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<br />Agreement between Client, KCDA and Contractor - Washington Page 12
<br />156691459.1
<br /> 15.1.2 Payment Request. The Client shall review
<br />and approve the draft Application for Payment, or state its
<br />reasons for disapproval. Upon the Client’s approval, and after
<br />the Contractor has furnished all data requested, the Co ntractor
<br />may submit to KCDA a payment request in the agreed-upon
<br />amount, in the form of a notarized, itemized AIA Application
<br />for Payment for Work performed during the prior calendar
<br />month. KCDA shall re-verify the amounts with the Client and,
<br />once verified and approved by the Client, will invoice the
<br />Client, and KCDA shall make payment to Contractor from
<br />funds received from the Client. Payment from the Client to
<br />KCDA is a condition precedent to payment from KCDA to the
<br />Contractor. Among other things, the Application shall state that
<br />prevailing wages have been paid in accordance with the prefiled
<br />statement(s) of intent to pay prevailing wages on file with
<br />KCDA and the Client and that all payments due Subcontractors
<br />from KCDA’s prior payments have been made. The
<br />submission of this Application constitutes a certification that
<br />the Work is current on the progress schedule, unless otherwise
<br />noted on the Application. If the Contractor believes it is entitled
<br />to payment for Work performed during the prior calen dar
<br />month in addition to the agreed -upon amount, the Contractor
<br />may submit to KCDA a separate written payment request
<br />specifying the exact additional amount due, the category in the
<br />Schedule of Values in which the payment is due, the specific
<br />Work for which the additional amount is due, and why the
<br />additional payment is due.
<br />
<br /> 15.1.3 Payments to Subcontractors. No payment
<br />request shall include amounts the Contractor does not intend to
<br />pay to a Subcontractor. If, after making a request for payment
<br />but before paying a Subcontractor for its performance covered
<br />by the payment request, the Contractor discovers that part or all
<br />of the payment otherwise due to the Subcontractor is subject to
<br />withholding from the Subcontractor for unsatisfactory
<br />performance or other reasons, the Contractor may withhold the
<br />amount as allowed under the subcontract, but it shall give the
<br />Subcontractor and KCDA and the Client written notice of the
<br />remedial actions that must be taken as soon as practicable after
<br />determining the cause for the withholding but before the due
<br />date for the Subcontractor payment, and pay the Subcontractor
<br />within eight working days after the Subcontractor satisfactorily
<br />completes the remedial action identified in the notice.
<br />
<br /> 15.2 Prevailing Wages. Pursuant to RCW
<br />39.12, the Contractor will not receive any payment until the
<br />Contractor and all Subcontractors have submitted a “Statement
<br />of Intent to Pay Prevailing Wage” to KCDA and the Client. The
<br />statement must have the approval of the Industrial Sta tistician
<br />of the Department of Labor and Industries before it is submitted
<br />to KCDA and the Client. The Contractor and the respective
<br />Subcontractors shall pay all fees required by the Department of
<br />Labor and Industries, including fees for the approval of the
<br />“Statement of Intent to Pay Prevailing Wages.” Approved
<br />copies of the “Statement of Intent to Pay Prevailing Wages”
<br />must be posted where workers can easily read them.
<br />
<br /> 15.3 Progress payments. Unless the Client
<br />informs the Contractor that a payment will be withheld as
<br />provided in Section 15.4, KCDA shall make progress payments
<br />within 30 days of approval of the payment request by the Client.
<br />
<br /> 15.4 Withheld Payments. Payments may be
<br />withheld on account of (1) defective Work not remedied, (2)
<br />claims filed by third parties, (3) failure of the Contractor to
<br />make payments properly to Subcontractors or for labor,
<br />materials or equipment or provide releases under
<br />Section 11.3.1, (4) reasonable evidence that the Work cannot be
<br />completed for the unpaid balance of the Contract Sum, (5)
<br />damage to KCDA, the Client, or another contractor, (6)
<br />reasonable evidence that the Work will not be completed within
<br />the Contract Time and that the unpaid balance would not be
<br />adequate to cover actual or liquidated damages for the
<br />anticipated delay, or (7) failure to carry out the Work in
<br />accordance with the Contract Documents. When KCDA
<br />intends to withhold all or part of a payment for any of the
<br />foregoing reasons, KCDA will provide the Contractor, within
<br />eight working days after KCDA’s receipt of the Application for
<br />Payment, written notification of the reasons that all or part of
<br />the payment is being withheld and what remedial actions the
<br />Contractor must take to receive the withheld amount.
<br />
<br /> 15.5 Substantial Completion.
<br />
<br /> 15.5.1 When the Contractor believes that the entire
<br />Work is Substantially Complete, it shall notify KCDA and the
<br />Client in writing. When the Client agrees, the Client will issue
<br />a Certificate of Substantial Completion. Substantial
<br />Completion is the stage in the progress of the Work when the
<br />construction is sufficiently complete, in accordance with the
<br />Contract Documents, so the Client can fully utilize the Work
<br />(or the designated portion thereof) for the use for which it is
<br />intended. All Work other than incidental corrective or punchlist
<br />work and final cleaning shall have been completed. The Work
<br />is not Substantially Complete if all systems and parts affected
<br />by the Work are not usable, if an occupancy permit (temporary
<br />or final) has not been issued, or if utilities affected by the Work
<br />are not connected and operating normally. The fact that the
<br />Client may use or occupy the Work or designated portion
<br />thereof does not indicate that the Work is Substantially
<br />Complete, nor does such occupation toll or change any
<br />liquidated damages due KCDA.
<br />
<br /> 15.5.2 Immediately before partial or complete
<br />occupancy, the Client will schedule an inspection tour of the
<br />area to be occupied. A representative of KCDA and/or the
<br />Client, A/E and Contractor will jointly tour the area and record
<br />items still remaining to be finished and/or corrected. The
<br />Contractor shall supply and install any items missed by the
<br />inspection but required or necessary for Final Completion as a
<br />part of the Contract Sum, notwithstanding their not being
<br />recorded during the inspection tour.
<br />
<br /> 15.6 Final Payment. Pursuant to RCW 60.28,
<br />completion of the Contract Work shall occur after the
<br />Contractor has notified KCDA and the Client in writing that the
<br />Work has been concluded and submits the items listed below to
<br />KCDA and the Client, any required occupancy permit has been
<br />issued, and the Client’s Board formally accepts the Project
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