Page Title

Subcontract

SUBCONTRACT TABLE OF CONTENTS

Section 1. Description of Work 4
Section 2. Contract Documents 4
Section 3. Work to be Performed 5
Section 4. Payments 5
Section 5. Retainage Reduction 7
Section 6. Changes and Extra Work 7
Section 7. Progress of Work and Order of Performance 7
Section 8. Delays, Extensions of Time, Stoppage or Suspension of Work, Disputes 9
Section 9. Arbitration 10
Section 10. Responsibility for the Work 11
Section 11. Indemnification 11
Section 12. Insurance 12
Section 13. Bonds 14
Section 14. Obligations of Subcontractor 14
Section 15. Liens 15
Section 16. Use or Occupancy by Contractor 15
Section 17. Damage to Other Work 15
Section 18. Independent Contractor 15
Section 19. Owner’s Representative 16
Section 20. Assignment and Subletting 16
Section 21. Safety 16
Section 22. Labor Laws 17
Section 23. Drawings, Plans and Specifications 18
Section 24. Setting of Stakes 18
Section 25. Notices 18
Section 26. Labor Agreements 18
Section 27. Default 19
Section 28. Severability 19
Section 29. Clean Up 19
Section 30. Non-Waiver 20
Section 31. Entire Subcontract 20
Section 32. Applicable Law 20
Section 33. Binding On Successors 20
Section 34. Section Titles 20

SUBCONTRACT

Rev 10/04

THIS SUBCONTRACT, made this 22nd day of February, 2005, by and between XYZ., Inc. (hereinafter
called Subcontractor), including its heirs, executors and successors, and DIABLO CONTRACTORS, INC.
(hereinafter called Contractor), including its heirs, executors, successors, and assigns, WITNESSETH:

SECTION 1. DESCRIPTION OF WORK. Subcontractor agrees to furnish all necessary materials, labor,
tools, equipment, scaffolds appliances, supplies, and other things necessary to perform and to perform all
work identified as follows:

Bid Item Description Unit Qty Unit Cost Total

Total Bid

Attached Exhibit “A” is an integral part of this Subcontract.

(hereinafter called the Work) for and at the project identified as Caltrans Contract No. XXXXXX
(hereinafter called the Project), located on the premises at XXXXXXXXXXXXXXXXXXX (hereinafter
called the Premises), as shown and described in and in strict accordance with the Plans, Caltrans
Standard Specifications (July 1999), General Conditions, Special Conditions, Addenda thereto and other
Documents for the Project forming, or by reference made, a part of the Contract and prepared by State of
California Department of Transportation (hereinafter called the Architect) and with the terms and
conditions of the General Contract (hereinafter called General Contract) between Contractor and State of
California Department of Transportation (hereinafter called the Owner) dated DATE all of which shall be
considered part of this Subcontract by this reference thereto and incorporated by reference herein as
though fully set forth (hereinafter called Contract Documents) and Subcontractor agrees to be bound to
Contractor and Owner by the terms and provisions in the Contract Documents.

SECTION 2. CONTRACT DOCUMENTS. The Subcontractor represents and agrees that it has carefully
examined and understands this Subcontract and the other Contract Documents, has investigated the
nature, locality and site of the Work and the conditions and difficulties under which it is to be performed
and that it enters into this Subcontract on the basis of its own examination, investigation and evaluation
of all such matters and not in reliance upon any opinions or representations of Contractor, or of any of
their respective officers, agents, servants, or employees.

With respect to the work to be performed and furnished by the Subcontractor hereunder, the
Subcontractor agrees to be bound to Contractor by each and all of the terms and conditions of the
General Contract and the other Contract Documents, and to assume toward Contractor all of the duties,
obligations and responsibilities that Contractor by those Contract documents assumes toward the Owner,
and the Subcontractor agrees further that Contractor shall have the same rights and remedies as against
the Subcontractor as the Owner under the terms and conditions of the General Contract and the other
Contract Documents has against Contractor with the same force and effect as though every such duty,
obligation, responsibility, right or remedy were set forth herein in full. The terms and conditions of this
Subcontract with respect to the Work to be performed and furnished by the Subcontractor hereunder are
intended to be and shall be in addition to and not in substitution for any of the terms and conditions of the
General Contract and other Contract Documents.

This Subcontract, including all attachments, the conditions of the General Contract and the other
Contract Documents are intended to supplement and compliment each other and shall, where possible,
be thus interpreted. If however, any provision of this Subcontract conflicts with a provision of the General
Contract and the other Contract Documents, the provision imposing the greater duty or obligation on the
Subcontractor shall govern.

