Construction Contract Atlantic Corridor Plan Puebla Panama (Northern Highway CA-5) Villa San Antonio

Approve in all and each of its parts the CONSTRUCTION CONTRACT PROJECT: PROGRAM FOR IMPROVEMENT OF THE ATLANTIC CORRIDOR OF THE PUEBLA PANAMA PLAN (SECTIONS OF HIGHWAY CA-5 NORTH) SECTION I: BYPASS VILLA DE SAN ANTONIO-FREEWAY OF COMAYAGUA, for an amount of TWO HUNDRED THIRTEEN MILLION THREE HUNDRED TWENTY-SIX THOUSAND, SIX HUNDRED FIFTY-SIX LEMPIRAS WITH SIXTEEN CENTS (L. 213,326,656.16), signed on August 1, 2009 between Engineer JOSÉ ROSARIO BONANNO, acting in his capacity as Secretary of State in the Offices of Public Works, Transportation and Housing (SOPTRAVI), on behalf of the State of Honduras, appointed through Executive Agreement No. 002-2006, dated January 27, 2006, hereinafter called "THE CONTRACTING PARTY", on one part, and SONIA ENRIQUETA GÁMEZ PANCHAME DE ALVARADO, of Honduran nationality, of legal age, married, with Identity Card No. 1804-1944-00037, acting in her capacity as Legal Representative of the Construction Company: Construction Professionals, S.A. DE C.V. (PRODECON), hereinafter called "THE CONTRACTOR" on the other part, shall execute the Project: Program for Improvement of the Atlantic Corridor of the Puebla Panama Plan, Highway CA-5 North; Section I: Bypass Villa de San Antonio - Freeway of Comayagua hereinafter called "the Works" and the Contracting Party has accepted the Offer for the execution and completion of such Works and the correction of any defects thereof; consequently, this Contract attests to the following: In this Contract has been incorporated as part of its general and special provisions of the Contract to which reference is made hereinafter, and the same shall be considered part of this Contract and shall be read and interpreted as part thereof. 2. In consideration of the payments that the Contractor shall make to the Contracting Party as subsequently mentioned, the Contractor hereby commits to the Contracting Party to execute and complete the Works and to correct any defects thereof in accordance in all respects with the provisions of the Contract. 3. The Contracting Party hereby commits to pay the Contractor as consideration for the execution and completion of the Works and the correction of its defects, the Period of the Contract or those sums that become payable under the provisions of the Contract in the time and manner established therein. 4. The price of this contract is for the amount of TWO HUNDRED THIRTEEN MILLION, THREE HUNDRED TWENTY-SIX THOUSAND, SIX HUNDRED FIFTY-SIX LEMPIRAS WITH 16/100 CENTS (L.213,326,656.16), a value that corresponds to the works described in clause CGC 1. (dd) of the Special Conditions of the Contract and which is itemized in the Bill of Quantities contained in Appendix A. 5. In accordance with what is provided in Section 1 Dates of Initiation of Works, the Record of Initiation of the Contract shall be signed in accordance with Clause CGC 1. (r) of the CEC. 6. By virtue of the fact that the Contractor included in its offer the construction of the Grade Separations, the Contractor shall make effective the payment of the agreed advance in the following manner: a) Conejo) and Palmerola Airport - Industrial Parks (Unilever and Maravilla Foods) through so-called "Grade Separations", which are described in clause CGC 1.1 (dd) of the Special Conditions of this Contract, the Contractor is obligated to construct said Grade Separations at the prices offered in accordance with the "Bill of Quantities" contained in Appendix A-1, according to the following conditions: a) That the Contracting Party obtain financing for the execution of such works within a period of six (6) calendar months counted from the date indicated in the corresponding Start Order, extendable at the will of both parties, which shall be expressed through letters, without requiring the modification of this contract. b) If financing is obtained under the terms provided in the preceding subsection a), the Contract Price shall be increased by an amount of EIGHTY-FOUR MILLION, FIVE HUNDRED SEVENTY-SEVEN THOUSAND, SIX HUNDRED TWENTY-THREE LEMPIRAS WITH 77/100 (L.84,577,623.77), value offered for the construction of the Grade Separations and which is itemized in Appendix A-1, for a total contract price of TWO HUNDRED NINETY-SEVEN MILLION, NINE HUNDRED FOURTH TWO HUNDRED SEVENTY-NINE LEMPIRAS WITH 93/100 CENTS (L.297,904,279.93). c) When financing is available, the Contracting Party shall communicate this to the Contractor so that it may proceed to expand the performance guarantees to the satisfaction of the Contracting Party, as well as to the updating of the Advance Investment Plan. d) It is understood that the execution of the Grade Separations is comprised within the time period established in Clause CGC 1.1 (r) of the CEC, subject to extension in accordance with what is agreed in Clause CGC 28 of the CEC. 6. By virtue of the fact that the Contractor included in its offer the construction of the Grade Separations, the Contractor shall make effective the payment of the agreed advance in the following manner: a) The advance shall be calculated based on the contract price indicated in the preceding Clause 4, under the conditions established in Clause CGC 51.1 of the CEC, with the portion of the advance corresponding to the Grade Separations remaining pending, which shall be paid provided that the conditions provided in the preceding Clause 5 are met. b) If such conditions are met, the payment of the advance for the construction of the Grade Separations shall be constituted in a single portion, and the Contractor shall be obligated to invest this portion of said advance in the construction of the Grade Separations, within a period of one (1) month counted from the date of payment thereof, and Clause CGC 51.1 of the CEC shall also apply where pertinent. 7. The following documents are part of this present contract and shall be read and interpreted jointly:

• a)

  The General Conditions of the Contract (Annex 1) from Page No. 2 to 28.

