CONTRACT NO. 2014-10SUPPLY OF DRINKING WATER WITH HOT AND COLD WATER DISPENSER FOR

CY2014

THIS CONTRACT made and entered into by and between the following:

DEPARTMENT OF BUDGET AND MANAGEMENT, a government agencycreated by ,virtue of the laws of the Republic of the Philippines, with principal officeaddress at Mabini Hall, Malacafiang, Manila, represented herein by its Secretary,FLORENCIO B. ABAD, hereinafter called the "DBM";

- and-

WATER FOR LESS PURIFICATION SYSTEM"PACO BRANCa, acompany duly organized and existing under the laws of the Philippines, withprincipal office located at I370-B Garden Plaza Hotel, General Luna Street, Paco,Manila represented herein by JOYCE SJ. SEMILLA (hereinafter called the"Supplier");

WITNESSETH:

WHEREAS, the DBM conducted a negotiated procurement for the "Supply of Drinking Waterwith Hot and Cold Water Dispenser for CY 2014" (hereinafter, the "Goods and Services") andthe bid of the Supplier in the total amount Two Hundred Sixty Five Thousand Six HundredEighty Pesos (P265,680.00) (hereinafter called the "Contract Price");

WHEREAS, the Notice of Award was issued to the Supplier on March 31, 2014 and theSupplier posted its performance security on April 1,2014.

NOW, THEREFORE, for and in consideration of the foregoing premises, the parties herebymutually stipulate and agree as follows:

2. The following documents shall form and be read and construed as part of this Contract:

I. In this Contract, words and expressions shall have the same meanings as are respectivelyassigned to them in the General and Special Conditions of Contract referred to in AnnexD and E, respectively.

Annex ABCDEFG

Bid Form and Price Schedule;Schedule of Requirements;Technical Specifications;General Conditions of Contract;Special Conditions of Contract;Notice of Award; andPerformance Security.

3. In consideration of the payments to be made by the DBM to the Supplier, the Supplierhereby covenants with the DBM to provide the Goods and Services and to remedydefects therein in conformity with the provisions of the Contract.

4. The DBM hereby covenants to pay the Supplier, in consideration of the provision of theGoods and Services and the remedying of defects therein, the Contract Price or suchother sum as may become payable under the provisions of the contract at the time and inthe manner prescribed by the Contract.

WATER FOR LESSPURlFICA nON SYSTEM-PACOBRANCHBy:

IN WIlNESS WHEREOF, the parties hereto have signed this Contract on this _,_ day ofIf '2014 at Malacanang, Manila, Philippines.I 1 API?

DEPARTMENT &UfiJDGETAND MANAGEMENT

By:

,;;' ;

FLORENCIO B. ABADSecretary

JOYCE J. SEMILLAPropriet r

SIGNED IN THE PRESENCE OF

SOlYJ.~TO'Dirlt~r, Administrative Service

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ACKNOWLEDGMENT

REPUBLIC OF THE PHILIPPINES )CIT Y 0 F MAN \ LA) 8.S.

BEFORE ME, a Notary Public for and in the City of Manila, Philippines, personally appearedthe following

NAME

FLORENCIO B. ABAD

JOYCE SJ. SEMILLA

VALIDID

DBM ID No. 3706

Driver's License No.N02-01-456919

VALID UNTIL

2014

known to me to be the same persons who executed the foregoing Contract and whoacknowledged to me that the same is their free and voluntary act and deed and of the entities theyrespectively represent.

This Contract for the Supply ofDrinkirig Water with Hot and Cold Water Dispenser for CY 2014was signed by the parties, and signed/initialed by their material witnesses on each and every pagethereof.

WITNESS MY HAND AND SEAL this _ day ofO 1 APR 2014-, 2014.

DOC.NO.o/fpageNo.~Book No.Series of .

, A • ENDlV11.NOTARY UBLIC

ADM. MATTER NO. NP- 038UNTIL DECEMBER31.2014IBP NO.S98088/SC NO.10989PTRNO.7011377/ 01-02-13/ QC

AnnexAFinancial Proposal Form

Date: March 12, 2014

ATTY, JANET B. ABUELChairpersonDBM-Bids and Awards CommitteeDepartment of Budget and ManagementMalacanang, Manila

Gentlemen and/or Ladies:

We, the undersigned, offer to Supply of Purified Drinking Water with Hot and Cold WaterDispenser for CY 2014 in conformity with the technical specifications and schedule of requirements forthe sum of Two Hundred Sixty Five Thousand Six Hundred Eighty Pesos.

Total Contract

Weekly Qty Annual Qty RequirementCost (VAT

Requirement (Weekly quantity x 4 weeks x 12 months) Unit Cost Inclusive)

(a) (b) (c) (b x c)

205 9,840 Php 27 Php265,680

Total (VAT inclusive)

*Note: The above-quoted cost is inclusive of costs ofboUles, provision for hot and colddispensers, delivery charges and all other incidental charges.

We undertake, if our Offer is accepted, to deliver the goods in accordance with the deliveryschedule specified in the Schedule of Requirements.

We, agree to abide by'this Offer for one hundred twenty (120) calendar days and it shall remainbinding upon us and may be accepted at any time before the expiration ofthat period.. ,

If ouf Offer is accepted, we undertake to provide a performance security in the form, amounts,and within the times spec~fied in the Implementing Rules and Regulations of Republic Act No, 9184 .