SECTION 3. WORK TO BE PERFORMED. It is agreed that the materials and equipment to be furnished
and work to be done by Subcontractor will be as described in Section 1 for this Project. Regardless of the
conditions of the General Contract, the Subcontractor shall furnish and pay for all layout, backing, testing,
hoisting of men and materials, temporary heat, power and lighting required for work to be performed under
this Subcontract. If materials and equipment are to be furnished but are not required to be installed under
this Subcontract, such materials and equipment are to be delivered F.O.B. jobsite.

SECTION 4. PAYMENTS. Contractor shall pay Subcontractor for furnishing the materials and equipment
and performing the Work the sum of $$$$$$$$$$$$ (hereinafter called Subcontract Price) subject to
additions and deductions for changes agreed upon or determined as hereinafter provided. Partial
payments will be made to Subcontractor in an amount equal to 90% of the value of completed work in
the schedule of values and materials and equipment incorporated in the construction as estimated by
Owner's Representative, less previous payments, such partial payments shall become due to
Subcontractor 10 days after Contractor receives payment from Owner. Upon complete performance of this
Subcontract by Subcontractor and final approval and acceptance thereof by Owner, Contractor will make
final payment to Subcontractor of the balance due under this Subcontract within 45 days after full
payment for such work and materials has been received by Contractor from Owner. However, if a progress
and/or final payment from Owner for the work is not received by Contractor, through no fault of
Subcontractor, Contractor will make payment to Subcontractor after Contractor has been afforded a
reasonable period of time to obtain payment from Owner through either litigation or arbitration.

“Reasonable time” shall be determined according to the relevant circumstances, but in no event shall be
less than the longest period of time required by either Contractor or the Subcontractor to pursue to
conclusion their legal remedies against Owner or other responsible party to obtain payment, including
(but not limited to) mechanic’s lien remedies or other related and similar remedies.

No partial payment to Subcontractor shall operate as approval or acceptance of work done or materials
and equipment furnished under this Subcontract. If Subcontractor is to be paid for work on a unit price
basis, Subcontractor agrees to be bound by Owner's measurement of the quantity of work; however, if
Owner does not provide any measurement of work or is incorrect, Subcontractor agrees to be bound by
Contractor’s measurement of the work. Any partial payment or payments made by Contractor to
Subcontractor will be subject to final audit and adjustment and Subcontractor agrees to reimburse
Contractor for any overpayment. Acceptance by Subcontractor of final payment shall release Contractor
and its surety of all claims arising under or by virtue of this Subcontract except those claims previously
submitted in writing by Subcontractor. As between the parties hereto and except as expressly provided
otherwise in this Subcontract, Subcontractor accepts the price as full compensation for doing all work and
furnishing all materials and equipment contemplated and embraced in this Subcontract; for all loss or
damage arising out of the nature of the work aforesaid or from the action of the elements or from any
unforeseen difficulties or obstructions which may arise or be encountered in the prosecution of the work
until its acceptance by Owner; for all risks of every description connected with the work; for all expense
incurred by or in consequence of the suspension or discontinuance of the work; and for faithfully
completing work and the whole thereof in the manner and according to the requirements of Contractor
and Owner and Owner's Representative.

Contractor may deduct from any amounts due or to become due to Subcontractor any sum or sums owing
by Subcontractor to Contractor whether or not arising under this Subcontract and in the event of any
breach by Subcontractor of any terms or conditions of this Subcontract, or in the event of the assertion by
other parties of any claim of lien against Contractor or its surety or the construction site arising out of
Subcontractor's performance of this Subcontract, Contractor shall have the right, but is not required, to
retain out of any payments due or to become due to Subcontractor an amount sufficient to completely
protect Contractor from any and all loss, damage or expense there from until the situation has been
remedied or adjusted by Subcontractor to the satisfaction of Contractor .

Contractor reserves the right to make payment by joint check or by direct check to Subcontractor and to
Subcontractor's material men or subcontractors or any person who has right of action against Contractor or
its surety under any law. Contractor reserves the right to determine the manner and amount of payment to
be made.

Subcontractor shall furnish, if requested by Contractor, sworn affidavit’s under penalty of perjury from time
to time, in accordance with the form provided by Contractor, which shall state amounts due or to become
due and amounts paid to suppliers, its laborers and other parties contractually related with Subcontractor
with respect to labor and materials furnished or to be furnished under this Subcontract.

Subcontractor agrees and covenants that money received for the performance of the Work shall be used
solely for the benefit of persons and firms supplying labor, materials, supplies, tools, machines,
equipment, plant or services exclusively for the Project in connection with this Subcontract and having
the right to assert liens or other claims against the land, improvements or funds involved in the Project or
against any bond or other security posted by Contractor or Owner, that any money paid to Subcontractor
pursuant to this Subcontract shall immediately become and constitute a trust fund for the benefit of said
persons and firms, and shall not in any instance be directed by Subcontractor to any other purpose until
all obligations arising there under have been fully discharged and all claims arising there from have been
fully paid. Subcontractor agrees, as a condition precedent to payment hereunder, to furnish Contractor
with such partial or final releases of claims or waivers of Lien as Contractor may from time to time request.

