CONSTRUCTION AGREEMENT

This AGREEMENT made this ___ day of __________ 2020 at _________by and between:

_______________________ a corporation duly organized and existing under Philippine laws with
office address at ___________________________, represented herein by its President/CEO ,
_______________ , hereafter called the OWNER.

-and-

____________________________, a corporation duly organized and existing under Philippine laws with
office address at _______________________________________________________, represented by its
President and CEO ________________________, hereafter called the CONTRACTOR,

Collectively referred to as the PARTIES.

WHEREAS, the OWNER needs the services of a qualified and competent contractor to do interior
renovation/improvement works at its aforesaid office address and the CONTRACTOR represents that it meets the
requirements of the OWNER,

NOW, therefore the parties hereby enter into this CONSTRUCTION AGREEMENT (the Agreement) with the
following provisions, terms and conditions:

THE PROJECT/WORK:

The subject of this Agreement is the interior renovation/improvement of OWNER’s office located at
__________________________________, based on the construction plans submitted and approved by OWNER.

ARTICLE 1

THE CONTRACT DOCUMENTS

1.1 The Contract Documents that form part of this Agreement are the Construction Plans (Appendix “A”) and the
Detailed Construction Cost Breakdown (Appendix “B”), all approved by the OWNER.

1.2 It is understood that the term “Contract” as used herein refers to the Contract Documents while the term
“Agreement” includes this Construction Agreement and the Contract Documents.

1.3 This Agreement represents the entire and integrated agreement between the parties hereto and supersedes prior
negotiations, representations or agreements, either written or oral.

ARTICLE 2

THE WORK OF THIS CONTRACT (See Appendices A and B)

2.1 The Contractor shall execute the entire Work described in the Contract Documents, except for work not indicated
in the Cost Breakdown or other Contract under the responsibility of others.

2.2 Costs of materials as enumerated and required in the Cost Breakdown and Materials Specifications are all
included in this Contract.

2.3 Cost of Labor to complete the construction and installation in the highest acceptable quality of all items found in
Paragraph 2.2 are also included.

2.4 Other costs including tools, equipment, transportation, and other incidental cost to complete Paragraph 2.2 and 2.3
are incorporated in the Contract.

2.5 The contractor will provide preconstruction services to come up with the schematic designs, preliminary drawings,
final drawings, materials specifications, cost estimates, construction schedule, building permit assistance, all signed
and sealed by respective trade professionals. Costs thereof are included in Paragraph 2.2
ARTICLE 3

DATE OF COMMENCEMENT AND COMPLETION

3.1 The date of commencement is the date from which the Owner remits the full construction down payment to the
Contractor, or it shall be the date of this Agreement, as first written above, or upon receipt of the Notice-to-Proceed
from Owner, whichever comes later.

3.2 The Contractor shall diligently proceed with the Project and make all reasonable efforts to complete it within a
period of 120 days exclusive of Sundays and holidays from the commencement of the work, unless prevented by
fortuitous events and/or factors attributable to the Owner, in which case the Contractor may extend the period of
completion for a reasonable time upon written notice to the Owner.

ARTICLE 4

CONTRACT SUM, DOWNPAYMENT, PRECONSTRUCTION FEE AND PROGRESS PAYMENTS

4.1 The Owner shall pay the Contractor in current funds for the Contractor's performance of the Contract the total
sum of
PHILIPPINE PESOS:

SCHEDULE OF PAYMENTS

4.2a The down payment for the preparation of technical plans to be prepared and signed by respective professionals
and documentation is equivalent to PHILIPPINE PESOS:

4.2b The down payment for the work to be paid upon approval and release of the Notice to Proceed (NTP) from
building admin and from the owner is equivalent to PHILIPPINE PESOS: __________________or 30% of the
contract amount.

PROGRESS PAYMENTS:

4.3 Based upon the weighted percentage progress of the works, a Progress Accomplishment Billing will be submitted
to the Owner by the Contractor, and the Owner shall make progress payments on account of the Contract Sum to the
Contractor.

4.4 Provided there is no question on the Progress Accomplishment received by the Owner or thru authorized
representative in person or thru email, Owner shall make payment to the Contractor within seven (7) working days
from receipt thereof or from the resolution of any question on the Progress Accomplishment Billing.

4.5 With each Progress Accomplishment Billing, the Contractor shall submit pictures or evidence required by the
Owner or upon inspection of the Project Consultant (Owner side) to substantiate the actual progress of the Project.

4.6 Failure to make any Payment after it becomes payable by the Owner shall entitle the Contractor to cease all work
until the Payment has been made. If the Payment has not been made within 7 (seven) working days of any
undisputed billing statement given to the Owner by the Contractor, the Contractor may elect to treat such non-
payment as either repudiation of the Agreement or a fundamental breach of the Agreement. The Contractor must
notify the Owner of its election and if payment still remains unpaid at the expiration of THREE (3) days after
notification of the Contractor’s election, the Contractor may serve notice on the Owner that the Contractor’s
engagement under this Agreement is terminated.

