7.1.1 TxDOT's Disadvantaged Business Enterprise (DBE) Program and Historically Underutilized Businesses ("HUB") Certification Program applicable to the Project are set forth in Exhibit G. The purpose of the DBE and HUB Programs is to ensure that DBEs and HUBs shall have an equal opportunity to participate in the performance of contracts financed in whole or in part with federal funds. The DBE/HUB participation goals for the Project as a whole are 4% DBE participation and 4% HUB participation. Developer shall comply with all requirements set forth in Exhibit G and the DBE/HUB Performance Plan. TxDOT shall specify individual DBE/HUB participation goals with its issuance of each NTP. Such individual DBE/HUB participation goals specified for each Pilot System and Project Segment may vary in TxDOT's discretion; provided, however, that the required overall DBE/HUB participation for the Project shall not exceed the above-specified percentages.
7.1.2 Developer shall include provisions to effectuate Section 7.1.1 and Exhibit G in every Subcontract (including purchase orders and in every subcontract of any Developer-Related Entity for Work), and shall require that they be included in all Subcontracts at lower tiers, so that such provisions will be binding upon each Subcontractor.
7.2.1 Developer shall not, and shall cause the Subcontractors to not, discriminate on the basis of race, color, national origin or sex in the performance of the Work under the Contract Documents. Developer shall carry out, and shall cause the Subcontractors to carry out, applicable requirements of 49 CFR Part 26 in the award and administration of FHWA-assisted agreements. Failure by Developer to carry out these requirements is a material breach of this Agreement, which may result in the termination of the Contract Documents or such other remedy as TxDOT deems appropriate.
7.2.2 Developer shall include Section 7.2.1 in every Subcontract (including purchase orders and in every subcontract of any Developer-Related Entity for Work), and shall require that they be included in all Subcontracts at lower tiers, so that such provisions will be binding upon each Subcontractor.
7.2.3 Developer confirms for itself and all Subcontractors that Developer and each Subcontractor has an equal employment opportunity policy ensuring equal employment opportunity without regard to race, color, national origin, sex, age, religion or handicap; and that Developer and each Subcontractor maintains no employee facilities segregated on the basis of race, color, religion or national origin. Developer shall comply with all applicable Equal Employment Opportunity and nondiscrimination provisions set forth in Exhibit D, and shall require its Subcontractors to comply with such provisions.
7.3.1 Each instrument evidencing any agreement of Developer with any Subcontractor shall provide, in terms and in form and substance satisfactory to TxDOT that: (a) the rights of Developer under such instrument are assigned to TxDOT contingent only upon delivery of written request from TxDOT or its successor or assign following default by Developer or termination or expiration of this Agreement; and (b) all warranties (express and implied) of such Subcontract shall inure to the benefit of TxDOT.
7.3.2 Developer shall provide TxDOT with a list of all Subcontracts with each monthly update, shall allow TxDOT access to all Subcontracts and records regarding Subcontracts and shall deliver to TxDOT, within 10 Days after execution, copies of all Major Subcontracts and, within 10 Days after receipt of a request from TxDOT, copies of all other agreements or documents as may be requested.
7.3.3 The retention of Subcontractors by Developer will not relieve Developer of its responsibility hereunder or for the quality of the Work or materials provided by it. Developer will at all times be held fully responsible to TxDOT for the actions, omissions, negligence, willful misconduct, or breach of applicable Law or contract by its Subcontractors and persons employed by them and no Subcontract entered into by Developer will impose any obligation or liability upon TxDOT to any such Subcontractor or any of its employees. Nothing in this Agreement will create any contractual relationship between TxDOT and any Subcontractor of Developer
7.3.4 The following requirements shall apply to Subcontracts:
(a) Developer shall, prior to soliciting any bids for performance of work or labor or rendering of services relating to the design or construction of any portion of the Project or for special fabrication, assembly and installation o any portion of the Work, submit to TxDOT for its review and approval a procedure for the conduct of the bidding and approval process applicable to Major Subcontracts. Developer may use procedures set forth in the TxDOT Standard Specifications or may submit alternative procedures to TxDOT for approval. Developer shall not enter into any Major Subcontracts except in accordance with the foregoing procedure. Once Developer has entered into any Major Subcontract, Developer shall not have the right to make any substitution of such Subcontractor except with TxDOT's prior written approval.
(b) As soon as a potential Subcontractor has been identified by Developer, but in no event less than 30 Days prior to the scheduled initiation of Work by such proposed Subcontractor, Developer shall notify TxDOT in writing of the name, address, phone number and contact name of such Subcontractor.
