Document:

EX-10.2

Exhibit 10.2

AIA Document A201 — 1997

General Conditions of the Contract for Construction

 for the following PROJECT:

(Name and location or address):

Skechers Office Building

330 South Sepulveda Blvd.

Manhattan Beach, CA 90266

THE OWNER:

(Name and address):

Duncan Investments, LLC

225 South Sepulveda Blvd.

Manhattan Beach, CA 90266

THE ARCHITECT:

(Name and address):

David Forbes Hibbert AIA

1544 20th Street, Suite 103

Santa Monica, CA 90404

	 	 	 	TABLE OF ARTICLES

	 	 	 
	1	 	GENERAL PROVISIONS
	2

	 	OWNER
	 
	 	 
	3

	 	CONTRACTOR

	 	4	 	ADMINISTRATION OF THE CONTRACT

	 	5	 	SUBCONTRACTORS

	 	6	 	CONSTRUCTION BY OWNER OR BY SEPARATE CONTRACTORS

	 	 	 
	7	 	CHANGES IN THE WORK
	8

	 	TIME
	 
	 	 
	9

	 	PAYMENTS AND COMPLETION
	 
	 	 

1

	 	10	 	PROTECTION OF PERSONS AND PROPERTY

	 	11	 	INSURANCE AND BONDS

	 	12	 	UNCOVERING AND CORRECTION OF WORK

	 	13	 	MISCELLANEOUS PROVISIONS

	 	14	 	TERMINATION OR SUSPENSION OF THE CONTRACT

2

INDEX

(Numbers and Topics in Bold are Section Headings)

Acceptance of Nonconforming Work

9.6.6, 9.9.3, 12.3

Acceptance of Work

9.6.6, 9.8.2, 9.9.3, 9.10.1, 9.10.3, 12.3

Access to Work

3.16, 6.2.1, 12.1

Accident Prevention

4.2.3, 10

Acts and Omissions

3.2, 3.3.2, 3.12.8, 3.18, 4.2.3, 4.3.8, 4.4.1, 8.3.1, 9.5.1, 10.2.5, 13.4.2, 13.7, 14.1

Addenda

1.1.1, 3.11

Additional Costs, Claims for

4.3.4, 4.3.5, 4.3.6, 6.1.1, 10.3

Additional Inspections and Testing

9.8.3, 12.2.1, 13.5

Additional Time, Claims for

4.3.4, 4.3.7, 8.3.2

ADMINISTRATION OF THE CONTRACT

3.1.3, 4, 9.4, 9.5

Advertisement or Invitation to Bid

1.1.1

Aesthetic Effect

4.2.13, 4.5.1

Allowances

3.8

All-risk Insurance

11.4.1.1

Applications for Payment

4.2.5, 7.3.8, 9.2, 9.3, 9.4, 9.5.1, 9.6.3, 9.7.1, 9.8.5, 9.10, 11.1.3, 14.2.4, 14.4.3

Approvals

2.4, 3.1.3, 3.5, 3.10.2, 3.12, 4.2.7, 9.3.2, 13.4.2, 13.5

Arbitration

4.3.3, 4.4, 4.5.1, 4.5.2, 4.6, 8.3.1, 9.7.1, 11.4.9, 11.4.10

Architect

4.1

Architect, Definition of

4.1.1

Architect, Extent of Authority

2.4, 3.12.7, 4.2, 4.3.6, 4.4, 5.2, 6.3, 7.1.2, 7.3.6, 7.4, 9.2, 9.3.1, 9.4, 9.5, 9.8.3, 9.10.1,
9.10.3, 12.1, 12.2.1, 13.5.1, 13.5.2, 14.2.2, 14.2.4

Architect, Limitations of Authority and Responsibility

2.1.1, 3.3.3, 3.12.4, 3.12.8, 3.12.10, 4.1.2, 4.2.1, 4.2.2, 4.2.3, 4.2.6, 4.2.7, 4.2.10, 4.2.12,
4.2.13, 4.4, 5.2.1, 7.4, 9.4.2, 9.6.4, 9.6.6

Architect’s Additional Services and Expenses

2.4, 11.4.1.1, 12.2.1, 13.5.2, 13.5.3, 14.2.4

Architect’s Administration of the Contract

3.1.3, 4.2, 4.3.4, 4.4, 9.4, 9.5

Architect’s Approvals

2.4, 3.1.3, 3.5.1, 3.10.2, 4.2.7

Architect’s Authority to Reject Work

3.5.1, 4.2.6, 12.1.2, 12.2.1

Architect’s Copyright

1.6

Architect’s Decisions

4.2.6, 4.2.7, 4.2.11, 4.2.12, 4.2.13, 4.3.4, 4.4.1, 4.4.5, 4.4.6, 4.5, 6.3, 7.3.6, 7.3.8, 8.1.3,
8.3.1, 9.2, 9.4, 9.5.1, 9.8.4, 9.9.1, 13.5.2, 14.2.2, 14.2.4

Architect’s Inspections

4.2.2, 4.2.9, 4.3.4, 9.4.2, 9.8.3, 9.9.2, 9.10.1, 13.5

Architect’s Instructions

3.2.3, 3.3.1, 4.2.6, 4.2.7, 4.2.8, 7.4.1, 12.1, 13.5.2

Architect’s Interpretations

4.2.11, 4.2.12, 4.3.6

Architect’s Project Representative

4.2.10

Architect’s Relationship with Contractor

1.1.2, 1.6, 3.1.3, 3.2.1, 3.2.2, 3.2.3, 3.3.1, 3.4.2, 3.5.1, 3.7.3, 3.10, 3.11, 3.12, 3.16, 3.18,
4.1.2, 4.1.3, 4.2, 4.3.4, 4.4.1, 4.4.7, 5.2, 6.2.2, 7, 8.3.1, 9.2, 9.3, 9.4, 9.5, 9.7, 9.8, 9.9,
10.2.6, 10.3, 11.3, 11.4.7, 12, 13.4.2, 13.5

Architect’s Relationship with Subcontractors

1.1.2, 4.2.3, 4.2.4, 4.2.6, 9.6.3, 9.6.4, 11.4.7

Architect’s Representations

9.4.2, 9.5.1, 9.10.1

Architect’s Site Visits

4.2.2, 4.2.5, 4.2.9, 4.3.4, 9.4.2, 9.5.1, 9.9.2, 9.10.1, 13.5

Asbestos

10.3.1

Attorneys’ Fees

3.18.1, 9.10.2, 10.3.3

Award of Separate Contracts

6.1.1, 6.1.2

Award of Subcontracts and Other Contracts for Portions of the Work

5.2

Basic Definitions

1.1

Bidding Requirements

1.1.1, 1.1.7, 5.2.1, 11.5.1

Boiler and Machinery Insurance

11.4.2

Bonds, Lien

9.10.2

Bonds, Performance, and Payment

7.3.6.4, 9.6.7, 9.10.3, 11.4.9, 11.5

Building Permit

3.7.1

Capitalization

1.3

Certificate of Substantial Completion

9.8.3, 9.8.4, 9.8.5

Certificates for Payment

4.2.5, 4.2.9, 9.3.3, 9.4, 9.5, 9.6.1, 9.6.6, 9.7.1, 9.10.1, 9.10.3, 13.7, 14.1.1.3, 14.2.4

Certificates of Inspection, Testing or Approval

13.5.4

Certificates of Insurance

9.10.2, 11.1.3

Change Orders

1.1.1, 2.4.1, 3.4.2, 3.8.2.3, 3.11.1, 3.12.8, 4.2.8, 4.3.4, 4.3.9, 5.2.3, 7.1, 7.2, 7.3, 8.3.1,
9.3.1.1, 9.10.3, 11.4.1.2, 11.4.4, 11.4.9, 12.1.2

Change Orders, Definition of

7.2.1

CHANGES IN THE WORK

3.11, 4.2.8, 7, 8.3.1, 9.3.1.1, 11.4.9

Claim, Definition of

4.3.1

Claims and Disputes

3.2.3, 4.3, 4.4, 4.5, 4.6, 6.1.1, 6.3, 7.3.8, 9.3.3, 9.10.4, 10.3.3

Claims and Timely Assertion of Claims

4.6.5

Claims for Additional Cost

3.2.3, 4.3.4, 4.3.5, 4.3.6, 6.1.1, 7.3.8, 10.3.2

Claims for Additional Time

3.2.3, 4.3.4, 4.3.7, 6.1.1, 8.3.2, 10.3.2

Claims for Concealed or Unknown Conditions

4.3.4

Claims for Damages

3.2.3, 3.18, 4.3.10, 6.1.1, 8.3.3, 9.5.1, 9.6.7, 10.3.3, 11.1.1, 11.4.5, 11.4.7, 14.1.3, 14.2.4

Claims Subject to Arbitration

4.4.1, 4.5.1, 4.6.1

Cleaning Up

3.15, 6.3

Commencement of Statutory Limitation Period

13.7

Commencement of the Work, Conditions Relating to

2.2.1, 3.2.1, 3.4.1, 3.7.1, 3.10.1, 3.12.6, 4.3.5, 5.2.1, 5.2.3, 6.2.2, 8.1.2, 8.2.2, 8.3.1, 11.1,
11.4.1, 11.4.6, 11.5.1

Commencement of the Work, Definition of

8.1.2

Communications Facilitating Contract Administration

3.9.1, 4.2.4

Completion, Conditions Relating to

1.6.1, 3.4.1, 3.11, 3.15, 4.2.2, 4.2.9, 8.2, 9.4.2, 9.8, 9.9.1, 9.10, 12.2, 13.7, 14.1.2

COMPLETION, PAYMENTS AND

9

Completion, Substantial

4.2.9, 8.1.1, 8.1.3, 8.2.3, 9.4.2, 9.8, 9.9.1, 9.10.3, 9.10.4.2, 12.2, 13.7

Compliance with Laws

1.6.1, 3.2.2, 3.6, 3.7, 3.12.10, 3.13, 4.1.1, 4.4.8, 4.6.4, 4.6.6, 9.6.4, 10.2.2, 11.1, 11.4, 13.1,
13.4, 13.5.1, 13.5.2, 13.6, 14.1.1, 14.2.1.3

Concealed or Unknown Conditions

4.3.4, 8.3.1, 10.3

Conditions of the Contract

1.1.1, 1.1.7, 6.1.1, 6.1.4

Consent, Written

1.6, 3.4.2, 3.12.8, 3.14.2, 4.1.2, 4.3.4, 4.6.4, 9.3.2, 9.8.5, 9.9.1, 9.10.2, 9.10.3, 11.4.1,
13.2, 13.4.2

CONSTRUCTION BY OWNER OR BY SEPARATE CONTRACTORS

1.1.4, 6

Construction Change Directive, Definition of

7.3.1

Construction Change Directives

1.1.1, 3.12.8, 4.2.8, 4.3.9, 7.1, 7.3, 9.3.1.1

Construction Schedules, Contractor’s

1.4.1.2, 3.10, 3.12.1, 3.12.2, 4.3.7.2, 6.1.3

Contingent Assignment of Subcontracts

5.4, 14.2.2.2

Continuing Contract Performance

4.3.3

Contract, Definition of

1.1.2

CONTRACT, TERMINATION OR SUSPENSION OF THE

5.4.1.1, 11.4.9, 14

Contract Administration

3.1.3, 4, 9.4, 9.5

Contract Award and Execution, Conditions Relating to

3.7.1, 3.10, 5.2, 6.1, 11.1.3, 11.4.6, 11.5.1

Contract Documents, The

1.1, 1.2

Contract Documents, Copies Furnished and Use of

1.6, 2.2.5, 5.3

Contract Documents, Definition of

1.1.1

Contract Sum

3.8, 4.3.4, 4.3.5, 4.4.5, 5.2.3, 7.2, 7.3, 7.4, 9.1, 9.4.2, 9.5.1.4, 9.6.7, 9.7, 10.3.2, 11.4.1,
14.2.4, 14.3.2

Contract Sum, Definition of

9.1

Contract Time

4.3.4, 4.3.7, 4.4.5, 5.2.3, 7.2.1.3, 7.3, 7.4, 8.1.1, 8.2, 8.3.1, 9.5.1, 9.7, 10.3.2, 12.1.1,
14.3.2

Contract Time, Definition of

8.1.1

CONTRACTOR

3

Contractor, Definition of

3.1, 6.1.2

Contractor’s Construction Schedules

1.4.1.2, 3.10, 3.12.1, 3.12.2, 4.3.7.2, 6.1.3

Contractor’s Employees

3.3.2, 3.4.3, 3.8.1, 3.9, 3.18.2, 4.2.3, 4.2.6, 10.2, 10.3, 11.1.1, 11.4.7, 14.1, 14.2.1.1,

Contractor’s Liability Insurance

11.1

Contractor’s Relationship with Separate Contractors and Owner’s Forces

3.12.5, 3.14.2, 4.2.4, 6, 11.4.7, 12.1.2, 12.2.4

Contractor’s Relationship with Subcontractors

1.2.2, 3.3.2, 3.18.1, 3.18.2, 5, 9.6.2, 9.6.7, 9.10.2, 11.4.1.2, 11.4.7, 11.4.8

Contractor’s Relationship with the Architect

1.1.2, 1.6, 3.1.3, 3.2.1, 3.2.2, 3.2.3, 3.3.1, 3.4.2, 3.5.1, 3.7.3, 3.10, 3.11, 3.12, 3.16, 3.18,
4.1.2, 4.1.3, 4.2, 4.3.4, 4.4.1, 4.4.7, 5.2, 6.2.2, 7, 8.3.1, 9.2, 9.3, 9.4, 9.5, 9.7, 9.8, 9.9,
10.2.6, 10.3, 11.3, 11.4.7, 12, 13.4.2, 13.5

Contractor’s Representations

1.5.2, 3.5.1, 3.12.6, 6.2.2, 8.2.1, 9.3.3, 9.8.2

Contractor’s Responsibility for Those Performing the Work

3.3.2, 3.18, 4.2.3, 4.3.8, 5.3.1, 6.1.3, 6.2, 6.3, 9.5.1, 10

Contractor’s Review of Contract Documents

1.5.2, 3.2, 3.7.3

Contractor’s Right to Stop the Work

9.7

Contractor’s Right to Terminate the Contract

4.3.10, 14.1

Contractor’s Submittals

3.10, 3.11, 3.12, 4.2.7, 5.2.1, 5.2.3, 7.3.6, 9.2, 9.3, 9.8.2, 9.8.3, 9.9.1, 9.10.2, 9.10.3,
11.1.3, 11.5.2

Contractor’s Superintendent

3.9, 10.2.6

Contractor’s Supervision and Construction Procedures

1.2.2, 3.3, 3.4, 3.12.10, 4.2.2, 4.2.7, 4.3.3, 6.1.3, 6.2.4, 7.1.3, 7.3.4, 7.3.6, 8.2, 10, 12, 14

Contractual Liability Insurance

11.1.1.8, 11.2, 11.3

Coordination and Correlation

1.2, 1.5.2, 3.3.1, 3.10, 3.12.6, 6.1.3, 6.2.1

Copies Furnished of Drawings and Specifications

1.6, 2.2.5, 3.11

Copyrights

1.6, 3.17

Correction of Work

2.3, 2.4, 3.7.4, 4.2.1, 9.4.2, 9.8.2, 9.8.3, 9.9.1, 12.1.2, 12.2, 13.7.1.3

Correlation and Intent of the Contract Documents

1.2

Cost, Definition of

7.3.6

Costs

2.4, 3.2.3, 3.7.4, 3.8.2, 3.15.2, 4.3, 5.4.2, 6.1.1, 6.2.3, 7.3.3.3, 7.3.6, 7.3.7, 7.3.8, 9.10.2,
10.3.2, 10.5, 11.3, 11.4, 12.1, 12.2.1, 12.2.4, 13.5, 14

Cutting and Patching

6.2.5, 3.14

Damage to Construction of Owner or Separate Contractors

3.14.2, 6.2.4, 9.2.1.5, 10.2.1.2, 10.2.5, 10.6, 11.1, 11.4, 12.2.4

Damage to the Work

3.14.2, 9.9.1, 10.2.1.2, 10.2.5, 10.6, 11.4, 12.2.4

Damages, Claims for

3.2.3, 3.18, 4.3.10, 6.1.1, 8.3.3, 9.5.1, 9.6.7, 10.3.3, 11.1.1, 11.4.5, 11.4.7, 14.1.3, 14.2.4

Damages for Delay

6.1.1, 8.3.3, 9.5.1.6, 9.7, 10.3.2

Date of Commencement of the Work, Definition of

8.1.2

Date of Substantial Completion, Definition of

8.1.3

Day, Definition of

8.1.4

Decisions of the Architect

4.2.6, 4.2.7, 4.2.11, 4.2.12, 4.2.13, 4.3.4, 4.4.1, 4.4.5, 4.4.6, 4.5, 6.3, 7.3.6, 7.3.8, 8.1.3,
8.3.1, 9.2, 9.4, 9.5.1, 9.8.4, 9.9.1, 13.5.2, 14.2.2, 14.2.4

Decisions to Withhold Certification

9.4.1, 9.5, 9.7, 14.1.1.3

Defective or Nonconforming Work, Acceptance, Rejection and Correction of

2.3, 2.4, 3.5.1, 4.2.6, 6.2.5, 9.5.1, 9.5.2, 9.6.6, 9.8.2, 9.9.3, 9.10.4, 12.2.1, 13.7.1.3

Defective Work, Definition of

3.5.1

Definitions

1.1, 2.1.1, 3.1, 3.5.1, 3.12.1, 3.12.2, 3.12.3, 4.1.1, 4.3.1, 5.1, 6.1.2, 7.2.1, 7.3.1, 7.3.6, 8.1,
9.1, 9.8.1

Delays and Extensions of Time

3.2.3, 4.3.1, 4.3.4, 4.3.7, 4.4.5, 5.2.3, 7.2.1, 7.3.1, 7.4.1, 8.3, 9.5.1, 9.7.1, 10.3.2, 10.6.1,
14.3.2

Disputes

4.1.4, 4.3, 4.4, 4.5, 4.6, 6.3, 7.3.8

Documents and Samples at the Site

3.11

Drawings, Definition of

1.1.5

Drawings and Specifications, Use and Ownership of

1.1.1, 1.3, 2.2.5, 3.11, 5.3

Effective Date of Insurance

8.2.2, 11.1.2

Emergencies

4.3.5, 10.6, 14.1.1.2

Employees, Contractor’s

3.3.2, 3.4.3, 3.8.1, 3.9, 3.18.2, 4.2.3, 4.2.6, 10.2, 10.3, 11.1.1, 11.4.7, 14.1, 14.2.1.1

Equipment, Labor, Materials and

1.1.3, 1.1.6, 3.4, 3.5.1, 3.8.2, 3.8.3, 3.12, 3.13, 3.15.1, 4.2.6, 4.2.7, 5.2.1, 6.2.1, 7.3.6,
9.3.2, 9.3.3, 9.5.1.3, 9.10.2, 10.2.1, 10.2.4, 14.2.1.2

Execution and Progress of the Work

1.1.3, 1.2.1, 1.2.2, 2.2.3, 2.2.5, 3.1, 3.3, 3.4, 3.5, 3.7, 3.10, 3.12, 3.14, 4.2.2, 4.2.3, 4.3.3,
6.2.2, 7.1.3, 7.3.4, 8.2, 9.5, 9.9.1, 10.2, 10.3, 12.2, 14.2, 14.3

Extensions of Time

3.2.3, 4.3.1, 4.3.4, 4.3.7, 4.4.5, 5.2.3, 7.2.1, 7.3, 7.4.1, 9.5.1, 9.7.1, 10.3.2, 10.6.1, 14.3.2

Failure of Payment

4.3.6, 9.5.1.3, 9.7, 9.10.2, 14.1.1.3, 14.2.1.2, 13.6

Faulty Work

(See Defective or Nonconforming Work)

Final Completion and Final Payment

4.2.1, 4.2.9, 4.3.2, 9.8.2, 9.10, 11.1.2, 11.1.3, 11.4.1, 11.4.5, 12.3.1, 13.7, 14.2.4, 14.4.3

Financial Arrangements, Owner’s

2.2.1, 13.2.2, 14.1.1.5

Fire and Extended Coverage Insurance

11.4

GENERAL PROVISIONS

1

Governing Law

13.1

Guarantees (See Warranty)

Hazardous Materials

10.2.4, 10.3, 10.5

Identification of Contract Documents

1.5.1

Identification of Subcontractors and Suppliers

5.2.1

Indemnification

3.17, 3.18, 9.10.2, 10.3.3, 10.5, 11.4.1.2, 11.4.7

Information and Services Required of the Owner

2.1.2, 2.2, 3.2.1, 3.12.4, 3.12.10, 4.2.7, 4.3.3, 6.1.3, 6.1.4, 6.2.5, 9.3.2, 9.6.1, 9.6.4, 9.9.2,
9.10.3, 10.3.3, 11.2, 11.4, 13.5.1, 13.5.2, 14.1.1.4, 14.1.4

Injury or Damage to Person or Property

4.3.8, 10.2, 10.6

Inspections

3.1.3, 3.3.3, 3.7.1, 4.2.2, 4.2.6, 4.2.9, 9.4.2, 9.8.2, 9.8.3, 9.9.2, 9.10.1, 12.2.1, 13.5

Instructions to Bidders

1.1.1

Instructions to the Contractor

3.2.3, 3.3.1, 3.8.1, 4.2.8, 5.2.1, 7, 12, 8.2.2, 13.5.2

Insurance

3.18.1, 6.1.1, 7.3.6, 8.2.1, 9.3.2, 9.8.4, 9.9.1, 9.10.2, 9.10.5, 11

Insurance, Boiler and Machinery

11.4.2

Insurance, Contractor’s Liability

11.1

Insurance, Effective Date of

8.2.2, 11.1.2

Insurance, Loss of Use

11.4.3

Insurance, Owner’s Liability

11.2

Insurance, Project Management Protective Liability

11.3

Insurance, Property

10.2.5, 11.4

Insurance, Stored Materials

9.3.2, 11.4.1.4

INSURANCE AND BONDS

11

Insurance Companies, Consent to Partial Occupancy

9.9.1, 11.4.1.5

Insurance Companies, Settlement with

11.4.10

Intent of the Contract Documents

1.2.1, 4.2.7, 4.2.12, 4.2.13, 7.4

Interest

13.6

Interpretation

1.2.3, 1.4, 4.1.1, 4.3.1, 5.1, 6.1.2, 8.1.4

Interpretations, Written

4.2.11, 4.2.12, 4.3.6

Joinder and Consolidation of Claims Required

4.6.4

Judgment on Final Award

4.6.6

Labor and Materials, Equipment

1.1.3, 1.1.6, 3.4, 3.5.1, 3.8.2, 3.8.3, 3.12, 3.13, 3.15.1, 42.6, 4.2.7, 5.2.1, 6.2.1, 7.3.6,
9.3.2, 9.3.3, 9.5.1.3, 9.10.2, 10.2.1, 10.2.4, 14.2.1.2

Labor Disputes

8.3.1

Laws and Regulations

1.6, 3.2.2, 3.6, 3.7, 3.12.10, 3.13, 4.1.1, 4.4.8, 4.6, 9.6.4, 9.9.1, 10.2.2, 11.1, 11.4, 13.1,
13.4, 13.5.1, 13.5.2, 13.6, 14