.-~" . "\,,"

•,1

.-.~Until .'J.formal .Contract is prepared and executed, this Offer, together with your written

" acceptance thereot-and your Notice of Award, shall be binding upon us.,",. ,~~",-We'understand that you are not bound to accept the lowest or any Offer you may receive.

We certify/confirm that we comply with the eligibility requirements as stated in the Invitation for

Negotiated procurement.

Owner/Franchiseein the capacity of

Duly authorized to sign Bid fOTand on behalf of Water for Less Purification System - Paco Branch

Anneti3;J

Section VI. Schedule of Requirements

The delivery schedule expressed as weeks/months stipulates hereafter a delivery date which is the

date of delivery to the project site.

Item No. Description Quantity Delivery Date

1 Supply of Purified Drinking Water 205" bottles of 5 Weeklygallons Del ivery/Distribution

Of Water everySaturday

2 Hot and Cold Water Dispenser 40 units One time delivery ofHot and Cold WaterDispenser within

Fifteen (15) calendarDays from the issuanceOf Notice to Proceed

"Indicative number and for bidding purposes only.

I hereby certify to comply and deliver all the above requirements.

Water for Less Purification System-Paco BranchName of Company/Bidder

/./ ,I

Jo ce SI • SemlllaSignature Ov Printed Name of

Representative

March 12, 2014Date

AnnextiY~

Section VII. Technical Specifications

Bidders must stated either "Comply" or "Not Comply" or any equivalent term in the

column "Statement of Compliance" against each of the individual parameters of each

uSpecificationsll

Item No. Specifications Statement ofCompliance

1 Purified Drinking Water COMPLY

2 Minimum of 16 stages purification/filtration COMPLY

process3 Content: S gallons per bottle COMPLY

4 Shape and quality of bottle: Round and poly COMPLY

carbonated resin type (brand new)

S Provision for closed delivery van/truck COMPLY

6 Forty (40) units of brand new hot and coldwater dispenser with the followingspecifications

COMPLY

• Power source nov /60Hz

• Rated input power (heating): SOOW

• Rated input power (cooling): BOW

• Refrigerant/pout: R12/42g

7 Monthly cleaning of hot and cold water COMPLY

dispenserB Monthly submission of Water Test Laboratory

Certificate from DOH-accredited water COMPLY

testing laboratory

9 Monthly random sampling of water samplesshall be jointly conducted by Supplier and COMPLY

DBM and sent to water testing, laboratorycost chargeable to Supplier; and

10 Sanitary Permits for the duration of the COMPLY

contract

March 12, 2014Date

e • semillaSignature oJ r Printed Name of

Representative

Water for less Purification System-Paco BranchName of Company/Bidder

I hereby certify to comply with all the above Technical Specifications.

General Conditions of Contract1. Definitions

1.1. In this Contract, the following terms shall be interpreted as indicated:

(a) "The Contract" means the agreement entered into between the ProcuringEntity and the Supplier, as recorded in the Contract Form signed by theparties, including all attachments and appendices thereto and all documentsincorporated by reference therein.

(b) "The Contract Price" means the price payable to the Supplier under theContract for the full and proper performance of its contractual obligations.

(c) "The Goods" means all of the supplies, equipment, machinery, spare parts,other materials and/or general support services which the Supplier is requiredto provide to the Procuring Entity under the Contract.

(d) "The SerVices"means those services ancillary to the supply of the Goods,such as transportation and insurance, and any other incidental services, suchas installation, commissioning, provision oftechnical assistance, training, andother such obligations of the Supplier covered under the Contract.

(e) "GCC" means the General Conditions of Contract contained in this Section.

(f) "SCC" means the Special Conditions of Contract.

(g) "The Procuring Entity" means the organization purchasing the Goods, asnamed in the sce.

(h) "The Procuring Entity's country" is the Philippines.

(i) "The Supplier" means the individual contractor, manufacturer distributor, orfirm supplying/manufacturing the Goods and Services under this Contractand named in the sec.

G) The "Funding Source" means the organization named in the sec.(k) "The Project Site," where applicable, means the place or places named in the

sec.(I) "Day" means calendar day.

(m) The "Effective Date" of the contract will be the date of receipt by theSupplier of the Notice to Proceed or the date provided in the Notice toProceed. Performance of all obligations shall be reckoned from the EffectiveDate of the Coiltract.

(n) "Verified Report" refers to the report submitted by the Implementing Unit tothe Head of the Procuring Entity setting forth its findings as to the existenceof grounds or causes for termination and explicitly stating itsrecommendation for the issuance of a NotiCeto Terminate.

Ann{X D

2. Corrupt, Fraudulent, Collusive, and Coercive Practices

2.1. Unless otherwise provided in the sec, the Procuring Entity as well as the bidders,contractors, or suppliers shall observe the highest standard of ethics during theprocurement and execution of this Contract. In pursuance of this policy, the ProcuringEntity:

(a) defines, for the purposes of this provision, the terms set forth below asfollows:

(i) "corrupt practice" means behavior on the part of officials in thepublic or private sectors by which they improperly and unlawfullyenrich themselves, others, or induce others to do so, by misusing theposition in which they are placed, and it includes the offering, giving,receiving, or soliciting of anything of value to influence the action ofany such official in the procurement process or in contract execution;entering, on behalf of the Government, into any contract ortransaction manifestly and grossly disadvantageous to the same,whether or not the public officer profited or will profit thereby, andsimilar acts as provided in Republic Act 3019.