Monthly progress payments to Subcontractor will not be released until Subcontractor provides the
following:

* Company Safety Program
* Weekly Safety Meeting minutes with signatures of Subcontractor’s employees
* Evidence that workers are trained in the use of Hazardous materials they will use for the work
* Monthly Work Force Reports
* Evidence that Subcontractor’s As-Built drawings are current
* Certified Payrolls with Statement of Compliances and Fringe Benefit Statements
complying with prevailing wage as determined by DLSR, webpage: http://www.dir.ca.
gov/DLSR/statistics_research.html
* Current Insurance Certificates

Subcontractor shall submit a schedule of values to Contractor with the signed Subcontract for approval.

All progress billings must be submitted by the 15th day of each month unless otherwise amended in
writing. All billings must show the Contractor job number and description. Billings not received by the
15th of the billing period month will be processed in the following months billing.

Labor and equipment rates must be submitted and approved. The approved rates will be made part of this
Subcontract and used for pricing any changes in the scope of work.

If at any time Contractor, at its sole discretion, shall determine that Subcontractor's financial condition
has become unstable or unsatisfactory, Subcontractor shall furnish additional security satisfactory to
Contractor within three days after written demand therefore is delivered to Subcontractor. If Subcontractor
fails to timely furnish said additional security, Contractor shall have the option to terminate
Subcontractor's right to proceed or to initiate such other action as Contractor may, at its sole discretion,
deem necessary for the protection or preservation of its interest and the prevention of delay in the progress
of work on the Project, including but not limited to the work to be performed by Subcontractor hereunder.
In the event of such cancellation, the rights of Contractor shall be the same as if Subcontractor had
willfully refused to further perform the Subcontract.

SECTION 5. RETAINAGE REDUCTION. If at any time prior to final payment hereunder Owner reduces the
amount of retainage held from Contractor, Contractor may, at its sole discretion, without the consent of
Subcontractor's Surety, reduce accordingly the retained percentage withheld from Subcontractor.

SECTION 6. CHANGES AND EXTRA WORK.
(a) Contractor may, at any time by written order and without notice to Subcontractor's Surety, make
changes in, additions to and omissions from the work to be performed and materials and equipment to be
furnished under this Subcontract, and shall make an appropriate adjustment in the subcontract price and
time of performance. If Subcontractor shall disagree with such adjustment, Subcontractor shall give
written notice to Contractor and any further adjustment shall be agreed upon in writing by the parties
hereto, but Subcontractor shall immediately proceed with the performance of the Work as so changed.
Any change or modification shall be subject to all the terms and conditions of this Subcontract.

(b) If Owner shall order any changes or extra work, including additions, reductions or deletions, in the work
to be performed hereunder or within the general classification of any work to be performed hereunder,
Subcontractor will upon written order of Contractor perform the work required, and any adjustment in
compensation or in the time for performance shall be as the parties agree. If the parties are unable to
agree, Subcontractor shall nevertheless proceed with such work and shall give prompt written notice
thereof to Contractor. The amount of compensation and the time of performance shall be adjusted only to
the extent allowed by Owner. Subcontractor shall comply with and be bound by any notice conditions
and claims procedure, including arbitration, contained in the General Contract or required by Owner. If
any claim of Subcontractor is presented to Owner together with claims of Contractor or others, Contractor's
determination as to Subcontractor's share of any award by Owner shall be binding and conclusive on
Subcontractor.

(c) Any claim for adjustment of the subcontract price or time of performance must be made in writing and
given to Contractor in such time that Contractor has at least three (3) working days in which to satisfy the
notice requirements of the Contract Documents. No increase or decrease in the subcontract price or time
of performance shall be binding on Contractor unless agreed upon in writing.

(d) All requests for quotation for changes to the scope of work must be returned to Contractor no later than
three (3) working days from the issuance date of the request. Contractor will assign a reference number to
each change. The Contractor reference number must be referenced when submitting a quotation.

Subcontractor must obtain written authorization from the Contractor Project Manager for any extra work
prior to incurring any expenses. Any costs incurred on a time and material basis must be accompanied by
work tags signed on a daily basis by a Contractor authorized representative. Signing of work tags is for
documentation of labor and/or materials and equipment only and does not constitute a commitment for
payment or associated expenses.

Allowable Subcontractor mark-up on direct cost for authorized changes in the work beyond the scope of
this Subcontract shall be subject to approval by Contractor.

