4-Attach E - McKinstry Sample Subcontract.pdf

5005 3rd Ave S, Seattle, WA 98134 Page 1 of 33

McKinstry Co, LLC

Sample Subcontract

This Subcontract is entered into as of August 8, 2017 (“Effective Date”) by and between McKinstry Co, LLC (“McKinstry”) and Sample Subcontractor (“Subcontractor”). Subcontractor is further identified as:

Sample Subcontractor Contact: N/A Address Phone: XXX-XXX-XXXX City, N/A Zip Code E-mail: N/A

Subcontractor operates as a: {{*comment1_es_signer1 }}

(Sole Proprietorship, Partnership, Corporation, LLC, Other)

Subcontractor License Number(s) {{*comment2_es_signer1 }} Professional License Number(s) {{*comment3_es_signer1 }} Federal Employer ID Number (EIN) {{*comment4_es_signer1 }} State Employer ID Number {{*comment5_es_signer1 }}

WHEREAS, McKinstry and its Customer or Customers (“Customer”) have entered into or may enter into an agreement or agreements (“Prime Contract”) related to a project (“Project”) described in part as follows; and

Project Name: McKinstry Job Name

Project Address: Job Site Address Project City, State, Zip Code: Job Site City, State and Zip Code

McKinstry Contact: McKinstry Contact Name E-mail Address: McKinstry Contact E-mail Address

WHEREAS McKinstry desires to hire Subcontractor to provide services, labor, equipment, materials, and/or supplies related to the Project; and Subcontractor desires to provide services, labor, equipment, materials, and/or supplies related to the Project;

NOW THEREFORE, in consideration of the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, McKinstry and Subcontractor agree as follows:

SCOPE OF WORK

Subcontractor shall perform the scope of work described in the Scope of Work (“Work”). Subcontractor assumes toward McKinstry and Customer all obligations and responsibilities that McKinstry assumes toward Customer under the Prime Contract, incorporated herein by this reference, to the extent related to the Work.

SUBCONTRACT PRICE

Contractor agrees to pay the Subcontractor the following sum (“Price”) as full compensation for the Work to be performed by Subcontractor under this Subcontract.

Amount Type: Amount: $ Amount

RETENTION

Retention in the following percentage will be withheld until final completion of the Work: Retention %

Subcontract #:

SUBSTANTIAL COMPLETION DATE

Subcontractor shall achieve substantial completion by Date

PREVAILING WAGE AND CERTIFED PAYROLL

If required, Subcontractor shall pay prevailing wages and comply with all certified payroll requirements related to the Work.

THE PAGES THAT COMPRISE THIS SUBCONTRACT SET FORTH MATERIAL TERMS OF THIS

SUBCONTRACT AND ARE INCORPORATED HEREIN BY THIS REFERENCE. SUBCONTRACTOR AGREES TO

COMPLY WITH THE PROVISIONS OF ALL PAGES.

Each person signing this Subcontract represents and warrants that he or she has the authority to bind the party for whom he or she signs.

IN WITNESS WHEREOF, the parties hereto have executed this Subcontract as of the Effective Date.

McKinstry Co, LLC Sample Subcontractor

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{{N_es_:signer1:fullname }}

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{{Sig_es_:signer1:signature }}

{{Ttl_es_:signer2:title }}

{{Ttl_es_:signer1:title }}

{{Dte_es_:signer2:date }}

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General Terms and Conditions

Construction

1. Performance of Work

Subcontractor shall furnish all services, labor, equipment, materials, supplies, freight, packaging, hardware, fasteners, fixtures, tools, layout, engineering, value engineering, detailing, equipment, scaffolds, hoisting, administration, supervision, transportation, warehousing, storage and other facilities, permits, and all other items and services necessary for the proper and complete performance and acceptance of the Work. Subcontractor shall confine operations to areas permitted by license, permit, order, regulation, ordinance, code, statute, and/or policy; not unreasonably affect other use of or operations at the Property; perform the Work to completion diligently, expeditiously and with adequate forces; use its best efforts to coordinate the design, sequence, timing, and delivery of Work in order to prevent delay in the orderly and sequential delivery of work by other entities on the Project; return the Property to its former condition prior to completion of the Work; and comply with all reasonable directives issued by McKinstry from time to time. Subcontractor shall perform the Work with a standard of care that is at least equivalent to the standard of care ordinarily used by members of the Subcontractor’s trade or profession under similar conditions in the same locality as the Project, or as required under this Subcontract, or as required under the Prime Contract, or as required by law, whichever standard of care is greater. Subcontractor accepts the totality of conditions that may impact the Work, including but not limited to the nature and location of the Work and unknown site conditions that may be encountered in the performance of the Work, and the Subcontract price accounts for these issues. Subcontractor is responsible for on-time completion of the Work, and shall bear all costs of ensuring such completion.

2. Subcontract Price

For full and complete performance of the Work, and subject to the provisions of this Subcontract and the Prime Contract, McKinstry shall pay Subcontractor the Subcontract price (“Price”). The Price includes but is not limited to, all applicable wages, fringe benefit costs, material costs, equipment costs, delivery and distribution costs, storage costs, taxes, insurance costs, permit and license fees, royalties, home and field office overhead and general and administrative costs and all other amounts necessary to complete the Work, irrespective of when the Work is performed, or when such costs are incurred or billed.

