Service Disabled Veteran Owned Small Business
Providing Design & Construction Services to Commercial Clients, Veterans Administration, DOD, FAA and the National Guard
PURCHASE ORDER TERMS AND CONDITIONS
General Contractor and Subcontractor, in consideration of the mutual covenants and conditions contained herein, and for other valuable consideration, hereby agree to the following terms and conditions of the engagement by General Contractor of Subcontractor to provide and furnish Subcontractor’s Work and fulfill other obligations as hereinafter prescribed.
ARTICLE 1 - SPECIFIC PARAMETERS
1.1 Subcontractor’s Work - Subcontractor shall provide all items, including all labor, materials, Con-struction Services, Delegated Design Services, as applicable, equipment and miscellaneous appurtenances necessary to complete the work indicated in the Contract Documents or reasonably inferable therefrom as necessary to achieve the intended result (“Subcontractor’s Work” or “Work”). Subcontractor shall perform Subcontractor’s Work consistent with the best skill and practices in the industry. Subcontractor represents and warrants that it possesses the experience, expertise, understanding and other qualifications and attributes necessary for the complete performance of Subcontractor’s Work.
Subcontractor’s Work is a portion of the construction and services required of General Contractor to fulfill its obligations pursuant to its agreement between General Contractor and Client (“Prime Contract Agreement”). Subcontractor agrees to be bound to all provisions in the Prime Contract Agreement applicable to Subcon-tractor’s Work. The Prime Contract Agreement, including all general and special conditions, exhibits, drawings, specifications, addendums and modifications and this Subcontract, including all exhibits, adden-dums and modifications collectively constitute the “Contract Documents.” In the event of any conflict or inconsistency between any terms and conditions of the Contract Documents, the conflict or inconsistency shall be resolved by General Contractor acting in its sole and absolute discretion without an increase in the Subcontract Time or Subcontract Amount.
Subcontractor acknowledges and agrees that it has had an adequate opportunity to obtain and review copies of all currently existing Contract Documents and Subcontractor similarly shall make copies of applicable portions of the Contract Documents available to its consultants, sub-subcontractors and suppliers (“Lower-Tier Providers”).
1.2 Subcontract Amount --- As full compensation for Subcontractor’s proper and complete performance of Subcontractor’s Work (including any prior work performed pursuant to interim authorization by General Contractor) in accordance with terms and conditions set forth herein, General Contractor will pay to Subcon-tractor the fixed price indicated in the Purchase Order. (“Subcontract Amount”).
1.3 Retainage --- 10% will be held until final completion and acceptance of Subcontractor’s Work by General Contractor and Client and payment by Client.
1.4 Subcontract Time --- Time is of the essence with respect to the commencement, progress and completion of Subcontractor’s Work. Subcontractor shall strictly adhere to the Project schedule, as may be modified by General Contractor, and achieve the following milestone dates:
Substantial Completion: Indicated in Purchase Order (“Subcontract Time”)
1.5 List of Exhibits --- (Attachments to Purchase Order)
Exhibit A – Scope of Work
Exhibit B – Insurance
Exhibit C – Billing Procedures
ARTICLE 2 – GENERAL RESPONSIBILITIES
2.1 Lower-Tier Providers --- The Subcontractor shall provide General Contractor with an affidavit containing a list of its proposed consultants, subcontractors and suppliers, (notarized, if required by General Contractor), the work that each of them will perform and the amount each of them will be paid. Subcontrac-tor shall submit a new affidavit after any changes to this list occur with Subcontractor’s next application for payment following such a change. Subcontractor must seek General Contractor’s written approval before engaging any proposed consultants, subcontractors and suppliers and may not allow such parties to perform work until approval is received, which may be denied by General Contractor at its sole discretion.
2.2 Investigation and Inspection ---
A. Subcontractor shall make a careful analysis and comparison of the Project site and the drawings, specifications, other Contract Documents and information furnished by the General Contractor and Client relative to Subcontractor’s Work prior to performing any portion of Subcontractor’s Work. Should Sub-contractor discover any errors, inconsistencies or omissions between any of the Contract Documents or between Subcontractor’s site investigation and the Contract Documents, Subcontractor shall report such discoveries to General Contractor in writing within three (3) days. Failure to report discoveries to Gen-eral Contractor within this time shall result in a waiver of all rights to an increase in the Subcontract Time or Subcontract Amount relative to the discoveries. Upon receipt of notice, General Contractor shall instruct Subcontractor as to the measures to be taken and Subcontractor shall comply with General Con-tractor’s instructions.
2.3 Communications --- Unless otherwise specifically provided in the Contract Documents, Subcontrac-tor shall communicate with the Client only through General Contractor and shall take directions and orders regarding the performance of this Subcontract only from General Contractor’s authorized representatives.
2.4 Submittals --- Subcontractor shall submit for approval to General Contractor all design documents, reports, professional certifications, shop drawings, samples, product data, manufacturers’ literature and similar submittals required by the Contract Documents in such a manner so as to permit adequate time for review of the submittals without delay to the Project schedule. Subcontractor shall be solely responsible for the accuracy of submittals and conformity of same to the Contract Documents, irrespective of any Project participant’s approval of the same.
2.5 Subcontractor’s Representative --- The Subcontractor shall designate a person, subject to General Contractor’s approval, who shall be Subcontractor’s authorized representative. This representative shall have full authority to bind Subcontractor. Subcontractor’s representative shall not be changed without General Contractor’s advance written approval.
2.6 Compliance With Laws --- The Subcontractor agrees to be bound by, and at its own costs comply with all federal, state and local laws, ordinances and regulations (the “Laws”) applicable to Subcontractor’s Work. The Subcontractor shall indemnify, defend and hold General Contractor and Client harmless from and against all loss, cost and expense attributable to any acts of commission or omission by Subcontractor, its employees and agents resulting from the failure to comply therewith.
