CONSTRUCTION COMPANY, INC.

Transcription

1 Exhibit F to Construction Subcontract Agreement CONSTRUCTION COMPANY, INC. GENERAL CONDITIONS OF THE CONSTRUCTION SUBCONTRACT AGREEMENT Signature: Title/Date

2 General Conditions of the Construction Subcontract Agreement INDEX Page 1. THE CONTRACT DOCUMENTS ENTIRE AGREEMENT DEFINITIONS PAYMENTS TO SUBCONTRACTOR SCHEDULES AND SUBMITTALS TIME WORKMANSHIP AND PERFORMANCE OF THE SUBCONTRACT WORK COMPLIANCE WITH FEDERAL, STATE AND LOCAL LAWS LABOR MAINTENANCE OF THE SITE AND THE SUBCONTRACT WORK USE OF CONTRACTOR S AND SUBCONTRACTOR S FACILITIES CHANGES IN THE SUBCONTRACT WORK INDEPENDENT CONTRACTOR PAYMENTS BY SUBCONTRACTOR; EVIDENCE OF PAYMENT CONTRACT DRAWINGS AND SPECIFICATIONS INSURANCE INDEMNIFICATION DEFAULT BY SUBCONTRACTOR TERMINATION OF SUBCONTRACT DISPUTES GUARANTEE MISCELLANEOUS /2007

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4 CONSTRUCTION COMPANY, INC North Third Avenue, Phoenix, Arizona (V.C88106.com.a.z) ROC Class B-01

5 GENERAL CONDITIONS OF THE CONSTRUCTION SUBCONTRACT AGREEMENT 1.0 THE CONTRACT DOCUMENTS: 1.1 The Contract Documents, all of which are incorporated herein, shall consist of the General Contract (as defined in Section 3.1 below) Construction Subcontract Agreement to which these Conditions (as defined below) are attached, and all amendments and change orders issued pursuant to the terms of these Conditions; such Exhibits and other attachments as may be attached to the Construction Subcontract Agreement; these General Conditions of the Construction Subcontract Agreement (the "Conditions"); the advertisement and the information to bidders, the bid or proposal, the plans and specifications; the contract drawings and details and all addenda, alternates, modifications and amendments thereto; and the notice of award, all of which are incorporated herein (collectively, the "Contract Documents" or the "Subcontract"). 1.2 In the event of any conflict between the provisions of this Subcontract and the provisions of the General Contract (as defined in Paragraph 3.1 below), the provisions of this Subcontract shall control. In addition, in the event of any conflict between the provisions of any advertisement, information to bidders, bid, proposal or notice of award and the provisions of these Conditions, the provisions of these Conditions shall control. 2.0 ENTIRE AGREEMENT: This Subcontract constitutes the entire agreement between the parties with respect to the subject matter hereof and may not be altered or amended orally. No estimate or bid of Subcontractor preceding this Subcontract, and no verbal agreement or conversation with any representative of Owner, Architect/Engineer, or Contractor (all as defined in the Construction Subcontract Agreement), either preceding or following the execution of this Subcontract, shall affect, amend or modify any of the terms or obligations contained in this Subcontract. 3.0 DEFINITIONS: 3.1 General Contract: The agreement between Owner and Contractor for construction of the Work involved in the Project. 3.2 Work: All work required to be performed by Contractor pursuant to the terms of the General Contract, including the Subcontract Work. 3.3 Site: The real property on which the Work is to be constructed, as more particularly described in the Contract Documents. 3.4 Subcontract Work: All work required to be performed by Subcontractor pursuant to the terms of this Subcontract and generally described in the Construction Subcontract Agreement and Paragraph 1.1 above. 3.5 Contract Schedule: Contractor's schedule for performance of the Work, to which Subcontractor agrees to be bound in accordance with Paragraph 5.2 below. 3.6 Subcontract Price: The price Contractor agrees to pay to the Subcontractor for the performance by Subcontractor of the Subcontract Work, as more particularly specified in the Construction Subcontract Agreement. 3.7 Working Day: For purposes of this Subcontract, working day shall mean Monday through Friday (except holidays) and any day that Contractor has announced that work will be performed at the Site. 4.0 PAYMENTS TO SUBCONTRACTOR: 4.1 Contractor shall pay Subcontractor the Subcontract Price and other amounts that may become due to Subcontractor under this Subcontract on a percentage of completion basis, as determined by Contractor and, if Owner has reserved a right to so determine, by Owner (or Architect/Engineer or other designee of Owner), when (as provided in Section 4.5 hereof) and if Contractor receives payment in unrestricted funds from Owner, for the Subcontract Work completed by Subcontractor; provided, however, that (a) Contractor may retain as partial security for Subcontractor's fulfillment of its obligations under this Subcontract an amount equal to ten (10%) percent of Subcontractor's gross billing, or such other amount as is set forth in the Construction Subcontract Agreement, (b) payments by Contractor to Subcontractor are to be made only and exclusively from the funds paid by Owner to Contractor and unrestricted funds for the Subcontract Work performed by Subcontractor, (c) Contractor's obligation to make payments to Subcontractor is expressly conditioned in the case of each payment on Contractor's receipt of payment in unrestricted funds from Owner, and (d) no grounds exist for withholding payment under Paragraph 4.4 1