3. Compliance with Law

Subcontractor shall comply with applicable law, license, permit, order, regulation, ordinance, code, statute and any other legal requirement related to the Work. Subcontractor shall obtain and maintain all licenses and permits pertaining to activities engaged in by Subcontractor, including without limitation licenses and permits required to perform the Work except to the extent actually obtained and maintained by McKinstry. If Subcontractor fails to comply with any law, license, permit, order, regulation, ordinance, code, statute and/or any other legal requirement, Subcontractor shall bear any and all associated costs, shall be responsible for any penalties incurred, and shall indemnify McKinstry and Customer for damages caused by Subcontractor’s failure.

Subcontractor shall pay all taxes, tariffs, and public charges of every kind related to the Work including, but not limited to, amounts associated with services, labor, equipment, materials, and supplies. Subcontractor shall comply with all prevailing wage requirements applicable to the Work, including the Davis-Bacon Act and state laws commonly called little Davis-Bacon laws, and McKinstry may send related information to Subcontractor under separate cover. If this Subcontract is for work on a federal project, there may be certain FAR, DFAR, DEAR and other federal law requirements that apply to the Work, and Subcontractor agrees that it is fully aware of all such requirements and that it shall fully comply with all such requirements.

4. Independent Contractor

Subcontractor is an independent contractor and is not an agent of McKinstry or Customer. McKinstry and Customer shall in no way be liable as an employer to or on account of any of the employees of Subcontractor.

5. Subcontractor's Employees

Subcontractor shall comply with every license, permit, order, regulation, ordinance, code, statute, and any other legal requirement related to Subcontractor’s employees, including but not limited to wage rates, hours of labor, and employee labor protections. Subcontractor shall establish and enforce procedures and practices to ensure equal employment opportunity in recruiting, hiring, training, upgrading, promotions, transfers, layoffs, recalls, termination, compensation, working conditions, benefits, and privileges, among other things.

6. Insurance

Subcontractor shall submit insurance documentation in compliance with the insurance exhibit attached to this Subcontract, if any, prior to starting Work.

7. Bonds

Subcontractor shall obtain and maintain performance and/or payment bonds, or other bonds, if and as directed by McKinstry.

8. Safety

Subcontractor shall comply with the safety exhibit attached to this Subcontract, if any.

9. Professional Conduct

Subcontractor shall at all times strictly enforce a professional, drug-free, harassment-free, and profanity-free workplace, including compliance with related policies, including reasonable dress codes, as directed by McKinstry. Subcontractor shall immediately remove from the Work and any Project site any person who is non-compliant with the foregoing requirements. McKinstry shall have sole discretion to determine whether Subcontractor is in compliance with the foregoing requirements, and shall have sole discretion to require immediate removal of any person for non-compliance.

10. Lower Tier Subcontractors

Subcontractor shall not further subcontract any part of the Work without McKinstry's prior written consent. McKinstry’s consent for Subcontractor to use a lower tier subcontractor shall not create any contractual relationship between any lower tier subcontractor and McKinstry. Subcontractor shall require lower tier subcontractors to agree to and comply with this Subcontract and the flow down provisions of this Subcontract. Subcontractor is entirely and ultimately responsible for compliance with the provisions of this Subcontract and for any part of Work that is performed by a lower tier subcontractor.

11. Borrowed Equipment

As consideration for the use of McKinstry equipment if permitted by the McKinstry site superintendent, Subcontractor: agrees that McKinstry makes no representation or warranty regarding the condition or suitability of equipment for any intended use; assumes full and complete responsibility for the use of the equipment; will ensure that only a competent user will be permitted to use the equipment and only after fully inspecting the equipment; shall not modify the equipment; and shall be responsible for all claims, demands, lawsuits, losses, expenses and/or liabilities that arise from its use of the equipment. McKinstry has no obligation to let Subcontractor use McKinstry equipment.

12. Acceptance of Work

McKinstry shall in its sole reasonable discretion determine whether the Work and any part of the Work complies with Subcontractor’s obligations under this Subcontract.

