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Purchase Order Terms & Conditions

TESAR INDUSTRIAL CONTRACTORS, INC., hereby called the Contractor. 


Hereinafter called the Subcontractor (for material purchases only, the word Supplier shall be substituted for the word Subcontractor), as an independent contractor to perform the following part of the Work which the Contractor has contracted with the Owner to provide on the Project.

The Subcontractor agrees to perform such part of the Work (hereinafter called the “Subcontractor’s Work”) under the general direction of the Contractor and subject to the final approval of the Architect/Engineer or other specified representatives of the Owner in accordance with the Contractor Documents. The Contractor agrees to pay the Subcontractor for the satisfactory completion of the Subcontractor’s Work

Contractor and Subcontractor agree to be bound by the following terms and conditions (the “Agreement”). 


1.         OFFER AND ACCEPTANCE:  Any provisions in the Subcontractor’s invoices, proposal, billing statements, acknowledgment forms, or similar documents that are inconsistent with the provisions of this Agreement shall be of no force and effect, regardless of whether such provisions would materially alter the terms hereof, unless such terms are specifically acknowledged in writing by the Contractor and are signed by the Contractor.  No proposal, quotation, or other agreement of Subcontractor shall be considered part of this Agreement.  Subcontractor’s commencement of shipment, promise of shipment, or the furnishing of merchandise, services, or work that is the subject matter of this Agreement shall constitute Subcontractor’s acceptance to be bound by the terms and conditions of this Agreement.  Subcontractor agrees to follow the shipping and invoicing instructions issued by the Contractor.  Contractor may revoke or modify this Agreement at any time prior to acceptance by Subcontractor.  Only stenographic, arithmetic, and clerical errors are subject to correction, and only with the consent of Contractor.


2.         INCORPORATION BY REFERENCE:  Subcontractor agrees to supply all Merchandise and materials and to perform all portions of the Services or Work hereunder for Contractor, subject to and in strict accordance with the terms and conditions set forth in this Agreement and all such general, special, and supplemental conditions, drawings, plans, specifications, and delivery and construction schedules to which the Contractor is bound to the Contractor’s Customer for the Project for which this Agreement is made.  It is further understood and agreed that all documents between Contractor and Contractor’s Customer also are incorporated into this Agreement by reference and are made a part of this Agreement.  The documents remain available to Subcontractor to Subcontractor at reasonable times at the branch office of Contractor that is managing the Project.  This Agreement and the provisions of the referenced documents are intended to supplement and compliment each other and if there is a conflict within this Agreement or within any of the referenced documents, the provision imposing the higher quality, greater quantity or greater duty or obligation on Subcontractor shall govern.  Subcontractor shall be bound by all interpretations of the Contract Documents made by Contractor’s customer, or the project architect or engineer that are binding upon Contractor.  Subcontractor agrees to be bound by, and to assume toward Contractor, all the terms, obligations, responsibilities, and conditions of the referenced and incorporated documents to the same extent that Contractor, in turn, is bound by such referenced documents to the Contractor’s customer or the Project Owner.  The referenced and incorporated documents shall collectively be referred to as the “subcontract documents.”


3.         PRICES:  Unless otherwise specified, prices are F.O.B. Contractor’s facility and/or jobsite specified in the purchase order, and prices include the amounts of all applicable sales, use, transfer, excise, or other taxes, tariffs, or custom duties.


4.         TERMS OF PAYMENT:  Terms of payment, unless otherwise expressly agreed in writing, are as set forth in the face of the purchase order (including payment terms incorporated herein by reference).  Progress or final payments shall be due within ten (10) days of Contractor’s receipt of payment from Contractor’s customer providing all other material terms of the Agreement have been satisfied.  Subcontractor understands and agrees that Contractor’s receipt of payment customer on account of Subcontractor’s merchandise and services is an express and absolute condition precedent to Contractor’s obligation to pay Subcontractor.  Subcontractor hereby assumes the risk of default or nonpayment by Contractor’s customer, and the creditworthiness of Contractor’s customer.  Subcontractor shall not be entitled to recover interest on late or past due payments.  Risk of loss with respect to nonconforming merchandise or services shall not pass to Contractor unless and until nonconformities are cured or Contractor accepts the merchandise or services in writing despite the nonconformities.  All payments shall be made in United States currency.  Payment shall not be to the prejudice of any claims that Contractor might have against Subcontractor on account of omissions or shortages in shipment or defects or deficiencies in the merchandise or services.  Subcontractor shall submit, as a condition precedent to any payment, details of cost, waivers of lien, and sworn affidavits of subcontractor, prevailing wage, or payroll reports, EEO reports, consent of surety to payments, and any other documentation (in form and substance satisfactory to Contractor and Contractor’s customer) as Contractor nay request from time to time.  To the extent a partial payment is based upon estimated quantities, the amount due to Subcontractor shall be determined based upon the estimates approved by the Contractor’s customer.  Such partial payments based upon estimates are approximate only and all partial estimates and payment shall be subject to correction by Contractor in the final estimates and payment.  In addition to the requirements set forth in this Agreement, final payment shall not become due to the Subcontractor until the Subcontractor submits to the Contractor (1) an affidavit satisfactory to Contractor and Contractor’s customer that payrolls, bills for material and equipment, and other indebtedness of Subcontractor relating to the Project for which the Contractor or its customer might be liable have been paid or otherwise satisfied; (2) a certificate indicating that the insurance required by the Contract Documents is in force and will remain in force per Paragraph 11 of the Agreement following completion of the Subcontractor’s performance; (3) releases and waivers of liens and claims of the Subcontractor and each subcontractor, material man, and vendor of Subcontractor (and their respective lower tiers); and (4) consent of Subcontractor’s surety to release of final payment.  Unless otherwise provided in the Agreement, Contractor shall have the right to withhold a 10% retainage from any payments (whether progress payments or the final payment) due to Subcontractor.  The retainage shall be paid to Subcontractor within ten (10) days after the last to occur of the following: (a) final delivery, completion and performance of all Merchandise, Services, or Work and obligations under this Agreement by Subcontractor; (b) delivery to Contractor of such sworn statements, affidavits, certificates and releases of lien as Contractor may require to evidence the full and final release of mechanics’ liens and claims by Subcontractor and by all laborers, subcontractors and material men of Subcontractor and all lower tiers; (c) delivery to Contractor of all manuals, drawings, warranties, guarantees and other documents required by this Agreement or the subcontract documents; and (d) Contractor’s receipt of retainage from Contractor’s customer covering Subcontractor’s Merchandise, Services, or Work.  Notwithstanding the foregoing, the Contractor shall have the right to withhold retainage to cover any guarantee or warranty period required by the agreement between Contractor and its customer unless a maintenance bond is provided by Subcontractor.


