Anaheim City Council
September 26, 2023

GENERAL CONDITIONS

GENERAL CONDITIONS

1. GENERAL PROVISIONS

1.1 DEFINITIONS.

Whenever the words defined in this Section, or pronouns used in their stead, occur in any part of the Agreement, they shall have the meaning herein given unless the context clearly indicates to the contrary.

Affidavit of Final Completion. A sworn affidavit from Design-Builder and all Design Team Members identified in the Agreement submitted to City in a form approved by the City that the Work Order Package has been completed in strict accordance with the Contract Documents, no lawful debts for labor or materials are outstanding, all requests for payment of undisputed funds are accurate, complete and final and no add itional compensation above the final payment is due under the applicable Work Order Package, there is no existing default by Design-Builder or pending claim by a third party, and, upon receipt of final payment, Design-Builder and its Subcontractors acknowledg e that City will be released from any claims or liability for additional sums on account of undisputed Work.

Agreement. When capitalized, means document signed by City and Design-Builder for performance of the Work, as amended from time to time, which se ts forth the rights and obligations of the Parties, including all exhibits and attachments.

Applicable Laws. All laws, st atutes, codes, ordinances, requir ements, rules, tariffs, development regulations and other regulations of governmental a uthorities having jurisdiction over the Project, including, but not limited to, the Anaheim Municipal Code, the City of Anaheim General Plan.

Application for Payment. Application for Payment means the Design-Builder's written request for payment as described in Section 9.2 herein.

As-Built Drawings. A set of drawings updated and marked to show deviations made during construction, details in the Work not previously shown, changes to existing conditions found to differ from those shown on existing drawings, and the actual installed position of equipment and fixtures.

Best and Final Offer. The Best and Final Offer means the Design-Builder's best and final offer for a Work Order Package.

Certificate of Final Acceptance. The formal written acknowledg ement issued by City to Design-Builder that the Work Order Package has been fully completed.

Certificate of Substantial Completion. The formal written acknowledgement issued by City to Design-Builder that the Work f or a Work Order Package has at tained Substantial Completion.

Change. Substitutions, alterations, additions or deletions in the Work.

Change Order. A written order implementing changes in the Work for which adjustments to the Work Order Package Price and Work Order Package Deadline, i f any, have been

agreed upon prior to the issuance of the change order.

Change Order Request. A document submitted at the Design-Builder’s own initiative to the City requesting that a Change Order be issued.

Change Notice. A document issued by City to Design-Builder detailing a proposed change in the Work, stating a proposed basis for adjustment, if any, i n the Work Order Package Price and Work Order Package Deadline.

Change Proposal. A proposal for a Change Order submitted by the Design-Builder to the City, describing revisions to the Work and the basis for adjust ment of the Work Order Package Price and Work Order Pa ckage Deadline, either in respon se to City’s Change Notice or at the Design-Builder’s own initiative in connection with a Change Order Request.

City. The City of Anaheim.

City Manager. The Person holding the position of City Manager for the City of Anaheim.

City Project Manager. The Person identified as such in the Work Order Package.

City Standards. The City Standards include the City’s Water Ser vices Standard Specifications, the Public Works Construction Standards and Planning/Building Standards, as modified and supplemented by the City.

Claim. A demand by Design-Builder for a time extension which is disputed by the City or payment of money or damages for work performed in connection wi th a Work Order Package that is disputed by the City.

Construction Documents. All technical drawings, shop drawings, working drawings, schedules, diagrams, specifications and samples, setting forth in detail the requirements necessary for construction of a Work Order Package project in a ccordance with the Contract Documents, approved by the City and incorporated into this Agreement after such approval. All amendments to the Construction Documents must be approved by City in writing prior to incorporation into the Agreement and prior to the construction of the Work affected by the change.

Contract Documents. The document s described in Article 1 of th e Agreement. A Work Order Package and a Proposal are included within the Contract Documents but only to the extent that it is applicable to a particular Work Order Package project.

City Council. The City Council of the City of Anaheim.

Day. As used throughout the Agreement the terms "Day" or "Days" mean calendar days unless otherwise specifically designated.

Design and Performance Criteria. Those minimum performance and quality standards provided to the Design-Builder by the City and identified in a Work Order Package.

Design-Build Competitors. Desi gn-Builder Competitors means thos e design-build contractors who have been awarded an agreement for the Project on November 10, 2020.

Design Documents. All drawings (including plans, elevations, s ections, details and diagrams), specifications, bill of materials, studies, surveys, reports, calculations, records and submittals necessary for the design of a Work Order Package project in accordance with the Contract Documents, following approval thereof by City and others as required by the Contract Documents.

Design-Build Team Members. The Subcontractors identified in th e Mandatory Subcontractor List and Proposer’s Declaration.

Design Team Members. The design Subcontractors identified in th e Mandatory Subcontractor List and Proposer’s Declaration.

Engineer. The Person designated by the Public Works Director as the Engineer for a Work Order Package.

Final Completion. The stage of performance when all Work for a Work Order Package has been completed in accordance with the Contract Documents including, without limitation, all correction or completion items noted in the Certificate of Subs tantial Completion. The determination of the date of Final Completion shall be made reasonably and in good faith by the City and shall be fixed in a Certificate of Final Acceptance issued by City.

Force Majeure. Failure of performance due to an uncontrollable force. The term “uncontrollable force” shall m ean any cause beyond the control of the party unable to perform, including but not limited to, failure of or threat of failure of facilities, flood, earthquake, storm, drought, fire, pestilence, lightning and oth er natural catastrophes, epidemic, war, riot, civil disturbance or disobedience, strike, labor dispute, labor or material shortage, sabotage, government priorities, restraint by court order or public authority and action or non-action by or inability to obtain the necessary authorization or approvals from any governmental agency or author ity (including any Governmenta l Approvals and approvals of the Division of the S tate Architect), which by the exercise of due diligence such party could not reasonably have been expected to avoid and which by exercise of due diligence has been unable to overcome. Notwithstanding the foregoing, a Force Majeure does not include (a) Tariffs, or (b) any cost and expense increase.

Governmental Approval. Any appr oval, authorization, certification, consent, exemption, filing, permit, registration, or ruling required to design and construct a Work Order Package project, excluding only environmental approvals under the California Environmental Quality and those approvals identified as the responsibility of the City in the Contract Documents.

Hazardous Materials. Has the meaning set forth in Section 3.1.3.

Mandatory Subcontractor List and Proposer’s Declaration. The Mandatory Subcontractor List and Proposer’s Declaration contained in a Proposal.

Milestone Dates. Has the meaning set forth in Section 3.8.1.

Modification. A modification is (1) a written amendment to the Contract signed by both Parties; (2) a Change Order signed by both Parties; (3) a Unila teral Time and Material Change Order issued by the City.

Notice to Proceed. The written notice given by City to Design-Builder which authorizes the

Design-Builder to commence performance of a Work Order Package.

Parties. The Parties to the Agreement, City and Design-Builder.

Person. Any individual, corporation, company, joint venture, association, partnership, trust or unincorporated organization.

Performance Criteria. Means the requirements for the Work, as determined by the Public Works Department, expressed in conceptual documents, performance-oriented preliminary drawings, outline specifications and other documents provided with a Work Order Package.

Preliminary Design Documents. P reliminary Design Documents are those documents approved by the City in writing in accordance with Section 5.6 of the Agreement.

Project Manager. The Person who Design-Builder has identified in a Proposal as the Project Manager for a particular Work Order Package.

Project Schedule. The schedule for performance of the Work Ord er Package to which Design-Builder has agreed to complete the Work. The Project Schedule shall be adjusted pursuant to the provisions of the Contract Documents.

Proposal. The Proposal means the Design-Builder's proposal submitted in response to a Work Order Package which the Cit y has awarded to Design-Builder . The Proposal also includes the Best and Final Offer. The Proposal shall form part of the Work Order Package and to the extent there are any conflicts between a Work Order Package and Proposal, the Work Order Package shall govern.

Public Works Construction Standards. The 2012 Standard Specifications for Public Works Construction (i.e., the "GreenBoo k" by the American Public Work s Association, the Associated General Contractors of California, the Engineering Contractors Association, the Southern California Contractors Association and BNi Publication s Inc., as modified and supplemented by the City.

Public Works Department. Means the Public Works Department of the City of Anaheim.

Record Documents. The documents described in Section 3.9 herein.

Recovery Schedule. A plan submitted by Design-Builder in the event the Work is lagging behind the critical path, demons trating Design-Builder’s propos ed plan to regain lost schedule progress and to achieve Substantial Completion in acco rdance with the requirements of the Contract Documents.

Request for Information. A document issued by the Design-Builder requesting information or clarification of the Contract Documents.

Scope of Work. A document include d within the Work Order Packag e containing a description of the Work and requirements for its performance, including, the Design and Performance Criteria and other requirements. The Scope of Work also contains the required materials, tools, and equipment for Work Order Package project.

Services. The term Services when used throughout the Contract D ocuments is

interchangeable with the term "Work."

Shop Drawings. Shop drawings shall mean drawings, diagrams, performance curves, data sheets, schedules, templates, patterns, reports, calculations, instructions, measurements, and similar information, for the Work furnished by or on behalf of Design-Builder to illustrate a portion of the Work.

Site. Means the location of that portion of the Project subject to a Work Order Package awarded to the Design-Builder.

Subcontractor. Any Person who enters into a subcontract with Design-Builder to perform any part of a Work Order Package. Unless otherwise specified, Subcontractor excludes suppliers, manufacturers and distributors.

Substantial Completion. The stage in the progress of the Work for a Work Order Package when the Work or designated portion thereof is sufficiently complete in accordance with the Contract Documents so the City c an occupy or utilize the Work f or its intended purpose provided, however, that Substantial Completion shall not occur until the requirements of Section 9.4 herein have been satisfied.

Successful Proposer. Successful P roposer means a design-build c ontractor awarded a Work Order Package.

Supplier. Any Person, other than employees of Design-Builder, who supplies machinery, equipment, materials or systems to Design-Builder or any Subcontractor in connection with performance of the Work.

Time and Material Change Order (TMCO). A Time and Materials Ch ange Order, unilaterally issued by the City, shall instruct Design-Builder to perform Work, indicating expressly the intention to treat the items as changes in the Work, and setting forth the kind, character and limits of the Work as far as they can be ascertained, the terms under which changes to the Work Order Package Price and Work Order Package Deadline, if any, will be determined and the not to exceed estimated cost of the chang e. Upon final determination of the allowable costs, the Change Order shall be finalized to set forth the final adjustment to the Work Order Package Price.

Turnkey Contract Basis. The Design-Builder agrees to provide a completely finished facility ready for occupancy and use in accordance with the requirements of the applicable Work Order Package and Contract Documents, not to exceed the Work Order Package Price, within the Work Order Package Deadline, and the Design-Builder assumes all risks relating to cost overruns, defects and delays arising from the design an d/or the method of construction.

Warranty Certificate. Means that Warranty Certificate provided by the Design-Builder which warrants the Work and any materials and equipment in accordance with the requirements of Section 3.4 of the General Conditions.

Work. All of the administrative, design, engineering, professional, manufacturing, supply, installation, construction, supervision, management, testing, verification, labor, materials, equipment, maintenance, documentation and other duties and services to be furnished and provided by Design-Builder as r equired by a Work Order Package, including all efforts

necessary and appropriate to achieve Final Completion, except for those efforts which the Contract Documents specify will be performed by City or other Persons.

Work Directive. A written order signed by the City in the event of any dispute regarding the scope of the Work. The Work Directive will describe the Work in question and will state the basis for determining compensation, if any, pending resolution of the dispute.

Work Order Package Deadline. Means the time period by which the Work for a Work Order Package must be completed by the Design-Builder.

Work Order Package Price. Means the price Design-Builder agrees to furnish to City all labor, materials, tools, equipment, services, and incidental and customary work necessary to fully and adequately complete the Work Order Package subject to additions and deductions by Change Order.

1.2 CORRELATION AND INTENT OF CONTRACT DOCUMENTS.

1.2.1 Complimentary Documents. It is the intent of the City and Design-Builder that the Contract Documents include all items necessary for proper execution and completion of the Work. The Contract Documents are complimentary, and what is required by one shall be as binding as if required by all, that is, to the extent there is no conflict in which case the order of precedence set forth Article 1 of the Agreement shall govern.

1.2.2 Severability. In the event any provision of the Contract Documents shall be deemed illegal, invalid, unenforceable and/or void by a court of competent jurisdiction or any other governmental agency of competent ju risdiction, such provision s hall be deemed to be severed and deleted from the Cont ract Documents, and all remain ing provisions hereof shall, in other respects, continue in full force and effect.

1.2.3 Provisions Required by Law Deemed Inserted. Each and every provision and clause required by law to be inserted in the Contract Documents shall be deemed to be inserted herein and the Contract Documents shall be read and enforced as though such provision or clause is included herein.

1.2.4 Explanations, Errors and Omissions. The Design-Builder will not be allowed to take advantage of any error or omission in the Contract Documents. Should it appear that the Work to be done or any matter relative thereto is not sufficiently detailed or explained in the Contract Documents, Design-Build er shall submit a Request for I nformation to the Engineer, in writing, asking for such further written explanati ons as may be necessary.

Design-Builder shall conform to the explanation provided. Design-Builder shall promptly notify the Engineer of all errors , omissions, inconsistencies o r other defects (including inaccuracies and inconsistencies) which it may discover in the Contract Documents, and obtain specific instructions in writing regarding any such error, omission or defect, before proceeding with the Work affected thereby. Omission from the Contract Documents or the misdescription of details of Work which are necessary to carry out the intent of the Contract Documents, or which are custom arily performed, shall not reliev e Design-Builder from performing such omitted Work (no matter how extensive) or misde scribed details of the Work and they shall be performed as if fully and correctly set forth and described in the Contract Documents, without entitlement to a Change Order hereunder.

1.2.5 Interpretation. The Contra ct Documents are intended to b e coordinated so that figures, words or notes exhibited on plans and not mentioned in the Construction Documents (including, the Design Documents), or vice versa, are to be executed to the true intent and meaning thereof, the same as if mentioned in the Con struction Documents (including, the Design Documents). Work shown on plans, the dimensions of which are not given, is to be accurately followed according to the scale to w hich plans are made, but figured dimensions in all cases are to be followed, although they may differ from the scale measurements. The Engineer will interpret the meaning of any p art of the Contract Documents about which any misunderstanding may arise, and his decision shall be final.

In the event of the Design-Builder's failure to give such notic e, the Design-Builder shall make good any damage or defect caused thereby. The execution o f work specially detailed or explained without a previous written claim for an extra charge, shall constitute an acceptance by the Design-Builder of the detailed explanations as being in conformity with Contract Documents.

1.2.6 Meaning of Words. Unless otherwise stated in the Contrac t Documents, words which have well-known, technica l or construction industry meani ngs are used in accordance with such recognized meanings. Whenever in the Cont ract Documents the words “directed,” “required,” “permitted,” “ordered,” “designated,” “prescribed,” or words of like import are used, it shall be understood that the direction , requirement, permission, order, designation, or prescrip tion of the Engineer is intended , and similarly the words “approved,” “acceptable,” “satisfactory,” or words of like impo rt, shall mean approved or acceptable to, or satisfactory to the Engineer unless otherwise expressly stated.

1.3 OWNERSHIP AND USE OF DOCUMENTS.

1.3.1 The Construction Document s and other Project-related documents and electronic data prepared by or on behalf of the Design-Builder for the Project shall be deemed to be "works for hire" and are the property of the City. The Design-Builder hereby assigns to the City, without reservation, all copyrights to all such Construction Documents and Project- related documents, models, comput er drawings and other electron ic expression, photographs, and other expression produced by the Design-Builde r. Among those documents are certain "Instrument s of Service," including the d esign drawings, Construction Documents (including, the Design Documents), and other documents that are required by the Contract Document s. Design-Builder shall obtai n a valid written assignment of copyrights from its consultants in terms identical to those that obligate the Design-Builder to the City as expressed in this subsection, which copyrights the Design- Builder hereby assigns to the City. The City, in turn, hereby grants to the Design-Builder a nonexclusive license to reproduce the documents for purposes re lating directly to the Design-Builder's performance of a Work Order Package project, for the Design-Builder's archival records, and for the Design-Builder's reproduction of drawings and photographs in the Design-Builder's marketing materials provided the contents of those materials, as to the Work Order Package project, are approved by City in writing. N o other Work Order Package project-related documents may be reproduced for any other purpose without the express written permission of the City. No other copyrights ar e included in this grant of nonexclusive license to the Design-Builder. This nonexclusive license shall terminate immediately upon the breach of this Agreement by the Design-Builder.

