HomeMy WebLinkAboutContracts & Agreements_126-2022AGREEMENT TO PERFORM NON-PROFESSIONAL SERVICES
FOR EQUIPMENT AND SUPPLIES
This agreement for the provision of supply of unleaded and diesel fuel ("Agreement") is
made and entered in this 21st day of June, 2022 ("Effective Date"), by and between the City of
Redlands, a municipal corporation ("City") and Merrimac Petroleum, Inc dba Merrimac Energy
Group, a California corporation ("Contractor") City and Consultant are sometimes individually
referred to herein as a "Party" and, together, as the "Parties " In consideration of the mutual
promises contained herein, City and Consultant agree as follows
ARTICLE 1 — ENGAGEMENT OF CONTRACTOR
1 1 City hereby engages Contractor to perform supply of unleaded and diesel fuel services for
City (the "Services")
1.2 The Services shall be performed by Contractor in a professional manner, and Contractor
represents that it has the skill and the professional expertise necessary to provide the
Services to City at a level of competency presently maintained by other practicing
professional Contractors in the industry providing like and similar types of Services
ARTICLE 2 — SERVICES OF CONTRACTOR
2 1 The Services that Contractor shall perform are more particularly described in Exhibit "A,"
titled "Scope of Services," which is attached hereto and incorporated herein by this
reference
2.2 Contractor shall comply with applicable federal, state and local laws and regulations in the
performance of this agreement including, but not limited to, any applicable State prevailing
wage laws
ARTICLE 3 — RESPONSIBILITIES OF CITY
3 1 City shall make available to Contractor information in its possession that may reasonably
assist Contractor in performing the Services
3.2 City designates Chris Boatman, Assistant City Manager Director, as City's representative
with respect to performance of the Services, and such person shall have the authority to
transmit instructions, receive information, interpret and define City's policies and decisions
with respect to performance of the Services
ARTICLE 4 — PERFORMANCE OF SERVICES
4 1 Contractor shall perform and complete the Services in a prompt and diligent manner in
accordance with the schedule set forth in Exhibit "A," titled "Scope of Services," which is
attached hereto and incorporated herein by this reference
4 1 The term of this Agreement shall be for a period of one (1) year commencing on July 1,
2022 (the "Initial Term") The City shall have the option to extend the Initial Term of this
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Agreement by two (2) additional one-year terms (each, an "Extended Term"), on the same
terms and conditions, by providing written notice to Contractor at least thirty (30) days
prior to the expiration of the Initial Term or any Extended Term. The Initial Term and the
Extended Terms are hereby collectively, referred to herein as the "Term" of this
Agreement.
4.2 If Contractor's Services include deliverable electronic visual presentation materials, such
materials shall be delivered in a form, and made available to City, consistent with City
Council -adopted policy for the same. It shall be the obligation of Contractor to obtain a
copy of such policy from City staff.
ARTICLE 5 — PAYMENTS TO CONTRACTOR
5 1 The compensation for Contractor's performance of the Services shall not exceed the
amount of One Million Two Hundred Thousand Dollars ($1,200,000) for the Services provided
during the Initial Term Should this Agreement be renewed, the compensation for Contractor's
performance for the Services shall not exceed the amount of One Million Two Hundred Thousand
Dollars ($1,200,000) for the first Extended Term, and One Million Two Hundred Thousand
Dollars ($1,200,000) for the second Extended Term, bringing the total possible amount of
compensation to a not -to -exceed amount of Three Million Six Hundred Thousand Dollars
($3,600,000) For the Initial Term and each Extended Term, City shall pay Contractor on a time
and materials basis up to the not to not -to -exceed amount in accordance with the rates specified in
Exhibit "B," titled "Fee Schedule," which is attached hereto and incorporated herein by reference.
