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12-038 Consultant Services Agreement, Peckham & McKenney, City Manager Executive Search AGREEMENT BETWEEN THE CITY OF CUPERTINO AND PECKHAM & McKENNEY FOR CONSULTANT SERVICES FOR CITY MANAGER EXECUTIVE SEARCH THIS AGREEMENT, for reference dated March 21, 2012, is by and between CITY OF CUPERTINO, a municipal corporation (hereinafter referred to as "City"), and PECKHAM & McKENNEY_, a California partnership, whose address is 6700 Freeport Boulevard Suite 203 Sacramento, CA 95822(hereinafter referred to as "Consultant"), and is made with reference to the following: RECITALS: A. City is a municipal corporation duly organized and validly existing under the laws of the State of California with the power to carry on its business as it is now being conducted under the Constitution and thy° statutes of the State of California and the Cupertino Municipal Code. B. Consultant is specially trained, experienced and competent to perform the special services which will be required by this Agreement; and C. Consultant possesses the skill, experience, ability, background, certification and knowledge to provide the services described in this Agreement on the terms and conditions described herein. D. City and Consultant desire to enter into an agreement for services for the recruitment of the City Manager upon the terms and conditions herein. NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as follows: 1. TERM: The term of this Agreement shall commence on March 21, 2012 and shall terminate upon completion of the City Manager recruitment services described in Exhibit "A" attached hereto, unless terminated earlier as set forth herein. 2. SERVICES TO BE PERFORMED: Consultant shall perform each and every service set forth in Exhibit "A" which is attached hereto and incorporated herein by this reference. 3. COMPENSATION TO CONSULTANT: Consultant shall be compensated for recruiting services performed pursuant to this Agreement in the amount not to exceed $17,000 plus costs not to exceed $7,000. Costs include out of pocket costs associated with consultant travel, clerical, advertising, telephone printing/copying, supplies/postage, and background checks. Payment will be made by the City in the following manner: $5,666.67 of the fee shall be paid as a retainer upon execution of this agreement. The remainder of the fee will be divided and billed in two separate, monthly invoices. Costs are pre-approved by the CITY and will be billed at cost. 4. TIME IS OF THE ESSENCE: Consultant and City agree that time is of the essence regarding the performance of this Agreement. 5. STANDARD OF CARE: Consultant agrees to perform all services hereunder in a manner commensurate with the prevailing standards of like professionals in the San Francisco Bay Area and agrees that all services shall be performed by qualified and experienced personnel who are not employed by the City nor have any contractual relationship with City. 6. INDEPENDENT PARTIES: City and Consultant intend that the relationship between them created by this Agreement is that of employer-independent contractor. The manner and means of conducting the work are under the control of Consultant, except to the extent they are limited by statute, rule or regulation and the express terms of this Agreement. No civil service status or other right of employment will be acquired by virtue of Consultant's services. None of the benefits provided by City to its employees, including but not limited to, unemployment insurance, workers' compensation plans, vacation and sick leave are available from City to Consultant, its employees or agents. Deductions shall not be made for any state or federal taxes, FICA payments, PERS payments, or other purposes normally associated with an employer-employee relationship from any fees due Consultant. Payments of the above items, if required, are the responsibility of Consultant. 6. IMMIGRATION REFORM AND CONTROL ACT (IRCA): Consultant assumes any and all responsibility for verifying the identity and employment authorization of all of his/her employees performing work hereunder, pursuant to all applicable IRCA or other federal, or state rules and regulations. Consultant shall indemnify and hold City harmless from and against any loss, damage, liability, costs or expenses arising from any noncompliance of this provision by Consultant. 7. NON-DISCRIMINATION: Consistent with City's policy that harassment and discrimination are unacceptable employer/employee conduct, Consultant agrees that harassment or discrimination directed toward a job applicant, a City employee, or a citizen by Consultant or Consultant's employee or subcontractor on the basis of race, religious creed, color, national origin, ancestry, handicap, disability, marital status, pregnancy, sex, age, or sexual orientation will not be tolerated. Consultant agrees that any and all violations of this provision shall constitute a material breach of this Agreement. 