5.         SCOPE OF WORK:  The Merchandise, Services, or work of Subcontractor includes, but is not limited to, such of the following as may be necessary to perform and complete the Work: all plant, materials, tools, equipment (whether for temporary or permanent use), scaffolding, supplies, transportation, cartage, loading, hoisting, forms, patterns, models, shop drawings, measurements, and other facilities; all labor, work, supervision, cutting, patching, cleaning, temporary construction and other services; and all insurance, taxes, benefits, royalties, temporary utilities and other related costs except as otherwise provided in this Agreement.  Subcontractor shall be responsible for all Work under the subcontract documents or reasonably inferable there from in order to provide a complete project.


6.         TIME AND COORDINATION: Subcontractor shall diligently and continuously prosecute and complete its Services and Work with the other work being performed on the project and premises, in accordance with the time and scheduling requirements set forth in this Agreement and the other subcontract documents, or any revisions or modifications thereto.  TIME IS OF THE ESSENCE.  If the progress of the project on the premises or any component thereof is delayed, obstructed, hindered or interfered with by any fault, neglect, or failure to act of Subcontractor or any of its officers, agents, employees, subcontractors, or suppliers so as to cause any additional cost, expense, liability or damage to Contractor or Contractor’s customer, then Subcontractor agrees to reimburse Contractor and the Contractor’s customer for, and indemnify them against, all such costs, expenses, liabilities or damages.  Without limiting the generality of the foregoing, if liquidated damages are assessed against the Contractor as a result of Subcontractor’s failure to deliver its Merchandise or perform its Services or Work in accordance with the schedule set forth in the subcontract documents, then Contractor shall have the right to recover the amount of such damages from Subcontractor either by deducting such amount from any monies due or which may become due to the Subcontractor or by any other means available to Contractor.  Subcontractor shall continually monitor the project so as to be fully familiar with the timing, phasing, and sequence of the operations of the Work and of other work on the project.  Subcontractor shall coordinate the delivery of its Merchandise and the performance of its Services or Work with any other work in such manner as Contractor may direct to avoid conflict or interference of such work with others, shall participate in the preparation of coordination drawings and shall conform its Merchandise, Services or Work to the work of Contractor and others and the subcontract documents to prevent discrepancies (and to avoid unnecessary cutting or patching) with contiguous work.  Without waiving any other rights or remedies, Contractor shall have the right, but not the obligation, to supplement the forces of Subcontractor at Subcontractor’s expense to maintain progress of the work, or to correct non-conforming or Defective Work, Services or Merchandise.


7.         SITE CONDITIONS: Subcontractor acknowledges that Contractor has made no representations or warranties expressed or implied regarding the work or the Project and Subcontractor has undertaken the Work under this Agreement at Subcontractor’s own risk and Subcontractor is not relying upon any opinions or representations of Contractor, the Contractor’s customer, or any of their respective officers, agents, or employees.  Subcontractor shall not be entitled to any additional compensation or damages by reason of any conditions of the Work that differ from what the Subcontractor expected, and Subcontractor waives the right to make any claims against Contractor based upon conditions encountered at the Premises.