6 hereof. Subcontractor specifically assumes the risk of nonpayment to it if and to the extent Owner fails to pay Contractor. Contractor s receipt of payment in unrestricted funds from Owner is a condition precedent to Contractor s obligation to make payments to Subcontractor; Subcontractor understands that the only source and fund for any payment under this Construction Subcontract Agreement, including progress payments, extra work and final payment, shall be the corresponding payment made by Owner to Contractor under the General Contract. Subcontractor specifically assumes the risk of nonpayment to it if and to the extent Owner fails to pay Contractor. Subject to the foregoing, as long as Subcontractor is in compliance with this Subcontract, Contractor shall pay Subcontractor each progress payment within seven days after receipt by Contractor of Contractor's payment from Owner in the form of unrestricted funds not subject to adjustment by audit. Final payment to Subcontractor shall be made by Contractor when and as Contractor receives its final payment from Owner, subject to the provisions of Paragraphs 4.4 and 4.5 below. Contractor (at and in its sole and unfettered discretion) may (but shall not be obligated to) make partial release of retention to Subcontractor prior to receipt of a Certificate of Substantial Completion duly executed by Owner and Architect; however, Contractor shall not be obligated to release any retention to Subcontractor prior to receipt of the Certificate of Substantial Completion and Owner s written acceptance of the Project, even if Contractor has received retention funds from Owner. Within ten days after this Subcontract is signed, and no fewer than 30 days before submission of its first invoice, Subcontractor shall submit an itemized breakdown in a form and content satisfactory to Contractor of the Subcontract Price (the "Schedule of Values"), in format and detail acceptable to the Contractor (generally AIA Form G703). At Contractor's request, new Schedules of Values shall be prepared from time to time by Subcontractor to reflect the issuance of change orders or any other new conditions perceived by Contractor to require such new Schedules of Values. Acceptance of final payment by Subcontractor shall constitute a waiver of claims except those previously made in writing and identified as unsettled at the time of final application for payment. 4.2 By the 25th day of each month, or such other time as may be agreed to in advance in writing by Contractor and Subcontractor, Subcontractor shall prepare and present to Contractor for Contractor's approval, a monthly invoice showing the amount due or to become due to Subcontractor for the period beginning on the first day of that calendar month to and including the last day of that calendar month, or such other period as may be specified by Contractor to Subcontractor. Each invoice shall contain the following and any other information specified by Contractor: (A) A statement of the current Subcontract Price, including change orders issued and approved; (B) (C) (D) The percentage of completion of each item of Subcontractor's Subcontract Work as shown on the Schedule of Values; Acknowledgment of the total of all moneys received on account of the Subcontract to and including the payment applied for in the presented monthly invoice; The net amount due for the current period after deducting the retainage provided for in this Subcontract; (E) If required by Contractor, the names, addresses and telephone numbers of all sub-subcontractors, suppliers and materialmen who have supplied labor, materials, equipment and services to the Site at the direction of Subcontractor or on Subcontractor's behalf during said month in excess of $500 together with documentation (which may include properly certified and correct invoices in duplicate) sufficient to establish the amount that will be owed to them by Subcontractor as of the end of said month; the information provided in this subparagraph 4.2(E), upon Contractor's request, shall be provided by Subcontractor in a sworn statement; and (F) All other information and documents, in the form required by Contractor, which Contractor requires in order to comply with the General Contract or which Contractor otherwise requires in order to facilitate the completion of the Work. 2

7 The Subcontractor shall attach to its invoice a statement of any backcharges and credits to which Contractor is entitled; and a statement of any claim for charges or extras due to Subcontractor pursuant to the provisions of Paragraph 6.4 below. In addition: (I) Subcontractor shall include with each invoice a release and waiver of lien and supplier affidavit forms, all in form and content satisfactory to Contractor (including with respect to materials covered in subparagraph 4.2 (iii) below) from all laborers, materialmen and sub-subcontractors; (ii) Subcontractor's monthly invoice shall include changes in Subcontract Work and Contractor's change order numbers only after Subcontractor has complied with the procedure set forth in Paragraph 12 below for incorporating changes into the Subcontract Work; and (iii) Subcontractor may bill Contractor for materials not yet incorporated into the Subcontract Work, but delivered and suitably stored at the Site, or at some other location agreed to in writing by Contractor, only if Contractor is permitted to bill Owner for such materials under the General Contract, and Subcontractor complies with such other requirements as may be imposed on it by Contractor. If Subcontractor fails to prepare and present the monthly invoice to Contractor in a timely manner as provided in this Paragraph 4.2, or prepares and presents to Contractor an incomplete or improper monthly invoice, Contractor shall not be responsible for making or required to make progress payments for the month to which the invoice relates, and may defer the payment to the following month, at which time Subcontractor shall again be required to comply with the provisions of this Paragraph 4.2. At Contractor's sole option and discretion, but without any obligation whatsoever to do so, Contractor, instead of deferring the payment, may include in its monthly invoice to Owner for Work performed during the preceding month such amount as it deems proper for the Subcontract Work for the preceding month and Subcontractor agrees to accept any approved portion thereof in lieu of the monthly payment otherwise payable to it. 4.3 Contractor shall have the right to deduct from all the amounts payable to Subcontractor under this Subcontract any amounts due to Contractor by Subcontractor pursuant to any provision of this Subcontract or any other Subcontract between Contractor and Subcontractor. 4.4 Contractor may withhold monthly progress payments, in whole or in part, in order to protect Contractor and/or Owner from loss because of: (A) Defective work (or work not in conformance to that portion of the Contract Documents applicable to Subcontractor) not remedied, materials not furnished, clean-up not performed or any other non-complying aspects of the Subcontract Work; (B) Claims, demands, levies, attachments, stop notices or court orders filed or which Contractor believes are likely to be filed, including claims covered by insurance until such claims are accepted by the insurance carrier; (C) Failure of Subcontractor to make timely and proper payments for materials, to its subcontractors or for labor (including fringe benefits owed and payments due under collective bargaining agreements), or equipment, transportation or shipping costs, taxes, fees or any other claims of any nature growing out of the Subcontract Work; (D) Reasonable indication that the Subcontract Work will not be completed for the then-remaining unpaid balance of the Subcontract Price or completed in compliance with the Contract Schedule; (E) Unsatisfactory prosecution of the Subcontract Work by Subcontractor (including without limitation, failure to prosecute the work on a timely 3