5.2 Contractor shall submit monthly invoices to City describing the Services performed during
the preceding month. Contractor's invoices shall include a brief description of the Services
performed, the dates the Services were performed, the number of hours spent and by whom City
shall pay Contractor no later than thirty (30) days after receipt and approval by City of Contractor's
invoice
5.3 Any notice or other communication required, or which may be given, pursuant to this
Agreement, shall be in writing Any such notice shall be deemed delivered (i) on the date
of delivery in person, (ii) five (5) days after deposit in first class registered mail, with return
receipt requested, (iii) on the actual delivery date if deposited with an overnight courier, or
(iv) on the date sent by facsimile or electronic mail transmission (including PDF), if
confirmed with a copy sent contemporaneously by first class, certified, registered or
express mail, in each case properly posted and fully prepaid to the appropriate address set
forth below, or such other address as a Party may provide notice in accordance with this
section
CITY
City Clerk
City of Redlands
35 Cajon Street
P 0 Box 3005 (mailing)
Redlands, CA 92373
CONTRACTOR
Evan Peters, Business Development
Merrimac Petroleum, Inc dba Merrimac Energy Group
3738 Bayer Ave., Ste 204
Long Beach, CA 90808
epeters@merrimacenergy net
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jdonaldson@cityofredlands.org 562-420-6000
(909) 798-7531 562-420-6005
ARTICLE 6 — INSURANCE AND INDEMNIFICATION
6 1 The following insurance coverage required by this Agreement shall be maintained by
Contractor for the duration of its performance of the Services Contractor shall not perform
any Services unless and until the required insurance listed below is obtained by Contractor
Contractor shall provide City with certificates of insurance and endorsements evidencing
such insurance prior to commencement of the Services Insurance policies shall include a
provision prohibiting cancellation or modification of the policy except upon thirty (30)
days prior written notice to City
A. Workers' Compensation and Employer's Liability insurance in the amount that meets
statutory requirements with an insurance carrier acceptable to City, or certification to
City that Contractor is self -insured or exempt from the workers' compensation laws of
the State of California. Contractor shall execute and provide City with Exhibit "C,"
titled "Workers' Compensation Insurance Certification," which is attached hereto and
incorporated herein by this reference, prior to performance of the Services.
B Comprehensive General Liability insurance with carriers acceptable to City in the
minimum amount of One Million Dollars ($1,000,000) per occurrence and Two Million
Dollars ($2,000,000) aggregate, for public liability, property damage and personal
injury is required City shall be named as an additional insured and such insurance shall
be primary and non-contributing to any insurance or self-insurance maintained by City
C Business Auto Liability coverage, with minimum limits of One Million Dollars
($1,000,000) per occurrence, combined single limit bodily injury liability and property
damage liability This coverage shall include all Contractor owned vehicles used in
connection with Contractor's provision of the Services, hired and non -owned vehicles,
and employee non -ownership vehicles. City shall be named as an additional insured
and such insurance shall be primary and non-contributing to any insurance or self-
insurance maintained by City
6.2 Contractor shall defend, indemnify, and hold harmless City and its elected and appointed
officials, employees and agents from and against any and all claims, losses and liability,
including attorneys' fees, arising from injury or death to persons or damage to property
occasioned by any negligent act or omission by, or the willful misconduct of, Contractor,
or its officers, employees and agents in performing the Services
ARTICLE 7 — CONFLICTS OF INTEREST
7 1 Contractor covenants and represents that it does not have any investment or interest in any
real property that may be the subject of this Agreement or any other source of income,
interest in real property or investment that would be affected in any manner or degree by
the performance of Contractor's Services. Contractor further covenants and represents that
in the performance of its duties hereunder, no person having any such interest shall perform
any Services under this Agreement.
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7.2 Contractor agrees it is not a designated employee within the meaning of the Political
Reform Act because Contractor
A. Does not make a governmental decision whether to
(i) approve a rate, rule or regulation, or adopt or enforce a City law;
(ii) issue, deny, suspend or revoke any City permit, license, application,
certification, approval, order or similar authorization or entitlement,
(iii) authorize City to enter into, modify or renew a contract,
(iv) grant City approval to a contract that requires City approval and to which
City is a party, or to the specifications for such a contract;
(v) grant City approval to a plan, design, report, study or similar item,
(vi) adopt, or grant City approval of, policies, standards or guidelines for City
or for any subdivision thereof.
