Attachment 2D
CONSTRUCTION AGREEMENT
This Agreement is dated for identification this 4 l day of April 2018 and is made by and
between the TOWN OF LOS GATOS, a California municipal corporation, whose address is 110
East Main Street, Los Gatos, California 95030 (hereinafter "TOWN "), and Mercoza Engineering,
whose address is 1013 Hoover Street, Escondido, CA 92027 (hereinafter "CONTRACTOR ").
NOW, THEREFORE, the parties agree:
ARTICLE I: WORK TO BE DONE AND DOCUMENTS FORMING THE CONTRACT.
That for and in consideration of the payments and agreements hereinafter mentioned, to
be made and performed by the said TOWN, and under the conditions expressed in the two bonds
hereunto annexed, the said CONTRACTOR agrees with the said TOWN, at his own proper cost
and expense, to do all the work and furnish all the materials and equipment necessary to
construct and complete, in accordance with the plans and specifications hereinafter mentioned, in
a good, workmanlike and substantial manner, under the supervision of the Town Engineer, or
his, of the TOWN OF LOS GATOS, California, all the works and improvements described,
mentioned and set forth in those plans and specifications on file in the Office of the Parks and
Public Works of said TOWN, entitled:
Plans and Specifications for
Project #17- 813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and
17- 812 -0126 Crosswalk Improvements
which said plans and specifications and all the documents therein contained, including the
TOWN OF LOS GATOS's Standard Provisions, are hereby specially referred to and by such
reference made part of this contract.
ARTICLE II: CONTRACTOR'S ACCEPTANCE
CONTRACTOR agrees to receive and accept the prices shown on Exhibit "A"
264,676) which is attached hereto and incorporated by reference herewith, as fulll
compensation for furnishing all materials and equipment and for doing all the work described in
the contract documents; also for all loss or damage as provided in the contract documents in the
prosecution of the work until its acceptance by the Town Council of the TOWN OF LOS
GATOS, and for well and faithfully completing the work, and the whole thereof, in the manner
and according to the contract documents, plans and specifications, and the requirements of the
Town Engineer.
ARTICLE III: ACCEPTANCE BY TOWN
The said TOWN hereby promises and agrees with the said CONTRACTOR to employ,
and does hereby employ the said CONTRACTOR to provide the materials and to do the work
according to the terms and conditions herein contained and referred to, for the prices aforesaid,
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Construction Agreement — Mercoza Engineering
Project 417 -813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and #17 -812 -0126 Crosswalk Improvements
and hereby contracts to pay the same at the time, in the manner and upon the conditions above
set forth; and the said parties for themselves their heirs, executors, administrators, successors and
assigns, do hereby agree to the full performance of the covenants herein contained.
ARTICLE IV: COMPLETION OF AGREEMENT
Reference is made to Part I — Page 1 of the TOWN's Project Specifications Notice to
Contractors which are hereby made a part of this contract. Inasmuch as the work called for
under this contract concerns a needed public improvement, the time of performance and
completion of this work is of the essence of this contract. It is expressly understood and agreed
by the parties hereto that all the work called for under this contract, in all its parts and
requirements, shall be completed thirty (30) working days from Notice to Proceed.
ARTICLE V: HOURS OF LABOR
The CONTRACTOR shall forfeit, as a penalty, to the TOWN, Twenty -Five Dollars ($25)
for each workman employed in the execution of the contract by him or by any subcontractor for
each calendar day during which any workman is required or permitted to labor more than eight
8) hours in violation of the provisions of Sections 1810 -1815 inclusive of the Labor Code and
all amendments thereto.
ARTICLE VI: APPRENTICES
Attention is directed to the provisions in Sections 1777.5, 1777.6 and 1777.7 of the Labor
Code governing the employment of apprentices by the CONTRACTOR or any subcontractor
under him. CONTRACTOR and any of his subcontractors shall comply with the requirements
of said sections of the Labor Code; CONTRACTOR shall have full responsibility for compliance
with the said sections regardless of any other contractual or employment relationships alleged to
exist.
