Purchase Order Terms and Conditions

Scope of Work. The Contractor agrees to furnish all labor, materials, and equipment required to complete the scope of work defined on page 1 of this Purchase Order and subject to the plans and specifications for the Project (“PO”), attached hereto and incorporated herein by this reference (the “Work”).

Payment.The Owner agrees to pay the Contractor for the performance of the Work, in the sum identified in the attached PO (“Cost of the Work”), subject to adjustments for changes in the Work as may be agreed to in writing by the Parties. The Cost of the Work shall be at rates not higher than the standard paid at the place of the Project, except with the prior consent of the Owner. The Contractor shall not incur costs in excess of the Cost of the Work for the Project without the prior written consent of the Owner. The Owner shall not be responsible for the payment of any costs in excess of the Cost of the Work not approved in writing by the Owner prior to the Contractor’s incurring said costs. The Owner agrees to pay the Contractor in bi-monthly progress payments for all work completed. Payments will be due and payable within fifteen (15) days of invoice. Payment applications shall include conditional lien releases for the Work included within that pay application, as well as unconditional lien releases for the Work included in the prior pay application. Final payment to Contractor shall be made within thirty (30) days after “Substantial Completion” of the Work and submission of the final invoice to Owner. The term “Substantial Completion” means the stage in the progress of the Work when the Work, or designated portion thereof, is sufficiently complete in accordance with the PO so that the facilities constructed may be used or buildings may be occupied. Following Substantial Completion of the Work, Owner or its representative will prepare a list or lists of items of Work that remain to be replaced or completed in accordance with the requirements of the PO (the “Punch List”), which Punch List will be confirmed by the Contractor. The Contractor shall complete all of the Punch List Work expeditiously and timely, but in no event later than thirty (30) days following the date of Substantial Completion. Any and all late payments by Owner to Contractor shall bear interest from the due date thereof at a rate equal to the lower of the treasury bill rate or the highest lawful rate of interest payable by the Owner.

Entire Agreement. This PO represents the entire agreement between the Parties regarding the Work and supersedes any prior written or oral agreements or representations as to that Work. To the extent any proposal has been previously executed, this PO shall govern in the event of any inconsistencies.

Changes in Work. The Work shall be subject to changes by additions, deletions, or revisions by the Owner. The Owner shall notify Contractor of such changes by delivery of revised drawings, specifications, exhibits, or written orders. Whenever an adjustment in the PO price or time is required because of Owner’s change request, differing site conditions, errors in the plans, or other circumstances beyond the control of Contractor, the Contractor shall submit to the Owner, within three (3) business days, a detailed estimate with supporting calculations and pricing, together with any adjustments to the PO price and time. Pricing of the adjustment will be in general accordance with the pricing structure of this PO. The Contractor shall not perform changes in the Work or additional work until the Owner has approved, in writing, said changes in the Work or additional work and the changes to the PO price and time.

Suspension of Work. The Contractor may suspend the Work only as a result of the following: (A) Owner’s failure to timely pay sums due to the Contractor, until such payment is made; (B) a dispute over payment for extra work, differing site conditions, changes by Owner or other circumstances beyond Contractor’s control if such circumstances will cause the Contractor to suffer substantial hardship.

Inspection of Work. The Contractor shall make the Work accessible at all reasonable times for inspection by the Owner.

Permits, Licenses and Regulations. Unless otherwise provided in the PO, the Contractor shall obtain and pay for all permits and licenses necessary for the prosecution of the Work. The Contractor shall give all notices and comply with all laws, ordinances, rules and regulations bearing on the performance of the Work. If the Contractor observes that drawings, specifications, or other PO documents are at variance with such laws, ordinances, rules and regulations, the Contractor shall promptly notify Owner of such variance. All Work performed hereunder by the Contractor will be in strict compliance with any and all federal, state and local laws, ordinances, rules or regulations which may apply thereto, including but not limited to the Federal Occupation Safety and Health Act. Any fines, penalties, damages or other costs or expenses (including reasonable attorneys’ fees) imposed on or incurred by the Owner by reason of the Contractor’s failure to comply with the requirements of this paragraph, or in bringing the Work into such compliance, will be the responsibility of the Contractor and the Contractor agrees to indemnify the Owner against any such fines, penalties, damages, costs or expenses.

