY OF z NEWPORT BEACH c�<,FORN'P City Council Staff Report October 22, 2024 Agenda Item No. 13 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: David A. Webb, Public Works Director - 949-644-3311, dawebb@newportbeachca.gov PREPARED BY: Kyle Brodowski, Public Works Superintendent - 949-718-3464, kbrodowski@newportbeachca.gov TITLE: Approval of Vehicle Replacement Purchase Orders for Three Toyota Tacoma Trucks, One John Deere Wheel Loader, and One John Deere Backhoe Loader /_1 16*1 d:7_T" IF The Public Works Department requests City Council approval to purchase three Toyota Tacoma TRD Off -Road 4WD double cab pickup trucks, one John Deere 624 P-Tier wheel loader, and one John Deere 410 P-Tier backhoe loader. These purchases will replace current vehicles/equipment that meet City Council Policy F-9 — City Vehicle/Equipment Replacement Guidelines criteria. Total costs for the pickup trucks and loaders are $142,925.73 and $471,762.96, respectively, or $614,688.69 combined. RECOMMENDATIONS: a) Determine this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly; b) Approve a Purchase Order for three Toyota Tacoma TRD Off -Road 4WD double cab pickup trucks from Toyota of Glendale, for a total amount of $142,925.73; c) Approve a Purchase Order for one John Deere 624 P-Tier wheel loader, and one John Deere 410 P-Tier backhoe loader from Coastline Equipment of Long Beach, for a total amount of $471,762.96; and d) Authorize a contingency of $30,000 (approximately 5% of total quotes) to cover the cost of unforeseen changes to the current quotes. DISCUSSION: The Public Works Department recommends approval to purchase three Toyota Tacoma TRD Off -Road 4WD double cab pickup trucks, one John Deere 624 P-Tier wheel loader, and one John Deere 410 P-Tier backhoe loader. These purchases will replace current vehicles/equipment that meet City Council Policy F-9 criteria. The Fire Department's Lifeguard Operations Division utilizes this model/package of Toyota Tacoma pickup truck as rescue vehicles on the beach. Their reliability and ability to quickly navigate the difficult terrain while transporting necessary equipment is critical to effective operations, particularly in emergency situations. 13-1 Approval of Vehicle Replacement Purchase Orders for Three Toyota Tacoma Trucks, One John Deere Wheel Loader, and One John Deere Backhoe Loader October 22, 2024 Page 2 The proposed trucks meet department specifications and will replace Unit Nos. 2806, 2807 and 2808. Each of these units entered service in September 2020 and meet the City Council Policy F-9 replacement criterion of four years for beach vehicles and ATVs. The environmental elements at the beach, and the types of use the vehicles are exposed to, deteriorate equipment and materials more rapidly than typical on -road use. This requires more frequent replacement, and the schedule is solely based on age instead of mileage or hours of use due to the relatively short distances the vehicles travel and the frequent stop/start nature of emergency response and rescue operations. The Public Works Department's Municipal Operations Division utilizes loaders to maintain and repair beaches, streets and sidewalks. The 624 P-Tier wheel loader is a mid -size model that John Deere offers. The 410 P-tier backhoe loader is the second largest/most powerful of the five different backhoe loader models that John Deere offers. Both models are well suited to the City of Newport Beach's particular needs and uses and staff is familiar with their operating controls. The current backhoe loader (Unit No. 3331) was purchased in 2014, and the wheel loader (Unit No. 3657) in 2015. Both units are now scheduled for replacement in accordance with City Council Policy F-9 replacement criteria of 10 years or 5,000 hours for heavy equipment. Replacement for this type of equipment is typically less frequent than some others due to their more periodic use patterns, and the schedule is based on either hours of use or age rather than mileage due to the relatively short distances they typically travel when operating. Staff published a Request for Bids No. 25-15 (Attachment A) on August 9, 2024, seeking three Toyota Tacoma TRD Off -Road 4WD double cab pickup trucks, and informed nine local Toyota dealers of the open bid. The bidding process closed on September 12, 2024, and the City received bids from Toyota of Glendale, RP Automotive of Downey, and Al Financial Services of Moreno Valley. Toyota of Glendale was the lowest responsive and responsible bidder with a total quoted cost of $47,641.91 per truck (Attachment A). Coastline Equipment is an official John Deere dealer, and its Long Beach location provided quotes for each loader utilizing Sourcewell Cooperative purchasing agreement 0011723-JDC. Cooperative agreements are compliant with federal and State purchasing requirements, and the City's Finance Department found this Sourcewell cooperative agreement and bidding process met the minimum requirements of the City's administrative procedures. Using the Sourcewell agreement also provides significant cost savings from suggested list prices for this equipment. Equipment . Suggested List Sourcewell Pre -Tax Total w/ I Price Selling Price Discount Tax P 410 -Tier Backhoe Loader $256,653.07 $160,799.05 ($95,854.02) $173,260.98 624 P-Tier $422,224.00 $277,032.00 ($145,192.00) $298,501.98 Wheel Loader Total $678,877.07 $437,831.05 ($241,046.02) $471,762.96 13-2 Approval of Vehicle Replacement Purchase Orders for Three Toyota Tacoma Trucks, One John Deere Wheel Loader, and One John Deere Backhoe Loader October 22, 2024 Page 3 FISCAL IMPACT: The adopted Fiscal Year 2024-25 budget includes sufficient funding for these replacement vehicles. The purchases will be expensed to the Rolling Equipment Account in the Public Works Department Equipment Fund, 7529032-911016. ENVIRONMENTAL REVIEW: Staff recommends the City Council find this action is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. z[9111[NVLes The agenda item has been noticed according to the Brown Act (72 hours in advance of the meeting at which the City Council considers the item). ATTACHMENTS: Attachment A — Bid Results RFB No. 25-15 Attachment B — Coastline Equipment Quotation No. 31472455 Attachment C — Coastline Equipment Quotation No. 31431336 13-3 Attachment A City of Newport Beach Bid Results for Project (3) 2024 or Newer Toyota Tacoma TRD Off -Road 4WD Double Cab Pickup Trucks (25-15) Issued on 08/29/2024 Bid Due on September 12, 2024 1:00 PM (PDT) Exported on 09/12/2024 Line Totals (Unit Price * Quantity) Toyota Of Toyota Of Al FINANCIAL Al FINANCIAL Item Unit of Glendale - Unit Glendale - Line rp automotive rp automotive SERVICES LLC - SERVICES LLC - Num Section Description Measure Quantity Price Total - Unit Price - Line Total Unit Price Line Total 2024 or Newer Toyota Tacoma TRD Off -Road 4WD 1 Section 1 Double Cab Pickup Truck EACH 3 $44,059.00 $132,177.00 $46,600.00 $139,800.00 $56,269.00 $168,807.00 2 Section 1 Tire Recycling Fee EACH 15 $8.75 $131.25 $1.75 $26.25 $8.75 $131.25 3 Section 1 DMV Registration Fee VEHICLE 3 $33.00 $99.00 $33.00 $99.00 $469.00 $1,407.00 4 Section 1 DMV Documentation Fee VEHICLE 3 $85.00 $255.00 $85.00 $255.00 $85.00 $255.00 5 Section 1 Tax EACH Delivery Charge (if 6 Section 1 applicable) LOT 1 $3,421.16 1 $0.00 Subtotal Total $3,421.16 $10,854.27 $10,854.27 $0.00 $0.00 $0.00 $0.00 $0.00 $200.00 $200.00 $136, 083.41 $151,034.52 $170, 800.25 $136, 083.41 $151,034.52 $170, 800.25 )nly taxed one unit lEverything looks accurate Did not include any tax ax should be $10,263.48 Tax should be $13,102.305 otal price should be $142,925.73 Total price should be $183,902.55 2 3 13-4 aJOHN DEERE ATTACHMENT B COASTLINE Equipment Prepared For: CITY OF NEWPORT BEACH 590 SUPERIOR AVE NEWPORT BEACH, CA 92663 Business: 949-644-3063 Sourcewell Contract #011723-JDC Quote Summary • Contract Term: April 5, 2023 — April 14, 2027, with 1 possible oneyear renewal • Eligibility: Open to eligible federal, state/province, and municipal governmental entities, higher education, K12 education, nonprofit, tribal government, and other public entities located in the United States and Canada and are members of Sourcewell. Equipment Summary JOHN DEERE 410 