8. HOLD HARMLESS: Consultant shall, to the fullest extent allowed by law, with respect to all services performed in connection with the Agreement. indemnify, defend, and hold harmless the City and its officers, officials, agents, employees and volunteers from and against any and all liability, claims, actions, causes of action or demands whatsoever against any of them, including any injury to or death of any person or damage to property or other liability of any nature, whether physical, emotional, consequential or otherwise, arising out, pertaining to, or related to the performance of this Agreement by Consultant or Consultant's employees, officers, officials, agents or independent contractors. Such costs and expenses shall include reasonable attorneys' fees of counsel of City's choice, expert fees and all other costs and fees of litigation. Claims for Other Liability. Consultant shall, to the fullest extent allowed by law, with respect to all services performed in connection with the Agreement, indemnify, defend, and hold harmless the City and its officers, officials, agents, employees and volunteers against any and all liability, claims, actions, causes of action or demands whatsoever from and against any of them, including any injury to or death of any person or damage to property or other liability of any nature, that arise out of,pertain to, or relate to the negligence, recklessness, or willful misconduct of Consultant or Consultant's employees, officers, officials, agents or independent contractors. Such costs and expenses shall include reasonable attorneys' fees of counsel of City's choice, expert fees and all other costs and fees of litigation. Consultant shall not be obligated under this Agreement to indemnify City to the extent that the damage is caused by the sole or active negligence or willful misconduct of City, its agents or employees. 9. INSURANCE: On or before the commencement of the term of this Agreement, Consultant shall furnish City with certificates showing the type, amount, class of operations covered, effective dates and dates of expiration of insurance coverage in compliance with paragraphs A, B, C, and D . Such certificates, which do not limit Consultant's indemnification, shall also contain substantially the following statement: "Should any of the above insurance covered by this certificate be canceled or coverage reduced before the expiration date thereof, the insurer affording coverage shall provide thirty (30) days' advance written notice to the City of Cupertino by certified mail, Attention: City Manager." It is agreed that Consultant shall maintain in force at all times during the performance of this Agreement all appropriate coverage of insurance required by this Agreement with an insurance company that is acceptable to City and licensed to do insurance business in the State of California. Endorsements naming the City as additional insured shall be submitted with the insurance certificates. A. COVERAGE: Consultant shall maintain the following insurance coverage: (1) Workers' Compensation: Statutory coverage as required by the State of California. (2) Liability: Commercial general liability coverage in the following minimum limits: Bodily Injury: $500,000 each occurrence $1,000,000 aggregate - all other Property Damage: $1 00,000 each occurrence $250,000 aggregate If submitted, combined single limit policy with aggregate limits in the amounts of$1,000,000 will be considered equivalent to the required minimum limits shown above. (3) Automotive: Comprehensive automotive liability coverage in the following minimum limits: Bodily Injury: $500,000 each occurrence Property Damage: $100,000 each occurrence or Combined Single Limit: $500,000 each occurrence (4) Professional Liability: Professional liability insurance which includes coverage for the professional acts, errors and omissions of Consultant in the amount of at least $1,000,000. B. SUBROGATION WAIVER: Consultant agrees that in the event of loss due to any of the perils for which he/she has agreed to provide comprehensive general and automotive liability insurance, Consultant shall look solely to his/her insurance for recovery. Consultant hereby grants to City, on behalf of any insurer providing comprehensive general and automotive liability insurance to either Consultant or City with respect to the services of Consultant herein, a waiver of any right to subrogation w:lich any such insurer of said Consultant may acquire against City by virtue of the payment of any loss under such insurance. C. FAILURE TO SECURE: If Consultant at any time during the term hereof should fail to secure or maintain the foregoing insurance, City shall be permitted to obtain such insurance in the Consultant's name or as an agent of the Consultant and shall be compensated by the Consultant for the costs of the insurance premiums at the maximum rate permitted by law and computed from the date written notice is received that the premiums have not been paid. D. SUFFICIENCY OF INSURANCE: The insurance limits required by City are not represented as being sufficient to protect Consultant. Consultant is advised to confer with Consultant's insurance broker to determine adequate coverage for Consultant. 