1.3.2 A copy of every technical memorandum and report prepared by Design-Builder shall be submitted to the City to demonstrate progress toward completion of Work. In the event City rejects or has comments on any such work product, City sha ll identify specific

requirements for satisfactory completion by Design-Builder. Design-Builder shall provide City with Work Order Package proj ect-related documents in repro ducible or electronic format, upon City’s written request. Complete Record Documents shall be turned over to City upon termination of this Agreement or Final Completion, whichever occurs first. If the City subsequently reproduces Work Order Package project-related documents or creates (or causes to create) a derivative work based upon Work Order P ackage project-related documents created by the Design-Builder, the City shall remove or completely obliterate the original professional seals, logos, and other indications on the documents of the identity of the Design-Builder and its consultants. However, where required by law, such identification with appropriate qualifying language or other statutorily prescribed information identifying the original architect or the scopes of the reuse of the docume nts may remain or be applied.

1.3.3 If the Design-Bu ilder believes or is advised by any design professional retained to provide services on the Work Order Package project that implementation of any instructions received from the City would cause a violation of any Applicable Law, the Design-Builder shall notify the City in writing.

2. GENERAL CITY PROVISIONS

2.1 INSPECTION BY CITY

2.1.1 The Work shall be done in strict compliance with the approved Contract Documents to the satisfaction of the Engineer. The Engineer shall decide all questions, which may arise as to the quality or acceptability of the Work performed and as to the manner or performance and rate of progress of the Work, and all questions as to progress payments or compensation.

2.1.2 The Engineer shall, at all times, have the right to inspect the Work and materials in the course of manufacture, assembly or installation and make such tests from time to time as may be deemed advisable. The Design-Builder shall keep the Engineer, or his designated representative, informed as to the progress of the Work, giving ample notice, in advance, of appropriate times for inspection and tests, and sha ll furnish reasonable facilities for such inspection and tests for obtaining such inf ormation as Engineer may require respecting the Work and the character of the materials used.

2.1.3 The Engineer may, in his discretion, inspect upon deliver y all equipment and material purchased for a Work Order Package, and if any equipment or material is found not to comply with the Contract Documents, such equipment or material will be rejected.

2.1.4 The Design-Builder shall make available all facilities pr oviding materials or equipment to a Work Order Package project for inspection during manufacture, and at the Site and shops or yards as desired, and shall not conceal any W ork requiring inspection until the same has been approved b y the Engineer. If such Work should be concealed before inspection, the Design-Builder will be required to remove such portions of the Work already installed as may be necessary to enable such inspection to be made, at Design- Builder's sole cost and expense.

2.1.5 As more particularly de scribed in Article 12 herein, all Work rejected shall be remedied, or removed and replaced by the Design-Builder in a manner acceptable to the Engineer and no compensation therefore will be allowed or paid therefore to the Design-

Builder. Any Work done beyond the lines and grades shown on the Contract Documents or established by the Engineer, or any extra work done without valid written authority, will be considered as unauthorized and will not be paid for. Such unauthorized work done may be ordered removed at the Design-Builder's expense. Upon failure on the part of the Design- Builder to comply promptly with any order of the Engineer made under the provisions of these Contract Documents within five (5) business days prior written notice, the Engineer shall have authority to cause defective work to be remedied or removed and replaced and unauthorized work to be removed at the expense of Design-Builder, and to deduct the cost from any monies due or to become due the Design-Builder under a Work Order Package.

2.1.6 Inspection or approval of the Work shall not relieve the Design-Builder of any obligation to faithfully perform and comply with the Contract Documents, and defective work shall be made good and noncomplying materials rejected and replaced at Design-Builder's expense, notwithstanding that such defective work has been previously overlooked by the Engineer and approved.

2.1.7 The Engineers’ inspections, as provided for in this Section 2.1, shall not be in-lieu of the City building officials’ inspections.

3. DESIGN-BUILDER

3.1 REVIEW OF CONTRACT DOCU MENTS AND FIELD CONDITIONS

3.1.1 By Design-Builder’s subm ission of a Proposal, Design-Builder will be deemed and hereby agrees: (1) that it has visited the Site, familiarized itself with the local and as- built conditions under which the Work is to be performed; (2) that it has familiarized itself with the nature, location and extent of concurrent construction projects in the vicinity of the Work Order Package project; (3) that it has familiarized itself with the nature and extent of the Contract Documents, the Work, all Applicable Laws that may affect costs, progress, performance or furnishing of the W o r k ; ( 4 ) t h a t i t h a s c o r r e l a ted local conditions and requirements with the City's requirements, schedule and budget; (5) that it has advised City of any local conditions or requirements which vary from City's requirements and made recommendations to cure such variances; (6) that it is fully ex perienced, qualified and competent to perform the Services; (7) that it is properly equipped, organized and financed to perform the Work; (8) that it is properly permitted, licensed and registered by the State of California to perform the services of a design-build Design-Bui lder; (9) that it has familiarized itself with all conditions bearing upon transporta tion, disposal, handling and storage of materials; (10) that it has familiarized itself with the availability of labor, water, electric power, and roads; (11) that it has familiarized itself with uncertainties of weather and physical conditions at the Site; (12) that it has familiarized itself with the character of equipment and facilities needed preliminary to and during performance of the Work; and (13) that it has familiarized itse lf with the staging and mater ial storage constraints of the Site and will confine its staging and storage operations to approved areas. In addition, and without limiting the foregoing warranties, Design-Builder represents and warrants to City by Design-Builder’s submission of a Proposal as follows:

Design-Builder has obtained and studied (or assumes responsibility to do so) all such examinations, investigations, explorations, tests, reports and studies which pertain to the physical conditions at or contiguous to th e Site or conditions which otherwise may affect the cost, progress, perfo rmance or furnishing of the Work, as Design-Builder considers necessary f or the

performance of the Work hereinafter defined, within the Work Order Package Deadline and schedule and in accor dance with the other terms an d conditions of the Contract Doc uments and no additional examinat ions, investigations, explorations, tests, reports, studies or similar information or data are or will be required by D esign-Builder for such purposes. Design- Builder may rely upon the accura cy of the technical data contai ned in any such documents provided by the City, but not upon non-technical data, interpretations, opinions or conditional statements contained therein or for the completeness thereof for Design-Builder's purposes.

3.1.3 For purposes of this Section, the term “Hazardous Materials” means any substance, material, or waste which is, or becomes, regulated by any local governmental authority, the State of California, or the Unit ed States Government, including , but not limited to, any material or substance which is (a) defined as a “hazardous waste,” “extremely hazardous waste,” or “restricted hazardous waste” under Section 25115, 25117 or 25122.7, or listed pursuant to Section 25140 of the California Health and Safety Code, Division 20, Chapter

6.5 (Hazardous Waste Control Law), (b) defined as a “hazardous substance” under Section 25316 of the California Health and Safety Code, Division 20, Ch apter 6.8 (Carpenter- Presley-Tanner Hazardous Substance Account Act), (c) defined as a “hazardous material,” “hazardous substance,” or “hazardous waste” under Section 25501 of the California Health and Safety Code, Division 20, Chapt er 6.95 (Hazardous Materials Release Response Plans and Inventory), (d) defined as a “hazardous substance” under Section 25281 of the California Health and Safety Co de, Division 20, Chapter 6.7 (Un derground Storage of Hazardous Substances), (e) petroleum, (f) friable asbestos, (g) polychlorinated byphenyls, (h) methyltertiary butyl ether , (i) listed under Article 9 or d efined as “hazardous” or “extremely hazardous” pursuant to Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20, ( l) designated as “hazardous subs tances” pursuant to Section 311 of the Clean Water Act (33 U.S.C. §1317), (m) defined as a “hazardous waste” pursuant to Section 1004 of the Re source Conservation and Recov ery Act, 42 U.S.C. §6901 et seq.(42 U.S.C. §6903), (n ) defined as “hazardous subst ances” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. §9601 et seq., or (o) defined as a “hazardous substance” under California Health and Safety Code § 33459.

City represents and agrees that (a) to the best of City’s knowledge as of the award date of the applicable Work Order Package, neither City nor any third party has stored or disposed of, or is using, generating, storing or disposing of, any Hazardous Materials on, under, or within the Site which comprises any part of a Work Order Package project, in violation of Applicable Laws; and (ii) City shall not knowingly, and shall not knowingly permit any third party to, use, generate, store or dispose of any Hazardous Material on, under, or within the Sites which comprises any part of this Work Order Package proje ct, in violation of Applicable Laws.

By its award date of any applicable Work Order Package, the City no knowledge of, and makes no representations regarding, the existence of Hazardous Materials in that part of the Work Order Package project which is not on the Sites.

Design-Builder shall comply in all material respects, to the best of Design-Builder’s ability, with the requirements of Applicable Laws and related regulations and with all similar laws and regulations and shall notify City immediately in the event of any discharge or discovery of any Hazardous Materials at, upon, under or within a Work Order Package project during

its performance of the Work. Des ign-Builder shall promptly forward to City copies of all orders, notices, permits, applications or other communications and reports forwarded to or received by Design-Builder in connection with any discharge or the presence of any Hazardous Material or any other matters relating to Applicable Laws or any similar laws or regulations, as they may affect the Work Order Package project, whether or not they occur on land being utilized by the Work Order Package project.

Notwithstanding any indemnificati on provisions elsewhere in thi s Agreement, Design- Builder shall indemnify City against any liability or loss aris ing from the discharge of Hazardous Materials, or violation of Applicable Laws, on the Work Order Package project, but only to the extent such liability or loss arises from the a ffirmative acts, or affirmative failure to act, of Design-Builder, its employees, agents, or su bcontractors, during the performance of a Work Order Package project, which result in violations of Applicable Laws or the discharge of Hazardous Substances. The rights and obligations set forth under this Section shall survive the termination of this Agreement.

3.2 LABOR AND MATERIALS

3.2.1 Labor Code. For every Wor k Order Package, the Design-Builder shall strictly adhere to the provisions of the Labor Code regarding minimum wages, the 8 hour day, the 40-hour week, overtime, Saturday, Sunday and holiday work, apprentice employment and training, workers’ compensation, certification, non-discrimination and prevailing wages, all as more specifically set forth in Article 15 herein.

3.2.2 Preparation for Shipment. For every Work Order Package, t he Design-Builder or Design-Builder's Suppliers shall prepare all articles and materials for shipment in such a manner as to protect them from damage in transit, and shall be responsible for and repair all damaged parts or replace all losses incurred in transit to the designated delivery point.

When necessary, heavy parts shall be mounted on skids or crated , and all articles or materials that might otherwise be lost shall be boxed or wired in bundles. All articles shall be plainly marked for identification and destination. The Desi gn-Builder shall prepare proper commercial bills of lading, three copies of which, together with a complete shipping list, shall be sent to the Engineer.

3.2.3 Identification. All correspondence, drawings, shipping papers, documents and invoices pertaining to equipment described in the Contract Docu ments shall be plainly marked with the number of the purchase order. All bundles, boxes, crates, containers, and pieces of equipment shipped under the Contract Documents shall be plainly labeled with said number.

3.2.4 Delivery. Delivery shal l mean the delivery to the Site of complete equipment or material components required by, and complying with, the Contract Documents.

3.2.4.1 The Design-Builder sha ll place orders for all equipment in time to prevent any delay in the Project Schedule or Substantial Completion. If any materials or equipment are not ordered in time, additional charges made by equipment manufacturers to complete their equipment in time to meet the Pr oject Schedule, together with a ny special handling charges, shall be borne by the Design-Builder.

3.2.4.2 Materials shall be deli vered in sample quantities from time to time as may be

necessary for the uninterrupted progress of the Work. They shall be stored so as to cause the least obstruction to the Site and distributed so as to prevent overloading any portion of the structure. These areas shall be only in approved locations and shall not interfere with the work of any City contractor with the use of property adjacent to the Site.

3.2.4.3 The Design-Builder shall provide facilities and personnel for unloading, receiving, and warehousing all equipment and materials at the Site. It is distinctly understood that the City shall in no event be responsible for, nor does it assume any liability for, the equipment or materials received.

3.2.4.4 All Work, equipment and materials shall be protected at all times. The Design- Builder shall make good all damage caused either directly or indirectly by his employees or Subcontractors. The Design-Builder shall also protect his own Work from damage. The Design-Builder shall close all pipe openings with caps or plugs during installation. The Design-Builder shall protect all of his equipment and materials against dirt, water, chemical and mechanical injury. Upon completion, all Work shall be thor oughly cleaned and delivered in a new condition.

3.2.5 Property Ownership

3.2.5.1 Except as otherwise prov ided for in these General Conditions, title to all material and equipment shall vest in the City upon shipment thereof, but all risk or loss in respect thereto shall remain with the Design-Builder until the City has accepted the material and equipment following Final Completion. This risk of loss includes insuring the shipment and acting as the principal plaintiff in case of damage incurred during shipment or erection of the equipment.

3.2.5.2 Although title to the equipment and material passes to the City upon shipment, as above specified, the Design-Builder shall have the charge and c are thereof until Final Completion. The Design-Builder shall bear the expense of any theft or damage whatever to the equipment and materials during that period except that the City will bear the expense of any such damage that is caused by its gross negligence or willful misconduct.

3.2.5.3 The Design-Builder off ers and agrees to assign to City all rights, title, and interest in and to all causes of action it may have under Secti on 4 of the Clayton Act (15 U.S.C. Sec. 15) or under the Cartwright Act (Chapter 2 (Section 16700, et seq.) of Part 2 of Division 7 of the Business and Prof essions Code), arising from purchases of goods, services, or materials pursuant to a Work Order Package,. This assignment shall be made and become effective at the tim e the City tenders final payment to the Design-Builder, without further acknowledgment by the Parties.

3.3 SUBSTITUTIONS

3.3.1 The burden of proof as to the type, function, and quality of any such substitution product, material or equipment shall be upon the Design-Builder. The final determination of the acceptability of substitute items rests solely in the discretion of the City.

3.3.2 Without any increase in c ost to the City, the Design-Builder shall be responsible for and pay all costs in connection with proposed substitutions and of inspections and testing of equipment or materials submitted for review prior to the Design-Builder's purchase thereof for incorporati on in the Work, whether or not the City accepts the

proposed substitution or proposed equipment or material. The D esign-Builder shall reimburse the City for the charges of the City for evaluating each proposed substitution.

3.4 WARRANTY

3.4.1 Without limiting any other rights of Design-Builder, Design-Builder warrants to City that: all equipment and materials furnished for every Work Order Package, will be of good quality and new; that the Work will be free from defects, including design defects, errors and omissions; the Work Order Package project shall be fit for use for its intended function; and that the Work will conform to the requirements of the Contract Documents.

Work not conforming to these requirements, including substitutions not made in accordance with the Contract Documents, shall be considered defective. If required by the Engineer, the Design-Builder shall furnish satisfactory evidence as to the kind and quality of materials and equipment furnished. Without limiting any other rights or remedies of the City, if any defect in the Work arises within one (1) year after the date of Substantial Completion, the Design-Builder, upon receipt of written notice of such defect, as provided in Article 12 herein, shall promptly repair or replace such defective Work without cost to City.

3.4.2 Design-Builder shall obtain in the name of the City (or such other name as City may designate in writing to Design-Builder) and transfer or assign to City or City's designee at the time of Final Completion of the Work, any and all warran ties or guarantees which Design-Builder is required to obtain pursuant to the Contract D ocuments which Design- Builder obtained from any other person or entity other than Des ign-Builder and further agrees to perform the Work in suc h a manner so as to preserve a ny and all such warranties.

3.4.3 Design-Builder agrees to obtain from Subcontractors, mate rial suppliers and manufacturers, warranties for labor and materials which extend beyond the one (1) year warranty and correction period r equired by a Work Order Package , for the following systems: any warranty upgrades or extensions which are offered by manufacturers of any equipment or system utilized in t he Work Order Package project, a s p a r t o f t h e manufacturer's standard warranties shall be offered to the City by the Design-Builder.

3.4.4 Within ten (10) Days of its receipt of Final Completion, Design-Builder shall provide the City with a Warranty Certificate to guarantee the W ork and materials and equipment for such period and manner as required herein.

3.5 TAXES

3.5.1 Design-Builder shall pay and assumes exclusive liability for, and shall pay before delinquency, all federal, state or local sales, use, excise and other taxes, charges or contributions of any kind now or hereafter imposed on, or with respect to, or measured by, the equipment, materials, supplies or labor furnished hereunder or the wages, salaries, or other remunerations paid to individuals employed in connection with the performance of the Work.

3.6 APPLICABLE LAW

The Design-Builder shall keep fully informed of all Applicable Laws which in any manner affect those engaged or employed in the Work, or the materials used in the Work, or which in any way affect the conduct of the Work, and of all such orders and decrees of bodies or

tribunals having any jurisdiction or authority over the same. If any discrepancy or inconsistency is discovered in t he Contract Documents for the W ork in relation to any Applicable Law, including a change in Applicable Law, the Design-Builder shall forthwith report the same to the Engineer in writing. The Design-Builder shall at all times, observe and comply with and shall cause all of his agents and employees to observe and comply w i t h , a l l A p p l i c a b l e L a w s . I f t h e D e s i g n - B u i l d e r p e r f o r m s t h e Work knowing it to be contrary to Applicable Law, t he Design-Builder shall assume ful l responsibility and bear costs applicable to correction.