(ii) "fraudulent practice" means a misrepresentation of facts in order toinfluence a procurement process or the execution of a contract to thedetriment of the Procuring Entity, and includes collusive practicesamong Bidders (prior to or after bid submission) designed toestablish bid prices at artificial, non-competitive levels and to deprivethe Procuring Entity ofthe benefits of free and open competition.

(iii) "collusive practices" means a scheme or arrangement between two ormore Bidders, with or without the knowledge of the Procuring Entity,designed to establish bid prices at artificial, non-competitive levels.

(iv) "coercive practices" means harining or threatening to harm, directlyor indirectly, persons, or their property to influence their pluticipationin a procurement process, or affect the execution of a contract;

(v) "obstructive practice" is

(aa) deliberately destroying, falsifYing, altering or concealing ofevidence material to an administrative proceedings orinvestigation or making false statements to investigators inorder to materially impede an administrative proceedings orinvestigation of the Procuring Entity or any foreigngovernment/foreign or international financing institution intoallegations of a corrupt, fraudulent, coercive or collusivepractice; and/or threatening, harassing or intimidating anyparty to prevent it from disclosing its knowledge of mattersrelevant to the administrative proceedings or investigation orfrom pursuing such proceedings or investigation; or

(bb) acts intended to materially impede the exercise of theinspection and audit rights of the Procuring Entity or anyforeign government/foreign or international financinginstitution herein.

(b) will reject a proposal for award if it determines that the Bidder recommendedfor award has engaged in any of the practices mentioned in this Clause forpurposes of competing for the contract.

2.2. Further the Funding Source, Borrower or Procuring Entity, as appropriate, will seekto impose the maximum civil, administrative and/or criminal penalties availableunder the applicable law on individuals and organizations deemed to be involved withany of the practices mentioned in GCC Clause 2.1 (a).

3. Inspection and Audit by the Funding Source

The Supplier shall permit the Funding Source to inspect the Supplier's accounts and recordsrelating to the performance of the Supplier and to have them audited by auditors appointed bythe Funding Source, if so required by the Funding Source.

4. Governing Law and Language

4.1. This Contract shall be interpreted in accordance with the laws of the Republic of thePhilippines.

4.2. This Contract has been executed in the English language, which shall be the bindingand controlling language for all matters relating to the meaning or interpretation ofthis Contract. All correspondence and other documents pertaining to this Contractexchanged by the parties shall be written in English.

5. Notices

5.1. Any notice, request, or consent required or permitted to be given or made pursuant tothis Contract shall be in writing. Any such notice, request, or consent shall bedeemed to have been given or made when received by the concerned party, either inperson or through an authorized representative of the Party to whom thecommunication is addressed, or when sent by registered mail, telex, telegram, orfacsimile to such Party at the address specified in the SCC, which shall be effectivewhen delivered and duly received or on the notice's effective date, whichever is later.

5.2. A Party may change its address for notice hereunder by giving the other Party noticeof such change pursuantto the provisions listed in the SCC for GCC Clause 5.1.

6. Scope of Contract

6.1. The GOODS and Related Services to be provided shall be as specified in Section VI.Schedule of Requirements.

6.2. This Contract shall include all such items, although not specifically mentioned, thatcan be reasonably inferred as being required for its completion as if such items wereexpressly mentioned herein. Any additional requirements for the completion of thisContract shall be provided in the SCC.

7. Subcontracting

7.1. Subcontracting of any portion of the Goods, if allowed in the BDS, does not relievethe Supplier of any liability or obligation under this Contract. The Supplier will beresponsible for the acts,. defaults, and negligence of any subcontractor, its agents,servants or workmen as fully as if these were the Supplier's own acts, defaults, ornegligence, or those of its agents, servants or workmen.

7.2. Subcontractors disclosed and identified during tbe bidding may be changed during tbeimplementation of tbis Contract, subject to compliance witb tbe requiredqualifications and tbe approval oftbe Procuring Entity.

8. ProcurlngEntity's Responsibilities

8.1. Whenever the performance of tbe obligations in tbis Contract requires tbat tbeSupplier obtain permits, approvals, import, and otber licenses from local publicautborities, the Procuring Entity shall, if so needed by tbe Supplier, make its besteffort to assist tbe Supplier in complying witb such requirements in a timely andexpeditious manner.

8.2. The Procuring Entity shall pay all costs involved III tbe performance of itsresponsibilities in accordance witb GCC Clause 6.

9. Prices

9.1. For the given scope of work in tbis Contract as awarded, all bid prices are consideredfixed prices, and tberefore not subject to price escalation during contractimplementation, except under extraordinary circumstances and upon prior approval ofthe GPPB in accordance witb Section 61 of R.A. 9184 and its IRR or except asprovided in this Clause.

9.2 Prices charged by tbe Supplier for Goods delivered and/or services performed undertbis Contract shall not -varyfrom tbe prices quoted by the Supplier in its bid, witb theexception of any change in price resulting from a Change Order issued in accordancewitb GCe Clause 29.