Liens

2.1.2, 4.4.8, 8.2.2, 9.3.3, 9.10

Limitation on Consolidation or Joinder

4.6.4

Limitations, Statutes of

4.6.3, 12.2.6, 13.7

Limitations of Liability

2.3, 3.2.1, 3.5.1, 3.7.3, 3.12.8, 3.12.10, 3.17, 3.18, 4.2.6, 4.2.7, 4.2.12, 6.2.2, 9.4.2, 9.6.4,
9.6.7, 9.10.4, 10.3.3, 10.2.5, 11.1.2, 11.2.1, 11.4.7, 12.2.5, 13.4.2

Limitations of Time

2.1.2, 2.2, 2.4, 3.2.1, 3.7.3, 3.10, 3.11, 3.12.5, 3.15.1, 4.2.7, 4.3, 4.4, 4.5, 4.6, 5.2, 5.3,
5.4, 6.2.4, 7.3, 7.4, 8.2, 9.2, 9.3.1, 9.3.3, 9.4.1, 9.5, 9.6, 9.7, 9.8, 9.9, 9.10, 11.1.3,
11.4.1.5, 11.4.6, 11.4.10, 12.2, 13.5, 13.7, 14

Loss of Use Insurance

11.4.3

Material Suppliers

1.6, 3.12.1, 4.2.4, 4.2.6, 5.2.1, 9.3, 9.4.2, 9.6, 9.10.5

Materials, Hazardous

10.2.4, 10.3, 10.5

Materials, Labor, Equipment and

1.1.3, 1.1.6, 1.6.1, 3.4, 3.5.1, 3.8.2, 3.8.23, 3.12, 3.13, 3.15.1, 4.2.6, 4.2.7, 5.2.1, 6.2.1,
7.3.6, 9.3.2, 9.3.3, 9.5.1.3, 9.10.2, 10.2.1, 10.2.4, 14.2.1.2

Means, Methods, Techniques, Sequences and Procedures of Construction

3.3.1, 3.12.10, 4.2.2, 4.2.7, 9.4.2

Mechanic’s Lien

4.4.8

Mediation

4.4.1, 4.4.5, 4.4.6, 4.4.8, 4.5, 4.6.1, 4.6.2, 8.3.1, 10.5

Minor Changes in the Work

1.1.1, 3.12.8, 4.2.8, 4.3.6, 7.1, 7.4

MISCELLANEOUS PROVISIONS

13

Modifications, Definition of

1.1.1

Modifications to the Contract

1.1.1, 1.1.2, 3.7.3, 3.11, 4.1.2, 4.2.1, 5.2.3, 7, 8.3.1, 9.7, 10.3.2, 11.4.1

Mutual Responsibility

6.2

Nonconforming Work, Acceptance of

9.6.6, 9.9.3, 12.3

Nonconforming Work, Rejection and Correction of

2.3, 2.4, 3.5.1, 4.2.6, 6.2.5, 9.5.1, 9.8.2, 9.9.3, 9.10.4, 12.2.1, 13.7.1.3

Notice

2.2.1, 2.3, 2.4, 3.2.3, 3.3.1, 3.7.2, 3.7.4, 3.12.9, 4.3, 4.4.8, 4.6.5, 5.2.1, 8.2.2, 9.7, 9.10,
10.2.2, 11.1.3, 11.4.6, 12.2.2, 12.2.4, 13.3, 13.5.1, 13.5.2, 14.1, 14.2

Notice, Written

2.3, 2.4, 3.3.1, 3.9, 3.12.9, 3.12.10, 4.3, 4.4.8, 4.6.5, 5.2.1, 8.2.2, 9.7, 9.10, 10.2.2, 10.3,
11.1.3, 11.4.6, 12.2.2, 12.2.4, 13.3, 14

Notice of Testing and Inspections

13.5.1, 13.5.2

Notice to Proceed

8.2.2

Notices, Permits, Fees and

2.2.2, 3.7, 3.13, 7.3.6.4, 10.2.2

Observations, Contractor’s

1.5.2, 3.2, 3.7.3, 4.3.4

Occupancy

2.2.2, 9.6.6, 9.8, 11.4.1.5

Orders, Written

1.1.1, 2.3, 3.9, 4.3.6, 7, 8.2.2, 11.4.9, 12.1, 12.2, 13.5.2, 14.3.1

OWNER

2

Owner, Definition of

2.1

Owner, Information and Services Required of the

2.1.2, 2.2, 3.2.1, 3.12.4, 3.12.10, 4.2.7, 4.3.3, 6.1.3, 6.1.4, 6.2.5, 9.3.2, 9.6.1, 9.6.4, 9.9.2,
9.10.3, 10.3.3, 11.2, 11.4, 13.5.1, 13.5.2, 14.1.1.4, 14.1.4

Owner’s Authority

1.6, 2.1.1, 2.3, 2.4, 3.4.2, 3.8.1, 3.12.10, 3.14.2, 4.1.2, 4.1.3, 4.2.4, 4.2.9, 4.3.6, 4.4.7,
5.2.1, 5.2.4, 5.4.1, 6.1, 6.3, 7.2.1, 7.3.1, 8.2.2, 8.3.1, 9.3.1, 9.3.2, 9.5.1, 9.9.1, 9.10.2,
10.3.2, 11.1.3, 11.3.1, 11.4.3, 11.4.10, 12.2.2, 12.3.1, 13.2.2, 14.3, 14.4

Owner’s Financial Capability

2.2.1, 13.2.2, 14.1.1.5

Owner’s Liability Insurance

11.2

Owner’s Loss of Use Insurance

11.4.3

Owner’s Relationship with Subcontractors

1.1.2, 5.2, 5.3, 5.4, 9.6.4, 9.10.2, 14.2.2

Owner’s Right to Carry Out the Work

2.4, 12.2.4. 14.2.2.2

Owner’s Right to Clean Up

6.3

Owner’s Right to Perform Construction and to Award Separate Contracts

6.1

Owner’s Right to Stop the Work

2.3

Owner’s Right to Suspend the Work

14.3

Owner’s Right to Terminate the Contract

14.2

Ownership and Use of Drawings, Specifications and Other Instruments of Service

1.1.1, 1.6, 2.2.5, 3.2.1, 3.11.1, 3.17.1, 4.2.12, 5.3

Partial Occupancy or Use

9.6.6, 9.9, 11.4.1.5

Patching, Cutting and

3.14, 6.2.5

Patents

3.17

Payment, Applications for

4.2.5, 7.3.8, 9.2, 9.3, 9.4, 9.5.1, 9.6.3, 9.7.1, 9.8.5, 9.10.1, 9.10.3, 9.10.5, 11.1.3, 14.2.4,
14.4.3

Payment, Certificates for

4.2.5, 4.2.9, 9.3.3, 9.4, 9.5, 9.6.1, 9.6.6, 9.7.1, 9.10.1, 9.10.3, 13.7, 14.1.1.3, 14.2.4

Payment, Failure of

4.3.6, 9.5.1.3, 9.7, 9.10.2, 14.1.1.3, 14.2.1.2, 13.6

Payment, Final

4.2.1, 4.2.9, 4.3.2, 9.8.2, 9.10, 11.1.2, 11.1.3, 11.4.1, 11.4.5, 12.3.1, 13.7, 14.2.4, 14.4.3

Payment Bond, Performance Bond and

7.3.6.4, 9.6.7, 9.10.3, 11.4.9, 11.5

Payments, Progress

4.3.3, 9.3, 9.6, 9.8.5, 9.10.3, 13.6, 14.2.3

PAYMENTS AND COMPLETION

9

Payments to Subcontractors

5.4.2, 9.5.1.3, 9.6.2, 9.6.3, 9.6.4, 9.6.7, 11.4.8, 14.2.1.2

PCB

10.3.1

Performance Bond and Payment Bond

7.3.6.4, 9.6.7, 9.10.3, 11.4.9, 11.5

Permits, Fees and Notices

2.2.2, 3.7, 3.13, 7.3.6.4, 10.2.2

PERSONS AND PROPERTY, PROTECTION OF

10

Polychlorinated Biphenyl

10.3.1

Product Data, Definition of

3.12.2

Product Data and Samples, Shop Drawings

3.11, 3.12, 4.2.7

Progress and Completion

4.2.2, 4.3.3, 8.2, 9.8, 9.9.1, 14.1.4

Progress Payments

4.3.3, 9.3, 9.6, 9.8.5, 9.10.3, 13.6, 14.2.3

Project, Definition of the

1.1.4

Project Management Protective Liability Insurance

11.3

Project Manual, Definition of the

1.1.7

Project Manuals

2.2.5

Project Representatives

4.2.10

Property Insurance

10.2.5, 11.4

PROTECTION OF PERSONS AND PROPERTY

10

Regulations and Laws

1.6, 3.2.2, 3.6, 3.7, 3.12.10, 3.13, 4.1.1, 4.4.8, 4.6, 9.6.4, 9.9.1, 10.2.2, 11.1, 11.4, 13.1,
13.4, 13.5.1, 13.5.2, 13.6, 14

Rejection of Work

3.5.1, 4.2.6, 12.2.1

Releases and Waivers of Liens

9.10.2

Representations

1.5.2, 3.5.1, 3.12.6, 6.2.2, 8.2.1, 9.3.3, 9.4.2, 9.5.1, 9.8.2, 9.10.1

Representatives

2.1.1, 3.1.1, 3.9, 4.1.1, 4.2.1, 4.2.10, 5.1.1, 5.1.2, 13.2.1

Resolution of Claims and Disputes

4.4, 4.5, 4.6

Responsibility for Those Performing the Work

3.3.2, 3.18, 4.2.3, 4.3.8, 5.3.1, 6.1.3, 6.2, 6.3, 9.5.1, 10

Retainage

9.3.1, 9.6.2, 9.8.5, 9.9.1, 9.10.2, 9.10.3

Review of Contract Documents and Field Conditions by Contractor

1.5.2, 3.2, 3.7.3, 3.12.7, 6.1.3

Review of Contractor’s Submittals by Owner and Architect

3.10.1, 3.10.2, 3.11, 3.12, 4.2, 5.2, 6.1.3, 9.2, 9.8.2

Review of Shop Drawings, Product Data and Samples by Contractor

3.12

Rights and Remedies

1.1.2, 2.3, 2.4, 3.5.1, 3.15.2, 4.2.6, 4.3.4, 4.5, 4.6, 5.3, 5.4, 6.1, 6.3, 7.3.1, 8.3, 9.5.1, 9.7,
10.2.5, 10.3, 12.2.2, 12.2.4, 13.4, 14

Royalties, Patents and Copyrights

3.17

Rules and Notices for Arbitration

4.6.2

Safety of Persons and Property

10.2, 10.6

Safety Precautions and Programs

3.3.1, 4.2.2, 4.2.7, 5.3.1, 10.1, 10.2, 10.6

Samples, Definition of

3.12.3

Samples, Shop Drawings, Product Data and

3.11, 3.12, 4.2.7

Samples at the Site, Documents and

3.11

Schedule of Values

9.2, 9.3.1

Schedules,

1.4.1.2, 3.10, 3.Construction12.1, 3.12.2, 4.3.7.2, 6.1.3

Separate Contracts and Contractors

1.1.4, 3.12.5, 3.14.2, 4.2.4, 4.2.7, 4.6.4, 6, 8.3.1, 11.4.7, 12.1.2, 12.2.5

Shop Drawings, Definition of

3.12.1

Shop Drawings, Product Data and Samples

3.11, 3.12, 4.2.7

Site, Use of

3.13, 6.1.1, 6.2.1

Site Inspections

1.2.2, 3.2.1, 3.3.3, 3.7.1, 4.2, 4.3.4, 9.4.2, 9.10.1, 13.5

Site Visits, Architect’s

4.2.2, 4.2.9, 4.3.4, 9.4.2, 9.5.1, 9.9.2, 9.10.1, 13.5

Special Inspections and Testing

4.2.6, 12.2.1, 13.5

Specifications, Definition of the

1.1.6

Specifications, The

1.1.1, 1.1.6, 1.1.7, 1.2.2, 1.6, 3.11, 3.12.10, 3.17

Statute of Limitations

4.6.3, 12.2.6, 13.7

Stopping the Work

2.3, 4.3.6, 9.7, 10.3, 14.1

Stored Materials

6.2.1, 9.3.2, 10.2.1.2, 10.2.4, 11.4.1.4

Subcontractor, Definition of

5.1.1

SUBCONTRACTORS

5

Subcontractors, Work by

1.2.2, 3.3.2, 3.12.1, 4.2.3, 5.2.3, 5.3, 5.4, 9.3.1.2, 9.6.7

Subcontractual Relations

5.3, 5.4, 9.3.1.2, 9.6, 9.10 10.2.1, 11.4.7, 11.4.8, 14.1, 14.2.1, 14.3.2

Submittals

1.6, 3.10, 3.11, 3.12, 4.2.7, 5.2.1, 5.2.3, 7.3.6, 9.2, 9.3, 9.8, 9.9.1, 9.10.2, 9.10.3, 11.1.3

Subrogation, Waivers of

6.1.1, 11.4.5, 11.4.7

Substantial Completion

4.2.9, 8.1.1, 8.1.3, 8.2.3, 9.4.2, 9.8, 9.9.1, 9.10.3, 9.10.4.2, 12.2, 13.7

Substantial Completion, Definition of

9.8.1

Substitution of Subcontractors

5.2.3, 5.2.4

Substitution of Architect

4.1.3

Substitutions of Materials

3.4.2, 3.5.1, 7.3.7

Sub-subcontractor, Definition of

5.1.2

Subsurface Conditions

4.3.4

Successors and Assigns

13.2

Superintendent

3.9, 10.2.6

Supervision and Construction Procedures

1.2.2, 3.3, 3.4, 3.12.10, 4.2.2, 4.2.7, 4.3.3, 6.1.3, 6.2.4, 7.1.3, 7.3.6, 8.2, 8.3.1, 9.4.2, 10,
12, 14

Surety

4.4.7, 5.4.1.2, 9.8.5, 9.10.2, 9.10.3, 14.2.2

Surety, Consent of

9.10.2, 9.10.3

Surveys

2.2.3

Suspension by the Owner for Convenience

14.4

Suspension of the Work

5.4.2, 14.3

Suspension or Termination of the Contract

4.3.6, 5.4.1.1, 11.4.9, 14

Taxes

3.6, 3.8.2.1, 7.3.6.4

Termination by the Contractor

4.3.10, 14.1

Termination by the Owner for Cause

4.3.10, 5.4.1.1, 14.2

Termination of the Architect

4.1.3

Termination of the Contractor

14.2.2

TERMINATION OR SUSPENSION OF THE CONTRACT

14

Tests and Inspections

3.1.3, 3.3.3, 4.2.2, 4.2.6, 4.2.9, 9.4.2, 9.8.3, 9.9.2, 9.10.1, 10.3.2, 11.4.1.1, 12.2.1,13.5

TIME

8

Time, Delays and Extensions of

3.2.3, 4.3.1, 4.3.4, 4.3.7, 4.4.5, 5.2.3, 7.2.1, 7.3.1, 7.4.1, 8.3, 9.5.1, 9.7.1, 10.3.2, 10.6.1,
14.3.2

Time Limits

2.1.2, 2.2, 2.4, 3.2.1, 3.7.3, 3.10, 3.11, 3.12.5, 3.15.1, 4.2, 4.3, 4.4, 4.5, 4.6, 5.2, 5.3, 5.4,
6.2.4, 7.3, 7.4, 8.2, 9.2, 9.3.1, 9.3.3, 9.4.1, 9.5, 9.6, 9.7, 9.8, 9.9, 9.10, 11.1.3, 11.4.1.5,
11.4.6, 11.4.10, 12.2, 13.5, 13.7, 14

Time Limits on Claims

4.3.2, 4.3.4, 4.3.8, 4.4, 4.5, 4.6

Title to Work

9.3.2, 9.3.3

UNCOVERING AND CORRECTION OF WORK

12

Uncovering of Work

12.1

Unforeseen Conditions

4.3.4, 8.3.1, 10.3

Unit Prices

4.3.9, 7.3.3.2

Use of Documents

1.1.1, 1.6, 2.2.5, 3.12.6, 5.3

Use of Site

3.13, 6.1.1, 6.2.1

Values, Schedule of

9.2, 9.3.1

Waiver of Claims by the Architect

13.4.2

Waiver of Claims by the Contractor

4.3.10, 9.10.5, 11.4.7, 13.4.2

Waiver of Claims by the Owner

4.3.10, 9.9.3, 9.10.3, 9.10.4, 11.4.3, 11.4.5, 11.4.7, 12.2.2.1, 13.4.2, 14.2.4

Waiver of Consequential Damages

4.3.10, 14.2.4

Waiver of Liens

9.10.2, 9.10.4

Waivers of Subrogation

6.1.1, 11.4.5, 11.4.7

Warranty

3.5, 4.2.9, 4.3.5.3, 9.3.3, 9.8.4, 9.9.1, 9.10.4, 12.2.2, 13.7.1.3

Weather Delays

4.3.7.2

Work, Definition of

1.1.3

Written Consent

1.6, 3.4.2, 3.12.8, 3.14.2, 4.1.2, 4.3.4, 4.6.4, 9.3.2, 9.8.5, 9.9.1, 9.10.2, 9.10.3, 11.4.1,
13.2, 13.4.2

Written Interpretations

4.2.11, 4.2.12, 4.3.6

Written Notice

2.3, 2.4, 3.3.1, 3.9, 3.12.9, 3.12.10, 4.3, 4.4.8, 4.6.5, 5.2.1, 8.2.2, 9.7, 9.10, 10.2.2, 10.3,
11.1.3, 11.4.6, 12.2.2, 12.2.4, 13.3, 14

Written Orders

1.1.1, 2.3, 3.9, 4.3.6, 7, 8.2.2, 11.4.9, 12.1, 12.2, 13.5.2, 14.3.1

3

ARTICLE 1 GENERAL PROVISIONS

§ 1.1 BASIC DEFINITIONS

§ 1.1.1 THE CONTRACT DOCUMENTS

The Contract Documents consist of the Agreement between Owner and Contractor (hereinafter the
Agreement), Conditions of the Contract (General, Supplementary and other Conditions), Drawings,
Specifications, Addenda issued prior to execution of the Contract, other documents listed in the
Agreement and Modifications issued after execution of the Contract. A Modification is (1) a written
amendment to the Contract signed by both parties, (2) a Change Order, (3) a Construction Change
Directive or (4) a written order for a minor change in the Work issued by the Architect. Unless
specifically enumerated in the Agreement, the Contract Documents do not include other documents
such as bidding requirements (advertisement or invitation to bid, Instructions to Bidders, sample
forms, the Contractor’s bid or portions of Addenda relating to bidding requirements).

§ 1.1.2 THE CONTRACT

The Contract Documents form the Contract for Construction. The Contract represents the entire and
integrated agreement between the parties hereto and supersedes prior negotiations, representations
or agreements, either written or oral. The Contract may be amended or modified only by a
Modification. The Contract Documents shall not be construed to create a contractual relationship of
any kind (1) between the Architect and Contractor, (2) between the Owner and a Subcontractor or
Sub-subcontractor, (3) between the Owner and Architect or (4) between any persons or entities other
than the Owner and Contractor. The Owner shall, however, be entitled to performance and
enforcement of obligations under the Contract intended to facilitate performance of the Architect’s
duties.

§ 1.1.3 THE WORK

The term “Work” means the construction and services required by the Contract Documents, whether
completed or partially completed, and includes all other labor, materials, equipment and services
provided or to be provided by the Contractor to fulfill the Contractor’s obligations. The Work may
constitute the whole or a part of the Project.

§ 1.1.4 THE PROJECT

The Project is the total construction of which the Work performed under the Contract Documents may
be the whole or a part and which may include construction by the Owner or by separate contractors.

§ 1.1.5 THE DRAWINGS

The Drawings are the graphic and pictorial portions of the Contract Documents showing the design,
location and dimensions of the Work, generally including plans, elevations, sections, details,
schedules and diagrams.

§ 1.1.6 THE SPECIFICATIONS

The Specifications are that portion of the Contract Documents consisting of the written
requirements for materials, equipment, systems, standards and workmanship for the Work, and
performance of related services.

§ 1.1.7 THE PROJECT MANUAL

The Project Manual is a volume assembled for the Work which may include the bidding requirements,
sample forms, Conditions of the Contract and Specifications.

§ 1.2 CORRELATION AND INTENT OF THE CONTRACT DOCUMENTS

§ 1.2.1 The intent of the Contract Documents is to include all items necessary for the proper
execution and completion of the Work by the Contractor. The Contract Documents are complementary,
and what is required by one shall be as binding as if required by all; performance by the
Contractor shall be required only to the extent consistent with the Contract Documents and
reasonably inferable from them as being necessary to produce the indicated results.

§ 1.2.2 Organization of the Specifications into divisions, sections and articles, and arrangement
of Drawings shall not control the Contractor in dividing the Work among Subcontractors or in
establishing the extent of Work to be performed by any trade.

§ 1.2.3 Unless otherwise stated in the Contract Documents, words which have well-known technical or
construction industry meanings are used in the Contract Documents in accordance with such
recognized meanings.

§ 1.3 CAPITALIZATION

§ 1.3.1 Terms capitalized in these General Conditions include those which are (1) specifically
defined, (2) the titles of numbered articles or (3) the titles of other documents published by the
American Institute of Architects.

§ 1.4 INTERPRETATION

§ 1.4.1 In the interest of brevity the Contract Documents frequently omit modifying words such as
“all” and “any” and articles such as “the” and “an,” but the fact that a modifier or an article is
absent from one statement and appears in another is not intended to affect the interpretation of
either statement.

§ 1.5 EXECUTION OF CONTRACT DOCUMENTS

§ 1.5.1 The Contract Documents shall be signed by the Owner and Contractor. If either the Owner or
Contractor or both do not sign all the Contract Documents, the Architect shall identify such
unsigned Documents upon request.

§ 1.5.2 Execution of the Contract by the Contractor is a representation that the Contractor has
visited the site, become generally familiar with local conditions under which the Work is to be
performed and correlated personal observations with requirements of the Contract Documents.

§ 1.6 OWNERSHIP AND USE OF DRAWINGS, SPECIFICATIONS AND OTHER INSTRUMENTS OF SERVICE

§ 1.6.1 The Drawings, Specifications and other documents, including those in electronic form,
prepared by the Architect and the Architect’s consultants are Instruments of Service through which
the Work to be executed by the Contractor is described. The Contractor may retain one record set.
Neither the Contractor nor any Subcontractor, Sub-subcontractor or material or equipment supplier
shall own or claim a copyright in the Drawings, Specifications and other documents prepared by the
Architect or the Architect’s consultants, and unless otherwise indicated the Architect and the
Architect’s consultants shall be deemed the authors of them and will retain all common law,
statutory and other reserved rights, in addition to the copyrights. All copies of Instruments of
Service, except the Contractor’s record set, shall be returned or suitably accounted for to the
Architect, on request, upon completion of the Work. The Drawings, Specifications and other
documents prepared by the Architect and the Architect’s consultants, and copies thereof furnished
to the Contractor, are for use solely with respect to this Project. They are not to be used by the
Contractor or any Subcontractor, Sub-subcontractor or material or equipment supplier on other
projects or for additions to this Project outside the scope of the Work without the specific
written consent of the Owner, Architect and the Architect’s consultants. The Contractor,
Subcontractors, Sub-subcontractors and material or equipment suppliers are authorized to use and
reproduce applicable portions of the Drawings, Specifications and other documents prepared by the
Architect and the Architect’s consultants appropriate to and for use in the execution of their Work
under the Contract Documents. All copies made under this authorization shall bear the statutory
copyright notice, if any, shown on the Drawings, Specifications and other documents prepared by the
Architect and the Architect’s consultants. Submittal or distribution to meet official regulatory
requirements or for other purposes in connection with this Project is not to be construed as
publication in derogation of the Architect’s or Architect’s consultants’ copyrights or other
reserved rights.