• b)

  The Special Conditions of the Contract (Annex 2) from Page No. 29 to 63.

• c)

  APPENDIX "A" Contractual Budget, Bill of Quantities and Contract Price, which excludes the Grade Separations.

• d)

  APPENDIX "A-1", Bill of Quantities and Prices corresponding to the Grade Separations.

• e)

  APPENDIX "B" Table No.1 Work Activities and Materials Subject to Price Adjustments (Annex No.4).

• f)

  APPENDIX "C" Table No. 2 Unit Consumption Table of Diesel for Work Activities subject to price adjustment by diesel.

• g)

  The General and Special Technical Specifications of Construction contained in the Bidding Document LPI-GGPE-DGC No.01-07.

• h)

  The Offer presented by the Contractor.

• i)

  The Bidding Documents, Addenda and Clarifications of the Bidding Process No. LPI-GGPE-DGC No.01-07.

• j)

  Official Letters, Communications and Notes exchanged between the parties related to this Contract. In witness whereof the parties sign this Contract on the day, month and year indicated above. (F) JOSÉ ROSARIO BONANNO, Secretary of State in the Office of Public Works, Transportation and Housing, SOPTRAVI. THE CONTRACTING PARTY. (F) SONIA ENRIQUETA GÁMEZ PANCHAME DE ALVARADO, Legal Representative of the Company PRODECON; THE CONTRACTOR". General Conditions of the Contract Index of Clauses A. General Provisions 1..................... Definitions. 2..................... Interpretation. 3..................... Language and Applicable Law. 4..................... Decisions of the Works Manager. 5..................... Delegation of Functions. 6..................... Communications. 7..................... Subcontracts. 8..................... Other Contractors. 9..................... Personnel. 10................... Risks of the Contracting Party and the Contractor. 11................... Risks of the Contracting Party. 12................... Risks of the Contractor. 13................... Insurance. 14................... Site Investigation Reports of the Works. 15................... Inquiries about the Special Conditions of the Contract. 16................... Construction of the Works by the Contractor. 17................... Completion of the Works on the scheduled date. 18................... Approval by the Works Manager. 19................... Safety. 20................... Discoveries. 21................... Taking Possession of the Works Site. 22................... Access to the Works Site. 23................... Instructions, Inspections and Audits. 24................... Disputes. 25................... Procedures for the Resolution of Disputes. 26................... Replacement of the Conciliator. 27................... Programs. 28................... Extension of the Scheduled Completion Date. 29................... Acceleration of the Works. 30................... Delays Ordered by the Works Manager. 31................... Administrative Meetings. 32................... Early Warning. 33................... Identification of Defects. 34................... Tests. 35................... Correction of Defects. 36................... Uncorrected Defects. 37................... Bill of Quantities. 38................... Modifications in Quantities. 39................... Variations. 40................... Payments for Variations. 41................... Cash Flow Projections. 42................... Payment Certificates. 43................... Payments. 44................... Compensable Events. 45................... Taxes. 46................... Currencies. 47................... Price Adjustments. 48................... Retentions. 49................... Liquidation for Damages. 50................... Bonuses. 51................... Advance Payment. 52................... Guarantees. 53................... Day Work. 54................... Cost of Repairs. E. Completion of the Contract. 55................... Completion of the Works. 56................... Acceptance of the Works. 57................... Final Settlement. 58................... Operation and Maintenance Manuals. 59................... Termination of the Contract. 60................... Fraud and Corruption. 61................... Payments after Termination of the Contract. 62................... Property Rights. 63................... Release of Performance. 64................... Suspension of Loan Disbursement from the Bank. 65................... Eligibility. "GENERAL CONDITIONS OF THE CONTRACT. A. General Provisions. 1. Definitions 1.1 The words and expressions defined appear in bold. (

  • a)

    The Conciliator is the person jointly appointed by the Contracting Party and the Contractor or failing that, by the Nominating Authority in accordance with clause 26.1 of these CGC, to resolve in the first instance any dispute, in accordance with the provisions of clauses 24 and 25 of these CGC. (

  • b)

    The Bill of Quantities is the list duly prepared by the Offeror, with indication of the quantities and prices, which forms part of the Offer. (

  • c)

    Compensable Events are those defined in clause 44 of these CGC. (

  • d)