13. Payments

Subcontractor shall submit to McKinstry applications for payment and releases at such reasonable times as to enable McKinstry to timely apply for and obtain payment from Customer. Each application for payment and release shall be in the form of the exhibit attached to this Subcontract. By applying for payment, Subcontractor covenants that there are no Claims that have not been presented to McKinstry prior to the date of the payment application, and that any unpresented Claims are waived and released. McKinstry shall withhold retainage from each payment in an amount as provided for in this Subcontract. McKinstry may backcharge Subcontractor for deficiencies in the Work or any other work with McKinstry, or for Subcontractor’s non-compliance with any of its other obligations under this Subcontract or any other subcontract or purchase order with McKinstry. This is a pay-when-paid Subcontract. Subcontractor will be paid for the portion of Work completed by Subcontractor after McKinstry is paid by Customer for that portion of the Work. Prior to receipt of such payment by McKinstry, Subcontractor and its lower tier subcontractors and vendors shall not take any action against any payment bond related to such payment, and Subcontractor will defend and indemnify McKinstry for any such action taken by any of them. If Subcontractor fails to comply with any obligation under this Subcontract, including but not limited to insurance obligations, McKinstry may withhold payment until Subcontractor complies with such obligation. All payments received by Subcontractor shall be held in trust in favor of Subcontractor’s lower tier subcontractors, vendors, laborers, materialmen, governmental authorities and all others who are legally entitled to claim a lien on the Property or against any retainage or bond. Upon request from McKinstry, Subcontractor shall promptly provide a statement in writing setting forth what amounts, if any, are due or payable to lower tier subcontractors, vendors, laborers, materialmen, and others for labor, fringes, taxes, materials, equipment or supplies in connection with, or arising out of the Work and McKinstry may withhold from any payment, partial or final, otherwise due under this Subcontract, such sums as McKinstry reasonably may determine are necessary to secure and protect McKinstry, Customer, or the Property from liens and claims that may be asserted against them. If McKinstry determines that Subcontractor is obligated to pay, and has failed or may fail to pay, an entity to whom Subcontractor is obligated in connection with the Work, then McKinstry may deduct the amount of the obligation from payments made to Subcontractor. McKinstry reserves the right to pay Subcontractor and its lower tier subcontractors via joint check. Subcontractor shall make no assignment of any payments otherwise due under this Subcontract without the express written acceptance of any assignee to the provisions of this paragraph and this Subcontract, and prior approval by McKinstry of the assignment. Payments to Subcontractor are advances and are subject to adjustment by McKinstry at any time prior to final payment for errors, overpayment, or McKinstry’s good faith determination that the remaining balance of payments owed may be insufficient to ensure completion of Work covered by this Subcontract or to pay lien, retention, or bond claims.

14. Warranties

Subcontractor warrants to McKinstry and Customer that: the Work will conform to the requirements set forth in this Subcontract; shall be of a high grade, nature, and quality and free from defects; and will not infringe on any copyright, patent, trade secret, or other proprietary right held by any third party.

Subcontractor warrants the Work, including materials and labor, for 1 year from final completion unless otherwise provided elsewhere in this Subcontract, and Subcontractor will correct all deficient aspects of the Work during the warranty period at its sole expense. Subcontractor will transfer all manufacturers’ warranties to McKinstry.

15. Confidentiality

McKinstry may disclose to Subcontractor, orally or in writing, or Subcontractor may otherwise obtain, through observation or otherwise, confidential and proprietary information (“Confidential Information”). Confidential Information shall mean all information, unless specifically identified by McKinstry as non-confidential, regardless of how communicated or stored, concerning McKinstry, Customer, the Project, the Prime Contract, or the Work, including, without limitation, confidential or proprietary information, trade secrets, data, drafts, documents, communications, plans, know-how, negative know-how, formulas, improvements, designs, estimates, calculations, test results, specimens, schematics, drawings, tracings, studies, specifications, surveys, facilities, photographs, documentation, software, equipment, processes, programs, reports, orders, maps, models, agreements, ideas, methods, discoveries, inventions, patents, concepts, research, development, and business and financial information. Confidential Information shall not include that information defined as Confidential Information above that: (a) has been made public voluntarily by the Party to whom such information belongs; (b) Subcontractor has received, or later receives, separately from a source not under an obligation of confidentiality; (c) has otherwise become publicly available without violation of any obligation of confidentiality or other obligation to the Party to whom such information belongs or under law; or (d) Subcontractor has independently developed. Subcontractor acknowledges and agrees that disclosure of the Confidential Information would severely affect McKinstry and provide the recipient of the Confidential Information with a substantial and unfair competitive advantage. Subcontractor shall: (i) hold Confidential Information in strict confidence and not disclose Confidential Information to third parties other than those lower tier subcontractors that (a) require disclosure for performance of their obligations on the Work, and (b) have agreed in writing to be bound by the requirements of this Subcontract;

(ii) protect, and cause all lower tier subcontractors to protect all Confidential Information from disclosure; and (iii) use Confidential Information only in furtherance of the Work. These covenants shall survive in perpetuity.

16. Publicity

Subcontractor shall not publish or use in any advertising, marketing, sales or other promotional material any reference to McKinstry, Customer, the Project, or this Subcontract, including trademarks, logos, or copyrighted material.

17. Records

Subcontractor shall retain one set of copies of documents and other information that substantiate Subcontractor’s work on, and billings for, the Work (“Records”). Subcontractor shall make Records available for inspection and/or audit by McKinstry at a reasonable location during normal business hours, for a period equal to the statute of repose, or statute of limitation, of the state where the Work is performed, whichever is later. If an inspection and/or audit of the Records discloses an overpayment to Subcontractor, then Subcontractor shall refund the overpayment. If an overpayment is attributable to overbilling by Subcontractor, then Subcontractor shall also reimburse McKinstry for the reasonable costs of the inspection and/or audit.