ARTICLE 2 OWNER

§ 2.1 GENERAL

§ 2.1.1 The Owner is the person or entity identified as such in the Agreement and is referred to
throughout the Contract Documents as if singular in number. The Owner shall designate in writing a
representative who shall have express authority to bind the Owner with respect to all matters
requiring the Owner’s approval or authorization. Except as otherwise provided in Section 4.2.1, the
Architect does not have such authority. The term “Owner” means the Owner or the Owner’s authorized
representative.

§ 2.1.2 The Owner shall furnish to the Contractor within fifteen days after receipt of a written
request, information necessary and relevant for the Contractor to evaluate, give notice of or
enforce mechanic’s lien rights. Such information shall include a correct statement of the record
legal title to the property on which the Project is located, usually referred to as the site, and
the Owner’s interest therein.

§ 2.2 INFORMATION AND SERVICES REQUIRED OF THE OWNER

§ 2.2.1 The Owner shall, at the written request of the Contractor, prior to commencement of the
Work and thereafter, furnish to the Contractor reasonable evidence that financial arrangements have
been made to fulfill the Owner’s obligations under the Contract. Furnishing of such evidence shall
be a condition precedent to commencement or continuation of the Work. After such evidence has been
furnished, the Owner shall not materially vary such financial arrangements without prior notice to
the Contractor.

§ 2.2.1.1 Before the Contractor begins construction, the Owner will furnish the Contractor
with a letter from the Construction Lender(reasonably acceptable to the Contractor) in which
the Construction Lender agrees to commit and set aside funds equal to the Contract Sum or
Guaranteed Maximum Price as defined in the Article 5 of the Agreement, for the benefit of
the Contractor, its subcontractors and suppliers, to pay for the work, equipment, labor,
materials, supervision and services to be furnished or performed by the Contractor under
this Contract.

§ 2.2.2 Except for permits and fees, including those required under Section 3.7.1, which are the
responsibility of the Contractor under the Contract Documents, the Owner shall secure and pay for
necessary approvals, easements, assessments and charges required for construction, use or occupancy
of permanent structures or for permanent changes in existing facilities.

§ 2.2.3 The Owner shall furnish surveys describing physical characteristics, legal limitations and
utility locations for the site of the Project, and a legal description of the site. The Contractor
shall be entitled to rely on the accuracy of information furnished by the Owner but shall exercise
proper precautions relating to the safe performance of the Work.

§ 2.2.4 Information or services required of the Owner by the Contract Documents shall be furnished
by the Owner with reasonable promptness. Any other information or services relevant to the
Contractor’s performance of the Work under the Owner’s control shall be furnished by the Owner
after receipt from the Contractor of a written request for such information or services.

§ 2.2.5 Unless otherwise provided in the Contract Documents, the Contractor will be furnished, free
of charge, such copies of Drawings and Project Manuals as are reasonably necessary for execution of
the Work.

§ 2.3 OWNER’S RIGHT TO STOP THE WORK

§ 2.3.1 If the Contractor fails to correct Work which is not in accordance with the requirements of
the Contract Documents as required by Section 12.2 or repeatedly fails to carry out Work in
accordance with the Contract Documents, the Owner may issue a written order to the Contractor to
stop the Work, or any portion thereof, until the cause for such order has been eliminated; however,
the right of the Owner to stop the Work shall not give rise to a duty on the part of the Owner to
exercise this right for the benefit of the Contractor or any other person or entity, except to the
extent required by Section 6.1.3.

§ 2.4 OWNER’S RIGHT TO CARRY OUT THE WORK

§ 2.4.1 If the Contractor defaults or neglects to carry out the Work in accordance with the
Contract Documents and fails within a seven-day period after receipt of written notice from the
Owner to commence and continue correction of such default or neglect with diligence and promptness,
the Owner may after such seven-day period give the Contractor a second written notice to correct
such deficiencies within a three-day period. If the Contractor within such three-day period after
receipt of such second notice fails to commence and continue to correct any deficiencies, the Owner
may, without prejudice to other remedies the Owner may have, correct such deficiencies. In such
case an appropriate Change Order shall be issued deducting from payments then or thereafter due the
Contractor the reasonable cost of correcting such deficiencies, including Owner’s expenses and
compensation for the Architect’s additional services made necessary by such default, neglect or
failure. Such action by the Owner and amounts charged to the Contractor are both subject to prior
approval of the Architect. If payments then or thereafter due the Contractor are not sufficient to
cover such amounts, the Contractor shall pay the difference to the Owner.

ARTICLE 3 CONTRACTOR

§ 3.1 GENERAL

§ 3.1.1 The Contractor is the person or entity identified as such in the Agreement and is referred
to throughout the Contract Documents as if singular in number. The term “Contractor” means the
Contractor or the Contractor’s authorized representative.

§ 3.1.2 The Contractor shall perform the Work in accordance with the Contract Documents.

§ 3.1.3 The Contractor shall not be relieved of obligations to perform the Work in accordance with
the Contract Documents either by activities or duties of the Architect in the Architect’s
administration of the Contract, or by tests, inspections or approvals required or performed by
persons other than the Contractor.

§ 3.2 REVIEW OF CONTRACT DOCUMENTS AND FIELD CONDITIONS BY CONTRACTOR

§ 3.2.1 Since the Contract Documents are complementary, before starting each portion of the Work,
the Contractor shall carefully study and compare the various Drawings and other Contract Documents
relative to that portion of the Work, as well as the information furnished by the Owner pursuant to
Section 2.2.3, shall take field measurements of any existing conditions related to that portion of
the Work and shall observe any conditions at the site affecting it. These obligations are for the
purpose of facilitating construction by the Contractor and are not for the purpose of discovering
errors, omissions, or inconsistencies in the Contract Documents; however, any errors,
inconsistencies or omissions discovered by the Contractor shall be reported promptly to the
Architect as a request for information in such form as the Architect may require.

§ 3.2.2 Any design errors or omissions noted by the Contractor during this review shall be reported
promptly to the Architect, but it is recognized that the Contractor’s review is made in the
Contractor’s capacity as a contractor and not as a licensed design professional unless otherwise
specifically provided in the Contract Documents. The Contractor is not required to ascertain that
the Contract Documents are in accordance with applicable laws, statutes, ordinances, building
codes, and rules and regulations, but any nonconformity discovered by or made known to the
Contractor shall be reported promptly to the Architect.

§ 3.2.3 If the Contractor believes that additional cost or time is involved because of
clarifications or instructions issued by the Architect in response to the Contractor’s notices or
requests for information pursuant to Sections 3.2.1 and 3.2.2, the Contractor shall make Claims as
provided in Sections 4.3.6 and 4.3.7. If the Contractor fails to perform the obligations of
Sections 3.2.1 and 3.2.2, the Contractor shall pay such costs and damages to the Owner as would
have been avoided if the Contractor had performed such obligations. The Contractor shall not be
liable to the Owner or Architect for damages resulting from errors, inconsistencies or omissions in
the Contract Documents or for differences between field measurements or conditions and the Contract
Documents unless the Contractor recognized such error, inconsistency, omission or difference and
knowingly failed to report it to the Architect.

§ 3.2.4 The Contractor shall not be chargeable with knowledge of or responsible for the character,
quality and quantity of subsurface conditions at the site except to the extent (i) such conditions
are specifically disclosed in the Contract Documents, (ii) such conditions were reasonably
inferable from information provided in the Contract Documents, (iii) such conditions were
reasonably visible from an inspection of the Project site, or (iv) such conditions become known to
Contractor’s or subcontractors’ or sub-subcontractors’ personnel and direction of the Owner is not
sought. The Contractor shall immediately notify the Architect and the Owner if it encounters any
such subsurface conditions which it believes could (a) endanger persons or property, or (b) justify
an increase in the Guaranteed Maximum Price or an extension of the Contract Time.

§ 3.3 SUPERVISION AND CONSTRUCTION PROCEDURES

§ 3.3.1 The Contractor shall supervise and direct the Work, using the Contractor’s best skill and
attention. The Contractor shall be solely responsible for and have control over construction means,
methods, techniques, sequences and procedures and for coordinating all portions of the Work under
the Contract, unless the Contract Documents give other specific instructions concerning these
matters. If the Contract Documents give specific instructions concerning construction means,
methods, techniques, sequences or procedures, the Contractor shall evaluate the jobsite safety
thereof and, except as stated below, shall be fully and solely responsible for the jobsite safety
of such means, methods, techniques, sequences or procedures. If the Contractor determines that such
means, methods, techniques, sequences or procedures may not be safe, the Contractor shall give
timely written notice to the Owner and Architect and shall not proceed with that portion of the
Work without further written instructions from the Architect. If the Contractor is then instructed
to proceed with the required means, methods, techniques, sequences or procedures without acceptance
of changes proposed by the Contractor, the Owner shall be solely responsible for any resulting loss
or damage.

§ 3.3.2 The Contractor shall be responsible to the Owner for acts and omissions of the Contractor’s
employees, Subcontractors and their agents and employees, and other persons or entities performing
portions of the Work for or on behalf of the Contractor or any of its Subcontractors.

§ 3.3.3 The Contractor shall be responsible for inspection of portions of Work already performed to
determine that such portions are in proper condition to receive subsequent Work.

§ 3.4 LABOR AND MATERIALS

§ 3.4.1 Unless otherwise provided in the Contract Documents, the Contractor shall provide and pay
for labor, materials, equipment, tools, construction equipment and machinery, water, heat,
utilities, transportation, and other facilities and services necessary for proper execution and
completion of the Work, whether temporary or permanent and whether or not incorporated or to be
incorporated in the Work.

§ 3.4.2 The Contractor may make substitutions only with the consent of the Owner, after evaluation
by the Architect and in accordance with a Change Order.

§ 3.4.3 The Contractor shall enforce strict discipline and good order among the Contractor’s
employees and other persons carrying out the Contract. The Contractor shall not permit employment
of unfit persons or persons not skilled in tasks assigned to them.

§ 3.5 WARRANTY

§ 3.5.1 The Contractor warrants to the Owner and Architect that materials and equipment furnished
under the Contract will be of good quality and new unless otherwise required or permitted by the
Contract Documents, that the Work will be free from defects not inherent in the quality required or
permitted, and that the Work will conform to the requirements of the Contract Documents. Work not
conforming to these requirements, including substitutions not properly approved and authorized, may
be considered defective. The Contractor’s warranty excludes remedy for damage or defect caused by
abuse, modifications not executed by the Contractor, improper or insufficient maintenance, improper
operation, or normal wear and tear and normal usage. If required by the Architect, the Contractor
shall furnish satisfactory evidence as to the kind and quality of materials and equipment.

§ 3.6 TAXES

§ 3.6.1 The Contractor shall pay sales, consumer, use and similar taxes for the Work provided by
the Contractor which are legally enacted when bids are received or negotiations concluded, whether
or not yet effective or merely scheduled to go into effect.

§ 3.7 PERMITS, FEES AND NOTICES

§ 3.7.1 Unless otherwise provided in the Contract Documents, the Contractor shall secure and pay
for the building permit and other permits and governmental fees, licenses and inspections necessary
for proper execution and completion of the Work which are customarily secured after execution of
the Contract and which are legally required when bids are received or negotiations concluded.

§ 3.7.2 The Contractor shall comply with and give notices required by laws, ordinances, rules,
regulations and lawful orders of public authorities applicable to performance of the Work.

§ 3.7.3 It is not the Contractor’s responsibility to ascertain that the Contract Documents are in
accordance with applicable laws, statutes, ordinances, building codes, and rules and regulations.
However, if the Contractor observes that portions of the Contract Documents are at variance
therewith, the Contractor shall promptly notify the Architect and Owner in writing, and necessary
changes shall be accomplished by appropriate Modification.

§ 3.7.4 If the Contractor performs Work knowing it to be contrary to laws, statutes, ordinances,
building codes, and rules and regulations without such notice to the Architect and Owner, the
Contractor shall assume appropriate responsibility for such Work and shall bear the costs
attributable to correction.

§ 3.8 ALLOWANCES

§ 3.8.1 The Contractor shall include in the Contract Sum all allowances stated in the Contract
Documents. Items covered by allowances shall be supplied for such amounts and by such persons or
entities as the Owner may direct, but the Contractor shall not be required to employ persons or
entities to whom the Contractor has reasonable objection.

§ 3.8.2 Unless otherwise provided in the Contract Documents:

	 	.1	 	allowances shall cover the cost to the Contractor of materials and equipment
delivered at the site and all required taxes, less applicable trade discounts;

	 	.2	 	Contractor’s costs for unloading and handling at the site, labor, installation
costs, overhead, profit and other expenses contemplated for stated allowance amounts
shall be included in the Contract Sum but not in the allowances;

	 	.3	 	whenever costs are more than or less than allowances, the Contract Sum shall be
adjusted accordingly by Change Order. The amount of the Change Order shall reflect (1)
the difference between actual costs and the allowances under Section 3.8.2.1 and (2)
changes in Contractor’s costs under Section 3.8.2.2.

§ 3.8.3 Materials and equipment under an allowance shall be selected by the Owner in sufficient
time to avoid delay in the Work.

§ 3.9 SUPERINTENDENT

§ 3.9.1 The Contractor shall employ a competent superintendent and necessary assistants who shall
be in attendance at the Project site during performance of the Work. The superintendent shall
represent the Contractor, and communications given to the superintendent shall be as binding as if
given to the Contractor. Important communications shall be confirmed in writing. Other
communications shall be similarly confirmed on written request in each case.

§ 3.10 CONTRACTOR’S CONSTRUCTION SCHEDULES

§ 3.10.1 The Contractor, promptly after being awarded the Contract, shall prepare and submit for
the Owner’s and Architect’s information a Contractor’s construction schedule for the Work
consistent with Exhibit “F” of the Agreement. The schedule shall not exceed time limits current
under the Contract Documents, shall be revised at appropriate intervals as required by the
conditions of the Work and Project, shall be related to the entire Project to the extent required
by the Contract Documents, and shall provide for expeditious and practicable execution of the Work.

§ 3.10.2 The Contractor shall prepare and keep current, a schedule of submittals which is
coordinated with the Contractor’s construction schedule and allows the Architect reasonable time to
review submittals.

§ 3.10.3 The Contractor shall perform the Work in general accordance with the most recent schedules
submitted to the Owner and Architect.

§ 3.11 DOCUMENTS AND SAMPLES AT THE SITE

§ 3.11.1 The Contractor shall maintain at the site for the Owner one record copy of the Drawings,
Specifications, Addenda, Change Orders and other Modifications, in good order and marked currently
to record field changes and selections made during construction, and one record copy of approved
Shop Drawings, Product Data, Samples and similar required submittals. These shall be available to
the Architect and shall be delivered to the Owner upon completion of the Work.

§ 3.12 SHOP DRAWINGS, PRODUCT DATA AND SAMPLES

§ 3.12.1 Shop Drawings are drawings, diagrams, schedules and other data specially prepared for the
Work by the Contractor or a Subcontractor, Sub-subcontractor, manufacturer, supplier or distributor
to illustrate some portion of the Work.

§ 3.12.2 Product Data are illustrations, standard schedules, performance charts, instructions,
brochures, diagrams and other information furnished by the Contractor to illustrate materials or
equipment for some portion of the Work.

§ 3.12.3 Samples are physical examples which illustrate materials, equipment or workmanship and
establish standards by which the Work will be judged.

§ 3.12.4 Shop Drawings, Product Data, Samples and similar submittals are not Contract Documents.
The purpose of their submittal is to demonstrate for those portions of the Work for which
submittals are required by the Contract Documents the way by which the Contractor proposes to
conform to the information given and the design concept expressed in the Contract Documents. Review
by the Architect is subject to the limitations of Section 4.2.7. Informational submittals upon
which the Architect is not expected to take responsive action may be so identified in the Contract
Documents. Submittals which are not required by the Contract Documents may be returned by the
Architect without action.

§ 3.12.5 The Contractor shall review for compliance with the Contract Documents, approve and submit
to the Architect Shop Drawings, Product Data, Samples and similar submittals required by the
Contract Documents with reasonable promptness and in such sequence as to cause no delay in the Work
or in the activities of the Owner or of separate contractors. Submittals which are not marked as
reviewed for compliance with the Contract Documents and approved by the Contractor may be returned
by the Architect without action.

§ 3.12.6 By approving and submitting Shop Drawings, Product Data, Samples and similar submittals,
the Contractor represents that the Contractor has determined and verified materials, field
measurements and field construction criteria related thereto, or will do so, and has checked and
coordinated the information contained within such submittals with the requirements of the Work and
of the Contract Documents.

§ 3.12.7 The Contractor shall perform no portion of the Work for which the Contract Documents
require submittal and review of Shop Drawings, Product Data, Samples or similar submittals until
the respective submittal has been approved by the Architect.

§ 3.12.8 The Work shall be in accordance with approved submittals except that the Contractor shall
not be relieved of responsibility for deviations from requirements of the Contract Documents by the
Architect’s approval of Shop Drawings, Product Data, Samples or similar submittals unless the
Contractor has specifically informed the Architect in writing of such deviation at the time of
submittal and (1) the Architect has given written approval to the specific deviation as a minor
change in the Work, or (2) a Change Order or Construction Change Directive has been issued
authorizing the deviation. The Contractor shall not be relieved of responsibility for errors or
omissions in Shop Drawings, Product Data, Samples or similar submittals by the Architect’s approval
thereof.

§ 3.12.9 The Contractor shall direct specific attention, in writing or on resubmitted Shop
Drawings, Product Data, Samples or similar submittals, to revisions other than those requested by
the Architect on previous submittals. In the absence of such written notice the Architect’s
approval of a resubmission shall not apply to such revisions.

§ 3.12.10 The Contractor shall not be required to provide professional services which constitute
the practice of architecture or engineering unless such services are specifically required by the
Contract Documents for a portion of the Work or unless the Contractor needs to provide such
services in order to carry out the Contractor’s responsibilities for construction means, methods,
techniques, sequences and procedures. The Contractor shall not be required to provide professional
services in violation of applicable law. If professional design services or certifications by a
design professional related to systems, materials or equipment are specifically required of the
Contractor by the Contract Documents, the Owner and the Architect will specify all performance and
design criteria that such services must satisfy. The Contractor shall cause such services or
certifications to be provided by a properly licensed design professional, whose signature and seal
shall appear on all drawings, calculations, specifications, certifications, Shop Drawings and other
submittals prepared by such professional. Shop Drawings and other submittals related to the Work
designed or certified by such professional, if prepared by others, shall bear such professional’s
written approval when submitted to the Architect. The Owner and the Architect shall be entitled to
rely upon the adequacy, accuracy and completeness of the services, certifications or approvals
performed by such design professionals, provided the Owner and Architect have specified to the
Contractor all performance and design criteria that such services must satisfy. Pursuant to this
Section 3.12.10, the Architect will review, approve or take other appropriate action on submittals
only for the limited purpose of checking for conformance with information given and the design
concept expressed in the Contract Documents. The Contractor shall not be responsible for the
adequacy of the performance or design criteria required by the Contract Documents.

§ 3.12.11 The Contractor has rendered and will render opinions, advice and recommendations to the
Owner and the Architect in order to help reduce the overall cost. These services are provided by
the Contractor at no additional fee. By doing so, the Contractor has not assumed any of the duties
or obligations of the Owner or Architect. The final decision as to the use of any opinions, advice
or recommendations supplied by the Contractor is, and remains, the responsibility of the Owner and
Architect.

§ 3.13 USE OF SITE

§ 3.13.1 The Contractor shall confine operations at the site to areas permitted by law, ordinances,
permits and the Contract Documents and shall not unreasonably encumber the site with materials or
equipment.

§ 3.14 CUTTING AND PATCHING

§ 3.14.1 The Contractor shall be responsible for cutting, fitting or patching required to complete
the Work or to make its parts fit together properly.

§ 3.14.2 The Contractor shall not damage or endanger a portion of the Work or fully or partially
completed construction of the Owner or separate contractors by cutting, patching or otherwise
altering such construction, or by excavation. The Contractor shall not cut or otherwise alter such
construction by the Owner or a separate contractor except with written consent of the Owner and of
such separate contractor; such consent shall not be unreasonably withheld. The Contractor shall not
unreasonably withhold from the Owner or a separate contractor the Contractor’s consent to cutting
or otherwise altering the Work.

§ 3.15 CLEANING UP

§ 3.15.1 The Contractor shall keep the premises and surrounding area free from accumulation of
waste materials or rubbish caused by operations under the Contract. At completion of the Work, the
Contractor shall remove from and about the Project waste materials, rubbish, the Contractor’s
tools, construction equipment, machinery and surplus materials.

§ 3.15.2 If the Contractor fails to clean up as provided in the Contract Documents, the Owner may
do so and the cost thereof shall be charged to the Contractor.

§ 3.16 ACCESS TO WORK

§ 3.16.1 The Contractor shall provide the Owner and Architect access to the Work in preparation and
progress wherever located.

§ 3.17 ROYALTIES, PATENTS AND COPYRIGHTS

§ 3.17.1 The Contractor shall pay all royalties and license fees. The Contractor shall defend suits
or claims for infringement of copyrights and patent rights and shall hold the Owner and Architect
harmless from loss on account thereof, but shall not be responsible for such defense or loss when a
particular design, process or product of a particular manufacturer or manufacturers is required by
the Contract Documents or where the copyright violations are contained in Drawings, Specifications
or other documents prepared by the Owner or Architect. However, if the Contractor has reason to
believe that the required design, process or product is an infringement of a copyright or a patent,
the Contractor shall be responsible for such loss unless such information is promptly furnished to
the Architect and Owner.

§ 3.18 INDEMNIFICATION

§ 3.18.1 To the fullest extent permitted by law the Contractor shall indemnify and hold harmless
the Owner, its agents and employees from and against claims, damages, losses and expenses,
including but not limited to attorneys’ fees, arising out of or resulting from performance of the
Work, provided that such claim, damage, loss or expense is attributable to bodily injury, sickness,
disease or death, or to injury to or destruction of tangible property (other than the Work itself),
but only to the extent caused by the negligent acts or omissions of the Contractor, a
Subcontractor, anyone directly or indirectly employed by them or anyone for whose acts they may be
liable, regardless of whether or not such claim, damage, loss or expense is caused in part by a
party indemnified hereunder. Such obligation shall not be construed to negate, abridge, or reduce
other rights or obligations of indemnity which would otherwise exist as to a party or person
described in this Section 3.18.

§ 3.18.2 In claims against any person or entity indemnified under this Section 3.18 by an employee
of the Contractor, a Subcontractor, anyone directly or indirectly employed by them or anyone for
whose acts they may be liable, the indemnification obligation under Section 3.18.1 shall not be
limited by a limitation on amount or type of damages, compensation or benefits payable by or for
the Contractor or a Subcontractor under workers’ compensation acts, disability benefit acts or
other employee benefit acts.