B Does not serve in a staff capacity with City and, in that capacity, participate in making
a governmental decision or otherwise perform the same or substantially the same duties
for City that would otherwise be performed by an individual holding a position
specified in City's Conflict of Interest Code under Government Code section 87302
7.3 In the event City determines that Contractor must disclose its financial interests, Contractor
shall complete and file a Fair Political Practices Commission Form 700, Statement of
Economic Interests, with the City Clerk's office pursuant to the written instructions
provided by the City Clerk,
ARTICLE 8 — GENERAL CONSIDERATIONS
8 1 In the event any action is commenced to enforce or interpret any of the terms or conditions
of this Agreement the prevailing Party shall, in addition to any costs and other relief, be
entitled to the recovery of its reasonable attorneys' fees, including fees for the use of in-
house counsel by a Party
8.2 Contractor shall not assign any of the Services, except with the prior written approval of
City and in strict compliance with the terms and conditions of this Agreement. Any
assignment or attempted assignment without such prior written consent may, in the sole
discretion of City, results in City's immediate termination of this Agreement.
8 3 Contractor is for all purposes under this Agreement an independent contractor and shall
perform the Services as an independent contractor Neither City nor any of its agents shall
have control over the conduct of Contractor or Contractor's employees, except as herein
set forth. Contractor shall supply all necessary tools and instrumentalities required to
perform the Services. Assigned personnel employed by Contractor are for its account only,
and in no event shall Contractor or personnel retained by it be deemed to have been
employed by City or engaged by City for the account of, or on behalf of City Contractor
shall have no authority, express or implied, to act on behalf of City in any capacity
whatsoever as an agent, nor shall Contractor have any authority, express or implied, to bind
City to any obligation.
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8 4 This Agreement may be terminated by City, in its sole discretion, by providing not less
than ten (10) days prior written notice to Contractor of City's intent to terminate If this
Agreement is terminated by City, an adjustment to Contractor's compensation shall be
made, but (1) no amount shall be allowed for anticipated profit or unperformed Services,
and (2) any payment due Contractor at the time of termination may be adjusted to the extent
of any additional costs to City occasioned by any default by Contractor Upon receipt of a
termination notice, Contractor shall immediately discontinue its provision of the Services
and, within five (5) days of the date of the termination notice, deliver or otherwise make
available to City, copies (in both hard copy and electronic form, where applicable) of
project related data, drawings, specifications, reports, summaries and such other
information and materials as may have been accumulated by Contractor in performing the
Services Contractor shall be compensated on a pro-rata basis for Services completed up to
the date of termination.
8 5 Contractor shall maintain books, ledgers, invoices, accounts and other records and
documents evidencing costs and expenses related to the Services for a period of three (3)
years, or for any longer period required by law, from the date of final payment to Contractor
pursuant to this Agreement. Such books shall be available at reasonable times for
examination by City at the office of Contractor
8 6 This Agreement, including the Exhibits incorporated herein by reference, represents the
entire agreement and understanding between the Parties as to the matters contained herein,
and any prior negotiations, written proposals or verbal agreements relating to such matters
are superseded by this Agreement. Except as otherwise provided for herein, any
amendment to this Agreement shall be in writing, approved by City and signed by City and
Contractor
8 7 This Agreement shall be governed by and construed in accordance with the laws of the
State of California, without regard to its conflicts of laws provisions The Parties agree that
all actions or proceedings arising in connection with this Agreement shall be tried and
litigated only in the state courts located in San Bernardino County, California, and the
federal courts located in Riverside County, California.
8 8 If one or more of the sentences, clauses, paragraphs or sections contained in this Agreement
is declared invalid, void or unenforceable by a court of competent jurisdiction, the same
shall be deemed severable from the remainder of this Agreement and shall not affect,
impair or invalidate the remaining sentences, clauses, paragraphs or sections contained
herein, unless to do so would deprive a Party of a material benefit of its bargain under this
Agreement.
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IN WITNESS WHEREOF, duly authorized representatives of City and Contractor have
signed in confirmation of this Agreement
CITY OF REDLANDS
Paul T Barich, Mayor
ATTEST
MERRIMAC PETROLEUM, INC dba
MERRIMAC ENERGY GROUP
By
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Evan Peters, Business Development
EXHIBIT "A"
SCOPE OF SERVICES
Contractor shall furnish and use, at their own expense, all materials, labor tools, equipment,
supplies and transportation to provide services required under the Agreement. Fuel products
include unleaded gasoline and diesel fuel which shall be delivered on an as -needed basis to City
locations specified herein.