Performance.Contractor will be in default if it does any of the following in Owner’s reasonable discretion: (i) abandons the Work; (ii) fails to make prompt payment to its subcontractors or others who are entitled to payment with respect to the Work; (iii) assigns any portion of the PO without Owner's written consent; (iv) fails to perform, prosecute or complete all Work with diligence and in a good and workmanlike manner in accordance with applicable local, state and federal laws and regulations or perform Work not in compliance with the PO; (v) violates or disregards any laws or ordinances applicable to the Work; (vi) refuses or neglects to supply a sufficient number of properly skilled workers of the proper quality for the Work; (vii) fails in any respect to prosecute the Work promptly and diligently; (viii) fails to comply with any provisions of the PO; (ix) fails to maintain insurance as required by the PO or fails to provide evidence and/or additional named insured endorsements evidencing coverage of Owner as additional insured as required by the PO; (x) fails to execute the Work in accordance with the PO, schedule and scope of Work; (xi) fails to satisfy all city, county, state, or other applicable Governmental Authorities' requirements or inspections applicable to the Work; (xii) performs Work in such a manner that safety and proper construction may be jeopardized; (xiii) fails to remedy defective or deficient Work; (xiv) damages the work of Owner or another contractor on the Project; (xv) act in such a way that Owner has a reasonable doubt the Work can be completed. Remedies for Contractor default are as follows: Should Contractor fail to remedy any default within five (5) days after receiving written notice from Owner setting forth the nature of default, Owner may without liability or prejudice to any other right or remedy allowed under law or equity exercise any or all of the following non-exclusive remedies: (i) terminate the PO; (ii) terminate all or any portion of the PO and/or Contractor's right to proceed with all or any portion of the Work; (iii) withhold any monies which may be due, or nullify in whole or part any payment made to Contractor for Work or labor in connection with the PO, or any other contract between the parties to protect Owner from loss, expense and damage, including costs and attorneys' fees arising from the default; (iv) contract with others for the completion of such Work at Contractor's cost and expense; (vi) remedy the default and back charge Contractor for the costs or expenses to remedy such default, including any attorneys' fees and expert witness costs; (vi) enact any or all of the above remedies, or pursue any other remedy available at law or in equity against Contractor, in Owner's sole discretion.

Termination. In the event one Party becomes insolvent or fails to perform its undertakings under this PO or otherwise commits a breach or default under this PO, the other Party may terminate for cause. Notwithstanding the foregoing, no default by either Party shall result in a termination for cause or limitation of any rights of such Party unless and until the other Party shall have notified the defaulting Party in writing of said default, and (i) the defaulting Party shall have failed to cure said default within five (5) days after the receipt of said written notice where the default is capable of being cured within five (5) days, or (ii) if such party immediately with due diligence, commences to cure, correct or remedy such default and thereafter diligently and continuously pursues such cure, correction or remedy to completion, where such default cannot be cured within five (5) days. Notwithstanding the foregoing, under no circumstance shall any cure period last longer than thirty (30) days. In the event of a termination for cause, the terminating party shall be entitled to pursue any and all remedies available in law or in equity, subject to the defenses or counter-claims of the non-terminating party. The Owner, at any time upon five (5) days’ written notice to the Contractor, may terminate this PO for convenience. In such an event, the Contractor shall be paid its actual costs for the Work performed through the date of termination, along with costs reasonably incurred in demobilizing from the Project as expeditiously and efficiently as reasonably possible after receipt of such termination notice. As a condition to the Owner’s obligation to pay said costs incurred by the Contractor, the Contractor shall deliver to the Owner such invoices and other back up documentation of costs.

Insurance. The Contractor shall procure and maintain insurance of its operations under this PO consisting of the following coverages: (A) State required levels of workers’ compensation and employers’ liability insurance; (B) $1,000,000 commercial general liability insurance covering Contractor’s operations; and (C) $1,000,000 automobile liability insurance, including coverage for Contractor’s owned, hired and non-owned automobiles. Owner shall receive additional insured certificates from Contractor for all policies and shall have the option to have any additional Property owner listed as an AI.

Warranty. The Contractor warrants to the Owner that all materials and equipment furnished under this PO shall be new unless otherwise specified and that all work under this PO will be performed in a good and workmanlike manner consistent with the quality found in the County in which the Project is located, shall be of good quality, free from faults and defects, and in conformance with this PO. Contractor will perform the Work and furnish its best skill and judgment and cooperate with Owner in a manner that is proper, timely and consistent with professional standards in Contractor’s industry.