ARTICLE 4 ADMINISTRATION OF THE CONTRACT

§ 4.1 ARCHITECT

§ 4.1.1 The Architect is the person lawfully licensed to practice architecture or an entity
lawfully practicing architecture identified as such in the Agreement and is referred to throughout
the Contract Documents as if singular in number. The term “Architect” means the Architect or the
Architect’s authorized representative.

§ 4.1.2 Duties, responsibilities and limitations of authority of the Architect as set forth in the
Contract Documents shall not be restricted, modified or extended without written consent of the
Owner, Contractor and Architect. Consent shall not be unreasonably withheld.

§ 4.1.3 If the employment of the Architect is terminated, the Owner shall employ a new Architect
against whom the Contractor has no reasonable objection and whose status under the Contract
Documents shall be that of the former Architect.

§ 4.2 ARCHITECT’S ADMINISTRATION OF THE CONTRACT

§ 4.2.1 The Architect will provide administration of the Contract as described in the Contract
Documents, and will be an Owner’s representative (1) during construction, (2) until final payment
is due and (3) with the Owner’s concurrence, from time to time during the one-year period for
correction of Work described in Section 12.2. The Architect will have authority to act on behalf of
the Owner only to the extent provided in the Contract Documents, unless otherwise modified in
writing in accordance with other provisions of the Contract.

§ 4.2.2 The Architect, as a representative of the Owner, will visit the site at intervals
appropriate to the stage of the Contractor’s operations (1) to become generally familiar with and
to keep the Owner informed about the progress and quality of the portion of the Work completed, (2)
to endeavor to guard the Owner against defects and deficiencies in the Work, and (3) to determine
in general if the Work is being performed in a manner indicating that the Work, when fully
completed, will be in accordance with the Contract Documents. However, the Architect will not be
required to make exhaustive or continuous on-site inspections to check the quality or quantity of
the Work. The Architect will neither have control over or charge of, nor be responsible for, the
construction means, methods, techniques, sequences or procedures, or for the safety precautions and
programs in connection with the Work, since these are solely the Contractor’s rights and
responsibilities under the Contract Documents, except as provided in Section 3.3.1.

§ 4.2.3 The Architect will not be responsible for the Contractor’s failure to perform the Work in
accordance with the requirements of the Contract Documents. The Architect will not have control
over or charge of and will not be responsible for acts or omissions of the Contractor,
Subcontractors, or their agents or employees, or any other persons or entities performing portions
of the Work.

§ 4.2.4 Communications Facilitating Contract Administration. Except as otherwise provided in the
Contract Documents the Owner and Contractor shall keep the Architect apprised of material
communications about matters arising out of or relating to the Contract. Communications by and with
the Architect’s consultants shall be through the Architect. Communications by and with
Subcontractors and material suppliers shall be through the Contractor. Communications by and with
separate contractors shall be through the Owner.

§ 4.2.5 Based on the Architect’s evaluations of the Contractor’s Applications for Payment, the
Architect will review and certify the amounts due the Contractor and will issue Certificates for
Payment in such amounts.

§ 4.2.6 The Architect will have authority to reject Work that does not conform to the Contract
Documents. Whenever the Architect considers it necessary or advisable, the Architect will have
authority to require inspection or testing of the Work in accordance with Sections 13.5.2 and
13.5.3, whether or not such Work is fabricated, installed or completed. However, neither this
authority of the Architect nor a decision made in good faith either to exercise or not to exercise
such authority shall give rise to a duty or responsibility of the Architect to the Contractor,
Subcontractors, material and equipment suppliers, their agents or employees, or other persons or
entities performing portions of the Work.

§ 4.2.7 The Architect will review and approve or take other appropriate action upon the
Contractor’s submittals such as Shop Drawings, Product Data and Samples, but only for the limited
purpose of checking for conformance with information given and the design concept expressed in the
Contract Documents. The Architect’s action will be taken with such reasonable promptness as to
cause no delay in the Work or in the activities of the Owner, Contractor or separate contractors,
while allowing sufficient time in the Architect’s professional judgment to permit adequate review.
Review of such submittals is not conducted for the purpose of determining the accuracy and
completeness of other details such as dimensions and quantities, or for substantiating instructions
for installation or performance of equipment or systems, all of which remain the responsibility of
the Contractor as required by the Contract Documents. The Architect’s review of the Contractor’s
submittals shall not relieve the Contractor of the obligations under Sections 3.3, 3.5 and 3.12.
The Architect’s review shall not constitute approval of safety precautions or, unless otherwise
specifically stated by the Architect, of any construction means, methods, techniques, sequences or
procedures. The Architect’s approval of a specific item shall not indicate approval of an assembly
of which the item is a component.

§ 4.2.8 The Architect will prepare Change Orders and Construction Change Directives, and may
authorize minor changes in the Work as provided in Section 7.4.

§ 4.2.9 The Architect will conduct inspections to determine the date or dates of Substantial
Completion and the date of final completion, will receive and forward to the Owner, for the Owner’s
review and records, written warranties and related documents required by the Contract and assembled
by the Contractor, and will issue a final Certificate for Payment upon compliance with the
requirements of the Contract Documents.

§ 4.2.10 If the Owner and Architect agree, the Architect will provide one or more project
representatives to assist in carrying out the Architect’s responsibilities at the site. The duties,
responsibilities and limitations of authority of such project representatives shall be as set forth
in an exhibit to be incorporated in the Contract Documents.

§ 4.2.11 The Architect will interpret and decide matters concerning performance under and
requirements of, the Contract Documents on written request of either the Owner or Contractor. The
Architect’s response to such requests will be made in writing within any time limits agreed upon or
otherwise with reasonable promptness. If no agreement is made concerning the time within which
interpretations required of the Architect shall be furnished in compliance with this Section 4.2,
then delay shall not be recognized on account of failure by the Architect to furnish such
interpretations until 15 days after written request is made for them.

§ 4.2.12 Interpretations and decisions of the Architect will be consistent with the intent of and
reasonably inferable from the Contract Documents and will be in writing or in the form of drawings.
When making such interpretations and initial decisions, the Architect will endeavor to secure
faithful performance by both Owner and Contractor, will not show partiality to either and will not
be liable for results of interpretations or decisions so rendered in good faith.

§ 4.3 CLAIMS AND DISPUTES

§ 4.3.1 Definition. A Claim is a demand or assertion by one of the parties seeking, as a matter of
right, adjustment or interpretation of Contract terms, payment of money, extension of time or other
relief with respect to the terms of the Contract. The term “Claim” also includes other disputes and
matters in question between the Owner and Contractor arising out of or relating to the Contract.
Claims must be initiated by written notice. The responsibility to substantiate Claims shall rest
with the party making the Claim.

§ 4.3.2 Time Limits on Claims. Claims by either party must be initiated within 45 21 days
after occurrence of the event giving rise to such Claim or within  21 45 days after the
claimant first recognizes the condition giving rise to the Claim, whichever is later. Claims must
be initiated by written notice to the Architect and the other party.

§ 4.3.3 Continuing Contract Performance. Pending final resolution of a Claim except as otherwise
agreed in writing or as provided in Section 9.7.1 and Article 14, the Contractor shall proceed
diligently with performance of the Contract and the Owner shall continue to make payments in
accordance with the Contract Documents.

§ 4.3.4 Claims for Concealed or Unknown Conditions. If conditions are encountered at the site which
are (1) subsurface or otherwise concealed physical conditions which differ materially from those
indicated in the Contract Documents or (2) unknown physical conditions of an unusual nature, which
differ materially from those ordinarily found to exist and generally recognized as inherent in
construction activities of the character provided for in the Contract Documents, then notice by the
observing party shall be given to the other party promptly before conditions are disturbed and in
no event later than 21 days after first observance of the conditions. The Architect will promptly
investigate such conditions and, if they differ materially and cause an increase or decrease in the
Contractor’s cost of, or time required for, performance of any part of the Work, will recommend an
equitable adjustment in the Contract Sum or Contract Time, or both. If the Architect determines
that the conditions at the site are not materially different from those indicated in the Contract
Documents and that no change in the terms of the Contract is justified, the Architect shall so
notify the Owner and Contractor in writing, stating the reasons. Claims by either party in
opposition to such determination must be made within 21 days after the Architect has given notice
of the decision. If the conditions encountered are materially different, the Contract Sum and
Contract Time shall be equitably adjusted, but if the Owner and Contractor cannot agree on an
adjustment in the Contract Sum or Contract Time, the adjustment shall be referred to the Architect
for initial determination, subject to further proceedings pursuant to Section 4.4.

§ 4.3.5 Claims for Additional Cost. If the Contractor wishes to make Claim for an increase in the
Contract Sum, written notice as provided herein shall be given before proceeding to execute the
Work. Prior notice is not required for Claims relating to an emergency endangering life or property
arising under Section 10.6.

§ 4.3.6 If the Contractor believes additional cost is involved for reasons including but not
limited to (1) a written interpretation from the Architect, (2) an order by the Owner to stop the
Work where the Contractor was not at fault, (3) a written order for a minor change in the Work
issued by the Architect, (4) failure of payment by the Owner, (5) termination of the Contract by
the Owner, (6) Owner’s suspension or (7) other reasonable grounds, Claim shall be filed in
accordance with this Section 4.3.

§ 4.3.7 Claims for Additional Time

§ 4.3.7.1 If the Contractor wishes to make Claim for an increase in the Contract Time, written
notice as provided herein shall be given. The Contractor’s Claim shall include an estimate of cost
and of probable effect of delay on progress of the Work. In the case of a continuing delay only one
Claim is necessary.

§ 4.3.7.2 Adverse weather is any weather-related event which causes delay to a particular day’s
critical task that will impact the Project completion schedule. Such weather factors as, but not
limited to fog, rain, wind, and lightning could cause a delay in the schedule. The completion date
as it might be established in Article 3.3 of the Agreement does include ten (10) working days
adverse weather days. If adverse weather conditions are the basis for a Claim for additional time
or cost, such Claim shall be documented by data substantiating that the weather conditions had an
adverse effect on the scheduled construction and exceeded the specified ten (10) working days noted
above.

§ 4.3.8 Injury or Damage to Person or Property. If either party to the Contract suffers injury or
damage to person or property because of an act or omission of the other party, or of others for
whose acts such party is legally responsible, written notice of such injury or damage, whether or
not insured, shall be given to the other party within a reasonable time not exceeding 21 days after
discovery. The notice shall provide sufficient detail to enable the other party to investigate the
matter.

§ 4.3.9 If unit prices are stated in the Contract Documents or subsequently agreed upon, and if
quantities originally contemplated are materially changed in a proposed Change Order or
Construction Change Directive so that application of such unit prices to quantities of Work
proposed will cause substantial inequity to the Owner or Contractor, the applicable unit prices
shall be equitably adjusted.

§ 4.3.10 Claims for Consequential Damages. The Contractor and Owner waive Claims against each
other for consequential damages arising out of or relating to this Contract. This mutual waiver
includes:

	 	.1	 	damages incurred by the Owner for rental expenses, for losses of use, income,
profit, financing, business and reputation, and for loss of management or employee
productivity or of the services of such persons; and

	 	.2	 	damages incurred by the Contractor for principal office expenses including the
compensation of personnel stationed there, for losses of financing, business and
reputation, and for loss of profit except the Contractor’s fee on the work executed.

This mutual waiver is applicable, without limitation, to all consequential damages due to either
party’s termination in accordance with Article 14. Nothing contained in this Section 4.3.10 shall
be deemed to preclude an award of liquidated direct damages, when applicable, in accordance with
the requirements of the Contract Documents.

§ 4.4 RESOLUTION OF CLAIMS AND DISPUTES

§ 4.4.1 Decision of Architect. Claims, including those alleging an error or omission by the
Architect but excluding those arising under Sections 10.3 through 10.5, shall be referred initially
to the Architect for decision. An initial decision by the Architect shall be required as a
condition precedent to mediation, arbitration or litigation of all Claims between the Contractor
and Owner arising prior to the date final payment is due, unless 30 days have passed after the
Claim has been referred to the Architect with no decision having been rendered by the Architect.
The Architect will not decide disputes between the Contractor and persons or entities other than
the Owner.

§ 4.4.2 The Architect will review Claims and within ten days of the receipt of the Claim take one
or more of the following actions: (1) request additional supporting data from the claimant or a
response with supporting data from the other party, (2) reject the Claim in whole or in part, (3)
approve the Claim, (4) suggest a compromise, or (5) advise the parties that the Architect is unable
to resolve the Claim if the Architect lacks sufficient information to evaluate the merits of the
Claim or if the Architect concludes that, in the Architect’s sole discretion, it would be
inappropriate for the Architect to resolve the Claim.

§ 4.4.3 In evaluating Claims, the Architect may, but shall not be obligated to, consult with or
seek information from either party or from persons with special knowledge or expertise who may
assist the Architect in rendering a decision. The Architect may request the Owner to authorize
retention of such persons at the Owner’s expense.

§ 4.4.4 If the Architect requests a party to provide a response to a Claim or to furnish additional
supporting data, such party shall respond, within ten days after receipt of such request, and shall
either provide a response on the requested supporting data, advise the Architect when the response
or supporting data will be furnished or advise the Architect that no supporting data will be
furnished. Upon receipt of the response or supporting data, if any, the Architect will either
reject or approve the Claim in whole or in part.

§ 4.4.5 The Architect will approve or reject Claims by written decision, which shall state the
reasons therefor and which shall notify the parties of any change in the Contract Sum or Contract
Time or both. The approval or rejection of a Claim by the Architect shall be subject to mediation
and arbitration.

§ 4.4.6 When a written decision of the Architect states that a demand for arbitration of a Claim
covered by such decision must be made within 30 days after the date on which the party making the
demand receives the final written decision, then failure to demand arbitration within said 30 days’
period shall result in the Architect’s decision becoming final and binding upon the Owner and
Contractor. If the Architect renders a decision after arbitration proceedings have been initiated,
such decision may be entered as evidence, but shall not supersede arbitration proceedings unless
the decision is acceptable to all parties concerned.

§ 4.4.7 Upon receipt of a Claim against the Contractor or at any time thereafter, the Architect or
the Owner may, but is not obligated to, notify the surety, if any, of the nature and amount of the
Claim. If the Claim relates to a possibility of a Contractor’s default, the Architect or the Owner
may, but is not obligated to, notify the surety and request the surety’s assistance in resolving
the controversy.

§ 4.4.8 If a Claim relates to or is the subject of a mechanic’s lien, the party asserting such
Claim may proceed in accordance with applicable law to comply with the lien notice or filing
deadlines prior to resolution of the Claim by the Architect, by mediation or by arbitration.

§ 4.5 MEDIATION

§ 4.5.1 Any Claim arising out of or related to the Contract, except those waived as provided for in
Sections 4.3.10, 9.10.4 and 9.10.5 shall, after initial decision by the Architect or 30 days after
submission of the Claim to the Architect, be subject to mediation as a condition precedent to
arbitration or the institution of legal or equitable proceedings by either party.

§ 4.5.2 The parties shall endeavor to resolve their Claims by mediation which, unless the parties
mutually agree otherwise, shall be in accordance with the Construction Industry Mediation Rules of
the American Arbitration Association currently in effect. Request for mediation shall be filed in
writing with the other party to the Contract and with the American Arbitration Association. The
request may be made concurrently with the filing of a demand for arbitration but, in such event,
mediation shall proceed in advance of arbitration or legal or equitable proceedings, which shall be
stayed pending mediation for a period of 60 days from the date of filing, unless stayed for a
longer period by agreement of the parties or court order.

§ 4.5.3 The parties shall share the mediator’s fee and any filing fees equally. The mediation shall
be held in the place where the Project is located, unless another location is mutually agreed upon.
Agreements reached in mediation shall be enforceable as settlement agreements in any court having
jurisdiction thereof.

§ 4.6 ARBITRATION

§ 4.6.1 Any Claim arising out of or related to the Contract, except those waived as provided for in
Sections 4.3.10, 9.10.4 and 9.10.5, shall, after decision by the Architect or 30 days after
submission of the Claim to the Architect, be subject to arbitration. Prior to arbitration, the
parties shall endeavor to resolve disputes by mediation in accordance with the provisions of
Section 4.5.

§ 4.6.2 Claims not resolved by mediation shall be decided by arbitration which, unless the parties
mutually agree otherwise, shall be in accordance with the Construction Industry Arbitration Rules
of the American Arbitration Association currently in effect. The demand for arbitration shall be
filed in writing with the other party to the Contract and with the American Arbitration
Association, and a copy shall be filed with the Architect. All proceedings, including the hearing,
shall be conducted in the county in which the Project is located.

§ 4.6.3 A demand for arbitration shall be made within the time limits specified in Sections 4.4.6
and 4.6.1 as applicable, and in other cases within a reasonable time after the Claim has arisen,
and in no event shall it be made after the date when institution of legal or equitable proceedings
based on such Claim would be barred by the applicable statute of limitations as determined pursuant
to Section 13.7.

§ 4.6.4 Limitation on Consolidation or Joinder. No arbitration arising out of or relating to the
Contract shall include, by consolidation or joinder or in any other manner, the Architect, the
Architect’s employees or consultants, except by written consent containing specific reference to
the Agreement and signed by the Architect, Owner, Contractor and any other person or entity sought
to be joined. No arbitration shall include, by consolidation or joinder or in any other manner,
parties other than the Owner, Contractor, a separate contractor as described in Article 6 and other
persons substantially involved in a common question of fact or law whose presence is required if
complete relief is to be accorded in arbitration. No person or entity other than the Owner,
Contractor or a separate contractor as described in Article 6 shall be included as an original
third party or additional third party to an arbitration whose interest or responsibility is
insubstantial. Consent to arbitration involving an additional person or entity shall not constitute
consent to arbitration of a Claim not described therein or with a person or entity not named or
described therein. The foregoing agreement to arbitrate and other agreements to arbitrate with an
additional person or entity duly consented to by parties to the Agreement shall be specifically
enforceable under applicable law in any court having jurisdiction thereof.

§ 4.6.5 Claims and Timely Assertion of Claims. The party filing a notice of demand for arbitration
must assert in the demand all Claims then known to that party on which arbitration is permitted to
be demanded.

§ 4.6.6 Judgment on Final Award. The award rendered by the arbitrator or arbitrators shall be
final, and judgment may be entered upon it in accordance with applicable law in any court having
jurisdiction thereof.

§ 4.6.7 The arbitrator will award the prevailing party or parties actual attorneys’ and experts’
fees and expenses.

ARTICLE 5 SUBCONTRACTORS

§ 5.1 DEFINITIONS

§ 5.1.1 A Subcontractor is a person or entity who has a direct contract with the Contractor to
perform a portion of the Work at the site. The term “Subcontractor” is referred to throughout the
Contract Documents as if singular in number and means a Subcontractor or an authorized
representative of the Subcontractor. The term “Subcontractor” does not include a separate
contractor or subcontractors of a separate contractor.

§ 5.1.2 A Sub-subcontractor is a person or entity who has a direct or indirect contract with a
Subcontractor to perform a portion of the Work at the site. The term “Sub-subcontractor” is
referred to throughout the Contract Documents as if singular in number and means a
Sub-subcontractor or an authorized representative of the Sub-subcontractor.

§ 5.2 AWARD OF SUBCONTRACTS AND OTHER CONTRACTS FOR PORTIONS OF THE WORK

§ 5.2.1 Unless otherwise stated in the Contract Documents or the bidding requirements, the
Contractor, as soon as practicable after award of the Contract, shall furnish in writing to the
Owner through the Architect the names of persons or entities (including those who are to furnish
materials or equipment fabricated to a special design) proposed for each principal portion of the
Work. The Owner Architect will promptly reply to the Contractor in writing stating whether or not
the Owner or the Architect, after due investigation, has reasonable objection to any such proposed
person or entity. Failure of the Owner or Architect to reply promptly shall constitute notice of no
reasonable objection.

§ 5.2.2 The Contractor shall not contract with a proposed person or entity to whom the Owner or
Architect has made reasonable and timely objection. The Contractor shall not be required to
contract with anyone to whom the Contractor has made reasonable objection.

§ 5.2.3 If the Owner has reasonable objection to a person or entity proposed by the Contractor, the
Contractor shall propose another to whom the Owner has no reasonable objection. If the proposed but
rejected Subcontractor was reasonably capable of performing the Work, the Contract Sum and Contract
Time shall be increased or decreased by the difference, if any, occasioned by such change, and an
appropriate Change Order shall be issued before commencement of the substitute Subcontractor’s
Work. However, no increase in the Contract Sum or Contract Time shall be allowed for such change
unless the Contractor has acted promptly and responsively in submitting names as required.

§ 5.2.4 The Contractor shall not change a Subcontractor, person or entity previously selected if
the Owner or Architect makes reasonable objection to such substitute.

§ 5.3 SUBCONTRACTUAL RELATIONS

§ 5.3.1 By appropriate written agreement, the Contractor shall require each Subcontractor, to the
extent of the Work to be performed by the Subcontractor, to be bound to the Contractor by terms of
the Contract Documents, and to assume toward the Contractor all the obligations and
responsibilities, including the responsibility for safety of the Subcontractor’s Work, which the
Contractor, by these Documents, assumes toward the Owner. . Each subcontract agreement shall
preserve and protect the rights of the Owner under the Contract Documents with respect to the Work
to be performed by the Subcontractor so that subcontracting thereof will not prejudice such rights,
and shall allow to the Subcontractor, unless specifically provided otherwise in the subcontract
agreement, the benefit of all rights, remedies and redress against the Contractor that the
Contractor, by the Contract Documents, has against the Owner. Where appropriate, the Contractor
shall require each Subcontractor to enter into similar agreements with Sub-subcontractors. The
Contractor shall make available to each proposed Subcontractor, prior to the execution of the
subcontract agreement, copies of the Contract Documents to which the Subcontractor will be bound,
and, upon written request of the Subcontractor, identify to the Subcontractor terms and conditions
of the proposed subcontract agreement which may be at variance with the Contract Documents.
Subcontractors will similarly make copies of applicable portions of such documents available to
their respective proposed Sub-subcontractors.

§ 5.4 CONTINGENT ASSIGNMENT OF SUBCONTRACTS

§ 5.4.1 Each subcontract agreement for a portion of the Work is assigned by the Contractor to the
Owner provided that:

	 	.1	 	assignment is effective only after termination of the Contract by the Owner
pursuant to Section 14.2 or 14.4 and only for those subcontract agreements which the
Owner accepts by notifying the Subcontractor and Contractor in writing; and

	 	.2	 	assignment is subject to the prior rights of the surety, if any, obligated
under bond relating to the Contract.

§ 5.4.2 Upon such assignment, if the Work has been suspended for more than 30 days, the
Subcontractor’s compensation shall be equitably adjusted for increases in cost resulting from the
suspension.

ARTICLE 6 CONSTRUCTION BY OWNER OR BY SEPARATE CONTRACTORS

§ 6.1 OWNER’S RIGHT TO PERFORM CONSTRUCTION AND TO AWARD SEPARATE CONTRACTS

§ 6.1.1 The Owner reserves the right to perform construction or operations related to the Project
with the Owner’s own forces, and to award separate contracts in connection with other portions of
the Project or other construction or operations on the site under Conditions of the Contract
identical or substantially similar to these including those portions related to insurance and
waiver of subrogation. If the Contractor claims that delay or additional cost is involved because
of such action by the Owner, the Contractor shall make such Claim as provided in Section 4.3.

