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TMI COATINGS, INC.
<br />TERMS AND CONDITIONS FOR PROPOSAL
<br />TMI COATINGS, INC.TERMS AND CONDITIONS FOR PROPOSAL
<br />A. CONDITIONS OF AGREEMENT. Unless otherwise expressly provided in the proposal or contract to
<br />which these terms and conditions are a part, TMI Coatings, Inc. ("TMI") has based its proposal price upon
<br />the Owner furnishing at its expense the job conditions listed below. The required job conditions and
<br />Owner's responsibilities are as follows:
<br />1. TRANSPORTATION CONDITIONS. There shall be direct access by truck to and upon a clear,
<br />we "drained site over an all-weather, hard surfaced road.
<br />2. LABOR CONDITIONS. Working periods shall be eight hours per day and 40 hours per week under usual
<br />labor conditions, utilizing painters and general laborers withoutjunsdictionaI disputes between or hiring of
<br />operating engineers, electricians or teamsters. The job site shall be available to TMI for overtime work
<br />should TMI deem it necessary a desirable. TMI's price is based upon the ability to perform on an open
<br />shop bass
<br />3. WORKING CONDITIONS. There shall be safe and clean working conditionsin compliance with federal,
<br />state and local safety, environmental and air pollution laws and ordinances. Unless specifically agreed
<br />otherwise in writing in this proposal, there shall be no interference with TMI of its work area byother trades
<br />and the Owner shall provide TMI reasonable access to the work area and reasonable setup and storage
<br />are-
<br />4. HAZARDOUS MATERIALS AND SPECIFIED MATERIALS. TMI assumes no risk of hazardous
<br />materials (which shall be deemed to include, without limitations, asbestos, PCBs, lend paint, heavy metal
<br />paint, petroleum products, radioactive materials, harmful fumes, other pollutants, and materials
<br />contaminated by anyof these things) at the site unless otherwise sated within this proposal. TMI has not
<br />included additional costs associated with the presence d hazard.. materials. Concerning soil conditions,
<br />TMI'. bid is based on the assumption that if the soil analysis of heavy metal increases after and due to
<br />TMI'. work beyond the current federal permissible level of 1,000 ppm, TMI's sole responsibility will be to
<br />scrape the tops.' and place it in Owner -provided cumpsters to be disposed d at Owner'scost. The Owner
<br />shall comply with all applicable federal, state and local governmental requirements relating to notification,
<br />monitoring, survey, evaluation, detection, remediation, removal and disposal of hazardous materials
<br />(hereinafter "Substance Requirements). The Owner shall provide TMI with written evidence of compliance
<br />and reaultsot all Substance Requirements. TMI may rely upon the Owner's representations and warranties
<br />regarding hazardous substances and Owner's compliance with Substance Requirements. TMI shall have
<br />no duty to identify, detect, evaluate, remediate, remove, a dispose of any hazardous materials. If TMI at
<br />anytime has reason to believe that hazardous materials are present at the work ste, TM11 maydemand that the Owner, at Owner's sole expense, perform appropriate evaluation and monitoring of
<br />suspected
<br />hazardous materials and provide written results to TMI. TMI shall have the right to remove its employees
<br />from the work site until such evaluation and results are made. If hazardous material is present, TMI shall
<br />receive an extension of time and an equitable adjustment in the contract price in its favor. All material and
<br />product specifications are those of the Owner, and TMI shall not be responsible for any consequences of
<br />the installation of specified materials or products. If no materials are specified and TMI selects materials for
<br />the work, TMI has no duty to investigate or test Win d proposed materials with existingg
<br />materials. To the fullest extent permitted bylaw, the Owner shall defend, indemnify and hdd harml—TMI
<br />from any and all penalties, fines, actions, liabilities, damages and costs (including reasonable attorneys'
<br />fees and expert fees) arisng from or relating to hazard.. materials ar the project site, use of specified
<br />materials a products, a work performed as requested by Owner a the enforcement of this paragraph. TMI
<br />shall not be responsible for any hazardous materials that may be stared or exist within the work of TMI, and
<br />the Omer hereby releases and discharges TMI from any and all claims, causes of action, suits, demands
<br />for arbitration, and'iabi'iry (including claims for subrogation) relating to the actual, alleged, or threatened
<br />discharge, dispersal, release, or escape of hazardous materials during performance or at any time
<br />thereafter, however caused, or to hazardous materials at the project site or use of specified materials or
<br />ioducts.