    The Completion Date is the date of completion of the Works, certified by the Works Manager in accordance with Subclause 55.1 of these CGC. (

  • e)

    The Contractor is the Contract between the Contracting Party and the Contractor to execute, complete and maintain the Works. It comprises the documents enumerated in Subclause 3 of these CGC. (

  • f)

    The Contractor is the natural or legal person whose Offer for the execution of the Works has been accepted by the Contracting Party. (

  • g)

    The Contractor's Offer is the bidding document that was completed and delivered by the Contractor to the Contracting Party. (

  • h)

    The Contract Price is the price established in the Letter of Acceptance and subsequently adjusted in accordance with the provisions of the Contract. (

  • i)

    Calendar Days. Months mean (y) Day Work means a variety of work that is paid based on the time utilized by the Contractor's employees and equipment, in addition to payments for materials and plant used. (

  • J)

    The Defect Responsibility Certificate is the certificate issued by the Works Manager once the Contractor has corrected the defects. (m) Period of Responsibility for Defects is the period stipulated in Subclause 35.1 of the CEC and calculated from the date of completion. (n) The Plans include the calculations and other information provided or approved by the Works Manager for the execution of the Contract. (o) The Contracting Party is the party that contracts with the Contractor for the execution of the Works, as stipulated in the CGC. (p) Equipment is the machinery and vehicles of the Contractor that have been temporarily transferred to the Site for the construction of the Works. (q) The Initial Contract Price is the Contract Price indicated in the Letter of Acceptance of the Contracting Party. (r) The Scheduled Completion Date of the Works is the date on which the Contractor is expected to complete the Works and which is specified in the CEC. This date may be modified only by the Works Manager through an extension of the deadline or an order to accelerate the works. (s) Materials are all supplies, including fungible goods, used by the Contractor to be incorporated in the Works. (t) Plant is any integral part of the Work that has a mechanical, electrical, chemical or biological function. (u) The Works Manager is the person whose name is indicated in the CEC (or any other competent person appointed by the Contracting Party with notice to the Contractor, to act in replacement of the Works Manager), responsible for supervising the execution of the Works and administering the Contract. (v) CEC means the Special Conditions of Contract. (w) The Site is everything that the Contract requires the Contractor to construct, install and integrate the Contracting Party as defined in the CEC. (x) The Site Investigation Reports of the Works, included in the bidding documents, are standard reports, based on facts, and which refer to the conditions of the surface and subsurface of the Works Site. (y) Specifications means the specifications of the Works included in the Contract and any modification or addition made or approved by the Works Manager. (z) The Start Date is the earliest date on which the Contractor shall begin the execution of the Works and which is stipulated in the corresponding Start Order, which does not necessarily coincide with any of the dates of taking possession of the Works Site. (aa) Subcontractor is a natural or legal person, contracted by the Contractor to perform a part of the work of the Contract, and which includes work at the Works Site. (bb) Temporary Works are the works that the Contractor must design, construct, install and remove, and which are necessary for the construction or installation of the Works. (cc) A Variation is an instruction issued by the Works Manager that modifies the Works. (dd) The Works is everything that the Contract requires the Contractor to construct, install and integrate the Contracting Party as defined in the CEC. (x) The Site Investigation Reports of the Works, included in the bidding documents, are standard reports, based on facts, and which refer to the conditions of the surface and subsurface of the Works Site. (y) Specifications means the specifications of the Works included in the Contract and any modification or addition made or approved by the Works Manager. (z) The Start Date is the earliest date on which the Contractor shall begin the execution of the Works and which is stipulated in the corresponding Start Order, which does not necessarily coincide with any of the dates of taking possession of the Works Site. (aa) Subcontractor is a natural or legal person, contracted by the Contractor to perform a part of the work of the Contract, and which includes work at the Works Site. (bb) Temporary Works are the works that the Contractor must design, construct, install and remove, and which are necessary for the construction or installation of the Works. (cc) A Variation is an instruction issued by the Works Manager that modifies the Works. (dd) The Works is everything that the Contract requires the Contractor to construct, install and integrate the Contracting Party as defined in the CEC. 2. Interpretation. 2.1 For the interpretation of these CGC, if the context so requires, the singular also means plural, and the masculine also means feminine and vice versa. The headings of the clauses have no relevance by themselves. The words used in the Contract have their ordinary meaning unless specifically defined. The Works Manager shall provide clarifications to inquiries about these CGC. 2.2 If the CEC stipulate the completion of the Works by sections, the references made in the CGC to the Works, to the Completion Date and to the Scheduled Completion Date apply to each Section of the Works (except for specific references to the Completion Date and Scheduled Completion Date in the entirety of the Works). 2.3 The documents that constitute the Contract shall be interpreted in the following order of priority: (

    • a)

      Contract, (

    • b)

      Letter of Acceptance, (

    • c)

      Offer, (

    • d)

      General and Special Conditions of the Contract, (

    • e)