2.7 Confidentiality --- It is the intent of this Subcontract that all information about the Project be kept confidential by Subcontractor until made public by the General Contractor or Client, or due to public filings. Subcontractor shall hold in strictest confidence any information it receives from Client, General Contractor or any design consultants related to the designs, marketing concepts or other proprietary information for the Project. Subcontractor shall treat as proprietary and all such design information as well as the designs developed by Subcontractor and it's consultants whether or not designated as "Confidential". This shall include all drawings, reports, studies, design concepts, renderings, models and other similar design documents, in any form or media. Subcontractor shall not publish or disclose proprietary or confidential information for any purpose other than the performance of Subcontractor’s Work without the prior written authorization of Contractor. The preceding restrictions shall not apply to information which is in the public domain, was previ-ously known to Subcontractor, or is required to be disclosed by applicable Laws.
2.8 Royalties, Patents And Copyrights --- The Subcontractor shall pay all royalties and license fees which may be due on the inclusion of any patented or copyrighted materials, methods or systems selected by Subcontractor and incorporated in Subcontractor’s Work. The Subcontractor shall defend, indemnify and hold General Contractor and Client harmless from all suits or claims for infringement of any patent rights or copyrights arising out of such selection. The Subcontractor shall be liable for all loss, including all costs, expenses, and attorneys’ fees incurred as a result of Subcontractor’s failure to comply with this Section.
ARTICLE 3 - DELEGATED DESIGN SERVICES
This Article shall govern all “Delegated Design Services” to be provided by Subcontractor under this Subcontract.
3.1 Performance by Designer --- Subcontractor shall identify all persons providing architectural and/or engineering Delegated Design Services, all of which shall be duly qualified and licensed to perform such Subcontract Work in the place where the Project is located (“Designer” or “Designers”) and shall notify General Contractor in writing if it intends to change such Designer. Subcontractor shall bind every independ-ent Designer to the applicable terms and conditions of the Contract Documents. Subcontractor shall first obtain written acceptance from General Contractor for all proposed Designers and shall furnish to General Contractor copies of all executed agreements with Designers upon request, such acceptance may be withheld at General Contractor’s sole discretion. The Designer’s signature and seal shall appear on all drawings, calculations, specifications, certifications, shop drawings and other submittals prepared by the Designer.
3.2 Design Responsibility --- The Subcontractor shall be responsible for conformance of Delegated Design Services with the information given and the design concept expressed in the Contract Documents and all design and performance criteria applicable thereto. Subcontractor shall be fully responsible for all acts, errors or omissions of the Designer and of all Lower-Tier Providers directly or indirectly employed or engaged by Subcontractor for or in furtherance of the performance of Delegated Design Services and shall, without additional compensation, promptly correct or revise any errors or omissions in Subcontractor’s Work as determined by General Contractor.
3.3 Verification of Services by Others --- If Delegated Design Services require Subcontractor to use, or evaluate any information or services provided by General Contractor, Client or any other party, Subcon-tractor shall verify the technical accuracy of such items and shall immediately report in writing to General Contractor any conflict, error, deficiency or discrepancy discovered by such investigation and verification. Subcontractor shall assume all risks and bear all costs associated with any conflict, error, inaccuracy or discrepancy in such items which are not discovered by Subcontractor due to its failure to conduct the type of inquiry and study that a professionally licensed Designer is capable to perform using the best efforts consistent with the highest skills in the market, or which are discovered by Subcontractor but not immedi-ately reported in writing to General Contractor.
3.4 Ownership and Use of Design Documents --- Subcontractor acknowledges that the Contract Documents grants to Client certain rights of ownership, use, reuse, reproduction or other entitlements with respect to Subcontractor’s Work, including that provided by Subcontractor as Delegated Design Services, and Subcontractor unconditionally consents to any such terms and agrees to abide by same, without additional compensation. Subcontractor shall obtain the same acknowledgement and agreement from any Designer.
3.5 Indemnity for Delegated Design Services --- In addition to the indemnity provisions set forth in Article 8, Subcontractor agrees to indemnify and hold harmless the indemnitees named in such Article from and against all claims, damages, losses and expenses, including but not limited to attorney’s fees and expenses, which arise out of or are related to the Delegated Design Services provided by or through Subcontractor, regardless of any alleged or actual negligence of the indemnitees.
ARTICLE 4 – CONSTRUCTION SERVICES
4.1 Coordination --- General Contractor shall have complete control of the premises on which Subcontractor’s Work is to be performed and shall have the right to decide the time or order in which the various portions of Subcontractor’s Work and shall have the right to schedule and coordinate Subcontractor’s Work with the work of others. Subcontractor shall cooperate with, and shall not delay, impede or otherwise impair the work of others participating in the construction of the Project.
4.2 Tests And Inspections --- Subcontractor shall schedule all required tests, approvals and inspections of Subcontractor’s Work at appropriate times so as not to delay the progress of the Subcontractor’s Work or work of others and shall give proper written notice to all required parties of such tests, approvals and inspections. Subcontractor shall bear all expenses associated therewith as required by the Contract Docu-ments. Unless otherwise agreed, such tests, approvals and inspections shall be conducted by an independ-ent testing laboratory or entity approved by General Contractor. Required certificates of testing, approval or inspection shall, unless otherwise required by the Contract Documents, be secured by Subcontractor and promptly delivered to General Contractor.
4.3 Use of Site --- The Subcontractor shall limit use of the site to areas defined by General Contractor and to the construction limits for its Work and storage to allow for work of other contractors and third parties and shall assume full responsibility for the protection and safekeeping of materials, machinery and products provided under the Subcontract and stored on the site or elsewhere during fabrication, storage and shipping. Subcontractor shall, at no cost to General Contractor, move any stored products which interfere with operations of the General Contractor or other contractors or subcontractors as directed by General Contractor and obtain and pay for the use of additional storage or work areas needed for the Subcontrac-tor's operations.