10. Payment

10.1. Payments shall be made only upon a certification by tbe Head of tbe Procuring Entityto tbe effect that the Goods have been rendered or delivered in accordance with theterms of tbis Contract and have been duly inspected and accepted. Except witb tbeprior approval of tbe President no payment shall be made for services not yetrendered or for supplies and materials not yet delivered under this Contract. Tenpercent (10%) of tbe amount of each payment shall be retained by tbe ProcuringEntity to cover the Supplier's warranty obligations under this Contract as described inGCC Clause 17.

10.2. The Supplier's request(s) for payment shall be made to tbe Procuring Entity inwriting, accompanied by an invoice describing, as appropriate, the Goods deliveredand/or Services performed, and by documents submitted pursuant to tbe seeprovision for GCC Clause 6.2, and upon fulfillment of otber obligations stipulated intbis Contract.

10.3. Pursuant to GCC Clause 10.2, payments shall be made promptly by the ProcuringEntity, but in no case later than sixty (60) days after submission of an invoice orclaim by the Supplier.

lOA. Unless otherwise specified in the see, the currency in which payment is made to tbeSupplier under tbis Contract shall be in Philippine Pesos.

11. AdvancePayment and Terms ofPayment

11.1. Advance payment shall be made only after prior approval of the President, and shallnot exceed fifteen percent (15%) ofthe Contract amount, unless otherwise directed bythe President or in cases allowed under Annex "D" ofRA 9184.

11.2. For Goods supplied from abroad, the terms of payment shall be as follows:

(a) On Contract Signature: Ten percent (10%) of the Contract Price shall be paidwithin sixty (60) days from signing of the Contract and upon submission of aclaim and a bank guarantee for the equivalent amount valid until the Goodsare delivered and in the form provided in SectionVITI.Bidding Forms.

(b) On Delivery: Seventy percent (70%) of the Contract Price shall be paid to theSupplier within sixty (60) days after the date of receipt of the Goods andupon submission of the documents (i) through (vi) specified in the SCCprovision on Delivery and Documents.

(c) On Acceptance: The remaining twenty percent (20%) of the Contract Priceshall be paid to the Supplier within sixty (60) days after the date ofsubmission of the acceptance and inspection certificate for the respectivedelivery issued by the Procuring Entity's authorized representative. In theevent that no inspection or acceptance certificate is issued by the ProcuringEntity's authorized representative within forty five (45) days of the dateshown on the delivery receipt the Supplier shall have the right to claimpayment of the remaining twenty percent (20%) subject to the PrdcuringEntity's own verification of the rcason(s) for the failure to issue documents(vii) and (viii) as described in the SCC provision on Delivery andDocuments.

11.3. All progress payments shall first be charged against the advance payment until thelatter has been fully exhausted.

12. Taxesand Duties

The Supplier, whether local or foreign, shall be entirely responsible for all the necessarytaxes, stamp duties, license fees, and other such levies imposed for the completion of thisContract.

13. PerformanceSecurity

13.1. Within ten (10) calendar days from receipt of the Notice of Award from the ProcuringEntity but in no case later than the signing of the contract by both parties, thesuccessful Bidder shall furnish the performance security in any the forms prescribedin the ITB Clause Error!Referencesourcenot found..

13.2. The performance security posted in favor of the Procuring Entity shall be forfeited inthe event it is established that the winning bidder is in default in any of its obligationsunder the contract.

13.3. The performance security shall remain valid until issuance by the Procuring Entity ofthe Certificate ofFina! Acceptance.

13.4. The performance security may be released by the Procuring Entity and returned to theSupplier after the issuance of the Certificate of Final Acceptance subject to thefollowing conditions:

(a) There are no pending claims against the Supplier or the surety company filed bythe Procuring Entity;

(b) The Supplier has no pending claims for labor and materials filed against it; and

(c) Other terms specified in the see.13.5. In case of a reduction of the contract value, the Procuring Entity shall allow a

proportional reduction in the original performance security, provided that any suchreduction is more than ten percent (10%) and that the aggregate of such reductions isnot more than fifty percent (50%) of the original performance security.

14. Use of Contract Documents and Information

14.1. The Supplier shall not, except for purposes of performing the obligations in thisContract, without the Procuring Entity's prior written consent, disclose this Contract,or any provision thereof, or any specification, plan, drawing, pattern, sample, orinformation furnished by or on behalf of the Procuring Entity. Any suc\!.disclosureshall be made in confidence and shall extend only as far as may be necessary forpurposes of such performance.

14.2. Any document, other than this Contract itself, enumerated in GCC Clause 14.1 shallremain the property of the Procuring Entity and shall be returned (all copies) to theProcuring Entity on completion of the Supplier's performance under this Contract ifso required by the Procuring Entity.

15. Standards

The Goods provided under this Contract shall conform to the standards mentioned in theSection VII. Technical Specifications; and, when no applicable standard is mentioned, to theauthoritative standards appropriate to the Goods' country of origin. Such standards shall bethe latest issued by the institution concerned.

16. Inspection and Tests

16.1. The Procuring Entity or its representative shall have the right to inspect and/or to testthe Goods to confirm their conformity to the Contract specifications at no extra costto the Procuring Entity. The see and Section VII. Technical Specifications shallspecifYwhat inspections and/or tests the Procuring Entity requires and where they areto be conducted. The Procuring Entity shall notifYthe Supplier in writing, in a timelymanner, of the identity of any representatives retaiIledfor these purposes.