      Specifications, (g) Plans, (h) Bill of Quantities; and, (i) Any other document that in the CEC is specified to form an integral part of the Contract. 3. Language and Applicable Law. 3.1 The language of the Contract and the law that shall govern it shall be stipulated in the CEC. 4. Decisions of the Works Manager 4.1 Unless otherwise specifically stated, the Works Manager, on behalf of the Contracting Party, shall decide on contractual matters that arise between the Contracting Party and the Contractor. 5. Delegation of Functions. 5.1 The Works Manager, after notifying the Contractor, may delegate to other persons, with the exception of the Conciliator, any of his duties and responsibilities and may also cancel any delegation of functions after notifying the Contractor. 6. Communications. 6.1 Communications exchanged between the parties to which reference is made in the Conditions of the Contract shall only be valid when formalized in writing. Notifications shall enter into force once they are delivered. 7. Subcontracts. 7.1 The Contractor may subcontract work if it has the approval of the Works Manager, but may not assign the Contract without written approval of the Contracting Party. Subcontracting shall not alter the obligations of the Contractor. 8. Other Contractors. 8.1 The Contractor shall cooperate and share the Works Site with other contractors, public authorities, public utility companies and Contracting Parties on the dates indicated in the List of Other Contractors indicated in the CEC. The Contracting Party may modify the List of Other Contractors and shall notify the Contractor accordingly. 9. Personnel. 9.1 The Contractor shall employ key personnel enumerated in the List of Key Personnel, in accordance with what is indicated in the CEC, to carry out the functions specified in the List, or other personnel approved by the Works Manager. The Works Manager shall assess whether the classification, skills, training, capacity and experience of the proposed personnel are equal to or superior to that of the personnel listed. 9.2 If the Works Manager requests that the Contractor remove a member of the Contractor's workforce, indicating the reasons for the request, the Contractor shall ensure that such person leaves the Works Site within seven (7) following days and has no other participation in work related to the Contract. 10. Risks of the Contracting Party and the Contractor. 10.1 Risks of the Contracting Party are those that in this Contract are stipulated to correspond to the Contracting Party, and risks of the Contractor are those that this Contract stipulates correspond to the Contractor. 11. Risks of the Contracting Party. 11.1 From the date of Initiation of the Works until the date of issuance of the Certificate of Corrections of Defects, the following are risks of the Contracting Party: (a) The loss of personal injury, death, or loss or damage to property (not including Works, Plant, Materials and Equipment) as a consequence of: (i) The occupation of the Works Site by the Works, or for the purpose of carrying out the Works, as an inevitable result of the Works, or (ii) negligence, violation of duties established by law, or interference with legal rights by the Contracting Party or any person employed by it or contracted by the Contractor, except the Contractor. (b) The risk of damage to the Works, Plant, Materials and Equipment, to the extent that the damage is due to failures of the Contracting Party or in the design done by the Contracting Party, or to a war or radioactive contamination that directly affects the country where the Works are to be developed. 11.2 From the Completion Date until the date of issuance of the Certificate of Correction of Defects, the following shall be risks of the Contracting Party: loss and damage to the Works, Plant and Materials, except for loss or damage as a consequence of: (a) a Defect that existed on the Completion Date; (b) an event that occurred before the Completion Date, and that did not constitute a risk of the Contracting Party; or (c) the activities of the Contractor at the Works Site after the Completion Date. 12. Risks of the Contractor. 12.1 From the date of Initiation of the Works until the date of issuance of the Certificate of Correction of Defects, when the risks of personal injury, death and loss or damage to property (including, without limitation, Works, Plant, Materials and Equipment) are not risks of the Contracting Party, they shall be risks of the Contractor. 13. Insurance. 1.3.1 The Contractor shall contract insurance issued in the joint name of the Contractor and the Contracting Party, to cover the period between the Start Date and the expiration of the Period of Responsibility for Defects, for the total months and deductible amounts stipulated in the CEC, the following insured events risks of the Contractor: (

      • a)

        loss or damage to the Works, Plant and Materials; (

      • b)

        loss or damage to Equipment; (

      • c)

        loss or damage to property (not including Works, Plant, Materials and Equipment) related to the Contract; and, (

      • d)