SECTION 7. PROGRESS OF WORK AND ORDER OF PERFORMANCE. Time is of the essence of this
Subcontract. Subcontractor shall furnish all materials, labor, tools, equipment and supplies necessary for
the performance of this Subcontract in a proper, efficient and workmanlike manner and so as to perform
the work in accordance with and within the time specified in progress schedules designated or prepared
by Contractor and submitted to Subcontractor or any revisions thereof. Subcontractor shall prosecute the
work in a prompt and diligent manner whenever such work, or any part of it, becomes available, or at such
other time or times as Contractor may direct, and so as to promote the general progress of the entire
construction, and shall not interfere with or hinder the work of Contractor or any other Subcontractor. If
Contractor shall deem it necessary, Subcontractor, at its own expense and on demand by Contractor, shall
provide additional work forces, overtime or additional shifts and shall expedite the furnishing of materials
and equipment so as to meet the applicable progress schedule. Any materials and equipment that are to
be furnished by Subcontractor hereunder shall be furnished in sufficient time to enable Subcontractor to
perform and complete its work within the time or times required under this Subcontract. Subcontractor
shall reimburse Contractor for any and all damages suffered by or assessed against Contractor, including
liquidated damages, which are attributable to or caused by Subcontractor's failure to furnish the materials
or to perform the work required by the Subcontract within the time fixed or in the manner provided for
herein. Payment of such damages shall not release Subcontractor from its obligation to otherwise fully
perform this Subcontract. Upon written request by Contractor, Subcontractor shall furnish to Contractor
within thirty (30) days of receipt of Contractor demand for payment such evidence as Contractor may
require relating the Subcontractor's ability to fully perform this Subcontract in the manner and within the
time specified herein.

Subcontractor is to maintain at all times a safe and clean work area. The frequency and method of
Subcontractor clean-up shall be such that other trades are not negatively impacted and access to the
work area is not restricted, unsafe conditions are not created and Owner is satisfied with the appearance of
the work. All debris, packing materials, scraps, dunnage, etc., associated with the Subcontractor’s work is
to be removed offsite by Subcontractor (including dump fees, if applicable). The costs of this clean up
and removal is included within the Subcontract Price.

Subcontractor is required to provide complete submittals in accordance with the Contract Documents and
Contractor in a time frame which allows for Owner/Architect review, ordering, fabrication, manufacturer’s
lead time, shipping, etc., such that they do not delay the completion of the work. Submittal rejected by
the Owner/Architect for incompleteness or non-compliance with the documents does not constitute
grounds for delay to Subcontractor’s work. Subcontractor is expected to recoup all time lost due to late
submittals at its own expense.

Submittal Quantities: (per Prime Contract or)
Shop Drawings: (1) Correctable Translucent Reproducible
(5) Bluelines
Product Data: (6) Copies
Samples: (3) Sets
Work Plans and Reports: (3) Sets

Subcontractor is to provide sufficient labor, materials and equipment to meet all milestone dates and
final completion date of the construction schedule(s) to be forwarded by transmittal and subsequently
made a part of this Subcontract.

Subcontractor shall keep as-built record Plans current and accurate to reflect actual work progress.
Contractor may periodically inspect record Plans. Non current and/or inaccurate Plans will constitute
basis for withholding progress payments until Plans are updated or corrected by Subcontractor.

Subcontractor is responsible to provide drinking water for its own work force.

Subcontractor is responsible for their employee parking. On site parking is not available unless authorized
in writing by Contractor.

Subcontractor shall provide daily work reports indicating the number of workers, location of work and type
of work. This report must be submitted on a daily basis for review by the Contractor Project Manager.

Subcontractor must comply with all local, State Federal and National Codes, ordinances, laws and
authorities having jurisdiction at the time this Subcontract is fully executed.

Subcontractor is responsible for the behavior and conduct of Subcontractor’s employees and second tier
subcontractors under employ of Subcontractor. If Contractor, at its sole discretion, shall determine that
Subcontractor or any persons under employ of Subcontractor are conducting themselves in a manner
deemed to be unacceptable to the operations of the Project, this person(s) will be banned from the
Premises for the duration of the Project.

Subcontractor agrees to satisfactorily complete all punch list items within 10 days from receipt of punch
list from Contractor. Contractor reserves the right after 10 days have lapsed, and the punch list is not
satisfactorily completed, to complete punch list items at the expense of the Subcontractor.

Subcontractor must turn over all Operation and Maintenance Manuals, Guarantees, Warranties and As-
built Plans within fourteen (14) days after contract work is complete. Subcontractor agrees to a deduct
from monies due to Subcontractor of $500.00 per day for each day these items are not delivered in
satisfactory condition to Contractor within thirty (30) days after receipt of Contractor demand for payment.