16.2. If applicable, the inspections and tests may be conducted on the premises of theSupplier or its subcontractor(s), at point of delivery, and/or at the goods' [maldestination. If conducted on the premises of the Supplier or its subcontractor(s), allreasonable facilities and assistance, including access to drawings and production data,shall be furnished to the inspectors at no charge to the Procuring Entity.

16.3. The Procuring Entity or its designated representative shall be entitled to attend thetests and/or inspections referred to in this Clause provided that the Procuring Entity

shall bear all of its own costs and expenses incurred in connection with suchattendance including, but not limited to, all traveling and board and lodging expenses.

16.4. The Procuring Entity may reject any Goods or any part thereof thilt fail to pass anytest and/or inspection or do not conform to the specifications. The Supplier shalleither rectify or replace such rejected Goods or parts thereof or make alterationsnecessary to meet the specifications at no cost to the Procuring Entity, and shallrepeat the test and/or inspection, at no cost to the Procuring Entity, upon giving anotice pursuant to GeC Clause 5.

16.5. The Supplier agrees that neither the execution-ofa test and/or inspection of the Goodsor any part thereof, nor the attendance by the Procuring Entity or its representative,shall release the Supplier from any warranties or other obligations under thisContract.

17. Warranty

17.1. The Supplier warrants that the Goods supplied under the Contract are new, unused, ofthe most recent or current models, and that they incorporate all recent improvementsin design and materials, except when the technical specifications required by theProcuring Entity provides otherwise.

17.2. The Supplier further warrants that all Goods supplied under this Contract shall haveno defect, arising from design, materials, or workmanship or from any act or omissionof the Supplier that may develop under normal use of the supplied Goods in theconditions prevailing in the country of final destination.

17.3. In order to assure that manufacturing defects shall be corrected by the Supplier, awarranty shall be required from the Supplier for a minimum period specified in theSCC. The obligation for the warranty shall be covered by, at the Supplier's option,either retention money in an amount equivalent to at least ten percent (10%) of everyprogress payment, or a special bank guarantee equivalent to at least ten percent (10%)of the Contract Price or other such amount if so specified in the SCC. The saidamounts shall only be released after the lapse of the warranty period specified in theSCC; provided, however, that the Supplies delivered are free from patent and latentdefects and all the conditions imposed under this Contract have been fully met.

17.4. The Procuring Entity shall promptly notify the Supplier in writing of any claimsarising under this warranty. Upon receipt of such notice, the Supplier shall, withinthe period specified in the SCC and with all reasonable speed, repair or replace thedefective Goods or parts thereof, without cost to the Procuring Entity.

17.5. Ifthe Supplier, having been notified, fails to remedy the defect(s) within the periodspecified in GCC Clause 17.4, the Procuring Entity may proceed to take suchremedial action as may be necessary, at the Supplier's risk and expense and withoutprejudice to any other rights which the Procuring Entity may have against theSupplier under the Contract and under the applicable law.

18. Delaysin the Supplier's Performance

18.1. Delivery of the Goods and/or performance of Services shall be made by the Supplierin accordance with the time schedule prescribed by the Procuring Entity in SectionVI. Schedule of Requirements.

18.2. If at any time during the performance of this Contract, the Supplier or itsSubcontractor(s) should encounter conditions impeding timely delivery of the Goodsand/or performance of Services, the Supplier shall promptly notity the ProcuringEntity in writing of the fact of the delay, its likely duration and its cause(s). As soonas practicable after receipt of the Supplier's notice, and upon causes provided forunder GCC Clause 22, the Procuring Entity shall evaluate the situation and mayextend the Supplier's time for performance, in which case the extension shall beratified by the parties by amendment of Contract.

18.3. Except as provided under GCC Clause 22, a delay by the Supplier in the performanceof its obligations shall render the Supplier liable to the imposition of liquidateddamages pursuant to GeC Clause 19, unless an extension of time is agreed uponpursuant to GeC Clause 29 without the application of liquidated damages.

19. LiquidatedDamages

Subject to GCC Clauses 18 and 22, if the Supplier fails to satisfactorily deliver any or all ofthe Goods and/or to perform the Services within the period(s) specified in this Contractinclusive of duly granted time extensions if any, the Procuring Entity shall, without prejudiceto its other remedies under this Contract and under the applicable law, deduct from theContract Price, as liquidated damages, the applicable rate of one tenth (1/10) of one (I)percent of the cost of the unperformed portion for every day of delay until actual delivery orperformance. The maximum deduction shall be ten percent (10%) of the amount of contract.Once the maximum is reached, the Procuring Entity shall rescind the Contract pursuant toGCC Clause 23, without prejudice to other courses of action and remedies open to it.

20. SettlementofDisputes

20.1. If any dispute or difference of any kind whatsoever shall arise between the ProcuringEntity and the Supplier in connection with or arising out of this Contract, the partiesshall make every effort to resolve amicably such dispute or difference by mutualconsultation.