        personal injury or death. 13.2 The Contractor shall deliver to the Works Manager, for approval, the insurance policies and certificates before the Start Date. Such insurance shall provide: indemnifications payable in the types and proportions of currencies recommended to rectify loss or damage and consequential damages. 13.3 If the Contractor does not provide the required policies and certificates, the Contracting Party may contract the insurance whose policies and certificates the Contractor should have administered and may recover the premiums paid by the Contractor, or if nothing is owed to it, consider them as a debt of the Contractor. 13.4 The conditions of the insurance shall not be modified if the approval of the Works Manager. 13.5 Both parties shall comply with all conditions of the insurance policies. 14. Site Investigation Reports of the Works. 14.1 The Contractor, when preparing its Offer, shall base itself on the site investigation reports of the Works indicated in the CEC, in addition to any other information available. Offerors. 15. Inquiries about the Special Conditions of the Contract. 15.1 The Works Manager shall respond to inquiries about the CEC. 16. Construction of the Works by the Contractor. 16.1 The Contractor shall construct and install the Works in accordance with the Specifications and Plans. 17. Completion of the Works on the Scheduled Date. 17.1 The Contractor may begin construction of the Works on the Start Date and shall adhere to the Programming that it had presented, with the updates that the Works Manager had approved, and complete them on the Scheduled Completion Date. 18. Approval by the Works Manager. 18.1 The Contractor shall provide the Works Manager with the Specifications and plans showing the proposed temporary works, which it shall approve if such works comply with the Specifications and Plans. 18.2 The Contractor shall be responsible for the design of the temporary works. 18.3 The approval of the Works Manager shall not relieve the Contractor of responsibility regarding the design of the temporary works. 18.4 The Contractor shall obtain approvals of the design of temporary works from third parties when necessary. 18.5 All plans prepared by the Contractor for the execution of temporary or permanent works shall be approved in advance by the Works Manager before their use. 19. Safety. 19.1 The Contractor shall be responsible for the safety of all activities at the Works Site. 19.2 The discovery of an element of great value that is unexpectedly discovered in the works area shall be the property of the Contracting Party. The Contractor shall notify the Works Manager of the discovery and follow his instructions regarding how to proceed. 21. Taking Possession of the Works Site. 21.1 The Contracting Party shall transfer to the Contractor the possession of the entire Works Site. If possession of some part of this Works Site is not transferred, if possession of some part of this Works Site is not transferred, if possession of some part of the Works Site is not transferred or if work related to the Contract is not being performed or is not foreseen to be performed. 23. Instructions, Inspections and Audits. 23.1 The Contractor shall comply with the instructions of the Works Manager that conform to the applicable law at the Works Site. 23.2 The Contractor shall allow the Bank to inspect the accounts, accounting records and files related to the submission of offers and the execution of the contract and to conduct audits through auditors designated by the Bank, if so required by the Bank. For these purposes, the Contractor shall preserve all documents and records related to the project financed by the Bank for a period of five (5) years after completion of the work. Likewise, it shall deliver to the Bank any document necessary for the relevant investigation into complaints of fraud and corruption and shall instruct the individuals, employees or agents of the Contractor who have knowledge of the project financed by the Bank to respond to inquiries from Bank personnel. 24. Disputes. 24.1 If the Contractor considers that the Works Manager has made a decision that is outside the powers conferred by the Contract, or that is not correct, the decision shall be submitted to the Conciliator within 14 days following the notification of the Works Manager's decision. 25. Procedures for the Resolution of Disputes. 25.1 The Conciliator shall communicate his decision in writing within 28 days following receipt of the notification of the dispute. 25.2 The Conciliator shall be compensated for work, whatever his decision, on an hourly basis in accordance with the fees specified in the DDL and in the CEC, plus any other foreseeable expense indicated in the CEC and the cost shall be borne equally by the Contracting Party and the Contractor. Either party may submit the Conciliator's decision to arbitration within 28 days following the written decision of the Conciliator. If neither party submits the dispute to arbitration within the 28-day period mentioned, the Conciliator's decision shall be final and binding. 25.3 Arbitration shall be conducted in accordance with the arbitration procedure published by the institution named in the CEC, and at the place established in the CEC. 26. Replacement of the Conciliator. 26.1 In case of resignation or death of the Conciliator, or in case the Contracting Party and the Contractor agree that the Conciliator is not performing his functions in accordance with the provisions of the Contract, the Contracting Party and the Contractor shall jointly appoint a new Conciliator. If after thirty (30) days the Contracting Party and the Contractor have not reached an agreement, at the request of either party, the Conciliator shall be designated by the Nominating Authority stipulated in the CEC within fourteen (14) days following receipt of the request. B. Deadline Control 27. Program. 27.1 Within the period established in the CEC after the Date of Acceptance, the Contractor shall present to the Works Manager, for approval, a Program containing the general methodologies, location, essence and execution schedule of all activities related to the Works. 27.2 The updated Program shall be one that reflects the actual progress achieved in each activity and the effects of such progress on the execution schedule of the remaining activities. 27.3 The Contractor shall present to the Works Manager for approval a Program at equal intervals not exceeding the period established in the CGC. If the Contractor does not present such updated Program within this period, the Works Manager may retain the amount specified in the CEC from the next payment certificate or next certified payment and continue retaining such amount until payment on the date on which the Contractor has presented the delayed Program. 