3.7 PERMITS, LICENSES AND INSPECTIONS

The Design-Builder will apply for permits, plan checks, inspect ions, licenses, and such other Government Approvals unless the Engineer or the Contract Documents expressly provide otherwise. The Design-Builder shall comply with and give notices required by all Applicable Laws. The Design-Builder shall pay for any permits, plan checks, inspections, licenses, and other Government Approvals.

3.8 SCHEDULE

3.8.1 Design-Builder shall pr epare and submit a Project Schedul e and any amendments thereto for the review and approval of the Engineer. Amendments to the Project Schedule shall be in a detailed precedence-style critical path method (CPM) format satisfactory to the City and the Design-Builder which shall als o: (1) provide a graphic representation of all activities and events that will occur during performance of the Work; (2) identify each phase of construction and occupancy; and (3) set forth dates that are critical in ensuring the timely and orderly completion of the Work in ac cordance with the requirements of the Contract Documents (hereinafter referred to as Milestone Dates).

Upon review by the City of the Project Schedule as a whole and of the Milestone Dates, the Project Schedule shall be deemed part of the Contract Documents.

The Project Schedule shall be promptly revised by the Design-Builder in accordance with the recommendations of the Cit y, if needed, and resubmitted. T he Design-Builder shall monitor the progress of the Work for conformance with the requi rements of the Project Schedule and shall promptly advise the City of any delays or potential delays.

3.8.2 With each Application for Payment submitted by Design-Builder, other than the Final Application for Payment, the Design-Builder shall submit to the City, as directed by the City Project Manager, a current Project Schedule revised to indicate the portion of the Work executed during the time period covered by the Application for Payment, all progress slippages occurring during the previously covered time periods and the corrective actions taken or slippage carry-over into the time period covered by the Application for Payment, all anticipated delays or difficult ies, a Recovery Schedule, as app licable, and all other information required to accurately present the actual status of the progress of the Work as of the date of Application for Pa yment and as may be further re quired by the City or Design-Builder. If the Design- Builder does not submit the curr ently revised Project Schedule with an Application for Payment, the City may withhold payment, in whole or in part, in addition to other causes for such withholding provided for in the Contract
Documents. In the event any amendments to the Project Schedule indicate any delays, the Design-Builder shall propose an a ffirmative plan to correct the delay, including overtime and/or additional labor, if necessary. In no event shall any update constitute an adjustment in the Work Order Package Deadline, any Milestone Date or the Work Order Package Price

unless any such adjustment is agreed to by the City and authorized pursuant to a Change Order.

3.8.3 In the event any update to the Project Schedule shows the Work or any part thereof is lagging the critical path by ten (10) Days or more, Design-Builder shall submit a Recovery Schedule, demonstrating Design-Builder’s proposed plan to regain lost schedule progress and to achieve Substantial Completion of the Work in a ccordance with the requirements of the Contract Documents.

3.9 RECORD DOCUMENTS AND AS-BUILTS

3.9.1 For every Work Order Pa ckage, Design-Builder shall maintain in a safe place at the Site and make available to City for inspection and copying, one record copy of all drawings, specifications, requests for information, written amendments, Change Orders, field orders and work change directives, in good order. In add ition, Design-Builder shall maintain at the Sites, approved shop drawings, product data, sa mples and mock-ups, permits, inspection reports, test results, daily logs, schedules, subcontracts and purchase orders (“Record Documents”). The Record Documents shall be prepared and continuously updated during the prosecution of the Work. As part of Record Documents, Design-Builder shall maintain a set of As-Built Drawings on Sites in good condition and shall use colored pencils to mark up said set with "record information" in a legible manner to show:

A. deviations from the drawi ngs made during construction;

B. details in the Work not previously shown;

C. changes to existing conditions or existing conditions found to differ from those shown on any existing drawings;

D. the actual installed position of equipment, piping, conduits , light switches, electrical fixtures, circuiting, ducts, dampers, access panels, control valves, drains, openings, stub-outs and like items; and

E. such other information as City may reasonably request.

Design-Builder's submittal of evidence of updated Record Documents shall be a condition precedent to City's duty to process payment applications.

3.9.2 Design-Builder, as part of the Work Order Package Price, within thirty (30) Days after Substantial Completion or earlier termination of the Agre ement and as a condition precedent to certifying of the final payment under a Work Order Package,, shall transfer the "As-Built" changes to the Work maintained by Design-Builder from the record drawings kept at the Sites to: (a) three (3) hard copy sets of a true and com plete final set of "As-Built" drawings (24"x36") capable of being reproduced and one copy in the latest version of AUTOCAD format on compact disks or other City-approved technology; (b) final approved shop drawings; and (c) a complete certified "As-Built" survey f or the Site indicating the actual location of the improvements as constructed on the Site. The Design-Builder's duty to provide such As-Built Drawings, Shop Drawings and survey obligation shall survive the completion of the Work or termination of the Agreement.

3.10 INTELLECTUAL PROPER TY AND PATENT RIGHTS

3.10.1 For every Work Order Pa ckage, the Design-Builder shall secure in writing from all patentees, copyright holders, and assignees of all Work Order Package project-related documents, all copyrights, assign ments, and licenses related to such expression (e.g., designs, drawings, Contract Documents, specifications, documents in computer form, etc.) as necessary to allow the City the full, unlimited, and unencumbered use of that expression for the execution, operation, maintenance, modernization or expansion of the Work Order Package project. The Design-Builder shall immediately convey a ll such copyrights, assignments, and licenses to the City without reservation except that which is expressly allowed in this Article. In the case of products, materials, s ystems, etc., protected by patent, the Design-Builder and its consultants shall not specify or cause to be specified any infringing use of a patent.

3.10.2 Should the Desig n-Builder become aware of or receive not ice of potential infringement of any intellectual property right related to the Work Order Package project, regardless of the source of that awareness or notice, the Desig n-Builder shall (a) immediately cease the copying and any other activity which is t he potential source of infringement; and within seven (7) Days (b) investigate the pot ential infringement; (c) submit to the City copies of all documents relating to that awa reness, the notice, or the object thereof; and (d) issue to the City a complete written re sponse and analysis of the potential infringement and the course of action recommended by the Design-Builder. The Design-Builder shall submit to the City a supplement of the initial report within seven (7) Days of the Design-Builder's receipt of, or awareness of, addit ional related information.

Nothing in this Agreement shall be deemed to relieve the Design-Builder of its obligations under this Article, nor shall the City's receipt of the information indicated in this Article give rise to any duty or obligation on the part of City.

3.10.3 For every Work Order Package, the Design-Builder and its Faithful Performance Bond Surety shall indemnify, defend, and hold harmless, the City from all liability, costs, and attorneys' fees incurred which are related to infringement of intellectual property rights, whether or not the infringement is potential, accused, or proven. Should the City become aware of, or receive notice of, potential, accused, or actual i nfringement of intellectual property rights, the City shall, in its sole option, have the right to engage independent legal counsel to advise the City as to the infringement. The costs and fees for such counsel shall be borne by the Design-Builder and shall be immediately recoverable by the City against amounts due or soon to be due to the Design-Builder or amounts already paid to the Design-Builder.

3.11 SUBMITTALS AND SHOP DRAWINGS

3.11.1 Design-Builder will review for compliance with the Contr act Documents, approve and submit to Engineer, Shop Drawings, product data and similar submittals required by the Contract Documents. City will review and approve submittals in accordance with the Contract Documents. City’s revi ew and approval will be only to determine if the items covered by the submittals will, after installation or incorporation in the construction, conform to the information given in the Contract Documents and be compa tible with the design
concept of the completed project as a functioning whole as indi cated by the Contract Documents. City’s review and approval will not extend to means , methods, techniques, sequences or procedures of construction (except where a particu lar means, method, technique, sequence or procedure of construction is specifically and expressly called for by

the Contract Documents) or to safety precautions or programs incident thereto. The review and approval of a separate item, as such, will not indicate app roval of the assembly in which the item functions. Design-Builder shall make corrections required by City, and shall return the required number of co rrected copies of the required submittal for review and approval. Design-Builder shall direct specific attention in writing to revisions other than the corrections called for by City on previous submittals.

City’s review and approval of required submittals shall not rel ieve Design-Builder from responsibility for any variation from the requirements of the C ontract Documents unless Design-Builder has in writing ca lled City’s attention to each s uch variation at the time of submission and City has given written approval of each such variation by specific written notation thereof incorporated in or accompanying the submittal.

3.11.2 Where a submittal is required by the Contract Documents of related construction provided prior to City’s review and approval, Design-Builder shall bear the risk at the sole expense and responsibility of Design-Builder.

3.11.3 The Design-Builder shall prepare Shop Drawings necessary for the Work and shall check the same for accurate measurements taken from the Work, and when assured that such drawings have been proper ly prepared, shall submit sa me to the Engineer for approval.

3.11.4 When Shop Drawings cannot be made from actual dimensions taken from the Work but are prepared from the Preliminary Design Documents, it is distinctly understood that the Design-Builder is responsible for the accuracy of the information on which such drawings are prepared, for the City does not vouch for their ac curacy, but will make available to the Design-Builder information upon which such plans were made.

3.11.5 It is definitely underst ood that the Engineer's approval of the Shop Drawings is for the design only and not for dimensions or structural accuracy, but will make available to Design-Builder information upon which such plans were made.

3.11.6 Any material ordered by the Design-Builder prior to the approval of Shop Drawings, shall be at his own r isk. The Engineer shall have th e right to keep Shop Drawings submitted for approval two (2) weeks before returning to the Design-Builder with corrections or approval, and no claim for delay on this account shall be recognized. Four complete prints of each approv ed drawing prepared by the Design -Builder shall be furnished to the Engineer.

3.12 USE OF SITE AND OTHER AREAS

3.12.1 For every Work Order Pa ckage, Design-Builder shall confi ne construction equipment, the storage of mater ials and equipment and the opera tions of construction workers to those lands and areas allowed by the City and other land and areas allowed by laws and regulations, rights-of-way, permits and easements, and shall not unreasonably encumber the Site with construction equipment or other materials or equipment. Design- Builder shall assume full responsibility for any damage to any such land or area, or to the City or occupant thereof or of any adjacent land or areas, resulting from the performance of the Work. Design-Builder shall, to the fullest extent permitte d by laws and regulations, indemnify and hold harmless City, City’s consultants and anyone directly or indirectly employed by any of them from and against all claims, costs, los ses and damages

(including, but not limited to, fees of engineers, architects, attorneys and other professionals and court and arbitration or other dispute resolution costs) arising out of or resulting from any claim or action, legal or equitable, brought by any such City or occupant against City, or any other party indemnified hereunder to the e xtent caused by or based upon Design-Builder’s performance of the construction.

3.12.2 During the performance of t he construction of any Work Order Package project, Design-Builder shall keep the Site free from accumulations of waste materials, rubbish and other debris resulting from the construction. At the completion of the construction Design- Builder shall remove all waste materials, rubbish and debris from and about the Sites as well as all tools, appliances, construction equipment, temporary construction and machinery and surplus materials. Design-Builder shall leave the Site clean and ready for occupancy by City at Substantial Completion.

3.12.3 Design-Builder shall rest ore to original condition all property not designated for alteration by the Contract Documents by Substantial Completion.

3.12.4 Design-Builder shall not load nor permit any part of any structure to be loaded in any manner that will endanger the structure, nor shall Design-Builder subject any part of the Work or adjacent property to stresses or pressures that will endanger it.

3.13 INDEMNITY

3.13.1 As respects acts, errors or omissions in the performance of professional services, Design-Builder agrees to indemnify and hold harmless City, its officials, agents, employees, representatives. and City-designa ted volunteers from and agains t any and all claims, demands, defense costs, liability or consequential damages of any kind or nature arising directly out of Design-Builder 's (or Subcontractors, if any) ne gligent acts, errors or omissions in the performance of Design-Builder's professional services under the terms of this Agreement.

3.13.2 As respects all acts or omissions which do not arise directly out of the performance of professional services, including but not limited to those ac ts or omissions normally covered by general and automobile liability insurance, Design-Builder agrees to indemnify, defend (at City's option), and hold harmless City, its official s, agents, employees, representatives, and City-designa ted volunteers from and agains t any and all claims, demands, defense costs, liability, or consequential damages of any kind or nature arising out of or in connection with Desi gn-Builder’s (or Subcontractors, if any) performance or failure to perform, under the terms of this Agreement; excepting those which arise out of the sole negligence of City.

3.13.3 The obligations set forth in this indemnification provision (i) shall be in effect without regard to whether or not City, Design-Builder, or any other person maintains or fails to maintain insurance coverage for any such loss, costs, claims, damages or expenses; and (ii) shall survive the termination of this Agreement.

3.14 MATERIAL SAMPLES

3.14.1 The Design-Builder shall furnish for the written approva l of the Engineer any samples required by the Contract Documents or that may be requested by the Engineer of any and all materials or equipment Design-Builder proposes to u se to complete the Work.

The Design-Builder shall not use any materials or equipment of which samples are required to be submitted until written approval has been given by the Engineer.

3.14.2 A letter in duplicate by the Design-Builder shall accomp any each shipment of samples submitted and shall contain a list of the samples, the name of the building or work for which the materials or equi pment are intended and the brand s of the materials or equipment and names of the manufacturers. Samples of finished m aterials shall be so marked as to indicate where the materials are required by the Contract Documents.

3.14.3 The approval of any sample shall be only for the charact eristics or for the uses named in such approval and for no other purpose. Approval of a sample shall not be construed as to change or modify any Contract Document requirement.

3.14.4 All samples will be provided by the Design-Builder at no extra cost to the City.

3.14.5 All materials and equipment approved by Design-Builder must be submitted to the City for record and final conformance review upon approval. Pr ovide three (3) copies of each submittal with indications of approval by the Design-Builder’s architect of record and the Design-Builder.

3.14.6 It is understood that the Cit y reserves the right to retest all material or equipment which have been tested and accepted at the source of supply aft er the same has been delivered to the Site and to reject all materials or equipment which, when retested, do not meet the requirements of the Contract Documents.

3.15 NONCONFORMING MAT ERIALS OR EQUIPMENT

All materials or equipment not conforming to the requirements of the Contract Documents and any subsequently approved design or construction documents submittal, whether in place or not, shall be rejected and removed immediately from a Site unless otherwise permitted by the Engineer in writing. No rejected material whic h has subsequently been made to conform shall be used unless and until written approval has been given by the Engineer. Upon failure on the part of the Design-Builder to comply with this Section, the Engineer shall have the authority to remove and replace non-conforming materials and to deduct the cost of removal and replacement from any money due or about to become due the Design-Builder.

4. ADMINISTRATION OF THE CONTRACT

4.1 ROLE OF THE ENGINEER

The Engineer or his designee(s) shall be responsible for oversight of the design, permitting and construction on City’s behalf. Design-Builder shall deliver all Design Documents and Construction Documents and other submittals to the Engineer. A ll meetings regarding design and construction shall be coordinated through the Engineer. Design-Builder shall not be relieved of its obligations under the Contract Documents by City approvals.

4.2 CLAIMS AND DISPUTE RESOLUTION

4.2.1 Continuing the Work. Des ign-Builder shall carry on the W ork and adhere to the Project Schedule during all disputes or disagreements with City. No Work shall be delayed or postponed pending resolution of any disputes or disagreements or pending change order requests.

4.2.2 Dispute Resolution. If a di spute arises out of or relate s to this Contract, or the breach thereof, the Parties agree that the negotiation and mediation process prescribed in Assembly Bill No. 626 Section 1 and Public Contract Code Sectio n 9204 shall be used before the filing of a legal action.

4.2.3 If Design-Builder has a "cl aim" as defined in Public Cont ract Code section 9204, Design-Builder and City shall ab ide by the procedures set forth in that section, as summarized in Attachment 1. Any submission of a section 9204 claim by Design-Builder does not constitute a submission of a claim under the Government Tort Claims Act or any other law and as such Design-Buil der will be required to comply with those statutes as applicable.

5. SUBCONTRACTORS, SU PPLIERS AND CONSULTANTS

5.1 SUBCONTRACTING ACT

5.1.1 The Subletting and Subcontracting Fair Practices Act, Sec tions 4100 et seq. of the California Public Contract Code (“Subcontracting Act”) requires Persons bidding on public works contracts to identify cert ain major Subcontractors as par t of their bids. The City recognizes that because a design-build contract may be awarded prior to the completion of the design, it is often impracti cable for the design-build enti ty to list all Subcontractors during the design and procurement phase of the Work. As a resu lt, the Subcontractor listing requirements contained in the Subcontracting Act can cr eate a conflict with the implementation of the design-build process by requiring all Subcontractors to be listed at a time when a sufficient set of plans may not be available. The City recognizes that certain Subcontractors can only be selected by the Design-Builder after a certain amount of design work is completed. Therefore, the City has postponed Design-Bu ilder’s obligation to identify certain Subcontractors, subject to Design-Builder’s co mpliance with the Subcontractor selection policy set forth in this Article 5. Al l Subcontractors shall be afforded the protections contained in the Subcontracting Act.