<br />SITE UTILITIES. The Owner shall make available drinking water, sanitaryfadlities and water to be used
<br />by TMI pressure washers. The Owner shall make adequate electrical power (460 or 230 volt and 110 volt
<br />power) available within 100 feet of TMI's work area.
<br />6. HEAT CONDITIONS. The Owner shall maintain heat at 600 F minimum temperseature in any enclosed
<br />facilities in which TMI's work will be performed. At TMI's sole discretion, coatings in unendod area may
<br />not be applied at temperatures less than 60° F, nor in excessive humidity, nor in high wind unless sated
<br />otherwise within this proposal. TMI shall not be responsible for providing temporary heat to satisfactorily
<br />perform work.
<br />7. SURFACE PREPARATION AND CLEAN-UP CONDITIONS. This proposal excludes surface
<br />preparation and coating of inaccessible and/or difficult to ready areas (i.e. back to back angles, top side
<br />beam flange, under equipment) unless otherwise specified herein. Prior to, during and after TMI's
<br />performance of TMI's work, the Owner, without delaying or interfering with TMI's work, shall (unless
<br />otherwise included in TMI's proposal):
<br />a. Remove from all surfaces to be coated all contaminants such as oil, grease, soluble schemicals,
<br />man -hole covers, pipes, cathodic systems, dirt and debris, together with alts, internal and other obstructions
<br />which interfere with TMI's performance of its work.
<br />b. Perform all grinding, welding or patch work on surfacesto be worked on by TMI including honeycombs,
<br />roughness, blow holes, etc., suffiaent to prepare and maintain a smooth surface acceptable for coating in
<br />the sole opinion of TMI.
<br />c. Provide dumpsters and disposal for TMI's project refuse, including sandblast abrasive.
<br />d. The Owner must clean, sanitize and inspect the equipment, work area and areas new the work area
<br />prior to putting these areas back into service. TMI is not responsible for anycantaminants, material, debris,
<br />tls, substance or other object not cleared or cleaned from the equipment, work area and areas near the
<br />work area.
<br />8. WORK AREA CONDITIONS. The Owner assumes sole responsibility for loss, damage, or injury to
<br />property (including without limitation vessel internals, light gauge metal equipment, automobiles or
<br />mechanical equipment) caused by ordinary sandblasting, solvent, insulation or coating operation and
<br />further assumes responsbility for the removal (a if acceptable to TMI the covering and protection) of
<br />any
<br />Property from the work area prior to TMI's commencement of work. Unless specifically stated in writing
<br />otherwise on this proposal, TMI's proposal is based upon open abrasive blasting without containment of
<br />dust and sandblast debris. O ra% willexist to some extent on nearbyy areas. It is impractical to cover or
<br />clean surrounding areas in industrial applications. Owner to be responsbls for removal of obstructions and
<br />items not to be coated including coils, grating, antennas, etc. The Owner warrants that any concrete to be
<br />coated or treated shall be free of any materials or conditions (including, without limitation, moisture, curing
<br />agents, finishing, additives, and spelling) that may cause or contribute to failure of specified materials
<br />applied to it TMI shall not be liable for any failure caused by or contributed to by the existence of such
<br />conditions and shall not be responsible for correcting such conditions unless specifically agreed to
<br />otherwise in writing. Unless specifically stated in writing otherwise on this praposa', TMI's proposal is based
<br />upon removal (to the extent speafied on the proposal) of thin-film coatings of the generic type typically
<br />utilized for the serves type of the structure. Additional costs for removal of thic(-film coatings, coal tar
<br />epoxy, 100 % solids epoxy, polyurethane or polyurea and other difficult to remove coatings will require
<br />additional compensation per Section D Price Adjustments Owner warrants that existing coatings which will
<br />remain are compatible with materials to be applied by TMI and have adequate adhesion to adhere to the
<br />substrate upon application of subsequent coat(s) required by this proposal. The Owner shall be responsible
<br />for identifying, locating, and relocating pipelines and utilities, unless otherwise provided in this Agreement.