18. Intellectual Property

Subcontractor retains all right, title, and interest in intellectual property that it developed prior to and outside of this Subcontract, but grants to McKinstry an unconditional, unlimited, perpetual, fully paid, worldwide, irrevocable, transferrable license to use any such information and material to the extent that it is incorporated into the Work. Plans, designs, specifications, drawings, materials, exhibits, reports, memoranda, studies, discoveries, formulae, ideas, improvements, inventions, methods, models, processes, techniques, findings, conclusions, recommendations, diagrams, specifications, data, databases, documents, pamphlets, advertisements, books, magazines, surveys, computer programs, software, software code, usage data, films, tapes, sound reproductions, patent rights, copyrights and other intellectual products, information, and materials created by Subcontractor in the performance of the Work (collectively the “Intellectual Property”) are “work made for hire”. McKinstry owns all right, title, and interest in and to all Intellectual Property created by Subcontractor in the performance of the Work. To the extent any of Subcontractor’s rights in the Intellectual Property are not “work made for hire”, or are not subject to assignment hereunder, including without limitation any moral rights, Subcontractor hereby irrevocably and unconditionally waives all enforcement of such rights and transfers all right, title, and interest in the Work to McKinstry. If the Prime Contract requires McKinstry to comply with specific intellectual property requirements, whether express or implied, this Subcontract is modified so that McKinstry will be able to comply with the requirements of the Prime Contract.

19. Liens

To the fullest extent allowed by law, Subcontractor shall not pursue or maintain any mechanic’s lien, equitable lien, payment or performance bond claim, lis pendens, or UCC filing (individually and collectively “Lien”) without first pursuing to completion all dispute resolution procedures provided for in this Subcontract. If Subcontractor proceeds contrary to the foregoing sentence, Subcontractor will cause any such Lien to be satisfied, removed, released, dismissed, and discharged within 5 business days after written demand from Customer or McKinstry or longer if required by law. Subcontractor shall bear all reasonable attorneys’ fees, costs, and expenses incurred by McKinstry or Customer related to investigating, resisting, releasing, or settling any such matter, and such amount may be deducted by McKinstry from funds otherwise due to Subcontractor. To the fullest extent allowed by law, Subcontractor subordinates its Lien rights to all construction financing and permanent financing related to the Work and/or Project.

20. Limitation of Liability

NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR ANY CONSEQUENTIAL, INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, OR SIMILAR, DAMAGES OR LOSSES, INCLUDING LOSS OF PROFITS, ARISING OUT OF OR RELATING TO THIS SUBCONTRACT, WHETHER BASED IN CONTRACT OR TORT OR ANY OTHER THEORY, EVEN IF A PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, EXCEPT TO THE EXTENT THAT THE PRIME CONTRACT IMPOSES LIABILITY FOR SUCH

DAMAGES.

21. Indemnification

Each party shall indemnify, defend, and hold harmless the other party and its members, directors, officers, agents, employees, and affiliated entities against actions and damages including loss, liability, expense, and attorneys’ fees awarded by a court of competent jurisdiction, for third party claims for damages caused by the indemnitor or by entities for which the indemnitor is responsible, in connection with the Work, but only to the extent of the fault of the indemnitor and/or the entities for which the indemnitor is responsible; provided, however, that if the Prime Contract imposes a greater obligation then such greater obligation shall apply. Such obligation shall not be construed to negate, abridge or reduce other rights or obligations of indemnity that would otherwise exist as to a party or person described in this section. In claims against any person or entity indemnified under this section by an employee of subcontractor or anyone directly or indirectly employed by subcontractor or anyone for whose acts subcontractor may be liable, subcontractor’s indemnification obligation under this section shall not be limited by a limitation on amount or type of damages, compensation or benefits payable by or for subcontractor under workers’ compensation acts, disability benefit acts or other employee benefit acts. By signing this subcontract, subcontractor specifically and expressly waives any immunity that may be granted it under industrial insurance and/or workers compensation laws. The parties acknowledge that the foregoing waiver of limitation was mutually negotiated. The foregoing indemnification obligations shall survive termination, expiration, and/or full performance of the Work and/or this Subcontract and shall not be limited by any amount or type of insurance coverage.

Subcontractor waives all defenses based on statutes of limitation or repose to the extent necessary to give effect to the foregoing obligations.

22. Claims

Subcontractor may request payment for an amount Subcontractor believes is due to it, or for additional time to perform, under this Subcontract (“Claim”) only pursuant to the following procedure. Within five (5) days after the occurrence giving rise to the Claim, or within enough time for McKinstry to reasonably process and submit the Claim request to Customer pursuant to the requirements of the Prime Contract, whichever is sooner, but in no case more than fifteen (15) days after the occurrence giving rise to the Claim, Subcontractor shall provide McKinstry with a written and signed statement of claim (“Statement of Claim”) which shall describe with particularity the occurrence giving rise to the Claim, detailed and specific identification of all factual information, contractual provisions, calculations of all components and subcomponents upon which the Claim is based, the reasons why the Claim should be accepted, and Subcontractor’s requested resolution. McKinstry shall determine whether to accept or reject the Claim, at its sole discretion, and shall have no obligation to accept a Claim that arises from events, circumstances, acts, or omissions for which McKinstry is not responsible. Subcontractor’s failure to comply with the requirements of the Prime Contract, this Subcontract, or the foregoing provisions of this paragraph, shall be an absolute bar to Subcontractor’s Claim.