(c) Each Subcontract shall include terms and conditions sufficient to ensure compliance by the Subcontractor with the requirements of the Contract Documents, and shall include those terms that are specifically required by the Contract Documents to be included therein. All Subcontracts, including Subcontracts with Suppliers, shall incorporate terms substantially similar to those contained in this Agreement, specifically including an agreement by the Subcontractor to participate in any dispute proceeding pursuant to Section 19, if such participation is requested by either TxDOT or Developer, and a requirement to allow audits by TxDOT as provided in Section 21.4.
7.3.5 Each Subcontract shall:
(a) Set forth a standard of professional responsibility or a standard for commercial practice equal to the requirements of the Contract Documents and prudent industry standards for work of similar scope and scale and shall set forth effective procedures for claims and change orders.
(b) Require the Subcontractor to carry out its scope of work in accordance with the Contract Documents, the Governmental Approvals and applicable Law, including the applicable requirements of the DBE Performance Plan.
(c) Include a covenant to maintain all licenses required by applicable Law, and set forth warranties, guaranties and liability provisions of the contracting party in accordance with good commercial practice for work of similar scope and scale.
(d) Be fully assignable without cost to TxDOT, such assignability to include the benefit of all Subcontractor warranties, indemnities, guarantees and professional responsibility and include express requirements that: (i) it will maintain usual and customary books and records for the type and scope of operations of business in which it is engaged (e.g., constructor, equipment supplier, designer, service provider); (ii) permit audit thereof by Developer, and provide progress reports to Developer appropriate for the type of work it is performing sufficient to enable Developer to provide the reports it is required to furnish TxDOT under this Agreement; and (iii) allow TxDOT to assume the benefit of Developer's rights with liability only for those remaining obligations of Developer accruing after the date of assumption by TxDOT. No such assignment shall release or relieve Developer from its obligations or liabilities under the assigned Subcontract.
(e) Not be assignable by the Subcontractor without Developer's prior written consent.
(f) With respect to any Subcontract which, when aggregated with all Subcontracts between Developer and such Subcontractor for the same Fiscal Year, is in excess of $250,000: (i) be terminable by the Subcontractor only for cause; and (ii) include an indemnity from the Subcontractor in favor of Developer and the Indemnified Parties against any and all Losses arising out of, related to or associated with, the actions, omissions, negligence, willful misconduct, or breach of applicable Law or contract by the Subcontractor or any of its officers, employees, agents or representatives.
(g) Expressly require the Subcontractor to participate in meetings between Developer and TxDOT, upon TxDOT's request, concerning matters pertaining to such Subcontract or its work, provided that all direction to such Subcontractor shall be provided by Developer, and provided further that nothing in this clause (g) shall limit the authority of TxDOT to give such direction or take such action which, in its sole opinion, is necessary to remove an immediate and present threat to the safety of life or property.
(h) Expressly provide that all Liens, claims and charges of the Subcontractor and its subcontractors at any time shall not attach to any interest of TxDOT in the Project or the Final ROW.
(i) Be consistent in all other respects with the terms and conditions of this Agreement to the extent such terms and conditions are applicable to the scope of work of such Subcontractors, and include all provisions required by this Agreement.
7.3.6 Developer shall not amend any Subcontract with respect to any of the foregoing matters without the prior written consent of TxDOT. All Subcontracts with Affiliates shall be on terms no less favorable (as determined by TxDOT) to Developer than to non-Affiliates of the Subcontractor. Developer shall not enter into any Subcontracts with any Person then debarred or suspended from submitting bids by any agency of the State.
7.4.1 The Contract Documents identify certain job categories of Key Personnel for the Project. Developer shall not change, or permit any change in, any Key Personnel without the prior written consent of TxDOT in accordance with TP Section _____.
7.4.2 All individuals performing Work shall have the skill and experience and any licenses required to perform the Work assigned to them. If TxDOT determines, in its sole discretion, that any Person employed by Developer or any Subcontractor is not performing the Work in a proper, desirable and skillful manner or is detrimental to the progress of the Work and/or the Project, then, at the written request of TxDOT, Developer shall remove such Person from the Project and such Person shall not be reemployed on the Project without the prior written approval of TxDOT. If such Person is not removed or if Developer fails to ensure that skilled and experienced personnel are furnished for the proper performance of the Work, then TxDOT may suspend the affected portion of the Work by delivery of written notice of such suspension to Developer. Such suspension shall in no way relieve Developer of any obligation contained in the Contract Documents or entitle Developer to a Claim or Change Order. Once compliance is achieved, TxDOT will notify Developer and Developer shall be entitled to and shall promptly resume the Work. During the period of any such suspension, Developer shall not be entitled to the payment of any portion of the applicable Price or any other payment hereunder.
7.4.3 Developer shall designate in writing who shall have onsite field and office authority to represent and act for Developer. An authorized representative shall be present at the jobsite at all times while Work is actually in progress at the jobsite. Developer shall provide phone and pager numbers for all Key Personnel. TxDOT requires the ability to contact the following Key Personnel 24 hours per Day, seven Days per week: ________________________.
