This
Construction Agreement (“this Agreement”) is executed
on March 11, 2008 by and between Impax Laboratories (Taiwan),
Inc. (hereinafter “Party A”), and Fu Tsu Construction
(hereinafter “Party B”).
WHEREAS, Party A wishes to engage Party B to construct
its First-phase Facility located in Chu-nan Science
Park.
NOW,
THEREFORE, the parties
hereby agree to the terms and conditions as follows:
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Article 1
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Name of Construction
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Impax
Laboratories (Taiwan), Inc. Chu-nan Science Park First-phase
Facility (hereinafter “Construction”).
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Article 2
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Location of
Construction
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Kedong 3
rd Rd., Exclusive Lot 12 of the Chu-nan Base,
Hsinchu Science Park.
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Article 3
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Scope of Construction
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To be referred
to in the bidding document, drawings, bidding form, construction
specifications, Q & A for bidders, and supplementary
notices.
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Article 4
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Tax-inclusive Contract Price: Two
Hundred Eighty-six Million New Taiwan dollars
exactly.
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The total price
of Construction is a fixed price that includes costs of materials,
equipment, wages, miscellaneous, government taxes (including the
value-added tax) and administrative fees, subject to no
fluctuations of market prices and wages. Still, when the
value-added tax is adjusted by the government, the contract price
shall be adjusted accordingly.
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Article 5
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Term of Construction
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1.
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Commencement of Construction: Party
B shall commence Construction and provide a commencement report
within seven days upon receipt of the Party A’s bid-awarding
notice after the final reward is decided.
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2.
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Deadline of Construction
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a.
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Construction shall be fully
completed within 365 calendar days (including all Saturdays and
Sundays) following the commencement. The Permit of Use is scheduled
to be obtained by September 30, 2008, and inspection will
begin on September 15, 2008. Deadline of Construction shall
also apply to other outsourced construction work designated by the
proprietor.
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b.
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On
the location of Construction, an area of 530 square meters dubbed
“R&D Area” shall be ready for production on
June 1, 2008. Therefore, construction of such R&D Area
shall be completed in a weather tight condition and delivered
(including the MEP work) by May 31, 2008.
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a.
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If
additional work exceeding the amount of jobs specified herein is
required as a result of any modification made to Construction,
Party B shall notify Party A of the number of additional working
days for Construction within 10 days, and the parties shall
negotiate for a working schedule extension.
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b.
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If
Term of Construction is affected as a result of force majeure, acts
of God or reasons attributable to Party A, Party B shall submit an
application for working schedule extension of Construction based on
the facts within 15 days following the occurrence of such
result. In the case where additional work requires less than half
day, the working day shall be ignored; the period more than half
day but less than one working day shall be treated as one day
(details of the deferral shall be supplied). The number of days
required shall be submitted to Architect, which will forward the
same to Party A for approval.
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c.
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The
deferred or additional period for Construction in the preceding two
paragraphs shall be counted consecutively according to the calendar
system. However, any national holiday below shall not be counted as
working days.
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(a)
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National Holidays: New Year Holiday,
Labor Day, National Day, and other holidays announced by the
Central Personnel Administration of the Executive Yuan not to be
counted as a working day.
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(b)
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Customary Holidays: Lunar New Year
Holidays, Qingming Festival, Dragon Boat Festival, Mid-Autumn
Festival and other holidays announced by the Central Personnel
Administration of the Executive Yuan not to be counted as a working
day.
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(c)
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National Election days and other
days announced by any level of the
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competent authority any time to be a
holiday and not to be counted as a working day.
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Article
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6 Method of Payment
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1.
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No
Advancements
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The
price of Construction is assessed in every two months based on the
amount of contracted work completed, in each time 95 percent
of the construction cost of the completed portion is payable, and
the outstanding amount shall be paid in full without interest when
Construction is fully completed, inspected and accepted, and after
Party B has completed the warranty of Construction.