<br />The Owner shall remove all persons (other than amploymsot TMI or TMI'. subcontractors), food products,
<br />and any other property sensitive to dhemicals related to TMI's work or else shall otherwise fully protect all
<br />such persons, food products and prapertyfran chemicals related to TMI's work. The Owner is responsible
<br />for its employees and other persons that are on its premises where odorous and nonadcrous chemicals
<br />are going to be applied. Such notice by the Owner shall be given to allow individuals that are dhemically
<br />sensitive to leave the area prior to TMI applying such chemicals Both TMI and the Owner agree that the
<br />parties expect that residual odors shall seep into adjacent areas. TMI is not liable for any damages,
<br />including injuries, death, a property damages caused by chemicals related to TMI's work used during
<br />installation. To the extent that the Owner fails to adhere to the above provisions, concerning the application
<br />byTMl of dhemicals, and such failure bythe Owner results in injuries or damages than subjectTMl to claims
<br />of liability to the fullest extent permitted by law, the Owner agrees to fully indemnifyTMI for all expenditures
<br />incurred by TMI to defend against and/or settle such claims, including attorneys' fees, expert fees, costs,
<br />disbursements, and e%ses.
<br />9. PROTECTION OF WORK The Owner shall protect and be responsible for protection of lining material,
<br />insulation, coating, and other work during application or installation through completion and after
<br />completion from fire and physical damage, including damage by other trades.
<br />10. SECONDARYDIKES. Industryguidelinesoffen require secondarycikes or similar protection to contain
<br />spilled or leaked chemicals and/or to preventground contamination at a potentially date. His the sole
<br />responsibility of the Owner to determine the desirability of such protection and, if necessary, to provide it
<br />prior to commencement of the work. In no event shall TMI incur liabilityto the Owner or any other party, on
<br />the thcoryot negligence or otherwise, for failing to adviss or warn the Owner or anyother parryof the need
<br />or advisability of sudh protection, for failing to provide sudh protection, or for proceeding with the work in the
<br />absence of such protection.
<br />11. DESIGN. The Owner is restponsb'e for the design of the project Without limitation, the Owner is
<br />responsible for determining whether capacities, including dike capacities, are adequate, whether the work
<br />will meet regulations, whether design of the project is adequate for rain or snow runoff, and whether there
<br />is proper drainage. The Owner is responsible bath during and after performance fa drainage, including
<br />drainage d precipitation, and for preventing'floatirg" of tanks The Owner shall be responsiblefa slippery
<br />conditions of dike lining and for any injuries that result.
<br />12. INFORMATION. The Owner shall provide TMI with all information relevant to the performance of TMI's
<br />work and shall desgnate a representative who shall be fully acquainted with the work to be performed and
<br />who has authority to give approvals on behalf of the Owner and can render decisions promptly and furnish
<br />information promptly. TMI is entitled to rely upon information provided by the Owner as being complete and
<br />accurate.
<br />B. NOTIFICATION AND MOBILIZATION FOR COMMENCEMENT OF WORK The Owner shall give TMI
<br />at leas 30 days advance written notification of the date upon which the Owner desires TMI to commence
<br />work. The Owner shall unload and store in a secure area materials that arrive at the job site before TMI
<br />workers. If the work is not ready to begin when TMI's crew arrives or delays occur once the work has
<br />started, the contract price will be equitably adjusted in TMI's favor in accordance with paragraph D below.
<br />C. INSPECTION AND PERFORMANCE STANDARDS. The following inspection sandardswill be used to
<br />judge the quality of TMI's work:
<br />1. Sandblasting will be inspected usingg The Society for Protective Coatings (SSPC) Visual Standards for
<br />Abrasive Blasi Cleaned Steel (VIS 1A9) photographic standard as the bass for accepting or rejecting
<br />sandblasting work. The Owner shall commence inspection immediately after TMI begins sandblasting
<br />using photographic SSPC VIS 1-89 standards. 9 the Owner failsto inspect sandblasting immediately after
<br />TMI begins, the Owner will be condusvely presumed to have waived inspection of surface preparation and
<br />the cost of any rework resulting from later inspection will be at the Owner's expense.