23. Change Orders

The Scope of Work, Price, and time for performance may be changed pursuant to a written instrument signed by an authorized signer of each party (“Change Order”). McKinstry may propose a Change Order at any time without regard to the following provisions of this paragraph and Subcontractor shall respond to such proposal within three (3) days. Subcontractor may propose a Change Order only pursuant to the following procedure. Within five

(5) days after the occurrence giving rise to the Claim, or within enough time for McKinstry to reasonably process and submit the Claim request to Customer pursuant to the requirements of the Prime Contract, whichever is sooner, but in no case more than fifteen (15) days after the occurrence giving rise to the Claim, Subcontractor shall provide McKinstry with a written and signed proposed Change Order which shall describe changes in the Scope of Work, Price, or time for performance proposed by Subcontractor. McKinstry may accept or reject such proposal at its sole discretion. Subcontractor’s failure to comply with the requirements of the Prime Contract, this Subcontract, or the foregoing provisions of this paragraph, shall be an absolute bar to Subcontractor’s Change Order request.

24. Change Directives

The Scope of Work and time for performance may be changed pursuant to a written instrument signed by an authorized signer of McKinstry (“Change Directive”). Subcontractor, upon receipt of the Change Directive, shall perform the work as directed in the Change Directive. Subcontractor shall give written notice to McKinstry of any request for an increase in Price or time to perform that work within five (5) days after receipt of the Change Directive.

Subcontractor's failure to give timely notice of such claim shall be an absolute bar to such claim. Otherwise, after receipt of the claim from Subcontractor, McKinstry and Subcontractor will attempt to reasonably adjust the Price or time to perform and they shall memorialize the resolution via a Change Order signed by an authorized signer of each party. Subcontractor shall not be required to comply with a Change Directive if compliance would impose a significant and unreasonable burden on Subcontractor.

25. Takeover

If McKinstry, after consultation with Subcontractor, determines that Subcontractor will be reasonably unable to comply with any material obligation under this Subcontract, including but not limited to performing Work that is not acceptable, falling behind schedule, failure to pay vendors or lower tier subcontractors, violation of law, or in case of termination, then McKinstry shall have the right to take over the Work upon three (3) days written notice to Subcontractor and Subcontractor’s failure within that time to clearly demonstrate its ability to comply with such obligation under this Subcontract. In such case, McKinstry shall have the right to complete the Work at the cost and expense of Subcontractor, including the cost to McKinstry of completing the Work in conformity with this Subcontract, reasonable overhead and profit, and costs incurred under the terms of the Prime Contract including delay costs, and without prejudice to any other rights and remedies available to McKinstry.

26. Termination

A) Either Party may terminate this Agreement for material breach by the other Party. Termination is in addition to any other remedies that may be available to the non-breaching Party. B) Additionally, McKinstry may terminate this Subcontract for its convenience and without cause. Upon receiving such notice, Subcontractor shall, unless the notice directs otherwise: (i) immediately discontinue the Work on the date specified in the notice; (ii) place no further orders for, including but not limited to, services, labor, equipment, materials, or supplies; (iii) if required by the notice, make every reasonable effort to procure cancellation of all existing orders or contracts upon terms satisfactory to McKinstry, or at the option of McKinstry, give McKinstry the right to assume Subcontractor’s rights and obligations under such orders or contracts, and (iv) do only such work as may be necessary to preserve and protect the Work already in progress and to protect material and equipment on the job-site or in transit thereto. Upon such termination for convenience at McKinstry’s election, Subcontractor will be entitled to payment for only: (a) the reasonable cost of the Work completed in conformity with this Subcontract; plus (b) such other costs actually incurred by Subcontractor as are permitted by the Prime Contract and approved by Customer and McKinstry; plus (c) pro-rated overhead and profit in the amount allowed in Prime Contract, or this Subcontract, whichever is lower, less (d) the amount of any payments made to Subcontractor prior to the date of the termination of this Subcontract, less (e) any costs incurred by McKinstry as a result of any breach by Subcontractor prior to termination. Subcontractor will not be entitled to any claim or lien against McKinstry or Customer for any additional compensation or damages in the event of such termination and payment, and Subcontractor waives any such claims, including loss of anticipated profit.

The provisions of this Subcontract, which expressly, or by their nature, survive final acceptance of the Work, will remain in full force and effect after any termination pursuant to this section. C) Additionally, McKinstry may terminate this Subcontract or suspend the Work for the same reasons Customer may terminate or suspend McKinstry under the Prime Contract. If the Prime Contract is terminated for the convenience of Customer, the termination settlement under this Subcontract shall be as provided in the Prime Contract. Subcontractor shall not be entitled to receive any greater amount than McKinstry may on behalf of Subcontractor recover from Customer for such termination. Subcontractor shall cooperate by timely providing a termination for convenience cost proposal, if requested by McKinstry.