5.1.2 Design-Builder shall comply with the Subcontracting Act and Chapter 10.06 of the Anaheim Municipal Code when Design-Builder selects a Subcontractor for a Work Order Package. Design-Builder agrees that any Subcontractor not identified within the Proposal who will perform Work or labor o r render Service in the perform ance of a Work Order Package in the amount exceeding ½ of 1% of the difference between the Total of the Work Order Package Price and the amount allocated to Design Services, shall be submitted to the City for approval prior to the execution of any subcontract. Unless waived in writing by the City, Design-Builder shall submit to the City for approval its final list of Subcontractors no later than Design Documents being 50% complete. Once a Subcontractor approved by the City has been selected for any such Work, Design-Builder shall not have the right to make any substitution of such Subcontractor except in accordance with the provisions of the Subcontracting Fair Practices Act, Public Contract Code §§ 4100, et seq. The Engineer shall serve as the hearing officer for the purposes of any hear ing dealing with the substitution of a subcontractor.

5.2 OBJECTION

Design-Builder shall not employ any subcontractor, engineer, supplier or other individual or entity against whom City may hav e reasonable objection. Design -Builder shall not be required to employ any subcont ractor, engineer, supplier or oth er individual or entity to furnish or perform any of the Work against whom Design-Builder has reasonable objection.

5.3 RESPONSIBILITY

Design-Builder shall be fully responsible to City for all acts and omissions of the subcontractors, engineers, supp liers and other individuals or e ntities performing or furnishing any of the Work under a direct or indirect contract with Design-Builder. Nothing in the Contract Documents shall create for the benefit of any such subcontractor, engineer, supplier or other individual or entity any contractual relationship between City and any such subcontractor, engineer, supplier or other individual or entity , nor shall it create any obligation on the part of City to pay or to see to subcontractor, engineer, supplier or other individual or entity except as may otherwise be required by laws and regulations.

5.4 COORDINATION

Design-Builder shall be solely responsible for scheduling and coordinating subcontractors, engineers, suppliers and other individuals and entities performing or furnishing any of the Work under direct or indirect contract with Design-Builder. Design-Builder shall require all subcontractors, engineers, suppliers and such other individuals and entities performing or furnishing any of the Work to communicate with the City through Design-Builder.

5.5 SUBCONTRAC T AGREEMENTS

All Services performed or provi ded to and material and equipmen t supplied to Design- Builder by a Subcontractor or Supplier will be pursuant to an a ppropriate design sub- agreement or construction sub-agreement between Design-Builder and the Subcontractor, engineer or supplier which specifically binds the Subcontractor, engineer or supplier to the terms and conditions of the Contract Documents for the benefit of City. City shall have the right but not the obligation to review and accept the form and substance of Design-Builder’s agreements with Subcontractors. Whenever any such agreement is with a Subcontractor, engineer or supplier who is listed as an additional insured on the property insurance provided for herein, the agreem ent between the Design-Builder a nd the Subcontractor, engineer or supplier will contain provisions whereby the Subcontractor, engineer or supplier waives all rights against City, D esign-Builder, City’s consultants and all other additional insureds for all losses and damages caused by any of the perils or causes of loss covered by such policies and any other property insurance applicable to the Work. If the insurers on any such policies require separate waiver forms to be signed by any subcontractor, engineer or supplier, Design-Builder shall obtain the same.

5.6 ASSIGNMENT

Each subcontract agreement for a portion of the Work is assigned by the Design-Builder to the City provided that assignment is effective only after termi nation of the Work Order Package or Contract by the City and only for those subcontract agreements which the City accepts by notifying the Subcontractor in writing. Said assignments are subject to the prior

rights of the sureties obligated on the bonds relating to this Agreement. Each subcontract shall specifically provide that the City shall only be responsi ble to the Subcontractor for those obligations of the Design-Builder that accrue subsequent to the City's exercise of any rights under this contingent assignment.

6. PAYMENTS TO SUBCONTRACTOR S AND STOP NOTICE CLAIMS

6.1 PROMPT PAYMENT

Design-Builder shall make prompt payment to its Subcontractors and Suppliers within ten (10) Days after receipt of payment from City.

6.2 STOP NOTICE CLAIMS

If at any time there shall be evidence of the existence, whethe r or not same has been asserted, of any stop notice or claim arising out of or in connection with the performance or default in performance of a Wor k Order Package or any subcontra ct or supply contract entered into by Design-Builder to perform this Work Order Package, and if the City might become liable for the discharge or satisfaction of such stop notice or claim, then City shall have the right to retain out o f any payment then due or thereaf ter to become due, in addition to amounts for retainage and as otherwise set forth in Article 9 herein, an amount of one hundred and twenty-five percent (125%) to discharge such stop notice or satisfy such claim and to reimburse the City and the representatives of City for all costs and expenses in connection therewith, including attorneys fees. Further, the City, in its sole discretion, shall have the right to discharge or satisfy such stop notice or claim and pay all costs and expenses in connection therewith if the Design-Builder does not have such stop notice or claim discharged, bonded, or satisfied within ten (10) Days after receiving notice thereof from City, or unless some other procedure for discharge or satisfaction of such stop notice or claim is agreed upon between City and Design-Builder. If the amounts retained by City are insufficient for the aforesaid purposes, or if such stop notice or claim remains undischarged or unsatisfied after all payments have been made to Design-Builder, then the Design-Builder shall refund to the City all monies that may hav e been paid to discharge such lien or satisfy such claims, including costs, expenses and attorneys fees in connection therewith.

7. CHANGES IN THE WORK

7.1 CHANGES

The City may order extra work or make changes by altering, adding to, or deducting from Work, the Work Order Package Price being adjusted accordingly. All changes in the Work shall be performed under applicable provisions of the Contract Documents. Design-Builder shall proceed promptly to perform the change unless otherwise directed in writing by the City. In giving instructions, t he Engineer shall have authority to make minor Changes in Work not involving change in cost or time and not inconsistent with the intent of the Contract Documents. Otherwise, except in an emergency endangering life or property, no extra work or change shall be made except in pursuance of a wri tten Change Notice, Change Order or Time and Material Change Order issued by the Ci ty, and no claim for addition to contract sum shall be valid unless so ordered.

7.2 AUTHORITY TO ORDER CHANGES

7.2.1 No change sha ll be made nor extra work done except with the prior approval thereof by the Engineer and in a conformity with the provisions of this Article. Minor changes in the Work that involve no extra cost, may be approved, authorized and ordered by the Engineer. Except as required by applicable City law, th e City's Public Works Director may execute any order for changes and/or extra work for a Work Order Package provided the accumulated sum of this and all previous Change Orders do not exceed ten percent (10%) of the Work Order Package Price. Any amounts abov e the foregoing will follow the approval process set forth in City law.

7.2.2 Design-Builder shall undertake, at its risk work included in any oral request, order, Change Notice, Change Order or Time and Material Change Order issued by a Person in excess of that Person’s authority as provided herein. Any work performed by the Design- Builder beyond the lines and grades shown on the Contract Documents or any extra work performed or provided by the Des ign-Builder wit hout notice to t he Engineer shall be considered unauthorized and at the sole expense of the Design-Builder. Work so done will not be measured or paid for and no extension of Work Order Pack age Deadline will be granted on account thereof. Any such work may be ordered remov ed at the Design- Builder’s sole cost and expense. The failure of the City to direct or order removal of such Work shall not constitute acceptance or approval of the work nor relieve the Design-Builder from any liability on account thereof.

7.3 CITY INITIATE D CHANGE NOTICE

7.3.1 City may issue a Change Notice, in writing, to the Design-Builder, describing a proposed Change to the Work and requesting the Design-Builder t o submit a Change Proposal, in a format acceptable to City, within fifteen (15) Days after City’s issuance of the Change Notice. The Change Propos al shall include an analysis o f impacts to cost and time, if any, to perform the extra work, or delete Work, as applicable, including the effects and impacts, if any, on unchanged Work, estimates of costs (bro ken down by the categories listed in Section 7.5 herein relating to change of the Work Order Package Price) and Design-Builder’s proposed methods to minimize costs, delay and disruption to the performance of the Work. If Design-Builder fails to submit a Change Proposal within such period of time, it shall be presumed that the Change described in the Change Notice will not result in an increase to the Work Order Package Price or Wo rk Order Package Deadline and the Change shall performed by D esign-Builder without such increases. A Change Notice does not authorize the Design-Builder to commence performance of the changed work, unless otherwise specified in the Change Notice.

7.3.2 If the Parties reach agreem ent on the cost of pricing such change, a Change Order will be issued. If the Parties do not agree on all terms for performance or compensation of the change, City will issue a unilateral Time and Material Change Order.

7.4 DESIGN-BUILDER INITIA TED CHANGE ORDER REQUEST

If the Design-Builder believes that written instructions or directions issued after the award of a Work Order Package will increase Work Order Package project c osts or delivery and
Design-Builder desires to adjust the Work Order Package Price o r Work Order Package Deadline for such an alleged event, the Design-Builder must sub mit a Change Order Request (“COR”) to the Engineer in writing, in a format acceptable to City, and must specify

the reasons for such change, inclu ding relevant circumstances a nd impacts on the schedule. Design-Builder shall submit a Change Proposal concurrently with the COR. The Design-Builder may request additional compensation and/or time through a COR; provided that Design-Builder shall submit such request or COR to the Engineer no later than ten (10) business days from the issuance or occurrence of the City’s written instruction or direction.

No action or inaction of the Cit y shall waive the foregoing Des ign-Builder notification requirements. Design-Builder’s failure to initiate a COR within such period shall be deemed a waiver of the right to adjustment of the Work Order Package P rice or the Work Order Package Deadline for the allege d Change. Any COR that is appro ved by City will be incorporated by a Change Notice, Change Order, or Time and Material Change Order. If the Engineer determines that the Work in question is not a Change, the Engineer will issue a Work Directive, ordering the Design-Builder to proceed with the Work without delay. If the COR is denied but the Design-Builder believes that it does have merit, the Design- Builder may submit a Claim in accordance with the procedures set forth herein.

7.5 CHANGE ORDER

Definition. A Change Order is a written order implementing Changes in the Work for which adjustments to the Work Order Package Price and Work Order Package Deadline, if any, have been agreed upon by the parties, prior to the issuance of the Change Order either in the context of a City-initiated Change Notice or a Design-Builder-initiated COR. A Change Order shall be issued by the Engineer and expressly indicates t he intention to treat the items described therein as c hanges in the Work. A Change Order must be issued and signed by the Engineer before any work is started on the items covered by the order.

7.5.1 Determination of Costs. The Work Order Package Price may only be changed by a Change Order or a Time and Material Change Order. The value of any Work covered by a Change Order or of any claim for an increase or decrease in the Work Order Package Price shall be determined in one of the following ways:

a. Lump Sum Method. Acceptable lu mp sum proposal from Design-Bu ilder properly itemized and supported by sufficient substantiating da ta to permit evaluation.

Estimates for lump sum proposals shall be limited to direct exp enditures necessitated specifically by the subject extra work. In addition, the Design-Builder and Subcontractor will be paid a lump sum for overhead, profit, and bond. Supervision of the extra work shall be included in the lump sum per centage for overhead. For added or omitted work by Subcontractors, the Design-Builder shall furnish to the City th e Subcontractor's detailed estimate of the cost for labor, material, and equipment, includ ing the markup by the Subcontractor for overhead and profit. Such estimate of cost s hall be signed by the Subcontractor. The same require ment shall apply to any Sub-sub contractor or material supplier.

b. Time and Material Method. Direct cost of the Work for labor , material, and equipment rental plus markups for overhead and profit for Gener al Design-Builder, Subcontractor, and Sub-subcontractors as applicable. (Supervis ion is to be included in markup unless specifically agreed to in advance that special supervision is required.)

7.5.2 Documentation.

For either method used, the Design-Builder shall submit the following information as required by the Engineer:

a. LABOR: Attach itemized direct hourly rates in
accordance with certified payroll records times
total hours expended. Separately show dollar
amount for employer-paid payroll
taxes/insurance benefits.

Enter total as direct labor item. ____________

b. MATERIAL: Attach receipts, invoices or itemized
quantity and unit costs plus tax and delivery.

Enter total as material item. ____________

c. EQUIPMENT: Attach receipts, invoices or tear
tickets indicating unit costs and total hours or
loads charged. (Small tools with a value of less
than $500.00 are to be included in markup.)
Enter total as equipment rental item. ____________

d. SUBTOTAL (Lines a + b + c) ____________

e. COMBINED MARKUP FOR ALL OVERHEAD

AND PROFIT SHALL BE BASED ON THE
FOLLOWING:

(1) For the General Design-Builder, for
Work performed by his forces,
fifteen percent (15%)
of his direct subtotal cost. ____________

(2) For the General Design-Builder, for
Work performed by a Subcontractor's
forces, five percent (5%) of the
direct subtotal cost due the Design-Builder. ___________

(3) For a Subcontractor or S ub-subcontractor, for Work performed by their own forces, fifteen percent (15%)
of their own direct subtotal costs. ____________

(4) For a Subcontractor, for Work performed by a
Subcontractor, five percent (5%) of the direct
subtotal cost due the Sub-subcontractor. ____________

f. SUBTOTAL (Lines d + e) ____________

g. GENERAL DESIGN-BUILDER'S BOND
(NTE 1% Line f) ____________

h. TOTAL CHANGE ORDER REQUEST
(Lines f + g) ____________

7.5.3 Final Agreement. Agreem ent on any Change Order shall constitute a final

settlement of all matters relating to the direct and indirect cost and time of performance of Change in the Work which is the subject of the Change Order including, but not limited to, all direct and indirect costs associated with such Change and any and all adjustments to the Work Order Package Price and Work Order Package Deadline. The execution of a Change Order constitutes a mutual accord and satisfaction of th e compensation for the Change and Design-Builder specifically waives and release any a nd all claims, rights or interest, including but not limited to those for delay, impact, disruption, acceleration, loss of efficiency or other extraordinary or consequential costs arising directly or indirectly out of the Work described in the Change Order. There shall be no reservation of rights by either party on a Change Order.

7.5.4 Design-Builder’s Overhead Profit. Extra work ordered on the basis of time and materials will be paid for at the actual necessary cost as determined by the Engineer, plus allowances for overhead and profit. The allowance for overhead and profit will include full compensation for superintendence, taxes, field office expense, extended overhead, home office overhead, and all other items of expense or cost not inc luded in the cost of labor, materials, or equipment provided for under Section 7.5. The allowance for overhead and profit will be made in accordance with the provisions of Section 7.5.

7.5.5 It is understood that labor, materials, and equipment for extra work may be furnished by the Design-Builder or by the Subcontractor of the Design-Builder. When all or any part of the extra work is performed by a Subcontractor, the allowance specified herein will be applied to the labor, materials, and equipment costs of the Sub contractor, to which the Design-Builder may add five per cent (5%) of the Subcontractor's total cost for the extra work. Regardless of the number of hierarchical tiers of Subcon tractors, the five percent (5%) increase above the Subcontractor's total cost which includ es the allowances for overhead and profit specified herein may be applied one time only.

7.6 EXCLUDED COSTS

7.6.1 The term "cost of the Wor k" shall not include any of the following:

7.6.1.1 Payroll costs and other c ompensation of Design-Builder's officers, executives, proprietors, partners, princip als, general managers, engineers, contractors, estimators, attorneys, auditors, accountants, purchasing and contracting ag ents, expediters, timekeepers, clerks, and other personnel employed by the Design-Builder whether at a Site or in the Design-Builder's principal or a branch office for general administration of the Work all of which are to be consider ed administrative costs covered by the Design-Builder's allowance for overhead and profit;

a. Expenses of the Design-Builder 's principal and branch offices including the Design-Builder's office at a Site;

b. Any part of Design-Builder's capital expenses, including int erest on the Design-Builder's capital employed for the Work and charges agai nst the Design-Builder for delinquent payments;

c. Cost of premiums for all Bonds and for all Insurance whether or not the Design-Builder is required by t he Contract Documents to purchas e and maintain the same (except as provided by Section 7.5).

d. Costs due to the negligence or mistake of the Design-Builder , any Subcontractor, or anyone directly or indirectly employed by any of them or for whose acts any of them may be liable, including but not limited t o , t h e correction of Defective Work, disposal of materials or equipmen t wrongly supplied, and making good any damage to property; and

e. Other overhead or general expense costs of any kind and the cost of any item not specifically and expressly included in Section 7.5.

7.7 ALLOWABLE COST BASIS

7.7.1 For the purpose of evaluating and approving proposed Change Order costs, the City will use as its basis the latest edition of the Means Building Construction Cost Data Book Western Edition. No other cost data books or manuals will be considered. The maximum allowable cost for Change Orders resulting in additions to the Work Order Package Price shall not exceed the cost of the Work identified in the Means Cost Data Book, not including Design-Builder's overhead and profit, and bond as set forth els ewhere within this Agreement or a Work Order Package.