8.         PERMITS, LICENSES, AND COMPLIANCE WITH LAWS: Subcontractor shall secure, pay for, and keep in effect all licenses, permits and inspection certificates necessary for the proper execution and completion of the Work and shall deliver all certificates of inspection and other certificates and permits to Contractor.  Subcontractor shall comply with all laws, ordinances, rules, and regulations of governmental entities having jurisdiction, including but not limited to those relating to safety, health, discrimination in employment, wages, fair employment practices or equal opportunity, and with the requirements of the governing authorities applicable to this Agreement.  In accepting this Agreement, Subcontractor shall be deemed to represent that the merchandise or services was or will be produced or performed in compliance with all requirements of law or regulation including but not limited to those regarding labor practices and drug free workplace. 


9.         TAXES; SHIPMENTS:  Subcontractor shall file all tax returns and reports with and pay when due all taxes and contributions owing to each governmental entity or subdivision applicable to the Merchandise, Services or Work or to the wages of its employees for services in connection with this Agreement.  Contractor may withhold payment in the amount of any such funds unpaid by Subcontractor.


10.       WORKERS’ COMPENSATION:  Subcontractor, at its expense, shall fully comply with the workers’ compensation law for each state in which the Work is performed by its employees’ providing coverage for statutory benefits and Employer’s Liability Coverage of $1,000,000 per occurrence/accident/employee, and with the safety and other regulations of the governmental authorities that administer such laws and deliver such certificates to Contractor upon demand.  The worker’s compensation policy shall be endorsed to provide a waiver of subrogation in favor of Contractor. 


11.       INSURANCE:  Subcontractor, at its expense, shall obtain prior to the commencement of the Work or the furnishing of the Merchandise or Services and maintain in effect (and furnish Contractor certificates in triplicate or, if requested by Contractor, copies of the policies evidencing that it has in effect), the following insurance coverage and minimum limits with insurance carriers acceptable to Contractor.

  1. Commercial General Liability – This insurance shall be written on an occurrence basis with limits not less than $1,000,000 per occurrence and $2,000,000 annual aggregate.  The policy shall include coverage for Premises/Operations, Independent Contractors, Contractual Liability (sufficient to cover the liability assumed by the Subcontractor under the Agreement), Property Damage arising out of the “XCU” hazards, Completed Operations, Products Liability, Broad Form Property Damage, and Personal Injury.  The Completed Operations coverage shall be maintained for at least three (3) years after the final completion of the Project of which the Work and the Merchandise or Services are a part.  If the policy contains a general aggregate limitation, then the policy shall be endorsed to provide a $1,000,000 specific aggregate for the Work under this Agreement.

  2. Business Automobile Liability – the policy shall contain limits of not less than $1,000,000 Combined Single Limit and include coverage for all Owned, Hired and Non-owned automobiles.

  3. Excess/Umbrella Liability – the policy(ices) shall be written with limits of not less than $1,000,000 Combined Single Limit and shall be endorsed in the same form and manner as the Commercial General Liability, Business Automobile Liability, and Employer’s Liability coverage.

  4. Professional Liability – If Subcontractor is performing design or other professional services, the professional liability (errors and omissions) coverage shall contain limits of not less than $2,000,000 annual aggregate.  If the professional liability (errors and omissions) insurance is written on a claims made basis, then such insurance shall have the retroactive date no later than the date of the Agreement and shall include a supplemental extended period provision.  Subcontractor shall require each of its subcontractors and consultants providing engineering or architectural services to maintain separate errors and omissions (professional liability) insurance coverage to protect against claims or damages arising out of the performance of their respective services in furtherance of the Agreement.


Subcontractor shall comply at no additional cost with any requirements on the Contract or Subcontract Documents requiring higher limits of insurance or different types of insurance.  The Contractor shall be named as an additional insured to Subcontractor’s liability insurance policies for liabilities or claims arising out of the Merchandise, Services or Work, and such insurance shall be endorsed so as to make it primary to any liability insurance carried by the Contractor.  No policy of insurance naming Contractor as an additional insured shall contain any exclusion or prohibition against first party claims or claims of any party named as an additional insured.  In lieu of naming Contractor as an additional insured as required herein, Subcontractor, at its sole cost and expense, may purchase an Owners & Contractor’s Protective Liability Policy on behalf of Contractor, all in form and substance acceptable to Contractor.  Certificates of Insurance, and copies of policies, if requested, acceptable to the Contractor shall be delivered to the Contractor prior to the commencement of the Work.  These Certificates as well as the insurance policies required by this paragraph shall contain a provision that coverage will not be canceled or allowed to expire until at least thirty (30) days prior written notice has been given to the Contractor.  The foregoing insurance coverage are required to remain in force for a period of three (3) years after final payment by Contractor to Subcontractor, and any additional certificate evidencing continuation of such coverage shall be submitted to the Contractor prior to final payment.  The Contractor and Subcontractor waive all rights against each other and the Contractor’s and Subcontractor’s agents and employees, each of the other, for damages caused by fire or other perils to the extent covered by insurance applicable to the Project, Merchandise, Services or Work, except such rights as they may have to the proceeds of such insurance.  The Contractor or Subcontractor, as appropriate, shall require from their contracting partner by appropriate agreement, written where legally required for validity, similar waivers each in favor of the other parties enumerated in this Paragraph.