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2.
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In
the event where Party A or Architect discovers that Party B has any
one of the situations below, the evaluation of completed works or
payment may be suspended until the causes to such suspension have
been moved:
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a.
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Party B fails to render the
construction service in accordance with the drawings, and delays
its improvement after it has been demanded by the
Architect.
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b.
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The
overall progress of Construction is legged behind by over 10
percent of the scheduled pipeline, or there is any concern that
Construction may not be completed before the deadline.
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c.
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Party B defaults any payment payable
to its contractor or materials supplier and therefore a dispute
over Construction has arises.
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d.
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Party A or a third party involved in
Construction seeks damages from Party B in vain.
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e.
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Party B is in breach of any term or
condition contained herein.
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f.
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Party B fails to honor any check or
suffers a similar financial crisis.
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3.
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The
seal specimen used by Party B for invoice of construction payment
shall be consistent with the one attached hereto. The right to
receive such payment shall not be transferred or assigned to others
without Party A’s agreement.
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4.
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If
due to modification of design, additional number of work or project
is required, such additional work or project shall not be assessed
or inspected unless Party A has completed the legal procedures
required.
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5.
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Any
amount payable by Party A arising herefrom shall, regardless of its
due day, be available for offsetting all the damages suffered or
expenses incurred by Party A as a result of Party B’s default
and breach of the provisions herein.
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Article 7
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Duties of Architect
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1.
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Duties of Architect include the
following:
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(a)
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To
review or modify the design, quality, or amount of work required by
Construction.
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(b)
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To
explain the construction specification and relevant rules
applicable to this Agreement.
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(c)
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To
review on daily reports, construction plans, detailed drawings and
prescheduled pipelines provided by Party B.
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(d)
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To
supervise and randomly inspect Construction and randomly inspect
the materials.
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(e)
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To
the extent approved by Party A, decide on Party B’s
applications.
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(f)
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To
review and approve on Party B’s request for
payments.
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(g)
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To
control quality of Construction and demand the progress and safety
and health of workers of Construction.
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(h)
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To
coordinate with other works related to Construction.
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(2)
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All
of the applications, reports and payment requests made by Party B
pursuant to this Agreement are subject to Architect’s
approval or forwarding. Party B shall also notify Architect and
Party A any filings or report to be submitted to the competent
authority pursuant to the law.
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(3)
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The
parties shall comply with all the decisions made by Architect
within the scope of its duty, and shall notify Architect in writing
of any objection within ten days after the decision is
made.
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Article 8
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Modification and Design of
Construction
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1.
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Party A has the right to modify, add
or reduce Construction any time at its discretion.
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2.
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In
the case of an unexpected condition, or when the actual condition
is far from what is shown in the design drawings, either Party A or
Party B has the right to request for change.
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3.
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In
the event where modification of Construction is required, Party B
shall comply with Party A’s written instruction without
objections once it is given. The amount of work to be added or
reduced shall be paid based on the unit prices attached hereto;
recognition of the amount of work added or reduced shall be subject
to the result from the amount specified herein deducting the one
that has been completed. Modification of the local construction
shall be counted according the amount of locations changed. If any
new work is required, its unit price shall be separately agreed. If
the added or reduced amount of work exceeds 10 percent of the
original amount specified herein, the unit price of the work
exceeded shall be separately agreed. If the work involved is merely
a minor modification or typically required in the practice, even if
such work is not specified in the drawings or construction
specifications, Party B shall pursue such work without objection or
requests for additional payment.
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Article 9
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Construction Plan
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(1)
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When submitting its bid, Party B
shall provide its construction plan, which shall
include:
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(a)
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Site organization chart, which
includes the name of key personnel, profile, and scope of
duty.
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(b)
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Construction implementation plan,
which instructs the plan to carry out each works, and how to
coordinate among projects.
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(c)
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Mobilization plan, which instructs
location of working places and accommodation, and the move-in and
operation date of the personnel, machinery and
equipment.