20.2. If after thirty (30) days, the parties have failed to resolve their dispute or difference bysuch mutual consultation, then either the Procuring Entity or the Supplier may givenotice to the other party of its intention to commence arbitration, as hereinafterprovided, as to the matter in dispute, and no arbitration in respect of this matter maybe commenced unless such notice is given.

20.3. Any dispute or difference in respect of which a notice of intention to commencearbitration has been given in accordance with this Clause shall be settled byarbitration. Arbitration may be commenced prior to or after delivery of the Goodsunder this Contract.

20.4. In the case of a dispute between the Procuring Entity and the Supplier, the disputeshall be resolved in accordance with Republic Act 9285 ("R.A. 9285"), otherwiseknown as the "Alternative Dispute Resolution Act of2004."

20.5. Notwithstanding any reference to arbitration herein, the parties shall continue toperform their respective obligations under the Contract unless they otherwise agree;and the Procuring Entity shall pay the Supplier any monies due the Supplier.

21. Liability of the Supplier

21.1. The Supplier's liability under this Contract shall be as provided by the laws of theRepublic of the Philippines, subject to additional provisions, if any, set forth in thesec.

21.2. Except in cases of criminal negligence or willful misconduct, and in the case ofinfringement of patent rights, if applicable, the aggregate liability of the Supplier tothe Procuring Entity shall not exceed the total Contract Price, provided that thislimitation shall not apply to the cost of repairing or replacing defective equipment.

22. Forj:e Majeure

22.1. The Supplier shall not be liable for forfeiture of its performance security, liquidateddamages, or termination for default if and to the extent that its delay in performanceor other failure to perform its obligations under the Contract is the result of a forcemajeure.

22.2. For purposes of this Contract the terms "force majeure" and "fortuitous event" maybe used interchangeably. In this regard, a fortuitous event or force majeure shall beinterpreted to mean an event which the Contractor could not have foreseen, or whichthough foreseen, was inevitable. It shall not include ordinary unfavorable weatherconditions; and any other cause the effects of which could have been avoided with theexercise of reasonable diligence by the Contractor. Stich events may include, but notlimited to, acts of the Procuring Entity in its sovereign capacity, wars or revolutions,fires, floods, epidemics, quarantine restrictions, and freight embargoes.

22.3. If a force majeure situati9n arises, the Supplier shall promptly notifY the ProcuringEntity in writing of such condition and the cause thereof. Unless otherwise directedby the Procuring Entity in writing, the Supplier shall continue to perform itsobligations under the Contract as far as is reasonably practical, and shall seek allreasonable alternative means for performance not prevented by theforce majeure.

23. Termination for Default

23.1. The Procuring Entity shall terminate this Contract for default when any of thefollowing conditions attends its implementation:

(a) Outside offorce majeure, the Supplier fails to deliver or perform any or all ofthe Goods within the period(s) specified in the contract, or within anyextension thereof granted by the Procuring Entity pursuant to a request madeby the Supplier prior to the delay, and such failure amounts to at least tenpercent (10%) of the contact price;

(b) As a result offorce majeure, the Supplier is unable to deliver or perform anyor all of the Goods, amounting to at least ten percent (10%) of the contractprice, for a period of not less than sixty (60) calendar days after receipt of thenotice from the Procuring Entity stating that the circumstance of forcemajeure is deemed to have ceased; or

(c) The Supplier fails~o p~rformany other obligation under the Contract.

23.2. In the event the Procurillg f\1!!ty terminates this Contract in whole or in part, for anyof the reasons providel\ W1!l~rGee Clauses 23 to 26, the Procuring Entity mayprocure, upon such te~ #~in such manner as it deems appropriate, Goods or

Services similar to those undelivered, and the Supplier shall be liable to the ProcuringEntity lor any excess costs for such similar Goods or Services. However, theSupplier shall continue performance of this Contract to the extent not terminated.

23.3. In case the delay in the delivery of the Goods and/or performance of the Servicesexceeds a time duration equivalent to ten percent (10%) of the specified contract timeplus any time extension duly granted to the Supplier, the Procuring Entity mayterminate this Contract, forfeit the Supplier's performance security and award thesame to a qualified Supplier.

24. Termination for Insolvency

The Procuring Entity shall terminate this Contract if the Supplier is declared bankrupt orinsolvent as determined with finality by a court of competent jurisdiction. In this event,termination will be without compensation to the Supplier, provided that such termination willnot prejudice or affect any right of action or remedy which has accrued or will accruethereafter to the Procuring Entity and/or the Supplier.

25. Termination for Convenience

25.1. The Procuring Entity may terminate this Contract, in whole or in part, at any time forits convenience. The Heild of the Procuring Entity may terminate a contract for theconvenience of the Government if he has determined the existence of conditions thatmake Project Implementation economically, fmancially or technically impracticaland/or unnecessary, such as, but not limited to, fortuitous event(s) or changes in lawand national government policies.

25.2. The Goods that have been delivered and/or performed or are ready for delivery orperformance within thirty (30) calendar days after the Supplier's receipt of Notice toTerminate shall be accepted by the Procuring Entity at the contract terms and prices.For Goods not yet performed and/or ready for delivery, the Procuring Entity mayelect:

(a) to have any portion delivered and/or performed and paid at the contract termsand prices; and/or

(b) to cancel the remainder and pay to the Supplier an agreed amount forpartially completed and/or performed goods and for materials and partspreviously procured by the Supplier.