  1. NO ASSIGNMENT: Absent Contractor’s written consent, Subcontractor may not assign any rights or delegate any duties that Subcontractor may have under this Agreement, in whole or in part.  Any assignment or delegation in violation of the foregoing is void and not binding on Contractor.  No such assignment or delegation shall bar Contractor from asserting against Subcontractor, or the transferee, or both, any claim or right that Contractor may have against Subcontractor, including any right or recoupment or set-off.


  1. UNAVOIDABLE CANCELLATION: Contractor reserves the right to cancel this order in whole or in part in the event of lockout, strike, unavoidable accident, riot, act of God, fire, flood, earthquake, or any other casualty whatsoever affecting Contractor.  Such cancellation shall be without penalty to Contractor and subject to Paragraph 15.


  1. CANCELLATION FOR CAUSE: This Agreement is not subject to cancellation or modification by Subcontractor, in whole or in part, except with Contractor’s express written consent.  Contractor may terminate and rescind all or part of this Agreement upon three (3) days prior written notice and opportunity to cure in the event Subcontractor breaches or fails to perform any of its obligation under this Agreement or the Subcontract Documents, or in the event Subcontractor becomes insolvent or proceedings are instituted by or against Subcontractor under any provisions of any federal or state bankruptcy or insolvency laws, or in the event Subcontractor ceases its operations, or in the event Contractor requests adequate assurance of due performance and Subcontractor fails to provide such assurance in writing within three (3) days after the date of Contractor’s request therefore.  Time is of the essence to this Agreement, and Subcontractor’s failure to meet, or apparent inability to meet, any delivery date, milestone dates, or completion dates shall constitute a material breach of this Agreement.  Subcontractor shall not be entitled to payment for Merchandise, Services, or Work furnished under this Agreement after the cancellation date.  Contractor shall have the right to deduct the cost of remedying the default, supplementing Subcontractor’s forces, and completing the Subcontractor’s performance under this Agreement with either Contractor’s own forces or through the services of third parties.  Contractor shall be entitled to deduct the cost of completion for sums otherwise due or to become due Subcontractor.  Subcontractor shall be obligated to reimburse Contractor upon demand for any expenses or cots of supplementation or completion that exceed sums due Subcontractor under the Agreement.  In the event that a termination or cancellation under this paragraph is determined to be unjustified or wrongful, then the termination or cancellation shall be treated as a “Convenience termination” under Paragraph 15, and Subcontractor’s remedies and damages are limited as provided for in Paragraph 15.


  1. CONVENIENCE CANCELLATION / SUSPENSION: Contractor shall have the option at any time, without cause, (whether or not Subcontractor is in default) upon written notice to Subcontractor, to cancel or terminate this Agreement in whole or in part, or to delay or suspend the delivery or completion of all or part of the Merchandise, Services, or Work.  Such termination, suspension or delay shall be without cost to Contractor.  Subcontractor only shall have the right to completion (a) in the case of termination, for its actual costs of Merchandise, Services, or Work actually furnished by Subcontractor in connection with this Agreement prior to such termination; provided, however, that in no event shall such amount, together with all previous payments made to Subcontractor, exceed the price(s) set forth in this Agreement; or (b) in the case of delay or suspension, for reasonable handling and storage charges or overhead damages and other indirect expenses.  Under n circumstances shall Subcontractor be entitled to anticipated profits or lost profits for Merchandise, Services, or Work that remain to be furnished or performed.  Subcontractor also shall not be entitled to storage charges or other consequential, incidental, or special damages or termination costs or expenses.  Contractor’s obligation to pay Subcontractor is expressly conditioned on Contractor’s receipt of actual payment from Contractor’s customer on account thereof.


  1. SUBCONTRACTOR’S REPRESENTATIONS AND WARRANTIES: Subcontractor represents and warrants to Contractor, in addition to all warranties implied by law, that each item of Merchandise, Services, or Work described on the face hereof, together with all related packaging and labeling and furnished by Subcontractor, shall (a) be free from defects in design, workmanship and materials including, without limitation, such defects as could create a hazard to life or property or defect in Subcontractor’s or Contractor’s work; (b) conform in all respects with all applicable federal, state and local laws, order and regulations, including, but not limited to, those regarding occupational safety and health and wage and hour laws; (c) not infringe or encroach upon Contractor’s or any third party’s personal, contractual or proprietary rights, including patents, trademarks, copyrights, rights of privacy or trade secrets; and (d) conform to all of Contractor’s specifications and the Subcontract Documents, and to all articles shown to Contractor as samples of Subcontractor’s Merchandise or Services.  All warranties set forth in this paragraph, or in any other part of this Agreement (including warranties incorporated herein by reference), or which law implies, shall survive any inspection, acceptance, or payment by Contractor.  Such warranties shall be in addition to Contractor’s other rights and remedies and shall not be construed as a limitation on Contractor’s claims or rights, including the right to enforce the Agreement against Subcontractor for the applicable statutes of limitation for breach of a written contract.  Subject to the foregoing, Subcontractor warrants all goods and services for a period of no less than two (2) years from the date of delivery or completion of Subcontractor’s performance under the Agreement or substantial completion of the project that is the subject matter of this Agreement, whichever is later.  In the event of a warranty claim, Subcontractor shall remove and replace any defective or nonconforming Merchandise or Services at Subcontractor’s sole cost and expense.  Subcontractor also shall be responsible for the cost of correcting the goods and work and property of Contractor, Contractor’s customer, or others damaged by Subcontractor’s defective Merchandise or Services, including goods and work of Contractor and others that are damaged by Subcontractor in connection with Subcontractor’s performance of warranty work.