Information relative to apprenticeship standards and other requirements may be obtained
from the Director of Industrial Relations ex officio the Administrator of Apprenticeship, San
Francisco, California or from the Division of Apprenticeship Standards at its branch offices.
ARTICLE VII: NONDISCRIMINATION
The CONTRACTOR sub recipient or subcontractor shall not discriminate on the basis of
race, color, national origin or sex in the performance of this contract. CONTRACTOR shall
carry out applicable requirements of 49 CFR Part 26 in the award and administration of DOT -
assisted contracts.
Failure by CONTRACTOR to carry out these requirements is a material breach of this
contract, which may result in the termination of this contract or such other remedy as recipient
deems appropriate.
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Construction Agreement — Mercon Engineering
Project #17 -813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and #17- 812 -0126 Crosswalk Improvements
ARTICLE VIII: INDEPENDENT CONTRACTOR
It is agreed that CONTRACTOR is an independent contractor, and all persons working
for or under the direction of CONTRACTOR are CONTRACTOR's agents, servants and
employees, and said persons shall not be deemed agents, servants or employees of TOWN.
ARTICLE IX: OWNERSHIP OF DATA AND DOCUMENTS
CONTRACTOR agrees that all records, specifications, data, maps, designs, graphics,
writings, recordings and other tangible materials regardless of form or format, including, without
limitation, electronically transmitted documents and ACAD files, and other collateral materials
collected, compiled, drafted, prepared, produced and /or generated in the performance of this
Agreement shall be the property of TOWN. CONTRACTOR shall regularly provide such
documents to TOWN upon TOWN's request. In the event that this Agreement is terminated
prior to completion of the scope of work, CONTRACTOR shall provide all such data and
documents to TOWN forthwith.
ARTICLE X: INSURANCE
a. Commercial General Liability /Automobile Liability Insurance:
CONTRACTOR shall obtain and maintain Commercial General Liability
insurance and Automobile Liability insurance in the amount of One Million Dollars ($1,000,000)
per occurrence. If a general aggregate limit is used, either the general aggregate limit shall apply
separately to this contract or the general aggregate limit shall be twice the required occurrence
limit. CONTRACTOR's insurance coverage shall be written on an occurrence basis.
b. Workers' Compensation Insurance:
CONTRACTOR shall obtain and maintain statutory Workers' Compensation
insurance and Employer's Liability insurance in the amount of One Million Dollars ($1,000,000)
per accident.
CONTRACTOR is familiar with the Workers' Compensation laws of California
generally contained in Section 3700 of the Labor Code), including those provisions which
provide for specific exemptions from the requirement that all employers must carry Workers'
Compensation insurance, and CONTRACTOR maintains they are exempted under the law from
the requirement to maintain Workers' Compensation insurance coverage.
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Construction Agreement — Mercon Engineering
Project #17- 813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and #17- 812 -0126 Crosswalk hnprovements
In addition, during the term of any work for TOWN under said agreement:
1) CONTRACTOR will not employ any person in any manner so as to become subject to the
Workers' Compensation laws of California, or (2) should CONTRACTOR become subject to the
Workers' Compensation provisions of Section 3700 of the Labor Code for any reason,
CONTRACTOR shall forthwith comply with those provisions and send evidence of financial
compliance to TOWN.
C. Acceptability of Insurers: Insurance is to be placed with insurers with a current
Best Rating of A:VII unless otherwise acceptable to TOWN.
d. Verification of Coverage: Insurance, deductibles or self - insurance retentions shall
be subject to TOWN's approval. Original Certificates of Insurance with endorsements shall be
received and approved by TOWN before work commences, and insurance must be in effect for
the duration of the contract. The absence of insurance or a reduction of stated limits shall cause
all work on the project to cease. Any delays shall not increase costs to TOWN or increase the
duration of the project.
e. Other Insurance Provisions:
1) The TOWN OF LOS GATOS, its officers, officials, employees and
volunteers are to be covered as additional insured by Endorsement CG 20 10 11 85 or other
endorsement approved by Town Attorney for Commercial General and Automobile Liability
coverage.