4.4 Cleanup --- Subcontractor will, daily and upon completion of each portion or phase of Subcontrac-tor’s Work, clean up and haul off the premises, or to a place on the premises specifically designated by General Contractor, all debris occasioned by the Work done hereunder and will promptly remove all equipment, machinery, materials, temporary facilities when they are no longer required for Subcontractor’s Work. Any trash, debris, or liquid that poses a possible threat of fire or safety shall be removed from the premises immediately. If, after (24) hours’ notice (or sooner if a health or safety hazard exists) by General Contractor to Subcontractor, Subcontractor has not cleaned the Project site as outlined in this Paragraph, then General Contractor may proceed with such clean-up work at Subcontractor's cost and expense plus an administrative fee of 20%. Clean-up charges involving the work of multiple subcontractors may be appor-tioned among them by the General Contractor, and Subcontractor shall be responsible for its share of such costs as determined by General Contractor.
4.5 Safety ---
A. In addition to complying with all applicable safety Laws, Subcontractor shall, and Subcontractor shall require that all its Lower-Tier Providers to comply with General Contractor’s Safety Plan, a copy of which Subcontractor has received and reviewed. Subcontractor shall also implement its own safety plan that is consistent with General Contractor’s Safety Plan and applicable Laws.
B. The Subcontractor shall give prompt written notice to General Contractor of all accidents involving bodily injury requiring a physician’s care, all property damage e, and all failures and/or “near-miss” in-cidents that could have resulted in serious bodily injury, whether or not such an injury was sustained. A detailed written report of the incident shall be furnished promptly if requested by General Contractor.
C. Subcontractor shall indemnify, defend and hold the General Contractor and Client harmless from and against claims, fines or penalties assessed or imposed against General Contractor or Client as a result of Subcontractor’s or its Lower-Tier Providers failure to comply with applicable safety Laws.
4.6 Protection of Work --- The Subcontractor shall take necessary precautions to properly protect Subcontractor’s Work and the work of others from damage caused by Subcontractor’s operations both on the Project site and at any offsite locations where materials and equipment are stored. Should Subcontractor cause damage to the Work or property of the Client, General Contractor or others, Subcontractor shall promptly remedy such damage to the satisfaction of General Contractor and Client.
4.7 Permits, Fees, Licenses and Taxes --- The Subcontractor shall give timely notices to authorities pertaining to Subcontractor’s Work, and shall be responsible for all permits, fees, licenses, assessments, inspections, testing and taxes necessary to complete Subcontractor’s Work in accordance with the Contract Documents.
4.8 Material Safety Data (MSD) Sheets --- The Subcontractor shall submit to General Contractor all Material Safety Data Sheets required by law for materials or substances necessary for the performance of Subcon-tractor’s Work. MSD sheets obtained by General Contractor from other subcontractors or sources shall be made available to Subcontractor by General Contractor.
4.9 Warranties --- Subcontractor warrants to the Client and General Contractor that of Subcontractor’s Work shall be executed in strict conformance with the Contract Documents and free from defects in material and workmanship. Subcontractor further warrants to the Client and General Contractor that all materials, machinery and equipment furnished and incorporated pursuant to this Subcontract shall be new unless otherwise specified in the Contract Documents. All Work not conforming to these standards shall be consid-ered defective. During the Project and for a period of one (1) year after final acceptance of the entire Project by the Client, Subcontractor shall, at Subcontractor’s sole cost and expense, remedy any defects in Subcontractor’s Work and any damages caused thereby promptly upon notice from General Contractor. Said period for correction shall be extended for one (1) year from the date of completion of any remediation Work during this period. The Subcontractor agrees to indemnify, defend and hold Client, General Contractor and Architect harmless from any losses, costs or other damages or expenses (including attorneys' fees) resulting from any breach of the foregoing warranty. Nothing herein shall in any way limit the right of Client or General Contractor under applicable state statute of limitations for breach of contract, negligence or breach of any express, implied or statutory warranties. The provisions of this Paragraph shall survive the making and acceptance of final payment and/or termination of this Subcontract.
4.10 Uncovering of Subcontractor’s Work ---
A. If required in writing by General Contractor, Subcontractor must uncover and restore to its original condition at Subcontractor’s expense, any portion of Subcontractor’s Work which has been covered by Subcontractor in violation of the Contract Documents or contrary to a directive issued to Subcontractor by General Contractor.
B. The General Contractor may also direct Subcontractor to uncover portions of Subcontractor’s Work for inspection at any time. Except as provided in Section 4.10(A) above, the Subcontract Amount and Subcontract Time shall only be adjusted by change order for the cost and time of uncovering and restor-ing any Work which is uncovered for inspection and proves to be installed in accordance with the Con-tract Documents. If the Work is found not to be in full accordance, Subcontractor shall pay all costs as-sociated with uncovering and correcting the Work.
4.11 Correction of Work --- Prior to final completion and acceptance of the Work, Subcontractor shall, at its sole expense, promptly and properly repair, replace or otherwise correct any Work that is (i) rejected by Client, General Contractor or Architect, or (ii) known, observed or discovered at any time by Subcontractor, General Contractor, Client or Architect to be defective or failing to conform to the Contract Documents.
If Subcontractor’s correction or removal of Subcontractor’s Work destroys or damages any work of the Client, General Contractor or any separate contractors, Subcontractor shall be responsible for the cost of correcting such destroyed or damaged construction. Failure to strictly comply with the terms of this Section shall amount to a default under this Subcontract.
4.12 Materials Or Equipment Furnished By Others --- In the event the scope of Subcontractor’s Work includes installation of materials or equipment furnished by others, it shall be the responsibility of Subcon-tractor to exercise proper care in receiving, handling, storing, installing and maintaining such items, unless otherwise provided in the Contract Documents. The Subcontractor shall examine the items provided and immediately report to General Contractor in writing any items it may discover that do not conform to requirements of the Contract Documents. The Subcontractor shall not proceed to install such items without further instructions from General Contractor. Loss or damage due to a failure to comply with this Section shall be deducted from any amounts due or to become due Subcontractor.
4.13 Substitutions --- No substitutions shall be made in Subcontractor’s Work unless permitted in the Contract Documents and only upon Subcontractor first receiving written approval from General Contractor, Client and Architect.