  1. MERCHANTABILITY: Subcontractor represents and warrants to Contractor that all merchandise or services delivered or work performed pursuant to this Agreement will be merchandise at the time of delivery to Contractor and at the time of use by Contractor’s customers, and will be fit and safe for sale and use by Contractor or its customers for which such items are ordinarily intended and for any particular intended use of which Subcontractor or its agents have actual or constructive knowledge.


  1. INDEMNIFICATION: Subcontractor shall reimburse, indemnify, hold harmless, and defend Contractor, Contractor’s customer, the Project, and the Project owners (and their respective officers, employees, partners, agents and representatives) from and against any claim, lien, mechanics’ lien, cause of action, lawsuit, demand, fine, penalty, assessment, loss, expense or damage of whatever kind or description (including legal fees), including any special, incidental and consequential damages arising from or relating to Subcontractor’s performance under this Agreement, Subcontractor’s negligence or other wrongful acts, or Subcontractor’s breach of this Agreement.  The scope of this indemnity agreement includes, without limitation, any and all claims, damages, demands, assessments, or lawsuits for personal injury, death, or property damage, which may result from Subcontractor’s negligence or other wrongful acts or Subcontractor’s breach of this Agreement or its representations and warranty obligations under this Agreement or which may result from any products liability claims relating to the Merchandise or Services.  The scope of this indemnity agreement applies to the acts or omissions of Subcontractor, its agents, employees and subcontractors, vendors, material men, and lower tiers, or anyone for whom Subcontractor is legally responsible.  Subcontractor, at Subcontractor’s sole expense, shall promptly dispose of all such claims and liens, defend all lawsuits filed against Contractor or Contractor’s customer or the Project owner on account thereof, pay all judgments rendered against Contractor in such lawsuits (including any prejudgment interest assessed against any inductee hereunder), and reimburse Contractor or Contractor’s customer in cash upon demand for all reasonable expenses incurred by Contractor or Contractor’s customer on account thereof including, but not limited to, attorney fees, expert witness fees and court costs.  Subcontractor’s obligation to indemnify Contractor under this provision shall not apply to any losses to the extent initiated or proximately caused by or resulting from the sole or concurrent negligence or willful misconduct of any of the parties indemnified hereunder.  Notwithstanding anything to the contrary contained herein, Contractor at its option shall have the right to participate in the defense of any claims asserted against it, approve the selection of counsel, and approve the terms of any settlements made in its name or on its behalf.  The scope of Subcontractor’s duty to defend and indemnify Contractor under this paragraph shall not be limited in any manner whatsoever by any immunity or limitations of liability afforded Subcontractor under the workers’ compensation laws, constitutions, or any other employee benefit acts.  Subcontractor specifically waives any immunity afforded it by Ohio Constitution Article 2, Section 35, and Ohio Revised Code 4123.74.


  1. LIEN WAIVER AND BONDING LIENS: For good and valuable consideration, including the negotiated price for the Merchandise, Services or Work under this Agreement, Subcontractor unconditionally waives and releases any and all mechanics’ lien rights or claims of rights or claims of lien rights against the premises or Project or Contractor funds due on the Project fund.  Subcontractor agrees not to file, or permit its subcontractors, vendors, laborers, unions, or material men (including lower tiers), to file any mechanics’ liens or attested accounts to secure payment for materials or work furnished in furtherance of this Agreement.  Subcontractor further agrees that any such lien shall be void and unenforceable and shall constitute a substantial and material breach of this Agreement.  Contractor shall be entitled to set-off against any sums due or to become due Subcontractor under this Agreement an amount equal to two (2) times the amount of the lien or attested account or other claim of Subcontractor or any of Subcontractor’s subcontractors, suppliers, vendors, material men, laborers, unions, and lower-tiers.  Contractor shall be entitled to recover from Subcontractor the attorneys’ fees, bond premiums, and expenses that Contractor incurs to defend and/or discharge any such mechanics’ lien or attested account claim of Subcontractor, or Subcontractor’s subcontractors, vendors, suppliers, material men, unions, laborers, or lower tiers.  Subcontractor further agrees to indemnify, defend and hold Contractor and Contractor’s customer, the Project, the premises, and the Project owners (and their respective officers, employees, partners, agents and representatives) harmless from and against any and all liens, claims, damages, demands and causes of action by any subcontractors, suppliers, vendors, laborers, unions, and other persons or entities working directly or indirectly for Subcontractor (including lower-tier subcontractors, suppliers, and vendors) arising from or relating in any way to any work or materials furnished hereunder.  Within five (5) days after receipt of written notice from Contractor, Subcontractor shall cause to be discharged and released any lien or claim of Subcontractor or any of Subcontractor’s subcontractors, suppliers, vendors, laborers, unions, and other persons or entities working directly or indirectly for Subcontractor (including lower-tier subcontractors, suppliers, and vendors).  In the event of a lien by a subcontractor, supplier, material man, vendor, laborer, union or other lower tier of Subcontractor, Subcontractor shall immediately upon demand by Contractor post a surety bond or other alternate security to discharge the lien from the Project and/or property, in accordance with Chapter 1311.01 et seq. of the Ohio Revised Code.  If Subcontractor fails to honor its obligations under this paragraph, then Contractor may, at Contractor’s sole option (and without incurring direct liability to any third-party to this Agreement), pay the claim directly and deduct the amount of Contractor’s direct payment from the sums due Subcontractor under this Agreement.  The provisions in this paragraph shall be in addition to Contractor’s other rights, and Subcontractor’s other obligations, in this Agreement.