P-Tier Backhoe Loader Equipment Total Prepared By: KENNETH HAMMOND Coastline Equipment Company 6242 N Paramount Blvd Bldg A Long Beach, CA 90805 Phone: 562-272-7400 ken.hammond@coastlineequipment.com Quote Id Created On Expiration Date: 31472455 08 August 2024 31 October 2024 Suggested List Selling Price Qty Extended $ 256,653.07 $ 160,799.05 X 1 = $ 160,799.05 $ 160,799.05 Quote Summary Equipment Total $ 160,799.05 SubTotal $ 160,799.05 Sales Tax - (7.75%) $ 12,461.93 Total $ 173,260.98 Down Payment (0.00) Rental Applied (0.00) Balance Due $ 173,260.98 Salesperson : X Confidential Accepted By : X 13-5 aJOHN DEERE Selling Equipment Quote Id: 31472455 Customer: CITY OF NEWPORT BEACH COASTLINE Equipment JOHN DEERE 410 P-Tier Backhoe Loader Hours: Suggested List Stock Number: $ 256,653.07 Selling Price $ 160,799.05 Code Description Qty Unit Extended 17EOT 410 P-tier Backhoe Loader 1 $ 197,574.00 $ 197,574.00 Standard Options - Per Unit 183E JDLinkTM 1 $ 0.00 $ 0.00 0202 United States 1 $ 0.00 $ 0.00 0259 English 1 $ 0.00 $ 0.00 0351 Translated Text Labels 1 $ 0.00 $ 0.00 1003 Cab 1 $ 14,253.00 $ 14,253.00 3009 Autoshift Transmission - Mechanical 1 $ 0.00 $ 0.00 Front Wheel Drive (MFWD) with Limited Slip Differential 4006 John Deere 4.5L - FT4/Stage IV 1 $ 0.00 $ 0.00 5250 Galaxy 21 L-24 12PR Rear & 1 $ 0.00 $ 0.00 12.5/80-18 10PR Front 6152 Single Battery with Disconnect and 1 $ 0.00 $ 0.00 Jump Post 6577 1250 lb. (567 kg.) Front Counterweight 1 $ 1,938.00 $ 1,938.00 6752 Extendible Dipperstick 1 $ 9,003.00 $ 9,003.00 7002 Auxiliary Hydraulics with One & Two 1 $ 6,700.00 $ 6,700.00 Way Flow (Hammer & Thumb/Swinger) 7028 Pilot Controls, Two Lever, with Pattern 1 $ 0.00 $ 0.00 Selection 7037 Two -Function Loader Hydraulics, 1 $ 0.00 $ 0.00 Single Lever 7700 Less Coupler - Less Thumb 1 $ 0.00 $ 0.00 7800 Less Backhoe Bucket with Bucket Pins 1 $ 0.00 $ 0.00 7865 92 in. (2.33 m.) General Purpose 1 $ 6,090.00 $ 6,090.00 Bucket, 1.50 cu. yd. (1.15 cu. m.) 8075 Diagnostic Oil Sampling Ports 1 $ 450.00 $ 450.00 8096 Premium Mirror Option - Exterior Rear 1 $ 199.00 $ 199.00 View Mirrors (2) and Front View Mirror (1) 8142 LED Light Package 1 $ 1,133.00 $ 1,133.00 8146 Left Side Console Storage with Cup 1 $ 87.00 $ 87.00 Holders 8165 Auto Ride Control 1 $ 2,513.00 $ 2,513.00 8183 Radio, Bosch Premium Package 1 $ 1,459.00 $ 1,459.00 8207 Seat, Cloth Air -Suspension 1 $ 541.00 $ 541.00 8226 Strobe Light with Magnetic Mount 1 $ 633.00 $ 633.00 13-6 Confidential aJOHN DEERE Selling Equipment Quote Id: 31472455 Customer: CITY OF NEWPORT BEACH COASTLI N E Equipment /' AT186288 SLOW MOVING VEHICLE EMBLEM 1 $ 119.00 $ 119.00 AT446496 LICENSE PLATE BRACKET 1 $ 59.00 $ 59.00 PDI FREIGHT, GET READY AND LOCAL 1 $ 10,200.00 $ 10,200.00 DELIVERY QC30 TAG WAIN/ROY STYLE QUICK 1 $ 1,233.87 $ 1,233.87 COUPLER T18WR1 TAG 18" WAIN/ROY STYLE BUCKET 1 $ 1,145.20 $ 1,145.20 T24WR1 TAG 24" WAIN/ROY STYLE BUCKET 1 $ 1,323.00 $ 1,323.00 Standard Options Total $ 59,079.07 Suggested Price $ 256,653.07 Customer Discounts Customer Discounts Total $-95,854.02 $-95,854.02 13-7 Confidential TERMS AND CONDITIONS Whenever the term "Company" is mentioned herein, it is understood to refer to Coastline Equipment. The filling of this order by the company is contingent upon strikes, fires, accidents or delay resulting from any cause beyond the company's control: and accepting delivery from the carrier shall constitute a waiver of all claims from damage by reason of delay from whatsoever cause. It is agreed that the title and right of possession to all property sold under this contract remains in the company. Whatever may be its mode of attachment to realty or otherwise, until the company has received the full price therefore as herein provided. Upon failure to make payments or any of them as herein specified, the company may retain as liquidated damage and rental all partial payment theretofore made and shall be free to enter the premises where such property may be located and remove the same as its own without prejudice to any further claims on account of damage which the company may suffer from any cause. Purchaser