10. CONFLICT OF INTEREST: Consultant warrants that it is not a conflict of interest for Consultant to perform the services required by this Agreement. Consultant may be required to fill out a conflict of interest form if the services provided under this Agreement require Consultant to make certain governmental decisions or serve in a staff capacity as defined in Title 2, Division 6, Section 18700 of the California Code of Regulations. 11. PROHIBITION AGAINST TRANSFERS: Consultant shall not assign, sublease, hypothecate, or transfer this Agreement, or any interest therein, directly or indirectly, by operation of law or otherwise, without prior written consent of City. Any attempt to do so without said consent shall be null and void, and any assignee, sublessee, hypothecate or transferee shall acquire no right or interest by reason of such attempted assignment, hypothecation or transfer. However, claims for money by Consultant from City under this Agreement may be assigned to a bank, trust company or other financial institution without prior written consent. Written notice of such assignment shall be promptly furnished to City by Consultant. The sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of Consultant, or of the interest of any general partner or joint venturer or syndicate member or cotenant, if Consultant is a partnership or joint venture or syndicate or cotenancy, which shall result in changing the control of Consultant, shall be construed as an assignment of this Agreement. Control means fifty percent (50%) or more of the voting power of the corporation. 12. SUBCONTRACTOR APPROVAL: Unless prior written consent from City is obtained, only those people and subcontractors whose names and resumes are attached to this Agreement shall be used in the performance of this Agreement. In the event that Consultant employs subcontractors, such subcontractors shall be required to furnish proof of workers' compensation insurance and shall also be required to carry general, automobile and professional liability insurance in reasonable conformity to the insurance carried by Consultant. In addition, any work or services subcontracted hereunder shall be subject to each provision of this Agreement. 13. PERMITS AND LICENSES: Consultant, at his/her sole expense, shall obtain and maintain during the term of this Agreement, all appropriate permits, certificates and licenses including, but not limited to, a City Business License, that may be required in connection with the performance of services hereunder. 14. RECORDS: Consultant shall maintain complete and accurate records with respect to sales, costs, expenses, receipts and other such information required by City that relate to the performance of services under this Agreement. Consultant shall maintain adequate records of services provided in sufficient detail to permit an evaluation of services. All such records shall be maintained in accordance with generally accepted accounting principles and shall be clearly identified and readily accessible. Consultant shall provide free access to such books and records to the representatives of City or its designees at all proper times, and gives City the right to examine and audit same, and to make transcripts therefrom as necessary, and to allow inspection of all work, data, documents, proceedings and activities related to this Agreement. Such records, together with supporting documents, shall be kept separate from other documents and records and shall be maintained for a period of three (3) years after receipt of final payment. If supplemental examination or audit of the records is necessary due to concerns raised by City's preliminary examination or audit of records, and the City's supplemental examination or audit of the records discloses a failure to adhere to appropriate internal financial controls, or other breach of contract or failure to act in good faith, then Consultant shall reimburse City for all reasonable costs and expenses associated with the supplemental examination or audit. 