The City currently purchases, and Contractor shall be required to provide, the following types of
fuel products
Gasoline Diesel Fuel
87 Regular Unleaded CARB ETH Ultra -Low Sulfur CARB Diesel (clear)
The quoted markup (markup or discount) offered shall remain firm throughout the contract
period, although City may receive the benefit of any rebates, allowances, or other price reduction
incentives offered to customers of Contractor, including any pass -through incentives from the
refineries
No upward price adjustment shall be due Contractor, when a Contractor delay beyond the 24-
hour notice, causes a price increase after City places an order, unless Contractor's failure to
make earlier delivery results from causes which are beyond the control of and without fault of
Contractor
Pricing shall be based on a variable price (Oil Price Information Service — Closing OPIS) tied to
a published index (Unbranded Average for the Inland Empire Area, Colton) plus Contractor's
positive or negative price differential
Contractor shall be licensed in accordance with all applicable laws, rules and regulations,
including but not limited to those promulgated in the California Business and Professions
Code and by the California Air Resources Board. Contractor shall possess all necessary and
applicable licenses required to transport motor vehicle fuels as may be issued by the State of
California Department of Motor Vehicles (DMV) and the United States Department of
Transportation (US DOT).
Adequate Resources.
Contractor shall have adequate office and personnel resources for responding to City's needs, including,
but not limited to, telephone coverage Monday -Friday during the hours of 8.00a.m. through 5.00p.m
Contractor shall provide the first and last names and telephone number(s) of the person(s) to be contacted
during City's normal working hours for order placement and resolution of contract issues. Contractor
shall also provide the names of three (3) individuals, with home telephone numbers, cell phone numbers
and pager numbers who may be contacted in the event of emergencies.
Contractor shall insure that all employees dealing directly with City with regard to the supply of Fuel
Products are fully aware of all contract provisions, including the requirements of City and the obligations
of Contractor All of Contractor's drivers shall be familiar with all City fueling locations and the delivery
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and the unloading requirements for each site. Contractor shall provide a dedicated account manager who
shall be assigned to handle all contract issues, including the ordering and invoicing for same.
Equipment:
Contractor's equipment and vehicles shall be in good and safe working order and all personnel shall be
trained in safety measures to preclude accidents endangering City personnel and property Contractor
shall have adequate and appropriate equipment for the delivery of goods on proposed contract. All
vehicles used by Contractor in fulfilling the terms of the contract shall meet all applicable federal and
state requirements for such vehicles, including US DOT, DMV and Caltrans codes and regulations and
the State of California Emission Inspection Program.
All dispensing and measuring equipment shall be tested and certified in accordance with the State of
California Business and Professions Code Division 5, Article 6 and shall meet the requirements of the
California Air Resources Board. All delivery vehicles and dispensing equipment shall meet all current
Federal and State requirements related to vapor recovery
Contractor's equipment shall be compatible with City facilities, including, but not limited to, pumping
equipment if needed, for filling underground fuel tanks and all of Contractor's personnel shall be
experienced and properly trained to safely and efficiently operate all of the equipment to be used in
fulfillment of the contract.
Fuel Specifications.
All fuel to be delivered on any order under the contract shall be homogenous and free of foreign matter
and impurities and shall remain so in normal storage. The gasoline and diesel to be furnished under the
contract shall meet, and conform to, all applicable ANSI and ASTM standards and the provisions of the
Federal Clean Air Act (latest revision) as well as the applicable rules, regulations and requirements of the
United Sates Environmental Protection Agency (USEPA), the California Air Resources Control Board
(CARB), the California Department of Food and Agriculture Division of Measurement Standards and the
San Joaquin Valley Air Pollution Control District (APCD) related to motor vehicle fuel standards The
gasoline and diesel must be of a quality equal to similar products furnished to the refiner's retail service
stations.
Enhancers, such as alcohol, for the purpose of increasing octane are not acceptable. Diesel fuel provided
shall meet ASTM Standard 975-97 and shall be Ultra -Low Sulfur CARB Diesel (clear) Diesel fuel shall
contain any required additives necessary to prohibit the growth of bacteria and algae during storage (fuel
and water-soluble biocide). Other additives such as water dispersants, corrosion inhibitors and detergents
shall be added in accordance with best industry practices.