4.14 Use Of General Contractor’s Equipment --- The Subcontractor and its Lower-Tier Providers shall use General Contractor’s equipment only with the express written permission of General Contractor’s designated representative and in accordance with General Contractor’s terms and conditions for such use. If Subcon-tractor or any of its Lower-Tier Providers utilize any of General Contractor’s equipment, including machin-ery, tools, scaffolding, hoists, lifts or similar items owned, leased or under the control of General Contractor, Subcontractor shall defend, indemnify and be liable to General Contractor as provided in Article 8.
4.15 Labor Relations ---
A. Subcontractor shall work in harmony with all other trades on the Project site to assure that no labor disputes of any kind involving its employees and/or Lower-Tier Providers occur or be manifested on the Project, and Subcontractor shall only employ persons on the Project who will work at all times in har-mony with other persons and trades employed on the Project.
B. Subcontractor shall be solely responsible for any delays and cost impacts incurred by General Con-tractor, Subcontractor or any other trades on the Project as a result of Subcontractor’s or its Lower-Tier Providers’ failure to comply with this Section 4.15.
4.16 Record Documents --- Subcontractor shall maintain in a safe place at the Project site one record copy of all drawings, specifications, addenda, written amendments, Change Orders, and Change Directives, in good order and annotated to show all changes made during construction. These record documents together with all approved submittals will be available to General Contractor for reference. Upon completion of the Subcontractor’s Work, these record documents and submittals will be delivered to General Contractor.
ARTICLE 5 – SUBCONTRACT TIME
5.1 Time of the Essence --- Time is of the essence for the performance of all aspects of Subcontractor’s Work, and Subcontractor shall complete the Work within the Subcontract Time, as may be modified pursu-ant to the terms of this Subcontract, including all applicable milestone dates.
5.2 Subsequent Determinations --- To the extent that all material dates, milestones and other time constraints pertaining to Subcontractor’s Work have not been fully ascertained or determined as of the date of this Subcontract, then upon General Contractor’s determination of same, such dates, milestones and other time constraints shall become a binding condition of this Subcontract. General Contractor may also revise and update any schedule applicable to Subcontractor’s Work to account for actual progress and performance of work for the entire Project, without any increase in the Subcontract Time or Subcontract Price.
5.3 Delays and Extensions of Time ---
A. It is contemplated that Subcontractor's performance under this Subcontract may be delayed, accel-erated suspended, hindered or disrupted (a) by acts or omissions of the Client , General Contractor, Architect, other subcontractors or other parties involved with the Project, or (b) by other circumstances not caused by or within the control of Subcontractor. In such cases, Subcontractor may request an ex-tension of time for performance and completion of the Subcontractor’s Work. The extension of time to which Subcontractor may be entitled under this Paragraph shall under no circumstances exceed any ex-tension of time granted to General Contractor. Furthermore, such time extension shall be Subcontrac-tor's sole and exclusive remedy in respect of its Work being delayed, accelerated suspended, hindered or disrupted. Accordingly, and notwithstanding any other provision herein or in any other Subcontract Documents, Subcontractor shall not be entitled to recover any damages, costs or other form of compen-sation of any type whatsoever as a consequence thereof, notwithstanding the nature of the circum-stances giving rise thereto or the extent or duration thereof, any and all such circumstances and conse-quences being within the contemplation of the parties.
B. Subject to the terms of the Contract Documents, if the commencement and/or progress of Subcon-tractor’s Work is delayed by causes beyond Subcontractor’s control and without the fault or responsibil-ity of Subcontractor, Subcontractor must submit a written request for an extension of the Subcontract Time in accordance with Article 6.5. Failure to strictly comply with the preceding obligations shall result in a waiver of Subcontractor’s right to a claim for an extension of the Subcontract Time.
5.4 Delay Damages --- If the Contract Documents provide for the assessment of liquidated or other damages for unexcused performance or completion delays by General Contractor and such damages are assessed, General Contractor may assess and recover a share of such damages against Subcontractor in proportion to Subcontractor’s and its Lower-Tier Providers’ share of the responsibility for the delay. This Paragraph shall not limit General Contractor’s right to claim, recover and assess separate actual damages to compensate General Contractor for damages sustained independently by General Contractor as a result of any unexcused delay in performance and completion of Subcontractor’s Work.
5.5 Directed Acceleration --- General Contractor may, at any time, schedule and direct Subcontractor to perform Subcontractor’s Work using additional crews or shifts, or on an overtime basis. If , in General Contractor’s opinion, such direction is not required due to Subcontractor's acts, omissions, delays or other breach of this Subcontract in whole or in part, General Contractor may pay the cost of such supplemental labor, without overhead or profit, and Subcontractor agrees to accept such portion in complete settlement of any and all claims for damages, loss, cost or expense caused by or in any way related to such supplemental labor, including, but not limited to, costs for owned or rented machinery or equipment. Otherwise, such supplemental labor shall be Subcontractor’s sole cost and expense. As a condition to its right to payment under this Paragraph, Subcontractor shall keep and present a satisfactory and verifiable accounting of compensable labor costs, with appropriate supporting documentation as required by General Contractor.
ARTICLE 6 - CHANGES AND CLAIMS
6.1 Right to Order Changes --- The scope of Subcontractor’s Work may at any time be modified in any respect by changes, additions or deletions directed by or on behalf of Client or General Contractor, and the Subcontract Amount and Subcontract Time affected thereby may be adjusted accordingly, by written “Change Order” executed by General Contractor and Subcontractor or written “Change Directive” executed unilaterally by General Contractor.