  1. SHOP DRAWINGS: Subcontractor shall, at its own expense, prepare and submit to Contractor such shop drawings, samples, models and other submittals for the Merchandise, Services or Work as may be requested by the Contractor.  Such shop drawings, samples, models, and other submittals shall be approved in writing by such persons as Contractor may designate before Subcontractor proceeds under this Agreement.  No approval of any submittals nor the making of any payment to Subcontractor shall constitute an acceptance of any Merchandise, Services or Work or impair Contractor’s right of inspection or rejection or any other rights or remedies to which Contractor may be entitled or relieve Subcontractor from any of its obligations or warranties hereunder.


  1. OWNERSHIP OF DOCUMENTS:  All plans, drawings, reports, manuals, specifications, test data or other documents or information prepared by Subcontractor pursuant to this Agreement shall be furnished to Contractor and shall be the property of Contractor, and Contractor shall have the unlimited right to public, transfer, sell, license and use all or any part of such documents or information without additional payment to Subcontractor.


  1. DEDUCTIONS AND SET-OFF:  Any sums payable to Subcontractor shall be subject to all claims and defenses of Contractor or any of its affiliated companies, whether arising from this or any other transaction or occurrence, and Contractor may set-off and deduct against any such sums all present and future indebtedness of Subcontractor or any of its affiliated companies to Contractor or any of its affiliated companies.


  1. DEFECTIVE MERCHANDISE OR SERVICES:  Notwithstanding prior payment, Contractor reserves the right to return, at any time, for full credit at Subcontractor’s expense (including but not limited to cost of packing and transportation to and from source) and risk, all or any part of the Merchandise, Services or Work furnished by Subcontractor which is defective in material or workmanship or which differs in any way from any drawings, specifications and warranties contained in the Subcontract Documents or implied by law or which otherwise does not conform to the requirements of this Agreement, and Subcontractor shall have no right thereafter to cure such defects or failure to conform to such specifications and warranties or the Subcontract Documents.  Contractor reserves the right, but shall not be obligated, to repair any defects and debit from the Subcontractor any expenses involved when in Contractor’s sole judgment the cost of making such repairs would be less that the cost of replacement by Subcontractor or cancellation of this Agreement.  Contractor reserves the right, but shall not be obligated, to require Subcontractor to repair or replace, at Contractor’s option, defective or non-conforming Merchandise, Services or Work, at Subcontractor’s expense.  If Contractor returns defective Merchandise, Services or Work rejects non-conforming Work under this paragraph, Contractor may additionally cancel any remaining portion of this Agreement.


  1. INSPECTION:  Contractor may inspect and test the Merchandise, Services or Work during manufacture, construction, or preparation and shall have the right to inspect the Merchandise, Services or Work at the time of delivery and/or completion.  Multiple inspections shall not be grounds for objection by Subcontractor.  Notwithstanding previous inspections by Contractor, if defects or nonconformities for which Subcontractor is responsible under the terms of this Agreement are revealed by subsequent inspection, analysis, manufacturing operations, use or otherwise, Contractor may reject or revoke its acceptance of the Merchandise, Services or Work, in whole or in part, at any time after such defects or nonconformities are discovered or pursue its rights or remedies under this Agreement.


  1. PASSAGE OF TITLE:  Until Contractor has inspected the Merchandise, Services or Work furnished under this Agreement and has accepted it as being in conformity with this Agreement, Subcontractor’s delivery obligation shall not be deemed complete, nor shall title pass to Contractor, Subcontractor represents and warrants to Contractor that Subcontractor shall have good title to the Merchandise, Services or Work, free and clear of all liens at the time of Subcontractor’s delivery or furnishing of the Merchandise, Services or Work.


  1. CHANGES:  Contractor shall have the right to make changes in this Agreement, but no additional charge will be allowed unless authorized in writing by Contractor.  If such changes affect delivery or the price sought by Subcontractor, Subcontractor shall notify Contractor immediately.  There shall be no adjustment to the time of delivery or price to be paid for Merchandise, Services or Work unless and until Contractor signs a change order authorizing the same.


  1. CONTRACT AND JURISDICTION:  This Agreement and the effect of any contract formed pursuant hereto shall be construed and enforced in accordance with the laws of the State of Ohio.