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(d)
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Construction pipelines, which
instructs the commencement and completion of each construction work
expected from each unit, construction order of such work, and the
number of working hours and dates for milestones.
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(e)
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Machinery and Equipment List, which
enumerates the name of each machine and equipment to be delivered
to Site, the working condition, working hours, and dates when
construction materials are supplied onsite.
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(f)
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Logistic Plan, which indicates the
plans concerning materials, reviews, purchasing, transportation,
and warehousing in the course of the construction.
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(g)
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Safety Plan, which instructs the
safety and health management system to be adopted in Construction,
and the relevant safety measures.
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(h)
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Quality Control Plan, which
instructs the quality control measures to be adopted in
Construction, which shall be overseen by a designated quality
control engineer.
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(i)
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Other proposals that may reduce the
costs of Construction, shorten the term of Construction, or
substitute plans not detrimental to safety, function and
quality.
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(j)
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Disaster Prevention Plan, which
instructs emergency measures in the case of a typhoon and rain
during Construction.
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(k)
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Coordination and management of
contractors’ construction interface.
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2.
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During Construction, Party B shall
fill out the daily report in a format agreed by Party A, and submit
the same to Architect, which will forward it for Party A’s
approval.
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Article 10
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Construction Drawings
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1.
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Party B has read this Agreement and
inspected the Site, and shall act in compliance with the Agreement.
Party B shall be liable for all the damages it suffers as a result
of its failure to comprehend the condition of the Site in
negligence. In the case of an obscure instruction that is
technically or customary required, Party B shall perform its duty
in accordance with Architect’s instruction without asking for
compensation. If the actual condition or man-made barrier during
the term of Construction is inconsistent with the drawings, Party B
shall immediately report to the Architect for a
resolution.
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2.
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Drawings of this Agreement: All of
the illustrations may be mutually supplementary. In the case of a
conflict between two drawings, the latest drawing shall prevail. In
the case of a conflict between a document and drawing, the drawing
shall prevail. At all times, large-scale drawings shall prevail
over small-scale drawings.
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3.
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Prior to commencement of every
project, Party B shall submit to Architect and Party A Work’s
detailed field drawings of the site and samples for review, so that
the progress of Construction will not be affected. If the order or
timing of submission of detailed drawings of Construction is
inappropriate or the review is not passed and consequently the
progress of Construction is affected, Party B shall not request for
extension of the deadline on such a ground. Materials concerning
the overall color matches shall be submitted altogether for
review.
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4.
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Party B shall be responsible for
illustration of the as-built drawing; Party B shall prepare the
triplets and one electronic copy of the drawing, and deliver the
same to Party A after such drawing has passed the review of
Architect.
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Article 11
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Site Management
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1.
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Party B itself shall, or appoint one
representative who has an experience of over 10 years in site
construction (facility construction) to, station onsite. The
representative shall oversee and maintain workers of Construction.
Party B shall be liable if any worker is in breach of the law or
has caused any dispute as the result of such breach. If any worker
is injured or killed in an accident, Party B shall deal with the
matter, and Party A shall not be liable for whatsoever. When
exiting the Site, the representative appointed by Party B shall
notify Party A of the name of his/her deputy; if Party A considers
that such representative appointed by Party B unsuitable for the
job, it may notify Party B to replace the person.
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2.
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With respect to the onsite
materials, machinery and equipment, regardless of whether they are
prepared by Party B or supplied by (or lent from) Party A, Party B
shall properly manage the items and liable for any lost or damage
of them.
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3.
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Party B shall film and record the
onsite situations before, after and throughout the term of
construction.
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4.
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Party B shall appoint a legally
qualified safety and health steward to station onsite on a
full-time basis, and be accountable for labor safety, health, and
environmental protection.
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5.
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The
construction work rendered by Party B shall be in line with the
rules prescribed by the Science Park Administration or other
competent authority.