Failure to comply with the requirements of this section shall, at the option of the Fleet Supervisor, be
deemed sufficient reason for rejection of any lot of fuel delivered, and Contractor shall, at no expense to
City, remove that fuel from the tank(s) and shall perform whatever services that shall be necessary to
restore the tank(s) and other equipment to an operable condition to the full satisfaction of City Further,
Contractor shall make full restitution for the quantities of fuel known to have been in the tank(s)
immediately prior to the delivery of the rejected lot of fuel, and for any damage to the equipment or
vehicles that may have occurred from use of the rejected fuel.
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Ordering Procedure and Delivery.
One (1) gallon of fuel shall be equal in volume to one (1) fluid gallon or 231 cubic inches at a standard
temperature of sixty (60 degrees Fahrenheit, as defined by the United States Bureau of Standards.
Contractor shall be required to provide both truck and trailer and bobtail service in order to access all City
fueling sites.
A City authorized fleet representative will notify contractor of the need for fuel. Contractor shall provide
fuel delivery within twenty-four (24) hours of notification by City Under periods of extreme usage,
delivery may be required within a twenty-four (24) hour period. City's normal working hours are 8.00
a.m. to 5.00 p.m., Monday through Friday, however, City is open (24) hours for deliveries, Monday
through Sunday, unless special arrangements are made with the individual fueling sites prior to delivery
Prior to off-loading City requests Veeder-Root ticket(s) to be printed and must match off-loading gallons.
All deliveries resulting from this contract shall be F O.B Destination to City sites. Note City's fueling
locations have employees on site for extended hours. After award of contract, Contractor may be allowed
to make routine deliveries outside of City's normal working hours on a site -by -site basis if agreeable to
the representative for each site. Automatic deliveries may also be arranged at the sole discretion of the
fueling sites.
For all deliveries not accomplished within twenty-four (24) hours, City reserves the right to procure the
product(s) elsewhere and may bill Contractor the difference between the contract price and the actual
purchase price, or any variation thereof, as liquidated damages, or City may deduct the difference in price
from any monies due, or which may become due to Contractor Failure to deliver within twenty-four (24)
hours on more than one occasion may be grounds for contract termination without further cause.
City reserves the right to deny access to City property any delivery vehicles leaking fuel or other
hazardous materials. Contractor will be notified of such denied access and shall make delivery of the
denied load within one (1) working day of notification with a City approved vehicle. Ordering procedures
may change when it is deemed in the best interest of City and Contractor shall adapt to changes as
required by City
Emergency Deliveries.
Deliveries requested outside of City's regular working hours of 8 00 a.m. to 5.00 p.m., Monday through
Sunday shall be considered emergency deliveries, unless Contractor and City have agreed in advance to a
routine delivery schedule encompassing the hours outside of normal working hours. Additionally,
deliveries shall not be considered emergency deliveries if the after-hours delivery is due to Contractor
failure to make a routine delivery of fuel within the normal working hours or if Contractor has made prior
special arrangements for a routine after-hours delivery
City shall endeavor to keep emergency deliveries to a minimum However, in the event of an emergency,
delivery shall be completed within twenty-four (24) hours of receipt of the request for emergency
delivery Contractor shall be allowed an additional payment for emergency deliveries. This cost shall be
stated as per hour cost (plus cost of fuel), as noted on the Price and Fee Bid. Provisions of the contract
shall in no way prohibit City from making an incidental purchase from another contractor for the same
commodities as listed herein and emergency purchases may be obtained from contract contractor or other
sources in order to best serve the interests of City
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Delivery Ticket/Manifest:
A delivery ticket (BOL) shall accompany each shipment. Fax and/or e-mail delivery tickets to Monica
Duran, Senior Administrative Assistant at (909) 335-4782, Monica.Duran@cityofredlands.org. Alternate
e-mails may be added at City's option. A legible signature and printed name of the designated City
representative is to be obtained and recorded on the delivery ticket at the time of the delivery Unsigned
tickets may not be left at the delivery location and it shall be the driver's responsibility alone to insure
that a delivery ticket has been signed. Invoices for payment, for which there is not a signed delivery
ticket, may not be authorized for payment. Emergency deliveries may be excluded Failure to provide a
delivery ticket with each shipment may be grounds for termination of the contract without further cause.