7.8 AUDIT RIGHTS

7.8.1 Design-Builder shall keep a correct and current accounting of payroll costs, travel, subsistence, field and incidental expenses.

7.8.2 Design-Builder shall use recognized accounting methods in preparing such invoices and reports. City reserves the right to designate its own employee representative(s) or its contracted representative(s) with a certified public accounting firm who shall have the right to audit Design-Builder's accounting procedures and internal controls of Design-Builder's financial systems and to examine any cost, revenue, payment, claim, other records or supporting documentation resulting from any items set forth in a Work Order Package. If Design-Builder fails to provide supporting documentation satisfactory to City for any costs charged City, then Design-Builder agrees that City may delete such items from the invoice or Design-Builder shall reimburse City for those costs. Any such audit(s) shall be undertaken by City or its representative(s) at reasonable times and in conformance with generally accepted auditing standards. Design-Builder agrees to fully cooperate with any such audit(s).

7.8.3 This right to audit shall extend during the length of this Agreement and for a period of three (3) years, or longer if required by law, following the date of final payment under this Agreement. Design-Builder agrees to retain all necessary records/documentation for the entire length of this audit period.

7.8.4 Design-Builder will be notified in writing of any exception taken as a result of an audit or pre-payment review of an in voice. Any adjustments and/or pa yments which must be made as a result of any such audit or inspection of Design-Builder's invoices and/or records shall be made within thirty (30) Days from presentation of City's findings to Design-Builder.

If Design-Builder fails to make such payment, Design-Builder ag rees to pay interest, accruing monthly, at a rate of ten percent (10%) per annum unless another section of this Agreement specifies a higher rate of interest, then the higher rate will prevail. Interest will be computed from the date of written notification of exception( s) to the date Design-Builder
reimburses City for any exception(s). If an audit inspection or examination in accordance

with this article discloses overcharges (of any nature) by Design-Builder to City in excess of one percent (1%) of the value of that portion of the contract t hat was audited, the actual cost of City's audit shall be reimbursed to City by Design-Builder. Design-Builder reserves the right to contest any exception.

7.8.5 Design-Builder shall include a similar clause in its agreements with Subcontractors reserving the right to designate its own employee representativ es from a certified public accounting firm, and/or representative(s) from City, who shall have the right to audit and to examine any cost, payment, settlement or other supporting documentation resulting from any item set forth in its agreements.

7.9 DEDUCTION FROM WORK

The amount of credit to be allow ed by the Design-Builder to the City for a deletion or change that results in a net decrease in the contract sum shall be actual net cost. When both additions and credits covering related Work or substitutions are involved in a change, the allowance for overhead and profit shall be figured on the basis of net increase, if any, with respect to that change.

7.10 DESIGN-BUILDER AND SURETIES BOUND

Any changes or extra work hereunder shall be a part of and subject to all the provisions of the Contract Documents and the Design-Builder, and his Sureties shall be bound thereby and to the same extent as under the original Contract Documents.

7.11 TIME AND MATERIAL CHANGE ORDER (TMCO)

7.11.1 If it be impossible or impracticable to ascertain the total cost of changes in the Work to be done before such work is begun, or if no agreement can be reached on changes in the Work and additions to the Work Order Package Price, then a TMCO shall be issued unilaterally by the Engineer instructing the Design-Builder to do the Work, indicating expressly and unmistakably the intention to treat the items as changes in the Work, setting forth the kind, character and limits of the Work as far as can be ascertained, the terms under which changes to the Work Order Package Price will be det ermined and the estimated total change in Work Order Package Price anticipated thereunder. The TMCO shall be fully executed by City. Such TMCO will become the basis for the Change Order when the amounts of adjustment to the Work Order Package Price can be determined and the prior approval of the TMCO will be considered necessary authority within the limits of the estimated change in Work Order Package Price. Without additional authority, no costs exceeding the estimated amount will be paid.

7.11.2 The Design-Builder shall maintain records sufficient to distinguish the direct cost of TMCO Work from the cost of other operations. The Design-Builder shall furnish daily, on forms approved by City, reports o f TMCO Work. The reports shal l itemize all costs for labor, materials, and equipment r ental and give a total of cost s to date for the Time & Material Work. The reports shall include hours worked, rates o f pay, names and classifications. The reports shall include equipment size, type, identification number, rental rate, and hours of operation. All records and reports shall be made immediately available to the Engineer upon request. The cost of furnishing such repo rts shall be included in Design-Builder's overhead and fee percentages.

7.11.3 All time and material reports shall be signed by the Des ign-Builder or authorized representative, and witnessed by City’s inspector each and every Work day. The Engineer will compare the Engineer's records with the Design-Builder's reports, make the necessary adjustments and compile the costs of time and material Work. W hen such reports are agreed upon and signed by both parties, they will become the basis of payment.

7.11.4 Construction Equipment compensation shall not be allowed while it is inoperative due to breakdown. Except as other wise specified in this Sectio n 7.11.4, time will be computed in half and full hours. In computing the time for use of Construction equipment, less than thirty-one (31) minutes shall be considered one-half hour. Costs for Construction equipment on standby shall be limited to the sum of the hourly overhead and depreciation rates for eight (8) hours per tw enty-four (24) hour period, acc rued after the construction equipment is idle for sixteen (16) hours in a twenty-four (24) hour period.

7.11.5 City may authorize and approve payment for necessary services and expenditures other than labor, materials, and equipment rentals.

7.11.6 Materials, equipment rent al and other costs shall be sub stantiated by vendors' invoices submitted with the current reports; or, if not then available, shall be submitted with subsequent reports. If vendors' invoices are not submitted within 30 Days after completion of the Time & Material Work or if in the opinion of the Enginee r the cost of materials is excessive, then the cost of such items shall be deemed to be the lowest current wholesale prices at which the items are available in the quantities required, delivered to the Site, less cash or trade discounts.

7.11.7 Labor costs, overhead and profit and Design-Builder's fee percentages shall conform to that specified in the Section entitled Change Orders herein.

7.12 FORCE ACCOUNT WORK

If no agreement can be reached on Changes in the Work and adjus tment of the Work Order Package Price or Work Order Package Deadline, or the Design-Builder refuses to accept a Change Notice, Change Order, or Time and Material Change Order, the City shall have the right to have the Work in question done by Persons other than the Design-Builder.

8. TIME

8.1 EXTRAORDINA RY MEASURES

8.1.1 In the event the City dete rmines that the performance of the Work, as of a Milestone Date, has not progressed or reac hed the level of completion req uired by the Contract Documents, the City shall have t he right to order the Design-Bu ilder to take corrective measures necessary to expedite the progress of construction, including, without limitation, (1) working additional shifts or overtime, (2) supplying additional manpower, equipment, and facilities and (3) submitting a Recovery Schedule for re-sequencing performance of the Work or other similar measures (hereinafter referred to collect ively as Extraordinary Measures). Such Extraordinary M easures shall continue until th e progress of the Work complies with the stage of completion required by the Contract Documents. The City's right to require Extraordinary Measures is solely for the purpose of ensuring the Design-Builder's compliance with the Project Schedule.

1) The Design-Builder shall not be entitled to an adjustment in a Work Order Package Price in connection with the Extraordinary Measures required by the City under or pursuant to this Article 8.

2) The City may exercise the ri ghts furnished the City under or pursuant to this Article 8 as frequently as the City deems necessary to ensure t hat the Design-Builder's performance of the Work will comply with the Work Order Package Deadline, any Milestone Date or completion date set for th in the Contract Documents.

8.1.2 If the Design-Builder's P roject Schedule shows completion of the Work in advance of the Work Order Package Deadli ne, the Design-Builder agrees that in the event actual completion occurs, for any reason, after the completion date sp ecified in the Design- Builder's Project Schedule but within the Work Order Package Deadline, the Design-Builder shall not be entitled to and waives any claim against the City for delay, disruption or impact costs or damages including, without limitation claims for exten ded general conditions, home-office overhead, job-site overhead and management or administrative costs.

8.2 TIME EXTENSIONS

8.2.1If the critical path of the Work is delayed at any time in the progress of the Work by the Non-Compensable Delays defined in the Agreement, and did not result from the acts of the Design-Builder, and provided furt her that the Design-Builder ha s taken reasonable precautions to prevent further delays owing to such causes, then the Work Order Package Deadline shall be extended by Change Order. The Design-Builder agrees that the extension of time granted under this Article 8 shall be its sole and exclusive remedy for the consequences of any delay described above.

8.2.2 Any claim for extension of time shall be made in writing to the City not more than ten (10) Days after the commencement of the delay. Within thirty (30) Days after such delay the Design-Builder shall furnish the City with detailed informa tion concerning the circumstances of the delay, the number of Days actually delayed, the appropriate Contract Document references, and the meas ures taken to prevent or minim ize the delay. The Design-Builder acknowledges the extreme importance of promptly notifying and thoroughly documenting any request for time extension and further specifically acknowledges that the City will suffer extreme prejudice should Design-Builder fail in any way to comply with this requirement. Failure to comply with the procedures contained within this Article 8 including the time limits established in this Section 8.2.2 shall constitute a waiver of such request.

Evidence presented by the Desi gn-Builder that the City had actu al notice of the time extension request, that the City was not prejudiced by Design-Builder's failure to comply with this requirement, and/or that the City considered Design-B uilder's request despite Design-Builder's failure to strictly comply with this provision shall not render this requirement unenforceable.

8.2.3 An extension of time will not be granted for a delay caus ed by a shortage of materials or equipment, except t he City furnished materials or equipment, unless the Design-Builder furnishes to the City documented proof that the Design-Builder has made every effort to obtain such mat erials or equipment from every k nown source within
reasonable reach of the Work. The Design-Builder shall also submit proof, in the form of network analysis data that the inability to obtain such materials when originally planned did,

in fact, cause a delay in Final Completion of the Work which could not be compensated for by revising the sequence of oper ations. Only the physical shor tage of material or equipment will be considered under these provisions as a cause for extension of time. No consideration will be given to any claim that material or equipment could not be obtained at a reasonable, practical, or economical cost, unless it is shown to the satisfaction of the Design-Builder that such material or equipment could have been obtained only at exorbitant prices, entirely inconsistent with current rates taking into account the quantities involved and the usual practices in obtaining such quantities and that such fact could not have been known or anticipated at the Work Order Package award date.

8.2.4 No extension of time wil l be granted under this Article 8 for any delay to the extent (1) that performance would have been so delayed by any Design-Builder induced causes, including, but not limited to, the fault or negligence of the D esign-Builder or its Subcontractors; or (2) for which any remedies are provided for or excluded by any other provision of the Contract Documents.

8.2.5 A Change Order will be issued to the Design-Builder withi n a reasonable period of time after approval of a request for extension of the Work Orde r Package Deadline, specifying the number of Days allowed, if any, and the new date or number of Days after the date of commencement for completion of the Work or specified portions of the Work.

8.2.6 An extension of time grant ed shall not release the Design-Builder's Surety from its obligations. Work shall continue and be carried on in accordance with all the provisions of the Contract Documents and the Agreement shall be and shall rem ain in full force and effect during the continuance and until Final Completion and Final Acceptance of the Work unless formally suspended or annulled in accordance with the terms of this Agreement.

8.2.7 Neither the grant of an ext ension of time beyond the date fi x e d fo r S u b s ta n ti al Completion of the Work, nor the performance and acceptance of any part of the Work or materials specified by the Work Order Package after the time sp ecified for Substantial Completion of the Work, shall be deemed to be a waiver by the C ity of the City's right to abrogate a Work Order Package for abandonment or failure to com plete within the time specified or to impose and deduct damages as may be provided.

9. PAYMENTS AND COMPLETION

9.1 PAYMENTS TO DESIGN-BUILDER

9.1.1 Before the first Applicat ion for Payment and within the t ime specified in the Agreement, the Design-Builder sha ll submit to City a detailed S chedule of Values, if applicable, which shall be used as the basis for payment.

9.1.2 Within thirty (30) Days of receipt of a full and complete Application for Payment, the City will make a partial payment upon the request of the Design-Builder on the basis of an approved estimate of the Work performed during the preceding calendar month under this Contract. The City will retain from such payments five percent (5%) of the amount of each estimate until sixty (60) Days after Final Completion and acceptance by the City of all the Work covered by a Work Order Pa ckage. No such estimate or parti al payment shall be required to be made when in the judgment of the Engineer, the Work is not proceeding in accordance with the provisions of the Contract, or when in his judgment, the total value of the Work done since the last estimate is less than Five Hundred Dollars ($500.00).

9.1.3 It is mutually agreed betw een the Parties hereto that the making of any payment to the Design-Builder under this Contract or any certificate given shall not relieve the Design- Builder of his guarantee obligat ions or responsibilities under this Contract, or full compliance with the Contract Documents, including the Construction Documents (including, the Design Documents), or be c onstrued as accepting any portion of the equipment, materials or Work until a Work Order Package is fully complete and formally accepted by the City.

9.1.4 The Design-Bu ilder further agrees that the payment of the final amount due under a Work Order Package, and the adjustment and payment for any extra work done and work in accordance with any changes of the same, shall release the City of Anaheim, its officers, agents and employees from any and all claims or liability on ac count of the Work performed, and any changes thereof, and any extra work.

9.1.5 Pursuant to Public Contracts Code Section 22300, the Design-Builder may substitute securities in place of retained funds withheld by the City or, in the alternative, request that the City make payment of retentions earned directly to an escrow agent at the expense of the Design-Builder.

9.2 APPLICATION FOR PAYMENT

9.2.1 In submitting each Applicat ion For Payment, Design-Builder warrants that: title to all Work covered by each Application for Payment shall pass to the City no later than the time of payment. The Design-Builder f urther warrants that all Work covered by the previous Application for Payments are fre e and clear of liens, claims, s ecurity interest or other encumbrances.

9.2.1.1 Each Application for Payment shall:

1. Reference the Work Order Package;

2. Describe the services performed;

3. Include an estimate of the percentage of Work completed;

4. Show the total amoun t of the payment due;

5. Include a certification by a p rincipal member of the Design-Builder's firm as Design-Builder and by the Design Team Members, that the Work has been performed in accordance with the provisions of th e Contract Documents;

6. Maintain and, upon request, in clude such documentation as may be necessary to substantiate the percentage of completion of Work;

7. Include duly completed and executed forms of Conditional Wai ver and Release in accordance with California Civil Code Section 8132 of all persons eligible to file stop not ices in connection with the Wo rk covering the payment requested; and

8. Include duly completed and executed forms of Unconditional W aiver and Release, in accordance with California Civil Code Section 8134 of all persons eligible to file st op notices in connection with th e Work covering the payment received by Design-Builder for the previou s Application for Payment.

9. Include an estoppel certificate.

9.3 PAYMENT

9.3.1 Upon submission of any such Application for Payment, if C ity is satisfied that Design-Builder is making satisfactory progress toward completion of Work in accordance with the Contract Documents, City shall promptly approve the Application, in which event payment shall be made within thirty (30) Days of receipt of the Application by City. Such approval shall not be unreasonably withheld. If the City does not approve an Application for Payment, City shall notify De sign-Builder in writing of the reasons for non-approval, within seven (7) Days of receipt of the Application.

9.3.2 Subject to Sections 9.1.2 and other provisions of this Agreement and verification of the value of Work completed, the City shall pay the Design-Builder for the percentage of Work completed through the period covered by the Application fo r Payment less 5% retainage in accordance with Public Contract Code section 7201.

9.3.3 City shall have the right, but not the obligation, to make payments jointly to Design- Builder and any of its Subcontractors or suppliers.

9.4 SUBSTANTIAL COMPLETION

9.4.1 Substantial Completion is defined to mean the stage in th e progress of the Work when, in the City's sole and reasonable discretion, the Work is sufficiently complete in accordance with the Contract Documents so that City can occupy or utilize the Work for its intended use and:

1. There are no stop notice or pending claims against construct ion funds or Design-Builder has provided release bonds or other adequate security to City to satisfy such claims;

2. All systems included in the Work are operational as designed and tested;

3. Design-Builder provides evi dence that it has completed or is ready to perform designated instruction and training of City's personnel in the operations and maintenance of the Work has been completed;

4. All final finishes, fixtures and equipment required by the C ontract Documents are in place;

5. Certifications from all Desi gn Team Members that the Work ha s been completed in accordance with the design and the Contract Documents.

6. Design-Builder has submitted to City a written certification that all remaining

Work shall be completed within thirty (30) Days following the d ate of Substantial Completion and that reproducible As-Built Drawings will be completed and submitted to City within thirty (30) Days following the date of Substantial Completion.

9.4.2 When the Design-Builder considers that the Work is Substa ntially Complete, as defined herein, the Design-Builder shall prepare and submit to the City a written request for issuance of a Certificate of Substantial Completion and a comprehensive list of items to be completed. The Design-Builder shall proceed promptly to complete and correct the items.