  1. NON-WAIVER:  The failure of the Contractor to enforce at any time or for any period of time any of the provisions hereof shall not be construed to be a waiver of such provisions or the right of Contractor thereof to enforce each and every provision.


  1. MISCELLANEOUS:  (a) All rights granted to Contractor hereunder shall be in addition to, and not in lieu of, Contractor’s rights arising by operation of law; (b) any provisions of this Agreement which are typewritten or handwritten by Contractor shall supercede any contrary or inconsistent printed provisions; (c) no modification of the terms of this Agreement shall be valid unless in writing and signed by Contractor; (d) should any of the provisions of this Agreement be declared by a court of competent jurisdiction or any arbitrator to be invalid, such decision shall not affect the validity of any remaining provisions; (e) all of the terms herein shall apply to additional quantities of Merchandise, Services or Work ordered by Contractor except to the extent covered by a new Agreement; (f) this Agreement, together with any information or documents incorporated herein by reference, shall be deemed to contain the entire Agreement, between Contractor and Subcontractor and to constitute the complete and exclusive expression of the terms of the agreement, all prior or contemporaneous written or oral agreement or negotiations with respect to the subject matter hereof merged herein.

  2. CLAIMS:  Subcontractor agrees that is shall not be entitled to recover any damages from Contractor on account of claims for additional compensation, changes, delays, hindrances, interferences, lost productivity, or other impact damages of whatever kind or description unless and until Contractor recovers and collects such damages form Contractor’s customer.  Such recovery and collection from Contractor’s customer are an absolute condition precedent to Subcontractor’s right of recovery from Contractor.  Contractor shall function as a conduit for Subcontractor’s claims, and Subcontractor shall be obligated to compensate Contractor for all costs and expenses, including legal and consulting fees and administrative expenses, that Contractor incurs to present Subcontractor’s claims to the Contractor’s customer for consideration of payment or to arbitrate, mediate, or litigate such claims.  Subcontractor shall furnish all required testimony and documentation to support its claims.  Contractor assumes no fiduciary responsibility for prosecution and recovery on Subcontractor’s behalf.  In the event that Contractor recovers and collects damages from Contractor’s customer on account of Subcontractor’s claims through negotiation, litigation, mediation, or arbitration, then Contractor shall tender to Subcontractor the amount actually recovered and collected less the cost of prosecution, and administration, and Subcontractor shall accept that amount as payment in full for its claims and damages releasing Contractor from any additional liability or damages on the claims.  If the claim is denied or the amount claimed or recovered is not collected, the Subcontractor shall release Contractor from any and all claims and damages.


  1. DISPUTES:  At the sole option of Contractor, any and all claims, disputes, controversies, demands, and causes of action of whatever nature, kind or description arising from or relating to this Agreement, including without limitation contract, equity, tort or legal claims, and further including without limitation claims relating to rights of payment or interpretations hereof, shall be submitted to mandatory and binding arbitration in the Cleveland Tribunal of the American Arbitration Association in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association.  Contractor shall have the right, at its option, to join the consultants, contractors, subcontractors, suppliers, vendors or other third parties supplying services or materials in furtherance of the project, with whom Contractor has an agreement to arbitrate, as a party to any arbitration commenced pursuant to paragraph 31 of this Agreement.  Contractor also shall have the right, at its option, to join Subcontractor in any arbitration proceeding between the Contractor and the Contractor’s customer, or Project owner.  The decision and Award of the Arbitrator(s) shall be final and binding on the Contractor and Subcontractor, and the decision and Award may be reduced to judgment and enforced in any court of competent jurisdiction.  This agreement to arbitrate shall be specifically enforceable under the Ohio Arbitration Act and the Federal Arbitration Act.  The arbitrator(s) shall decide any issues relating to waiver of rights or timeliness of claims.


  1. PRECEDING WORK:  Subcontractor, before beginning the Work, shall carefully examine the work of others which may affect its Merchandise, Services or Work, determine whether it is in a fit and ready and suitable condition for the proper and accurate performance of the Work and furnishing of the Merchandise or Services, use all means necessary to discover defects in such other work, and notify Contractor in writing of any claimed deficiencies which may affect the work or merchandise or services.  If such notice is not given, all such work shall be deemed acceptable to Subcontractor.  In case of a dispute as to whether such other work is deficient, Subcontractor nevertheless shall proceed immediately with the Work when notified by Contractor to proceed.


  1. CLEAN-UP AND PROTECTION OF WORK:  Subcontractor at all times shall keep the Project and premises free from rubbish, debris and obstructions caused by its operations (including surplus materials, crates, and packing, etc. brought to the premises by Subcontractor or by others for the benefit of Subcontractor).  At the time of completion of the Work and furnishing of the Merchandise or Services in each area.  Subcontractor shall leave the area “broom clean” and shall remove all of its tools, equipment, scaffolding, and surplus materials.  Subcontractor shall not damage the work of others by its operations and shall repair or pay the cost of repairing any such damage done by Subcontractor or Subcontractor’s employees, agents, representatives, and lower tiers.