7.4.4 Developer acknowledges and agrees that the award of this Agreement by TxDOT to Developer was based, in large part, on the qualifications and experience of the personnel listed in the Proposal and Developer's commitment that such individuals would be available to undertake and perform the Work. Developer represents, warrants and covenants that such individuals are available for and will fulfill the roles identified for them in the Proposal in connection with the Work. Unless otherwise agreed to by TxDOT in writing, individuals filling Key Personnel roles shall be available for the Work and shall maintain active involvement in the prosecution and performance of the Work. In addition to the foregoing, TxDOT reserves the right to require a 100% time commitment per position from any Key Personnel if TxDOT, in its sole discretion, determines that such personnel are not devoting sufficient time to the prosecution and performance of the Work.
7.4.5 If an individual filling one or more Key Personnel roles is not available for the Work and does not maintain active involvement in the prosecution and performance of the Work, Developer acknowledges that TxDOT, the Work and the Project will suffer significant and substantial Losses and that it is impracticable and extremely difficult to ascertain and determine the actual Losses which would accrue to TxDOT in such event. Therefore, if certain Key Personnel are not available or not actively involved in the prosecution and performance of the Work, as determined by TxDOT, in its sole discretion, Developer agrees to pay TxDOT a liquidated amount as follows, for each position held by such individual, as deemed compensation to TxDOT for such Losses:
| POSITION | LIQUIDATED AMOUNT |
|---|---|
| Project manager | $100,000 |
| Deputy project managers | $50,000 |
| All other positions noted with an asterisk in Exhibit X | $25,000 |
Developer understands and agrees that any damages payable in accordance with this Section 7.4.5 are in the nature of liquidated damages and not a penalty and that such sums are reasonable under the circumstances existing as of the Effective Date. TxDOT shall have the right to deduct or draw upon any amount owed by Developer to TxDOT hereunder from any amounts owed by TxDOT to Developer, including any Retainage which may be payable by TxDOT to Developer, or from any bond or letter of credit held by TxDOT under this Agreement. Notwithstanding the foregoing, Developer shall not be liable for liquidated damages under this Section 7.4.5 if (i) Developer removes or replaces such personnel at the direction of TxDOT; (ii) such individual is unavailable due to death, retirement, injury or no longer being employed by the applicable Developer-Related Entity (provided that moving to an affiliated company shall not be considered grounds for avoiding liquidated damages), or (iii) such individual is unavailable due to TxDOT's failure to issue Pilot System NTP 1 within 180 Days of the Proposal Date for a reason other than the fault, act or omission of any Developer-Related Entity; provided, however, in each such case, Developer shall promptly propose to TxDOT a replacement for such personnel, which individual shall be subject to TxDOT's review and written consent. If Pilot System NTP 1 has not been issued within 180 Days after the Proposal Date, Developer shall have 30 Days after issuance of Pilot System NTP 1 to identify any change in Key Personnel without incurring any liquidated damages. Following any TxDOT-approved substitution or replacement of a Key Personnel pursuant to the terms hereof, the new individual shall be considered a Key Personnel for all purposes under this Agreement, including the provisions of this Section 7.4.5 relative to liquidated damages.
7.4.6 Developer acknowledges and agrees that the Key Personnel positions are of critical importance to TxDOT and the Project. In addition to the approval rights of TxDOT set forth in Section 7.4.2 and the liquidated damages set forth in Section 7.4.5, if an individual in certain Key Personnel positions delineated on Exhibit X leave that position for a reason other than as set forth in clauses (i)-(iii) of Section 7.4.5, TxDOT shall have the unilateral right to terminate this Agreement without further liability to Developer, except for payment for such Work that has been completed and accepted as of the date of termination, unless Developer provides TxDOT a replacement acceptable to TxDOT within 30 Days after the earlier of (i) the date on which such individual has left his/her position; or (ii) Developer or TxDOT becomes aware that such individual intends to leave his/her position. In connection with a termination under this Section 7.4.6, Developer shall not be entitled to any payment of profit, overhead or any settlement costs under Section 15, but shall only be entitled to the payment of Developer's actual costs incurred and not previously paid for by TxDOT in connection with Work which has been completed and accepted as of the termination date.
7.4.7 Any position on the Developer's organizational chart or within the Developer's organization structure that is above that of a Key Personnel position for which liquidated damages may apply will be deemed to be a Key Personnel position and, for purposes of liquidated damages under Section 7.4.5, shall be at the level which is immediately higher than the Key Personnel immediately below that position (e.g., an individual that reports into the deputy project manager level but is higher than the other Key Personnel level would be considered a deputy project manager for this purpose).
Developer shall supervise and be responsible for the actions, omissions, negligence, willful misconduct, or breach of applicable Law or contract by any Developer-Related Entity, as though Developer directly employed all such Persons.