8 (F) (G) (H) (I) (J) (K) (L) (M) (N) basis so as to comply with the Project Schedule (Exhibit J ); Failure to deliver to Contractor releases, lien waivers, supplier affidavit forms, insurance certificates, bonds, "as built" drawings, written guarantees or warranties or the approvals of the Subcontract Work required by any authority having jurisdiction; Damage to any portion of the Work, any other subcontractor s Work or equipment or materials of Owner, damage to another contractor or subcontractor, Owner and/or Contractor; Filing by or against Subcontractor of a petition for bankruptcy or reorganization; Costs relating to remedial work performed by Contractor or another subcontractor as the result of any defect, or deficiency in the subcontract work, or the failure to cause the subcontract work to be properly and timely completed; Any claim or potential claim under any law related to the protection of human health or the environment, including without limitation any such claim related to a release of any hazardous substance, hazardous waste, or other pollutant or contaminant on the Site; Any other conditions of any nature which arise in connection with the Subcontract Work which, in Contractor's reasonable opinion, will result in loss to Owner and/or Contractor; Disputed work or materials; Failure of the Subcontractor to comply with any material provision of the Construction Subcontract Agreement; Any other conditions of any nature which arise in connection with the Subcontract Work which, in Contractor s reasonable opinion, will result in loss to Owner and/or Contractor. If any of the foregoing reasons for withholding payment occur after Owner pays Contractor and before Contractor pays Subcontractor, Contractor may, but shall not be required to, (a) return sufficient funds to Owner to protect Owner and/or Contractor from loss, or (b) segregate such funds from Contractor s other funds by opening a separate account in Contractor s name. The above right of Contractor to withhold monthly progress and other payments of Subcontractor shall remain in effect even though the Subcontractor has posted full payment and performance bonds. When the grounds set forth in subparagraphs 4.4(A) through (K) above are removed by Subcontractor to the satisfaction of Contractor, payments for the amounts so withheld will be made by Contractor pursuant to the procedures set forth elsewhere in this Paragraph 4. However, as a condition to resuming such payments, Contractor may require that Subcontractor furnish releases in a form satisfactory to Contractor for all claims made under subparagraphs 4.4(B) and (C) above and/or supporting invoices, receipts or other records satisfactory to Contractor to substantiate the amounts owed or paid. 4.5 The balance of the Subcontract Price and any other amounts owed to Subcontractor under the terms of this Subcontract shall be due and payable when all of the following have occurred: (i) completion and acceptance of the Work by Owner as represented by an unconditional Certificate of Substantial Completion duly issued and executed by Owner and signed by Architect, (if the Architect s signature is required by Owner), (ii) within 7 (seven) days following receipt by Contractor from Owner of the entire amount, including without limitation, all retentions and the final payment, due to Contractor from Owner, (iii) removal of any grounds for withholding payments under Paragraph 4.4 above, (iv) receipt by Contractor of satisfactory proof that all claims, including taxes, growing out of the Subcontract Work (and any liens related thereto) have been released, and (v) receipt by Contractor of satisfactory proof that all labor, including fringe benefits owed and payments due under collective bargaining agreements, and all Subcontractor's subcontractors and materialmen have been paid and are waiving their lien rights upon the final payment of the specific balance due. If any causes for withholding payment under subparagraphs 4.4(A) 4