2) For any claims related to this project, CONTRACTOR's insurance
coverage shall be primary and any insurance or self - insurance maintained by TOWN, its officers,
officials, employees and volunteers shall not contribute to it.
3) Each insurance policy required shall be endorsed that a thirty (30) day
notice be given to TOWN in the event of cancellation or modification to the stipulated insurance
coverage.
4) In the event CONTRACTOR employs subcontractors as part of the work
covered by this Agreement, it shall be the responsibility of CONTRACTOR to ensure that all
subcontractors comply with the same insurance requirements that are stated in this Agreement.
5) Approval of the insurance by TOWN or acceptance of the Certificate of
Insurance by TOWN shall not relieve or decrease the extent to which CONTRACTOR may be
held responsible for payment of damages resulting from CONTRACTOR's services or operation
pursuant to this Agreement, nor shall it be deemed a waiver of TOWN's rights to insurance
coverage hereunder.
6) If, for any reason, CONTRACTOR fails to maintain insurance coverage
that is required pursuant to this contract, the same shall be deemed a material breach of contract.
TOWN, at its sole option, may terminate this contract and obtain damages from CONTRACTOR
resulting from said breach. Alternately, TOWN may purchase such required insurance coverage,
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Construction Agreement — Mercoza Engineering
Project #17- 813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and #17- 812 -0126 Crosswalk Improvements
and without further notice to CONTRACTOR, TOWN may deduct from sums due to
CONTRACTOR any premium costs advanced by TOWN for such insurance.
ARTICLE XI: HOLD HARMLESS
CONTRACTOR hereby agrees to and shall hold TOWN, its elective and appointive
boards, commissions, officers, agents, registered volunteers, and employees harmless from any
liability for damage or claims for damage for personal injury, including death, as well as from
claims for property damage and any other claims of any sort whatsoever, including, but not
limited to, any liabilities, claims, losses, or expenses in any manner caused by, arising out of, or
in connection with, either directly or indirectly, the construction or installation of the work, the
guarding of the work, the use of improper materials in construction of the work, or the negligent,
willful, or intentional acts or omissions by CONTRACTOR or CONTRACTOR's subcontractors,
agents, or employee operations under this Agreement, whether such operations by
CONTRACTOR or by any of CONTRACTOR's subcontractors, or by any one or more persons
directly or indirectly employed by, or acting as agent for CONTRACTOR or any of
CONTRACTOR's subcontractors during the progress of the work or at any time before its
completion and final acceptance, excepting suits and actions brought by the CONTRACTOR for
default of this Agreement or arising from the sole active negligence or willful misconduct of the
TOWN. The Town Council may retain so much of the money due to the CONTRACTOR as
shall be reasonably necessary to protect the TOWN, until disposition has been made of such suits
or claims for damages as aforesaid.
CONTRACTOR agrees to and shall pay TOWN's cost of defense (or, at the sole option
of the TOWN, CONTRACTOR shall defend with counsel approved by the TOWN Attorney)
and indemnify TOWN and its elective and appointive boards, commissions, officers, agents, and
employees from any suits or actions at law or in equity arising out of the execution, adoption or
implementation of this Agreement (exclusive of any such actions brought by CONTRACTOR),
such indemnification to include all costs of defense, judgments, and any awards of attorneys'
fees.
Should any accident or incident causing death, personal injury or property damage occur
between the date CONTRACTOR is notified that its General Liability and /or Workers
Compensation Insurance is canceled and the effective date of such cancellation,
CONTRACTOR's obligation to indemnify, defend and save harmless the TOWN, as provided
for hereinabove, shall in no manner be affected by the fact that the TOWN had not received the
notice of cancellation prior to the date of such accident or incident.
