Agreement Between Contractor and Subcontractor
Agreement made on the ________________ (date) , between ____________________
(Name of Subcontractor) of ____________________________________________________
_______________________ (street address, city, state, zip code) , referred to herein as
Subcontractor , and _______________________ (Name of Contractor) , a corporation
organized and existing under the laws of the state of ______________, with its principal office
located at ____________________________________________________________________
____________ (street address, city, state, zip code) , referred to herein as Contractor .
For and in consideration of the mutual covenants contained in this Agreement, and other
good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties agree as follows:
1. Original Contract
Contractor has entered into a contract (the Original Contract), dated ________________
(date) , with _____________________ (name of Owner) (the Owner ), for the construction of
(description of work to be done) ________________________________________________,
which Contract includes the work to be done under and pursuant to this Subcontract
Agreement.
2. Scope of Work
The labor and materials to be furnished and the work to be done by Subcontractor are
as follows: (Describe labor and materials to be furnished and work to be done by
Subcontractor) ______________________________________________________________
____________________________________________________________________________
____________________________________________________________________________.
3. Performance of Work
A. Subcontractor shall furnish all supervision, materials, supplies, and equipment,
except as otherwise provided in this Agreement , and perform all labor required for the
completion of the above-described work in accordance with all provisions of the Original
Contract and of the specifications, plans, and addenda referred to in the Original
Contract, all of which are made a part of this Agreement , and to the satisfaction of
Owner and Contractor .
B. One set of plans and specifications will be furnished to Subcontractor without
cost. Additional sets may be procured at rates established by Owner, to be available at
Contractor's office at the address set forth above.
4. Compensation
Contractor, for the full, complete, and faithful performance of this Subcontract, agrees to
pay Subcontractor as full compensation: (description or schedule of compensation) ______
___________________________________________________________________________.
5. Completion
Subcontractor shall, after notice to proceed by Contractor, commence work at such
points as Contractor may designate and continue diligently in the performance of such work.
Subcontractor shall employ sufficient crews and work sufficient hours or shifts so as not to
hinder or delay the actual progress of Contractor or other Subcontractors and in any event shall
complete the several portions and whole of the work at such times as will enable Contractor to
fully comply with the terms of the original contract.
6. Reimbursement for Damages or Cost
Subcontractor shall reimburse Contractor for any actual damages or costs incurred by
reason of Subcontractor's failure to prosecute the work diligently, including any liquidated
damages assessed by Owner pursuant to original contract.
7. Takeover by Contractor
Should Subcontractor fail or neglect to proceed diligently, timely, competently, or should
Subcontractor be delaying, interfering with, or jeopardizing the timely or satisfactory completion
of the work under the Original Contract, then and in that event Contractor, in his discretion,
reserves the right, after giving ________ (number) hours notice, written or oral, to take over the
work and complete such work at the cost and expenses of Subcontractor, without prejudice to
Contractor's other rights or remedies for any loss or damages sustained, and in the event of
such takeover, Subcontractor agrees that no material, machine, or tools belonging to
Subcontractor shall be removed from the job until completion. Previous demands made on
Subcontractor not followed by a takeover shall not be deemed a waiver of Contractor's rights to
do so.
8. Permit
Subcontractor shall obtain and pay for all permits, passes, clearances, licenses,
franchises, and other instruments and processes required in the performance of his work under
and pursuant to this Agreement.
9. Payment and Performance Bond
Subcontractor shall furnish a $ ___________ payment and performance bond acceptable
to Contractor prior to performing any work under this Agreement .
10. Indemnification
Subcontractor shall assume full responsibility for his employees, officers, agents,
and business invitees. Subcontractor agrees to hold and save Contractor harmless from and
against any claim, demand, action or cause of action that may be asserted by any person
arising out of injury or death suffered by any of Subcontractor's employees, officers, agents, and
business invitees, including, but not limited to, third-party actions for injury or death otherwise
covered under applicable workers' compensation laws and regardless of the sole or concurring
negligence of Contractor.
11. Insurance
Subcontractor shall furnish certificates of insurance coverage as follows in the following
or minimum legal limits, whichever is greater:
A. Workers' Compensation.
Legal limits or, otherwise in location where the State of _________________ (state)
provides insurance, evidenced that Subcontractor is in good standing.
B. Comprehensive general liability insurance.
Bodily injury in the amount of $__________for each person; bodily injury in the
amount of $______________ for each accident; property damage (including blasting,
collapse, and underground coverage) in the amount of $_____________ for each
occurrence.
C. Automobile liability insurance.
Bodily injury in the amount of $_____________ for each person; bodily injury in
the amount of $_____________ for each accident; property damage in the amount of
$_____________ for each occurrence.
Note: Certificates evidencing the insurance coverage required by this Agreement must
be furnished in duplicate before performing any work at the construction site. The
certificate shall provide that _______ (number) day’s written notice will be given
Contractor, prior to any change or cancellation.
E. If any work to be performed under this Agreement is further sublet, Subcontractor
will be required to arrange for insurance as provided in this Agreement.
12. Payment
A. Partial payments for work performed under this Agreement will be made by
Contractor within ______ (number) days after being paid for such work by Owner and
will equal the value of the work done by Subcontractor according to Owner's estimate at
applicable unit prices or percentage of total completion, whichever is applicable, less the
sum of previous payments and less a percentage equal to the percentage retained by
Owner, provided, that if Subcontractor is indebted to Contractor or anyone else for cash
advances, supplies, materials, equipment, rental, or other property charges against the
work, the amount of such indebtedness may be deducted from any payment or
payments made under this provision.
B. Prior to final payment, Subcontractor will be required to furnish proof of payment
for all taxes due. Subcontractor will further be required to furnish certification that all
materials, labor, and applicable taxes have been paid.
C. On completion of the Original Contract and payment under that Contract in full by
Owner, Subcontractor will be paid the remaining amount due Subcontractor under this
agreement. All prior partial payments shall be subject to correction in the final payment.
D. Estimates and calculations made by Owner, or Owner's engineers, as to the
amount of work done by Subcontractor shall be final and binding on the parties to this
Agreement and shall conclusively establish the amount of work done by Subcontractor.
All statements for which payment is requested by Subcontractor shall be in the office of
Contractor on or before the last day of the Contract pay period for work done the
preceding month.
13. Changes, Extra Work, and Disputes
A. Changes in Original Contract. Contractor is not an insurer or guarantor of the
work or any part of the work, of the performance by Owner of the Original Contract, or of
plans and specifications furnished by Owner. Subcontractor shall be bound by any
changes or alterations made by Owner to the original contract specifications or plans, or
in the amount or character of the work or any part of the work, to the same extent that
Contractor is bound by any such change or alteration.
B. Notice of Change Order. Subcontractor will be notified of any change order
requested by or of Owner with respect to subcontract work and will be consulted with
respect to the proposed terms of any such change order, but Subcontractor shall be
bound by the terms of any change order negotiated in good faith by Contractor with
Owner. Contractor shall be entitled to a reasonable overhead and profit on any change
order issued by Owner with respect to subcontract work. If the parties cannot agree,
Subcontractor shall nevertheless proceed with the change order work and the question
of reasonable overhead and profit of contractor shall be submitted to arbitration under
the laws of _________________ (state) relating to arbitration.
C. Notice to Contractor. Subcontractor is bound to the terms of the Original
Contract relating to changes, changed conditions, extra work, Owner-furnished property,
and disputes and shall give to Contractor immediate written notice of any such asserted
change, changed condition, extra or disputed claim, to the end that Contractor may
timely comply with any notice requirements of the Original Contract relating to such
matters.
D. Extra Compensation. Subcontractor waives any claim against Contractor for
compensation or equitable adjustment for such claims, changed conditions, or extra
work, except to the extent that any such claim is allowed to Contractor by Owner as
provided in this Agreement . Contractor will pay to Subcontractor, from any such extra
compensations or equitable adjustment received from Owner with respect to subcontract
work, as and when received from Owner, the actual costs of the extra labor or materials
of Subcontractor allowed plus ____________ (fraction) of the overhead and/or profit
allowed but in no event to exceed the sum received by Contractor from Owner.
E. Claims for Extra Work. With respect to any extra work ordered by Contractor for
his own convenience and not related to a change, changed condition, or extra work
under the Original Contract, Subcontractor shall make no claim for compensation unless
it shall have been fully agreed upon in writing by Contractor prior to the performance of
such extra work. Such Agreement shall set forth the extra work to be done, the
compensation for such extra work, and any extension of time necessarily occasioned by
such extra work. Contractor may order extra work without invalidating this Subcontract. If
the parties cannot agree upon the compensation or time extensions, Subcontractor shall
nevertheless proceed with such extra work and the question of entitlement or amount of
compensation and/or extensions of time shall be submitted to arbitration pursuant to
Section 30 below.
F. Unit Price. If this Subcontract Agreement is upon a unit price, any quantities and
amounts mentioned are approximate only and may increase or decrease at the same
unit price unless the Original Contract warrants or guarantees such quantities and
amounts.
G. Cooperation. Contractor shall cooperate with Subcontractor in submitting claims
to Owner for changes, changed conditions, and the like, with respect to subcontract
work, but this shall not be interpreted as an attempt to create any direct contractual
relationship between Subcontractor and Owner or to permit Subcontractor to engage in
direct negotiations with Owner.
H. Cost. All cost, including attorneys' fees, incurred in any arbitration or other claim
proceeding for the benefit of Subcontractor shall be borne solely by Subcontractor. No
change or extra work ordered by either Owner or Contractor shall invalidate any bond or
bonds to be furnished by Subcontractor.
14. Subcontract Approval and Renegotiation
A. This Subcontract Agreement is subject to approval by Owner but shall be
effective in absence of specific written disapproval by Owner.
B. This Subcontract is subject to applicable current codes and statutes regarding
renegotiations.
15. Payrolls
A. Payrolls and affidavits covering all labor performed by Subcontractor under and
pursuant to this Subcontract Agreement will be submitted directly to Contractor at the address
set forth above unless otherwise directed by Contractor .
B. It is required that weekly payrolls and affidavits of Subcontractor be submitted, in
the format described in the contract specifications within _______ (number) days after
the normal weekly payday.
C. Payrolls must set out accurately and completely the name, exact occupation,
hourly wage rate, hourly overtime wage rate, hours worked each day, total regular and
total premium time hours worked each week, gross pay, deductions (listed separately
and clearly identified), and net amount paid to each employee. A letter requesting
permission for all deductions must be submitted to Contractor prior to first payroll. An
affidavit must accompany each payroll describing all deductions taken on each weekly
payroll.
16. Contractors Hired by Subcontractor
Subcontractor shall not sublet the work to be performed under this Agreement either in
whole or in part without the prior, express, and written consent of Contractor . All subcontracts
under this Agreement shall be subject to the provisions of the original Contract and this
Agreement but shall create no contractual relationship with Contractor. All payroll regulations
and requirements will apply to Subcontractors under this Subcontract Agreement.
17. Engineering
Subcontractor shall furnish all layout and engineering in connection with his work,
unless specifically provided for otherwise, conforming with the initial lines and grades
established in the Original Contract. Subcontractor shall be responsible for all shop drawings
and as built drawings if required under the Original Contract.
18. Temporary Utilities
Utilities of the nature normally mobilized by Contractor (water, power, telephone, storage
space and the like) will be made available for Subcontractor's use for a nominal fee, contingent
upon overall job requirements and needs of others. If Contractor has facilities available for
board and lodging of employees, the facilities will be made available to Subcontractor's
employees, when space is available, at the rate established for the project. Contractor will not,
however, guarantee availability of facilities unless specifically provided for otherwise.
19. Special Provisions
Subcontractor shall comply with all federal, state, territorial, and local codes and statutes
of the area involved and shall indemnify Contractor against any and all claims or liens as a
result of acts or omissions on part of Subcontractor with respect to any noncompliance with
such codes and statutes.
20. Public Protection
A. Subcontractor shall provide, erect, and maintain proper warning signals, signs,
lights, barricades, and fences on and along the line of the work and shall take all other
necessary precautions for the protection of the work and safety of the public.
B. Subcontractor shall indemnify Contractor from and against any and all liability for
damage to the work or for injury or damage to persons or property occurring on or about
the project work area or in connection with the work.
21. Cooperation
A. Subcontractor shall cooperate fully with other Subcontractors employed on the
work and shall so plan and conduct the work to be performed under and pursuant to this
Agreement as not to interfere with their operations.
B. Contractor will not be responsible for any delays or interference resulting from
the acts or operations of other Subcontractors, suppliers, or organizations.
22. Safety
A. Subcontractor shall cooperate with Contractor and Owner in efforts to prevent
injuries to any workers employed in carrying on operations covered by this Agreement
and to adopt and place in effect such reasonable practical suggestions as may be
offered by Contractor or Owner to promote safety and safe working conditions.
B. Should Subcontractor consistently fail to maintain his equipment in safe
operating condition or should Subcontractor's operation be characterized by abnormally
frequent injuries to workers, then at the option of Contractor , this Agreement may be
cancelled, upon ________ (number) days written notice to Subcontractor , and
Subcontractor is required to remove immediately all of his equipment and employees
from the work site.
23. Guarantee
Subcontractor agrees to guarantee the quality of all subcontract work and materials for
such period as is required of Contractor by Owner.
24. Clean-up
On completion of any unit of the work, and on final completion of the work,
Subcontractor shall clean up all refuse and rubbish around or alongside the work caused by
Subcontractor and to remove promptly all excess materials, tools, structures, and the like that
may have been brought on the work site or erected by Subcontractor. In the event of the failure
of Subcontractor to do so, contractor may, after giving reasonable notice, clean up the premises
at the cost and expense of Subcontractor.
25. Severability
The invalidity of any portion of this Agreement will not and shall not be deemed to affect
the validity of any other provision. If any provision of this Agreement is held to be invalid, the
parties agree that the remaining provisions shall be deemed to be in full force and effect as if
they had been executed by both parties subsequent to the expungement of the invalid provision.
26. No Waiver
The failure of either party to this Agreement to insist upon the performance of any of the
terms and conditions of this Agreement, or the waiver of any breach of any of the terms and
conditions of this Agreement, shall not be construed as subsequently waiving any such terms
and conditions, but the same shall continue and remain in full force and effect as if no such
forbearance or waiver had occurred.
27. Governing Law
This Agreement shall be governed by, construed, and enforced in accordance with the
laws of the State of _______________.
28. Notices
Any notice provided for or concerning this Agreement shall be in writing and shall be
deemed sufficiently given when sent by certified or registered mail if sent to the respective
address of each party as set forth at the beginning of this Agreement.
29. Attorney’s Fees
In the event that any lawsuit is filed in relation to this Agreement, the unsuccessful party
in the action shall pay to the successful party, in addition to all the sums that either party may be
called on to pay, a reasonable sum for the successful party's attorney fees.
30. Mandatory Arbitration
Any dispute under this Agreement shall be required to be resolved by binding arbitration
of the parties hereto. If the parties cannot agree on an arbitrator, each party shall select one
arbitrator and both arbitrators shall then select a third. The third arbitrator so selected shall
arbitrate said dispute. The arbitration shall be governed by the rules of the American Arbitration
Association then in force and effect.
31. Entire Agreement
This Agreement shall constitute the entire agreement between the parties and any prior
understanding or representation of any kind preceding the date of this Agreement shall not be
binding upon either party except to the extent incorporated in this Agreement.
32. Modification of Agreement
Any modification of this Agreement or additional obligation assumed by either party in
connection with this Agreement shall be binding only if placed in writing and signed by each
party or an authorized representative of each party.
33. Assignment of Rights
The rights of each party under this Agreement are personal to that party and may not be
assigned or transferred to any other person, firm, corporation, or other entity without the prior,
express, and written consent of the other party.
34. In this Agreement, any reference to a party includes that party's heirs, executors,
administrators, successors and assigns, singular includes plural and masculine includes
feminine.
WITNESS our signatures as of the day and date first above stated.
____________________________
(Name of Contractor)
________________________ By:________________________________
(P rinted name) ________________________________
________________________ (P rinted name & Office in Corporation)
(Signature of Subcontractor) ________________________________
(Signature of Officer)