§ 6.1.2 When separate contracts are awarded for different portions of the Project or other
construction or operations on the site, the term “Contractor” in the Contract Documents in each
case shall mean the Contractor who executes each separate Owner-Contractor Agreement.

§ 6.1.3 The Owner shall provide for coordination of the activities of the Owner’s own forces and of
each separate contractor with the Work of the Contractor, who shall cooperate with them. The
Contractor shall participate with other separate contractors and the Owner in reviewing their
construction schedules when directed to do so. The Contractor shall make any revisions to the
construction schedule deemed necessary after a joint review and mutual agreement. The construction
schedules shall then constitute the schedules to be used by the Contractor, separate contractors
and the Owner until subsequently revised.

§ 6.1.4 Unless otherwise provided in the Contract Documents, when the Owner performs construction
or operations related to the Project with the Owner’s own forces, the Owner shall be deemed to be
subject to the same obligations and to have the same rights which apply to the Contractor under the
Conditions of the Contract, including, without excluding others, those stated in Article 3, this
Article 6 and Articles 10, 11 and 12.

§ 6.2 MUTUAL RESPONSIBILITY

§ 6.2.1 The Contractor shall afford the Owner and separate contractors reasonable opportunity for
introduction and storage of their materials and equipment and performance of their activities, and
shall connect and coordinate the Contractor’s construction and operations with theirs as required
by the Contract Documents.

§ 6.2.2 If part of the Contractor’s Work depends for proper execution or results upon construction
or operations by the Owner or a separate contractor, the Contractor shall, prior to proceeding with
that portion of the Work, promptly report to the Architect apparent discrepancies or defects in
such other construction that would render it unsuitable for such proper execution and results.
Failure of the Contractor so to report shall constitute an acknowledgment that the Owner’s or
separate contractor’s completed or partially completed construction is fit and proper to receive
the Contractor’s Work, except as to defects not then reasonably discoverable.

§ 6.2.3 The Owner shall be reimbursed by the Contractor for costs incurred by the Owner which are
payable to a separate contractor because of delays, improperly timed activities or defective
construction of the Contractor. The Owner shall be responsible to the Contractor for costs incurred
by the Contractor because of delays, improperly timed activities, damage to the Work or defective
construction of a separate contractor.

§ 6.2.4 The Contractor shall promptly remedy damage wrongfully caused by the Contractor to
completed or partially completed construction or to property of the Owner or separate contractors
as provided in Section 10.2.5.

§ 6.2.5 The Owner and each separate contractor shall have the same responsibilities for cutting and
patching as are described for the Contractor in Section 3.14.

§ 6.3 OWNER’S RIGHT TO CLEAN UP

§ 6.3.1 If a dispute arises among the Contractor, separate contractors and the Owner as to the
responsibility under their respective contracts for maintaining the premises and surrounding area
free from waste materials and rubbish, the Owner may clean up and the Architect will allocate the
cost among those responsible.

ARTICLE 7 CHANGES IN THE WORK

§ 7.1 GENERAL

§ 7.1.1 Changes in the Work may be accomplished after execution of the Contract, and without
invalidating the Contract, by Change Order, Construction Change Directive or order for a minor
change in the Work, subject to the limitations stated in this Article 7 and elsewhere in the
Contract Documents.

§ 7.1.2 A Change Order shall be based upon agreement among the Owner, Contractor and Architect; a
Construction Change Directive requires agreement by the Owner and Architect and may or may not be
agreed to by the Contractor; an order for a minor change in the Work may be issued by the Architect
alone.

§ 7.1.3 Changes in the Work shall be performed under applicable provisions of the Contract
Documents, and the Contractor shall proceed promptly, unless otherwise provided in the Change
Order, Construction Change Directive or order for a minor change in the Work.

§ 7.2 CHANGE ORDERS

§ 7.2.1 A Change Order is a written instrument prepared by the Architect and signed by the Owner,
Contractor and Architect, stating their agreement upon all of the following:

	 	 	 
	.1

..2

..3

	 	change in the Work;

the amount of the adjustment, if any, in the Contract Sum; and

the extent of the adjustment, if any, in the Contract Time.

§ 7.2.2 Methods used in determining adjustments to the Contract Sum may include those listed in
Section 7.3.3.

§ 7.3 CONSTRUCTION CHANGE DIRECTIVES

§ 7.3.1 A Construction Change Directive is a written order prepared by the Architect and signed by
the Owner and Architect, directing a change in the Work prior to agreement on adjustment, if any,
in the Contract Sum or Contract Time, or both. The Owner may by Construction Change Directive,
without invalidating the Contract, order changes in the Work within the general scope of the
Contract consisting of additions, deletions or other revisions, the Contract Sum and Contract Time
being adjusted accordingly.

§ 7.3.2 A Construction Change Directive shall be used in the absence of total agreement on the
terms of a Change Order.

§ 7.3.3 If the Construction Change Directive provides for an adjustment to the Contract Sum, the
adjustment shall be based on one of the following methods:

	 	.1	 	mutual acceptance of a lump sum properly itemized and supported by sufficient
substantiating data to permit evaluation;

	 	.2	 	unit prices stated in the Contract Documents or subsequently agreed upon;

	 	.3	 	cost to be determined in a manner agreed upon by the parties and a mutually
acceptable fixed or percentage fee; or

	 	.4	 	as provided in Section 7.3.6.

§ 7.3.4 Upon receipt of a Construction Change Directive, the Contractor shall promptly proceed with
the change in the Work involved and advise the Architect of the Contractor’s agreement or
disagreement with the method, if any, provided in the Construction Change Directive for determining
the proposed adjustment in the Contract Sum or Contract Time.

§ 7.3.5 A Construction Change Directive signed by the Contractor indicates the agreement of the
Contractor therewith, including adjustment in Contract Sum and Contract Time or the method for
determining them. Such agreement shall be effective immediately and shall be recorded as a Change
Order.

§ 7.3.6 If the Contractor does not respond promptly or disagrees with the method for adjustment in
the Contract Sum, the method and the adjustment shall be determined by the Architect on the basis
of reasonable expenditures and savings of those performing the Work attributable to the change,
including, in case of an increase in the Contract Sum, a reasonable allowance for overhead and
profit. In such case, and also under Section 7.3.3.3, the Contractor shall keep and present, in
such form as the Architect may prescribe, an itemized accounting together with appropriate
supporting data. Unless otherwise provided in the Contract Documents, costs for the purposes of
this Section 7.3.6 shall be limited to Article 7 of the Agreement.

§ 7.3.7 The amount of credit to be allowed by the Contractor to the Owner for a deletion or change
which results in a net decrease in the Contract Sum shall be actual net cost as confirmed by the
Architect. When both additions and credits covering related Work or substitutions are involved in a
change, the allowance for overhead and profit shall be figured on the basis of net increase, if
any, with respect to that change.

§ 7.3.8 Pending final determination of the total cost of a Construction Change Directive to the
Owner, amounts not in dispute for such changes in the Work shall be included in Applications for
Payment accompanied by a Change Order indicating the parties’ agreement with part or all of such
costs. For any portion of such cost that remains in dispute, the Architect will make an interim
determination for purposes of monthly certification for payment for those costs. That determination
of cost shall adjust the Contract Sum on the same basis as a Change Order, subject to the right of
either party to disagree and assert a claim in accordance with Article 4.

§ 7.3.9 When the Owner and Contractor agree with the determination made by the Architect concerning
the adjustments in the Contract Sum and Contract Time, or otherwise reach agreement upon the
adjustments, such agreement shall be effective immediately and shall be recorded by preparation and
execution of an appropriate Change Order.

§ 7.4 MINOR CHANGES IN THE WORK

§ 7.4.1 The Architect will have authority to order minor changes in the Work not involving
adjustment in the Contract Sum or extension of the Contract Time and not inconsistent with the
intent of the Contract Documents. Such changes shall be effected by written order and shall be
binding on the Owner and Contractor. The Contractor shall carry out such written orders promptly.

ARTICLE 8 TIME

§ 8.1 DEFINITIONS

§ 8.1.1 Unless otherwise provided, Contract Time is the period of time, including authorized
adjustments, allotted in the Contract Documents for Substantial Completion of the Work.

§ 8.1.2 The date of commencement of the Work is the date established in the Agreement.

§ 8.1.3 The date of Substantial Completion is the date certified by the Architect in accordance
with Section 9.8.

§ 8.1.4 The term “day” as used in the Contract Documents shall mean calendar day. The term
“Working Days” as used in the Contract Documents shall mean Monday through Friday excluding
weekends and holidays.

§ 8.2 PROGRESS AND COMPLETION

§ 8.2.1 Time limits stated in the Contract Documents are of the essence of the Contract. By
executing the Agreement the Contractor confirms that the Contract Time is a reasonable period for
performing the Work.

§ 8.2.2 The Contractor shall not knowingly, except by agreement or instruction of the Owner in
writing, prematurely commence operations on the site or elsewhere prior to the effective date of
insurance required by Article 11 to be furnished by the Contractor and Owner. The date of
commencement of the Work shall not be changed by the effective date of such insurance. Unless the
date of commencement is established by the Contract Documents or a notice to proceed given by the
Owner, the Contractor shall notify the Owner in writing not less than five days or other agreed
period before commencing the Work to permit the timely filing of mortgages, mechanic’s liens and
other security interests.

§ 8.2.3 The Contractor shall proceed expeditiously with adequate forces and shall achieve
Substantial Completion within the Contract Time.

§ 8.3 DELAYS AND EXTENSIONS OF TIME

§ 8.3.1 If the Contractor is delayed at any time in the commencement or progress of the Work by an
act or neglect of the Owner or Architect, or of an employee of either, or of a separate contractor
employed by the Owner, or by changes ordered in the Work, or by labor disputes, fire, unusual delay
in deliveries, unavoidable casualties or other causes beyond the Contractor’s control, or by delay
authorized by the Owner pending mediation and arbitration, or by other causes which the Architect
determines may justify delay, then the Contract Time shall be extended by Change Order for the
amount of time that the critical path of the construction schedule is delayed by such events.

§ 8.3.2 Claims relating to time shall be made in accordance with applicable provisions of Section
4.3.

§ 8.3.3 This Section 8.3 does not preclude recovery of damages for delay by either party under
other provisions of the Contract Documents.

ARTICLE 9 PAYMENTS AND COMPLETION

§ 9.1 CONTRACT SUM

§ 9.1.1 The Contract Sum is stated in the Agreement and, including authorized adjustments, is the
total amount payable by the Owner to the Contractor for performance of the Work under the Contract
Documents.

§ 9.2 SCHEDULE OF VALUES

§ 9.2.1 Before the first Application for Payment, the Contractor shall submit to the Owner a
schedule of values allocated to various portions of the Work, prepared in such form and supported
by such data to substantiate its accuracy as the Owner may require. This schedule, unless objected
to by the Owner      , shall be used as a basis for reviewing the Contractor’s Applications for
Payment.

§ 9.3 APPLICATIONS FOR PAYMENT

§ 9.3.1 At least ten days before the end of the month the Contractor shall submit to the Architect
and Owner an itemized Application for Payment for operations completed in accordance with the
schedule of values. Such application shall be notarized, if required, and supported by such data
substantiating the Contractor’s right to payment as the Owner or Architect may require, such as
copies of requisitions from Subcontractors and material suppliers, and reflecting retainage if
provided for in the Contract Documents.

§ 9.3.1.1 As provided in Section 7.3.8, such applications may include requests for payment on
account of changes in the Work which have been properly authorized by Construction Change
Directives, or by interim determinations of the Architect, but not yet included in Change Orders.

§ 9.3.1.2 Such applications may not include requests for payment for portions of the Work for which
the Contractor does not intend to pay to a Subcontractor or material supplier, unless such Work has
been performed by others whom the Contractor intends to pay.

§ 9.3.1.3 Contractor shall include executed conditional mechanics’ lien releases for payments to
itself and Subcontractors included in the current application for payment. The Contractor will
provide executed unconditional mechanics’ lien releases for payments previously made to itself and
Subcontractors before the next payment is made by Owner.

§ 9.3.2 Unless otherwise provided in the Contract Documents, payments shall be made on account of
materials and equipment delivered and suitably stored at the site for subsequent incorporation in
the Work. If approved in advance by the Owner, payment may similarly be made for materials and
equipment suitably stored off the site at a location agreed upon in writing. Payment for materials
and equipment stored on or off the site shall be conditioned upon compliance by the Contractor with
procedures satisfactory to the Owner to establish the Owner’s title to such materials and equipment
or otherwise protect the Owner’s interest, and shall include the costs of applicable insurance,
storage and transportation to the site for such materials and equipment stored off the site.

§ 9.3.3 The Contractor warrants that title to all Work covered by an Application for Payment will
pass to the Owner no later than the time of payment. The Contractor further warrants that upon
submittal of an Application for Payment all Work for which Certificates for Payment have been
previously issued and payments received from the Owner shall, be free and clear of liens, claims,
security interests or encumbrances in favor of the Contractor, Subcontractors, material suppliers,
or other persons or entities making a claim by reason of having provided labor, materials and
equipment relating to the Work.

§ 9.4 CERTIFICATES FOR PAYMENT

§ 9.4.1 The Architect will, within seven days after receipt of the Contractor’s Application for
Payment, either issue to the Owner a Certificate for Payment, with a copy to the Contractor, for
such amount as the Architect determines is properly due, or notify the Contractor and Owner in
writing of the Architect’s reasons for withholding certification in whole or in part as provided in
Section 9.5.1.

§ 9.4.2 The issuance of a Certificate for Payment will constitute a representation by the Architect
to the Owner, based on the Architect’s evaluation of the Work and the data comprising the
Application for Payment, that the Work has progressed to the point indicated and that, to the best
of the Architect’s knowledge, information and belief, the quality of the Work is in accordance with
the Contract Documents. The foregoing representations are subject to an evaluation of the Work for
conformance with the Contract Documents upon Substantial Completion, to results of subsequent tests
and inspections, to correction of minor deviations from the Contract Documents prior to completion
and to specific qualifications expressed by the Architect. The issuance of a Certificate for
Payment will further constitute a representation that the Contractor is entitled to payment in the
amount certified. However, the issuance of a Certificate for Payment will not be a representation
that the Architect has (1) made exhaustive or continuous on-site inspections to check the quality
or quantity of the Work, (2) reviewed construction means, methods, techniques, sequences or
procedures, (3) reviewed copies of requisitions received from Subcontractors and material suppliers
and other data requested by the Owner to substantiate the Contractor’s right to payment, or (4)
made examination to ascertain how or for what purpose the Contractor has used money previously paid
on account of the Contract Sum.

§ 9.5 DECISIONS TO WITHHOLD CERTIFICATION

§ 9.5.1 The Architect may withhold a Certificate for Payment in whole or in part, to the extent
reasonably necessary to protect the Owner, if in the Architect’s opinion the representations to the
Owner required by Section 9.4.2 cannot be made. If the Architect is unable to certify payment in
the amount of the Application, the Architect will notify the Contractor and Owner as provided in
Section 9.4.1. If the Contractor and Architect cannot agree on a revised amount, the Architect will
promptly issue a Certificate for Payment for the amount for which the Architect is able to make
such representations to the Owner. The Architect may also withhold a Certificate for Payment or,
because of subsequently discovered evidence, may nullify the whole or a part of a Certificate for
Payment previously issued, to such extent as may be necessary in the Architect’s opinion to protect
the Owner from loss for which the Contractor is responsible, including loss resulting from acts and
omissions described in Section 3.3.2, because of:

	 	.1	 	defective Work not remedied;

	 	.2	 	third party claims filed or reasonable evidence indicating probable filing of
such claims unless security acceptable to the Owner is provided by the Contractor;

	 	.3	 	failure of the Contractor to make payments properly to Subcontractors or for
labor, materials or equipment;

	 	.4	 	reasonable evidence that the Work cannot be completed by the Contractor for
the unpaid balance of the Contract Sum;

	 	.5	 	damage to the Owner or another contractor;

	 	.6	 	reasonable evidence that the Work will not be completed within the Contract
Time, and that the Contractor would not be able to cover actual or liquidated damages
for the anticipated delay; or

	 	.7	 	persistent failure to carry out the Work in accordance with the Contract
Documents.

§ 9.5.2 When the above reasons for withholding certification are removed, certification will be
made for amounts previously withheld.

§ 9.6 PROGRESS PAYMENTS

§ 9.6.1 After the Architect has issued a Certificate for Payment, the Owner shall make payment in
the manner and within the time provided in the Contract Documents, and shall so notify the
Architect.

§ 9.6.2 The Contractor shall promptly pay each Subcontractor, upon receipt of payment from the
Owner, out of the amount paid to the Contractor on account of such Subcontractor’s portion of the
Work, the amount to which said Subcontractor is entitled, reflecting percentages actually retained
from payments to the Contractor on account of such Subcontractor’s portion of the Work. The
Contractor shall, by appropriate agreement with each Subcontractor, require each Subcontractor to
make payments to Sub-subcontractors in a similar manner.

§ 9.6.3 The Architect will, on request, furnish to a Subcontractor, if practicable, information
regarding percentages of completion or amounts applied for by the Contractor and action taken
thereon by the Architect and Owner on account of portions of the Work done by such Subcontractor.

§ 9.6.4 Neither the Owner nor Architect shall have an obligation to pay or to see to the payment of
money to a Subcontractor except as may otherwise be required by law.

§ 9.6.5 Payment to material suppliers shall be treated in a manner similar to that provided in
Sections 9.6.2, 9.6.3 and 9.6.4.

§ 9.6.6 A Certificate for Payment, a progress payment, or partial or entire use or occupancy of the
Project by the Owner shall not constitute acceptance of Work not in accordance with the Contract
Documents.

§ 9.6.7 Unless the Contractor provides the Owner with a payment bond in the full penal sum of the
Contract Sum, payments received by the Contractor for Work properly performed by Subcontractors and
suppliers shall be held by the Contractor for those Subcontractors or suppliers who performed Work
or furnished materials, or both, under contract with the Contractor for which payment was made by
the Owner. Nothing contained herein shall require money to be placed in a separate account and not
commingled with money of the Contractor, shall create any fiduciary liability or tort liability on
the part of the Contractor for breach of trust or shall entitle any person or entity to an award of
punitive damages against the Contractor for breach of the requirements of this provision.

§ 9.7 FAILURE OF PAYMENT

§ 9.7.1 If the Architect does not issue a Certificate for Payment, through no fault of the
Contractor, within seven days after receipt of the Contractor’s Application for Payment, or if the
Owner does not pay the Contractor within seven days after the date established in the Contract
Documents the amount certified by the Architect or awarded by arbitration, then the Contractor may
stop the Work until payment of the amount owing has been received. The Contract Time shall be
extended appropriately and the Contract Sum shall be increased by the amount of the Contractor’s
reasonable costs of shut-down, delay and start-up, plus interest as provided for in the Contract
Documents.

§ 9.8 SUBSTANTIAL COMPLETION

§ 9.8.1 Substantial Completion is the stage in the progress of the Work when the Work or designated
portion thereof is sufficiently complete in accordance with the Contract Documents so that the
Owner can occupy or utilize the Work for its intended use.

§ 9.8.2 When the Contractor considers that the Work, or a portion thereof which the Owner agrees to
accept separately, is substantially complete, the Contractor shall prepare and submit to the
Architect a comprehensive list of items to be completed or corrected prior to final payment.
Failure to include an item on such list does not alter the responsibility of the Contractor to
complete all Work in accordance with the Contract Documents.

§ 9.8.3 Upon receipt of the Contractor’s list, the Architect will make an inspection to determine
whether the Work or designated portion thereof is substantially complete. If the Architect’s
inspection discloses any item, whether or not included on the Contractor’s list, which is not
sufficiently complete in accordance with the Contract Documents so that the Owner can occupy or
utilize the Work or designated portion thereof for its intended use, the Contractor shall, before
issuance of the Certificate of Substantial Completion, complete or correct such item upon
notification by the Architect. In such case, the Contractor shall then submit a request for another
inspection by the Architect to determine Substantial Completion.

§ 9.8.4 When the Work or designated portion thereof is substantially complete, the Architect will
prepare a Certificate of Substantial Completion which shall establish the date of Substantial
Completion, shall establish responsibilities of the Owner and Contractor for security, maintenance,
heat, utilities, damage to the Work and insurance, and shall fix the time within which the
Contractor shall finish all items on the list accompanying the Certificate. Warranties required by
the Contract Documents shall commence on the date of Substantial Completion of the Work or
designated portion thereof unless otherwise provided in the Certificate of Substantial Completion.

§ 9.8.5 The Certificate of Substantial Completion shall be submitted to the Owner and Contractor
for their written acceptance of responsibilities assigned to them in such Certificate. Upon such
acceptance and consent of surety, if any, the Owner shall make payment of retainage applying to
such Work or designated portion thereof. Such payment shall be adjusted for Work that is incomplete
or not in accordance with the requirements of the Contract Documents.

§ 9.9 PARTIAL OCCUPANCY OR USE

§ 9.9.1 The Owner may occupy or use any completed or partially completed portion of the Work at any
stage when such portion is designated by separate agreement with the Contractor, provided such
occupancy or use is consented to by the insurer as required under Section 11.4.1.5 and authorized
by public authorities having jurisdiction over the Work. Such partial occupancy or use may commence
whether or not the portion is substantially complete, provided the Owner and Contractor have
accepted in writing the responsibilities assigned to each of them for payments, retainage, if any,
security, maintenance, heat, utilities, damage to the Work and insurance, and have agreed in
writing concerning the period for correction of the Work and commencement of warranties required by
the Contract Documents. When the Contractor considers a portion substantially complete, the
Contractor shall prepare and submit a list to the Architect as provided under Section 9.8.2.
Consent of the Contractor to partial occupancy or use shall not be unreasonably withheld. The stage
of the progress of the Work shall be determined by written agreement between the Owner and
Contractor or, if no agreement is reached, by decision of the Architect.

§ 9.9.2 Immediately prior to such partial occupancy or use, the Owner, Contractor and Architect
shall jointly inspect the area to be occupied or portion of the Work to be used in order to
determine and record the condition of the Work.

§ 9.9.3 Unless otherwise agreed upon, partial occupancy or use of a portion or portions of the Work
shall not constitute acceptance of Work not complying with the requirements of the Contract
Documents.

§ 9.10 FINAL COMPLETION AND FINAL PAYMENT

§ 9.10.1 Upon receipt of written notice that the Work is ready for final inspection and acceptance
and upon receipt of a final Application for Payment, the Architect will promptly make such
inspection and, when the Architect finds the Work acceptable under the Contract Documents and the
Contract fully performed, the Architect will promptly issue a final Certificate for Payment stating
that to the best of the Architect’s knowledge, information and belief, and on the basis of the
Architect’s on-site visits and inspections, the Work has been completed in accordance with terms
and conditions of the Contract Documents and that the entire balance found to be due the Contractor
and noted in the final Certificate is due and payable. The Architect’s final Certificate for
Payment will constitute a further representation that conditions listed in Section 9.10.2 as
precedent to the Contractor’s being entitled to final payment have been fulfilled.