25.3. Ifthe Supplier suffers loss in its initial performance of the terminated contract, suchas purchase of raw materials for goods specially manufactured for the ProcuringEntity which carmot be sold in open market, it shall be allowed to recqver partiallyfrom this Contract, on a quantum meruit basis. Before recovery may be made, thefact of loss must be established under oath by the Supplier to the satisfaction of theProcuring Entity before recovery may be made.

26. Termination for Unlawful Acts

26.1. Thei'rocuring Entity may terminate this Contract in case it is determined prima faciethat the Supplier has engaged, belore or during the implementation of this Contract,in unlawful deeds and behaviors relative to contract acquisition and implementation.Unlawful acts include, but are not limited to, the following:

(a) Corrupt, fraudulent, and coercive practices as defined in ITB Clause 3.1(a);

(b) Drawing up or using forged documents;

(c) Using adulterated materials, means or metbQds,Qr engaging in productiQncQntrary tQrules Qf science Qrtbe trade; and

(d) Any Qther act analQgQus tQtbe fQregQing.

27. Procedures for Termination of Contracts

27.1. The fQllQwing provisiQns shall gQvern tbe procedures fQr terminatiQn Qfthis CQntract:

(a) UpQIl receipt Qf a written repQrt Qf acts or causes which may cQnstitutegrQund(s) fQr terminatiQn as afQrementiQned, Qr upon its own initiative, theImplementing Unit shall, witbin a periQd Qf seven (7) calendar days, verifythe existence Qf such grQund(s) and cause the executiQn Qf a Verified RepQrt,with all relevant evidence attached;

(b) UpQn recQmmendatiQn by the Implementing Unit, tbe Head Qf tbe PrQcuringEntity shall terminate tbis CQntract Qnly by a written nQtice to tbe SuppliercQnveying the terminatiQn Qf this Contract. The nQtice shall state:

(i) tbat tbis CQntract is being terminated fQr any Qf the ground(s) afQre-mentiQned, and a statement of tbe acts tbat cQnstitute tbe grQund(s)constituting tbe same;

(ii) tbe extent QfterminatiQn, whetber in whQle Qr in part;

(iii) an instructiQn tQ tbe Supplier tQ shQWcause as tQ why this ContractshQuld nQt be terminated; and

(iv) special instructions Qfthe PrQcuring Entity, if any.

(c) The NQtice tQ Terminate shall be accQmpanied by a copy Qf the VerifiedRepQrt;

(d) Witbiil a period Qf seven (7) calendar days frQm receipt Qf the NQtice QfTerminatiQn, the Supplier shall submit to tbe Head Qf the Procuring Entity averified pQsitiQn paper stating why tbis CQntract shQuld nQt be terminated. Iftbe Supplier fails tQ shQWcause after tbe lapse Qf tbe seven (7) day (ieriQd,eitber by inaction QJ"by default, the Head Qf tbe PrQcuring Entity shall issuean Qrder terminating tbis CQntract;

(e) The Procuring Entity may, at anytime befQre receipt Qfthe Supplier's verifiedpQsitiQn paper described in item (d) abQve withdraw tbe NQtice tQ Terminateif it is determined that certain items Qr wQrks subject Qf tbe nQtice had beencQmpleted, delivered, Qr perfQrmed befQre tbe Supplier's receipt Qf tbenotice;

(f) Witbin a nQn-extendible periQd Qf ten (10) calendar days frQm receipt Qf theverified pQsitiQn paper, tbe Head of tbe PrQcuring Entity shall decide whetherQJ"nQt tQ terminate this CQntract. It shall serve a written nQtice tQ tbeSuppli~1( Qf its decisiQn and, unless Qtberwise provided, tbis CQntract isdeemed: t~t:!"inated frQm receipt Qftbe Supplier of the notice QfdecisiQn. Theterminatioli shall pnly be based Qn tbe grQund(s) stated in tbe NQtice tQ

• - ;1' .Termmate; "

(g) The Head of the Procuring Entity may create a Contract Termination ReviewCommittee (CTRC) to assist him in the discharge of this function. Alldecisions recommended by the CTRC shall be subject to the approval of theHead of the Procuring Entity; and

(h) The Supplier must serve a written notice to the Procuring Entity of itsintention to terminate the contract at least thirty (30) calendar days before itsintended termination. The Contract is deemed terminated if it is not resumedin thirty (30) calendar days after the receipt of such notice by the "ProcuringEntity.

28. Assignment of Rights

The Supplier shall not assign his rights or obligations under this Contract, in whole or in part,except with the Procuring Entity's prior written consent.

29. Contract Amendment

Subject to applicable laws, no variation in or modification of the terms of this Contract shallbe made except by written amendment signed by the parties.

30. Application

These General Conditions shall apply to the extent that they are not superseded by provisionsof other parts of this Contract.

Special Conditions of Contract

Annn E

GCCClause

1.1 (g) The Procuring Entity is the Department of Budget and Management.

1.1 (i) The Supplier is

Water for Less Purification System-Paco Branch

1.10) The Funding Source is:

The Government of the Philippines (GOP) through the authorized appropriations under the FY2014 General Appropriations Act in the amount of Two Hundred Sixty Five Thousand SixHundred Eighty Pesos (p265,680.00).