<br />2. Coatings inspection will be accomplished bythe Owner as follows:
<br />a. Color, gloss and texture will be inspected bythe Owner immediately upon the start of final coat and any
<br />difference in interpretation shall be immediately resolved before further work proceeds. Failure or refusal ot
<br />the Owner to inspect when TMI begins application of the final coat will constitute a waiver of the Owner's
<br />right of rejection, and the Owner shall be condusvdy presumed to have accepted the mating, cola, gloss
<br />and texture and any other deficiencies which would have been discovered by a detailed inspection.
<br />Variations due to scaffold location and overspray are normal in the industry and will not be cause for
<br />rework.
<br />b. Film thickness application will be as specified in TMI's proposal and measurement of film thickness shall
<br />be performed as in SSPC-PA 2, Revision 11/1/82, using a magnetic gauge. The Owner shall compensate
<br />TMI for the cos of taking or repairing damages caused by test samples.
<br />c. Coatings will be air cured in accordance with manufacturer's specifications and the Owner will be
<br />responsible far venting anyenclosed spaces, including tank interiors, for 7 days at 70" F to remove fumes.
<br />If a force heat rare is required to expedite completion, additional cos of forced rare shall be added to the
<br />contract price.
<br />3. Insulation inspection shall be accomplished bythe Owner as follows:
<br />a. Prior to application of any insulation, Owner shall approve a sample panel for surface appearance,
<br />thickness, variation, and design adequacy. The sample shall be sprayed at the same ambient temperature
<br />at which the work is to be performed. If schedule delays cause a change in climate conditions after the
<br />sample is submitted, the Owner shall approve anew sample or make allowances for actual job site
<br />conditions of wind, humidity, and temperature.
<br />b. Insulation thickness may vary but average thickness will not be less than minimum specified on the
<br />contract.
<br />c. The Owner shall inspect insulation immediately after application begins each day and if no objections are
<br />raised then, insulation shall be deemed to have been accepted.
<br />d. The maximum operating temperature for normal urethane foam is 190- F and the Owner shall raise or
<br />lower the temperature of the insulated tank as necessary from ambient to desired temperature ever a
<br />minimum of a 48 hour period. TMI reservesthe rightto install "temp -tabs at.r discretion. Owner assumes
<br />responsibility for maintaining operating temperature and assumes all liability in the event the temperature
<br />limitations far the insulation used are exceeded.
<br />e. An acceptable application is based on 90%adhesion of the urethane foam.
<br />4. Coatings over foam are a commercial ap liation, defined as appreciably pinhde-free. Substantially
<br />pinhole -free application is available at addPional cost Pinhole -free steel coatings depend on steel
<br />preparation, substrate grinding and other necessary preparation work other than sandblasting and is not
<br />included unless otherwise specified in TMI's proposal.
<br />5. Damage caused by an inspection will be repaired at the Owner's expense as an "extra to the contract
<br />amount
<br />D. PRICE ADJUSTMENTS. The contract price and schedule shall be equitably adjusted to compensate
<br />TMI for its additional costs (with reasonable markup) and delay incurred as a result ot any of the following:
<br />1. Any breach of contractby the Owner.
<br />2. Concealed or unknown conditions encountered in the performance of the work at variance with the
<br />conditions indicated bythe drawings, specifications, or Owner -furnished information or differing materially
<br />from those ordinarily encountered and generally recognized as inherent in work d the character provided
<br />for in this Agreement.
<br />3. Events beyond the control of TMI, including without limitation, ads of God, earthquakes, floods, high
<br />winds, terrorism, vandalism, labor disputes, fire, unusual delay in deliveries, casualties, unusual weather,
<br />or changes in law and rules of government
<br />4. Any additional walk ordered or requested bythe Owner.