If Subcontractor fails to comply with the conditions herein as to character and time of performance, and
the failure is not corrected within forty-eight hours after written request by Contractor to Subcontractor,
Contractor may, without prejudice to any other right or remedy, take over and complete the performance
of the Subcontract at the expense of Subcontractor, or Contractor may, without taking over the work,
furnish the necessary materials and may employ any other person or persons including another
subcontractor to finish the work and provide the materials therefore, all without liability on the part of
Contractor for any damage, wear and tear, depreciation, theft, action of the elements, acts of God, fire,
flood, vandalism, or other injury or damage to said materials, tools, and appliances and in case of such
discontinuance of Subcontractor's employment by Contractor , Subcontractor shall not be entitled to
receive any further payment under this Subcontract until the said work shall be wholly finished and
Contractor shall have received payment in full therefore from Owner, at which time, if the unpaid balance
of the amount to be paid under this Subcontract exceeds the expenses incurred by Contractor in finishing
the work, such excess shall be paid by Contractor to Subcontractor; but if such expense shall exceed such
unpaid balance, then Subcontractor shall pay the difference to Contractor . As used in this Section the
work "expense" shall mean actual cost to Contractor plus fifteen per cent (15%) for overhead. The
expense incurred by Contractor as herein provided, either for furnishing materials or for finishing the work,
and any damages incurred as a result of such default, shall be chargeable to and paid by Subcontractor
and Contractor shall have a lien upon all materials, tools and appliances taken possession of, as
aforesaid, to secure the payment thereof.

Upon the appointment of a receiver for Subcontractor or upon Subcontractor making an assignment for
the benefit of creditors, or if Subcontractor seeks protection under the Bankruptcy Code or commits any
other act of insolvency; Contractor may, absent any applicable legal limitation, terminate this Agreement
upon giving forty-eight (48) hours written notice, by certified mail, to Subcontractor and its surety, if any. If
an order for relief is entered under the Bankruptcy Code with respect to Subcontractor, Contractor may
terminate this Agreement by giving forty-eight (48) hours written notice, by certified mail, to
Subcontractor, its trustee, and its surety, if any, unless Subcontractor, the surety, or the trustee:

(a) promptly cures all defaults;
(b) provides adequate assurance of future performance;
(c) compensates Contractor for actual pecuniary loss resulting from such defaults; and
(d) assumes the obligations of Subcontractor within the statutory time limits.

SECTION 8. DELAYS, EXTENSIONS OF TIME, STOPPAGE OR SUSPENSION OF WORK, DISPUTES. If
Subcontractor's performance of the Work is delayed or interfered with by acts of Owner, Contractor or other
subcontractors, it may request an extension of time for the performance of same, as hereinafter provided.
Subcontractor may be entitled to an increase in the Subcontract price or to damages or additional
compensation as a consequence of such delays. If a progress schedule is furnished by Contractor to
Subcontractor, it shall be solely for Contractor’s benefit; however, Subcontractor must be ready to perform
at the times indicated in the progress schedule(s). Contractor makes no representation that it will be ready
for Subcontractor at the times indicated in said schedule(s) regardless of whether delays may be within
the control of Contractor. As required by Contractor, Subcontractor shall submit to Contractor progress
schedules for the Work or at Contractor’s election, cooperate in the preparation of a progress schedule for
the Work.

No allowance of an extension of time, for any cause whatever, shall be granted to Subcontractor unless
Subcontractor shall have made written request upon Contractor for such extension within forty-eight hours
after the commencement of the delay and unless Contractor and Subcontractor have agreed in writing
upon the allowance of additional time to be made. If such extension of time is requested because of
Owner caused delays or delays allowable under the General Contract, any extension of time shall be
granted to Subcontractor only to the extent allowed by Owner.

If Owner, with or without cause, shall terminate the General Contract or shall stop or suspend work under
the General Contract, or if Owner shall fail to pay when due any sum payable under the General Contract,
Contractor may terminate the Subcontract or order Subcontractor to stop or suspend work hereunder and
Contractor shall be liable to Subcontractor for any such termination, stoppage or suspension only to the
extent that Owner shall be liable to Contractor therefore. Contractor will pay to Subcontractor the value of
work that Subcontractor has completed before the work was terminated stopped or suspended but only to
the extent that Owner shall be liable to Contractor for such work of Subcontractor. If payment for the
reasonable value of the Work is not received by Contractor from the Owner, Contractor will make payment
to Subcontractor after Contractor has been afforded a reasonable period of time to obtain payment from
Owner through either litigation or arbitration.