ARTICLE XIL• BONDING REQUIREMENT
CONTRACTOR agrees to post a Faithful Performance Bond and a payment bond for
Labor and Materials, or other guarantees, in the required amounts upon bond forms provided by
the TOWN, guarantying the performance of the terms of this Agreement. Surety issuing bonds
for CONTRACTOR shall be approved by the U.S. Department of Treasury's Financial
Management Service and shall be listed on the most current Treasury Circular 570 as contained
in the Federal Register.
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Construction Agreement— Mercoza Engineering
Project 417- 813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and 417 -812 -0126 Crosswalk Improvements
Contractor agrees to allow ten percent of the faithful performance bond to remain in effect for a
period of two years following Town Council project acceptance as guarantee for any needed
repair or replacement caused by defective materials and workmanship.
ARTICLE XIII: MAINTENANCE AND GUARANTY
CONTRACTOR shall promptly repair, replace, restore, or rebuild, as the TOWN may
determine, any finished product in which defects of materials or workmanship may appear or to
which damage may occur because of such defects, during a two (2) year period subsequent to the
date of final acceptance.
This article does not in any way limit the guaranty on any items for which a longer
guaranty is specified or on any items which a manufacturer gives a guaranty for a longer period,
nor does it limit the other remedies of the TOWN in respect to a latent defect, fraud or implied
warranties. CONTRACTOR shall furnish the TOWN all appropriate guaranties or warranty
certificates upon completion of the project.
ARTICLE XIV: SHORING FOR TRENCHES
If the contract specifies an expenditure of Twenty -Five Thousand Dollars ($25,000) or
greater for trenching, and if the depth of the trench is five feet (5) or more, then Section 6705 of
the Labor Code shall also be applicable.
ARTICLE XV: APPLICABLE LAWS AND ATTORNEY'S FEES
This Agreement shall be construed and enforced pursuant to the laws of the State of
California. Should any legal action be brought by a party for breach of this Agreement or to
enforce any provision herein, the prevailing party of such action shall be entitled to reasonable
attorneys' fees, court costs, and such other costs as may be fixed by the court. Reasonable
attorneys' fees of the TOWN Attorney's Office, if private counsel is not used, shall be based on
comparable fees of private attorneys practicing in Santa Clara County.
ARTICLE XVI: LIQUIDATED DAMAGES
It is mutually agreed by CONTRACTOR and TOWN that in the event that completion of
the construction by CONTRACTOR under this Agreement is delayed beyond DATE, TOWN
will suffer damages and will incur other costs and expenses of a nature and amount which is
difficult or impractical to determine. The Parties agree that by way of ascertaining and fixing the
amount of damages, costs and expenses, and not by way of penalty, CONTRACTOR shall pay to
TOWN the sum of One Thousand Five Hundred Dollars ($1,500.00) per day in liquidated
damages for each and every calendar day such delay in completion of the services under this
Agreement continues beyond DATE. In the event that the liquidated damages are not paid,
CONTRACTOR agrees that TOWN may deduct the amount of unpaid damages from any money
due or that may become due to CONTRACTOR under this Agreement.
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Construction Agreement — Mercon Engineering
Project #17 -813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and #17- 812 -0126 Crosswalk Improvements
ARTICLE XVII: INTERPRETATION OF CONTRACT
It is further expressly agreed by and between the parties hereto that should there be any
conflict between the terms of this instrument and the bid or proposal of said CONTRACTOR,
then this instrument shall control and nothing herein shall be considered as an acceptance of the
said terms of said proposal conflicting herewith.
ARTICLE XVIII: AMENDMENTS AND CHANGE ORDERS
This Agreement may be amended from time to time as necessary by formal and written
amendment or authorized change order executed by the Town Manager or designee and principal
acting on behalf of the CONTRACTOR.
ARTICLE XIX: DBE RESPONSIBILITIES
For projects that are State or Federal funding; With respect to Disadvantaged Business
Enterprises, CONTRACTOR shall do the following:
1) Pay each subcontractor under this prime contract for satisfactory performance of
its contract no later than ten (10) days from the receipt of each payment the prime contractor
receives from TOWN. Any delay or postponement of payment from the above - referenced time
frame may occur only for good cause following written approval of TOWN. This clause applies
to both DBE and non -DBE subcontractors.