<br />5. Unless otherwise specified in this proposal, TMI's bid includes only one mobilimtion/demobilization. In
<br />addition to the contract price and any other monies due TMI, TMI is entitled to collect a minimum of 10%of
<br />the total price of TMI's work on this project for each subsequent mobilization/demobilization if TMI is not
<br />permitted to complete all work in one mobilization/demobilization. The price adjustment shall include an
<br />increase for the following:
<br />a. Labor and supervision payroll costs plus all applicable taxes, insurance and other fringe benefits
<br />b. Material costs at TMI's invoke cost for material, fuel, tax and frelght, including costs for returned or
<br />damaged material and freightcharges, less anyreturned credit allowed bythe manufacturer.
<br />c. Cost of equipment furnished to the job by TMI computed at Professional Coating Management, Inc.'s
<br />weekly rental rates
<br />d. Employea travel expensss between the job site and TMI's home office, along with related expenses,
<br />including hotels and meal costs.
<br />e. Subcontractor costs.
<br />I. Freight and transportation charges for equipment
<br />g. Insurance and bond costs
<br />h. Construction overhead dharged as a percentage of direct labor in accordance with TMI's regular
<br />amounting practices.
<br />i. Markup ot 25 % on all of the above changes and any other costs incurred by TMI.
<br />j. Such other costs and damages as TMI may incur.
<br />E. ESCALATION. Quoted prices are based on labor rates and material prices in effect as of date d the
<br />proposal. Material price or labor rate increases will be invoiced as they occur on the following bass:
<br />1. For each 1%increase in average labor rate on the job, or fraction thereof, an additional sum of 0.7%of
<br />contract price will be invoked.
<br />2. Increases in material prices will be invoiced at actual cost plus a 25%markup. Upon request, TMI will
<br />furnish average labor rate and material prices as a bass for escalation.
<br />F. LIMITED WARRANTY. For one year after installation, TMI warrants only to the al Owner that
<br />materials have been applied or installed as required bythiscontract. TMI will repair defectiveoriginwork of which
<br />TMI is notified in writing within a period of one year after application, provided the work has not been
<br />damaged by Owner a used for a purpose for which it was not intended. TMI is not responsible for
<br />conditions beyond its control including but not limited to hydrostatic pressure, vapor, moisture, frost ice,
<br />groundwater, water and/or moisture pressure or emissions, capillary action, sail or slab stability, substrate
<br />cradking, the absence or presence or condition of vapor or moisture barriers and/or weather barriers, fork
<br />truck or other traffic damage, or use for which the work is not intended. Coatings are not considered a
<br />failure if concrete or old exsting coatings are attached to the delaminated materials; this is considered a
<br />substrate failure. TMI SPECIFICALLY DISCLAIMS ANY AND ALL OTHER WARRANTIES, INCLUDING
<br />IMPLIED WARRANTIES OR WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICU-
<br />LAR PURPOSE, AND OWNER AGREES THAT ITS SOLE RENEDYFOR DEFECTIVE WORK OR ANY
<br />DAMAGE RESULTING FROM SUCH DEFECT, WHETHER OR NOT CAUSED BYTHE NEGLIGENCE
<br />OF TMI, SHALL BE REPAIRED BYTMI. OWNER FURTHER AGREES THAT IN NO EVENT SHALL TMI
<br />BE LIABLE FOR CONSEQUENTIAL DAMAGES OF ANY NATURE, INCLUDING, WITHOUT
<br />LIMITATION, DAMAGES FOR LOSS OF USE OR LOST REVENUES, LOSS OF REPUTATION, COSTS
<br />OF FINANCING, LOST BUSINESS, BUSINESS INTERRUPTION, DAMAGE TO THE STRUCTURE,
<br />DAMAGE TO OR LOSS OF CONTENTS, GROUND OR GROUNDWATER CONTAMINATION,
<br />DAMAGE RESULTING FROM SPILLAGE OR LEAKAGE, OR DAMAGE RESULTING FROM
<br />POLLUTION OR RELEASE OF HAZARDOUS MATERIALS. THE FOREGOING WARRANTY IS THE
<br />ONLY WARRANTY MADE BY TMI AND IS EXPRESSLY MADE IN LIEU OF ANY AND ALL OTHER
<br />WARRANTIES, GUARANTEES OR REPRESENTATIONS, WHETHER EXPRESSED OR IMPLIED.