Indemnity.Owner shall indemnify, defend and hold harmless Contractor and its members, managers and affiliates and its and their respective employees, agents, members, managers, partners, shareholders, lenders and insurers for, from and against any and all claims, demands, judgments, actions, damages, losses, penalties, liabilities, costs and expenses (including, without limitation, reasonable attorneys’ fees and court costs) arising from or relating to the Work performed by Contractor, its authorized agents, employees, contractors and subcontractors on the Project to the extent arising from the negligence or willful misconduct of Owner. Contractor shall indemnify, defend and hold harmless Owner and its members, managers and affiliates and its and their respective employees, agents, members, managers, partners, shareholders, lenders and insurers for, from and against any and all claims, lien claims, demands, judgments, actions, damages, losses, penalties, liabilities, costs and expenses (including, without limitation, reasonable attorneys’ fees and court costs) arising from or relating to the Work performed by Contractor, its authorized agents, employees, contractors and subcontractors on the Project including, without limitation, arising from or relating to (i) the death or injury to people or damage or injury to property, (ii) any and all liens, stop notices and charges of any type, nature, kind or description which may at any time be filed or claimed against the site of the Project or any portion thereof, or the Owner as a consequence of acts or omissions of the Contractor, the Work performed by the Contractor or its agents, subcontractors, employees, anyone employed directly or indirectly by any of them or for whose acts they may be liable or any or all of them, (iii) any claims under workers' compensation acts and other employee benefit acts with respect to the Contractor’s employees or its subcontractors' employees arising out of the Work, (iv) the negligent or willful acts, errors or omissions of the Contractor, or its agents, employees, subcontractors, anyone employed directly or indirectly by any of them or for whose acts they may be liable or any or all of them in connection with the performance of the Work, (v) the Contractor's failure to fulfill its obligations under this PO in strict accordance with its terms, including, without limitation, the Contractor’s breach of any representations or covenants given under this PO, in any of the PO documents or elsewhere by the Contractor; or (vi) violation of any local, state or federal law, regulation or code by the Contractor or by any of the Contractor’s employees, agents, subcontractors or suppliers (collectively, the “Liability”), except to the extent arising from the negligence or willful misconduct of Owner. In the event Owner incurs any Liability by reason of strict liability or a similar legal theory, Contractor shall, nonetheless, indemnify, protect and hold Owner and each other indemnitee specified above harmless from such portion of such Liability that, directly or indirectly, relates to Contractor or its agents, employees, subcontractors, suppliers, anyone employed directly or indirectly by any of them or for whose negligent acts they may be liable or any or all of them. In the event that any claim for indemnification from the Contractor arises, the Owner shall have the right to withhold from any payments due or to become due to Contractor, an amount sufficient in its judgment to protect and discharge said indemnity or the Owner, in its sole but reasonable discretion, may require the Contractor to furnish a surety bond satisfactory to the Owner guaranteeing such protection and indemnity, which bond shall be furnished by the Contractor within five (5) days after written demand has been made therefor.

Defective Work. In the event the Contractor fails or refuses to complete, correct or repair defective Work within five (5) business days after having been requested by the Owner to do so, whether such request is made during the progress of the Work or after Substantial Completion, the Owner will have the right, but not the obligation to complete, repair or correct defective Work or have it done by other persons, and charge the cost thereof to the Contractor. The Contractor will, in addition, be liable to the Owner for all loss or damage which Owner may sustain by reason of the Contractor’s failure or refusal to timely complete, repair or correct defective Work. The rights and remedies of the Owner as set forth in this Section will be in addition to all other rights or remedies which may be available to the Owner at law or in equity.

Notice. All notices permitted or required to be given as provided herein shall be in writing and served personally, or served by certified mail postage prepaid return receipt requested, or by reputable overnight service sent to the party at the addresses listed on the PO.

Miscellaneous.If any provision of this PO, or any application of any such provision to any party or circumstance, shall be determined by any court of competent jurisdiction to be invalid and unenforceable to any extent, the remainder of the PO shall not be affected thereby, and each provision shall be valid and shall be enforced to the fullest extent permitted by law. This PO may be executed in one or more counterparts, each of which shall be deemed in original, and all of which together shall constitute one and the same instrument. The parties hereto agree to execute all documents necessary to effectuate the intent of this PO. The laws of the State of Montana shall govern the terms of this PO. The Parties agree that venue is proper in the County in which the Property is located, and the courts of that County shall have exclusive jurisdiction over claims raised in any dispute under this PO. Waiver of any breach by either party under this PO will not constitute a waiver of any subsequent breach of the same or any other provision hereof. Nothing in this PO will be construed so as to create the relationship of employer-employee or master-servant, and it is expressly understood that the Contractor will have the status of independent contractor with respect to the Owner. This PO will, in the event of any dispute over its meaning or appliance, be interpreted fairly and reasonably and neither more strongly for nor against either party. The Owner may, without consent of the Contractor, collaterally assign this PO to a lender providing financing for the Work or the Project. Contractor shall execute all consents reasonably required to facilitate such assignment. Contractor shall not assign this Agreement. The prevailing party in any legal action involving this PO will be entitled to receive from the other party reasonable attorney's fees, costs, and expenses incurred in addition to any other relief granted. Time is of the essence of this PO. The Contractor has provided the Owner with a progress schedule. The Contractor shall conform to that schedule, including any changes to that schedule that are agreed to by the Parties, or as required based upon circumstances beyond the Contractor’s control.