§ 9.10.2 Neither final payment nor any remaining retained percentage shall become due until the
Contractor submits to the Architect (1) an affidavit that payrolls, bills for materials and
equipment, and other indebtedness connected with the Work for which the Owner or the Owner’s
property might be responsible or encumbered (less amounts withheld by Owner) have been paid or
otherwise satisfied, (2) a certificate evidencing that insurance required by the Contract Documents
to remain in force after final payment is currently in effect and will not be canceled or allowed
to expire until at least 30 days’ prior written notice has been given to the Owner, (3) a written
statement that the Contractor knows of no substantial reason that the insurance will not be
renewable to cover the period required by the Contract Documents, (4) consent of surety, if any, to
final payment and (5), if required by the Owner, other data establishing payment or satisfaction of
obligations, such as receipts, releases and waivers of liens, claims, security interests or
encumbrances arising out of the Contract, to the extent and in such form as may be designated by
the Owner. If a Subcontractor refuses to furnish a release or waiver required by the Owner, the
Contractor may furnish a bond satisfactory to the Owner to indemnify the Owner against such lien.
If such lien remains unsatisfied after payments are made, the Contractor shall refund to the Owner
all money that the Owner may be compelled to pay in discharging such lien, including all costs and
reasonable attorneys’ fees.

§ 9.10.3 If, after Substantial Completion of the Work, final completion thereof is materially
delayed through no fault of the Contractor or by issuance of Change Orders affecting final
completion, and the Architect so confirms, the Owner shall, upon application by the Contractor and
certification by the Architect, and without terminating the Contract, make payment of the balance
due for that portion of the Work fully completed and accepted. If the remaining balance for Work
not fully completed or corrected is less than retainage stipulated in the Contract Documents, and
if bonds have been furnished, the written consent of surety to payment of the balance due for that
portion of the Work fully completed and accepted shall be submitted by the Contractor to the
Architect prior to certification of such payment. Such payment shall be made under terms and
conditions governing final payment, except that it shall not constitute a waiver of claims.

§ 9.10.4 The making of final payment shall constitute a waiver of Claims by the Owner except those
arising from:

	 	.1	 	liens, Claims, security interests or encumbrances arising out of the Contract
and unsettled;

	 	.2	 	failure of the Work to comply with the requirements of the Contract Documents;
or

	 	.3	 	terms of special warranties required by the Contract Documents, or provided
therein, including but not limited to the warranties stated in Section 3.5 of these
General Conditions.

§ 9.10.5 Acceptance of final payment by the Contractor, a Subcontractor or material supplier shall
constitute a waiver of claims by that payee except those previously made in writing and identified
by that payee as unsettled at the time of final Application for Payment.

ARTICLE 10 PROTECTION OF PERSONS AND PROPERTY

§ 10.1 SAFETY PRECAUTIONS AND PROGRAMS

§ 10.1.1 The Contractor shall be responsible for initiating, maintaining and supervising all safety
precautions and programs in connection with the performance of the Contract.

§ 10.2 SAFETY OF PERSONS AND PROPERTY

§ 10.2.1 The Contractor shall take reasonable precautions for safety of, and shall provide
reasonable protection to prevent damage, injury or loss to:

	 	.1	 	employees on the Work and other persons who may be affected thereby;

	 	.2	 	the Work and materials and equipment to be incorporated therein, whether in
storage on or off the site, under care, custody or control of the Contractor or the
Contractor’s Subcontractors or Sub-subcontractors; and

	 	.3	 	other property at the site or adjacent thereto, such as trees, shrubs, lawns,
walks, pavements, roadways, structures and utilities not designated for removal,
relocation or replacement in the course of construction.

§ 10.2.2 The Contractor shall give notices and comply with applicable laws, ordinances, rules,
regulations and lawful orders of public authorities bearing on safety of persons or property or
their protection from damage, injury or loss.

§ 10.2.3 The Contractor shall erect and maintain, as required by existing conditions and
performance of the Contract, reasonable safeguards for safety and protection, including posting
danger signs and other warnings against hazards, promulgating safety regulations and notifying
owners and users of adjacent sites and utilities.

§ 10.2.4 When use or storage of explosives or other hazardous materials or equipment or unusual
methods are necessary for execution of the Work, the Contractor shall exercise utmost care and
carry on such activities under supervision of properly qualified personnel.

§ 10.2.5 The Contractor shall promptly remedy damage and loss (other than damage or loss insured
under property insurance required by the Contract Documents) to property referred to in Sections
10.2.1.2 and 10.2.1.3 caused in whole or in part by the Contractor, a Subcontractor, a
Sub-subcontractor, or anyone directly or indirectly employed by any of them, or by anyone for whose
acts they may be liable and for which the Contractor is responsible under Sections 10.2.1.2 and
10.2.1.3, except damage or loss attributable to acts or omissions of the Owner or Architect or
anyone directly or indirectly employed by either of them, or by anyone for whose acts either of
them may be liable, and not attributable to the fault or negligence of the Contractor. The
foregoing obligations of the Contractor are in addition to the Contractor’s obligations under
Section 3.18.

§ 10.2.6 The Contractor shall designate a responsible member of the Contractor’s organization at
the site whose duty shall be the prevention of accidents. This person shall be the Contractor’s
superintendent unless otherwise designated by the Contractor in writing to the Owner and Architect.

§ 10.2.7 The Contractor shall not load or permit any part of the construction or site to be loaded
so as to endanger its safety.

§10.2.8 Unless escorted by Contractor, the Owner will be responsible for the physical safety of any
real estate sales people, prospective purchaser, prospective tenant, or other person invited or
permitted by the Owner to enter the jobsite. The Jobsite Safety Program is not designed for
non-construction personnel.

§ 10.3 HAZARDOUS MATERIALS

§ 10.3.1 If reasonable precautions will be inadequate to prevent foreseeable bodily injury or death
to persons resulting from a material or substance, including but not limited to asbestos or
polychlorinated biphenyl (PCB), encountered on the site by the Contractor, the Contractor shall,
upon recognizing the condition, immediately stop Work in the affected area and report the condition
to the Owner and Architect in writing.

§ 10.3.2 The Owner shall obtain the services of a licensed laboratory to verify the presence or
absence of the material or substance reported by the Contractor and, in the event such material or
substance is found to be present, to verify that it has been rendered harmless. Unless otherwise
required by the Contract Documents, the Owner shall furnish in writing to the Contractor the names
and qualifications of persons or entities who are to perform tests verifying the presence or
absence of such material or substance or who are to perform the task of removal or safe containment
of such material or substance. The Contractor will promptly reply to the Owner in writing stating
whether or not it has reasonable objection to the persons or entities proposed by the Owner. If
the Contractor has an objection to a person or entity proposed by the Owner, the Owner shall
propose another to whom the Contractor has no reasonable objection. When the material or substance
has been rendered harmless, Work in the affected area shall resume upon written agreement of the
Owner and Contractor. The Contract Time shall be extended appropriately and the Contract Sum shall
be increased in the amount of the Contractor’s reasonable additional costs of shut-down, delay and
start-up, which adjustments shall be accomplished as provided in Article 7.

§ 10.3.3 To the fullest extent permitted by law, the Owner shall indemnify and hold harmless the
Contractor, Subcontractors, and agents and employees of any of them from and against claims,
damages, losses and expenses, including but not limited to attorneys’ fees, arising out of or
resulting from performance of the Work in the affected area if in fact the material or substance
presents the risk of bodily injury or death as described in Section 10.3.1 and has not been
rendered harmless, provided that such claim, damage, loss or expense is attributable to bodily
injury, sickness, disease or death, or to injury to or destruction of tangible property (other than
the Work itself) and provided that such damage, loss or expense is not due primarily to the gross
negligence of a party seeking indemnity.

§ 10.4 The Owner shall not be responsible under Section 10.3 for materials and substances brought
to the site by the Contractor unless such materials or substances were required by the Contract
Documents.

§ 10.5 If, without negligence on the part of the Contractor, the Contractor is held liable for the
cost of remediation of a hazardous material or substance solely by reason of performing Work as
required by the Contract Documents, the Owner shall indemnify the Contractor for all cost and
expense thereby incurred.

§ 10.6 EMERGENCIES

§ 10.6.1 In an emergency affecting safety of persons or property, the Contractor shall act, at the
Contractor’s discretion, to prevent threatened damage, injury or loss. Additional compensation or
extension of time claimed by the Contractor on account of an emergency shall be determined as
provided in Section 4.3 and Article 7.

ARTICLE 11 INSURANCE AND BONDS

§ 11.1 CONTRACTOR’S LIABILITY INSURANCE

§ 11.1.1 The Contractor shall purchase from and maintain in a company or companies lawfully
authorized to do business in the jurisdiction in which the Project is located such insurance as
will protect the Contractor from claims set forth below which may arise out of or result from the
Contractor’s operations under the Contract and for which the Contractor may be legally liable,
whether such operations be by the Contractor or by a Subcontractor or by anyone directly or
indirectly employed by any of them, or by anyone for whose acts any of them may be liable:

	 	.1	 	claims under workers’ compensation, disability benefit and other similar
employee benefit acts which are applicable to the Work to be performed;

	 	.2	 	claims for damages because of bodily injury, occupational sickness or disease,
or death of the Contractor’s employees;

	 	.3	 	claims for damages because of bodily injury, sickness or disease, or death of
any person other than the Contractor’s employees;

	 	.4	 	claims for damages insured by usual personal injury liability coverage;

	 	.5	 	claims for damages, other than to the Work itself, because of injury to or
destruction of tangible property, including loss of use resulting therefrom;

	 	.6	 	claims for damages because of bodily injury, death of a person or property
damage arising out of ownership, maintenance or use of a motor vehicle;

	 	.7	 	claims for bodily injury or property damage arising out of completed
operations; and

	 	.8	 	claims involving contractual liability insurance applicable to the Contractor’s
obligations under Section 3.18.

§ 11.1.2 The insurance required by Section 11.1.1 shall be written for not less than limits of
liability specified in the Contract Documents or required by law, whichever coverage is greater.
Coverages shall be on an occurrence basis, except to the extent permitted to be on a claims-made
basis per Exhibit “E”, and shall be maintained without interruption from date of commencement of
the Work until date of final payment and termination of any coverage required to be maintained
after final payment.

11.1.2.1 Contractor shall require its Subcontractors to maintain insurance as listed in
Exhibit “E”.

§ 11.1.3 Certificates of insurance acceptable to the Owner shall be filed with the Owner prior to
commencement of the Work. These certificates and the insurance policies required by this Section
11.1 shall contain a provision that coverages afforded under the policies will not be canceled or
allowed to expire until at least 30 days’ prior written notice has been given to the Owner. If any
of the foregoing insurance coverages are required to remain in force after final payment and are
reasonably available, an additional certificate evidencing continuation of such coverage shall be
submitted with the final Application for Payment as required by Section 9.10.2. Information
concerning reduction of coverage on account of revised limits or claims paid under the General
Aggregate, or both, shall be furnished by the Contractor with reasonable promptness in accordance
with the Contractor’s information and belief.

§ 11.1.4 The Contractor will name the Owner as an additional insured on its general liability
policy. The Owner will name the Contractor as an additional insured on the Owner’s general
liability policy only for non-construction related claims. Any additional premium cost incurred by
the Contractor for naming the Owner as an additional insured will be treated as a part of the Cost
of the Work under Article 7 of the Agreement.

§ 11.2 OWNER’S LIABILITY INSURANCE

§ 11.2.1 The Owner shall be responsible for purchasing and maintaining the Owner’s usual liability
insurance.

§ 11.4 PROPERTY INSURANCE

§ 11.4.1 Unless otherwise provided, the Owner shall purchase and maintain, in a company or
companies lawfully authorized to do business in the jurisdiction in which the Project is located,
property insurance written on a builder’s risk “all-risk” or equivalent policy form in the amount
of the initial Contract Sum, plus value of subsequent Contract modifications and cost of materials
supplied or installed by others, comprising total value for the entire Project at the site on a
replacement cost basis. Such property insurance shall be maintained, unless otherwise provided in
the Contract Documents or otherwise agreed in writing by all persons and entities who are
beneficiaries of such insurance, until final payment has been made as provided in Section 9.10 or
until no person or entity other than the Owner has an insurable interest in the property required
by this Section 11.4 to be covered, whichever is later. This insurance shall include interests of
the Owner, the Contractor, Subcontractors and Sub-subcontractors in the Project.

§ 11.4.1.1 Property insurance shall be on an “all-risk” or equivalent policy form and shall
include, without limitation, insurance against the perils of fire (with extended coverage) and
physical loss or damage including, without duplication of coverage, theft, vandalism, malicious
mischief, collapse, windstorm, testing and startup, temporary buildings and debris removal
including demolition occasioned by enforcement of any applicable legal requirements, and shall
cover reasonable compensation for Architect’s and Contractor’s services and expenses required as a
result of such insured loss.

§ 11.4.1.2 If the Owner does not intend to purchase such property insurance required by the
Contract and with all of the coverages in the amount described above, the Owner shall so inform the
Contractor in writing prior to commencement of the Work. The Contractor may then effect insurance
which will protect the interests of the Contractor, Subcontractors and Sub-subcontractors in the
Work, and by appropriate Change Order the cost thereof shall be charged to the Owner. If the
Contractor is damaged by the failure or neglect of the Owner to purchase or maintain insurance as
described above, without so notifying the Contractor in writing, then the Owner shall bear all
reasonable costs properly attributable thereto.

§ 11.4.1.3 If the property insurance requires deductibles, the Owner shall pay costs not covered
because of such deductibles.

§ 11.4.1.4 This property insurance shall cover portions of the Work stored off the site, and also
portions of the Work in transit.

§ 11.4.1.5 Partial occupancy or use in accordance with Section 9.9 shall not commence until the
insurance company or companies providing property insurance have consented to such partial
occupancy or use by endorsement or otherwise. The Owner and the Contractor shall take reasonable
steps to obtain consent of the insurance company or companies and shall, without mutual written
consent, take no action with respect to partial occupancy or use that would cause cancellation,
lapse or reduction of insurance.

§ 11.4.3 Loss of Use Insurance. The Owner, at the Owner’s option, may purchase and maintain such
insurance as will insure the Owner against loss of use of the Owner’s property due to fire or other
hazards, however caused. The Owner waives all rights of action against the Contractor for loss of
use of the Owner’s property, including consequential losses due to fire or other hazards however
caused.

§ 11.4.4 If the Contractor requests in writing that insurance for risks other than those described
herein or other special causes of loss be included in the property insurance policy, the Owner
shall, if possible, include such insurance, and the cost thereof shall be charged to the Contractor
by appropriate Change Order.

§ 11.4.5 If during the Project construction period the Owner insures properties, real or personal
or both, at or adjacent to the site by property insurance under policies separate from those
insuring the Project, or if after final payment property insurance is to be provided on the
completed Project through a policy or policies other than those insuring the Project during the
construction period, the Owner shall waive all rights in accordance with the terms of Section
11.4.7 for damages caused by fire or other causes of loss covered by this separate property
insurance. All separate policies shall provide this waiver of subrogation by endorsement or
otherwise.

§ 11.4.6 Before an exposure to loss may occur, the Owner shall file with the Contractor a copy of
each policy that includes insurance coverages required by this Section 11.4. Each policy shall
contain all generally applicable conditions, definitions, exclusions and endorsements related to
this Project. Each policy shall contain a provision that the policy will not be canceled or allowed
to expire, and that its limits will not be reduced, until at least 30 days’ prior written notice
has been given to the Contractor.

§ 11.4.7 Waivers of Subrogation. The Owner and Contractor waive all rights against (1) each other
and any of their subcontractors, sub-subcontractors, agents and employees, each of the other, and
(2) the Architect, Architect’s consultants, separate contractors described in Article 6, if any,
and any of their subcontractors, sub-subcontractors, agents and employees, for damages caused by
fire or other causes of loss intended to be covered by property insurance obtained pursuant to this
Section 11.4 or other property insurance applicable to the Work, except such rights as they have to
proceeds of such insurance held by the Owner as fiduciary. The Owner or Contractor, as appropriate,
shall require of the Architect, Architect’s consultants, separate contractors described in Article
6, if any, and the subcontractors, sub-subcontractors, agents and employees of any of them, by
appropriate agreements, written where legally required for validity, similar waivers each in favor
of other parties enumerated herein. The policies shall provide such waivers of subrogation by
endorsement or otherwise. A waiver of subrogation shall be effective as to a person or entity even
though that person or entity would otherwise have a duty of indemnification, contractual or
otherwise, did not pay the insurance premium directly or indirectly, and whether or not the person
or entity had an insurable interest in the property damaged.

§ 11.4.8 A loss insured under Owner’s property insurance shall be adjusted by the Owner as
fiduciary and made payable to the Owner as fiduciary for the insureds, as their interests may
appear, subject to requirements of any applicable mortgagee clause and of Section 11.4.10. The
Contractor shall pay Subcontractors their just shares of insurance proceeds received by the
Contractor, and by appropriate agreements, written where legally required for validity, shall
require Subcontractors to make payments to their Sub-subcontractors in similar manner.

§ 11.4.9 If required in writing by a party in interest, the Owner as fiduciary shall, upon
occurrence of an insured loss, give bond for proper performance of the Owner’s duties. The cost of
required bonds shall be charged against proceeds received as fiduciary. The Owner shall deposit in
a separate account proceeds so received, which the Owner shall distribute in accordance with such
agreement as the parties in interest may reach, or in accordance with an arbitration award in which
case the procedure shall be as provided in Section 4.6. If after such loss no other special
agreement is made and unless the Owner terminates the Contract for convenience, replacement of
damaged property shall be performed by the Contractor after notification of a Change in the Work in
accordance with Article 7.

§ 11.4.10 The Owner as fiduciary shall have power to adjust and settle a loss with insurers unless
one of the parties in interest shall object in writing within five days after occurrence of loss to
the Owner’s exercise of this power; if such objection is made, the dispute shall be resolved as
provided in Sections 4.5 and 4.6. The Owner as fiduciary shall, in the case of arbitration, make
settlement with insurers in accordance with directions of the arbitrators. If distribution of
insurance proceeds by arbitration is required, the arbitrators will direct such distribution.

§ 11.4.11 The Owner shall name the Contractor as a named insured on its fire, and/or Builders Risk
Insurance coverage. Regardless of whether or not earthquake or flood insurance is provided,
Contractor assumes no liability for damage to the Project caused by these perils. In addition,
Contractor assumes no liability for subsidence not caused by Contractor or any of its
subcontractors.

§ 11.5 PERFORMANCE BOND AND PAYMENT BOND

§ 11.5.1 The Owner shall have the right to require the Contractor to furnish bonds covering
faithful performance of the Contract and payment of obligations arising thereunder as stipulated in
bidding requirements or specifically required in the Contract Documents on the date of execution of
the Contract.

§ 11.5.2 Upon the request of any person or entity appearing to be a potential beneficiary of bonds
covering payment of obligations arising under the Contract, the Contractor shall promptly furnish a
copy of the bonds or shall permit a copy to be made.

§ 11.6 The Owner shall deliver to the Contractor such evidence, as the Contractor may reasonably
request, of errors and omissions insurance covering the Architect and the soils, civil, structural,
mechanical, plumbing and electrical engineers for the Project.

ARTICLE 12 UNCOVERING AND CORRECTION OF WORK

§ 12.1 UNCOVERING OF WORK

§ 12.1.1 If a portion of the Work is covered contrary to the Architect’s request or to requirements
specifically expressed in the Contract Documents, it must, if required in writing by the Architect,
be uncovered for the Architect’s examination and be replaced at the Contractor’s expense without
change in the Contract Time.

§ 12.1.2 If a portion of the Work has been covered which the Architect has not specifically
requested to examine prior to its being covered, the Architect may request to see such Work and it
shall be uncovered by the Contractor. If such Work is in accordance with the Contract Documents,
costs of uncovering and replacement shall, by appropriate Change Order, be at the Owner’s expense.
If such Work is not in accordance with the Contract Documents, correction shall be at the
Contractor’s expense unless the condition was caused by the Owner or a separate contractor in which
event the Owner shall be responsible for payment of such costs.

§ 12.2 CORRECTION OF WORK

§ 12.2.1 BEFORE OR AFTER SUBSTANTIAL COMPLETION

§ 12.2.1.1 The Contractor shall promptly correct Work rejected by the Architect or failing to
conform to the requirements of the Contract Documents, whether discovered before or after
Substantial Completion and whether or not fabricated, installed or completed. Costs of correcting
such rejected Work, including additional testing and inspections and compensation for the
Architect’s services and expenses made necessary thereby, shall be at the Contractor’s expense.

§ 12.2.2 AFTER SUBSTANTIAL COMPLETION

§ 12.2.2.1 In addition to the Contractor’s obligations under Section 3.5, if, within one year after
the date of Substantial Completion of the Work or designated portion thereof or after the date for
commencement of warranties established under Section 9.9.1, or by terms of an applicable special
warranty required by the Contract Documents, any of the Work is found to be not in accordance with
the requirements of the Contract Documents, the Contractor shall correct it promptly after receipt
of written notice from the Owner to do so unless the Owner has previously given the Contractor a
written acceptance of such condition. The Owner shall give such notice promptly after discovery of
the condition. During the one-year period for correction of Work, if the Owner fails to notify the
Contractor and give the Contractor an opportunity to make the correction, the Owner waives the
rights to require correction by the Contractor; Owner, however, may still make a claim for Breach
of Warranty within the applicable period of limitations. If the Contractor fails to correct
nonconforming Work within a reasonable time during that period after receipt of notice from the
Owner or Architect, the Owner may correct it in accordance with Section 2.4.

§ 12.2.2.2 The one-year period for correction of Work shall be extended with respect to portions of
Work first performed after Substantial Completion by the period of time between Substantial
Completion and the actual performance of the Work.

§ 12.2.2.3 The one-year period for correction of Work shall not be extended by corrective Work
performed by the Contractor pursuant to this Section 12.2.

§ 12.2.3 The Contractor shall remove from the site portions of the Work which are not in accordance
with the requirements of the Contract Documents and are neither corrected by the Contractor nor
accepted by the Owner.

§ 12.2.4 The Contractor shall bear the cost of correcting destroyed or damaged construction,
whether completed or partially completed, of the Owner or separate contractors caused by the
Contractor’s correction or removal of Work which is not in accordance with the requirements of the
Contract Documents.

§ 12.2.5 Nothing contained in this Section 12.2 shall be construed to establish a period of
limitation with respect to other obligations which the Contractor might have under the Contract
Documents. Establishment of the one-year period for correction of Work as described in Section
12.2.2 relates only to the specific obligation of the Contractor to correct the Work, and has no
relationship to the time within which the obligation to comply with the Contract Documents may be
sought to be enforced, nor to the time within which proceedings may be commenced to establish the
Contractor’s liability with respect to the Contractor’s obligations other than specifically to
correct the Work.

§ 12.3 ACCEPTANCE OF NONCONFORMING WORK

§ 12.3.1 If the Owner prefers to accept Work which is not in accordance with the requirements of
the Contract Documents, the Owner may do so instead of requiring its removal and correction, in
which case the Contract Sum will be reduced as appropriate and equitable. Such adjustment shall be
effected whether or not final payment has been made.

ARTICLE 13 MISCELLANEOUS PROVISIONS

§ 13.1 GOVERNING LAW

§ 13.1.1 The Contract shall be governed by the law of the place where the Project is located.