<br />THIS WARRANTY RUNS BETWEEN TMI AND THE OWNER ONLY, IT IS NOT ASSIGNABLE OR
<br />TRANSFERABLE TO A SUCCESSOR, ASSIGN OR ANOTHER OWNER, AND ANY SUCH ASSIGN-
<br />MENT IS VOID AND UNENFORCEABLE.
<br />G. PAYMENT TERMS. TMI shall invoice the Owner monthly for labor and materials furnished during the
<br />preceding 30 days Invoices shall be paid bythe Owner within 30 days after submission. No retainaz7e shall
<br />e withheld from payments unless otherwise stated in this proposal. Payment withheld bythe Owner shall
<br />bear interest at the rate of 18%per annum from the due date a, if less, the maximum rate permitted by law.
<br />H. DISPUTES AND APPLICABLE LAW. ff the project locale is Minnesota, then anydisputes between TMI
<br />and the Owner not required to be resolved in federal court shall be resolved in Dakota County, Minnesota.
<br />Unless prohibited by statute, this Agreement shall be interpreted and enforced in accordance with the laws
<br />of the State of Mnnesota orapplicable federal law without regard to conflicts of law principles. This
<br />Agreement will be deemed to have been made and entered into in the State of Mnnesota for all purposes.
<br />If TMI elects to consult an attorney or take any type of legal action to enforce this Agreement or defend
<br />against Owner claims, TMI is entitled to recover all resulting attorneyt fees, expert fees, disbursements,
<br />expenses, and arbitration and court costs from Owner.
<br />1. COMPLETE AGREEMENT AND MODIFICATIONS. This document and other documents incorporated
<br />herein by reference constitute the complete, entire and integrated understanding of the parties and
<br />supersedes all prior and/or contemporaneous negotiations, representations a agreements, either written
<br />or oral. This Agreement may be modified only by written amendment signed by both parties and may not
<br />be amended in anyother. manner. ff any provision ot this Agreement is determined to be unenforceableor
<br />invalid, that provision shall be deemed severed from this Agreement and the remaining portions of this
<br />Agreementshall be enforced with the same farce and effect as if the severed portion had never been a part
<br />of this Agreement
<br />J. TERMINATION. In the event of default by the Owner or stoppage of work for a period of thirty days by
<br />direction of the Owner, or any other public authority having jurisdiction, TMI may terminate this Agreement
<br />without further written notice and the Owner shall pay to TMI all sums due under this Agreement together
<br />with TMI's anticipated profits and all other related damages, expenses, and legal fees.
<br />K INSURANCE AND TAXES. TMI shall maintain in force during performance of this Agreement Workers'
<br />Compensation Insurance and Public Liability Insurance as required by law. The Owner shall carry at its
<br />expense "all risk- Builder's Risk insurance upon the entire project ste to the full insurable value thereof on
<br />a replacement cost bass. This insurance shall induce the interests of the Owner, TMI, and TMI's
<br />subcontractors and suppliers, and shall insure against"all risks of physcal lomor damage caused byfire,
<br />extended coverage perils, flood, earthquake, theft, vandalism, malicious mischief, and other insurable
<br />perils. The Owner shall purchass and maintain such insurance as will insure itself, TMI and TMI's
<br />subcontractors and suppliers against loss of use of property due to fire and other hazards, however
<br />caused. The Owner and TMI waive all rights against each other and the contractors, subcontractors of any
<br />other, consultants, agents, and employeasot any d them for damages caused by fire or other perils to the
<br />extent covered bythe Builder's Risk insurance required to be obtained bythe Owner by this Paragraph or
<br />other property insurance applicable to the work of TMI a the properttyyot the Owner except such rights as
<br />the Owner and TMI have to the proceeds of sudh insurance. The pcfiaea ct insurance shall provide sudh
<br />waivers of subrogation by endorsement or othervvise. A waiver of subrogation shall be effective as to a
<br />person or entity even though that person or entity would oherwiss have a duty of indemnification,
<br />contractual or otherwise, did notpay far the insurance and whether a not the person or entity had an
<br />insurable interest in the property damaged. TMI shall pay all unemployment compensation taxes and social
<br />securitytaxes as may be required by law.
<br />as:2018 Proposal Terms 8 Conditions
<br />SPF #156, REV 9/18
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