9 through (J) above are not removed on written notice, Contractor may declare a default under this Subcontract and shall have all the remedies provided in Paragraph 18 below. If minor items remain to be completed by Subcontractor, Contractor may retain a sum equal to two hundred percent (200%) of Contractor's estimated cost of completing any unfinished items. 4.6 Any and all funds payable to Subcontractor under this Subcontract shall, when received by the Subcontractor, constitute trust funds in the hands of Subcontractor, and upon receipt, all funds received shall be applied by Subcontractor first, to the payment of labor costs and related taxes and fringe benefits; second, to claims of Subcontractor's subcontractors, architects, engineers, surveyors, and materialmen arising out of the Subcontract Work; third, to claims for utilities furnished and taxes imposed; fourth, to the payment of premiums on surety bonds and other bonds filed and premiums on insurance accruing during the construction of the Subcontract Work; and fifth, to the payment of all other expenses associated with the Subcontract Work. All of the foregoing shall be satisfied by Subcontractor before Subcontractor applies any funds received by Subcontractor for any other purpose or purposes. 4.7 Contractor shall pay the Subcontract Price in current funds and in the manner and at the times set forth in this Subcontract. The Subcontract Price includes adequate quantities of material and labor (direct and indirect) to accomplish all Subcontract Work and the Contract Schedule and is intended to include and does include all increases in cost, foreseen or unforeseen, including without limiting the generality of the foregoing, taxes, labor, materials, and transportation costs, all of which are to be borne solely by Subcontractor. Subcontractor acknowledges that all of Subcontractor s costs have been included in the Subcontract Price and Subcontractor shall have no claim for loss of productivity. Further, Subcontractor has included all costs for materials handling, hoisting and storage in amounts necessary to accommodate the contract Schedule which is made a part of this Construction Subcontract Agreement. Any loss, expense or damage arising from any of the Subcontract Work performed under this Subcontract, from unforeseen or unusual obstructions, difficulties or delays which may be encountered in the prosecution of the Subcontract Work, or through the action of the elements or through any other condition or event beyond the control of Subcontractor shall be borne by Subcontractor. Nothing contained in this Paragraph shall preclude Subcontractor from pursuing any remedy it may have at law or in equity in the event such loss, expense or damage was caused by the gross negligence or willful misconduct of any other person or entity. 4.8 No payment made under this Subcontract, nor any partial or entire use or occupancy of the Project (as defined in the General Contract) or any part thereof by Owner, shall be evidence that the Subcontractor has performed its obligations under this Subcontract, either wholly or in part, nor shall such payment, use or occupancy be construed as an acceptance of defective work or improper materials, or an approval of any of the items in any requisition made or bill rendered. 4.9 Acceptance of final payment by Subcontractor shall constitute a release and waiver by Subcontractor of all claims that Subcontractor has or may have against Contractor, Contractor's surety, Owner or Architect/Engineer. Nothing contained in this Paragraph 4.9 shall affect Subcontractor's rights against persons and entities other than Contractor, Contractor's surety, Owner or Architect/Engineer if, after its acceptance of the final payment, Subcontractor is sued or claimed against by any other person or entity, with respect to its performance of the Subcontract Work. 5.0 SCHEDULES AND SUBMITTALS: 5.1(a) Subcontractor warrants that it has reviewed all specification sections and project drawings listed in Exhibit "A, and, by execution of the Subcontract, Subcontractor affirms that the Subcontract Price includes all Subcontract Work including but not limited to all costs for material handling to accommodate the Contract Schedule. 5.1(b) Subcontractor shall carefully study and compare the Contract Documents with each other, with information furnished to the Subcontractor by the Contractor, and with other information known to Subcontractor, and shall at once report to Contractor any errors, inconsistencies, or omissions discovered by Subcontractor. Subcontractor shall determine and verify materials, take field measurements, verify field conditions, carefully compare such field measurements and conditions and other information known to Subcontractor with the Contract Documents before commencing performance of Subcontract Work and shall report at once to 5

10 Contractor any errors, inconsistencies, or omissions discovered by Subcontractor. 5.2(a) Within ten days following the execution of the Subcontract, Subcontractor shall deliver to Contractor a proposed schedule for performance of the Subcontract Work, including delivery dates for materials and equipment, which shall be subject to reasonable approval by Contractor and shall be in conformity with the time and sequencing of Subcontractor s work set forth in Exhibit J hereto (the "Contract Schedule"). In the event Subcontractor fails to submit such information within the ten day period, Contractor will establish the Contract Schedule for Subcontractor and Subcontractor shall be bound thereby. Subcontractor agrees to be bound by the Contract Schedule. Subcontractor shall submit, with its proposed schedule, information showing the time required for preparation and approval of shop drawings, fabrication and delivery of materials and equipment and installation of the Subcontract Work. 5.2(b) Subcontractor represents it has used adequate amounts of material and labor (direct and indirect) to accomplish on a timely basis the Contract Schedule. 5.2(c) Subcontractor will provide coordination and cooperation with all other trades as required to complete the work in accordance with the Contract Schedule. 5.3(a) Within thirty days following the execution of the Subcontract, Subcontractor will prepare and submit for approval all shop drawings, details, samples, equipment data and a list of materials showing the name, address and telephone number of the supplier and the date on which such equipment and material is expected to be delivered to the Site, or other submittal information as required for the performance of the Subcontract Work. 5.3(b) Prior to making any submittal referred to in this Paragraph 5.3, Subcontractor shall determine and verify materials, field measurements and field construction criteria related to the submittal, and will check and coordinate the information contained within the submittal with the requirements of the Contract Documents. Further, Subcontractor shall specifically inform Contractor in writing of any work included in the submittals which is to be performed by others, and any deviation in its submittals from requirements of the Contract Documents at the time of submittal, and shall direct specific attention, in writing or on resubmittals, to revisions other than those requested by the Architect/Engineer on previous submittals. 5.4 Subcontractor shall furnish at no additional cost all drawings, samples, models, schedules, catalog cuts, test results, certificates and other documentation necessary or incidental to the proper coordination and performance of the Work. Such items shall be furnished in a timely manner so that the orderly progress and timely completion of the Work will not be delayed, and will be performed in accordance with the Contract Schedule, or upon Contractor's request. The checking and approval of such submitted items by Contractor, the Architect/Engineer or their agents and subcontractors shall not relieve Subcontractor from responsibility for errors and omissions in the data or material submitted. 5.5 If Contractor so requests, Subcontractor shall furnish Contractor, upon issuance, a copy of each major purchase order and subcontract (with price information deleted) and shall prepare a schedule (and, if further requested by Contractor, shall update it weekly or otherwise, as mutually agreed to by Subcontractor and Contractor) of all equipment and materials to be furnished and incorporated into the Subcontract Work by Subcontractor. The schedule shall contain the following information: (A) (B) (C) (D) (E) Date and amount of purchase; Manufacturer and manufacturer's location; Shipping date; Current status of manufacture; Date delivery is due at Site. If a schedule is requested, Subcontractor shall obtain Contractor's approval prior to proceeding with the Subcontract Work and shall adhere to the Contract Schedule in undertaking the Subcontract Work. 5.6 Subcontractor agrees that it will keep itself and Contractor continually informed about the progress of the Subcontract Work and, upon its own initiative, will confer with Contractor and will plan and 6