6.2 Change Proposal --- The General Contractor may provide Subcontractor with a description of any change or Change Directive in the form of drawings or otherwise. In such case, the Subcontractor shall submit to General Contractor a proposal for any adjustments in the Subcontract Amount and/or Subcontract Time for completion resulting therefrom, which must include all documentation necessary to substantiate the proposal: (i) within five (5) days after the first occurrence of the event giving rise to such potential change, or (ii) at least five (5) days before the date when General Contractor is required by the terms of the Contract Documents to provide the same or similar notice to Client, whichever occurs first. Failure to strictly comply with these submission requirements shall result in a waiver of Subcontractor’s right to any increase in the Subcontract Amount or extension of the Subcontract Time related to such change. If the General Contractor issues a Change Directive for Subcontractor to commence performance of all or any portion of a change without a mutually signed Change Order, the Subcontractor shall promptly proceed with the change as directed. The amount to paid for such Change Directive shall not exceed the actual cost of materials and labor time spent, confirming the performance of the Work only, which must be presented to General Contractor’s onsite representative daily for signature. Material expenses, of which receipts must be submit-ted with each request for payment, are to be materials purchased plus a maximum (5%) overhead and (5%) profit.
6.3 Minor Changes --- The General Contractor will have authority to order minor changes in the Subcontractor’s Work not involving an adjustment in the Subcontract Amount or Subcontract Time and not inconsistent with the intent of the Subcontract Documents. Such changes shall be effected by written directive and shall be binding on the Subcontractor. The Subcontractor shall carry out such written order promptly and in the manner directed.
6.4 Change Order or Change Directive Required --- No alterations, increases or decreases shall be made in the Subcontractor’s Work except as specifically authorized pursuant to an executed Change Order or Change Directive executed by a duly authorized representative of General Contractor. Subcontractor shall have no claim for additional, extra or changed work unless such Work is undertaken pursuant to such Change Order or Change Directive .
6.5 Notice of Claims --- In all circumstances whereby Subcontractor desires to make a claim for an increase in the Subcontract Amount and/or extension of the Subcontract Time, Subcontractor shall, as a condition precedent to such right of claim and recovery, give General Contractor written notice thereof, which must include all documentation necessary to substantiate the claim: (i) within five (5) days after the first occurrence of the event giving rise to such claim, or (ii) at least five (5) days before the date when General Contractor is required by the terms of the Contract Documents to provide the same or similar notice to Client, whichever occurs first. In no event shall Subcontractor be entitled to any monetary claim or request for extension of time in connection with any individual or cumulative changes, matters, circumstanc-es or conditions that have previously been addressed by a Change Order or other amendment to this Subcontract executed between the parties. Under no circumstances shall any failure or delay in giving such notice be excused, and no reservation of rights to make or submit a claim at a later date shall be effective to preserve the claim if not timely, justified by causes beyond Subcontractor’s control and properly made in accordance with this Paragraph. The provisions of this Paragraph shall not be deemed to establish or enhance any rights and/or remedies otherwise excluded by other provisions of this Subcontract or the Contract Documents.
6.6 Compensable Costs --- In determining the sums payable to Subcontractor for changes, costs for reasonable utilization and expenditure of labor, machinery, fuel and materials shall be determined based on amounts actually paid or by prevailing rates in the Project area, whichever is less. In no case shall payment include an allowance for profit and overhead in excess of ten percent (10%).
6.7 Differing Site Conditions --- If in the performance of Subcontractor’s Work Subcontractor encounters latent, concealed or subsurface physical conditions which differ materially from those indicated in the Subcontract Documents or unknown physical conditions of an unusual nature which differ materially from those ordinarily found to exist, and not generally recognized as inherent in the kind of Work provided for in this Subcontract, the Subcontract Amount and/or the Subcontract Time may be equitably adjusted provided: (i) Subcontractor timely submits a claim in accordance with the Subcontract and (ii) any such adjustment(s) shall be limited to the adjustment(s) General Contractor receives from Client on behalf of Subcontractor.
ARTICLE 7 - PAYMENT
7.1 Schedule of Values --- Subcontractor shall submit to General Contractor a schedule of values which allocates the Subcontract Amount among the various parts of the Subcontractor’s Work, which submission, together with approval thereof by General Contractor, shall be a condition precedent to Subcontractor’s right to apply for or receive any payments hereunder. The schedule of values shall be in such form and contain such detail and categories for Subcontractor’s Work as General Contractor may prescribe. It shall be used as a basis for Subcontractor’s applications for payments, unless found by General Contractor to be in error.
7.2 Time and Amount of Payments --- Except as otherwise provided herein, and provided Subcontractor is not in default hereunder, progress payments for Work properly performed will be made to Subcontractor within ten (10) days after receipt of payment from Client. The amount of an interim or final payment to Subcontractor shall not exceed the value of labor and materials incorporated by Subcontractor in the Subcontractor’s Work as of the date of the application for payment, less retainage thereon to be withheld therefrom in such percentages and upon such other terms as may be provided in Exhibit C, and less the aggregate of previous pay applications. Furthermore, the amount of a progress payment shall not exceed the percentage of completion allowed or approved by Client and General Contractor for the Subcontractor’s Work, less the specified retainage. To the extent permitted under state law, Subcontractor acknowledges and agrees that payment to General Contractor by Client is an absolute condition precedent to payment to Subcontractor, and, in addition to the other conditions precedent to payment in this Subcontract, no amounts shall be due and owing to Subcontractor until General Contractor has received payment from Client for those same amounts. If such a provision is not permitted under state law, then it shall be construed as a mecha-nism for the timing of payment.
7.3 Applications for Payment --- Subcontractor’s applications for payments shall be submitted in strict conformity with the Billing Requirements stated in Exhibit C or as otherwise prescribed by General Contrac-tor or Client during the course of the Project. Each application shall be accompanied by breakdown data and other documentation as requested to permit checking and verification of amounts properly payable to Subcontractor on account of Subcontractor’s Work. General Contractor shall be entitled to back charge Subcontractor for clerical accounting service necessary to conform Subcontractor’s invoice to the requirements of the Contract Documents at General Contractor’s cost per hour plus 20%.
7.4 Payment for Stored Materials --- If the Contract Documents permit payment for materials, machin-ery or equipment not incorporated into Subcontractor’s Work, but delivered and suitably stored on or off the site of the Project, Subcontractor shall, as a condition to its right to receive any such payment, provide all certificates, documents of title, insurance coverages and other items requested by General Contractor to establish, ensure and protect General Contractor's and Client’s title and right of possession and access to any such materials for which payment is being sought.