Upon receipt of the Design-Builder’s request for issuance of a Certificate of Substantial Completion, the City will make an inspection to determine whether Substantial Completion has occurred. The City may either reject the Design-Builder’s request for issuance of a Certificate of Substantial Completion or issue a Certificate of Substantial Completion with the punchlist items of Work to be completed or corrected (“Punchlist”) and fixing the time within which Design-Builder shall complete the Punchlist items and achieve Final Completion. Failure to include an item on the Design-Builder’s list does not alter the responsibility of the Design-Builder to complete all Work in accordance with the Contract Documents.

9.5 FINAL COMPLETION AND FINAL PAYMENT

9.5.1 The Design-Builder shall, upon completion of the Work and final clean up, submit to the Engineer, a sworn Affidavit of Final Completion, signed by Design-Builder and each of the Design Team Members that to the best of the signatory’s kno wledge and belief, the Work has been completed in strict accordance with the Contract Documents, that no lawful debts for labor or materials are outstanding, that all requests for funds for undisputed Work under a Work Order Package, inclu ding changes in the Work, and under all billings of whatever nature are accurate, complete and final and that no additional compensation over and above the final payment will be requested or is due under the Contract or under any adjustment issued thereunder for s aid undisputed Work, and that upon receipt of final payment the Design-Builder will release City from all claims or liability for additional sums on account of undisputed Work. The City will inspect the Work and will either reject the request or accept the Work as evidenced by the recordation of a Notice of Completion.

9.5.2 Neither final payment nor any final release of retainage shall become due to Design- Builder until a maximum of sixt y (60) Days following completion of all Punchlist Work, issuance of a Final Certificate by the appropriate governmental agency, City’s recordation of a Notice of Completion and the Design-Builder submits to the City:

9.5.2.1 Completed and executed fo rms of unconditional waiver and release of rights from all persons eligible to file stop notices in connection with the previous application for payment;

9.5.2.2 Completed and executed fo rms of unconditional waiver and release of rights upon final payment in accordance with California Civil Code Section 8134 from all persons eligible to file stop notices in connection with the Work;

9.5.2.3 An affidavit that all pay rolls, bills for materials and e q u i p m e n t a n d o t h e r indebtedness connected with the Work for which the City might i n any way be responsible,
have been paid or otherwise satisfied;

9.5.2.4 Consent of suret y to final payment;

9.5.2.5 Data establishing paym ent or satisfaction of all obligation such as receipts, releases and waivers from all persons legally eligible to file stop notices in connection with the Work;

9.5.2.6 Submittal of three (3) hard copy sets "As-Built" drawing (24"x36") and one (1) set in the latest version of AUTOCAD format on compact disk or other City approved technology;

9.5.2.7 Submittal of warrantie s, operation and maintenance manu als and other submittals required by the Contract Documents;

9.5.2.8 Submission of Design-Bu ilder's Waiver, removal of temporary facilities and services; and

9.5.2.9 Such other documentati on as the City may reasonably require.

9.6 CITY TO WITHHOLD PAYMENT

In addition to the amount, which the City may otherwise retain under a Work Order Package, the City may withhold a s ufficient amount or amounts o f any payment or payments otherwise due the Design-Builder, as in the judgment of the Engineer may be necessary to cover:

9.6.1 Payment, which may be due, and payable for just claims against the Design-Builder or any Subcontractor for labor, materials or equipment in the performance of a Work Order Package.

9.6.2 For defective or noncom plying work not remedied.

9.6.3 For failure of the Design-Bu ilder to make proper payments to his Subcontractors.

9.6.4 Failure to withhold such amounts shall not affect any rig hts or obligations of the Design-Builder or Sureties under this Contract.

9.7 DISPUTED ITEMS

Notwithstanding any other provision in this Agreement and in accordance with applicable provisions of the Public Contract Code, in the event of a dispute between City and Design- Builder, the City may withhold fr om final payment an amount not to exceed 150% of disputed amount.

9.8 WAIVER OF CLAIMS

Acceptance of Final Payment by the Design-Builder shall constitute a waiver of affirmative claims by the Design-Builder, except those previously made in w riting and identified as unsettled of the time of final payment.

10. PROTECTION OF PERSONS AND PROPERTY

10.1 SAFETY PRACTICES

10.1.1 The Design-Builder shall provide such lights, guards, temporary fences, barricades and the like, as may be necessary to prevent damage to the work or injury to persons or property, and he shall also provide protection for adjoining property during the progress and until completion of the Work. T he Design-Builder shall abide b y all applicable Safety Orders of the Division of Industria l Safety, State of California, and Applicable Laws, and shall schedule and perform his work to avoid any danger or hazard to other contractors or workmen on a Work Order Package project, or his own men due to work being performed by others.

10.1.2 Weekly safety meetings with the Design-Builder's represe ntatives, City representatives, and the State Industrial Safety Engineer, shall be held if, in the opinion of the Engineer, Work conditions warrant such meetings.

10.1.3 Before the Notice to Proceed, the Design-Builder shall supply the City with Material Safety Data Sheets (MSDS) for all chemicals to be used in the p erformance of a Work Order Package. The City will make available to the Design-Build er the MSDS of any products in use in the areas of Work. All hazardous materials to be properly disposed of off-Site.

10.1.4 The Design-Builder is fully responsible for the safe performance of all Work for which they are contractually committed, whether performed by themselv es or by their Subcontractors. The Design-Builder shall use foresight and sha ll take such steps and precautions as its operations warrant to protect the public, City employees and agents, and its employees from danger, loss of life, or loss of property. The Design-Builder must have in place their own Injury and Illness Prevention Program as required by Labor Code § 6401.7 and Title 8 § 1509 and § 3203 of the California Code of Regulations and shall submit same to the City Safety Officer for review. California law also requires that the aforementioned program cover all employees and personnel contro lled, directed or supervised by the Design-Builder to the extent that they are exposed to worksite and job assignment specific hazards.

10.1.4.1 The program shall be wr itten and shall include but not be limited to the following elements:

10.1.4.2 Identificatio n of the person or persons responsible fo r implementing the Design-Builder's safety program . List name of the Design-Build er’s on-Site Safety Representative.

10.1.4.3 The Design-Builder's system for identifying and evaluating workplace hazards including scheduled periodic inspections to identify unsafe conditions and work practices.

10.1.4.4 The Design-Builder's m ethods and procedures for correc ting unsafe or unhealthy conditions and work practices in a timely manner. Th e Design-Builder shall correct unsafe and unhealthy conditions and work practices in a timely manner based on the severity of the hazard.

10.1.4.5 The Design-Builders o ccupational health and safety tra ining program designed to instruct employees in general safe and healthy work practices and to provide specific instruction with respect to hazards specific to each employee's job assignment.

10.1.4.6 The Design-Builder's syst em for communicating with emp loyees on occupational health and safety ma tters, including provisions de signed to encourage employees to inform the Design-Builder of hazards at the Site without fear of reprisal.

10.1.4.7 The Design-Builder's system for ensuring that employees comply with safe and healthy work practices, which may include disciplinary action.

10.1.4.8 The Design-Builder sha ll keep appropriate records of s teps taken to implement and maintain the progr am such as inspection and train ing documentation.

Design-Builder shall maintain and provide inspection checklist and training documentation forms to the City on a monthly basis.

10.1.4.9 The Design-Builder sha ll include procedures to investigate occupational injury or occupational illness.

10.1.4.10 For construction portion of a Work Order Package, the Design-Builder shall adopt a written code of safe practices which relates to the employers operations. Tailgate meetings shall be held at least weekly with employees/crews.

10.1.4.11 Unusual conditions may a rise during the Work which will require the Design- Builder to take immediate and unusual provisions to protect the public, City employees and agents, and its employees and agents from danger, loss, or damage to life and property, due directly or indirectly to prosecution of Work.

Whenever, in the opinion of the E ngineer, (a) an emergency exis ts against which the Design-Builder has not taken sufficient precaution for the publ ic safety or protection of utilities, adjacent structures or property, or (b) immediate ac tion is necessary in order to protect the public or property due to the Design-Builder's perf ormance of the Work, the Engineer may request that the Des ign-Builder provide such remed ial measures to safeguard the public and property. If the Design-Builder fails to act as required within such time required by the Engineer, the City may provide undertake the remedial measures as, in the opinion of the Engineer , may seem reasonable and necessa ry. The cost and expense of said labor and material, together with the cost and expense of such repairs as are deemed necessary, shall be borne by the Design-Builder.

The cost and expense of said labor and material, together with the cost and expense of such repairs as are deemed necessary, shall be borne by the Design-Builder. All expenses incurred by the City for emergency repairs will be charged to the Design-Builder.

If the City does not request the Design-Builder to take remedial measures or the City does take it upon itself to do so, the Design-Builder is not relieved of their full responsibility for public safety or protection of property.

10.1.5 HAZARDOUS MATERIALS

Design-Builder shall take reasonable measures to prevent the release of any Hazardous Materials brought onto the Site or adjacent areas by Design-Builder or any Subcontractor in the course of performing the Work. The Design-Builder shall imm ediately notify the City any

known spills, emissions or other releases of Hazardous Materials that occur in connection with the performance of the Work. Design-Builder shall be responsible for removing from a Site and areas adjacent thereto, and for properly disposing of, in a manner acceptable to City and in compliance with the C ontract Documents, Applicable Laws and applicable permits. In the event the Design-Builder encounters material reasonably presumed to be a Hazardous Material on a Site that existed either prior to the date of the Agreement or was not brought onto the Site by the Design-Builder, then the Design-Builder shall immediately cease performance of any Work in the area affected and report t he condition to City in writing. Design-Builder shall not thereafter resume performance of the Work in the affected area except with the prior written permission of City.

11. INSURANCE AND BONDS

11.1 INSURANCE COVERAGE

Without limiting ANAHEIM’s right to indemnification, the Parties agree that CONTRACTOR shall secure, prior to commencing any activities under the Agreement, and maintain, during the Term, insurance coverage as follows:

11.1.1. Insurance Coverage

(a)

(i) Workers’ Compensation Insurance Coverage in compliance wit h the Workers’ Compensation law of the State of California, and, if written on an out-of-state company, extended by the Broad Form All States Endorsement. If on any ex posure basis, the following shall also be provided : the United States Longshore a nd Harborworkers’ Coverage Endorsement and the Voluntary Compensation Coverage Endorsement.

(ii) Employers’ Liability Insurance Coverage subject to the mi nimum limit of Primary Liability insurance r equired to support the purchase of the Excess Liability Insurance set forth in subsection 11.1.1(d) of this Section 11. 1.1, but not less than $1,000,000 each accident, and $1,000,000 for illness/disease.

(b) Commercial General Liability Coverage, written on an occurr ence form, covering all premises and operations, includi ng without limitation independe nt contractors, subcontractors, and products and completed operations, and to b e extended by the endorsements or provisions, as applicable. The applicable limi t of liability shall be the minimum Combined Single Limit of Primary Insurance required to support the purchase of the Excess Liability Insurance set forth in subsection 11.1.1(d) of this Section 11.1.1 but not less than $4 million per occurrence. Design-Builder shall comply with the following:

(i) A Broad Form Comprehensive G eneral Liability Endorsement ( including Personal Injury and Blanket Contractual Liability Coverage) shall be provided;

(ii) An endorsement deleting the Employment and Contractual Exclusions with respect to Personal Injury Liability Coverage, if any, shall be provided;

(iii) An endorsement deleting t he Explosion, Collapse and Underground Hazards Exclusion, if any, shall be provided;

(iv) If the insurance is written with a general aggregate, the general aggregate shall be waived, by endorsement, to the extent available in the marketplace at commercially reasonable rates;

(v) If the insurance is wri tten with a general aggregate, an endorsement stating that the aggregate limits shall apply separately to this Agreement shall be provided.

(vi) If the insurance is written with a general aggregate, and if total incurred claims against the policy exceed 50% of the required aggregate limit, then such situation shall be promptly reported to City and Design-Builder shall pay to have the required aggregate limit reinstated.

(vii) The coverage for comple ted operations shall not have an expiration date.

(c) Comprehensive Automobile Liability Insurance Coverage, wri tten on an occurrence form, applicable to all of Design-Builder’s owned, hired and non-owned vehicles to be used in conjunction with this Agreement, subject to the minimum Comb ined Single Limit of Primary Insurance required to support the purchase of the Excess Liability Insurance set forth in subsection 11.1.1(d) of this Section 11.1.1 but not le ss than $2,000,000 per occurrence.

(d) Excess Liability Insurance Coverage in excess of the Underl ying Insurance described in Section 11.1.1(a), 11.1.1(b) and 11.1.1(c), written on an occurrence form. The Limit of Liability shall be in an amount that when combined with the primary insurance in 1(a), (b) and (c) will be not less than $5,000,000 per occurren ce and, if applicable, an aggregate limit of not less than $5,000,000.

(e) Professional Liability (E&O) Insurance covering all acts or omissions of Design- Builder and of Design-Builder’s architects, engineers, geo-tech s. or other design professionals, of any tier or level, including any subcontractors or consultants of any tier or level. The applicable limit of liability shall be $4,000,000 and, if written on a claims-made basis, such insurance shall be maintained for no less than two (2) years after Substantial Completion of last Work Order Package awarded under this Agreement.

(f) With respect to the interests of the Additional Insureds or Loss Payees (as hereinafter defined), such insurance shall not be invalidated by any action or inaction of Design-Builder and shall insure such Additional Insureds or Loss Payees regard less of any breach or violation of any warranty, dec laration or condition contained i n such insurance by the Design-Builder.

11.1.2. Additional Insureds. All insurance policies required pursuant to Section 11.1, except the policies in Sections 11.1.1( a) (i), 11.1.1 (e), and 11.1.1 (f) above, shall, by endorsement, include (i) Anaheim as an additional insured, as f ollows: “The City of Anaheim, its officers, agents, e mployees, and representatives a re added, jointly and severally, as additional insureds as respects the acts, omissions, operations and activities of, or on behalf of, the named insured, as respects any product s supplied to, or work or services performed under contract for, or related to, the City of Anaheim,”; and (ii) any City representatives or construction managers hired by, or on behalf of the City to work on any Work Order Package (hereinafter the “Additional Insureds”).

11.1.3. Special Provisions. With respect to the insurance specified in Section 11.1.1:

(a) Such insurance shall not be cancelled, or limited in scope or coverage, until after thirty (30) Days prior written notice has been given to the City Clerk, City of Anaheim, 200 S. Anaheim Blvd., Anaheim, CA 92805, except in the event of ca ncellation for non- payment of premium which shall provide for not less than ten (10) Days prior written notice.

(b) The insurers shall have no recourse against the Additional Insureds or Loss Payees for payment of any insurance premium; however, such Additional Insureds or Loss Payees shall have the option of paying any such premium in order to pr event cancellation of insurance for non-payment of premium.

(c) Further, with respect to the insurance referred to in Secti on 11.1.1(e), any loss payable shall be adjusted with Ci ty and, if the Design-Builder is the named insured and paid to the Design-Builder and City, for the account of all Parties as their interests appear.

(d) The Design-Builder and any c ontractors or subcontractors sh all evidence compliance with the California Wo rkers’ Compensation Law by sup plying the following attested documentation:

(i) A Workers’ Compensation ce rtificate prescribed for proof of compliance with the State Workers’ Compensation Law;

(ii) If the Design-Builder or any subcontractor shall claim t hat it is not required to carry a Workers’ Compensation Policy, a temporary permit shall be obtained by the Design- Builder or subcontractor, which shall complete all requisite documentation and send one copy of the same to City. Design-Builder shall transmit the ot her copy of the completed documentation to the California W orkers’ Compensation Board for investigation and a report; and

(iii) If the Design-Builder sha ll be self-insured for Workers’ Compensation, it shall present a certificate of self-insurance from the California Workers’ Compensation Board evidencing that fact to City.

(e) The liability insurance as is afforded by the insurance set forth in Sections 11.1.1(a) (ii), (b), (c), (d), (e), and (f) of this Section 11.1.1 shall be primary to, without the right of contribution from, any other ins urance or self-insurance carrie d or maintained by, or available to, an Additional Insured, and Design-Builder shall secure an endorsement(s) to that affect.

(f) Design-Builder shall arrange for certificates of insurance and endorsements (as required) to be issued to City and each Loss Payee by each insurance company, or their authorized representative, that issues any insurance policy set forth in Section 11.1.1 (the “Insurers”), evidencing compliance with the coverages, limits, and terms and conditions set forth herein.

(g) Design-Builder shall carry the insurance required in this S ection 11.1 with Insurers that (i) are admitted and licensed to do business in California, and (ii) have a Best’s rating of not less than A VII.

(h) In the event that a claim or other legal action is filed ag ainst City, and if City, in its

good faith opinion, believes it m ay have coverage under any of the insurance required herein, then City has the right to demand, and to receive within a reasonable time period, copies of the insurance policies related to such required insurance; provided, however, that this provision shall not apply if the parties agree that City s hall be fully defended, held harmless, and indemnified by Design-Builder against any such claim or other legal action.