27. Disputes

Except for breaches of the confidentiality or intellectual property provisions of this Subcontract, or as required under the Prime Contract, the Parties agree that the following process will be used to resolve any dispute between them. First, the Parties will attempt to negotiate a resolution. If a dispute remains unresolved more than thirty (30) calendar days after the commencement of negotiation and the Parties have not mutually agreed to extend the negotiation period, then the Parties shall submit the dispute to mediation. In mediation, the Parties shall mutually select a mediator, the cost of the mediator and other administrative costs shall be shared equally by the Parties, and each Party shall be responsible for its own costs and expenses. If any dispute remains unresolved more than sixty (60) calendar days after the commencement of mediation, and the Parties have not mutually agreed to extend the mediation period, then the dispute shall be resolved through binding arbitration. In binding arbitration, the Parties shall mutually select an arbitrator, the rulings and determinations of the arbitrator will be final and binding on the parties subject to any exceptions provided by applicable law, the arbitrator shall provide a written reasoned opinion in support of the arbitration award, and the non-prevailing Party shall reimburse the prevailing Party for all of its reasonable attorneys’ fees, costs, and expenses. The Construction Industry Arbitration Rules and Mediation Procedures of the American Arbitration Association shall apply to all mediation and arbitration proceedings. All negotiation, mediation, and arbitration proceedings and outcomes shall be treated as Confidential Information.

28. Non-Solicitation

Subcontractor shall not, so long as Subcontractor is engaged by McKinstry and for twelve (12) months after such engagement ends, directly or indirectly solicit or recruit any employee of McKinstry to leave his or her employment with McKinstry. The foregoing sentence does not apply if the McKinstry employee approaches Subcontractor of his or her own accord. Also, Subcontractor shall not directly or indirectly solicit or accept business from Customer or any of Customer’s affiliates for specific work, a specific project, or a specific job, that was introduced to Subcontractor by McKinstry.

29. Choice of Law, Venue

The validity, interpretation, and performance of this Subcontract shall be governed exclusively in accordance with and by the laws of the state in which the Work is performed. The venue for resolving any dispute shall be the county in which the Work is performed.

30. Flow Down

The Prime Contract is incorporated herein by reference. Subcontractor assumes toward McKinstry all obligations and responsibilities that McKinstry assumes toward Customer under the Prime Contract to the extent related to the Work. McKinstry assumes toward Subcontractor all obligations and responsibilities which Customer assumes toward McKinstry under the Prime Contract to the extent related to the Work. The Prime Contract has been made available, and remains available to Subcontractor, subject to redactions that McKinstry may make to it. The Prime Contract is Confidential Information. If a dispute arises between McKinstry and Customer, Subcontractor shall cooperate with McKinstry in resolving such dispute to the extent of Subcontractor’s Work. Subcontractor waives any applicable statutes of limitation and/or statutes of repose that would otherwise bar McKinstry from pursuing an action against Subcontractor to the extent Customer is not barred from pursuing such action against McKinstry. It is expressly understood and agreed that as to any and all claims asserted by Subcontractor against McKinstry arising from the actions or fault of Customer, McKinstry shall not be liable to Subcontractor for any greater amount than Customer is liable to McKinstry for the Work, less any markups or costs incurred by McKinstry. In case of conflict between the terms of this Subcontract and the Prime Contract, the Prime Contract controls.

31. Force Majeure

Neither Subcontractor nor McKinstry shall be considered in breach of this Subcontract to the extent that the Party’s performance is prevented by an event or events that are beyond the control of such Party, including but not limited to acts of God, fire, earthquake, flood, storm, war, rebellion, revolution, insurrection, riot, strike, nuclear contamination, and/or acts or threats of terrorism (“Force Majeure”) unless performance is required under the Prime Contract. Notwithstanding the foregoing, if Subcontractor has contracted to perform emergency-related Work, including but not limited to, business continuity or crisis management Work, Subcontractor shall not be excused from performance due to a Force Majeure event within the scope of the Work.

32. Notice

Any notice from Subcontractor to McKinstry shall be delivered by hand or certified mail to the McKinstry project manager and to Attn: General Counsel, McKinstry, 5005 3rd Ave S, Seattle, WA 98134. Any notice from McKinstry to Subcontractor shall be delivered to Subcontractor’s designated contact person, or to any location where Subcontractor regularly conducts business.

33. Non-Exclusivity

This Subcontract is non-exclusive. McKinstry may contract with other Subcontractors for the same or similar work.

34. Assignment

Subcontractor may not assign or transfer its rights and/or obligations under this Subcontract without prior written consent of McKinstry. Any change of fifty percent (50%) or more of the ownership of Subcontractor shall constitute an assignment by Subcontractor hereunder.

35. No Waiver

No waiver of a breach, failure of any condition, or any right or remedy contained in or granted by the provisions of this Subcontract shall be effective unless it is in writing and signed by the Party waiving the breach, failure, right, or remedy. No waiver of any breach, failure, right, or remedy shall be deemed a waiver of any other breach, failure, right, or remedy, whether or not similar, nor shall any waiver constitute a continuing waiver.

36. No Third Party Beneficiaries

There are no third party beneficiaries under this Subcontract or any portion thereof.