4.7 The following amounts will be deducted from the Progress Billing by the OWNER:

4.7.1 Ten percent (10%) retention; and,

FINAL PAYMENT
4.8 Final payment and retention is equivalent to TEN PERCENT (10%) of the Contract Price payable 30 days after
concurrence of the following: (1) issuance of a Project Completion Report by the Contractor, (2) release of all
certificates of approval from concerned authority as applicable, (3) full acceptance by the Owner of the Project, (4)
submission of notarized certification by Contractor stating that all the wages, salaries and benefits of the involved
workers in the project have been paid and that all the creditors of the Contractor who supplied the construction
materials and equipment have likewise been paid; and (5) posting and submission of a Guarantee/Warranty Bond
equivalent to five percent (5%) of the total contract amount with a validity period of one year from date of formal
acceptance of the WORK to answer for defects and warranties of the Contractor;

ARTICLE 5

ACCELERATION AND COST PLUS

5.1 If the working days available to the Contractor, between the Commencement Date and the Completion Date are
reduced by one or more weeks through no fault of the Contractor, the Contract Sum will not increase or decrease.
Any additional or changes in some portion of works for labor and materials not stated in the original scope of works
will be added at the total project cost and it will be “labelled change order” or “cost plus”.

*Written request from the owner must be submitted to the contractor for taking additional works or change of orders.

ARTICLE 6

SUBCONTRACTS AND OTHER AGREEMENTS

6.1 This portion of the Work that the Contractor does not customarily perform with the Contractor's own personnel
shall be performed under subcontracts or by other appropriate agreements with the Contractor. The Contractor shall
not be required to contract with anyone to whom the Owner has reasonable objection.

ARTICLE 7

MISCELLANEOUS PROVISIONS

7.1 Any payments due and unpaid under the Contract shall bear monthly interest from the date payment is due at the
rate of 1% monthly compounded interest.

7.2 Delay in payments and Owner Supplied Materials shall be considered time extension of the Contract equivalent
to the number of days delayed by these supplies and payments.

7.3 The work may not be terminated by the Owner without due cause.

7.4 The CONTRACTOR shall secure and obtain a CONTRACTOR’S ALL RISK (CAR) Comprehensive Insurance
Policy equivalent to one hundred percent (100%) of the contract price from the date of commencement mentioned in
Article 3.1 valid until the Works have been completed. The Contractor expressly guarantees that Workman’s
Compensation is paid up and complied with. The Contractor shall also secure Performance/Surety Bond in favor of
the OWNER upon commencement of this Agreement to guarantee payment in case of non-fulfillment of the work.
The premiums thereof are deemed included under the Indirect Cost of Appendix “B”. The Insurance Policy and the
Performance/Surety Bond and the corresponding official receipts shall be surrendered by the Contractor to the
Owner upon release of the down-payment.

7.5 The warranty in workmanship is one (1) year after the turn-over applies.

7.6 All other provisions embodied in the Contract between the OWNER and the CONTRACTOR is made in integral
parts of this Agreement.

7.7 The CONTRACTOR shall keep, save and hold the Owner, its directors, owners, representatives and employees
free and harmless from any and all demands for employees’ wages and salaries and other monetary claims for labor,
including any and all claims by third parties injured or damaged by the Contractor in the execution of the Project.
ARTICLE 8

EXTENSIONS OF TIME

8.1 Should the progress of the Works be delayed by a cause beyond the control of the Contractor, including provision
of the critical dimensions of the site by the Owner, the Completion Date shall be extended.

8.2 The Contractor shall notify the Owner of any delays where an extension of time is sought within a reasonable
time of the occurrence of the delay and with the notification, state the period for which extension of the Completion
Date is sought. Should the Unit Owner not object in writing within 5 days of the giving of the notice then the
Completion Date is deemed to be extended to the date set out in the notice.

ARTICLE 9

LIQUIDATED DAMAGE

9.1 If the Contractor fails to satisfactorily deliver any or all of the works and/or to perform the Services within the
period(s) specified in this Contract inclusive of duly granted time extensions if any, the Procuring Entity shall, without
prejudice to its other remedies under this Contract and under the applicable law, deduct from the Contract Price, as
liquidated damages, the applicable rate of one tenth (1/10) of one percent (1%) of the cost of the unperformed portion
for every day of delay until actual delivery or performance. The maximum deduction shall be ten percent (10%) of the
amount of contract. Once the maximum is reached the contract will be terminated.

ARTICLE 10

ARBITRATION

10.1 In case of dispute arising from this Agreement, the parties themselves shall exert earnest  efforts to settle it
amicably. In case of failure and resort to court is necessary, the venue shall be limited to the competent court in the
City of (Name of City) , Metro Manila. 

IN WITNESS WHEREOF, the parties have hereunto set their hands at the place and date first written
above.

CONTRACTOR OWNER

____________________________ ________________________
Witness Witness
ACKNOWLEDGEMENT

REPUBLIC OF THE PHILIPPINES]

Before me, a Notary Public for and in _____________________, this _____day of _________, personally
appeared the following:

Name TYPE OF ID / ID NUMBER

1.

2.

known to me to be the same persons who executed the foregoing Construction Agreement composed of ____ (_)
pages including the page where this acknowledgement is written and acknowledged the same to be their voluntary
act and deed and that of the Corporations being represented.

Doc. No. _______: