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COM 0082.027 2004-2006
MYY Oi M~ Harry Kim ~ • Jane H. Testa Muyor Director ~ Diane L. Ley h•oi'M~'~' Depuq• Direcmr County of Hawaii DEPARTMENT OF RESEARCH AND DEVELOPMENT 25 Aupuni Strect, Room 109 • Hilo, Hawaii 96720-4252 (806)961-8366 • Fax (808) 935-1205 E-mail: chresdcv@inlcrpaancl DATE: March 15, 2006 TO: Stacy K. Higa, Council Chair and Council Members VIA: Deanna Sako, Controller FROM: ~ Jane Testa, Director RE: NOTIFICATION OF GRANT AWARD Compliance with Ordinance No. OS-86, Section 7(I) Name of Grant Program: County Product Enrichment Program Grantor: State of Hawaii - Hawaii Tourism Authority County Grantee Department or Agency: Dept. of Research and Development Grant No. (IF KNOWN): Amount of Grant: $400,000. Amount of County Match: -0- County Revenue & Expenditure Account Numbers: Rev. 3305.23; Exp. 010-161-5162.99 Grant Period (Commencement & Completion): 1/1/06-12/31/06 Purpose of Grant: Support and improve the tourism product development initiatives and programs. Is final report required by grantor? Yes ? No Notification attached: ©Yes ~ No, because Gomm No. g2. 27 Ref, To: Ref. Uata roi„~ rvcnl uus STATE OF HA WAH CONTRACT FOR GOODS AND SERVICES (]N THE FOLLOWING CATEGORIES: EXEMPT; SMALL PURCHASE; SOLE SOURCE; OR EMERGENCI~ This Contract, executed on the respective dates indicated below, is effective as of 20~ between Department of Business, Economic Development, and Touris (Insert name ojttafe deparlmenl, agenry, board w canmiuionJ State of Hawaii (hereinafter "STATE"), by its State Director Qnrerf tide o/person signingjorSlafeJ (hereinafter"PROCUREMENTOFFICER'~, whose address is No. 1 Capitol District Building 250 S. Hotel St Honolulu. HI 96813 and The Countv of Hawaii (lnterl fame ojcompany/personJ (hereinafter "CONTRACTOR'~,aCounty in the State of Hawaii (/ntert carporanon, parmnsh~p,~omf vennve, sole propnetorshy, W often /ega/jars, oj/he Contrvc(orJ under the laws of the State of Hawaii _ whose business address and taxpayer identification number are as follows: 25 Aupuni St. , Room 219, Hilo, Hawaii 96720 RECITALS A. The STATE is in need of the goods or services, or both, (also referred to as "goods and services', described in this Contract and its attachments. The CONTRACTOR is agreeable to providing the goods and services. B. This Contract is for (check one box): ® (1) A procurement expenditure ofpublic funds for goods and services that is otherwise exempt from public bidding as set forth in section ] 03D-102, Hawaii Revised Statutes (HI2S), and chapter 3-]20, Hawaii Administrative Rules (HAR); or HRS 103D-102 (b) (3 ) or ? (2) A small purchase procurement of goods and services as set forth in section ]03D-305, HRS, and subchapter:8, chapter 3-122, HAR; or ? (3) A sole source procurement of goods and services as set. forth in section ] 03D-306, HRS, and subchapter 9, chapter 3-122, HAR; or ? (4) An emergency procurement of goods and services as set forth in section ] 03D-307, HRS, and subchapter ] 0, chapter 3-] 22, HAR. 1 AG/SPO FORM-K(2) (]/Ol) C. Money is available to fund this Contract pursuant to: (1) (/den~~Sm~esources) or (2) U. S. Department of Energy, State Energy Program grant (/deny Federal swrcef or both, in the following amounts: State $ Federal $ 59,600.00 D. The agency's Chief Procurement Officer is Ruth "amaguchi who O has approved this procurement or ?is not required to approve this procurement. NOW, THEREFORE, in consideration of the promises contained in this Contract, the STATE and the CONTRACTOR agree as follows: 1. Scope of Services. The CONTRACTOR shall, in a proper and satisfactory manner as determined by the STATE, provide all the goods or services set forth in Attachment 1, which is hereby made a part of this Contract. 2. Com~nsation. The CONTRACTOR shall be compensated iri a total amount not to exceed Fifty-nine Thousand and Six Hundred and 00/100 DOLLARS 59,600.00 including approved costs incurred and taxes, according to'the Compensation and Payment Schedule set forth in Attachment 2, which is hereby made a part of this Contract. 3. Bonds. The CONTRACTOR Ois required to provide Lx]is not required to provide O a performance bond ~ a payment bond. O a performance and payment bond in the amount of N/A DOLLARS a. Standards of Conduct Declazation. The Standards of Conduct Declaration of the CONTRACTOR, is attached and is made a part of this Contract. 5. Other Terms and Conditions. The General Conditions and any Special Provisions are attached hereto and made apart of this Contract. In the event of a conflict between the General Conditions and the Special Provisions, the Special Provisions shall control. 6. Liquidated Damages. Liquidated damages shall be assessed in the amount of N/A DOLLARS ) per day, in accordance with the terms of paragraph 9 of the General Conditions. 2 AG/SPO FORM-K(2) (1!0]) 7. Notices. Any written notice required to be given by any party to this Contract shall be (a) delivered personally, or (b) sent by United States first class mail, postage prepaid. Notice required to be given to the Procurement Officer or the CONTRACTOR shall be sent to the respective address as indicated in this Contract. A notice shall be deemed to have been received three (3) days after mailing or at the time of actual receipt, whichever is eazlier. The CONTRACTOR is responsible for notifying the STATE in writing of any change of address. IN VIEW OF THE ABOVE, the parties execute this Contract by their signatures, on the dates below, to be effective as of the date first above written. STATE... - _ <~~~f (signature) Theodore E. Liu (Frio! Name) Director flf~! T2"~ 2005 (Dale( CONTRACTOR CORPORATE SEAL (If available) County of Hawaii (J rr nam) ~A.FPROVED AS TO (signoture~,, FURNt AND LEGALITY: (Print Name) ~ ~~t~~ ~ . DEPIITY CORPORATION COUNSEL (PrinjTide COUfJTY OF AWAII ~ 6 l t `I ~S Guta~ (Dare) i I 'Li Deputy Atto ey G~ e al 'Evidence of authority of the CONTRACTOR'S representative to sign this Contract for the CONTRACTOR must be attached. 3 A G/SPO FORM-K(2) Q l0] ) C CTOR'S ACKNOWLEDGMENT STATE OF Hawaii ) SS. COUNTY OF awa i i ) On this ay of , 20 before me appeazed and to me known, to be the person(s) desc bed in and, who, being by me duly sworn, did say that he/she/they is/are and of the CONTRACTOR named in the foregoing instrument, and that he/she/they is/are a thorized to sign said instrument on behalf of the CONTRACTOR, and acknowledges that h he/they executed said instrument as the free act and deed of the CONTRACTOR. (SignanmeJ (Print Name) (Notary Seal) otary Public, State of M ~ commission expires: 4 AG/SPO FOIL~1-K(2) (1/Ol) CERTIFICATE OF EXEMPTION FROM CIVIL SERVICE 1. By~Heads of Departments or Agencies as Delegated by the Director of Human Resources Development Pursuant to a delegation of the authoritybytheDirector ofHumanResourcesDevelopment, I certify that the services to be provided under this Contract, and the person(s) providing the services under this Cont~ayt are exempt from the civil service, pursuant to §76-16, Hawaii Revised Statutes JWV27~ (Signature) Date (PrintName) ~r (~o~ (Print Title) This part of the form may be used by all department heads and others to whom the Duectar of Human Resources Development (DHRD) has delegated authority to certify §76-16, HRS, civil srnice exemptions. The specific paragraph(s) of §76-16, HRS, upon which an exemption is based should be noted in the contract file. NOTE: quthority to certify exemptions under §§76-16(2), 76-16(12), and 76-16(15), HRS, has not been delegated; only the Director of DHRD may certify §§76-16(2), 76-16(12), and 76-16(15) exemptions: 2. By the Director of Human Resources Development, State of Hawaii. I certify that the services to be provided under this Contract, and the person(s) providing the services under this Contract are exempt from the civil service, pursuant to §76-16, Hawaii Revised Statutes (HRS). (Signature) Date (Print Name) (Print Title, if designee of the Director of DHRD) CONTRACTOR'S STANDARDS OF CONDUCT DECLARATION For the purposes of this declaration: "Agency" means and includes the State, the legislature and its committees, all executive departments, boards, commissions, committees, bureaus, offices, and all independent commissions and other establishments of the state government but excluding the courts. "Controlling interest" means an interest in a business or other undertaking which is sufficient in fact to control, whether the interest is greater or less than fifty per. cent (50%). "Employee" means any nominated, appointed, or elected officer or employee of the State, including members of boards, commissions, and committees, and employees under contract to the State or of the constitutional convention,-but excluding legislators, delegates to the constitutional convention, justices, and judges. (Section 84-3, HRS)_ On behalf of the County of Hawaii ,CONTRACTOR, the undersigned does declare as follows: 1. CONTRACTOR ? ism L~4 is not a legislator or an employee or a business iri which a legislator or an employee has a controlling interest. (Section 84-15(a), HRS). 2. CONTRACTOR has not been represented or assisted personally in the matter by an individual who has been an employee of the agency awazding this Contract within the preceding two years and who participated while so employed in the matter with which the Contract is directly concerned. (Section 84-15(b), HRS). 3. CONTRACTOR has not been assisted or represented by a legislator or employee for a fee or other compensation to obtain this Contract and will not be assisted or represented by a legislator or employee for a fee or other compensation in the performance of this .Contract, if the legislator or employee had been involved in the development or award of the Contract. (Section 84-14 (d), HRS). 4. CONTRACTOR has not been represented on matters related to this Contract, for a fee or other consideration by an individual who, within the past twelve (12) months, has been an agency employee, or in the case of the Legislature, a legislator, and participated while an Reminder to a2ency: If the "is" block is checked and if the Contractinvolves goods or services of a value in excess of $10,000, the Contract must be awarded by contpeti[ive sealed bidding under section 103D-302, FIRS, or a competitive sealed proposal under section 103D-303, HRS. Otherwise, the agency may not award the Contract unless itposts a notice of its intent to award it and fsles a copy of the notice with the State Ethics Commission. (Section 84]5(a), HRS). 7 Revised 1/04 employee or legislator on matters related to this Contract. (Sections 84-18(h) and (c), HRS). CONTRACTOR understands that the Contract to which this document is attached is voidable on behalf of the STATE if this Contract was entered into in violation of any provision of chapter 84, Hawaii Revised Statutes, commonly referred to as the Code of Ethics, including the provisions which are the source of the declarations above. Additionally, any fee, compensation, gift, or profit received by any person as a result of a violation of the Code of Ethics maybe recovered by the STATE. DATED: Honolulu, Hawaii, CONTRACTO~ pR~ By ~~~~~-vY+' - - (signature) Print Name i~'~d~ ~.ar; a>t: Print Title ''~~'""n`"' Name of Contractor b ty (os Date 8 ~ioo~ i Revised 1/04 STATE OF HAWAII ) SS. COUNTY OF HAWAII ) On this day of `rk~a. , 2005, before me personally appeared DIXIE KAETSU, to me personally known, who, being by me duly sworn, did say that she is the Managing Director of the County of Hawaii, a municipal corporation of the State of Hawaii; that the seal affixed to the foregoing instrument is the corporate seal of said County of Hawaii; that the foregoing instrument was signed and sealed in behalf of the County of Hawaii by authority given to said Mayor of the County of Hawaii by Section 5-1.3(g) of the County Charter, County of Hawaii (2000), as amended, and assigned by the Mayor to the Managing Director pursuant to Section 6-1.3(h) of the County Charter; and said DIXIE KAETSU acknowledged said instrument to be the free act and deed of said County of Hawaii. ~-t--a.. ~ `R-~.~.xQ JEAN IERNES Notary Public, State of Hawaii My commission expires: 11/1/2005 Attachment 1 SCOPE OF SERVICES The CONTRACTOR shall perform and provide, in a satisfactory and proper manner as determined by the STATE, the following services: I. Submit for STATE approval a Work Order for each quarter at least four (4) weeks prior to the start of each quarter. The first quarter Work Order shall be submitted within ten (10) days of the effective date of this Contract. A. Work Orders shall be in accordance with Exhibit A, "Pro-Forma for Work Orders," attached hereto and incorporated herein. Work Orders shall include, but not be limited to, planned activities, deliverables, and an estimated budget for each project. B. A notice to proceed will be issued by the STATE upon approval of each Work Order. C. Work Orders may be amended with prior written approval of the STATE. II. Upon receipt of an approved Work Order from the STATE, the CONTRACTOR shall perform the following energy outreach programs: A. Task A: Participate in Regulatory and Legislative Programs to promote the efficient use of energy, safeguard the ability to provide needed governmental services, protect the public interest, monitor electricity costs, and avoid negative impacts on ]and use planning and energy emergency planning. 1. Monitor, participate and coordinate Public Utilities Commission (PUC) and energy utility-related Integrated Resource Planning activities, including, but not limited to, PUC dockets, workshops, advisory group meetings, and Hawaii Electric Light Company Advisory Group meetings. Work with State, County, and citizen's groups to ensure that energy utility plans are consistent with State and County goals and objectives. 2. Monitor the progress of energy related bills being considered by the State legislature and submit written or oral testimony on bills, which serve to ensure safe and reliable energy and protect specific County, and State concerns. 3. Work collaboratively with the STATE, utilities, community groups, and private business interests in an effort to optimize the planning programs. B. Task B: Economic Development Projects 1. Represent the County of Hawaii and participate in the Energy Emergency Preparedness (EEP) planning and development with the STATE's Energy Planning and Policy Group. Coordinate EEP programs and participate in emergency exercises to ensure a high degree of readiness. 2. Energy Efficiency Retrofits: a. Continue verification of energy savings from retrofits by performance contracting to the Hawaii County Building, Hilo Public Safety Building and Kona Police Station. h. Monitor maintenance services provided under performance contracts to the Hawaii County Building, Hilo Public Safety Building and Kona Police Station. c. Facilitate the implementation of further energy efficiency retrofits at facilities of all County Departments including the Hawaii County Department of Water Supply. 3. Model Energy Code (MEC): Provide required services to Hawaii County Building Division in regard to compliance software, monitoring and enforcement of the MEC, including drafting legislation to amend provisions of the MEC as required. C. Task C: Technology Marketing Projects 1. Continue implementing the Action Plan for Rebuild Hawaii Island. Report on energy savings achieved through retrofits of Hawaii County facilities and provide assistance to other governmental agencies and private interests interested in implementing energy efficiency measures. 2. Attend meetings of the Rebuild Hawaii consortium, Western Region Peer Exchange and National forums of the Rebuild America program as funding permits. 3. Support the promotion of renewable energy development through the Million Solar Roofs program initiated and coordinated by groups such as, but not.limited to, the Utility Photovoltaic Group, County, private sector and local utility groups. 4. Promote the development and use of renewable energy technologies and energy efficiency by developing and issuing Requests for Proposals (RFP's) for projects funded in part by the County of Hawaii, and administering the contracts awarded. 5. Promote the use of biodiesel, cogeneration, fuel cells, micro turbines, photovoltaics, geothermal and other high-efficiency and renewable technologies in conjunction with Hawaii Electric Light Company, the Gateway Energy Center at NELHA and other organizations. 6. Administer two grants awarded to the County of Hawaii by the US DOE (via DBEDT) for investigations into commercially feasible applications of geothermal direct use in the Kapoho area of the district of Puna. 7. Coordinate with Hawaii County Building Division in regards to LEED certification of the West Hawaii civic Center to be built at Kealakehe in the district of Kona. D. Task D: Program Planning and Administration. Duties shall include, but not be limited to: 1. Developing and revising budgets, reports, grants, and other written and visual preparations; 2. Providing administrative functions required in daily operations [hat are not directly related to the specific projects listed above, including but not limited to, preparation of legislative testimony, review of planning documents, reports and environmental impact statements; 3. Interfacing with federal, state and county agencies, businesses, and the general public; 4. Participating in any professional development and skill enhancement training related to the optimum function of the Energy Coordinator; and 5. Other energy-related tasks as approved by the STATE. III. Reporting requirements: Submit for STATE approval the following reports: A. Quarterly reports (original and two copies): Quarterly program reports shall be submitted no later than five (5) working days after the ending of each quarter. Quarterly program reports shall include, but not be limited to, a summary of the CONTRACTOR'S activities in meeting the goals and deliverables of the approved Work Order, the requirements of this Contract, and any recommendations or concerns regarding the projects. 1. Any deliverables not accomplished during a designated quarter should include an explanation and a brief plan for the next quarter. 2. Quarterly reports shall include reports on meetings, workshops, and conferences attended; who scheduled the meeting, workshop; the purpose; who attended and what was discussed or what actions were taken; conclusions reached, if any; and the CONTRACTOR'S evaluation and recommendations. B. A certified fiscal report shall summarize quarterly charges for deliverables in accordance with the format specified in the attached Exhibit B, "Quarterly Fiscal Report," incorporated herein, and submitted with quarterly invoices as specified in the attached Exhibit C, "Quarterly Invoice," incorporated herein. C. Final reports: A Final Report shall be submitted no later than fifteen (IS) calendar days prior to the termination date of this Contract (original and five copies). The Final Report shall include, but not be limited to, a summary of the CONTRACTOR'S overall efforts in meeting the requirements of this Contract and an evaluation of all projects and recommendations for follow-up and future activities. A certified final fiscal report, which shall also be the fiscal report for the fourth quarter, shall summarize all charges for deliverables during the period of the contract in accordance with the format specified in the attached Exhibit B, "Quarterly Fiscal Report," incorporated herein. D. All reports shall be submitted to Mr. Maurice H. Kaya, Chief Technology Officer, Strategic Industries Division, Department of Business, Economic Development, and Tourism, P.O. Box 2354, Honolulu, Hawaii 96804-2359. Attachment 2 TIME OF PERFORMANCE Performance of services by the CONTRACTOR shall commence on the effective date of this Contract, and all of the services required under this Contract shall be completed by June 30, 2006, unless this Contract is sooner terminated or extended as hereinafter provided. This contract will not be extended. Attachment 3 COMPENSATION AND PAYMENT SCHEDULE The compensation for the services to be performed by the CONTRACTOR under this Contract shall be the sum of money not to exceed FIFTY NINE THOUSAND SIX HUNDRED AND NO/100 DOLLARS ($59,600.00), which sum shall be paid in accordance with the following: A. Payment shall be made by the STATE to the CONTRACTOR upon receipt of invoices, in accordance with the attached Exhibit C, "Quarterly Invoice," and subject to the other provisions of this section. B. Payments shall be made in accordance with the preapproved quarterly Work Order budget. 1. Payment by Deliverables: Payment shall be made only after the STATE has determined that the work has been satisfactorily performed and that the CONTRACTOR is entitled to receive payment under the terms of this Contract. Deliverables are due on or before the end of the quarter, as stated in the Work Order, unless otherwise approved by the STATE. 2. Cost Reimbursable Basis: Costs will be paid on a cost reimbursable basis to comply with Appendix A, General Provisions, of the U.S. Department of Energy's "Gran[ Provisions for State and Local Governments," paragraph l.b., which states: "This grant is funded on an allowable cost basis without fee or profit to the grantee organization, not to exceed the amount awarded as indicated on the face page and is subject to a refund of unexpended funds to DOE." C. If an amount for a reported deliverable is determined by the STATE to be inappropriate and unallowable, the STATE may deduct an equivalent amount from the current or next payable invoice and may withhold payment of the amount of monies equivalent to the questioned deliverable until later resolution of the discrepancy by audit or other means. D. Final payment shall be made upon the receipt and approval of a final program and fiscal report and of all other deliverables and other materials to be submitted by the CONTRACTOR to the STATE, resolution of all discrepancies in performance of services, and completion of all other outstanding matters under this Contract. E. The CONTRACTOR shall comply with all applicable federal laws and rules, including U.S. Office of Management and Budget Circular A-87 and A-133; the State Energy Program Regulations; and the U.S. Department of Energy Financial Assistance Rules, 10 CFR Chapter II, Part 600, which are available for inspection in the office of the State of Hawaii Department of Business, Economic Development, and Tourism's Strategic Industries Division, 235 South Beretania Street, Room 506, Honolulu, Hawaii. F. Funds budgeted for individual projects are estimates and are listed in Work Orders. Funds within a project group may be shifted from one project to another within the group upon notification to the STATE. No more than five percent (5%) of budgeted funds in any project group can be shifted to another project group within a Work Order without authorization from the STATE. G. The entire amount of the CONTRACTOR'S compensation as described herein is payable ou[ of federal funds and this contract shall be construed strictly to be a contract to pay said compensation to the CONTRACTOR only out of federal funds when such are so received. This contract shall not be construed as a contract to pay [he CONTRACTOR'S compensation out of any other funds than federal funds, when received from the federal government, under any other circumstances. EXH/B/T A PRO-FORMA FOR WORK ORDERS State Energy Program -Neighbor Island Energy Assistance Program Date: County of Contract No. Contract Period.• Contract Amount: (Total amount for the Agreement) Work Order No. Period of Performance: (Quarter) Date Approved: Budget Amount for Work Order: I. (First Project Title) A. Expected Outcomes 1. Project Goal 2. Project Objectives to Accomplish the Goal B. Planned Activities -Work Plan (Tasks to be performed to achieve Project Objectives, including methodologies) II. (Second Project Title), etc. III. Budget and Deliverables Deliverables are due on or before the end of the quarter listed above, unless otherwise approved by the STATE. Deliverable County Funds State Funds Budget Amount Project Deliverable Deliverable Project Deliverable Total for the Quarter Costs shall not exceed estimated amounts without prior approval of the STATE. Costs will be paid on acost-reimbursable basis. (A Notice to Proceed will be issued after Work Order is approved by the STATE) EXHIBIT B QUARTERLY FISCAL REPORT State Energy Program - Neigll6or Island Energy Assistance Program Reporting Period: (From) (To) County of Contract Number: Contract Period: Contract Amount: (Total amount for the Agreement) I. Fiscal Report for Reporting Period (a) (b) (c) (d) Invoice Variance Budget in County Amount Amount Percentage Work Order Funds (State Funds) a - + c d _ a Work Order ~ (xxx) (xxx) (xxx) (xxx) (xxx) II. Source of County Funds III. Balance of Funds in Contract Total Contract Cumulative to Balance Amount the uarter Amount Percentage (xxx) (xxx) (xxx) (xx.xx%) CERTIFICATION: I certify to the best of my knowledge and belief that this report is correct and complete and that all charges are for the purpose and conditions of the Agreement. Signature Date Type Name and Title Telephone Number EXHIBIT C QUARTERLY INVOICE State Energy Program -Neighbor Island Energy Assistance Program INVOICE # DATE Reporting Period: (From) (To) County of TO: Mr. Maurice H. Kaya Chief Technology Officer and Energy Program Administrator DBEDT-SID P.O. Box 2359 Honolulu, HI 96804-2359 CONTRACT NUMBER: CONTRACT PERIOD: CONTRACT AMOUNT: (Total amount for the Agreement) AMOUNT REQUESTED: Amount County State Actual from Funds Funds Amount Charges by Work Order H _ Work Order Expended Expended Expended Project Deliverable (xxx) (xxx) (xxz) (xxx) Deliverable (xxx) (xzz) (xxz) (xxx) Project Deliverable (xxx) (xxx) (xxz) (xxx) Total: CERTIFICATION: I certify to the best of my knowledge and belief that this invoice is correct and complete and that al] charges are for the purpose and conditions of the Agreement. Signature Date Type Name and Title Telephone Number Please submit original and three copies together with detail for cost reimbursements. Attachment 4 SPECIAL CONDITIONS 1. Deletion of Portions of Contract. For purposes of this Contract, paragraph 4 on page 2 of the Contract, "Standards of Conduct Declaration," together with the attached Standards of Conduct Declaration form are hereby deleted and the parties agree that paragraph 4 of the Contract and its attached form are not operative. 2. Modification of General Conditions. For purposes of this Contract, subparagraph 20.6. on page 12 of the General Conditions is modified to read as follows: " 20.b. Time eriod for claim. Within ten (10) days after receipt of a written change order under subparagraph 20a, unless the period is extended by the Agency procurement officer in writing, the CONTRACTOR shall file notice of intent to assert a claim for an adjustment. Later notification of intent shall not bar the CONTRACTOR'S claim unless the STATE is prejudiced by the delay in notification." 3. Deletion of General Conditions. For purposes of this Contract, the following General Conditions are hereby deleted from the General Conditions and have no operative effect between the parties: a. Subparagraphs 2.e.; b. Subparagraph 17.d.; a Subparagraphs 19.h.; d. Subparagraphs 19.g.; and e. Subparagraph 20.c. Form AG 2-County Special Conditions (5/OS) GENERAL CONDITIONS Table of Contents Pa e s 1. Coordination of Services by the STATE 1 2. Relationship of Parties: Independent Contractor Status and Responsibilities, Including Tax Responsibilities 1 3. Personnel Requirements 2 4. Nondiscrimination .....................................................................................2 5. Conflicts of Interest ....................................................................................2 6. Subcontracts and Assignments .......................................................................2 7. Indemnification and Defense 3 8. Cost of Litigation ......................................................................................3 9. Liquidated Damages 3 10. State's Right of Offset 4 11. Disputes ..................................................................................................4 12. Suspension of Contract ................................................................................4 13. Termination for Default 5 14. Termination for Convenience 7 15. Claims Based on the Agency Procurement Officer's Actions or Omtssrons 8 16. Costs and Expenses 9 17. Payment Procedures Final Payment; Tax Clearance 10 18. Federal Funds ...........................................................................................10 19. Modifications of Contract ............................................................................10 20. Change Order ...........................................................................................11 21. Price Adlustment .......................................................................................12 i Form AG2-GCp2/04) 22. Variation in Quantity for Definite Quantity Contracts 13 23. Changes in Cost-Reimbursement Contract 13 24. Confidentiality of Material 14 25. Publici .................................................................................................14 26. Ownership Rights and Copyright ....................................................................14 27. Liens and Warranties ..................................................................................14 28. Audit of Books and Records of the CONTRACTOR 14 29. Cost or Pricing Data 15 30. Audit of Cost or Pricing Data ........................................................................15 31. Records Retention ......................................................................................15 32. Antitrust Claims 15 33. Patented Articles 15 34. Governing Law 15 35. Compliance with Laws ................................................................................16 36. Conflict between General Conditions and Procurement Rules ...............................16 37. Entire Contract 16 38. Severability ..............................................................................................16 39. Waiver 16 40. Pollution Control 16 i 1 Form AG2-GC(d2(04) GENERAL CONDITIONS 1. Coordination of Services by the STATE. The "head of the purchasing agency," (which term includes the designee of the head of the purchasing agency), shall coordinate the services to be provided by the CONTRACTOR in order to complete the performance required in the Contract. The CONTRACTOR shall maintain communications with the head of the purchasing agency at all stages of the CONTRACTOR'S work, and submit to the head of the purchasing agency for resolution any questions which may arise as to the performance of this Contract. "Purchasing agency" as used in these General Conditions means and includes any governmental body which is authorized under chapter 103D, HRS, or its implementing rules and procedures, or by way of delegation, to enter into contracts for the procurement of services. 2. Relationship of Parties: Independent Contractor Status and Responsibilities, Including Tax Responsibilities. a. In the performance of services required under this Contract, the CONTRACTOR is an "independent contractor," with the authority and responsibility to control and duect the performance and details of the work and services required under this Contract; however, the STATE shall have a general right to inspect work in progress to determine whether, in the STATE'S opinion, the services aze being performed by the CONTRACTOR in compliance with this Contract. Unless otherwise provided by special condition, it is understood that the STATE does not agree to use the CONTRACTOR exclusively, and that the CONTRACTOR is free to contract to provide services to other individuals or entities while under contract with the STATE. b. The CONTRACTOR and the CONTRACTOR'S employees and agents aze not by reason of this Contract, agents or employees of the State for any purpose, and the CONTRACTOR and the CONTRACTOR'S employees and agents shall not be entitled to claim or receive from the State any vacation, sick leave, retirement, workers' compensation, unemployment insurance, or other benefits provided to state employees. c. The CONTRACTOR shall be responsible for the accuracy, completeness, and adequacy of the CONTRACTOR'S performance under this Contract. Furthermore, the CONTRACTOR intentionally, voluntarily, and knowingly assumes the sole and entire liability to the CONTRACTOR'S employees and agents, and to any individual not a party to this Contract, for all loss, damage, or injury caused by the CONTRACTOR, or the CONTRACTOR'S employees or agents m the course of their employment. d. The CONTRACTOR shall be responsible for payment of all applicable federal, state, and county taxes and fees which may become due and owing by the CONTRACTOR by reason of this Contract, including but not limited to (i) income taxes, (ii) employment related fees, assessments, and taxes, and (iii) general excise taxes. The CONTRACTOR also is responsible for obtaining all licenses, permits, and certificates that may be required in order to perform this Contract. e. The CONTRACTOR shall obtain a general excise tax license from the Depamnent of Taxation, State of Hawaii, in accordance with section 237-9, HRS, and shall 1 Form AG2-GC(12/04) comply with all requirements thereof. The CONTRACTOR shall obtain a tax clearance certificate from the Duector of Taxation, State of Hawaii, showing that all delinquent taxes, if any, levied or accrued under state law against the CONTRACTOR have been paid and submit the same to the STATE prior to commencing any performance under this Contract. The CONTRACTOR shall also be solely responsible for meeting all requirements necessary to obtain the tax clearance certificate required for final payment under sections 103-53 and 237-45, HRS, and pazagraph 17 of these General Conditions. f. The CONTRACTOR is responsible for securing all employee-related insurance coverage for the CONTRACTOR and the CONTRACTOR'S employees and agents that is or may be required by law, and for payment of all premiutns, costs, and other liabilities associated with securing the insurance coverage. 3. Personnel Requirements. a. The CONTRACTOR shall secure, at the CONTRACTOR'S own expense, all personnel required to perform this Contract. b. The CONTRACTOR shall ensure that the CONTRACTOR'S employees or agents are experienced and fully qualified to engage in the activities and perform [he services required under this Contract, and that all applicable licensing and operating requirements imposed or required under federal, state, or county law, and all applicable accreditation and other standards of quality generally accepted in the field of the activities of such employees and agents are complied with and satisfied. 4. Nondiscrimination. No person performing work under this Contract, including any subcontractor, employee, or agent of the CONTRACTOR, shall engage in any discrimination that is prohibited by any applicable federal, state, or county law. 5. Conflicts of Interest. The CONTRACTOR represents that neither the CONTRACTOR, nor any employee or agent of the CONTRACTOR, presently has any interest, and promises that no such interest, duect or indirect, shall be acquired, that would or might conflict in any manner or degree with the CONTRACTOR'S performance under this Contract. 6. Subcontracts and Assignments. The CONTRACTOR shall not assign or subcontract any of the CONTRACTOR'S duties, obligations, or interests under this Contract and no such assignment or subcontract shall be effective unless (i) the CONTRACTOR obtains the prior written consent of the STATE and (ii) the CONTRACTOR'S assignee or subcontractor submits to the STATE a tax clearance certificate from the Director of Taxation, State of Hawaii, showing that all delinquent taxes, if any, levied or accrued under state law against the CONTRACTOR'S assignee or subcontractor have been paid. Additionally, no assignment by the CONTRACTOR of the CONTRACTOR'S right to compensation under this Contract shall be effective unless and until the assignment is approved by the Comptroller of the State of Hawaii, as provided in section 40-58, HRS. 2 Form AG2-GC(12/64) a. Recognition of a successor in interest. When in the best interest of the State, a successor in interest may be recognized in an assignment Contract in which the STATE, the CONTRACTOR and the assignee or transferee (hereinafter referred to as the "Assignee") agree that: (1) The Assignee assumes all of the CONTRACTOR'S obligations; (2) The CONTRACTOR remains liable for all obligations under this Contract but waives all rights under this Contract as against the STATE; and (3) The CONTRACTOR shall continue to furnish, and the Assignee shall also furnish, all required bonds. b. Change of name. When the CONTRACTOR asks to change the-name in which it holds this Contract with the STATE, the procurement officer of the purchasing agency (hereinafter referred to as the "Agency procurement officer") shall, upon receipt of a document acceptable or satisfactory to the Agency procurement officer indicating such change of name (for example, an amendment to the CONTRACTOR'S articles of incorporation), enter into an amendment to this Contract with the CONTRACTOR to effect such a change of name. The amendment to this Contract changing the CONTRACTOR'S name shall specifically indicate that no other terms and conditions of this Contract are thereby changed. c. Reports' All assignment Contracts and amendments to this Contract effecting changes of the CONTRACTOR'S name or novations hereunder shall be reported to the CPO within thirty days of the date that the assignment Contract or amendment becomes effective. d. Actions affecting more than one purchasing agency. Notwithstanding the provisions of subparagraphs 6a through 6c herein, when the CONTRACTOR holds Contracts with more than one purchasing agency of the State, the assignment Contracts and the novation and change of name amendments herein authorized shall be processed only through the CPO's office. 7. Indemnification and Defense. The CONTRACTOR shall defend, indemnify, and hold harmless the State of Hawaii, the contracting agency, and their officers, employees, and agents from and against all liability, loss, damage, cost, and expense, including all attorneys' fees, and all claims, suits, and demands therefor, azising out of or resulting from the acts or omissions of the CONTRACTOR or the CONTRACTOR'S employees, officers, agents, or subcontractors under this Contract. The provisions of this pazagraph shall remain in full force and effect notwithstanding the expiration or early termination of this Contract. 8. Cost of Litigation. In case the STATE shall, without any fault on its part, be made a party to any litigation commenced by or against the CONTRACTOR in connection with this Contract, the CONTRACTOR shall pay all costs and expenses incurred by or imposed on the STATE, including attorneys' fees. 9. Liquidated Damages. When the CONTRACTOR is given notice of delay or nonperformance as specified in paragraph 13 (Termination for Default) and fails to cure in the time specified, it is agreed the CONTRACTOR shall pay to the STATE the amount, if 3 Form AG2-GC(12/o4) any, set forth in this Contract per calendar day from the date set for cure until either (i) the STATE reasonably obtains siitiilar goods or services, or both, if the CONTRACTOR is terminated for default, or (ii) until the CONTRACTOR provides the goods or services, or both, if the CONTRACTOR is not terminated for default. To the extent that the CONTRACTOR's delay or nonperformance is excused under paragraph 13d (Excuse for Nonperformance or Delay Performance), liquidated damages shall not be assessable against the CONTRACTOR. 10. State's Right of Offset. The STATE may offset against any monies or other obligations the STATE owes to the CONTRACTOR under this Contract, any amounts owed to the State of Hawaii by the CONTRACTOR under this Contract or any other Contracts or pursuant to any law or other obligation owed to the State of Hawaii by the CONTRACTOR, including, without limitation, the payment of any taxes or levies of any kind or nature. The STATE will notify the CONTRACTOR in writing of any offset and the nature of such offset. For purposes of this paragraph, amounts owed to the State of Hawaii shall not include debts or obligations which have been liquidated, agreed to by the CONTRACTOR, and are covered by an installment payment or other settlement plan approved by the State of Hawaii, provided, however, that the CONTRACTOR shall be entitled to such exclusion only to the extent that the CONTRACTOR is current with, and not delinquent on, any payments or obligations owed to the State of Hawaii under such payment or other settlement plan. 11. Disputes. Disputes shall be resolved in accordance with section 103D-703, HRS, and chapter 126, Procurement Rules, as the same may be amended from time to time. 12. Suspension of Contract. The STATE reserves the right at any time and for any reason to suspend this Contract for any reasonable period, upon written notice to the CONTRACTOR in accordance with the provisions herein. a. Order to stop performance. The Agency procurement officer, may, by written order to the CONTRACTOR, at any time, and without notice to any surety, requve the CONTRACTOR to stop all or any part of the performance called for by this Contract. This order shall be for a specified period not exceeding sixty (60) days after the order is delivered to the CONTRACTOR, unless the parties agree to any further period. Any such order shall be identified specifically as a stop performance order issued pursuant to this section. Stop performance orders shall not exceed sixty consecutive days and shall include, as appropriate: (1) A clear description of the work to be suspended; (2) Instructions as to the issuance of further orders by the CONTRACTOR for material or services; (3) Guidance as to action to be taken on subcontracts; and (4) Other instructions and suggestions to the CONTRACTOR for minimizing costs. Upon receipt of such an order, the CONTRACTOR shall forthwith comply with its terms and suspend all performance under this Contract at the time stated, provided, however, the CONTRACTOR shall take all reasonable steps to minimize the occurrence of costs allocable to the performance covered by the order during the period of performance stoppage. Before the stop performance order expires, or within any further period to which the parties shall have agreed, the Agency procurement officer shall either: (1) Cancel the stop performance order; or 4 Form AG2-GC(12/04) (2) Terminate the performance covered by such order as provided in the termination for default provision or the termination for convenience provision of this Contract. b. Cancellation or expiration of the order. If a stop performance order issued under this section is cancelled at any time during the period specified in the order, or if the period of the order or any extension thereof expires, the CONTRACTOR shall have the right to resume performance. An appropriate adjustment shall be made in the delivery schedule or Contract price, or both, and the Contract shall be modified in writing accordingly, if: (1) The stop performance order results in an increase in the time required for, or in the CONTRACTOR's cost properly allocable to, the performance of any part of this Contract; and (2) The CONTRACTOR asserts a claim for such an adjustment within thirty (30) days after the end of the period of performance stoppage; provided that, if the Agency procurement officer decides that the facts justify such action, any such claim asserted may be received and acted upon at any time prior to fmal payment under this Contract. c. Termination of stopped performance. If a stop performance order is not cancelled and the performance covered by such order is terminated for default or convenience, the reasonable costs resulting from the stop performance order shall be allowable by adjustment or otherwise. d. Adjustment of price. Any adjustment in contract price made pursuant to this paragraph shall be determined in accordance with the price adjustment provision of this Contract. 13. Termination for Default. a. Default. If the CONTRACTOR refuses or fails to perform any of the provisions of this Contract with such diligence as will ensure its completion within the time specified in this Contract, or any extension thereof, otherwise fails to timely satisfy the Contract provisions, or commits any other substantial breach of this Contract, the Agency procurement officer may notify the CONTRACTOR in writing of the delay or non-performance and if not cured in ten (10) days or any longer time specified in writing by the Agency procurement officer, such officer may terminate the CONTRACTOR'S right to proceed with the Contract or such part of the Contract as to which there has been delay or a failure to properly perform. In the event of termination in whole or in part the Agency procurement officer may procure similar goods or services in a manner and upon the terms deemed appropriate by the Agency procurement officer. The CONTRACTOR shall continue performance of the Contract to the extent it is not terminated and shall be liable for excess costs incurred in procuring similar goods or services. b. CONTRACTOR'S duties. Notwithstanding termination of the Contract and subject to any directions from the Agency procurement officer, the CONTRACTOR shall take timely, reasonable, and necessary action to protect and preserve property in the possession of the CONTRACTOR in which the STATE has an interest. 5 Form AG2-GC(12/04) c. Compensation. Payment for completed goods and services delivered and accepted by the STATE shall be at the price set forth in the Contract. Payment for the protection and preservation of property shall be in an amount agreed upon by the CONTRACTOR and the Agency procurement officer. If the parties fail to agree, the Agency procurement officer shall set an amount subject to the CONTRACTOR's rights under chapter 126, Procurement Rules. The STATE may withhold from amounts due the CONTRACTOR such sums as the Agency procurement officer deems to be necessary to protect the STATE against loss because of outstanding liens or claims and to reimburse the STATE for the excess costs expected to be incurred by the STATE in procuring similar goods and services. d. Excuse for nonperformance or delayed performance. The CONTRACTOR shall not be in default by reason of any failure in performance of this Contract in accordance with its terms, including any failure by the CONTRACTOR to make progress in the prosecution of the performance hereunder which endangers such performance, if the CONTRACTOR has notified the Agency procurement officer within fifreen (15) days after the cause of the delay and the failure arises out of causes such as: acts of God; acts of a public enemy; acts of the State and any other governmental body in its sovereign or contractual capacity; fires; floods; epidemics; quarantine restrictions; strikes or other labor disputes; freight embargoes; or unusually severe weather. If the failure to perform is caused by the failure of a subcontractor to perform or to make progress, and if such failure arises out of causes similar to those set forth above, the CONTRACTOR shall not be deemed to be in default, unless the goods and services to be famished by the subcontractor were reasonably obtainable from other sources in sufficient time to permit the CONTRACTOR to meet the requirements of the Contract. Upon request of the CONTRACTOR, the Agency procurement officer shall ascertain the facts and extent of such failure, and, if such officer determines that any failure to perform was occasioned by any one or more of the excusable causes, and that, but for the excusable cause, the CONTRACTOR'S progress and performance would have met the terms of the Contract, the delivery schedule shall be revised accordingly, subject to the rights of the STATE under this Contract. As used in this paragraph, the term "subcontractor" means subcontractor at any tier. e. Erroneous termination for default. If, after notice of termination of the CONTRACTOR'S right to proceed under this paragraph, it is determined for any reason that the CONTRACTOR was not in default under this pazagraph, or that the delay was excusable under the provisions of subpazagraph 13d, "Excuse for nonperformance or delayed performance," the rights and obligations of the pazties shall be the same as if the notice of ternnation had been issued pursuant to paragraph 14. f. Additional rights and remedies. The rights and remedies provided in this pazagraph are in addition to any other rights and remedies provided by law or under this Contract. 14. Termination for Convenience. a. Termination. The Agency procurement officer may, when the interests of the STATE so require, terminate this Contract in whole or in part, for the convenience of the STATE. The Agency procurement officer shall give written notice of the 6 Form AG2-GC(]2104) termination to the CONTRACTOR specifying the part of the Contract terminated and when termination becomes effective. b. CONTRACTOR'S obligations. The CONTRACTOR shall incur no further obligations in connection with the terminated performance and on the date(s) set in the notice of termination the CONTRACTOR will stop performance to the extent specified. The CONTRACTOR shall also terminate outstanding orders and subcontracts as they relate to the terminated performance. The CONTRACTOR shall settle the liabilities and claims azising out of the termination of subcontracts and orders connected with the terminated performance. The Agency procurement officer may direct the CONTRACTOR to assign the CONTRACTOR'S right, title, and interest under terminated orders or subcontracts to the STATE. The CONTRACTOR must still complete the performance not terminated by the notice of termination and may incur obligations as necessary to do so. c. Right to goods and work product. The Agency procurement officer may require the CONTRACTOR to transfer title and deliver to the STATE in the manner and to the extent directed by the Agency procurement officer: (1) Any completed goods or work product; and (2) The partially completed goods and materials, parts, tools, dies, jigs, fixtures, plans, drawings, information, and contract rights (hereinafter called "manufacturing material") as the CONTRACTOR has specifically produced or specially acquired for the performance of the terminated part of this Contract. The CONTRACTOR shall, upon direction of the Agency procurement officer, protect and preserve property in the possession of the CONTRACTOR in which the STATE has an interest. If the Agency procurement officer does not exercise this right, the CONTRACTOR shall use best efforts to sell such goods and manufacturing materials. Use of this paragraph in no way implies that the STATE has breached the Contract by exercise of the termination for convenience provision. d. Compensation. (1) The CONTRACTOR shall submit a termination claim specifying the amounts due because of the termination for convenience together with the cost or pricing data, submitted to the extent required by subchapter 15, chapter 3-122, Procurement Rules, beazing on such claim. If the CONTRACTOR fails to file a termination claim within one year from the effective date of termination, the Agency procurement officer may pay the CONTRACTOR, if at all, an amount set in accordance with subparagraph 14d(3) below. (2) The Agency procurement officer and the CONTRACTOR may agree to a settlement provided the CONTRACTOR has filed a termination claim supported by cost or pricing data submitted as required and that the settlement does not exceed the total Contract price plus settlement costs reduced by payments previously made by the STATE, the proceeds of any sales of goods and manufacturing materials under subparagraph 14c, and the Contract price of the performance not terminated. ~ Form AG2-GC(12/04) (3) Absent complete agreement under subparagraph 14d(2) the Agency procurement officer shall pay the CONTRACTOR the following amounts, provided payments agreed to under subparagraph 14d(2) shall not duplicate payments under this subpazagraph for the following: (A) Contract prices for goods or services accepted under the Contract; (B) Costs incurred in preparing to perform and performing the terminated portion of the performance plus a fair and reasonable profit on such portion of the performance, such profit shall not include anticipatory profit or consequential damages, less amounts paid or to be paid for accepted goods or services; provided, however, that if it apgeazs that the CONTRACTOR would have sustained a loss if the entire Contract would have been completed, no profit shall be allowed or included and the amount of compensation shall be reduced to reflect the anticipated rate of loss; (C) Costs of settling and paying claims arising out of the termination of subcontracts or orders pursuant to subpazagraph 14b. These costs must not include costs paid in accordance with subparagraph 14d(3)(B); (D) The reasonable settlement costs of the CONTRACTOR including accounting, legal, clerical, and other expenses reasonably necessary for the preparation of settlement claims and supporting data with respect to the terminated portion of the Contract and for the termination of subcontracts thereunder, together with reasonable storage, transportation, and other costs incurred in connection with the protection or disposition of property allocable to the terminated portion of this Contract. The total sum to be paid the CONTRACTOR under this subparagraph shall not exceed the total Contract price plus the reasonable settlement costs of the CONTRACTOR reduced by the amount of payments otherwise made, the proceeds of any sales of supplies and manufacturing materials under subpazagraph 14d(2), and the Contract price of performance not terminated. (4) Costs claimed, agreed to, or established under subparagraphs 14d(2) and 14d(3) shall be in accordance with Chapter 3-123 (Cost Principles) of the Procurement Rules. 15. Claims Based on the Agency Procurement Officer's Actions or Omissions. a. Changes in scope. If any action or omission on the part of the Agency procurement officer (which term includes the designee of such officer for purposes of this paragraph 15) requiring performance changes within the scope of the Contract constitutes the basis for a claim by ffie CONTRACTOR for additional compensation, damages, or an extension of time for completion, the CONTRACTOR shall continue with performance of the Contract in compliance with the directions or orders of such officials, but by so doing, the CONTRACTOR a Form AG2-GC(12/04) shall not be deemed to have prejudiced any claim for additional compensation, damages, or an extension of time for completton; provided: (1) Written notice required. The CONTRACTOR shal} give written notice to the Agency procurement officer: (A) Prior to the commencement of the performance involved, if at that time the CONTRACTOR knows of the occurrence of such action or omission; (B) Within thirty (30) days after the CONTRACTOR knows of the occurrence of such action or omission, if the CONTRACTOR did not have such knowledge prior to the commencement of the performance; or (C) Within such further time as may be allowed by the Agency procurement officer in writing. (2) Notice content. This notice shall state that the CONTRACTOR regards the act or omission as a reason which may entitle the CONTRACTOR to additional compensation, damages, or an extension of time. The Agency procurement officer, upon receipt of such notice, may rescind such action, remedy such omission, or take such other steps as may be deemed advisable in the discretion of the Agency procurement officer; (3) Basis must be explained. The notice required by subpazagraph 15a(1) describes as cleazly as practicable at the time the reasons why the CONTRACTOR believes that additional compensation, damages, or an extension of time may be remedies to which the CONTRACTOR is entitled; and (4) Claim must be justified. The CONTRACTOR must maintain and, upon request, make available to the Agency procurement officer within a reasonable time, detailed records to the extent practicable, and other documentation and evidence satisfactory to the STATE, justifying the claimed additional costs or an extension of time in connection with such changes. b. CONTRACTOR not excused. Nothing herein contained, however, shall excuse the CONTRACTOR from compliance with any rules or laws precluding any state officers and CONTRACTOR from acting in collusion or bad faith in issuing or performing change orders which are clearly not within the scope of the Contract. c. Price adjustment. Any adjustment in the price made pursuant to this pazagraph shall be determined in accordance with the price adjustment provision of this Contract. 16. Costs and Expenses. Any reimbursement due the CONTRACTOR for per diem and transportation expenses under this Contract shall be subject to chapter 3-123 (Cost Principles) of the Procurement Rules and the following guidelines: 9 Form AG2-GC(12/04) a. Reimbursement for air transportation shall be for actual cost or coach class air fare, whichever is less. b. Reimbursement for ground transportation costs shall not exceed the actual cost of renting an intermediate-sized vehicle. c. Unless prior written approval of the DIRECTOR is obtained, reimbursement for subsistence allowance (i.e., hotel and meals, etc.) shall not exceed the applicable daily authorized rates for inter-island or out-of--state travel that aze set forth in the current Governor's Executive Order authorizing adjustments in salazies and benefits for state officers and employees in the executive branch who aze excluded from collective bargaining coverage. 17. Payment Procedures; Final Payment; Tax Clearance. a. Ori{~inal invoices required. All payments under this Contract shall be made only upon submission by the CONTRACTOR of original invoices specifying the amount due and certifying that services requested under the Contract have been performed by the CONTRACTOR according to the Contract. b. Subject to available funds. Such payments are subject to availability of funds and allotment by the Du•ector of Finance in accordance with chapter 37, HRS. Further, all payments shall be made in accordance with and subject to chapter 40, HRS. c. Prompt payment. (1) Any money, other than retainage, paid to the CONTRACTOR shall be dispersed to subcontractors within ten days after receipt of the money in accordance with the terms of the subcontract; provided that the subcontractor has met all the terms and conditions of the subcontract and there are no bona fide disputes; and (2) Upon final payment to the CONTRACTOR, full payment to the subcontractor, including retainage, shall be made within ten days after receipt of the money; provided that there aze no bona fide disputes over the subcontractor's performance under the subcontract. d. Final payment. Final payment under this Contract shall be subject to sections 103-53 and 237-45, HRS, which require a tax clearance from the Director of Taxation, State of Hawaii, showing that all delinquent taxes, if any, levied or accrued under state law against the CONTRACTOR have been paid. 18. Federal Funds. If this Contract is payable in whole or in part from federal funds, CONTRACTOR agrees that, as to the portion of the compensation under this Contract to be payable from federal funds, the CONTRACTOR shalt be paid only from such funds received from the federal government, and shall not be paid from any other funds. 19. Modifications of Contract. a. In writing. Any modification, alteration, amendment, change, or extension of any term, provision, or condition of this Contract permitted by this Contract shall be 10 Form AG2-GC(12I04) made by written amendment to this Contract, signed by the CONTRACTOR and the STATE, provided that change orders shall be made in accordance with paragraph 20 herein. b. No oral modification. No oral modification, alteration, amendment, change, or extension of any term, provision or condition of this Contract shall be permitted. c. Agency procurement officer. By written order, at any time, and without notice to any surety, the Agency procurement officer may, unilaterally, order of [he CONTRACTOR: (A) Changes in the work within the scope of the Contract; and (B) Changes in the time of performance of the Contract that do not alter the scope of the Contract work. d. Adjustments of price or time for performance. If any modification increases or decreases the CONTRACTOR'S cost of, or the tithe required for, performance of any part of the work under this Contract, an adjustment shall be made and this Contract modified in writing accordingly. Any adjustment in Contract price made pursuant to this clause shall be determined, where applicable, in accordance with the price adjustment clause of this Contract or as negotiated. e. Claim bazred after final payment. No claim by the CONTRACTOR for an adjustment hereunder shall be allowed if written Contract of modification is not made prior to final payment under this Contract. f. Claims not barred. In the absence of a Contract modification, nothing in this clause shall be eemed to restrict the CONTRACTOR'S right to pursue a claim under this Contract or for a breach of contract. g. CPO approval. If this is a professional services Contract awarded pursuant to section 103D-303 or 103D-304, HRS, any modification, alteration, amendment, change, or extension of any term, provision, or condition of this Contract which increases the amount payable to the CONTRACTOR by at least $25,000.00 or ten per cent (10%) of the initial Contract price, whichever increase is higher, must receive the prior approval of the CPO. h. Tax clearance. The STATE may, at its discretion, require the CONTRACTOR to submit to the STATE, prior to the STATE'S approval of any modification, alteration, amendment, change, or extension of any term, provision, or condition of this Contract, a tax clearance from the Director of Taxation, State of Hawaii, showing that all delinquent taxes, if any, levied or accrued under state law against the CONTRACTOR have been paid. i. Sole source Contracts. Amendments to sole source Contracts that would change the original scope of the contract may only be made with the approval of the CPO. Annual renewal of a sole source Contract for services should not be submitted as an amendment. 20. Change Order. The Agency procurement officer may, by a written order signed only by the STATE, at any time, and without notice to any surety, and subject to all appropriate 11 Porm AG2-GCQ2/04) adjustments, make changes within the general scope of this Contract in any one or more of the following: (1) Drawings, designs, or specifications, if the goods or services to be furnished are to be specially provided to the STATE in accordance therewith; (2) Method of delivery; or (3) Place of delivery. a. Adjustments of price or time for performance. If any change order increases or decreases the CONTRACTOR's cost of, or the time required for, performance of any part of the work under this Contract, whether or not changed by the order, an adjustment shall be made and the Contract modified in writing accordingly. Any adjustment in the Contract price made pursuant to this provision shall be determined in accordance with the price adjustment provision of this Contract. Failure of the parties to agree to an adjustment shall not excuse the CONTRACTOR from proceeding with the Contract as changed, provided that the Agency procurement officer promptly and duly makes the provisional adjustments in payment or time for performance as may be reasonable. By proceeding with the work, the CONTRACTOR shall not be deemed to have prejudiced any claim for additional compensation, or any extension of time for completion. b. Time period for claim. Within ten (10) days after receipt of a written change order under subparagraph 20a, unless the period is extended by the Agency procurement officer in writing, the CONTRACTOR shall respond with a claim for an adjustment. The requirement for a CONTRACTOR cannot be waived and shall be a condition precedent to the assertion of a claim. c. Claim barred after final payment. No claim by the CONTRACTOR for an adjustment hereunder shall be allowed if a written response is not given prior to final payment under this Contract. d. Other claims not barred. In the absence of a change order, nothing in this paragraph 20 shall be deemed to restrict the CONTRACTOR's right to pursue a claim under the Contract or for breach of contract. 21. Price Adiustment: a. Price adjustment. Any adjustment in the Contract price pursuant to a provision in this Contract shall be made in one or more of the following ways: (1) By agreement on a fixed price adjustment before commencement of the pertinent performance or as soon thereafter as practicable; (2) By unit prices specified in the Contract or subsequently agreed upon; (3) By the costs attributable to the event or situation covered by the provision, plus appropriate profit or fee, all as specified in the Contract or subsequently agreed upon; (4} In such other manner as the parties may mutually agree; or 12 Form AG2-GC(12/04) (5) In the absence of agreement between the parties, by a unilateral determination by the Agency procurement officer of the costs attributable to the event or situation covered by the provision, plus appropriate profit or fee, all as computed by the Agency procurement officer in accordance with generally accepted accounting principles and applicable sections of chapters 3-123 and 3-126 of the Procurement Rules. b. Submission of cost or pricing data. The CONTRACTOR shall provide cost or pricing data for any price adjustments subject to the provisions of subchapter 15, chapter 3-122 of the Procurement Rules. 22. Variation in Quantity for Definite Quantity Contracts. Upon the agreement of the STATE and the CONTRACTOR, the quantity of goods or services, or both, if a definite quantity is specified in this Contract, may be increased by a maximum of ten per cent (10%); provided the unit prices will remain the same except for any price adjustments otherwise applicable; and the procurement officer makes a wntten determination that such an increase will either be more economical than awazding another Contract or that it would not be practical to awazd another Contract. 23. Changes in Cost-Reimbursement Contract. If this Contract is acost-reimbursement Contract, the following provisions shall apply: a. The Agency procurement officer may at any time by written order, and without notice to the sureties, if any, make changes within the general scope of the Contract in any one or more of the following: (1) Description of performance (Attachment 1); (2) Time of performance (i.e., hours of the day, days of the week, etc.); (3) Place of performance of services; (4) Drawings, designs, or specifications when the supplies to be furnished aze to be specially manufactured for the STATE in accordance with the drawings, designs, or specifications; (5) Method of shipment or packing of supplies; or (6) Place of delivery. b. If any change causes an increase or decrease in the estimated cost of, or the time required for performance of, any part of the performance under this Contract, whether or not changed by the order, or otherwise affects any other terms and conditions of this Contract, the Agency procurement officer shall make an equitable adjustment in the (1) estimated cost, delivery or completion schedule, or both; (2) amount of any fixed fee; and (3) other affected terms and shall modify the Contract accordingly. c. The CONTRACTOR must assert the CONTRACTOR'S rights to an adjustment under this provision within thirty (30) days from the day of receipt of the written order. However, if the Agency procurement officer decides that the facts justify it, 13 Form AG2-GC(12/04) the Agency procurement officer may receive and act upon a proposal submitted before final payment under the Contract. d. Failure to agree to any adjustment shall be a dispute under paragraph 11 of this Contract. However, nothing in [his provision shall excuse the CONTRACTOR from proceeding with the Contract as changed. e. Notwithstanding the terms and conditions of subparagraphs 23a and 23b, the estimated cost of this Contract and, if this Contract is incrementally funded, the funds allotted for the performance of this Contract, shall not be increased or considered to be increased except by specific written modification of the Contract indicating the new Contract estimated cost and, if this Contract is incrementally funded, the new amount allotted to the Contract. 