In the event of any dispute or claim between Contractor and Owner which directly or indirectly involves
the work required to be performed by Subcontractor under this Subcontract or in the event of any dispute
or claim between Contractor and Subcontractor which directly or indirectly involves a claim against
Owner for the either additional compensation or an extension of time under the General Contract,
Subcontractor agrees to be bound to Contractor and Contractor agrees to be bound to Subcontractor to
the same extent that Contractor is bound to Owner by the terms of the General Contract and by all
decisions, findings, or determinations made there under, whether by the person so authorized in the
General Contract, or by an administrative agency or court of competent jurisdiction or by arbitration,
whether or not Subcontractor is a party thereto. If any dispute or claim is prosecuted or defended by
Contractor , and Subcontractor is not directly a party or litigant, Subcontractor agrees to cooperate fully
with Contractor and to furnish all documents, statements, witnesses and other information required by
Contractor for such purpose, at no cost to Contractor and shall pay or reimburse Contractor for all
expenses and costs, including reasonable attorney's fees, incurred in connection therewith to the extent of
Subcontractor's interest in such claim or dispute. It is expressly understood and agreed in connection with
the determination of such claims or disputes that, as to any and all work done and agreed to be done by
Subcontractor, and as to any and all materials or services furnished or agreed to be furnished by
Subcontractor, and as to any and all damages, if any, incurred by Subcontractor in connection with the
work, Contractor shall never be liable to Subcontractor to any greater extent than Owner is liable to
Contractor.

If Subcontractor should commit any act which causes delay to the Project, Subcontractor shall be liable
for all losses, costs, expenses, liabilities and damages, including consequential damages and liquidated
damages sustained by Contractor , or for which Contractor may be liable to Owner or any other party
because of Subcontractor’s actions.

It is further specifically agreed by the parties hereto that no claim, dispute or controversy shall interfere
with the progress and performance of work required to be performed under this Subcontract and that
Subcontractor shall proceed as directed by Contractor in all instances with the work under the
Subcontract and that any failure of Subcontractor to comply herewith and to proceed with the work shall
automatically be deemed a breach of this Subcontract entitling Contractor to all remedies available in
the event of breach.

SECTION 9. ARBITRATION: If any dispute shall arise between Contractor and Subcontractor pertaining in
any manner to the construction or interpretation of this Subcontract, or to the rights or obligations of the
parties arising hereunder, or to the breach hereof, or arising out of Subcontractor’s performance of the
Work, which the parties are unable to settle by mutual agreement, it shall be settled by arbitration in
accordance with the current Construction Industry Arbitration Rules of the American Arbitration
Association. Judgment upon the award in any arbitration proceeding may be entered in any court having
jurisdiction thereof. The arbitrator(s) in any arbitration proceeding shall have the right to allocate his or
their fees between the parties or to charge all of such fees to one party, as the arbitrator(s) shall deem to
be just. The law of the State of California shall govern all disputes referred to in this section. The
prevailing party shall be entitled to recover its reasonable attorney’s fees from the other party. The
provisions of section 1283.05 of the Code of Civil Procedure of the State of California (pertaining to
depositions and discovery) hereby are incorporated by reference herein and are made a part hereof.

To the extent not prohibited by their contracts with others, the claims and disputes of Owner, Contractor,
Subcontractor and other Subcontractors, suppliers and/or material men involving a common question of
fact or law shall be heard by the same arbitrator(s) in a single proceeding.

SECTION 10. RESPONSIBILITY FOR THE WORK. Subcontractor shall be responsible for its own work,
property and materials until completion and final acceptance of the General Contract and release of
responsibility by Owner, and shall bear the risk of any loss or damage until such acceptance. In the event
of loss or damage, Subcontractor shall proceed promptly to make repairs or replacement of the damaged
work, property or materials at its own expense, as directed by Contractor. Subcontractor waives all rights
Subcontractor might have against Contractor for loss or damage to Subcontractor's work, property or
materials.

SECTION 11. INDEMNIFICATION. Subcontractor's Performance. With the exception that this section shall
in no construed to require indemnification by the Subcontractor to a greater extent than permitted by law,
the Subcontractor shall defend, indemnify and save harmless the Contractor, including its officers,
directors, agents (excluding agents who are design professionals), and employees, and each of them
(Indemnitees), from any and all claims, demands, causes of action, damages, costs, expenses, actual
attorneys’ fees, losses or liabilities, in law or in equity, of every kind and nature whatsoever (Claims), arising
out of or in connection with the Subcontractor’s performance of this contract for:

A. Bodily injury including, but not limited to, bodily injury, sickness or disease, emotional injury or death
to persons, including, but not limited to the public, any employees or agents of the Subcontractor,
Contractor, owner, consultants, or other subcontractors and;
B. Damage to property of anyone including loss of use thereof;

caused or alleged to be caused in whole or in part by any negligent or otherwise legally actionable act or
omission of the Subcontractor or anyone directly or indirectly employed by the Subcontractor or anyone
for whose acts the Subcontractor may be liable.