7.5 Payment to Lower-Tier Providers --- Subcontractor shall at all times be solely responsible to pay for all materials, machinery, equipment and labor used in, or in connection with, the performance of this Subcontract, and no interim or final payments shall become due until Subcontractor has furnished affidavits, waivers, releases, certificates, or other evidence satisfactory to General Contractor to establish that Subcontractor has paid for or discharged all actual or prospective claims or liens arising out of or relating to Subcontractor’s Work. General Contractor shall have the right to contact any Lower-Tier Providers to ascertain from them whether they are being paid by Subcontractor in accordance with this Subcontract.
7.6 Withholding of Funds --- Payments otherwise due to Subcontractor may be withheld by General Contractor upon General Contractor’s reasonable belief in the existence of
A. Uncorrected defective or non-conforming Work;
B. Claims or liens filed by Lower-Tier Providers;
C. Subcontractor's failure or neglect to make payments properly due to its Lower-Tier Providers;
D. Subcontractor’s Work not being capable of being completed for the balance of the Subcontract Amount then unpaid;
E. Any other material breach of this Subcontract; or
F. Any other conditions specified elsewhere in the Contract Documents as grounds for withholding of payment.
General Contractor may, upon written notice, rectify the foregoing at Subcontractor's expense and may make direct disbursement to unpaid claimants from payments due or to become due under this Subcontract or any other agreement between General Contractor and Subcontractor (“Other Agreements”).
7.7 Payment Not a Release --- No payment to Subcontractor shall operate as an approval of Subcon-tractor’s Work, or any part thereof, or as a release of Subcontractor from any of its obligations under the Contract Documents.
7.8 Final Payment Requirements --- Final payment of the unpaid balance of the Subcontract Amount shall be paid to Subcontractor within ten (10) days of receipt of final payment from Client, provided that the following requirements have first been satisfied:
A. Subcontractor’s Work is fully completed and performed in accordance with the Contract Documents and is satisfactory to and approved by Client and General Contractor;
B. Subcontractor has delivered all manuals, record drawings, guarantees, and warranties for material, machinery and equipment furnished by Subcontractor, and testing and/or inspection results or reports applicable to Subcontractor’s Work;
C. Subcontractor has delivered to General Contractor satisfactory evidence that all labor and material accounts incurred by Subcontractor in connection with the Subcontractor’s Work have been paid in full;
D. Other submittals have been provided as prescribed elsewhere in this Article;
E. Subcontractor has fulfilled all other requirements established by the Contract Documents to serve as conditions for final payment; and
F. General Contractor has received full and final payment from Client for the Subcontractor’s Work, which receipt of payment shall be a condition precedent to General Contractor's obligation to make final payment to Subcontractor.
7.8 To the extent permitted under state law, Subcontractor acknowledges and agrees that final payment to General Contractor by Client is an absolute condition precedent to payment to Subcontractor, and, in addition to the other conditions precedent to payment in this Subcontract, no amounts shall be due and owing to Subcontractor until General Contractor has received payment from Client for those same amounts. If such a provision is not permitted under state law, then this paragraph shall be construed as a mechanism for the timing of payment.
7.9 Effect of Final Payment --- The disbursement and acceptance of any sum tendered as final payment to Subcontractor shall constitute a waiver of any and all claims by the Subcontractor, excepting those claims previously made in writing and specifically identified as unresolved in the Subcontractor’s application for final payment.
7.10 Liens and General Contractor Bonds --- Subcontractor shall indemnify, defend and hold harmless General Contractor, its surety and Client from any lien filed or claim made by any third party asserting nonpayment for labor, materials, or services furnished or performed as a part of the Work or otherwise on behalf of Subcontractor or a Lower-Tier Provider. Subcontractor shall promptly remove any such lien, claim or suit by bonding over, payment, acceptance of tender of defense or otherwise within ten (10) days of written notice from General Contractor. If Subcontractor fails to remove any lien or claim against Client, General Contractor may, in addition to all other remedies retain sufficient funds out of any money due or thereafter to become due by General Contractor to Subcontractor under this Subcontract or Other Agreements to resolve the same and pay all additional costs incurred by reason thereof, including attorney’s fees.
ARTICLE 8 - INDEMNITY AND INSURANCE
8.1 Indemnity --- To the fullest extent permitted by law, Subcontractor shall indemnify, hold harmless and defend General Contractor, Client and all of their officers, directors, agents, employees and consultants, from and against all claims, damages, fines, penalties, losses and expenses, including actual attorney's fees, arising out of or resulting from (i) the performance of Subcontractor's Work, (ii) acts and/or omissions of Subcontractor or Lower-Tier Providers, (iii) any errors or omissions in any documents prepared by or on behalf of Subcontractor for the Project, (iv) infringement of any patent rights or copyrights or (v) the use of any products, materials, machinery or equipment furnished by Subcontractor. The foregoing obligations shall apply regardless of whether it is caused in part by any negligent act or omission of a party indemnified hereunder.
A. This indemnity shall survive the completion or termination of this Subcontract and shall be in addition to any other rights which General Contractor and Client would otherwise have at law or in equity. The parties indemnified hereunder may, at their sole option, either defend themselves and seek indemnity from Subcontractor, or require that Subcontractor pay and provide for their defense and indemnity.
B. Subcontractor’s obligations under this Paragraph shall not be limited in any way by any limitation on the amount or type of damages, compensation or benefits payable by or for Subcontractor under work-er's compensation acts, disability benefit acts or other employee benefit acts.
8.2 Insurance – Until final completion of Subcontractor’s Work, or later if required by the Contract Documents, Subcontractor shall maintain and pay for insurance coverage with respect to Subcontractor’s Work of the types, with the limits and in compliance with the terms as set forth in Exhibit B. Such coverage shall be maintained in form and with companies acceptable to General Contractor and shall, notwithstanding Exhibit B, meet the applicable requirements imposed under the Contract Documents or by any governmental authority having jurisdiction over the Work. All insurance policies shall contain a provision that such cover-ages and limits afforded thereunder shall not be canceled, materially changed, non-renewed or restricted without thirty (30) days prior written notice to General Contractor. General Contractor and Client shall be named as additional insureds under all policies of insurance set forth in Exhibit B.