11 execute the Subcontract Work in coordinated sequence with the Work of Contractor and/or with the work of all other contractors and subcontractors so as to insure the timely and efficient completion of the Work. Subcontractor will not, however, proceed with any phase of the Subcontract Work in advance of the time designated in the Contract Schedule unless authorized to do so by Contractor in writing. Subcontractor shall notify Contractor when portions of the Subcontract Work are ready for inspection. 5.7 Subcontractor shall cause a qualified home or local office supervisory representative to attend weekly progress meetings commencing prior to the start of the Subcontract Work and continuing throughout the progress of the Subcontract Work, until the Subcontract Work has been completed and the Subcontractor no longer has any employees or equipment at the Site. 5.8 From time to time during the progress of the Work, Contractor shall have the right to revise the Contract Schedule to accommodate changes in conditions affecting the Work or as deemed by Contractor to be necessary or convenient to the overall progress of the Work. Subcontractor shall adjust its operations to conform to all Contract Schedule changes, agrees to make no claim for acceleration or delay by reason of the revisions as long as the revisions are typical in nature taking into account the scope and complexity of the Work, agrees to make no claim for loss of productivity by reason of the revisions or on any other basis, and hereby releases and discharges Contractor from any liability for damages or expenses which may be caused to or sustained by Subcontractor by reason of any changes or delays caused by Contractor; provided, however, that the time allowed for the Subcontract Work in the original Contract Schedule shall not be substantially reduced by Contractor unless mutually agreed by Contractor and Subcontractor. Contractor shall have complete control of the Site and shall have the right to decide the time and order in which the various portions of the Subcontract Work shall be installed, the priority of the work of other subcontractors and, in general, all matters respecting the timely and orderly conduct of the Work on the Site. If the Work is divided into parts, Subcontractor will perform several or all parts simultaneously if required by Contractor. 6.0 TIME: 6.1 Time is of the essence of this Subcontract. Subcontractor agrees to punctually and diligently perform all parts of the Subcontract, including without limitation the performance of the Subcontract Work, in accordance with the Contract Schedule. Without limiting the generality of the foregoing, the Subcontractor shall perform the Subcontract Work in accordance with the Contract Documents and submittals, at such a rate and in such a manner as not to delay any other items of the Work, the Contract Schedule, or the final completion of the Project. 6.2 Subcontractor shall begin the Subcontract Work within seven days after receipt of written notice to proceed from Contractor and shall thereafter perform the Subcontract Work continuously and expeditiously in accordance with the requirements of this Subcontract as determined by Contractor. 6.3 Notwithstanding the fact that a dispute, controversy or question shall have arisen in (1) interpretation of any provision of this Subcontract, (2) performance of any portion of the Subcontract Work, (3) delivery of any materials, (4) payment of any moneys to Subcontractor, or (5) any other dispute with respect to performance under this Subcontract, Subcontractor agrees that it will not directly or indirectly stop or delay the Subcontract Work, or any part thereof, or stop or delay the delivery of any materials on its part required to be furnished under this Subcontract pending the determination of such dispute or controversy, regardless of whether such dispute, controversy or question is or may be subject to arbitration or other form of dispute resolution. 6.4 If Subcontractor is not in default under any of the provisions of the Subcontract and if, in order to expedite the final completion of the Work or any extra or special work on the Project, Contractor directs Subcontractor to work overtime or multiple shifts, Subcontractor shall work the overtime or multiple shifts directed by Contractor. Contractor shall pay for overtime or multiple shifts directed by it only the actual extra cost over the rate for regular time. No overhead or profit shall be charged by Subcontractor for overtime or shift work, and Subcontractor agrees to make no claim for loss of productivity by reason of Contractor s direction to Subcontractor to work overtime or multiple shifts. Time slips covering overtime and shift work directed by Contractor shall be submitted by Subcontractor to be approved daily by Contractor's authorized agent at the Site. 7

12 6.5 If Subcontractor becomes aware of circumstances relating to the Subcontract Work that may cause a delay in the Contract Schedule, including without limitation delays in the manufacture and/or delivery of materials or equipment, Subcontractor shall immediately give written notice of such circumstances to Contractor. Contractor shall have the right directly or through Subcontractor to investigate such delay and to request that Subcontractor institute action at Subcontractor's expense to prevent or mitigate any delay, including requiring that the manufacture and/or delivery of materials or equipment be expedited. 6.6 If Subcontractor (A) (B) fails or refuses to prosecute the Subcontract Work in strict accordance with the Contract Schedule, as such may be revised from time to time pursuant to these Conditions, fails or refuses to supply sufficient skilled workmen, (C) fails to cause materials or equipment to be delivered to the Site in accordance with the Contract Schedule, (D) (E) (F) fails to commence, perform, finish or deliver different parts of the Subcontract Work in accordance with the Contract Schedule, performs work which fails or causes damage to the equipment, materials or property of Owner, Contractor or other subcontractors, otherwise defaults in its obligations under this Subcontract, upon two working days' notice, Contractor shall have the right to require Subcontractor to furnish additional labor and to expedite the delivery or availability of materials and equipment at Subcontractor's sole cost and, if such additional labor is not available, Contractor shall have the right to require Subcontractor, at Subcontractor's sole cost and expense, to work overtime or multiple shifts (and/or weekends and holidays) to such an extent as will be sufficient, in Contractor's opinion, to accelerate and complete the Subcontract Work in accordance with the Contract Schedule. 6.7 In addition to Subcontractor's liability pursuant to Paragraph 6.6 above, if Subcontractor fails or defaults in any manner provided in subparagraphs 6.6(A) through (E), Subcontractor shall be liable to Contractor for any and all losses, expenses or damages suffered by Contractor, including liquidated or consequential damages suffered therefor or premiums or bonuses for early completion lost thereby by Contractor. If the failure or delay was not the fault of Subcontractor, but rather the result of an act of the public enemy; labor disputes; fire, earthquake, explosion, or other extraordinary actions of weather or the elements; invasion, war, insurrection, or sabotage; failure of transportation; lockouts; actions of labor unions; laws or orders of governmental, civil, military or naval authorities; governmental restrictions; enemy actions; riot or civil commotion; or unavoidable casualty or other reasons beyond the control of Subcontractor, Subcontractor shall not be liable for any of the losses, expenses or damages suffered by Contractor if (1) Subcontractor gives written notice of the failure or delay to Contractor within two days following the start of the occurrence, including a statement of efforts being expended by Subcontractor or on its behalf to overcome any such occurrence, and (2) such failure or delay is valid grounds for an extension of time by Contractor under the General Contract. Subcontractor shall exercise all due diligence to overcome any occurrence causing a failure of or delay in the performance by Subcontractor of the Subcontract Work. Contractor shall not be liable to Subcontractor for and Subcontractor hereby releases and discharges Contractor from losses or damages resulting from the causes described above, or for Contractor's delay, or for any modification or extension of the Contract Schedule made by Contractor, or for losses or damages resulting from hold or change orders issued by Owner, or for delays caused by other subcontractors or materialmen. 6.8 In view of the difficulty or impossibility of determining Contractor's damage if Subcontractor fails to complete the Subcontract Work within the Contract Schedule, Subcontractor shall pay to Contractor, unless otherwise indicated on Exhibit "C" attached to the Construction Subcontract Agreement, in addition to all other sums 8