Except as otherwise provided by law, the indemnification provisions above shall apply regardless of the
existence or degree of fault of Indemnitees. The Subcontractor, however, shall not be obligated to
indemnify Indemnitees for claims arising from conduct delineated in Civil Code Section 2782. Further,
the Subcontractor’s indemnity obligation shall not extend to Claims to the extent they arise from any
defective or substandard condition of the roadway which existed at or prior to the time the Subcontractor
commenced work, unless this condition has been changed by the work or the scope of the work requires
the Subcontractor to maintain existing Roadway facilities and the claim arises from the Subcontractor’s
failure to maintain. The Subcontractor’s indemnity obligation shall extend to Claims arising after the work
is completed and accepted only if these Claims are directly related to work. No inspection by the
Contractor, its employees or agents shall be deemed waiver by the Contractor of full compliance with the
requirements of this section.
The Subcontractor’s obligation to defend and indemnify shall not be excused because of the
Subcontractor’s inability to evaluate liability or because the Subcontractor evaluates liability and
determines that Subcontractor is not liable to the claimant. The Subcontractor will respond within 30
days to the tender of any claim for defense and indemnity by the Contractor, unless this time has been
extended by the Contractor. If the Subcontractor fails to accept or reject a tender of defense and
indemnity within 30 days, in addition to any other remedy authorized by law, so much of the money due
the Subcontractor under and by virtue of the contract as shall reasonably be considered necessary by the
Contractor, may be retained by the Contractor until disposition has been made of the claim or suit for
damages, or until the Subcontractor, accepts or rejects the tender of defense, whichever occurs first.
With respect to third party claims against the Subcontractor, the Subcontractor waives any and all rights
of any type to express or implied indemnity against the Contractor, its directors, officers, employees, or
agents (excluding agents who are design professionals).

SECTION 12. INSURANCE. Subcontractor shall, at his expense, procure and maintain insurance on all of
his operations, in companies acceptable to Contractor, as follows:

(a) Workers' Compensation and Employer's Liability Insurance. Workers' Compensation insurance shall be
provided as required by any applicable law or regulation. Employer's liability insurance shall be provided
in amounts not less than $1,000,000.00 each accident for bodily injury by accident, $1,000,000.00
policy limit for bodily injury by disease, and $1,000,000.00 each employee for bodily injury by disease.
Workers’ compensation insurance shall be written for not less than the statutory limits and shall include
Employers’ Liability Insurance at a limit of not less than one million dollars ($1,000,000.00). Said policy
shall include a waiver of subrogation endorsement in favor of Contractor Co. of California.

If there is an exposure of injury to Subcontractor's employees under the U.S. Longshoremen's and Harbor
Workers' Compensation Act, the Jones Act or under laws, regulations or statues applicable to maritime
employees, coverage shall be included for such injuries or claims.

(b) General Liability Insurance. Subcontractor shall carry Comprehensive General Liability or Commercial
General Liability insurance covering all operations by or on behalf of Subcontractor providing insurance
for Bodily Injury Liability and Property Damage Liability for the Limits of Liability indicated below and
including coverage for:

(1) Premises and Operations;
(2) Products and Completed Operations;
(3) Contractual Liability insuring the obligations assumed by Subcontractor in this Subcontract;
(4) Broad Form Property Damage (including Completed Operations);
(5) Explosion, Collapse and Underground Hazards; and
(6) Personal Injury Liability, including asbestos exposure.

The General Liability Insurance shall include a Waiver of Subrogation Endorsement in favor of Diablo
Contractors, Inc. of California.

Except with respect to Bodily Injury and Property Damage included within the Products and Completed
Operations Hazards, the Aggregate limits, where applicable, shall apply separately to Subcontractor's work
under this Subcontract.

(c) One of the following coverage forms is required:

(1) Comprehensive General Liability
(2) Commercial General Liability (Occurrence)

(d) If Subcontractor carries a Comprehensive General Liability policy, the Limits of Liability shall not be
less than a Combined Single Limit for Bodily Injury, Property Damage and Personal Injury Liability as
follows:

(1) Personal Injury and Bodily Injury:
* $1,000,000 each person
* $2,000,000 each occurrence

(2) Property Damage:
* $1,000,000 each occurrence

(e) If Subcontractor carries a Commercial General Liability (Occurrence) policy:

(1) The limits of liability shall not be less than:
* $1,000,000 each occurrence (combined single limit for Bodily Injury and Property Damage)
* $1,000,000 for Personal Injury Liability
* $1,000,000 Aggregate for Products-Completed Operations
* $1,000,000 General Aggregate

(2) If the policy does not have an endorsement providing that the General Aggregate Limit applies
separately to this Project or if Defense Costs are included in the Aggregate limits, then the required
Aggregate Limits shall be $2,000,000.00.