Spillage and Cleanup:
Contractor shall be responsible for all spillage and damage which may occur during loading, transit and
unloading operations. In the event of a spill or damage to property, Contractor shall immediately notify
City's representative at the corresponding delivery location. Damages to property and spills caused by
Contractor must be corrected immediately Cleanup shall be performed in accordance with USEPA and
State of California requirements. Any costs for repair of damage or correction of spillage performed by
City due to Contractor's failure to make timely or satisfactory repairs, corrections or cleanup of spills
shall be charged back to Contractor or deducted from monies owed to Contractor
Demurrage:
Up to one -hour of "standing time" shall be allowed at no charge for the purpose of unloading. Contractor
may assess demurrage charges, if the Contractor is unable to begin unloading fuel within one hour after
the scheduled arrival at City of Redlands site due to delays caused by City operations. Demurrages
charges shall apply in increments of one -quarter (1/4) hours.
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EXHIBIT "B"
FEE SCHEDULE
UNLEADED FUEL
A. Unleaded Fuel Bulk Purchase Full Truckload (8,000 + Gallons)
PPG
Discount Per Gallon (minus) COLTON RACK
$- 1301
Mark-up Per Gallon (plus) COLTON RACK
$
Delivery Charge
$.0320
B. Unleaded Fuel Bulk Purchase Less than Full Truckload (2,500 — 7,999)
PPG
Discount Per Gallon (minus) COLTON RACK
$- 1301
Mark-up Per Gallon (plus) COLTON RACK
$
Delivery Charge
$.0320
C. Unleaded Fuel. Bulk Purchase Less than Full Truckload (less than 2,500)
PPG
Discount Per Gallon (minus) COLTON RACK
$- 1301
Mark-up Per Gallon (plus) COLTON RACK
$
Delivery Charge
$.0320
DIESEL FUEL
D Diesel Fuel Bulk Purchase Full Truckload (8,000 + Gallons)
PPG
Discount Per Gallon (minus) COLTON RACK
$-.0890
Mark-up Per Gallon (plus) COLTON RACK
$
Delivery Charge
$.0330
E. Diesel Fuel Bulk Purchase Less than Full Truckload (2,500.7,999)
PPG
Discount Per Gallon (minus) COLTON RACK
$- 0430
Mark-up Per Gallon (plus) COLTON RACK
$
Delivery Charge
$.0330
F Diesel Fuel Bulk Purchase Less than Full Truckload (less than 2,500)
PPG
Discount Per Gallon (minus) COLTON RACK
$.0019
Mark-up Per Gallon (plus) COLTON RACK
$
Delivery Charge
$.0623
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EXHIBIT "C"
WORKERS' COMPENSATION INSURANCE CERTIFICATION
Every employer, except the State, shall secure the payment of compensation in one or more of the
following ways
(a) By being insured against liability to pay compensation by one or more insurers duly
authorized to write compensation insurance in this State
(b) By securing from the Director of Industrial Relations, a certificate of consent to
self -insure, either as an individual employer, or as one employer in a group of
employers, which may be given upon furnishing proof satisfactory to the Director
of Industrial Relations of ability to self -insure and to pay any compensation that
may become due to his or her employees
CHECK ONE
I am aware of the provisions of Section 3700 of the Labor Code which requires every
employer to be insured against liability for Workers' Compensation or to undertake self-insurance
in accordance with the provisions of that Code, and I will comply with such provisions before
commencing the performance of the work and activities required or permitted under this
Agreement (Labor Code § 1861)
I affirm that at all times, in performing the work and activities required or permitted under
this Agreement, I shall not employ any person in any manner such that I become subject to the
workers' compensation laws of California. However, at any time, if I employ any person such that
I become subject to the workers' compensation laws of California, immediately I shall provide the
City with a certificate of consent to self -insure, or a certification of workers' compensation
insurance
I certify under penalty of perjury under the laws of the State of California that the information and
representations made in this certificate are true and correct
MERRIMAC PETROLEUM, INC dba
MERRIMAC ENERGY GROUP
By
Evan Peters, Business I7eve7opment
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Date /47 22