27.4 The approval of the Program by the Works Manager shall in no way modify the obligations of the Contracting Party. The Contractor may modify the Program and present it again to the Works Manager at any time. The modified Program shall reflect the effects of Variations and Compensable Events. 28. Extension of the Scheduled Completion Date. 28.1 The Works Manager shall extend the Scheduled Completion Date when a Compensable Event occurs or a Variation is ordered that makes it impossible to complete the Works on the Scheduled Completion Date without the Contractor taking measures to accelerate the execution time of the pending work and that generates additional expenses. 28.2 The Works Manager shall determine whether the Scheduled Completion Date should be extended and for how long, within twenty-one (21) days following the date on which the Contractor requests the Works Manager to make a decision on the effects of the Variation or a Compensable Event and provides the substantiated information. If the Contractor had not given timely notice of a delay or had not communicated so that the delay is resolved due to failure, it shall not be considered in determining the new Scheduled Completion Date. 29. Acceleration of the Works. 29.1 When the Contracting Party wants the Contractor to complete the Works before the Scheduled Completion Date, the Works Manager shall request from the Contractor valued proposals to achieve the necessary acceleration of the execution of the work. If the Contracting Party accepts such proposals, the Scheduled Completion Date shall be modified and rectified by the Contracting Party and the Contractor. 29.2 If the Contractor's priced proposals to accelerate the execution of the work are accepted by the Contracting Party, such proposals shall be treated as Variations and the prices thereof shall be incorporated into the Contract Price. 30. Delays Ordered by the Works Manager. 30.1 The Works Manager may order the Contractor to delay the initiation or progress of any activity comprised in the Works. 31. Administrative Meetings. 31.1 Both the Works Manager and the Contractor may request that the other party attend administrative meetings. The purpose of such meetings shall be the review of the scheduling of pending work and the resolution of matters raised in accordance with the Early Warning procedure described in Clause 32. 31.2 The Works Manager shall keep a record of the administrative meetings and supply copies thereof to the attendees and to the Contracting Party. Either at the meeting itself or subsequently, the Works Manager shall decide and communicate in writing to the attendees the decision of the Conciliator. 32. Early Warning. 32.1 The Contractor shall warn the Works Manager as soon as possible about future events or specific circumstances that may impair the quality of the work, raise the Contract Price or delay the execution of the Works. The Works Manager shall subsequently request the Contractor to present an estimate as soon as is reasonably possible. 32.2 The Contractor shall collaborate with the Works Manager in the preparation and consideration of possible ways in which any participation in the work could or reduce the effects of such event or circumstance and execute the instructions that the Works Manager consequently orders. 33. Identification of Defects. 33.1 The Works Manager shall monitor the Contractor's work and notify of any defects found. Such monitoring shall in no way modify the obligations of the Contractor. The Works Manager may order the Contractor to locate a defect and to expose it or submit to test any work that the Works Manager considers could have some defect. 34. Tests. 34.1 If the Works Manager orders the Contractor to perform some test that is not contemplated in the Specifications in order to verify if some work has defects and the test reveals that it does not, the Contractor shall pay the cost of the test and of the samples. If no defect is found, the test shall be considered a Compensable Event. 35. Corrections of Defects. 35.1 The Works Manager shall notify the Contractor of all defects of which it becomes aware before the expiration of the Period of Responsibility for Defects, which begins on the date of completion and is defined in the CEC. The Period of Responsibility for Defects shall be extended for as long as defects remain to be corrected. 35.2 Each time a defect is notified, the Contractor shall correct it within the time period specified in the notification from the Works Manager. 36. Uncorrected Defects. 36.1 If the Contractor has not corrected a defect within the time period specified in the notification from the Works Manager, the latter shall estimate the cost of correcting the defect, and the Contractor shall pay such amount. D. Cost Control. 37. Bill of Quantities. 37.1 The Bill of Quantities shall contain the line items corresponding to Construction, assembly, tests and commissioning work to be performed by the Contractor. 37.2 The Bill of Quantities is used to calculate the Contract Price. The Contractor is paid for the quantity of work performed at the unit price specified for each line item in the Bill of Quantities. 38. Modifications in Quantities. 38.1 If the final quantity of work performed differs by more than twenty-five (25%) percent from that specified in the Bill of Quantities for a particular line item, and provided that the difference exceeds one (1%) percent of the Initial Contract Price, the Works Manager shall adjust the prices to reflect the change. 38.2 The Works Manager shall not adjust prices due to differences in quantities if doing so would exceed the Initial Contract Price by more than fifteen (15%) percent, unless it has prior approval from the Contracting Party. 38.3 If the Works Manager so requests, the Contractor shall provide a breakdown of costs corresponding to any price shown in the Bill of Quantities. 39. Variations. 39.1 All Variations shall be included in the updated Programs presented by the Contractor. 40. Payments for Variations. 40.1 When the Works Manager so requests, the Contractor shall submit a quotation for the execution of the Variation. The Contractor shall provide it within seven (7) days following the request, or within a longer period if the Works Manager so determined. The Works Manager shall analyze the quotation before ordering the Variation. 