Contract Flowdown Addendum

CONTRACT FLOWDOWN ADDENDUM

This Contract Flowdown Addendum (the Addendum) is entered into as of by and between Contractor Name: , a company with principal place of business at and Subcontractor Name: , located at .

RECITALS

WHEREAS, Contractor and Subcontractor are parties to a subcontract for the performance of certain work described in the subcontract; and

WHEREAS, Contractor is obligated under a prime contract with the owner (Prime Contract No.: ) to cause certain obligations to be imposed on Subcontractor as flowdown obligations; and

WHEREAS, the parties desire to set forth the specific terms and conditions to be flowed down from the Prime Contract to Subcontractor.

NOW, THEREFORE

In consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows:

1. INCORPORATION OF PRIME CONTRACT

The parties acknowledge that the terms, conditions, and requirements of the Prime Contract identified above are incorporated into this Addendum by reference to the extent they are applicable to the subcontracted work. Subcontractor shall perform its obligations in conformity with all applicable clauses of the Prime Contract, including but not limited to schedules, specifications, quality requirements, safety provisions, and any flowdown clauses enumerated in the Prime Contract.

2. FLOWDOWN OBLIGATIONS

Subcontractor expressly agrees to be bound by, and to comply with, all flowdown obligations required by the Prime Contract to the extent they are applicable to the Work. Without limiting the foregoing, Subcontractor shall comply with the provisions described in the flowdown summary attached hereto or listed below and such provisions shall have the same force and effect as if set forth in full herein.

3. SUBCONTRACTOR OBLIGATIONS

Subcontractor shall perform the Work in accordance with the schedule, specifications, and quality standards set forth in the subcontract and the Prime Contract. Subcontractor shall furnish all labor, materials, equipment, supervision and services necessary to perform the Work and shall be solely responsible for the means, methods, techniques and sequences of performance except as otherwise specified in the Prime Contract.

4. COMPENSATION; PAYMENT FLOWDOWN

Contractor shall pay Subcontractor in accordance with the subcontract. Subcontractor acknowledges that payment from Contractor to Subcontractor may be conditioned upon Contractor's receipt of payment from the owner under the Prime Contract. Subcontractor shall provide invoice documentation, certified payroll, and any other payment supporting documentation required by Contractor or the Prime Contract.

5. INSURANCE AND INDEMNITY

Subcontractor shall maintain insurance coverages meeting or exceeding those required by the Prime Contract and shall name Contractor as an additional insured where required. Subcontractor shall indemnify, defend and hold Contractor, its officers, agents and employees harmless from and against any and all claims, liabilities, losses, damages, costs and expenses (including reasonable attorneys' fees) arising out of or resulting from Subcontractor's performance under this Addendum, except to the extent caused by Contractor's gross negligence or willful misconduct.

6. AUDIT; RECORDS

Subcontractor shall maintain complete and accurate books, records and accounts in accordance with generally accepted accounting principles and shall retain such records for a period of not less than three (3) years following final payment or for such longer period as required by the Prime Contract. Contractor and Owner, and their authorized representatives, shall have the right to audit and inspect such records during normal business hours upon reasonable notice.

7. TERMINATION

In the event of termination of the Prime Contract or Contractor's subcontract with the owner, Contractor may terminate the Subcontractor's work in whole or in part upon written notice to Subcontractor. Upon such termination, Subcontractor shall be entitled to payment for Work performed and accepted prior to termination in accordance with the subcontract and this Addendum, less any setoffs or claims arising from Subcontractor's breach.

8. CONFIDENTIALITY

Subcontractor shall maintain the confidentiality of all information designated by Contractor or the owner as confidential, proprietary or trade secret, and shall use such information only for purposes of performing the Work. This obligation shall survive termination or expiration of this Addendum.

9. REMEDIES; NO LIMITATION

All remedies available to Contractor under this Addendum, at law or in equity shall be cumulative and may be exercised singularly or concurrently. Nothing in this Addendum shall limit or diminish Contractor's rights under the Prime Contract.

10. NOTICES

All notices required or permitted under this Addendum shall be in writing and shall be delivered personally, by nationally recognized overnight courier, or by certified mail, return receipt requested, to the addresses set forth below or to such other address as a party may designate by written notice.

11. AMENDMENT; WAIVER; COUNTERPARTS

This Addendum may be amended only by a written instrument executed by both parties. No waiver of any breach shall be effective unless in writing and signed by the party granting the waiver. This Addendum may be executed in counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

12. GOVERNING LAW; ENTIRE AGREEMENT; SEVERABILITY

This Addendum shall be governed by and construed in accordance with the laws of the jurisdiction identified below without regard to conflict of law principles. This Addendum, together with the subcontract and the applicable flowdown requirements of the Prime Contract, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements and understandings, whether written or oral. If any provision of this Addendum is held to be invalid or unenforceable, the remaining provisions shall continue in full force and effect.

CERTIFICATION

Each party certifies that the individual executing this Addendum on its behalf has full authority to bind such party. Subcontractor certifies that it has reviewed the flowdown provisions and understands and accepts the obligations imposed on it by this Addendum.

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