1.1 (k) Department of Budget and ManagementDBM Bldg. III, General Solano StreetSan Miguel, Manila

5.1 The Procuring Entity's address for Notices is:

Department of Budget and ManagementDBM Bldg. III, General Solano StreetSan Miguel, Manila

Tel Nos.: 733-2192Fax No. : 726-2773

The Supplier's address for Notices is:

1370-Il Garden Plaza Hotel, General Luna St.Paco, Manila

6.1 The DBM reserves the right to increase or decrease the supply of purified drinking water forany reason, and in such event, there shall be a corresponding downward or upward adjustmentin the consideration in such sum as may be agreed upon by the parties provided that theresulting cost of said increase or decrease shall not exceed the ABC.

6.2 The Goods shall only be delivered by the Supplier at DBM Bldg. ill Ground Floor, GeneralSolano Street, SanMiguel, Manila not later than 10:00 a.m. on the day of delivery asindicated in Section VI. Schedule of Requirements.

Moreover, the delivery schedule as indicated in Section VI. Schedule of Requirements may bemodified by the DBM during Contract implementation with prior due notice, written or verbal,to the Supplier.

9.0 For the given scope of work in this Contract as awarded, all bid prices are considered fixedprices, and therefore not subject to price escalation during contract implementation, exceptunder extraordinary circumstances and upon prior apIiroval of the GPPB in accordance withSection 61 ofRA No. 9184 and its IRR.

10. Payment shall be made within ten (10) working days upon complete submission of thefollowing documents:

a. Invoice, or Billing, or Statement of Account, for the period covered;

b. Periodic Microbiological/Bacteriological Test, Physical/Chemical Test; andCertificate of Potability;

c. Certification by the Director, Administrative Service to the effect thatGoods/Services have been delivered or rendered in accordance with the termsof the Contract.

13.1 No further instructions.

13.4 No further instructions.

14. No further instructions.

16.1 The quantity of the Goods delivered to DBM shall be inspected by the Administrative Service.Moreover, anytime during the contract duration, the Client shall require the Contractor toconduct the physical and chemical test which includes odor, color, turbidity, Res. Chlorine, pH,acidity, alkalinity, nitrite, total dissolved solids, total suspended solids, and heavy metals (Cu,Cr, Pb), at the Contractor's expense to a laboratory accredited by the Department of Health.

17.4 and No further instructions.17.519.1 The applicable rate is one tenth (1/10) of one (I) percent of the cost of the unperformed portion

for every day of delay.

The maximum deduction shall be ten percent (10%) of the amount of contract. Once thecumulative amount of liquidated damages reaches ten percent (10%) of the amount of thecontract, the procuring entity shall rescind the contract, without prejudice to other courses ofaction and remedies to open it. The Procuring Entity may also rescind the contract and imposeten percent (10%) of the amount of the contract as liquidated damages, upon non-performanceby the Supplier of any of its obligations under the contract.

The imposition of liquidated damages in all instances shall be automatic, except upon priorrequest for extension and approval thereof by the Procuring Entity before the scheduleddelivery date.

Anv request for extensipn not acted uoon before deliverv date shall be considered denied.20.4 In the case of a dispute between the Procuring Entity and the Supplier, the dispute shall be

resolved in accordance with RA No. 9285, otherwise known as the "Alternative DisputeResolution Act of2004."

21.1 If applicable, all partners to the joint venture shall be jointly and severally liable to theprocuring entity.

REPUBLIC OF THE PHILIPPINESDEPARTMENT OF BUDGET AND MANAGEMENT

BONCODIN HALL, GENERAL SOLANO STREET, SAN MIGUEL, MANILA

NOTICE OF AWARD

March 31t 2014

MS. JOYCE SJ. SEMILLAWater for Less Purif,cation System-Paco Branch1370-B Garden Plaza Hotel, General Luna StreetPaco. Manila

Dear Ms. Semilla:

We are pleased to inform you that the contract for the project, "Supply of Drinking Water withHot and Cold Water Dispenser for CY 2014" is hereby awarded to your company in the amountof Two Hundred Sixty Five Thousand Six Hundred Eighty Pesos (P265,680.00).

In this regard, you are hereby required to post a performance security in the amount and formstated in Section 39 of the Implementing Rules and Regulations of Republic Act No. 9184,within ten (10) calendar days upon receipt of this Notice.

Very truly yours,

"F=" .-'-----fLORENCIO B. ABADSC'cnl!mT

voyer ILL4 (3/[3/ /II-fl }!\/11llt f7X U-~ f4 Q) )

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REPUBLIC OF THE PHILIPPINESDEPARTMENT OF BUDGET AND MANAGEMENTBONCODIN HALL, GENERAL SOLANO STREET, SAN MIGUEL, MANILA

NOTICE TO PROCEED

April 01, l01~

MS. JOYCE SJ. SEMILLAWater for Less Purification System-Paco Branch1370-B Garden Plaza Hotel, General Luna StreetPaco, Manila

Dear Ms. Semilla:

This is to inform your company that performance of the obligations specified in the attachedContract for the Project, "Supply of Drinking Water with Hot and Cold Water Dispenser for CY2014" shall commence upon receipt of this Notice to Proceed.

Very truly yours,

/

IFLORENCIO ;;BADsecretary~ ,"

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