13 Subcontractor is obligated to pay pursuant to this Subcontract, the amount per day specified in Exhibit "C" attached to the Construction Subcontract Agreement, for each calendar day of delay beyond the scheduled time of completion of the Subcontract Work, as liquidated damages and not as a penalty. Any liquidated damages payable by Subcontractor to Contractor shall be deducted from the balance of the Subcontract Price due Subcontractor. If liquidated damages exceed the Subcontract Price due or to become due to Subcontractor, the Subcontractor shall pay to Contractor the difference between the liquidated damages and the Subcontract Price immediately upon written demand from Contractor. 6.9 Contractor shall have the right, from time to time and at any time, to employ or designate one or more representatives to assist Contractor in fulfilling any of its rights under this Subcontract Agreement. 7.0 WORKMANSHIP AND PERFORMANCE OF THE SUBCONTRACT WORK: 7.1 Subcontractor warrants that it has inspected the Site and has satisfied itself about all conditions affecting the Subcontract Work and the meaning and intention of this Subcontract. 7.2 Subcontractor shall be strictly responsible for providing all required layout and engineering for, and performance of, the proper layout, location, and accuracy of the lines and levels required by the Subcontract Work, for notifying Contractor immediately about any discrepancies from the established line and grade, and for any loss or damage to other contractors and subcontractors engaged in Work on the Site by reason of Subcontractor's negligence or fault or failure of Subcontractor to set out or perform the Subcontract Work correctly and coordinate his work with the work of others. Subcontractor shall so lay out and perform the Subcontract Work that actual final conditions and details result in alignment of finish surfaces in accordance with the Contract Documents. 7.3 Every part of the Subcontract Work shall be executed in strict accordance with the provisions of this Subcontract in a thorough, first-class, sound, and workmanlike manner. Without limiting the generality of the foregoing, Subcontractor shall at all times have primary duty and responsibility for the safety of its employees, agents and other personnel. Subcontractor shall perform the Subcontract Work under the general direction of Contractor and subject to the satisfaction and final approval of Contractor. If Owner or any other specified representative of Owner or Architect/Engineer possesses any independent approval or supervisory rights with respect to the Work, Subcontractor also agrees to perform the Subcontract Work in conformance with such rights and subject to the satisfaction and final approval of Owner or any such other specified representative of Owner or the Architect/Engineer. Each item of workmanship shall be of the best quality and all material and equipment used in the Subcontract Work shall be furnished in ample quantities to facilitate the proper and expeditious execution of the Subcontract Work and shall be new and the best of its kind, except any materials expressly and specifically provided for in this Subcontract to be otherwise. Subcontractor agrees to furnish at its sole expense, all of the required labor, materials, tools, vehicles, equipment, facilities, hoists, elevators or other equipment required to transport an item vertically, scaffolding, storage facilities and each and every other item of materials, equipment, tools and each and every service necessary, required or incidental to complete the Subcontract Work. 7.4 If the scope of the Subcontract Work requires tasks or functions to be performed on areas constructed or prepared by others, or includes installation of materials or equipment furnished by others, it shall be the responsibility of Subcontractor to examine and approve the areas or items so provided. Use of the items or commencement of the Subcontract Work by Subcontractor on the areas shall constitute acceptance of the items and areas by Subcontractor, and Subcontractor shall thereupon be responsible and liable for any loss, expense or damage attributable to the areas or items, to protect the areas, and to inventory, handle, store and install the items with such skill and care as to insure compliance with this Subcontract. 7.5 Subcontractor shall furnish to Contractor and its representatives ample facilities at all times for inspecting materials at the Site, or at shops, or at any place where materials required for the performance of this Subcontract may be in storage or in the course of preparation, process, manufacture or treatment. Subcontractor shall furnish to Contractor, as often as requested, full reports of the progress of the Subcontract Work at any place where materials required under this Subcontract may be in the course of preparation, process or manufacture, in such detail as may be required by Contractor, including 9