2) Release all retainage owed to a subcontractor for satisfactory completion of the
accepted work within thirty (30) days after TOWN's payment to CONTRACTOR. Any delay or
postponement of payment from the above - referenced time frame may occur only for good cause
following written approval of TOWN. This clause applies to both DBE and non -DBE
subcontractors.
ARTICLE XX: PREVAILING WAGES
Reference is hereby made to copies of the general rate of per diem wages as determined
by the Director of the Department of Industrial Relations which may be obtained from the State
of California.
For failure to pay the prevailing wages, the CONTRACTOR shall forfeit, as a penalty, to
the TOWN, Fifty Dollars ($50) for each workman for each calendar day or portion thereof who
is paid less than the stipulated prevailing wage for work done under this contract, in violation of
the provisions of the Labor Code, Sections 1770 to 1780, inclusive. In addition to said penalty,
the CONTRACTOR, or subcontractor, shall pay to each worker the difference between the
prevailing wage and the amount paid to said worker for each calendar day for which said worker
was paid less than the prevailing wage.
This project is subject to compliance monitoring and enforcement by the Department of
Industrial Relations and /or the Town of Los Gatos.
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Construction Agreement — Mercon Engineering
Project #17- 813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and #17 -812 -0126 Crosswalk huprovements
CONTRACTOR shall comply with the provisions of the Davis -Bacon Act, as amended
40 USC 276a- 376a -5), and related requirements as certified in CONTRACTOR's bid proposal.
ARTICLE XXI: ENTIRE AGREEMENT
This Agreement contains the entire understanding between the parties with respect to the
subject matter herein. There are no representations, agreements or understandings (whether oral
or written) between or among the parties relating to the subject matter of this Agreement which
are not fully expressed herein.
ARTICLE XXII: PUBLIC RECORDS
The parties recognize and acknowledge that TOWN is subject to the California Public
Records Act, California Government Code Section 6250 and following. Public records are
subject to disclosure.
ARTICLE XXIII: NOTICES
Any notice required to be given to CONTRACTOR shall be deemed to be duly and
properly given if mailed to CONTRACTOR, postage prepaid, addressed to:
MERCOZA ENGINEERING
1013 HOOVER STREET
ESCONDIDO, CA 92027
or personally delivered to CONTRACTOR at such address or at such other addresses as
CONTRACTOR may designate in writing to TOWN.
Any notice required to be given TOWN shall be deemed to be duly and properly given if
mailed to TOWN, postage prepaid, addressed to:
Lisa Petersen, P.E.
Town Engineer
TOWN OF LOS GATOS
41 Miles Avenue
Los Gatos, California 95030
or personally delivered to TOWN at such address or at such other addresses as TOWN may
designate in writing to CONTRACTOR.
ARTICLE XXIV: SECTION 7106 FORM
Attached to the Agreement is a fully executed and sworn non - collusion affidavit as
required by Section 7106 of the California Public Contracts Code. Said affidavit is incorporated
herein by this reference.
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Constmction Agreement — Mercon Engineering
Project #17- 813 -9921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and #17- 812 -0126 Crosswalk Improvements
APPROVED AS TO CONTENT: "TOWN":
7/7 // ,j „„ TOWN OF LQS-QATOS
By: e, Matt Morley Laurel Prevetti
Director of Parks and Public Town Manager
APPROVED AS TO FORM:
Robert Schultz
Town Attomey
CONTRACTOR:
Name: A 1 Cow
Address: 1() 1,
71, j4voyeZ Sf
Tax ID No. or SSAN:
Attest: :al 6i I n
Shelley Neis
Clerk Administrator
M
Title:
By:
Title nl yv i pu a L
Corporate Seal
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CmsWCtion Agreement— Mewma Engineering
Project #17- 8139921 Annual Curb, Gutter, and Sidewalk Maintenance (Ramp Upgrades) and #17- 812 -0126 Ormswalk Improvements
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