(i) In addition to other remedies City may have if Design-Build er fails to provide or maintain any insurance policies or policy endorsements to the extent herein required, City may, at its sole option, order Design-Builder to stop Work unde r this Agreement and/or withhold any payment(s) which bec ome due to Design-Builder here under until Design- Builder demonstrates compliance with the requirements hereof. Exercise of this remedy is not the exclusive remedy City may have for Design-Builder's failure to maintain insurance or secure appropriate endorsements.

11.1.4. Waiver of Subrogation. D esign-Builder shall, on its own behalf and on behalf of its insurers, waive any and every claim for recovery from the Additional Insureds for any and all loss or damage resulting from or arising out of the performance of this Agreement, which loss or damage is covered by insurance policies (or deductibles or self-insurance in lieu thereof). Design-Builder agr ees (i) to give to such insur ance company which has issued, or may issue in the future, policies of insurance, written notice of the terms of this waiver of subrogation, and (ii) t o have said insurance policies properly endorsed, as applicable.

11.1.5. Insurance of Other Pers ons or Firms. In the event Design-Builder hires other persons or firms to perform some of the Work related to this Ag reement, Design-Builder shall ensure (i) that the acts or omissions of such persons or firms are covered under the above-referenced liability insurance, or (ii) that such firms maintain insurance equal to or better than, and subject to the same limits, terms and conditions as, the insurance required of Design-Builder under this Agr eement (except for firms which are not performing professional services - such f irms shall not be required to car ry the above-referenced Professional Liability Insurance); and in either instance, Desi gn-Builder shall provide, or cause to be provided, evidence of such insurance coverage, reasonably acceptable to City.

11.1.6. Carrying of Insurance No t Limiting. Nothing herein con tained in this Agreement shall be construed as lim iting in any way the extent to which Design-Builder may be held responsible for payments of damages to persons or p roperty resulting from Design-Builder’s, (or Design-Builder’s contractors/subcontractor, if any) performance of the Work covered under this Agreement.

11.1.7. Change in Requ irements. Anaheim’s Risk Manager is authorized to reduce the requirements set forth herein in the event he determines that such reduction is in City’s best interest.

11.2 BONDS

11.2.1 General. Prior to the Effective Date, the Design-Builder shall promptly furnish, at his own cost and expense, the requisite Faithful Performance and Pa yment Bonds with a responsible Corporate Surety authorized to issue such bonds in California on the bond forms provided by the City, and subject to approval of the City Attorney. The bonds shall be executed by a California admi tted surety with the Best's Ins urance Guide rating

satisfactory to the City. If a Best's Insurance Guide rating i s not available, the proposed Surety must meet comparable st andards of another rating service satisfactory to City.

Bonds issued by a surety listed in the latest version of the U. S. Department of Treasury Circular 570 shall be deemed to be accepted unless specifically rejected by City. Bonds from sureties not listed in Tre asury Circular 570 must be accom panied by all of the documents enumerated in California Code of Civil Procedure Section 995.660(a). Every Bond must display the Surety's bond number and incorporate the Contract by reference.

The terms of the Bonds shall provide that the Surety agrees that no change, extension of time, alteration or modificati on of the Contract Documents or t he Work to be performed thereunder shall in anyway affect its obligations and shall waive notice of any such change, extension of time, alteration or modification of the Contract Documents.

11.2.2 Faithful Performance Bond. From the Effective Date, Design-Builder shall furnish a Faithful Performance Bond shall be in the sum of the written in the principal amount of not less than Two Hundred Fifty Thousand Dollars ($250,000.00) and in the form set forth in Exhibit B of the Agreement. However, should the total value of all Work awarded to Design-Builder but not yet completed by Design-Builder exceed $250,000.00 at any time, Design-Builder agrees to increase the principal amount of its bonds to an amount not less than the total value of Design-Builder 's outstanding Work Order Packages. Design-Builder shall not commence any Work unless and until Design-Builder has complied with the foregoing. This higher bond am ount shall be maintained until o ne or more outstanding Work Orders Packages have been completed and a corresponding portion of the bond has been released by the City. At that time the total principal am ount of the bonds may be reduced to the new total amount o f all Work Orders then awarded . Notwithstanding the above, in no event shall the prin cipal amount of each of the bo nds be less than $250,000.00 at any time during the Term. The bond shall be furnished as a guaranty of the faithful performance of all covenants, terms, conditions and st ipulations contained in the Contract Documents including, but not limited to, the covenants that all materials used and workmanship employed in the performance of the Agreement shall be free from defects, and that should any defects ther ein appear within a period of o ne year from the date of Substantial Completion by the City, the Design-Builder shall, at his own cost and expense, repair, replace and correct such defects to the satisfaction of the Engineer within thirty (30) Days after notice thereof by the City.

11.2.3 Payment Bond. From the Effective Date, Design-Builder shall furnish a Payment Bond shall be in the sum of the written in the principal amount of not less than Two Hundred Fifty Thousand Dollars ($250,000.00 and in the form set forth in Exhibit C of the Agreement. However, should the total value of all Work awarded to Design-Builder but not yet completed by Design-Builder exceed $250,000.00 at any time, Design-Builder agrees to increase the principal amount o f its bonds to an amount not les s than the total value of Design-Builder 's outstanding Work Order Packages. Design-Buil der shall not commence
any Work unless and until Design-B uilder has complied with the foregoing. This higher bond amount shall be maintained until one or more outstanding W ork Orders Packages have been completed and a corresponding portion of the bond has been released by the City. At that time the total principal amount of the bonds may be reduced to the new total amount of all Work Orders then awarded. Notwithstanding the above, in no event shall the principal amount of each of the bonds be less than $250,000.00 at any time during the Term. The Payment Bond shall be c onditioned and provide that if the Design-Builder or Subcontractors, fails to pay for any materials, transportation, appliances, or utilities used in, upon, for or about the performance of the Work contracted to be done, or for any work or labor thereon of any kind, or for amounts due under the Unemployment Insurance Act with

respect to such work or labor, said Surety will pay the same in an amount not exceeding the sum set for above, and also in case suit is brought upon th is bond a reasonable attorney's fee to be fixed by the court.

11.2.4 CITY will not reimburse Design-Builder for the premium of the initial principal bond amount of Two Hundred Fifty Thousand Dollars ($250,000.00); however, CONTRACTOR will be allowed to include a bond fee, in the cost of each Work Order, corresponding to the value of the awarded Work Order Package.

11.3 RESPONSIBILITY FOR LOSS TO THE WORK

The Design-Builder shall take every necessary precaution against and assume all liability for injuries to persons or damages to property during the perfo rmance of a Work Order Package caused by any Work, equipment or materials furnished or the operation thereof until Final Completion and acceptance of the Work by the City.

11.3.1 Damage and Theft. The Design-Builder may insure the equipment, materials and Work to cover Design-Builder's interest in the same from time t o time, as required. The City will not, under any circumstances, be liable, answerable or accountable for any theft, loss or damage, however and by whatever cause, to said equipment, materials and work, or any part or parts thereof, used or employed in fully completing a Work Order Package, until after the Work Order Package is completed and formal acceptance of the Work by the City.

11.3.2 Alternative Blanket Insurance Policies. Alternative blanket insurance policies complying with the above requirements carried by the Design-Builder, or acceptable and approved certificates and endorsements thereof, may be substituted for specific policies upon approval by the City’s Risk Manager.

12. QUALITY AND CORRECTION OF WORK

12.1 QUALITY OF WORK AND MATERIAL

12.1.1 All Work must be done and completed in a thorough, workm anlike manner by mechanics skilled in their various trades, notwithstanding any error or omission in the Contract Documents, and all parts shall be made accurately to s tandard gauge so that renewals and repairs may be made when necessary with the least possible expense. All materials employed shall be new and homogenous and of high qual ity throughout. Any forgings and castings shall be free from flaws and imperfections, the determination of which shall follow the latest and most improved practice. All Work must be in accordance with the Contract Documents and shall be m ade to conform thereto. Any m aterial specified by reference to the number, symbol or title of a standard such as ASTM shall comply with the requirements of the latest rev isions thereof or any supplement or amendment thereto except where a different edition is specified. The referenced standards shall have the same force and effect as if they were printed in full in the Co ntract Documents. If the Design-Builder wishes to use codes or standards not specified in the Contract Documents, Design-Builder shall submit for approval sufficient information to City to determine equivalency. The Design-Builder shall be held to guarantee all material, apparatus, and equipment, to fulfill all requirements and special guarantees set forth in the Construction Documents (including, the Design Documents).

12.1.2 Should the test of any material, apparatus, or equipment show that it does not meet the guarantees or requirements of the Contract Documents, the D esign-Builder shall at once proceed to furnish such new parts as may be necessary to bring it up to requirements.

All expenses of furnishing new parts, or alteration to existin g parts, and of tests made necessary by such failure to meet the guarantees and other requ irements of the Construction Documents (including, the Design Documents), shall be at the expense of the Design-Builder.

12.2 QUALITY ASSURANCE / QUALITY CONTROL PLAN

12.2.1 General. For each Work Order Package, unless waived in writing by the City, the Design-Builder shall prepare and maintain a Quality Assurance/Q uality Control Plan (QA/QCP) to address all quantitat ive performance/specification requirements, installed conditions and operating characteristics. The QA/QCP is intend ed to document those inspections/tests necessary to assure the City that product del ivery, quality and performance are as required. It also serves as an inspection coordination tool between the Design-Builder and the City.

12.2.2 Content. For each require ment, the QA/QCP shall identif y: item/system to be tested, exact test(s) to be perf ormed, measured parameters, ins pection/testing organization, and the stage of construction development when tests are to be performed.

Organize the QA/QCP into volumes. Each inspection/test shall be coded and referenced on timeline charts to identify when tests should be performed. The Design-Builder is not relieved from required performance tests should these not be included in the plan.

12.3 UNCOVERING OF WORK

12.3.1 If a portion of the Work is covered contrary to the Engi neer’s request or to requirements specifically expre ssed in the Contract Documents, it must, if required in writing by the Engineer, be uncovered for the Engineer’s observation and be replaced at the Design-Builder’s expense without change in the Work Order Package Deadline.

12.3.2 If a portion of the Work has been covered which the Engineer has not specifically requested to observe prior to its being covered, the Engineer m ay request to see such Work and it shall be uncovered by the Design-Builder. If such Work is in accordance with the Contract Documents, cost of uncovering and replacement shall, by appropriate Change Order, be at the City’s expense. If such Work is not in accord ance with the Contract Documents, correction shall be at the Design-Builder’s expense unless the condition was caused by the City or a separate De sign-Builder in which event the City shall be responsible for payment of such costs.

12.4 CORRECTION OF WORK

12.4.1 Before Substantial Completion.

12.4.1.1 The Design-Builder shall promptly correct Work rejecte d by the Engineer or failing to conform to the requirements of the Contract Document s, whether discovered before or after Substantial Comp letion and whether or not fabri cated, installed or completed. Costs of correcting such rejected Work, including a dditional testing and

inspections and compensation for the Engineer’s services and expenses made necessary thereby shall be at the Design-Builder’s expense.

12.4.2 After Substantial Completion.

12.4.2.1 In addition to the Design -Builder’s warranty obligations under the Agreement if, within five (5) years after the date of Substantial Completion of the Work or designated portion thereof after the date for commencement of an applicable special warranty required by the Contract Documents any of the Work is found to be not in accordance with the requirements of the Contract Doc uments, the Design-Builder shal l repair or replace it promptly after receipt of written notice from the City to do so unless the City has previously given the Design-Builder a written acceptance of such condition. The City shall give such notice promptly after discovery of the condition.

12.4.2.2 The Design-Builder sha ll bear the cost of correcting d estroyed or damaged construction, whether completed or partially completed, of the City or separate Design- Builders caused by the Design-Build er’s correction or removal o f Work which is not in accordance with the requirements of the Contract Documents.

12.4.2.3 Nothing contained in thi s Section 12.4.2 shall be construed to establish a period of limitation with respect to other obligations which the Design-Builder might have under the Contract Documents. Establishment of the five (5) year period for correction of Work as described in Subsection 12.4.2.1 relates only to the specific obligation of the Design-Builder to correct the Work, and has no relationship to the time within which the obligation to comply with the Contract Documents may be sought to be enforced, nor to the time within which proceedings may be commenced to establish the Design-Buil der’s liability with respect to the Design-Builder’s obligations other than specifically to correct the Work.

13. MISCELLANEOUS PROVISIONS

13.1 GOVERNING LAW AND SERVICE OF PROCESS

13.1.1 The terms of the Contract Documents shall be interpreted according to the laws of the State of California. All matters, disputes, and lawsuits shall be filed, tried and remain in Orange County and no other venue.

13.1.2 Design-Builder hereby designates the City Clerk of the City as its local agent for service of process in any legal action or proceeding that may arise out of or in connection with this Agreement. City shall transmit to Design-Builder a c opy of any legal process served on its City Clerk on the same date such service is made, in the manner and to the address set forth herein.

13.2 SUCCESSORS AND ASSIGNS

13.2.1 The Contract Documents shall be binding upon and inure to the benefit of City and Design-Builder and their successors and assigns.

13.2.2 This Contract, nor any part thereof, shall not be assign ed, hypothecated, sold, alienated or transferred by the Design-Builder or by operation of law or otherwise, and will not be recognized or create any liability of the City thereby, with the sole exception and unless the prior formal approval of the City has been obtained thereto and the Surety has

consented thereto in writing filed with the City.

13.3 NO PERSONAL LIABILITY

No member of the City Council or other officer, employee or age nt of the City, or their consultants shall be personally responsible for any liability arising under or by virtue of the Contract or the Work performed hereunder.

13.4 INTERFERENCE

The Design-Builder shall employ, insofar as possible, such meth ods and means in the performance of the Work as will c ause the minimum of interrupti on to public utilities, or interference with the Work of the City or any other Design-Builder, or the activities of others whose property may be used by the Design-Builder.

13.5 CLEAN PREMISES

The Design-Builder shall leave all glass, plumbing fixtures, equipment, tile, paint and the Sites in clean, perfect and undamaged condition; all buildings, structures, and pavements used by Design-Builder shall be left broom clean and all debris shall be removed and disposed of by Design-Builder, and all Design-Builder's tools a nd equipment shall be removed from the premises, before acceptance of the Work by the City.

13.6 TELEPHONE

If the Design-Builder requires a telephone, he shall make all necessary arrangements and pay therefore; it shall be mainta ined in some convenient locati on as directed by the Engineer until Work is completed.

13.7 SANITARY FACILITIES

The Design-Builder shall provide adequate sanitary facilities for all construction personnel at the Sites in a location approved by the Engineer, and maintain the same in a clean and sanitary condition and also provide for the removal and disposal of all garbage, excrement and waste matter from said premises to the satisfaction of the Engineer.

13.8 ADVERTISING

No advertising of any kind or description, bill posters, printed, painted or by the use of any other method or application legi ble to human sight, shall appea r on any buildings, structures, fences, canopies, po sts or signs except valid and a uthorized legal notices required to be placed thereon.

13.9 NOISE CONTROL

The Design-Builder shall perform the Work shall be done as quietly as possible to prevent any annoyance to adjacent properties. The Design-Builder shall install noise suppression and shielding devices on all equi pment until compliance with th e requirements of all Applicable Laws is achieved. Des ign-Builder shall comply with C hapter 6.70 of the Anaheim Municipal Code and limits its Work hours accordingly.

13.10 DUST AND SMOKE CONTROL

The Design-Builder shall conduct the Work in a manner that will provide dust and smoke control consistent with applicable AQMD Rules 401 and 403 and ensure the following:

(a) No fuel shall be used nor shall any operation be conducte d that will emit into the atmosphere any smoke that is equal to Ringelmann No. 1 or darker.

(b) No operation shall be conduct ed that emit into the atmosphere any flying dust or dirt that is noticeable or t hat might constitute a nuisance to persons living nearby or occupying buildings in the vicinity of the Work.

(c) Dust control operations sha ll be performed to prevent construction operations from producing dust in amounts harmful to, or causing a nuisance to, persons living nearby or occupying buildings in the vicinity of the Work.

(d) Dry materials and rubbish s hall be wet down to prevent blowing dust.

(e) Excavated material leaving the Site, or material being imp orted, shall be covered or wet down to prevent excessive dust from being created.

13.11 AIR POLLUTION

Pursuant to Section 2449(d)(3) of Title 13 of the California Code of Regulations, Design- Builder shall ensure all self-propelled diesel-fueled vehicles, 25 horsepower and up and not designed to be driven-on road, limit idling to no more than five (5) minutes, except under the following conditions:

(a) Idling when queing;

(b) Idling to verify the vehicl e is in safe operating condition;

(c) Idling for testing, servi cing, repairing, or diagnostic purposes;

(d) Idling necessary to accomplish work for which the vehicle was designed (such as operating a crane);

(e) Idling required to bring t he machine system to operating temperature; and

(f) Idling necessary to ensure safe operation of the vehicle.