14 any purchase orders, schedules, plans, drawings, or diagrams used in the course of preparation, process or manufacture of such materials. 7.6 Subcontractor will provide, locate and relocate and/or maintain adequate sheds and/or tool boxes as designated by Contractor. Contractor will not be responsible for any of Subcontractor's (or its subcontractors' or materialmen's) clothing, tools, materials, equipment or other items lost, damaged, stolen or destroyed at the Site or elsewhere. Subcontractor shall provide all electrical distribution and lighting required to fulfill Subcontractor s scope of work under this Agreement. 7.7 Contractor and its designees (which may include Owner) shall, at all times, have access to the Subcontract Work wherever it is in preparation or in progress and to all portions of the Site where Subcontractor handles or stores any materials, and Subcontractor shall provide sufficient, safe and proper facilities, labor and material reasonably needed for access and inspection. When any Subcontract Work is being executed away from the Site, Subcontractor shall notify Contractor in reasonable time where the Subcontract Work is to be done and when it will be ready for inspection so that Contractor may, if it so desires, inspect the Subcontract Work from time to time before delivery to the Site. 7.8 Contractor shall have the right to reject materials, workmanship or any other element of the Subcontract Work which is defective or not in conformity with the requirements applicable to the Subcontract Work and to require its correction. Rejected workmanship shall be satisfactorily corrected, rejected materials shall be satisfactorily replaced with proper materials, and other elements shall be brought into conformity with applicable requirements of the Subcontract Work, all at Subcontractor's sole expense. Notwithstanding the previous sentence, Contractor may accept defective Subcontract Work, materials or other elements by express notice in writing, at an appropriate adjustment to the Subcontract Price. Subcontractor shall promptly segregate and remove rejected material from the Site. Subcontractor's failure to appropriately correct, replace or conform the defective, rejected or non-conforming elements shall constitute a default under Paragraph 18 of this Subcontract and Contractor shall have all remedies provided in this Subcontract. If Contractor deems it necessary or advisable to make an examination of the Subcontract Work already completed by Subcontractor by removing it or tearing it out, Subcontractor shall, upon request, promptly furnish all necessary facilities, labor and materials therefor. If all or a portion of the Subcontract Work is found to be defective or nonconforming in any material respect due to the fault of Subcontractor, Subcontractor shall bear all the expenses of the examination and of satisfactory reconstruction. If, however, the Subcontract Work is found to meet the requirements of this Subcontract, Subcontractor shall be compensated for the examination and replacement by an equitable adjustment (if one is appropriate or necessary) in the Subcontract Price and suitable extension of time pursuant to the change order requirements of Paragraph 12 below. 7.9 Subject to the provisions of Paragraph 4.8 above, Owner may have the right to take possession of or use any completed part of the Subcontract Work. If Owner's possession or use delays the progress of the Subcontract Work or causes additional expense to Subcontractor, an equitable adjustment (if one is appropriate and necessary) in the time for completion or in the Subcontract Price, or both, will be made pursuant to the change order provisions of Paragraph 12 below If any dispute arises between Owner and Contractor involving work or material furnished by Subcontractor or Subcontract Work to be performed under this Subcontract by Subcontractor, Subcontractor shall be given notice thereof and a reasonable opportunity to participate in any agreement reached between Owner and Contractor with regard thereto or any arbitration proceeding resulting therefrom. If, however, Subcontractor does not demand in writing within ten days from the receipt of written notice to participate in any agreement or arbitration proceeding, then any award made in accordance with the terms of the General Contract or any arbitration agreement or award made at any time thereafter between Owner and Contractor shall be binding upon Subcontractor All work, labor, services and materials to be furnished by Subcontractor must strictly comply with all applicable federal, state and local laws, rules, regulations, statutes, ordinances and directives (hereinafter Laws ) now in force or hereafter in effect including, but not limited to, the Occupational Safety Health Act of All work, labor, services and materials necessary to comply with Laws will be furnished by Subcontractor without any additional compensation. 10

15 Subcontractor agrees that prevention of accidents to workmen engaged in the work under this Subcontract is solely Subcontractor s responsibility, and Subcontractor shall be fully responsible for the safety of Subcontractor s employees or anyone working directly or indirectly for them. Subcontractor shall comply with all Laws pertaining to safety and a safe working environment including all standards established during performance of Subcontractor s work, as well as Contractor s safety plan. To the extent there is any conflict between Contractor s safety plan and the laws, Subcontractor shall follow the safety practices set forth in the Laws. Contractor s review of any safety plan prepared by Subcontractor hereunder shall not be deemed a release of Subcontractor or in any way diminish Subcontractor s liability, by indemnity or otherwise, assumed by it under this Agreement and applicable law. Chanen s safety plan includes, but is not limited to, the use of hard hats (to be worn at all times), no shorts, no radios, proper footwear, work area cleanliness, and scaffold regulations. A complete safety plan is available at the jobsite trailer. Subcontractor agrees to indemnify, defend and save Contractor harmless from and against any and all claims, loss, liability, damage, cost, awards, judgments, fines or expenses (including litigation expenses and reasonable attorneys fees) caused directly or indirectly by Subcontractor s failure to comply fully with the obligations set forth in paragraph Fire Watch: All Subcontractors are to include a Fire Watch at all times during the course of the work described herein, including the following: (A) (B) (C) All construction employees when using a cutting torch, welding machine, and/or metal cutting blades are required to have a separate person with a wet type fire extinguisher to maintain a constant and continuous watch in the fire danger area. All operating equipment shall have on board at all times a charged fire extinguisher and shove. All operating equipment shall have a complete and functional exhaust system. (D) (E) (F) No smoking will be allowed inside the building once it has been enclosed. The use of any equipment that may produce a spark or significant heat must be done so within reach of a fire extinguisher Should Subcontractor be found not abiding by the fire watch procedure, he shall be requested to have the operator and equipment removed from the jobsite. There will be no warning or exceptions given Subcontractor shall exclusively be responsible and liable for the safety of all its employees and the employees of all its subsubcontractors (if any) and Contractor shall have no responsibility or liability therefore. Subcontractor shall immediately remove and replace, as may be directed by Contractor, any and all defective work performed by Subcontractor. 8.0 COMPLIANCE WITH FEDERAL, STATE AND LOCAL LAWS: 8.1 Subcontractor shall procure and pay for all permits, licenses, approvals, certificates and authorizations necessary for the lawful prosecution and completion of the Subcontract Work. All of the Subcontract Work shall be done in strict accordance and conformity with all applicable laws, ordinances, rules, regulations, orders or requirements of all federal, state, city, county and other authorities having jurisdiction over the Site, the Project or the Work. Subcontractor shall give notices as may be required by the laws. 8.2 Subcontractor shall schedule and coordinate all inspections relevant to the Subcontract Work, shall employ those persons necessary to provide efficient scheduling, coordination and achievement of all required inspections, shall promptly notify the respective regulatory departments or official bodies when any portion of the Subcontract Work is ready for inspection and shall, at once, undertake all tasks required to obtain approvals of the Subcontract Work, to remove any violations therefrom or to comply with such inspections, without any additional charge to Contractor. 11