24. Confidentiality of Material. a. All material given to or made available to the CONTRACTOR by virtue of this Contract, which is identified as proprietary or confidential information, will be safeguazded by the CONTRACTOR and shall not be disclosed to any individual or organization without the prior written approval of the STATE. b. All information, data, or other material provided by the CONTRACTOR to the STATE shall be subject to the Uniform Information Practices Act, chapter 92F, HRS. 25. Publicity. The CONTRACTOR shall not refer to the STATE, or any office, agency, or officer thereof, or any State employee, including the head of the purchasing agency, the CPO, the DIRECTOR, the Agency procurement officer, or to the services or goods, or both, provided under this Contract, in any of the CONTRACTOR'S brochures, advertisements, or other publicity of the CONTRACTOR. All media contacts with ffie CONTRACTOR about the subject matter of this Contract shall be referred to the Agency procurement officer. 26. Ownership Rights and Copyright. The STATE shall have complete ownership of all material, both firtished and unfinished, which is developed, prepared, assembled, or conceived by the CONTRACTOR pursuant to this Contract, and all such material shall be considered "works made for hire." All such material shall be delivered to the STATE upon expiration or termination of this Contract. The STATE, in its sole discretion, shall have the exclusive right to copyright any product, concept, or material developed, prepared, assembled, or conceived by the CONTRACTOR pursuant to this Contract. 27. Liens and Warranties. Goods provided under this Contract shall be provided free of all liens and provided together with all applicable warranties, or with the warranties described in the Contract documents, whichever aze greater. 28. Audit of Books and Records of the CONTRACTOR. The STATE may, at reasonable times and places, audit the books and records of the CONTRACTOR, prospective contractor, subcontractor or prospective subcontractor which are related to: a. The cost or pricing data, and b. A State contract, including subcontracts, other than a fu-m fixed-price contract. 14 Form AG2-GC(12/04) 29. Cost or Pricing Data. Cost or pricing data must be submitted to the Agency purchasing officer and timely certifted as accurate for contracts over $100,000 unless the contract is for amultiple-term or as otherwise specified by the procurement officer. Unless otherwise required by the Agency procurement officer, cost or pricing data submission is not required for Contracts awarded pursuant to competitive sealed bid procedures. If certified cost or pricing data are subsequently found to have been inaccurate, incomplete, or noncurrent as of the date stated in the certificate, the STATE is entitled to an adjustment of the contract price, including profit or fee, to exclude any significant stun by which the price, including profit or fee, was increased because of the defective data. It is presumed that overstated cost or pricing data increased the contract price in the amount of the defect plus related overhead and profit or fee. Therefore, unless there is a clear indication that the defective data was not used or relied upon, the price will be reduced in such amount. 30. Audit of Cost or Pricing Data. When cost or pricing principles are applicable, the STATE may require an audit of cost or pricing data. 31. Records Retention. The CONTRACTOR and any subcontractors shall maintain the books and records that relate to the Contract and any cost or pricing data for three (3) years from the date of final payment tinder the Contract. 32. Antitrust Claims. The STATE and the CONTRACTOR recognize that in actual economic practice, overcharges resulting from antitrust violations aze in fact usually borne by the purchaser. Therefore, the CONTRACTOR hereby assigns to STATE any and all claims for overchazges as to goods and materials purchased in connection with this Contract, except as to overchazges which result from violations commencing after the price is establtshed under this Contract and which aze not passed on to the STATE under an escalation clause. 33. Patented Articles. The CONTRACTOR shall defend, indemnify, and hold harmless the State of Hawaii, the contracting agency, and their officers, employees, and agents from and against all liability, loss, damage, cost, and expense, including all attorneys' fees, and all claims, suits, and demands arising out of or resulting from any claims, demands, or actions by the patent holder for infringement or other improper or unauthorized use of any patented article, patented process, or patented appliance in connection with this Contract. The CONTRACTOR shall be solely responsible for correcting or curing to the satisfaction of the STATE any such infringement or improper or unauthorized use, including, without limitation: (a) furnishing at no cost to the STATE a substitute article, process, or appliance acceptable to the STATE, (b) paying royalties or other required payments to the patent holder, (c) obtaining proper authorizations or releases from the patent holder, and (d) furnishing such security to or making such arrangements with the patent holder as may be necessary to correct or cure any such infringement or improper or unauthorized use. 34. Governing Law. The validity of this Contract and any of its terms or provisions, as well as the rights and duties of the parties to this Contract, shall be governed by the laws of the State of Hawaii. Any action at law or in equity to enforce or interpret the provisions of this Contract shall be brought in a state court of competent jurisdiction in Honolulu, Hawaii. 15 Form AG2-GC(12/04) 35. Compliance with Laws. The CONTRACTOR shall comply with all federal, state, and county laws, ordinances, codes, rules, and regulations, as the same may be amended from time to time, that in any way affect the CONTRACTOR's performance of this Contract. 36. Conflict between General Conditions and Procurement Rules. In the event of a conflict between the General Conditions and the Procurement Rules, the Procurement Rules in effect on the date this Contract became effective shall control and aze hereby incorporated by reference. 37. Entire Contract. This Contract sets forth all of the Contracts, conditions, understandings, promises, wazranties, and representations between the STATE and the CONTRACTOR relative to this Contract. This Contract supersedes all prior Contracts, conditions, understandings, promises, warranties, and representations, which shall have no further force or effect. There aze no Contracts, conditions, understandings, promises, warranties, or representations, oral or written, express or implied, between the STATE and the CONTRACTOR other than as set forth or as referred to herein. 38. Severability. In the event that any provision of this Contract is declared invalid or unenforceable by a court, such invalidity or unenforceabiliry shall not affect the validity or enforceability of the remaining terms of this Contract. 39. Waiver. The failure of the STATE to insist upon the strict compliance with any term, provision, or condition of this Contract shall not constitute or be deemed to constitute a. waiver or relinquishment of the STATE's right to enforce the same in accordance with this Contract. The fact that the STATE specifically refers to one provision of the Procurement Rules or one section of the Hawaii Revised Statutes, and does not include other provisions or statutory sections in this Contract shall not constitute a waiver or relinquishment of the STATE'S rights or the CONTRACTOR'S obligations under the Procurement Rules or statutes. 40. Pollution Control. If during the performance of this Contract, the CONTRACTOR encounters a "release" or a threatened "release" of a reportable quantity of a "hazardous substance," "pollutant," or "contaminant" as those terms are deemed in section 128D-1, HRS, the CONTRACTOR shall immediately notify the STATE and all other appropriate state, county, or federal agencies as required by law. The Contractor shall take all necessary actions, including stopping work, to avoid causing, contributing to, or making worse a release of a hazardous substance, pollutant, or contaminant, and shall promptly obey any orders the Environmental Protection Agency or the state Department of Health issues in response to the release. In the event there is an ensuing cease-work period, and the STATE determines that this Contract requires an adjustment of the time for performance, the Contract shall be modified in writing accordingly. 16 Form AG2-GCQ2/04)