13.12 PROTECTION OF CONSTRUCTION SITES

The Design-Builder shall perform the Work in such a manner as to minimize the disruption of traffic flow. Design-Builder shall submit a Traffic Control Plan to the City's Field Engineer for review and approval at least fourteen (14) Days prior to the start of construction. This plan shall be prepared and stamped by a registered traffic engineer.

All traffic control methods shall conform to the publication en titled "State of California of Traffic Control for Construction and Maintenance Work Zone" (SA F-T Manual). Design-

Builder shall station flag perso ns at each end of the Sites whe r e i t i s n e c e s s a r y t o temporarily stop or detour traff ic for the movement of material s and equipment Design- Builder shall the flag persons with radio or cell phone to maintain communication with one another. During the construction activity hours, the Design-Builder shall ensure flagmen and workers wear bright orange vests while working in street areas. Traffic stoppages shall be limited to time periods approved by the City Engineer.

Design-Builder shall maintain pedestrian traffic in a safe manner during the construction period. Design-Builder shall maintain pedestrian and emergency vehicular access to all residences, businesses, and manufacturing establishments within the construction area.

14. TERMINATION OR SUSPE NSION OF THE CONTRACT

14.1 TERMINATIO N FOR DEFAULT

14.1.1 If the Design-Builder (a) refuses or fails to commence or prosecute the Work, or any separate part thereof, or with such diligence as will ensure its completion within the time specified in the Contract Doc uments and any authorized extensio n thereof, (b) fails to perform the Work in strict acco rdance with the Contract Documen ts, (c) fails to use an adequate number of skilled workers, (d) fails to make prompt payment to Subcontractors or for material or labor, (e) fails to install Work that is free of defects, (f) disregards Applicable Laws, or (g) breaches and other provisions of the Contract Documents, the City may serve written notice upon Design-Builder and its Surety of City’s int ention to terminate a Work Order Package or this Agreement, such notice to contain the reasons for such intention, and unless within ten (10) busine ss days after the serving of s uch notice, such violation shall cease and arrangements satisfactory to the Engineer for t he correction thereof be made, upon the expiration of said ten (10) business days Design -Builder shall be determined to be in default, and further Work thereunder by the Design-Builder shall immediately cease and terminate.

14.1.2 It is recognized that in the event a voluntary or involuntary petition in bankruptcy is filed by or against the Design-Bu ilder, or if the Design-Builder signs or makes a general assignment for the benefit of creditors, or if an application o r other procedure for appointment of a receiver for the Design-Builder or his business is favorably ruled upon by competent authority providing for such appointment of a receiver, such events could impair or frustrate Design-Builder’s performance of the Work. Accordingly, it is agreed that upon the occurrence of any such event, City shall be entitled to request of Design-Builder, or its successor in interest, in writing, adequate assurance of future performance in accordance with the Contract Documents. De sign-Builder’s failure to compl y with City’s request for adequate assurances within ten (10) Days of the request shall entitle City to terminate the Work Order Package or this Agreement.

14.1.3 In the event of any such termination as provided in Sect ions 14.1.1 and 14.1.2 above, legal title to all equipment, materials, and supplies, whether or not incorporated or installed in the Work to be done hereunder, and all construction or installations and Work done shall immediately vest in and pass to the City, and the City may take charge of the Work and complete all the Work to be furnished and done under a Work Order Package in any manner considered to be for the best interest of the City. In completing a Work Order Package, the City may take possession of and use any or all of the materials and supplies in the discretion of the City, for which the Design-Builder has a valid agreement with the supplier. The City may procure other materials, equipment, sup plies and provide the

necessary labor for the completion of the Work, and charge all the cost and expenses to fully complete the Work Order Package to the Design-Builder. In the event such cost and expense to fully complete the Work Order Package shall exceed the amount which would have been due the Design-Builder under a Work Order Package had it been completed by him, any such excess cost and expense shall be due and paid to the City by the Design- Builder and his Surety. If Design-Builder or its Surety fails to pay such amount immediately upon City’s demand, then City shall be entitled to collect inte rest from the date of said demand.

14.1.4 In lieu of entering the provisions of this Article for termination for fault, City may pay the Design-Builder for portions of Work already completed and treat the unperformed Work as if it had never been included in a Work Order Package. If this provision is invoked by City, Design-Builder shall have no claim for prospective profits on Work not performed.

14.1.5 Upon a determination by a court of competent jurisdictio n that any default termination of Design-Builder, or its successor in interest was wrongful, such termination will be deemed to be converted to a termination for convenience pursuant to the provisions of this Section 14.1 and Design- Builder's remedy for wrongful t ermination in such event shall be limited to the recovery of the payments permitted for termination for convenience as set forth herein.

14.1.6 The provisions of this Section 14.1 shall be non-exclusive, and shall be in addition to all other rights and remedies available to City under law or in equity.

14.2 TERMINATION FOR CONVENIENCE

14.2.1 City reserves the right to terminate a Work Order Packag e or this Agreement, without regard to cause or fault or breach of Design-Builder, u pon issuance of a written Notice of Termination for Convenience, effective immediately unless otherwise provided in said Notice of Termination.

14.2.2 The amount to be paid to the Design-Builder by City in the event of termination for Convenience shall consist solely of:

14.2.2.1 The cost of Work compl eted in accordance with the Contract Documents up to the date of issuance of the Notice of Termination; and

14.2.2.2 The Design-Builder's r easonable costs of demobilization for a period of thirty (30) Days following the effective date of the Notice of Termination, including costs of the Design-Builder's personnel reasonably required to effectuate th e cancellation, and such storage, transportation, and other costs incurred which are reasonably necessary for the preservation, protection or disposition of the Work.

14.2.3 In no event shall City be responsible for and Design-Builder hereby waives any claim for overhead or anticipated prof its on unperformed work or othe r economic loss upon termination for convenience.

14.3 SUSPENSION BY CI TY FOR CONVENIENCE

The City may, without cause, or der the Design-Builder in writin g to suspend, delay or interrupt the Work in whole or in part for such period of time as the City may determine. If

such suspension, delay or interruption causes the Design-Builder to incur increased cost for the performance of the Work, an adjustment to the Work Order Package Price shall be made for such costs as are directly attributable to such suspension, delay or interruption. If such suspension, delay or interruption causes a delay to the critical path of the Work, an adjustment to the Work Order Pa ckage Deadline shall be made. Al l adjustments made pursuant to this section shall be subject to, and made in accordance with Article 7.

15. LABOR CODE REQUIREMENTS AND PREVAILING WAGE RATES

15.1 In accordance with the provis ions of Division 2, Part 7, Chapter 1 of the Labor Code, the general prevailing rates of per diem wages for each craft, classification and type of Work needed to execute a Work Order Package have been determined by the Director of the California Department of I ndustrial Relations. The Design- Builder and each Subcontractor shall pay all workers not less than the prevailing wage rates as determined by the Director of Industrial Relations in accordance with the provisions of the Labor Code.

As provided in Labor Code Section 1775 the Design-Builder shall forfeit, as a penalty to the City, Fifty Dollars ($50) for each Day or portion thereof, for each workman paid less than the stipulated prevailing wage rate for such work or craft in which such workman is employed for any Work done pursuant to the Contract Documents by Design-Builder or by any Subcontractor in violation of the provisions of the Labor Code and in particular, Labor Code Section 1770 to 1780, inclusive. In addition to said pena lty and pursuant to said Section 1775, the difference between such stipulated prevailing wage rates and the amount paid to each workman shall be paid to each workman by Design-Builder.

15.1.1 Design-Builder shall strictly adhere to the provisions of the Labor Code, including Sections 1810 through 1813 and 1815, regarding minimum wages, the 8-hour day and 40- hour week, overtime, Saturday, Sunday, and holiday work. Design-Builder shall forfeit to City the penalties prescribed in the Labor Code for noncompliance, including the penalties set forth in Section 1813 for violations of Sections 1810 through 1815.

15.1.2 Design-Builder shall comply with the provisions of Labor Code, Sections 1777.5 and 1777.6, and Title 8, Code of Regulations, Sections 200 et seq., relating to apprentice employment and training. Design-Builder shall assume full responsibility for compliance with said sections with respect to all apprenticeable occupatio ns on any Work Order Package project. To ensure compliance and complete understanding of the law regarding apprentices, and specifically the required ratio thereunder, Design-Builder should, where some question exists, contact the Division of Apprenticeship Standards, 455 Golden Gate Avenue, San Francisco, CA 94102, or one of its branch offices, prior to commencement of the Work. In the event of noncompliance by Design-Builder, Cit y shall withhold the penalties provided for under Section 1777.7 of the Labor Code f rom progress payments then due.

15.1.3 Pursuant to the requirements of Section 1860 of the Labor Code, Design-Builder will be required to secure the payment of workers’ compensation to h is employees in accordance with the provisions of Section 3700 of the Labor Code.

15.1.4 Pursuant to Section 1861 of the Labor Code, Design-Builder is obligated to sign and file with City a certification in the form included in Attachment 2.

15.1.5 Design-Builder shall comply with the applicable provisions of the Labor Code and implementing regulations relating to Labor Nondiscrimination.

15.2 Pursuant to the provisions o f Section 1770 of the Labor Co de of the State of California, the Director of the Department of Industrial Relati ons has ascertained the general prevailing rate of wages (which rate includes employer payments for health and welfare, vacation, pensions and similar purposes) applicable to the Work to be done, for straight time, overtime, Satur day, Sunday and holiday work. The Design-Builder shall obtain a copy of prevailing wage rate determinations of the Director of the Department of Industrial Relations and post it in a conspicuous place on the Sites.

15.3 The City will not recognize any claim for additional compe nsation because of the payment by the Design-Builder of any wage rate in excess of the prevailing wage set forth in a Work Order Package. The possibility of wage increases is one of the elements to be considered by the Design-Builder in determining his bid, and wi ll not under any circumstances be considered as the basis of a claim against the City on the Work Order Package.

15.4 The Design-Builder shall maintain accurate payroll records in accordance with the provisions of Labor Code Section 1776 and shall, upon request, file said records with the City.

15.5 The Design-Builder shall forfeit as a penalty to the City Twenty Five Dollars ($25) for each worker employed in the execution of the Work by the Design -Builder or any Subcontractor for each Day during which such workman is required or permitted to work more than eight (8) hours in any one Day and forty (40) hours in any one calendar week, in violation of the provisions o f the Labor Code and, in particula r, Section 1810 to Section 1815 thereof, inclusive, except that Work performed by the employees of Design-Builder or Subcontractor in excess of eight (8) hours per day and forty (4 0) hours during any one week shall be permitted upon compensation of all hours worked in excess of eight (8) hours per day at not less than one and one-half times the basic rate of pay as provided in said Section 1815.

15.6 Attention is directed to t he provisions in Section 1777.5 and 1777.6 of the Labor Code concerning the employment o f apprentices by the Design-Bui lder or any Subcontractor under him.

15.7 The Design-Builder and any Subcontractor under him shall c omply with the requirements of Section 1777.5 and 1777.6 in the employment of apprentices.

15.8 Information relative to apprenticeship standards, wage sch edules, and other requirements may be obtained from the Director of Industrial Re lations, Office of the Administrator of Apprenticeship, San Francisco, California, or from the Division of Apprenticeship Standards and its branch offices.

15.9 This Contract is subject to Public Contract Code Section 6 109: The Design Builder shall be prohibited from performing Work with a subcontractor who is ineligible to perform the Work pursuant to Sections 1777.1 or 1777.7 of the Labor Code.

16. POTHOLING AND LOCATING EXI SITING UNDERGROUND UTILITIES

The Design-Builder is responsible for investigating and locatin g existing underground utilities, and for determining the need for and performing any necessary Work for

conducting potholing, including where connection to an existing utility is required, prior to submitting shop drawings for the construction.

All costs incurred in exposing and locating the existing utilit ies including all labor, tools, equipment for excavation, backfill, restoring existing surface and Site improvements, shall be included in the Work Order Package Price.

Without any adjustment to the Work Order Package Price or contribution from the City, the Design-Builder shall bear the cost of repairing or replacing any existing utility damaged by his potholing work to the satisfaction of the owner of the affected utility.

ATTACHMENT 1

SUMMARY OF PUBLIC CONTRACT CODE SECTION 9204

Definitions:

(1) “Claim” means a separate demand by a contractor sent by registered mail or certified mail with return receipt requested, for one or more of the following:
(A) A time extension, including, without limitation, for relief from damages or penalties for delay assessed by a public entity under a contract for a public works project. (B) Payment by the public entity of money or damages arising fr om work done by, or on behalf of, the contractor pursuant to the contract for a public works project and payment for which is not otherwise expressly provided or to which the claimant is not otherwise entitled. (C) Payment of an amount that is disputed by the public entity.

(2) “Contractor” means any type of contractor within the meanin g of Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code who has entered into a direct contract with a public entity for a public works project.

(3) (A) “Public entity” means, without limitation, except as pr ovided in subsection (B), a state agency, department, office, division, bureau, board, or c ommission, the California State University, the University of California, a city, includi ng a charter city, county, including a charter county, cit y and county, including a charte r city and county, district, special district, public authority, political subdivision, public corporation, or nonprofit transit corporation wholly owned by a public agency and formed to carry out the purposes of the public agency.
(B)…

(4) “Public works project” means the erection, construction, al teration, repair, or improvement of any public struc ture, building, road, or other p ublic improvement of any kind.

(5) “Subcontractor” means any ty pe of contractor within the mea ning of Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code who either is in direct contract with a contractor or is a lower tier subcontractor.

Claim Procedure:

(1) (A) Upon receipt of a claim pursuant to this section, the public entity to which the claim applies shall conduct a reasonable review of the claim and, within a period not to exceed 45 days, shall provide the claimant a written statement identifying what portion of the claim is disputed and what portion is undisputed. Upon receipt of a claim, a public entity and a contractor may, by mutual agreement, extend the time period provided in this subdivision. (B) The claimant shall furnish reasonable documentation to support the claim. (C) If the public entity needs approval from its governing body to provide the claimant a written statement identifying the disputed portion and the undisputed portion of the claim, and the governing body does not meet within the 45 days or within the mutually agreed to extension of time following receipt of a claim sent by registered mail or certified mail, return receipt requested, the public ent ity shall have up to three day s following the next duly publicly noticed meeting of the governing body after the 45-day period, or extension,

expires to provide the claimant a written statement identifying the disputed portion and the undisputed portion.
(D) Any payment due on an undisputed portion of the claim shall be processed and made within 60 days after the public entity issues its written statement. If the public entity fails to issue a written statement, paragraph (3) shall apply.

(2) (A) If the claimant disputes the public entity’s written response, or if the public entity fails to respond to a claim issued pursuant to this section within th e time prescribed, the claimant may demand in writing an informal conference to meet and confer for settlement of the issues in dispute. Upon receipt of a demand in writing sent by registered mail or certified mail, return receipt requested, the public entity shall schedule a meet and confer conference within 30 days for settlement of the dispute. (B) Within 10 business days following the conclusion of the meet and confer conference, if the claim or any portion of the claim remains in dispute, the public entity shall provide the claimant a written statement identifying the portion of the claim that remains in dispute and the portion that is undisputed. Any payment due on an undisputed portion of the claim shall be processed and made within 60 days after the public entity issues its written statement.

Any disputed portion of the claim, as identified by the contrac tor in writing, shall be submitted to nonbinding mediati on, with the public entity and t he claimant sharing the associated costs equally. The public entity and claimant shall mutually agree to a mediator within 10 business days after the disputed portion of the claim has been identified in writing.

If the parties cannot agree upon a mediator, each party shall select a mediator and those mediators shall select a qualified neutral third party to mediate with regard to the disputed portion of the claim. Each party shall bear the fees and costs charged by its respective mediator in connection with the selection of the neutral mediat or. If mediation is unsuccessful, the parts of the claim remaining in dispute shall be subject to applicable procedures outside this section.

(5) If a subcontractor or a lower tier subcontractor lacks lega l standing to assert a claim against a public entity because privity of contract does not exist, the contractor may present to the public entity a claim on behalf of a subcontractor or lo wer tier subcontractor. A subcontractor may request in writing, either on his or her own behalf or on behalf of a lower tier subcontractor, that the contractor present a claim for work which was performed by the subcontractor or by a lower tier subcontractor on behalf of the subcontractor. The subcontractor requesting that the claim be presented to the pub lic entity shall furnish reasonable documentation to support the claim. Within 45 days o f receipt of this written request, the contractor shall notify the subcontractor in writing as to whether the contractor presented the claim to the public entity and, if the original c ontractor did not present the claim, provide the subcontractor with a statement of the reasons for not having done so.

ATTACHMENT 2

I am aware of the provisions o f Section 3700 of the Labor Code which require every employer to be insured against li ability for worker’s compensat ion or to undertake self- insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of this Agreement.

S i g n e d : _________ _________________

N a m e / T i t l e :

Dated: _________________ ____________________

Company: _________________ ____________________

END OF GENERAL CONDITIONS