agrees to do all acts and things necessary to perfect and maintain the above title and right. The property included in this order is sold under the manufacturer's warranty only unless there is an express warranty in writing signed by an executive or manager of the company. THERE ARE NO WARRANTIES OF MERCHANTIBILITY OR FITNESS FOR A PARTICULAR PURPOSE. UNDER NO CIRCUMSTANCES SHALL THE COMPANY BE HELD LIABLE HEREUNDER FOR ANY SPECIAL INDIRECT OR CONSQUENTIAL DAMAGES HOWEVER ARISING in any case where there is an express warranty by the company of the property sold or any part of it, the company may, at its own expense, reclaim the item so warranted and repay to the purchaser any sums which may have been paid thereon, and such repayment shall satisfy and fully discharge the company's entire liability arising out of state. This order shall not become a contract binding upon the company until approved and accepted in writing by an executive officer of the company located in Long Beach, California. Notice of such approval will be furnished to the purchaser by acknowledgment of the order. All terms of this sale are embodied herein, and no agreement, guaranty or warranty, oral or written, expressed or implied, not included herein shall in any way enlarge, limit or qualify the rights or the liabilities of the purchaser or the company. Purchaser agrees to install upon the equipment, at his expense, all safety devices that may be required by any federal, state, or local safety regulations. Purchaser further agrees to protect and save seller harmless from any and all claims for property damages or personal injury, including death arising out of the use and operation of the equipment, regardless of nature or cause. TERMS OF SALE: Unless otherwise agreed in writing and unless payment is made within 10 days from the date of invoice, interest on the unpaid balance shall be at the rate of 18% annum from the date of the invoice unless applicable law makes such rate of interest illegal, in which case the rate of interest shall be maximum permitted by law. RENTAL: Rates unless otherwise noted are based on 176 hours usage per month, 2"d or 3`d shift rates will be computed at 50% of monthly rate. Lessee agrees to pay in addition to the monthly rental charge an adjustment for the tire wear during the rental period. FREIGHT: If stated as a separate item, is approximate and actual freight cost shall be for customer's account. SALES or excise taxes, federal or state, now or hereafter imposed, on the sale of good covered by this proposal, shall be for the account of the customer. THIS PROPOSAL IS NOT AN OFFER TO SELL. This document evidences preliminary negotiations. Any sales are subject to approval by the Credit Manager of Coastline Equipment and to approval by an officer of Coastline Equipment. All sales shall be upon applicable Coastline Equipment sales order forms and subject to all of the terms and conditions as set forth herein. This proposal shall automatically lapse 30 days from the date hereof. COASTLINE EQUIPMENT reserves the right to correct clerical errors. 13-8 aJOHN DEERE ATTACHMENT C COASTLINE Equipment Quote Summary Prepared For: Prepared By: CITY OF NEWPORT BEACH KYLE BRODOWSKI KENNETH HAMMOND 592 SUPERIOR AVE BLDG D Coastline Equipment Company NEWPORT BEACH, CA 92663 6242 N Paramount Blvd Bldg A Business: 949-718-3464 Long Beach, CA 90805 Phone: 562-272-7400 ken.hammond@coastlineequipment.com Sourcewell Contract #011723-JDC Quote Id: 31431336 Created On: 01 August 2024 • Contract Term: April 5, 2023 — April 14, 2027, with 1 possible oneyear renewal Expiration Date: 31 October 2024 • Eligibility: Open to eligible federal, state/province, and municipal governmental entities, higher education, K12 education, nonprofit, tribal government, and other public entities located in the United States and Canada and are members of Sourcewell. Equipment Summary Suggested List Selling Price Qty Extended JOHN DEERE 624 P-Tier Wheel $ 422,224.00 $ 277,032.00 X 1 = $ 277,032.00 Loader Equipment Total $ 277,032.00 Quote Summary Equipment Total $ 277,032.00 SubTotal $ 277,032.00 