15. NOTICES: All notices, demands, requests or approvals to be given under this Agreement shall be given in writing and conclusively shall be deemed served when delivered personally or on the second business day after the deposit thereof in the United States Mail, postage prepaid, registered or certified, addressed as hereinafter provided. All notices, demands, requests, or approvals from Consultant to City shall be addressed to City at: City of Cupertino 10300 Tone Ave. Cupertino CA 95014 Attention: Acting City Manager All notices, demands, requests, or approvals from City to Consultant shall be addressed to Consultant at: Peckham & McKenney 6700 Freeport Boulevard, Suite 203 Sacramento, CA 95822 Attention: Bobbi Peckham 16. TERMINATION: In the event Consultant fails or refuses to perform any of the provisions hereof at the time and in the manner required hereunder, Consultant shall be deemed in default in the performance of this Agreement. If such default is not cured within the time specified after receipt by Consultant from City of writte:l notice of default, specifying the nature of such default and the steps necessary to cure such default, City may terminate the Agreement forthwith by giving to the Consultant written notice thereof. City shall have the option, at its sole discretion and without cause, of terminating this Agreement by giving seven(7) days' prior written notice to Consultant as provided herein. Upon termination of this Agreement, each party shall pay to the other party that portion of compensation specified in this Agreement that is earned and unpaid prior to the effective date of termination. 17. COMPLIANCES: Consultant shall comply with all state or federal laws and all ordinances, rules and regulations enacted or issued by City. 18. CONFLICT OF LAW: This Agreement shall be interpreted under, and enforced by the laws of the State of California excepting any choice of law rules which may direct the application of laws of another jurisdiction. The Agreement and obligations of the parties are subject to all valid laws, orders, rules, and regulations of the authorities having jurisdiction over this Agreement (or the successors of those authorities.) Any suits brought pursuant to this Agreement shall be filed with the courts of the County of Santa Clara, State of California. 19. WAIVER: A waiver by City of any breach of any term, covenant, or condition contained herein shall not be deemed to be a waiver of any subsequent breach of the same or any other term, covenant, or condition contained herein, whether of the same or a different character. 20. INTEGRATED CONTRACT: This Agreement represents the full and complete understanding of every kind or nature whatsoever between the parties hereto, and all preliminary negotiations and agreements of whatsoever kind or nature are merged herein. No verbal agreement or implied covenant shall be held to vary the provisions hereof. Any modification of this Agreement will be effective only by written execution signed by both City and Consultant. 21. INSERTED PROVISIONS: Each provision and clause required by Law to be inserted into the Agreement shall be deemed to be enacted herein, and the Agreement shall be read and enforced as though each were included herein. If through mistake or otherwise, any such provision is not inserted or is not correctly inserted, the Agreement shall be amended to make such insertion on application by either party. 22. CAPTIONS: The captions in this Agreement are for convenience only, are not a part of the Agreement and in no way affect, limit or amplify the terms or provisions of this Agreement. IN WITNESS WHEREOF, the parties have caused the Agreement to be executed. CONSULTANT CITY OF CUPERTINO PECKHAM& McKENNEY A Municipal Corporation /4 J . 4,7%,v Bobbi Peckham Dave Knapp Partner City Manager Date 0/z• /,L._ Date 3. 2$ . t AP OVED AS TO FORM: Carol Korade CC"-- City Attorney Exhibit A 1. Project Organization: Development of City Manager Candidate Profile a. Meeting to discuss candidate profile and formalize project schedule b. Finalize candidate profile with City and identify "fit" required c. Develop advertising and recruit:ng plan d. Prepare marketing brochure 2. Recruitment of City Manager candidates: a. Advertise, network, electronically post in appropriate venues b. Send marketing brochure to 300-400 industry professionals c. Post opportunity on firm's web site d. Search for/identify/recruit individuals within the parameters of profile e. Respond to all inquiries and acknowledge all resumes received 3. Preliminary Interviews/Recommendation a. Review candidates' resumes and supplemental questionnaires b. Conduct preliminary interviews with leading candidates c. Conduct first-tier reference checks d. Present written recommendation of finalists to Mayor and City Council e. Notify all candidates of search status 4. Final Interviews/Selection a. Schedule finalist candidate interviews b. Design process and facilitate finalist interviews with City c. Assist City throughout process and provide recommendations 5. Qualification a. Conduct background checks and second"tier"references b. Negotiation assistance 6. Placement Guarantee: A one-time replacement recruitment process including all of the above services will be provided by Consultant in the event a candidate recruited and recommended by Consultant is hired by City and leaves employment with the City for any reason within the first two years (except in the event of budgetary cutbacks or position elimination).