§ 13.2 SUCCESSORS AND ASSIGNS

§ 13.2.1 The Owner and Contractor respectively bind themselves, their partners, successors, assigns
and legal representatives to the other party hereto and to partners, successors, assigns and legal
representatives of such other party in respect to covenants, agreements and obligations contained
in the Contract Documents. Except as provided in Section 13.2.2, neither party to the Contract
shall assign the Contract as a whole without written consent of the other. If either party attempts
to make such an assignment without such consent, that party shall nevertheless remain legally
responsible for all obligations under the Contract.

§ 13.2.2 The Owner may, without consent of the Contractor, assign the Contract to an institutional
lender providing construction financing for the Project. In such event, the lender shall assume the
Owner’s rights and obligations under the Contract Documents. The Contractor shall execute all
consents reasonably required to facilitate such assignment.

§ 13.3 WRITTEN NOTICE

§ 13.3.1 Written notice shall be deemed to have been duly served if delivered in person to the
individual or a member of the firm or entity or to an officer of the corporation for which it was
intended, or if delivered at or sent by registered or certified mail to the last business address
known to the party giving notice.

§ 13.4 RIGHTS AND REMEDIES

§ 13.4.1 Duties and obligations imposed by the Contract Documents and rights and remedies available
thereunder shall be in addition to and not a limitation of duties, obligations, rights and remedies
otherwise imposed or available by law.

§ 13.4.2 No action or failure to act by the Owner, Architect or Contractor shall constitute a
waiver of a right or duty afforded them under the Contract, nor shall such action or failure to act
constitute approval of or acquiescence in a breach thereunder, except as may be specifically agreed
in writing.

§ 13.4.3 Notwithstanding references herein to the Architect, Subcontractors, other contractors or
other persons or entities, such persons or entities are not third party beneficiaries of this
Agreement. There are no third party beneficiaries of this Agreement. This Agreement may be
enforced only by the Owner, its permitted assignees (such as its lender) and Contractor.

§ 13.5 TESTS AND INSPECTIONS

§ 13.5.1 Tests, inspections and approvals of portions of the Work required by the Contract
Documents or by laws, ordinances, rules, regulations or orders of public authorities having
jurisdiction shall be made at an appropriate time. Unless otherwise provided, the Contractor shall
make arrangements for such tests, inspections and approvals with an independent testing laboratory
or entity acceptable to the Owner, or with the appropriate public authority . The Contractor shall
give the Architect timely notice of when and where tests and inspections are to be made so that the
Architect may be present for such procedures. The Owner shall bear costs of tests, inspections or
approvals.

§ 13.5.2 If the Architect, Owner or public authorities having jurisdiction determine that portions
of the Work require additional testing, inspection or approval not included under Section 13.5.1,
the Architect will, upon written authorization from the Owner, instruct the Contractor to make
arrangements for such additional testing, inspection or approval by an entity acceptable to the
Owner, and the Contractor shall give timely notice to the Architect of when and where tests and
inspections are to be made so that the Architect may be present for such procedures. Such costs,
except as provided in Section 13.5.3, shall be at the Owner’s expense.

§ 13.5.3 If such procedures for testing, inspection or approval under Sections 13.5.1 and 13.5.2
reveal failure of the portions of the Work to comply with requirements established by the Contract
Documents, all costs made necessary by such failure including those of repeated procedures and
compensation for the Architect’s services and expenses shall be at the Contractor’s expense.

§ 13.5.4 Required certificates of testing, inspection or approval shall, unless otherwise required
by the Contract Documents, be secured by the Contractor and promptly delivered to the Architect.

§ 13.5.5 If the Architect is to observe tests, inspections or approvals required by the Contract
Documents, the Architect will do so promptly and, where practicable, at the normal place of
testing.

§ 13.5.6 Tests or inspections conducted pursuant to the Contract Documents shall be made promptly
to avoid unreasonable delay in the Work.

§ 13.6 INTEREST

§ 13.6.1 Payments due and unpaid under the Contract Documents shall bear interest from the date
payment is due at such rate as the parties may agree upon in writing or, in the absence thereof, at
the legal rate prevailing from time to time at the place where the Project is located.

§ 13.7 COMMENCEMENT OF STATUTORY LIMITATION PERIOD

§ 13.7.1 Causes of Action between the parties to this Agreement pertaining to acts or failure to
act shall be deemed to have accrued and the applicable statute of limitations shall commence to run
as provided under applicable laws.

ARTICLE 14 TERMINATION OR SUSPENSION OF THE CONTRACT

§ 14.1 TERMINATION BY THE CONTRACTOR

§ 14.1.1 The Contractor may terminate the Contract if the Work is stopped for a period of 45
consecutive days through no act or fault of the Contractor or a Subcontractor, Sub-subcontractor or
their agents or employees or any other persons or entities performing portions of the Work under
direct or indirect contract with the Contractor, for any of the following reasons:

	 	.1	 	issuance of an order of a court or other public authority having jurisdiction
which requires all Work to be stopped;

	 	.2	 	an act of government, such as a declaration of national emergency which
requires all Work to be stopped;

	 	.3	 	because the Architect has not issued a Certificate for Payment and has not
notified the Contractor of the reason for withholding certification as provided in
Section 9.4.1, or because the Owner has not made payment on a Certificate for Payment
within the time stated in the Contract Documents; or

	 	.4	 	the Owner has failed to furnish to the Contractor promptly, upon the
Contractor’s request, reasonable evidence as required by Section 2.2.1.

.5 the Project is materially damaged or destroyed by the occurrences listed in Article
11.4.1.1.

§ 14.1.2 The Contractor may terminate the Contract if, through no act or fault of the Contractor or
a Subcontractor, Sub-subcontractor or their agents or employees or any other persons or entities
performing portions of the Work under direct or indirect contract with the Contractor, repeated
suspensions, delays or interruptions of the entire Work by the Owner as described in Section 14.3
constitute in the aggregate more than 100 percent of the total number of days scheduled for
completion, or 120 days in any 365-day period, whichever is less.

§ 14.1.3 If one of the reasons described in Section 14.1.1 or 14.1.2 exists, the Contractor may,
upon seven days’ written notice to the Owner and Architect, terminate the Contract and recover from
the Owner payment for Work executed      , and costs incurred by reason of such termination, along with
reasonable overhead and profit on the work executed.

§ 14.1.4 If the Work is stopped for a period of 60 consecutive days through no act or fault of the
Contractor or a Subcontractor or their agents or employees or any other persons performing portions
of the Work under contract with the Contractor because the Owner has persistently failed to fulfill
the Owner’s obligations under the Contract Documents with respect to matters important to the
progress of the Work, the Contractor may, upon seven additional days’ written notice to the Owner
and the Architect, terminate the Contract and recover from the Owner as provided in Section 14.1.3.

§ 14.2 TERMINATION BY THE OWNER FOR CAUSE

§ 14.2.1 The Owner may terminate the Contract if the Contractor:

	 	.1	 	persistently or repeatedly refuses or fails to supply enough properly skilled
workers or proper materials;

	 	.2	 	fails to make payment to Subcontractors for materials or labor in accordance
with the respective agreements between the Contractor and the Subcontractors;

	 	.3	 	persistently disregards laws, ordinances, or rules, regulations or orders of a
public authority having jurisdiction; or

	 	.4	 	otherwise is guilty of substantial breach of a provision of the Contract
Documents.

§ 14.2.2 When any of the above reasons exist, the Owner, upon certification by the Architect that
sufficient cause exists to justify such action, may without prejudice to any other rights or
remedies of the Owner and after giving the Contractor and the Contractor’s surety, if any, seven
days’ written notice, terminate employment of the Contractor and may, subject to any prior rights
of the surety:

	 	.1	 	take possession of the site:

	 	.2	 	accept assignment of subcontracts pursuant to Section 5.4; and

	 	.3	 	finish the Work by whatever reasonable method the Owner may deem expedient.
Upon request of the Contractor, the Owner shall furnish to the Contractor a detailed
accounting of the costs incurred by the Owner in finishing the Work.

§ 14.2.3 When the Owner terminates the Contract for one of the reasons stated in Section 14.2.1,
the Contractor shall not be entitled to receive further payment until the Work is finished.

§ 14.2.4 If the unpaid balance of the Contract Sum exceeds costs of finishing the Work, including
compensation for the Architect’s services and expenses made necessary thereby, and other damages
incurred by the Owner and not expressly waived, such excess shall be paid to the Contractor. If
such costs and damages exceed the unpaid balance, the Contractor shall pay the difference to the
Owner. The amount to be paid to the Contractor or Owner, as the case may be, shall be certified by
the Architect, upon application, and this obligation for payment shall survive termination of the
Contract.

§ 14.3 SUSPENSION BY THE OWNER FOR CONVENIENCE

§ 14.3.1 The Owner may, without cause, order the Contractor in writing to suspend, delay or
interrupt the Work in whole or in part for such period of time as the Owner may determine.

§ 14.3.2 The Contract Sum and Contract Time shall be adjusted for increases in the cost and time
caused by suspension, delay or interruption as described in Section 14.3.1. Adjustment of the
Contract Sum shall include profit. No adjustment shall be made to the extent:

	 	.1	 	that performance is, was or would have been so suspended, delayed or
interrupted by another cause for which the Contractor is responsible; or

	 	.2	 	that an equitable adjustment is made or denied under another provision of the
Contract.

§ 14.4 TERMINATION BY THE OWNER FOR CONVENIENCE

§ 14.4.1 The Owner may, at any time, terminate the Contract for the Owner’s convenience and without
cause.

§ 14.4.2 Upon receipt of written notice from the Owner of such termination for the Owner’s
convenience, the Contractor shall:

	 	.1	 	cease operations as directed by the Owner in the notice;

	 	.2	 	take actions necessary, or that the Owner may direct, for the protection and
preservation of the Work; and

	 	.3	 	except for Work directed to be performed prior to the effective date of
termination stated in the notice, terminate all existing subcontracts and purchase
orders and enter into no further subcontracts and purchase orders.

§ 14.4.3 In case of such termination for the Owner’s convenience, the Contractor shall be entitled
to receive payment for Work executed, and costs incurred by reason of such termination, along with
reasonable overhead and profit on the Work executed.

4REGISTRATION RIGHTS AGREEMENT

        REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
August 9, 2005, by and between Vital Products, Inc. a company organized
under the laws of State of Delaware, with its principal executive office at
35 Adesso Drive Concord, ON, L4K 3C7, Canada (the "Company"), and
Dutchess Private Equities Fund, II, L.P. (the "Investor").

        WHEREAS, in connection with the Investment Agreement by and between
the Company and the Investor of even date herewith (the "Investment
Agreement"), the Company has agreed to issue and sell to the Investor (i)
40,000,000 shares of the Company's common stock, .0001 par
value per share (the "Common Stock"), to be purchased pursuant to the terms
and subject to the conditions set forth in the Investment Agreement; and

        WHEREAS, to induce the Investor to execute and deliver the Investment
Agreement, the Company has agreed to provide certain registration rights under
the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute (collectively, the "1933 Act"),
and applicable state securities laws, with respect to the shares of Common
Stock issuable pursuant to the Investment Agreement.

        NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants contained hereinafter and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Company and the Investor hereby agree as follows:

1.       DEFINITIONS.

        As used in this Agreement, the following terms shall have the following
        meanings:

a.  "Execution Date" means the date this Agreement and the Investment Agreement
are signed by the Company and the Investor.

b.  "Holder" means Dutchess Private Equities Fund, II, L.P., a Delaware limited
partnership.

c.   "Person" means a corporation, a limited liability company, an association,
a partnership, an organization, a business, an individual, a governmental or
political subdivision thereof or a governmental agency.

d. "Potential Material Event" means any of the following: (i) the possession
by the Company of material information not ripe for disclosure in a
Registration Statement, which shall be evidenced by determinations in good
faith by the Board of Directors of the Company that disclosure of such
information in the Registration Statement would be detrimental to the business
and affairs of the Company, or (ii) any material engagement or activity by
the Company which would, in the good faith determination of the Board of
Directors of the Company, be adversely affected by disclosure in a Registration
Statement at such time, which determination shall be accompanied by a good
faith determination by the Board of Directors of the Company that the
Registration Statement would be materially misleading absent the inclusion
of such information.

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e.  "Principal Market" shall mean The American Stock Exchange, National
Association of Securities Dealer's, Inc., Pink Sheets, OTC electronic bulletin
board, the Nasdaq National Market or The Nasdaq SmallCap Market whichever is
the principal market on which the Common Stock is listed.

f.  "Register," "Registered," and "Registration" refer to a registration
effected by preparing and filing one or more Registration Statements in
compliance with the 1933 Act and pursuant to Rule 415 under the 1933 Act or
any successor rule providing for offering securities on a continuous basis
("Rule 415"), and the declaration or ordering of effectiveness of such
Registration Statement(s) by the United States Securities and Exchange
Commission (the "SEC").

g.  "Registrable Securities" means (i) the shares of Common Stock issued or
issuable pursuant to the Investment Agreement, and (ii) any shares of capital
stock issued or issuable with respect to such shares of Common Stock, if any,
as a result of any stock split, stock dividend, recapitalization, exchange or
similar event or otherwise, which have not been (x) included in a Registration
Statement that has been declared effective by the SEC or (y) sold under
circumstances meeting all of the applicable conditions of Rule 144 (or any
similar provision then in force) under the 1933 Act.

h.  "Registration Statement" means a registration statement of the Company
filed under the 1933 Act.

All capitalized terms used in this Agreement and not otherwise defined herein
shall have the same meaning ascribed to them as in the Investment Agreement.

        2.      REGISTRATION.

a.      Mandatory Registration. On or before the execution of this Agreement,
the Company shall have  a draft of the Registration Statement covering the
underlying shares of the Company's stock of the equity line investment and
Commitment Shares. The Company shall, as soon as practicable file, but not later
than fifteen (15) calendar days following the Execution Date,  with the SEC a
Registration Statement or Registration Statements (as is necessary) on Form SB-2
(or, if such form is unavailable for such a registration, on such other form as
is available for such a registration), covering the resale of all of the
Registrable Securities, which Registration Statement(s) shall state that, in
accordance with Rule 416 promulgated under the 1933 Act, such Registration
Statement also covers such indeterminate number of additional shares of Common
Stock as may become issuable upon stock splits, stock dividends or similar
transactions. The Company shall initially register for resale 40,000,000 shares
of Common Stock which would be issuable on the date preceding the filing of the
Registration Statement based on the closing bid price of the Company's Common
Stock on such date and the amount reasonably calculated that represents Common
Stock issuable to other parties as set forth in the Investment Agreement except
to the extent that the SEC requires the share amount to be reduced as a
condition to effectiveness.

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b.      The Company shall use its best efforts to have the Registration
Statement(s) declared effective by the SEC within ninety (90) calendar days
after the Execution Date.

c.      Counsel.  Subject to Section 5 hereof, in connection with any offering
of the Registrable Securities pursuant to this Section 2, the Holder shall have
the right to select legal counsel to administer its interests in the offering.
The Company shall reasonably cooperate with any such counsel.

        3.      RELATED OBLIGATIONS.

        At such time as the Company is obligated to prepare and file a
Registration Statement with the SEC pursuant to Section 2(a), the Company will
use its best efforts to effect the registration of the Registrable Securities
in accordance with the intended method of disposition thereof and, with respect
thereto, the Company shall have the following obligations:

a.      The Company shall use its best efforts to cause such Registration
Statement relating to the Registrable Securities to become effective within
ninety (90) days after the Execution Date and shall keep such Registration
Statement effective until the earlier to occur of (i) the date as of which
the Holders may sell all of the Registrable Securities without restriction
pursuant to Rule 144(k) promulgated under the 1933 Act (or successor thereto)
or (ii) the date on which (A) the Holders shall have sold all the Registrable
Securities and (B) the Investor has no right to acquire any additional shares
of Common Stock under the Investment Agreement respectively (the "Registration
Period"), which Registration Statement (including any amendments or supplements
thereto and prospectuses contained therein) shall not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein, or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading. The Company shall
respond to all SEC comments within seven (7) business days from receipt of
such comments by the Company. The Company shall cause the Registration
Statement relating to the Registrable Securities to become effective no later
than three (3) business days after notice from the SEC that the Registration
Statement may be declared effective.  In order to achieve the foregoing
objectives, the Holder agrees to provide all information necessary to complete
the registration statement, including the intended method of disposition of
the Registrable Securities, and the Company's obligations set forth above
shall be conditioned on the receipt of such information.

b.      The Company shall prepare and file with the SEC such amendments
(including post-effective amendments) and supplements to a Registration
Statement and the prospectus used in connection with such Registration
Statement, which prospectus is to be filed pursuant to Rule 424 promulgated
under the 1933 Act, as may be necessary to keep such Registration Statement
effective during the Registration Period, and, during such period, comply
with the provisions of the 1933 Act with respect to the disposition of all

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Registrable Securities of the Company covered by such Registration Statement
until such time as all of such Registrable Securities shall have been
disposed of in accordance with the intended methods of disposition by the
Investor thereof as set forth in such Registration Statement.  In the event
the number of shares of Common Stock available under a Registration Statement
filed pursuant to this Agreement is at any time insufficient to cover all of
the Registrable Securities, the Company shall amend such Registration
Statement, or file a new Registration Statement (on the short form available
therefor, if applicable), or both, so as to cover all of the Registrable
Securities, in each case, as soon as practicable, but in any event within
thirty (30) calendar days after the necessity therefor arises (based on the
then Purchase Price of the Common Stock and other relevant factors on which
the Company reasonably elects to rely), assuming the Company has sufficient
authorized shares at that time, and if it does not, within thirty (30)
calendar days after such shares are authorized.  The Company shall use it
best efforts to cause such amendment and/or new Registration Statement to
become effective as soon as practicable following the filing thereof.

c       The Company shall make available to the Holders whose Registrable
Securities are included in any Registration Statement and its legal counsel
without charge (i) promptly after the same is prepared and filed with the SEC
at least one copy of such Registration Statement and any amendment(s) thereto,
including financial statements and schedules, all documents incorporated
therein by reference and all exhibits, the prospectus included in such
Registration Statement (including each preliminary prospectus) and, with
regards to such Registration Statement(s), any correspondence by or on
behalf of the Company to the SEC or the staff of the SEC and any
correspondence from the SEC or the staff of the SEC to the Company or
its representatives, (ii) upon the effectiveness of any Registration
Statement, the Company shall make available copies of the prospectus included
in such Registration Statement and all amendments and supplements thereto and
(iii) such other documents, including copies of any preliminary or final
prospectus, as the Holders may reasonably request from time to time in order
to facilitate the disposition of the Registrable Securities.

d.      The Company shall use reasonable efforts to (i) register and qualify
the Registrable Securities covered by a Registration Statement under such
other securities or "blue sky" laws of such states in the United States as
any Holder reasonably requests, (ii) prepare and file in those jurisdictions,
such amendments (including post-effective amendments) and supplements to such
registrations and qualifications as may be necessary to maintain the
effectiveness thereof during the Registration Period, (iii) take such other
actions as may be necessary to maintain such registrations and qualifications
in effect at all times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable Securities
for sale in such jurisdictions; provided, however, that the Company shall not
be required in connection therewith or as a condition thereto to (x) qualify
to do business in any jurisdiction where it would not otherwise be required to
qualify but for this Section 3(d), (y) subject itself to general taxation in
any such jurisdiction, or (z) file a general consent to service of process in
any such jurisdiction.  The Company shall promptly notify each Holder who holds
Registrable Securities of the receipt by the Company of any notification with
respect to the suspension of the registration or qualification of any of the
Registrable Securities for sale under the securities or "blue sky" laws of any
jurisdiction in the United States or its receipt of actual notice of the
initiation or threatening of any proceeding for such purpose.

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<PAGE>

e.  As promptly as practicable after becoming aware of such event, the Company
shall notify each Holder in writing of the happening of any event as a result
of which the prospectus included in a Registration Statement, as then in
effect, includes an untrue statement of a material fact or omission to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, ("Registration Default") and use all diligent efforts to
promptly prepare a supplement or amendment to such Registration Statement and
take any other necessary steps to cure the Registration Default, (which may
consist of a document to be filed by the Company with the SEC pursuant to
Section 13(a), 13(c), 14 or 15(d) of the 1934 Act (as defined below) and to
be incorporated by reference in the prospectus) to correct such untrue
statement or omission, and make available copies of such supplement or
amendment to each Holder (or such other number of copies as such Holder may
reasonably request). Failure to cure the Registration Default within ten (10)
business days shall result in the Company paying liquidated damages of 2.0% of
the cost of all Common Stock then held by the Holders for each thirty (30)
calendar day period or portion thereof, beginning on the date of suspension.
The Company shall also promptly notify each Holder in writing (i) when a
prospectus or any prospectus supplement or post-effective amendment has been
filed, and when a Registration Statement or any post-effective amendment has
become effective (the Company will prepare a notification of such
effectiveness shall be delivered to each Holder by facsimile on the same
day of such effectiveness and by overnight mail), additionally the Company
will provide a copy of the effectiveness order prepared by the EC when received
by the Company (ii) of any request by the SEC for amendments or supplements
to a Registration Statement or related prospectus or related information,
(iii) of the Company's reasonable determination that a post-effective
amendment to a Registration Statement would be appropriate, (iv) in the event
the Registration Statement is no longer effective or, (v) the Registration
Statement is stale for a period of more than five (5) Trading Days as a
result of the Company's failure to timely file its financials.

The Company acknowledges that its failure to cure the Registration Default
within ten (10) business days will cause the Investor to suffer damages in
an amount that will be difficult to ascertain.  Accordingly, the parties agree
that it is appropriate to include a provision for liquidated damages.  The
parties acknowledge and agree that the liquidated damages provision set forth
in this section represents the parties' good faith effort to quantify such
damages and, as such, agree that the form and amount of such liquidated damages
are reasonable and will not constitute a penalty.

It is the intention of the parties that interest payable under any of the terms
of this Agreement shall not exceed the maximum amount permitted under any
applicable law. If a law, which applies to this Agreement which sets the
maximum interest amount, is finally interpreted so that the interest in
connection with this Agreement exceeds the permitted limits, then: (1) any
such interest shall be reduced by the amount necessary to reduce the interest
to the permitted limit; and (2) any sums already collected (if any) from the
Company which exceed the permitted limits will be refunded to the Company.
The Investor may choose to make this refund by reducing the amount that the
Company owes under this Agreement or by making a direct payment to the Company.
If a refund reduces the amount that the Company owes the Investor, the
reduction will be treated as a partial payment.  In case any provision of
this Agreement is held by a court of competent jurisdiction to be excessive
in scope or otherwise invalid or unenforceable, such provision shall be
adjusted rather than voided, if possible, so that it is enforceable to the
maximum extent possible, and the validity and enforceability of the remaining
provisions of this Agreement will not in any way be affected or impaired
thereby.