Sales Tax - (7.75%) $ 21,469.98 Total $ 298,501.98 Down Payment (0.00) Rental Applied (0.00) Balance Due $ 298,501.98 Salesperson : X Confidential Accepted By : X 13-9 aJOHN DEERE Selling Equipment Quote Id: 31431336 Customer: CITY OF NEWPORT BEACH KYLE BRODOWSKI JOHN DEERE 624 P-Tier Wheel Loader Hours: Stock Number: Code 6041 DW Description 624 P Wheel Loader Qty 1 Standard Options - Per Unit 183E JDLinkTM 1 0202 United States 1 0259 English 1 0351 Translated Text Labels 1 0400 Standard Loader 1 0451 Standard Z-BAR 1 0613 Level 3 Trim 1 0659 Level 4 Performance 1 0952 Rear Camera (Secondary Display) 1 1100 Less Detection System 1 1301 Left Side Steps 1 2201 Less Payload Scale w/ Cycle Counter 1 4095 John Deere 6.8L - FT4/SV 1 5114 Michelin XTLA - 20.5R25 L2 1-Star 1 Radial Tires w/ 3 PC Rims 5553 Full Coverage Front Fenders 1 6522 Rear Counterweight & Rear Hitch w/ 1 Pin 7025 Single Axis Lever Controls 1 7054 Three Function Hydraulics 1 7403 Hydraulic Coupler - JRB 416 Pattern 1 7458 Bolt -On Cutting Edge 1 7500 Less Fork Frame 1 7700 Less Tines 1 7822 3.00 YD (2.30 CM) Enhanced 1 Performance 8295 Heated And Powered Exterior Mirrors 1 8501 Debris Package 1 8502 Maintenance and Service Package 1 8505 Guards - Transmission & Bottom 1 8508 Auxiliary Equipment Package 1 Dealer Attachments SUBLET Hardface Loader Bucket Side Cutters & 1 Cutting Edge COASTLINE Equipment Suggested List $ 422,224.00 Confidential 13-10 aJOHN DEERE Selling Equipment Quote Id: 31431336 Customer: CITY OF NEWPORT BEACH KYLE BRODOWSKI Setup Sourcewell Fee Other Charges COASTLINE Equipment Confidential 13-11 JOHN DEERE Extended Warranty Extended Warranty Proposal JOHN DEERE 624 P-Tier Wheel Loader Date :August 12, 2024 Machine/Use Information Plan Description Price Manufacturer JOHN DEERE Application Governmental Deductible $ 0.00 Equipment Type 624PAT Coverage Powertrain & List $ 6,800.00 Hydraulic Model 624PAT Total Months 84 Country Total Hours 5000 Extended Warranty is available only through authorized John Deere Dealers for John Deere Products,and may be purchased at any time before the product's Standard Warranty,or Extended Warranty expires. Extended Warranty Proposal Prepared for: Customer Name - Please Print Customer Signature I have been offered this extended warranty and ❑ I ACCE Tthe Extended Warranty ❑ I DECLINEthe Extended Warranty If declined, I fully understand that any equipment listed above is not covered for customer expenses due to component failures beyond the original basic warranty period provided by John Deere. Note : This is not a contract. For specific Extended Warranty coverage terms and conditions, please refer to the actual Extended Warranty contract for more information and the terms, conditions and limitations of the agreement. What Extended Warranty is : The Extended Warranty Program is for the reimbursement on parts and labor for covered components that fail due to faulty material or original workmanship that occur beyond the John Deere Basic Warranty coverage period. The agreement is between Deere & Company and the owners of select John Deere Construction and Forestry equipment, who purchase the Extended Warranty Plans for the desired coverage as indicated in this proposal. What Extended Warranty is not: Extended Warranty is not insurance. It also does not cover routine maintainance or high wear items,or insurance - related risks/perils such as collision, overturn, vandalism, wind, fire, hail, etc. It does not cover loss of income during or after an equipment failure. See the actual product -specific Extended Warranty agreement for a complete listing of covered components, and limitations and conditions under the program. Features/Benefits: Extended Warranty includes the following features and benefits under the program • Pays for parts and labor costs incurred on failed covered components (less any applicable deductibles), Does not require pre -approval before repairs are made by the authorized John Deere dealership, • Payments are reimbursed directly to the dealership with no prepayment required by the contract holder. Confidential 13-12 TERMS AND