37. Severability, Survival

If any portion of this Subcontract shall be held invalid in whole or in part under any law, rule, regulation, or order, then such portion shall remain in effect only to the extent permitted, and the remaining portions of the Subcontract shall remain in full force and effect. Any invalid portions shall be substituted with an interpretation that most accurately reflects the Parties’ intentions.

38. Time of Essence

Time is of the essence in the performance and completion of the Work.

39. EPAct

Unless otherwise specified in this Contract, McKinstry is solely entitled to claim tax benefits available under section 179D of the Internal Revenue Code (EPAct) or its successor. Subcontractor agrees to promptly execute any inspection, certification and/or calculation documents prepared by McKinstry connected with tax related benefits related to the Work.

40. Waiver of Subrogation

The Parties waive all rights against each other for damages and losses to the extent covered by insurance.

41. Order of Precedence

The provisions contained in the documents that are part of this Subcontract are intended to be consistent, and shall be interpreted as such to the fullest extent possible. Except for provisions included in the scope of work or in an addendum to this Subcontract, in the event that there is any inconsistency or conflict among any of the provisions of this Subcontract, Subcontractor will comply with the provision that imposes the most stringent obligation on Subcontractor. Notwithstanding the foregoing sentence, any legal terms and conditions provided by Subcontractor to McKinstry, including those contained in proposal documents provided by Subcontractor, shall be ignored, disregarded, and of no force and effect.

42. Amendment

Except as otherwise provided in these General Terms and Conditions, this Subcontract may not be amended except pursuant to a written amendment signed by an authorized McKinstry signer.

43. Headings

The headings in this Subcontract are for purposes of reference only and shall not limit or define the meaning of the provisions under such headings.

44. Neutral Interpretation

This Subcontract shall not be interpreted or construed for or against either Party, but shall be interpreted and construed in a neutral manner.

45. Complete Agreement

This Subcontract embodies the entire agreement between the Parties and supersedes all prior negotiations, bid proposals, agreements and understandings related to the subject matter of this Subcontract. This Subcontract governs any work performed pursuant to a letter of intent, notice to proceed, or similar written agreement prior to this Subcontract being executed.

Invoicing, Payment, & Release

PLEASE FORWARD TO YOUR ACCOUNTING DEPARTMENT

SEND ALL INVOICES TO:

• Email all invoices to subinvoices@mckinstry.com no later than the 15th of each month in order for invoice amounts to be included in McKinstry’s payment request to our Client.

• If you do not have scanning capabilities, please mail to:

McKinstry Attn: Accounts Payable P.O. Box 24567 Seattle, WA 98124-0567

INVOICES MUST INCLUDE:

1. An invoice number

2. An invoice date

3. McKinstry Subcontract number

ALL INVOICES MUST BE ACCOMPANIED BY:

1. Pay Request – See attached form.

2. Lien Release – See attached form.

Failure to send all three documents may result in a delay of payment.

WE MUST HAVE THE FOLLOWING DOCUMENTS ON FILE PRIOR TO PAYMENT:

1. A signed Subcontract

2. Proof of proper insurance

RETENTION:

If your Subcontract designates a withholding of retention, please ensure that you include that retention withholding on every invoice submitted. When you have completed all work, you must submit the included Retention Release form to your McKinstry Point of Contact per project in order for retention to be released.

Invoices submitted 120 days or more after completion of work will not be processed for payment.

Subcontractor

Pay Request

From: Submit To:

subinvoices@mckinstry.com

Pay Request No:

Invoice No:

Date:

Project Name:

Period: From To

Complete to Date Amount % $

Original Subcontract Amount:

Change Orders Issued To Date Thru Change Order _______:

New Change Orders (list separately):

Change Order _______

Change Order _______

Change Order _______

Change Order _______

Subcontract To Date:

Less Work Previously Invoiced:

TOTALS THIS REQUEST

Gross Amount Due This Request:

Net Amount Due This Request:

Release

Subcontractor Name Subcontract Number

Subcontractor Address Project Name

Subcontractor Contact Name Project Address

Subcontractor Contact Phone Number McKinstry Contact

CONDITIONAL RELEASE

Subcontractor should execute this release if it has not yet received the payment(s) specified below.

Subcontractor does hereby acknowledge that upon receipt by

Subcontractor of payment(s) from McKinstry

□ in the sum of $_________________________, and/or

□ per the attached schedule of values and if payment is by check when the check has been properly endorsed and has been paid by the bank upon which it was drawn, this document shall become effective to release any and all claims, rights of lien, and Miller Act claims which

Subcontractor and its vendors, suppliers and sub-subcontractors have on the project to which the payment relates, including for labor, services, materials, and equipment, through the date that this release is signed. Subcontractor agrees that by accepting and in consideration for the above sum, Subcontractor will defend and hold McKinstry and Client harmless from any claims for payment from Subcontractor’s vendors, suppliers and sub-subcontractors and that the duty to defend shall include reimbursement for all costs and attorney fees incurred by counsel selected by McKinstry in connection with such defense.

Before any recipient of this document relies on it, the party should verify evidence of payment to the undersigned.

I CERTIFY, REPRESENT AND WARRANT THAT I HAVE

THE AUTHORITY TO BIND SUBCONTRACTOR TO THIS

RELEASE.