8.3 Bonds ---
A. If performance and/or payment bonds are required under the Contract Documents, Subcontractor shall furnish, within ten (10) days of the date of the Subcontract such bonds in a form and by a surety satisfactory to General Contractor and in a penal sum equal to the Subcontract Amount, unless other-wise specified. The penal sum of the payment and/or performance Bonds shall automatically increase or decrease by the amount of the price of each Change Order without notice to or consent of Subcontrac-tor’s surety. The bond premium adjustment for each Change Order shall be included in the price of each Change Order.
B. If bonds are not specifically required under the Contract Documents, General Contractor may, by written notice to Subcontractor at any time before final completion and acceptance of Subcontractor's Work, require Subcontractor to provide the performance and/or payment bonds in such penal sums as General Contractor may determine. If Subcontractor is not then in default under this Subcontract, the premium costs for such bonds, excluding overhead and profit, will be added to the Subcontract Amount by Change Order; otherwise, such costs shall be paid by Subcontractor without increase in the Subcon-tract Amount.
ARTICLE 9 - DEFAULT, TERMINATION AND SUSPENSION
9.1 Right to Terminate --- General Contractor shall have the right at any time, upon 24 hours prior written notice to Subcontractor, to terminate this Subcontract in whole or in part and require Subcontractor to cease work thereunder; such termination shall be rightful as against Subcontractor whether undertaken because of Subcontractor's default or for the convenience of the Client or General Contractor.
A. If termination is for Subcontractor’s default, the respective rights and obligations of the parties shall be as provided in Paragraph 9.2 below.
B. If termination is for the convenience of General Contractor or Client, or if the Subcontract is termi-nated upon General Contractor's belief that Subcontractor is in default but it is subsequently determined pursuant to Article 10 that Subcontractor was not then in default, in which case such termination be-comes a termination for convenience, the rights and obligations of the parties shall be as provided in Paragraph 9.3 below.
9.2 Default ---
A. Subcontractor shall be deemed in default under this Subcontract upon the occurrence of any of the following conditions (“Condition(s) of Default”):
1. Refusal or neglect to supply adequate and competent supervision or a sufficiency of properly skilled workmen or materials of the proper quality or quantity to accomplish and complete Sub-contractor’s Work in accordance with the Contract Documents, including applicable schedules;
2. Failure in any respect to prosecute the Work with promptness and diligence or otherwise in ac-cordance with the Contract Documents;
3. Causing or contributing to delay, or damage to the work of General Contractor Client, other subcontractors, suppliers or other parties;
4. Failing in any respect to make prompt and proper payments to its workers, the Designer, or other Lower-Tier Providers engaged by Subcontractor to perform or provide any portion of the Subcontractor’s Work;
5. Subcontractor files a petition under the Bankruptcy Code or other insolvency procedure; or
6. Failing to perform or fulfill any duties or responsibilities set forth in the Contract Documents , whether or not specifically listed above.
B. If Subcontractor fails to commence and continue satisfactory correction of any Condition of Default, pursuant to an approved written plan of correction, with diligence and promptness after written notice thereof is given to Subcontractor by General Contractor, then General Contractor without prejudice to any other rights or remedies shall have the right to any or all of the remedies set forth in Clauses C and/or D below.
C. General Contractor may:
1. Supply workers, materials, equipment and facilities as General Contractor deems necessary for the completion and/or correction of Subcontractor’s Work or any part which Subcontractor has failed to complete, correct or perform, and charge the cost, including attorneys’ fees, costs and expenses, plus an allowance of 20% for overhead and profit, to Subcontractor;
2. Contract with one or more additional contractors or subcontractors to perform any such part of Subcontractor’s Work as General Contractor determines will provide the most expeditious com-pletion and/or correction thereof, and charge the cost plus an allowance of 20% overhead and profit, to Subcontractor;
3. Withhold any payments due or to become due Subcontractor under this Subcontract or Other Agreements in amounts determined by General Contractor to be sufficient to cover all costs and damages incurred or to be incurred by General Contractor for or incidental to performing, com-pleting and/or correcting Subcontractor’s Work, including attorneys’ fees, costs and expenses, plus a 20% allowance for overhead and profit. The Subcontractor shall be liable for the pay-ment of any amount by which such expense may exceed the unpaid balance of the Subcontract Amount; and
4. Take any other action General Contractor deems necessary to remedy Subcontractor’s Condi-tions of Default.
In the event of an emergency affecting the safety of persons or property, General Contractor may pro-ceed as above without notice, but General Contractor shall give Subcontractor notice as soon as practi-cable.
D. In lieu of or in addition to the remedy set forth in Clause C above, General Contractor may termi-nate this Subcontract and Subcontractor’s right to proceed hereunder upon giving a written notice of termination to Subcontractor. In such case:
1. General Contractor may take any action General Contractor deems necessary to remedy the Conditions of Default and finish the Work, including, but not limited to, furnish materials, equip-ment and/or employ such workers or subcontractors as General Contractor deems necessary to maintain the orderly progress, completion and/or correction of the Subcontractor’s Work; and
2. All costs and damages incurred by General Contractor for or incidental to remedying the Condi-tions of Default and performing, completing and/or correcting Subcontractor’s Work, including attorneys’ fees, costs and expenses, plus a 20% allowance for overhead and profit, shall be de-ducted from any moneys due or to become due Subcontractor under this Subcontract or Other Agreements.The Subcontractor shall be liable for the immediate payment of any amount by which such expense may exceed the unpaid balance otherwise owed to Subcontractor.
E. Upon General Contractor exercising of any remedies provided under this Section 9.2, Subcontractor shall not be entitled to receive any payment under this Subcontract or Other Agreements which might otherwise be due it until the General Contractor’s completion and corrective actions hereunder are com-pleted and all direct and indirect costs and charges against Subcontractor have been ascertained.