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f.  The Company shall use its best efforts to prevent the issuance of any stop
order or other  suspension of effectiveness of a Registration Statement, or
the suspension of the qualification of any of the Registrable Securities for
sale in any jurisdiction and, if such an order or suspension is issued,  to
obtain the withdrawal of such order or suspension at the earliest possible
moment and to notify each Holder who holds Registrable Securities being sold
of the issuance of such order and the  resolution thereof or its receipt of
actual notice of the initiation or threat of any proceeding for such  purpose.

g.      The Company shall permit each Holder and counsel, if the Holder so
desires, designated by the Holder, to review and comment upon a draft
Registration Statement and all amendments and supplements thereto at least
seven (7) business days prior to their filing with the SEC, and not file any
document in a form to which such counsel reasonably objects.  To the extent
that a draft registration statement contains material non-public information,
the Holder will keep the information and not trade on the information.  The
Company shall not submit to the SEC a request for acceleration of the
effectiveness of a Registration Statement or file with the SEC a Registration
Statement or any amendment or supplement thereto without the prior approval of
such counsel or the Holder, which approval shall not be unreasonably withheld.

h.      At the request of any Holder, the Company shall cause to be furnished
to such Holder, on the date of the effectiveness of a Registration Statement,
an opinion, dated as of such date, of counsel representing the Company for
purposes of such Registration Statement.

i.      The Company shall make available for inspection by (i) any Holder and
(ii) one firm of attorneys and one firm of accountants or other agents retained
by the Holders (collectively, the "Inspectors") all pertinent financial and
other records, and pertinent corporate documents and properties of the Company
(collectively, the "Records"), as shall be reasonably deemed necessary by
each Inspector, and cause the Company's officers, directors and employees
to supply all information which any Inspector may reasonably request;
provided, however, that each Inspector shall hold in strict confidence and
shall not make any disclosure (except to a Holder) or use of any Record or
other information which the Company determines in good faith to be
confidential, and of which determination the Inspectors are so notified,
unless (a) the disclosure of such Records is necessary to avoid or correct
a misstatement or omission in any Registration Statement or is otherwise
required under the 1933 Act, (b) the release of such Records is ordered
pursuant to a final, non-appealable subpoena or order from a court or
government body of competent jurisdiction, or (c) the information in such
Records has been made generally available to the public other than by
disclosure in violation of this or any other agreement of which the Inspector
has knowledge.  Each Holder agrees that it shall, upon learning that disclosure
of such Records is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and
allow the Company, at its expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, the Records deemed
confidential.

                                      6
<PAGE>

j.      The Company shall hold in confidence and not make any disclosure of
information concerning a Holder provided to the Company unless (i) disclosure
of such information is necessary to comply with federal or state securities
laws, (ii) the disclosure of such information is necessary to avoid or correct
a misstatement or omission in any Registration Statement, (iii) the release
of such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to
the public other than by disclosure in violation of this Agreement or any
other agreement.  The Company agrees that it shall, upon learning that
disclosure of such information concerning a Holder is sought in or by a court
or governmental body of competent jurisdiction or through other means, give
prompt notice to such Holder and allow such Holder, at the Holder's expense,
to undertake appropriate action to prevent disclosure of, or to obtain a
protective order for, such information.

k.      The Company shall use its best efforts to secure designation and
quotation of all the Registrable Securities covered by any Registration
Statement on the Principal Market.  If, despite the Company's best efforts,
the Company is unsuccessful in satisfying the preceding sentence, it shall
use its best efforts to cause all the Registrable Securities covered by any
Registration Statement to be listed on each other national securities exchange
and automated quotation system, if any, on which securities of the same class
or series issued by the Company are then listed, if any, if the listing of
such Registrable Securities is then permitted under the rules of such exchange
or system.  If, despite the Company's best efforts, the Company is unsuccessful
in satisfying the two preceding sentences, it will use its best efforts to
secure the inclusion for quotation on the Nasdaq SmallCap Market for such
Registrable Securities if the Company meets the listing requirements and,
without limiting the generality of the foregoing, to arrange for at least two
market makers to register with the National Association of Securities Dealers,
Inc. as such with respect to such Registrable Securities.  The Company shall
pay all fees and expenses in connection with satisfying its obligation under
this Section 3(k).

l.      The Company shall cooperate with the Investor to facilitate the timely
preparation and delivery of certificates (not bearing any restrictive legend)
representing the Registrable Securities to be offered pursuant to a
Registration Statement and enable such certificates to be in such denominations
or amounts, as the case may be, as the Holders may reasonably request.

m.      The Company shall provide a transfer agent for all the Registrable
Securities not later than the effective date of the first Registration
Statement filed pursuant hereto.

n.      If requested by the Holders, the Company shall (i) as soon as
reasonably practical incorporate in a prospectus supplement or post-effective
amendment such information as such Holders reasonably determine should be
included therein relating to the sale and distribution of Registrable
Securities, including, without limitation, information with respect to the
offering of the Registrable Securities to be sold in such offering;
(ii) make all required filings of such prospectus supplement or post-effective
amendment as soon as notified of the matters to be incorporated in such
prospectus supplement or post-effective amendment; and (iii) supplement or
make amendments to any Registration Statement if reasonably requested by such
Holders.

o.      The Company shall use its best efforts to cause the Registrable
Securities covered by the applicable Registration Statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to consummate the disposition of such Registrable Securities.

                                      7
<PAGE>

p.      The Company shall otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC in connection with any registration
hereunder.

q.      Within one (1) business day after the Registration Statement which
includes Registrable Securities is declared effective by the SEC, the Company
shall deliver, and shall cause legal counsel for the Company to deliver, to the
transfer agent for such Registrable Securities, with copies to the Investor,
confirmation that such Registration Statement has been declared effective by
the SEC in the form attached hereto as Exhibit A.

r.      At or prior to the date of the first Put Notice (as that term is
defined in the Investment Agreement) and at such other times as the Holders
may reasonably request, the Company shall cause to be delivered, letters
from the Company's independent certified public accountants (i) addressed
to the Holders that such accountants are independent public accountants
within the meaning of the 1933 Act and the applicable published rules and
regulations thereunder, and (ii) in customary form and covering such
financial and accounting matters as are customarily covered by letters of
independent certified public accountants delivered to underwriters in
connection with public offerings.

s.      The Company shall take all other reasonable actions necessary to
expedite and facilitate disposition by the Holders of Registrable Securities
pursuant to a Registration Statement.

        4.      OBLIGATIONS OF THE HOLDERS.

a.      At least five (5) calendar days prior to the first anticipated filing
date of a Registration Statement  the Company shall notify each Holder of the
information the Company requires from each such Holder if such Holder elects
to have any of such Holder's Registrable Securities included in such
Registration Statement.  It shall be a condition precedent to the obligations
of the Company to complete the registration pursuant to this Agreement with
respect to the Registrable Securities of a particular Holder that such Holder
shall furnish in writing to the Company such information regarding itself, the
Registrable Securities held by it and the intended method of disposition of
the Registrable Securities held by it as shall reasonably be required to effect
the registration of such Registrable Securities and shall execute such
documents in connection with such registration as the Company may reasonably
request.  Each Holder covenants and agrees that, in connection with any sale
of Registrable Securities by it pursuant to a Registration Statement, it shall
comply with the "Plan of Distribution" section of the current prospectus
relating to such Registration Statement.

b.      Each Holder, by such Holder's acceptance of the Registrable Securities,
agrees to cooperate with the Company as reasonably requested by the Company
in connection with the preparation and filing of any Registration Statement
hereunder, unless such Holder has notified the Company in writing of such
Holder's election to exclude all of such Holder's Registrable Securities from
such Registration Statement.

                                      8
<PAGE>

c.      Each Holder agrees that, upon receipt of any notice from the Company of
the happening of any event of the kind described in Section 3(f) or the first
sentence of 3(e), such Holder will immediately discontinue disposition of
Registrable Securities pursuant to any Registration Statement(s) covering
such Registrable Securities until such Holder's receipt of the copies of the
supplemented or amended prospectus contemplated by Section 3(f) or the first
sentence of 3(e).

        5.      EXPENSES OF REGISTRATION.

        All reasonable expenses, other than underwriting discounts and
commissions and fees of the Holder's counsel other than as set forth in the
Investment Agreement, incurred in connection with registrations, filings or
qualifications pursuant to Sections 2 and 3, including, without limitation,
all registration, listing and qualifications fees, printing and accounting
fees, and fees and disbursements of counsel for the Company  shall be paid
by the Company.

        6.      INDEMNIFICATION.

        In the event any Registrable Securities are included in a Registration
Statement under this Agreement:

a.      To the fullest extent permitted by law, the Company will, and hereby
does, indemnify, hold harmless and defend each Holder who holds such
Registrable Securities, the directors, officers, partners, employees, counsel,
agents, representatives of, and each Person, if any, who controls, any Holder
within the meaning of the 1933 Act or the Securities Exchange Act of 1934, as
amended (the "1934 Act"), (each, an "Indemnified Person"), against any losses,
claims, damages, liabilities, judgments, fines, penalties, charges, costs,
attorneys' fees, amounts paid in settlement or expenses, joint or several
(collectively, "Claims"), incurred in investigating, preparing or defending
any action, claim, suit, inquiry, proceeding, investigation or appeal taken
from the foregoing by or before any court or governmental, administrative or
other regulatory agency, body or the SEC, whether pending or threatened,
whether or not an indemnified party is or may be a party thereto ("Indemnified
Damages"), to which any of them may become subject insofar as such Claims
(or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon: (i) any untrue statement or alleged
untrue statement of a material fact in a Registration Statement or any
post-effective amendment thereto or in any filing made in connection with
the qualification of the offering under the securities or other "blue sky"
laws of any jurisdiction in which Registrable Securities are offered
("Blue Sky Filing"), or the omission or alleged omission to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which the statements therein were
made, not misleading, (ii) any untrue statement or alleged untrue statement of
a material fact contained in the final prospectus (as amended or supplemented,
if the Company files any amendment thereof or supplement thereto with the SEC)
or the omission or alleged omission to state therein any material fact
necessary to make the statements made therein, in light of the circumstances
under which the statements therein were made, not misleading, or (iii) any
violation or alleged violation by the Company of the 1933 Act, the 1934 Act,
any other law, including, without limitation, any state securities law, or any
rule or regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to a Registration Statement (the matters in the foregoing
clauses (i) through (iii) being, collectively, "Violations").  Subject to the
restrictions set forth in Section 6(c) with respect to the number of legal
counsel, the Company shall reimburse the Holders and each such controlling
person, promptly as such expenses are incurred and are due and payable, for

                                      9
<PAGE>

any reasonable legal fees or other reasonable expenses incurred by them in
connection with investigating or defending any such Claim. Notwithstanding
anything to the contrary contained herein, the indemnification agreement
contained in this Section 6(a): (i) shall not apply to a Claim arising out of
or based upon a Violation which occurs in reliance upon and in conformity
with information furnished in writing to the Company by any Indemnified
Person expressly for use in connection with the preparation of the Registration
Statement or any such amendment thereof or supplement thereto, if such
prospectus were timely made available by the Company pursuant to Section
3(c); (ii) shall not be available to the extent such Claim is based on
(a) a failure of the Holder to deliver or to cause to be delivered the
prospectus made available by the Company or (b) the Indemnified Person's
use of an incorrect prospectus despite being promptly advised in advance by
the Company in writing not to use such incorrect prospectus;  (iii) any
claims based on the manner of sale of the Registrable Securities by the
Holder; (iv) any omission of the Holder to notify the Company of any material
fact that should be stated in the Registration Statement or prospectus
relating to the Holder or the manner of sale; or (v) shall not apply to
amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of the Company, which consent shall not
be unreasonably withheld.  Such indemnity shall remain in full force and
effect regardless of any investigation made by or on  behalf of the Indemnified
Person and  shall survive the resale of the Registrable Securities by the
Holders pursuant to the Registration Statement.

b.      In connection with any Registration Statement in which a Holder is
participating, each such Holder agrees to severally and not jointly
indemnify, hold harmless and defend, to the  same extent and in the same
manner as is set forth in Section 6(a), the Company, each of its  directors,
each of its officers who signs the Registration Statement, each Person, if
any, who controls the Company within the meaning of the 1933 Act or the 1934
Act and the Company's agents (collectively and together with an Indemnified
Person, an "Indemnified Party"), against any Claim or Indemnified Damages to
which any of them may become subject, under the 1933 Act, the 1934 Act or
otherwise, insofar as such Claim or Indemnified Damages arise out of or are
based upon any Violation, in each case to the extent, and only to the extent,
that such Violation occurs in reliance upon and in conformity with written
information furnished to the Company by such Holder expressly for use in
connection with such Registration Statement; and, subject to Section 6(c),
such Holder will reimburse any legal or other expenses reasonably incurred
by them in connection with investigating or defending any such Claim;
provided, however, that the indemnity agreement contained in this Section
6(b) and the agreement with respect to contribution contained in Section 7
shall not apply to amounts paid in settlement of any Claim if such settlement
is effected without the prior written consent of such Holder, which consent
shall not be unreasonably withheld; provided, further, however, that the
Holder shall be liable under this Section 6(b) for only that amount of a
Claim or Indemnified Damages as does not exceed the net proceeds to such
Holder as a result of the sale of Registrable Securities pursuant to such
Registration Statement.  Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Indemnified Party
and shall survive the resale of the Registrable Securities by the Holders
pursuant to the Registration Statement. Notwithstanding anything to the
contrary contained herein, the indemnification agreement contained in this
Section 6(b) with respect to any preliminary prospectus shall not inure to
the benefit of any Indemnified Party if the untrue statement or omission of
material fact contained in the preliminary prospectus were corrected on a
timely basis in the prospectus, as then amended or supplemented.  This
indemnification provision shall apply separately to each Investor and
liability hereunder shall not be joint and several.

                                      10
<PAGE>
c.      Promptly after receipt by an Indemnified Person or Indemnified Party
under this Section 6 of notice of the commencement of any action or proceeding
(including any governmental action or proceeding) involving a Claim, such
Indemnified Person or Indemnified Party shall, if a Claim in respect thereof
is to be made against any indemnifying party under this Section 6, deliver
to the indemnifying party a written notice of the commencement thereof, and
the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the Indemnified Person or
the Indemnified Party, as the case may be; provided, however, that an
Indemnified Person or Indemnified Party shall have the right to retain its own
counsel with the fees and expenses to be paid by the indemnifying party, if,
in the reasonable opinion of counsel retained by the indemnifying party, the
representation by such counsel of the Indemnified Person or Indemnified Party
and the indemnifying party would be inappropriate due to actual or potential
differing interests between such Indemnified Person or Indemnified Party and
any other party represented by such counsel in such proceeding.  The
indemnifying party shall pay for only one separate legal counsel for the
Indemnified Persons or the Indemnified Parties, as applicable, and such counsel
shall be selected by the Holders, if the Holders are entitled to
indemnification hereunder, or the Company, if the Company is  entitled to
indemnification hereunder, as applicable.  The Indemnified Party or
Indemnified Person shall cooperate fully with the indemnifying party in
connection with any negotiation or defense of any such action or Claim by
the indemnifying party and shall furnish to the indemnifying party all
information reasonably available to the Indemnified Party or Indemnified
Person which relates to such action or Claim.  The indemnifying party shall
keep the Indemnified Party or Indemnified Person fully appraised at all
times as to the status of the defense or any settlement negotiations with
respect thereto.  No indemnifying party shall be liable for any settlement
of any action, claim or proceeding effected without its written consent,
provided, however, that the indemnifying party shall not unreasonably
withhold, delay or condition its consent. No indemnifying party shall,
without the consent of the Indemnified Party or Indemnified Person, consent
to entry of any judgment or enter into any settlement or other compromise
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such Indemnified Party or Indemnified Person of a
release from all liability in respect to such Claim.  Following indemnification
as provided for hereunder, the indemnifying party shall be surrogated to all
rights of the Indemnified Party or Indemnified Person with respect to all
third parties, firms or corporations relating to the matter for which
indemnification has been made.  The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the
extent that the indemnifying party is prejudiced in its ability to defend
such action.

d.      The indemnification required by this Section 6 shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Damages are incurred.

                                      11
<PAGE>

e.      The indemnity agreements contained herein shall be in addition to
(i) any cause of action or similar right of the Indemnified Party or
Indemnified Person against the indemnifying party or others, and (ii) any
liabilities the indemnifying party may be subject to pursuant to the law.

        7.      CONTRIBUTION.

        To the extent any indemnification by an indemnifying party is
prohibited or limited by law, the indemnifying party agrees to make the
maximum contribution with respect to any amounts for which it would
otherwise be liable under Section 6 to the fullest extent permitted by
law; provided, however, that: (i) no contribution shall be made under
circumstances where the maker would not have been liable for indemnification
under the fault standards set forth in Section 6; (ii) no seller of
Registrable Securities guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution
from any seller of Registrable Securities who was not guilty of fraudulent
misrepresentation; and (iii) contribution by any seller of Registrable
Securities shall be limited in amount to the net amount of proceeds received
by such seller from the sale of such Registrable Securities.

        8.      REPORTS UNDER THE 1934 ACT.

        With a view to making available to the Holders the benefits of
Rule 144 promulgated under the 1933 Act or any other similar rule or regulation
of the SEC that may at any time permit the Holders to sell securities of the
Company to the public without registration ("Rule 144"), the Company agrees
to:

a.      make and keep public information available, as those terms are
understood and  defined in Rule 144;

b.      file with the SEC in a timely manner all reports and other
documents required of the Company under the 1933 Act and the 1934 Act so
long as the Company remains subject to such requirements (it being understood
that nothing herein shall limit the Company's obligations under Section 5(c)
of the Investment Agreement) and the filing of such reports and other documents
is required for the applicable provisions of Rule 144; and

c.      furnish to the Investor, promptly upon request, (i) a written statement
by the Company that it has complied with the reporting requirements of
Rule 144, the 1933 Act and the 1934 Act, (ii) a copy of the most recent annual
or quarterly report of the Company and such other reports and documents so
filed by the Company, and (iii) such other information as may be reasonably
requested to permit the Investor to sell such securities pursuant to Rule 144
without registration.

        9.      NO ASSIGNMENT OF REGISTRATION RIGHTS.

        The rights under this Agreement shall not be assignable.

                                      12
<PAGE>

        10.     AMENDMENT OF REGISTRATION RIGHTS.

        Provisions of this Agreement may be amended only with the written
consent of the Company and Holders. No such amendment shall be effective to the
extent that it applies to less than all of the Holders of the Registrable
Securities.

        11.     MISCELLANEOUS.

a.      A Person is deemed to be a Holder of  Registrable  Securities  whenever
such Person owns of record such Registrable Securities.  If the Company
receives conflicting instructions, notices or elections from two or more
Persons with respect to the same Registrable Securities, the Company shall
act upon the basis of instructions, notice or election received from the
registered owner of such Registrable Securities.

b.      Any notices or other communications required or permitted to be given
under the terms of this Agreement must be in writing and will be deemed to have
been delivered (i) upon receipt, when delivered personally; (ii) upon receipt,
when sent by facsimile (provided a confirmation of transmission is mechanically
or electronically generated and kept on file by the sending party); or (iii)
one (1) day after deposit with a nationally recognized overnight delivery
service, in each case properly addressed to the party to receive the same.
The addresses and facsimile numbers for such communications shall be:

If to the Company:

        Vital Products, Inc.
        Michael Levine
        35 Adesso Drive
        Concord, ON, L4K 3C7
        Canda

        Tel:    416 650 5711
        Fax:    416 650 1255

If to the Investor:

        Dutchess  Private  Equities  Fund, II, LP
        312  Stuart  St,  Third  Floor
        Boston,  MA  02116
        Telephone:  617-960-3570
        Facsimile:  617-960-3772

        Each party shall provide five (5) business days prior notice to the
other party of any change in address, phone number or facsimile number.

c.      Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or
remedy, shall not operate as a waiver thereof.

                                      13
<PAGE>

d.      The laws of the State of Massachusetts shall govern all issues
arising from or related to this Agreement without regard to the principles
of conflict of laws. Each party hereby irrevocably submits to the
non-exclusive jurisdiction of the state and federal courts sitting in the
City of Boston, County of Suffolk, for the adjudication of any dispute
hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not
to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is brought in an inconvenient forum or that the venue
of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address for such notices to it under this
Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner permitted
by law.  If any provision of this Agreement shall be invalid or unenforceable
in any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction.

e.      This Agreement and the Transaction Documents constitute the entire
agreement among the parties hereto with respect to the subject matter hereof
and thereof.  There are no restrictions, promises, warranties or undertakings,
other than those set forth or referred to herein and therein.

f.      This Agreement and the Transaction Documents supersede all prior
agreements and understandings among the parties hereto with respect to the
subject matter hereof and thereof.

g.      The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.  Whenever
required by the context of this Agreement, the singular shall include the
plural and masculine shall include the feminine.  This Agreement shall not
be construed as if it had been prepared by one of the parties, but rather
as if all the parties had prepared the same.

h.      This Agreement may be executed in two or more identical counterparts,
each of which shall be deemed an original but all of which shall constitute
one and the same agreement.  This Agreement, once executed by a party, may
be delivered to the other party hereto by facsimile transmission of a copy
of this Agreement bearing the signature of the party so delivering this
Agreement.

i.      Each party shall do and perform, or cause to be done and performed,
all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions
contemplated hereby.

k.      The language used in this Agreement will be deemed to be the language
chosen by the parties to express their mutual intent and no rules of strict
construction will be applied against any party.

                                      14
<PAGE>

IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement
to be duly executed as of the day and year first above written.

                        Vital Products, Inc.

                                  /s/ Michael Levine
                                -------------------------------
                                Name: Michael Levine
                        Title:  CEO

                        DUTCHESS PRIVATE EQUITIES FUND, II, L.P.
                        BY ITS GENERAL PARTNER DUTCHESS
                        CAPITAL MANAGEMENT, LLC

                             /s/Douglas H. Leighton
                        --------------------------------
                        Name:   Douglas H. Leighton
                        Title:  A Managing Member

                                      15
<PAGE>

                                   EXHIBIT A

FORM OF NOTICE OF EFFECTIVENESS
OF REGISTRATION STATEMENT

                                                             Date: __________
[TRANSFER AGENT]

        Re:     Vital Products, Inc.
Ladies and Gentlemen:

        We are counsel to Vital Products, Inc., a Delaware corporation
(the "Company"), and have represented the Company in connection with that
certain Investment Agreement (the "Investment Agreement") entered into by
and among the Company and _________________________ (the "Investor") pursuant
to which the Company has agreed to issue to the Investor shares of the
Company's common stock, .0001 par value per share (the "Common Stock") on the
terms and conditions set forth in the Investment Agreement.  Pursuant to the
Investment Agreement, the Company also has entered into a Registration Rights
Agreement with the Investor (the "Registration Rights Agreement") pursuant to
which the Company agreed, among other things, to register the Registrable
Securities (as defined in the Registration Rights Agreement), including the
shares of Common Stock issued or issuable under the Investment Agreement,
under the Securities Act of 1933, as amended (the "1933 Act").  In connection
with the Company's obligations under the Registration Rights Agreement,
on ____________ ___, 2005, the Company filed a Registration Statement on
Form SB ___ (File No. 333-________) (the "Registration Statement") with the
Securities and Exchange Commission (the "SEC") relating to the Registrable
Securities which names the Investor as a selling shareholder thereunder.

        In connection with the foregoing, we advise you that a member of the
SEC's staff has advised us by telephone that the SEC has entered an order
declaring the Registration Statement effective under the 1933 Act at
[enter the time of effectiveness] on [enter the date of effectiveness] and
to the best of our knowledge, , no stop order suspending its effectiveness
has been issued and no proceedings for that purpose are pending before, or
threatened by, the SEC and the Registrable Securities are available for
resale under the 1933 Act pursuant to the Registration Statement.

                                                Very truly yours,

                                                [Company Counsel]

                                                By:____________________

cc:     [Investor]

                                      16
<PAGE>

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