  1. DAMAGE AND DESTRUCTION:  Subcontractor shall cover at all times, adequately protect the Merchandise, Services or Work from damage until final acceptance by Contractor’s customer and shall safely store and protect its own materials furnished by others.  Subcontractor shall be responsible for any damage to or destruction of the Merchandise, Services or Work, and any other equipment, tools, and personal property at the premises, whether owned, rented or used by Subcontractor or anyone performing any of the work.  Subcontractor at its expense shall, as directed by Contractor, replace, repair, or restore any Merchandise, Services or Work thereof which are damaged or destroyed, whether such destruction to damage results from acts of God, fore, public enemy, civil commotion, vandalism, acts of omission or commission by any person, firm, or corporation.  Risk of loss with respect to Merchandise, Services or Work shall remain with Subcontractor until final acceptance of the completed work and the Merchandise, Services or Work.  Until such final acceptance, any damage or destruction of the Merchandise, Subcontractor shall make Services or Work, however caused, good at no extra cost to Contractor.  Such rework at Subcontractor’s expense shall not preclude Subcontractor from making a claim under any insurance maintained for the benefit of Subcontractor, but the right to make or the pendency of such claim shall not give cause to Subcontractor to delay the commencement or completion of such rework.


  1. SAFETY:  Subcontractor shall require its employees at the premises to wear and use safety and health equipment, to work in harmony with others working at the premises, and to comply with the Contractor’s or Contractor’s customer’s regulations, and rules and regulations imposed by law, covering working conditions.  Contractor shall have the right to furnish any safety or health equipment that Subcontractor fails to provide promptly, and Subcontractor shall upon demand pay Contractor’s cost thereof plus 20% for Contractor’s overhead and other indirect costs.  Subcontractor shall indemnify Contractor for fines, penalties and corrective measures, and damages, and shall reimburse Contractor for costs and expenses, including attorney fees, which result from acts of commission or omission by Subcontractor or its subcontractors or vendors or their assigns or their respective employees and agents in failing to comply with such safety rules and regulations.  Subcontractor, immediately after the occurrence of each accident involving injury to or death of any person or damage to property on the Premises or in any way relating to the Work, merchandise, or services, shall deliver to Contractor a report thereof, that may be a copy of any accident report delivered to its insurance carrier.  Contractor’s standard safety policy and requirements are incorporated into this Agreement.


  1. LABORERS ON SITE:  Subcontractor’s employees shall be skilled in their trades.  Any employee of Subcontractor may be refused admittance to the premises or may be requested to leave the premises at any time by Contractor, and Contractor shall not be required to have or state any reason for such action.  In the event that any employee or employees of Subcontractor are so barred from the job, Subcontractor shall immediately replace such employee or employees with employees satisfactory to Contractor.  Should any workers performing the work engage in a strike or other work stoppage or cease to work due to picketing or a labor dispute of any kind, Contractor may, at its option and without prejudice to any other remedies it may have, after forty-eight (48) hours written notice to Subcontractor, provide any such labor and deduct the cost thereof from any monies then due or thereafter to become due Subcontractor.  Further, Contractor may at its option, without prejudice to any other remedies it may have, terminate this Agreement, and shall have the right to enter upon the premises and take possession, for the purpose of completing the work, and the furnishing of the merchandise or services and all of Subcontractor’s materials, tools and equipment thereon and to furnish the merchandise or services and complete the work either with its own employees or other subcontractors; and in case of such termination by Contractor, Subcontractor shall not be entitled to receive any further payments under this Agreement or otherwise but shall nevertheless remain liable for any damages that Contractor incurs.  If the expenses incurred by Contractor in completing the Work shall exceed the unpaid balance due Subcontractor, Subcontractor shall pay the difference to Contractor, together with any other damages incurred by Contractor as a result of Subcontractor’s default.


  1. RESERVED GATES:  Reserved gates may be established on the premises.  If established, non-union firms and their subcontractors, employees, suppliers, and material handlers shall utilize Entrance No. 1 and union firms, and their subcontractors, employees, suppliers, and material handlers shall utilize Entrance No. 2.  These entrances, if established, shall not be misused.  The management of Subcontractor and its subcontractors, suppliers, and material men, as well as all other employees shall also observe these entrances.  In the event that Subcontractor violates the provisions of this paragraph, Contractor shall have the right, without prejudice to any other rights or remedies it may have, to terminate this Agreement and exercise the remedies provided in Paragraphs 14 or 18 herein, or elsewhere in this Agreement.


  1. UNION CONTRACTS / PREVAILING WAGE:  Subcontractor shall be bound by the terms, conditions, and wage rates contained in any and all of the collective bargaining agreements between Contractor and any union, which are incorporated by reference into this Agreement.  Wage rates and benefits paid to employees of Subcontractor and its lower tiers at the work site shall be no less than the prevailing wage rates in the locality where the work is performed or otherwise applicable to the Project.


  1. BONDS:  Subcontractor shall furnish to Contractor, if required by Contractor, a payment and performance bond in accordance with the requirements of the Subcontract Documents, on a form and from a surety acceptable to the Contractor.

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