F. In the exercise of any remedies under this Section, General Contractor or other subcontractors shall have the right, but not the duty, to take and use any materials, implements, equipment, appliances or tools furnished by, or belonging to Subcontractor and located at the Project site for the purpose of per-forming, completing and/or correcting Subcontractor’s Work.
G. A determination of default made by General Contractor in good faith under the belief that a Condi-tion of Default exists shall be conclusive on the fact of such default and on General Contractor's right to proceed as provided in this Paragraph.
9.3 Termination for Convenience --- If this Subcontract is terminated for the convenience of General Contractor, Subcontractor shall immediately stop Work and take all steps directed by General Contractor to facilitate completion of the Work by others. General Contractor’s obligation for payment to Subcontractor shall be limited to the unpaid Subcontract Amount for authorized and approved Work performed by Subcon-tractor prior to receiving the notice of termination. Recovery by Subcontractor of lost anticipated profit, overhead, or other direct, indirect or consequential damages relating to portions of Subcontractor’s Work not performed under the Subcontract are hereby specifically excluded. The payment provided by this Paragraph shall constitute Subcontractor's exclusive remedy in the event of such termination.
9.4 Suspension --- General Contractor may, without cause, order the Subcontractor in writing to suspend, delay or interrupt the Subcontractor’s Work in whole or in part for such period of time as the Contractor may determine. The Subcontract Amount and Subcontract Time may be adjusted for increases in the cost and time caused by suspension, delay or interruption as is equitably required. Adjustment of the Subcontract Amount shall not include increased profit. No adjustment shall be made to the extent:
1. that performance is, was or would have been so suspended, delayed or interrupted by an-other cause for which the Subcontractor is responsible; or
2. that an equitable adjustment is made or denied under another provision of the Contract Documents.
ARTICLE 10 - DISPUTE RESOLUTION
10.1 Effect of Client-General Contractor Dispute Resolution --- The resolution of any dispute between Client and General Contractor which involves a claim made by or against Subcontractor shall become binding upon Subcontractor provided that Subcontractor has been given a reasonable opportunity to join, participate, assist or provide supporting evidence in the presentation of any claim, defense or other issue in controversy that is settled or resolved thereby.
10.2 General Contractor- Subcontractor Dispute Resolution --- Any dispute between General Contractor and Subcontractor shall be decided, at the sole option of General Contractor, by litigation in a court of competent jurisdiction or arbitration in accordance with the latest version of the American Arbitration Association rules for Construction Industry proceedings. General Contractor may elect between arbitration or court after the dispute arises. Written notice of a demand for arbitration shall be delivered to the Ameri-can Arbitration Association and the other party in accordance with time limits in the Subcontract and within the time for institution of legal proceedings according to applicable statutes of limitations.
10.3 Forum Selection --- To the extent permitted by law, any litigation or arbitration to resolve any dispute arising out of or relating to this Agreement shall occur in Milwaukee, Wisconsin.
10.4 Attorney’s Fees --- In the event either General Contractor or Subcontractor institutes suit in court or arbitration against the other party, or against the surety of such party, in connection with any dispute or matter arising under this Subcontract, and if General Contractor prevails in the suit, General Contractor shall be entitled to recover from the Subcontractor its actual attorneys’ fees, expert fees and related costs or award, which shall be determined by the court or arbitrator(s) and included in the judgment in said suit or proceeding. For purposes of enforcing this Section, “prevails” shall mean that Contractor receives any type of compensation, consideration or equitable remedy or Subcontractor fails to receive more than 90% of its claim.
10.5 Duty to Perform --- Subcontractor shall continue to perform Subcontractor’s Work and all other contractual obligations arising hereunder during any dispute and pending full and final resolution thereof in any dispute resolution proceeding. If Subcontractor continues to perform, the General Contractor shall continue to make payments to Subcontractor subject to the terms, conditions and limitations otherwise set forth in the Contract Documents.
ARTICLE 11 - MISCELLANEOUS PROVISIONS
11.1 Governing Law --- This Agreement shall be governed by the law in effect at the location of the Project.
11.2 Severability --- The partial or complete invalidity of any one or more provisions of this Subcontract shall not affect the validity or continuing force and effect of any other provision.
11.3 No Waiver Of Performance - The failure of either party to insist, in any one or more instances, upon the performance of any of the terms, covenants or conditions of this Subcontract, or to exercise any of its rights, shall not be construed as a waiver or relinquishment of term, covenant, condition or right with respect to further performance.
11.4 Joint Drafting --- The parties expressly agree that this Subcontract was jointly drafted, and that they both had opportunity to negotiate its terms and to obtain the assistance of counsel in reviewing its terms prior to execution. Therefore, this Subcontract shall be construed neither against nor in favor of either party, but shall be construed in a neutral manner.
11.5 Successors and Assignment --- Subcontractor hereby binds itself, its partners, successors, assigns, subsidiaries, parent companies, affiliates and legal representatives to all of the obligations applicable to Subcontractor under the Contract Documents. Subcontractor shall not assign the Subcontract, in whole or in part, without the prior written consent of General Contractor, and Subcontractor shall remain fully liable under the Subcontract if Subcontractor fails to comply with this Section 11.6. General Contractor may assign all or any portion of this Subcontract.
11.6 Waiver Of Consequential Damages --- Subcontractor waives claims against General Contractor for consequential damages arising out of or relating to this Subcontract, including, but not limited to, damages for principal office expenses and the compensation of personnel stationed there; loss of financing, business and reputation; and for loss of profit. Similarly, Subcontractor shall obtain from its Lower-Tier Providers waivers of consequential damages that correspond to Subcontractor’s waiver of consequential damages herein.
11.7 Extent of Agreement --- Except as otherwise specifically provided in the Contract Documents, nothing in this Subcontract shall be construed to create a contractual relationship between persons or entities other than General Contractor and Subcontractor. This Subcontract represents the entire and integrated agreement between the parties, and supersedes all prior negotiations, representations, or agreements, either written or oral.