16 8.3 Subcontractor shall promptly notify Contractor of the outcome of any inspection. In addition, upon discovering or being advised that any portion of the Subcontract Work is or may be in violation or conflict with any laws, ordinances, rules, regulations, orders or requirements of any federal, state, city, county or other authorities, Subcontractor shall provide immediate written notification to the Architect/Engineer and Contractor and, unless otherwise directed by Contractor, shall refrain from proceeding with the portion of the Subcontract Work so affected until instructed to do so by Contractor in writing. Subcontractor will be responsible for all re-inspection fees and penalties associated with the failure of the Subcontract Work. 8.4 Subcontractor shall comply fully, at its own expense, with all applicable federal, state, city and county laws, ordinances, regulations, rules, orders and citations, and industry guidelines applicable to this Subcontract or the Subcontract Work, accident prevention and safety requirements, equipment and practices, in the performance of its Subcontract Work, including but not limited to the requirements provided in the Occupational Safety and Health Act of 1970, and amendments and regulations promulgated and issued pursuant thereto, applicable state safety standards, the Construction Safety Act, the guidelines called for under the latest edition of the Associated General Contractors' Manual of Accident Prevention and Safety Program, and the Civil Rights Act of 1970 as amended, as the same may be further amended or succeeded, and any similar state or local laws. If any expenses are incurred by Contractor or claims made against Contractor in connection with an audit, proposed or actual violation, or a legal or administrative proceeding arising from any conditions, practices, acts or omissions of Subcontractor, Subcontractor shall hold Contractor harmless from and indemnify Contractor against all costs and expenses, including Contractor's attorney's fees, litigation costs and expenses, damages, and penalties which Contractor may incur by reason of Subcontractor's failure to comply with the above standards. 8.5 Subcontractor shall promptly pay and discharge all federal, state, county, city and other governmental taxes, assessments or charges of any kind or nature, now or hereafter imposed, including but not limited to, sales taxes constituting the responsibility of Subcontractor or taxes measured on wages, salaries or other remuneration due or payable to any and all persons employed by Subcontractor in connection with the performance of this Subcontract and all payments due pursuant to any social security acts, unemployment compensation acts and workers' or workmen's compensation acts insofar as applicable to the performance of this Subcontract. 8.6 Subcontractor represents and warrants to and covenants with Contractor that it is duly licensed as a construction contractor for the type of work agreed to be performed by it under this Subcontract; and has all appropriate licenses, both regulatory and revenue, required by all governmental bodies having jurisdiction over Subcontractor on the Project. If Contractor suffers any loss, cost, damage or expense, or if all or any part of Subcontract Price is nondeductible for transaction, privilege, sales, use or other like taxes, on account of Subcontractor's failure to be properly licensed, the additional loss, cost, damage or expense or tax occasioned thereby shall be deducted from the Subcontract Price or, on demand, shall be promptly paid to Contractor by Subcontractor. 8.7 Without limiting the generality of any other obligations of Subcontractor under this Article 8, Subcontractor shall prepare and at all times during the performance of the Subcontract Work implement a hazard communication program meeting all applicable requirements of Title 29 of the Code of Federal Regulations and corresponding state regulations. Subcontractor shall cooperate with Contractor and all other subcontractors and suppliers at the Site with respect to chemical hazards associated with the Subcontract Work so that Contractor and the other subcontractors and suppliers can prepare and implement their own respective hazard communication programs and so that their respective employees are protected from injury or harm related to the chemical hazards associated with the Subcontract Work. 8.8 Without limiting the generality of any other obligations of Subcontractor under this Article 8, Subcontractor shall prepare and at all times during the performance of the Subcontract Work implement a Site Health and Safety Plan meeting all applicable requirements of Title 29 of the Code of Federal Regulations and corresponding state regulations. The Subcontractor's Health and Safety Plan shall include, at a minimum, all provisions necessary to comply with any Health and Safety Plan of Contractor for the Site. Contractor may, at its option, require Subcontractor to submit Subcontractor's Health and Safety Plan to Contractor or Contractor's 12