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Article 12
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Machinery, Equipment and
Materials
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1.
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Unless otherwise prescribed herein,
all of the machinery, equipment and materials required by
Construction shall be supplied by Party B.
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2.
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Unless otherwise prescribed herein
or agreed by Architect, any machine or equipment supplied by Party
B and is part of Construction shall be a qualified new item.
Whenever a machine is arrived onsite, it shall be reported. Unless
otherwise prescribed herein, each item shall be supported by an
inspection report supplied by a professional institution. In the
case of exported machinery, Party B shall provide with the
certificate of country of origin (indicating the relevant location
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manufacturer)
at its own expense. Party B shall immediately remove from the Site
any machinery and equipment that fails to pass the inspection, and
shall be liable for all the consequential damages and costs arising
therefrom.
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3.
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Without the agreement of Architect
or Party A, any machinery, equipment or materials that have arrived
onsite and entered on the price calculation books shall not be
removed by Party B at will.
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4.
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Even if the equipment is inspected
at its arrival in the site, the Architect may decline or request a
substitute of such equipment which a defect is found during the
term of Construction.
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5.
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The
premises where Party B stores its equipment and instruments shall
be within the area approved by Party A, and the items stored up
shall not prevent the progress of Construction and traffic of the
streets.
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6.
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Within one month after the bid is
awarded, Party A has the right to decide the brand of the materials
to be used, and Party B shall not dispute over Party A’s
decision with any reason whatsoever. However, upon Party A or
Architect’s consent, Party B may use materials of other
brand, provided the substitute brand is in the same
quality.
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7.
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Within 20 days prior to any
need, Party B shall apply for the machinery, equipment and
materials to be supplied by Party A, so that the item can be
delivered onsite in a timely manner. If the delivery is
rescheduled, Party A shall notify Party B of any change one month
before the scheduled delivery. If the materials or machinery or
equipment to be supplied by Party A cannot be delivered on the
scheduled date and consequently Party B suspends Construction in
whole or in part, Party B may apply to Party A for an extension of
the Construction term , and may seek damages from Party A if any is
incurred.
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Article 13
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Onsite Safety and Health
Facilities
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Party B shall
provide meals, accommodation, health care and a safe and healthy
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environment for
onsite workers in accordance with the following:
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1.
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Labor Safety and Health Act and its
Enforcement Rules;
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2.
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Guidelines for Labor Safety and
Health Facilities;
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3.
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Relevant rules concerning standards
of construction safety and health facilities;
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4.
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To
participate in the Cleaning and Safety Agreement Organization
pursuant to the Labor Safety and Health Organization Management and
Auto-Checking Guidelines;
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5.
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Crane Equipment Safety
Rules;
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6.
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Guidelines for High-Elevation
Operations Protection Measures;
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7.
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Electric Construction Safety
Measures Explanation and Inspection Guidelines;
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8.
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Labor Health Administration
Rules;
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9.
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Labor Safety and Health Training
Rules; and
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10.
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Other applicable rules concerning
safety and health.
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Article 14
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Construction
Insurance
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Prior to the
commencement of Construction, Party B shall obtain and maintain the
Construction General Damages Insurance for Construction, regarding
Party A as a joint insured and beneficiary. Party B shall prepare
the insurance coverage according to Party A’s requests. Party
B shall, at its own expense, also insure Party A’s
supervisors and its own personnel against employer’s accident
liabilities (NT$3 million), regarding the parties as
beneficiaries.
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Party B has obtained the insurance
for Construction pursuant to the insurance content specified
below.
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2.
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Party B may increase the insured
amount as much as it is necessary; since the insurance fees have
been incorporated in the total bidding price, Party A will not
compensate for any accident liabilities occurred during the term of
Construction.
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Within the
prescribed time limit, Party B shall properly prepare and maintain
the Construction General Insurance, Construction Third-party
Liability Insurance, Employer’s Accident Liability, and
Neighboring Housing
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