40.2 When the work corresponds to line items described in the Bill of Quantities and if, in the opinion of the Works Manager, the quantity of work or its execution schedule does not produce changes in the unit cost above the limit established in Subclause 38.1, the price indicated in the Bill of Quantities shall be used to calculate the value of the Variation. If the unit cost is modified, or if the nature or execution schedule of the work corresponding to the Variation does not match any price indicated in the Bill of Quantities, the Contractor shall provide a quotation with new prices for the relevant line items of the work. 40.3 If the Works Manager does not consider the Contractor's quotation probable, the Works Manager may prepare its own estimate and adjust the Contract Price based on its own estimate of the effects of the Variation on the Contractor's costs. 40.4 If the Works Manager decides that the urgency of the Variation does not allow obtaining and analyzing a quotation without delaying the work, no quotation shall be requested and the Variation shall be considered a Compensable Event. 40.5 The Contractor shall have no right to payment of any compensation to the extent that the interests of the Contracting Party are harmed if the Contractor had not cooperated with the Works Manager. 45. Taxes. 45.1 The Works Manager shall adjust the Contract Price if taxes, duties and other levies change in the period between the date that is twenty-eight (28) days prior to the date of submission of the Offers for the Contract and the date of the last Completion Certificate. The adjustment shall be made by the amount of changes in taxes payable by the Contractor, provided that such changes are not in the relationship in the Contract Price, or are the result of the application of clause 47 of the CGC. 46. Currencies. 46.1 When payments are to be made in currencies different from that of the Contracting Party's country stipulated in the CEC, the exchange rates to be used to calculate the sums payable shall be those stipulated in the Offer and in accordance with the amount of work executed. SOPTRAVI, through its Environmental Unit, shall provide the necessary cooperation to whoever has the property and/or use of the resource. The Contractor shall obtain at its own cost the licenses, permits, etc., that were required by laws, decrees or regulations of the Republic of Honduras or of the Municipalities that have jurisdiction in the work. When the Contractor considers it convenient and necessary for the benefit of the project, to use borrow pits for the exploitation of materials other than those proposed by the Contracting Party, it shall take the following into account: The borrow pit shall be concessioned. It shall warn or communicate to the Contracting Party through its offer the use of a new borrow pit. Define in its offer the borrow pits. The materials from the borrow pits shall comply with the technical specifications required corresponding to each of the activities in which they will be used. CGC 17.1 The Contractor must initiate work as indicated in subclause 1.1 (z) of these CEC. CGC 19 The following is added to this Clause: 1. Notices and Publications.- Because the roadway on which the project will be carried out is the most important in the country considering that a high volume of vehicles circulates on it, with a considerable percentage of freight transport traffic, around forty (40%) percent, it is necessary to inform, guide and warn users about the work being performed and about the current conditions of the project, with the purpose of providing safety to the population surrounding the project, and in particular to users of the roadway. In that sense, the General Directorate of Highways has deemed it appropriate and necessary that the Contractor be responsible for making periodic publications and that the cost be considered by the offerors within the unit prices of the activities in their offer, taking into account the means of publication, type of publication and the following frequency: [√] Notices or publications shall be made in two printed periods of greater national circulation, one in San Pedro Sula and another in Tegucigalpa. [√] The legend shall be drafted by supervision and approved by the DGC. [√] The printing area shall be one quarter of an interior page, in black and white. [√] Publications shall be made once per week, on Monday or Tuesday, during the contract period of the project or while the works are being executed. [√] In the event it is necessary to make some publication(s) written in an area larger than the one indicated above, the equivalence shall be made between the number of weekly publications of a quarter vs. the publication larger than a quarter. Likewise, verbal publications may be made through Radio Stations of the country, whose payments shall be estimated in equivalents. (Example: One page = 1/4 of page x 4) 2. Safety and Hygiene Plan.- In the execution of this Contract, the Contractor shall comply with the National Laws of Honduras related to safety, health and sanitation. For this and as a prior condition to the payment of the first portion of the advance and to the start of work, the Contractor shall prepare a safety plan applicable to all activities and for the entire project execution process. Said plan shall be reviewed by the Supervisor and approved by the Contracting Party, in which it shall consider the strategy for the implementation and monitoring of protection measures, safety devices and protective equipment and shall take all measures that it deems as reasonably necessary, for the safety and health of both the Contractor's personnel, as well as of pedestrians and vehicles circulating in the vicinity or surroundings of the project during the construction period. The Contractor shall have ten (10) days to implement the measures once said safety plan is approved, if within that time they have not been implemented or if during the review of the implementation said plan, supervision notifies it of the need to improve some measure already provided in the plan and the Contractor does not do so within a maximum of ten (10) days, for non-compliance with what is provided in this Literal, it shall give rise for the Government to deduct as a fine the amount of FIFTY THOUSAND LEMPIRAS (L.50,000.00) for each month in which it fails to comply with the requirement of DGC - GGPE supervision regarding what was indicated above, which shall be applied directly deductible from the value corresponding to the payment of the nearest work estimate and shall apply the corresponding fine without prejudice to the execution of the advance guarantee given by the Contractor if the value of the nearest estimate is