CONDITIONS Whenever the term "Company" is mentioned herein, it is understood to refer to Coastline Equipment. The filling of this order by the company is contingent upon strikes, fires, accidents or delay resulting from any cause beyond the company's control: and accepting delivery from the carrier shall constitute a waiver of all claims from damage by reason of delay from whatsoever cause. It is agreed that the title and right of possession to all property sold under this contract remains in the company. Whatever may be its mode of attachment to realty or otherwise, until the company has received the full price therefore as herein provided. Upon failure to make payments or any of them as herein specified, the company may retain as liquidated damage and rental all partial payment theretofore made and shall be free to enter the premises where such property may be located and remove the same as its own without prejudice to any further claims on account of damage which the company may suffer from any cause. Purchaser agrees to do all acts and things necessary to perfect and maintain the above title and right. The property included in this order is sold under the manufacturer's warranty only unless there is an express warranty in writing signed by an executive or manager of the company. THERE ARE NO WARRANTIES OF MERCHANTIBILITY OR FITNESS FOR A PARTICULAR PURPOSE. UNDER NO CIRCUMSTANCES SHALL THE COMPANY BE HELD LIABLE HEREUNDER FOR ANY SPECIAL INDIRECT OR CONSQUENTIAL DAMAGES HOWEVER ARISING in any case where there is an express warranty by the company of the property sold or any part of it, the company may, at its own expense, reclaim the item so warranted and repay to the purchaser any sums which may have been paid thereon, and such repayment shall satisfy and fully discharge the company's entire liability arising out of state. This order shall not become a contract binding upon the company until approved and accepted in writing by an executive officer of the company located in Long Beach, California. Notice of such approval will be furnished to the purchaser by acknowledgment of the order. All terms of this sale are embodied herein, and no agreement, guaranty or warranty, oral or written, expressed or implied, not included herein shall in any way enlarge, limit or qualify the rights or the liabilities of the purchaser or the company. Purchaser agrees to install upon the equipment, at his expense, all safety devices that may be required by any federal, state, or local safety regulations. Purchaser further agrees to protect and save seller harmless from any and all claims for property damages or personal injury, including death arising out of the use and operation of the equipment, regardless of nature or cause. TERMS OF SALE: Unless otherwise agreed in writing and unless payment is made within 10 days from the date of invoice, interest on the unpaid balance shall be at the rate of 18% annum from the date of the invoice unless applicable law makes such rate of interest illegal, in which case the rate of interest shall be maximum permitted by law. RENTAL: Rates unless otherwise noted are based on 176 hours usage per month, 2"d or 3`d shift rates will be computed at 50% of monthly rate. Lessee agrees to pay in addition to the monthly rental charge an adjustment for the tire wear during the rental period. FREIGHT: If stated as a separate item, is approximate and actual freight cost shall be for customer's account. SALES or excise taxes, federal or state, now or hereafter imposed, on the sale of good covered by this proposal, shall be for the account of the customer. THIS PROPOSAL IS NOT AN OFFER TO SELL. This document evidences preliminary negotiations. Any sales are subject to approval by the Credit Manager of Coastline Equipment and to approval by an officer of Coastline Equipment. All sales shall be upon applicable Coastline Equipment sales order forms and subject to all of the terms and conditions as set forth herein. This proposal shall automatically lapse 30 days from the date hereof. COASTLINE EQUIPMENT reserves the right to correct clerical errors. 13-13