I CERTIFY UNDER PENALTY OF PERJURY THAT THE

ABOVE ARE TRUE AND CORRECT STATEMENTS.

For Subcontractor:

Signature

Printed Name

Title

Date

UNCONDITIONAL RELEASE

Subcontractor should execute this release if it has received the payment(s) specified below.

Subcontractor does hereby acknowledge that Subcontractor has received payment(s) from McKinstry

□ in the sum of $_________________________, and/or

□ per the attached schedule of values

Subcontractor does hereby release any and all claims, rights of lien, and Miller Act claims which Subcontractor and its vendors, suppliers and sub-subcontractors have on the above project to which the payment relates, including for labor, services, materials, and equipment, through the date that this release is signed. Subcontractor agrees that by accepting and in consideration for the above sum, Subcontractor will defend and hold McKinstry and Client harmless from any claims for payment from Subcontractor’s vendors, suppliers and sub-subcontractors and that the duty to defend shall include reimbursement for all costs and attorney fees incurred by counsel selected by McKinstry in connection with such defense.

I CERTIFY, REPRESENT AND WARRANT THAT I HAVE

THE AUTHORITY TO BIND SUBCONTRACTOR TO THIS

RELEASE.

I CERTIFY UNDER PENALTY OF PERJURY THAT THE

ABOVE ARE TRUE AND CORRECT STATEMENTS.

For Subcontractor:

Signature

Printed Name

Title

Date

Retention will not be released until your McKinstry Project Manager receives this form completed

Subcontractor Information:

Subcontractor Name

Subcontractor Address

Subcontractor City, State, Zip Code

Subcontract Number (located on your subcontract and/or subcontract change order)

RETENTION RELEASE

Equal Employment Opportunity

Subcontractor will comply with all legal requirements related to equal employment opportunity and non-segregated facilities, including compliance with Executive Order No. 11246, the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended, Section 503 of the Rehabilitation Act of 1973, as amended, the Americans With Disabilities act, Public Law 101 – 336, as amended, Executive Order 13201, and all other applicable federal, state, and local laws and regulations.

During the performance of this Subcontract, the Subcontractor agrees as follows:

1. The Subcontractor will not discriminate against any employee or applicant for employment because of race, creed, color, or national origin.

The Subcontractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, creed, color, or national origin. Such action shall include, but not be limited to the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Subcontractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by the contracting officer setting forth the provisions of this nondiscrimination clause.

2. The Subcontractor will, in all solicitations or advertisements for employees placed by or on behalf of the Subcontractor, state that all qualified applicants will receive consideration for employment without regard to race, creed, color, or national origin.

3. The Subcontractor will send to each labor union or representative of workers with which he has a collective bargaining agreement or other contract or understanding, a notice, to be provided by the agency contracting officer, advising the labor union or workers' representative of the Subcontractor's commitments under Section 202 of Executive Order No. 11246 of September 24, 1965, and shall post copies of the notice in conspicuous places available to employees and applicants for employment.

4. The Subcontractor will comply with all provisions of Executive Order No. 11246 of Sept. 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor.

5. The Subcontractor will furnish all information and reports required by Executive Order No. 11246 of September 24, 1965, and by the rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to his books, records, and accounts by the contracting agency and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and orders.

6. In the event of the Subcontractor's noncompliance with the nondiscrimination clauses of this contract or with any of such rules, regulations, or orders, this contract may be cancelled, terminated or suspended in whole or in part and the Subcontractor may be declared ineligible for further Government contracts in accordance with procedures authorized in Executive Order No. 11246 of Sept 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in Executive Order No. 11246 of September 24, 1965, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law.

7. The Subcontractor will include the provisions of Paragraphs (1) through (7) in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to Section 204 of Executive Order No. 11246 of Sept. 24, 1965, so that such provisions will be binding upon each subcontractor or vendor. The Subcontractor will take such action with respect to any subcontract or purchase order as the contracting agency may direct as a means of enforcing such provisions including sanctions for noncompliance: Provided, however, that in the event the Subcontractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the contracting agency, the Subcontractor may request the United States to enter into such litigation to protect the interests of the United States.

Compliance with 41 CFR 60-300.5(a). Subcontractor shall abide by the requirements of 41 CFR 60-300.5(a). This regulation prohibits discrimination against qualified protected veterans, and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified protected veterans.

Bonds

1. Performance Bond

Subcontractor shall obtain a performance bond in an amount equal to the Subcontract Price (“Price”). If the Price increases as a result of change orders or other modifications to the Subcontract, Subcontractor shall obtain a revised or new performance bond in an amount equal to the new Price.

2. Payment Bond

Subcontractor shall obtain a payment bond in an amount equal to the Subcontract (“Price”). If the Price increases as a result of change orders or other modifications to the Subcontract, Subcontractor shall obtain a revised or new payment bond in an amount equal to the new Price.

3. Surety

McKinstry reserves the right to approve or reject a surety selected by Subcontractor in connection with the above referenced bonds.

4. Documentation

Subcontractor shall promptly furnish an original of the above referenced bonds to McKinstry.

Prevailing Wage & Certified Payroll

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