insufficient. The fine applies in the same manner, in the case of delays of more than three (3) calendar days with respect to the scheduled dates for the incorporation of resources and inputs to the project. Additionally, if the Contractor fails to comply with the Mobilization Program to the Project and Advance Investment Plan, the second portion of the advance shall not be delivered until it complies with the conditions of the first portion. CGC 51.3 In the final or penultimate estimate, the balance of the advance paid to the Contractor that remained pending shall be deducted. CGC 52.1 The amount of the Contract guarantee shall be 15% (fifteen percent) of the total contract and shall have a validity of (3) three months longer than the contract execution time. In case of extension of the contract time by more than (1) one month, the validity of the guarantee shall be extended to ninety (90) days after the new scheduled completion date. The deadline for presentation of this guarantee shall be no later than ten (10) business days after the signing of the contract or another date indicated by the Contracting Party. CGC 53. Day Work or Delegated Administration: The Contractor shall make available to the Works Director, when requested, the equipment, personnel, supplies and materials that are requested to perform accessory work or enterprises, to those included in the Contract. Furthermore, when the need for work arises whose unit price is not contemplated in the Contract, Supervision and the Contractor with the approval of the Director shall agree on the unit prices corresponding to these works, through the procedure described in Clause CGC 40 of these CEC; if an agreement is not reached, the work shall be done by Delegated Administration. General item here applies the rule. 1. When there are funds available in the respective budget item, any work to be paid by the Delegated Administration line item shall be ordered by Supervision with the authorization of the Director, through the issuance of a Work Order to the Contractor with simultaneous copy to Supervision. The Contractor: The Contractor is subject to the penalty established in the contract. Furthermore, if the total investment executed decreases by more than fifteen (15%) percent with respect to the programmed investment, the Director shall order the deduction of the balance of the advance delivered in the nearest work estimate and shall apply the corresponding fine without prejudice to the execution of the advance guarantee presented by the Contractor if the value of the nearest estimate is insufficient. The fine applies also in the same manner, in the case of delays of more than three (3) calendar days with respect to the scheduled dates for the incorporation of resources and inputs to the project. Additionally, if the Contractor fails to comply with the Mobilization Program to the Project and Advance Investment Plan, the second portion of the advance shall not be delivered until it complies with the conditions of the first portion. CGC 51.3 In the final or penultimate estimate, the balance of the advance paid to the Contractor that remained pending shall be deducted. CGC 52.1 The amount of the Contract guarantee shall be 15% (fifteen percent) of the total contract and shall have a validity of (3) three months longer than the contract execution time. In case of extension of the contract time by more than (1) one month, the validity of the guarantee shall be extended to ninety (90) days after the new scheduled completion date. The deadline for presentation of this guarantee shall be no later than ten (10) business days after the signing of the contract or another date indicated by the Contracting Party. CGC 53. Day Work or Delegated Administration: The Contractor shall make available to the Works Director, when requested, the equipment, personnel, supplies and materials that are requested to perform accessory work or enterprises, to those included in the Contract. Furthermore, when the need for work arises whose unit price is not contemplated in the Contract, Supervision and the Contractor with the approval of the Director shall agree on the unit prices corresponding to these works, through the procedure described in Clause CGC 40 of these CEC; if an agreement is not reached, the work shall be done by Delegated Administration. General item here applies the rule. 1. When there are funds available in the respective budget item, any work to be paid by the Delegated Administration line item shall be ordered by Supervision with the authorization of the Director, through the issuance of a Work Order to the Contractor with simultaneous copy to Supervision. The Contractor shall be responsible for repairing and paying at its own expense for any losses or damages suffered by the Works or Materials to be incorporated therein between the Date of Initiation of the Works and the expiration of the Period of Responsibility for Defects, when such losses and damages are caused by its own acts or omissions. E. Completion of the Contract. 55. Completion of the Works. 55.1 The Contractor shall request the Works Manager to issue a Certificate of Completion of the Works and the Works Manager shall issue it when it decides that the Works are complete. 56. Acceptance of the Works. 56.1 The Contracting Party shall take possession of the Works Site and of the Works within seven (7) days following the date on which the Works Manager issues the Certificate of Completion of the Works. 57. Final Settlement. 57.1 The Contractor shall provide the Works Manager with a detailed statement of the total amount that the Contractor considers is owed to it under the Contract before the expiration of the Period of Responsibility for Defects. The Works Manager shall issue a Certificate of Responsibility for Defects and shall certify any final payment owed to the Contractor within fifty-six (56)...

This Decree shall enter into force as of the day of its publication in the Official Gazette La Gaceta. Given in the city of Tegucigalpa, municipality of the Central District, in the Session Hall of the National Congress, on the twenty-first day of the month of July of two thousand nine. JOSÉ ALFREDO SAAVEDRA PAZ PRESIDENT CARLOS ALFREDO LARA WATSON SECRETARY GONZALO ANTONIO RIVERA SECRETARY To the Executive Branch. Therefore: Execute. Tegucigalpa, M.D.C., of 2009. ROBERTO MICHELETTI BAÍN CONSTITUTIONAL PRESIDENT OF THE REPUBLIC THE SECRETARY OF STATE IN THE OFFICES OF PUBLIC WORKS, TRANSPORTATION AND HOUSING (SOPTRAVI). Sanctioned in accordance with what is established in the second paragraph of Article 216 of the Constitution of the Republic.