A “Modified Occurrence” form is not acceptable.
A “Claims Made” form of policy is not acceptable.

(h) With respect to whichever General Liability policy form is furnished under subparagraphs (b) (c) or (d)
above, Contractor, its officers, directors and employees and Owner shall be named as Additional Insureds.
The policy shall stipulate that the insurance afforded the Additional Insureds shall apply as primary
insurance and that any other insurance carried by Contractor , its officers, directors and employees or
Owner will be excess only and will not contribute with this insurance.

(i) Automobile Liability Insurance (Bodily Injury and Property Damage Liability) including coverage for all
owned, hired and non-owned automobiles. The limits of liability shall not be less than $1,000,000
Combined Single Limit for each accident. If Subcontractor's General Liability insurance is provided by a
Commercial General Liability policy then Subcontractor's Automobile Liability insurance policy shall
include coverage for Automobile Contractual Liability.

(j) Pollution Liability. If Subcontractor or their subcontractors are required to perform remedial hazardous
material operations such as asbestos containing materials, contaminated soil, etc., they must in addition
to the above requirements, carry a “Contractor’s Pollution Liability” policy with limits not less
$5,000,000.00 per occurrence and not less than $5,000,000 Aggregate for Bodily Injury and Property
Damage, naming Contractor, Owner, their respective officers, directors and employees as Additional
Insureds. If Subcontractor or their subcontractors haul hazardous waste, they must carry Environmental
Automobile Liability Insurance with a $5,000,000 combined single limit per Occurrence for Bodily Injury
and Property Damage applicable to all hazardous waste hauling vehicles and include the MCS90
Endorsement. This policy must also include Contractor, Owner, and their respective officers, directors and
employees as Additional Insureds.

(k) Subcontractor to Contractor shall furnish all required Certificate(s) of Insurance before any work is
commenced hereunder by Subcontractor. The Certificate of Insurance shall provide that there will be no
cancellation, reduction or modification of coverage without thirty- (30) days prior written notice to
Contractor. If Subcontractor does not comply with this section, Contractor may, at its option, provide
insurance coverage to protect Owner and Contractor and charge Subcontractor for the cost of that
insurance. The required insurance shall be subject to the approval of Contractor, but any acceptance of
insurance certificates by Contractor shall not limit or relieve Subcontractor of the duties and
responsibilities assumed by it under this Subcontract.

* Certificates shall be issued in duplicate.
* Certificates shall show the locations to which they apply.
* Certificates will be accompanied by Additional Insured Endorsement CG2010 11/85 Form
with primary wording requirements included on the endorsement form.
* The above insurance coverage shall be issued by a company satisfactory to Contractor.

(l) If higher limits or other forms of insurance are required in the General Contract or by Owner,
Subcontractor will comply with such requirements at no additional cost to Contractor.

(m) Contractor and Subcontractor waive all rights against each other and against all other subcontractors
and Owner for loss or damage to the extent covered by Builder's Risk or any other property or equipment
insurance applicable to the work, except such rights as they may have to the proceeds of such insurance.
If the policies of insurance referred to in this Section require an endorsement or consent of the insurance
company to provide for continued coverage where there is a waiver of subrogation, the owners of such
policies will cause them to be so endorsed or obtain such consent.

(n) The requirement for carrying insurance hereunder is cumulative and shall not be in derogation of
other provisions of this Subcontract. The Subcontract’s policies shall stipulate that their insurance will
operate as primary insurance and that no other insurance affected by Contractor will be called on to
contribute to a loss covered there under.

SECTION 13. BONDS. Unless waived in writing, Subcontractor shall furnish a Performance Bond in an
amount equal to the full subcontract price and a Payment Bond in an amount equal to the full
subcontract price. Such bonds shall be on forms furnished by Contractor and with a surety satisfactory to
Contractor. No change, alteration or modification in or deviation from this Subcontract, its terms,
conditions, plans or specifications, or in the manner, time or amount of payment as provided herein,
whether or not made in the manner herein provided, shall release or exonerate, in whole or in part, any
surety on any bond given in connection with this Subcontract. Said bonds shall extend to and cover any
extra work or changes performed by Subcontractor pursuant to this Subcontract. Contractor shall directly
pay bond premium to surety to a maximum of %1.5.

SECTION 14. OBLIGATIONS OF SUBCONTRACTOR. Subcontractor specifically obligates itself to
Contractor in the following respects (and this Subcontract is made upon such express conditions) to wit:

(a) To protect, hold free and harmless, defend and indemnify Owner and Contractor, their respective
members, officers, shareholders, directors and employees from any and all liability, penalties, costs,
losses, damages, expenses, causes of action, claims or judgments, including attorney’s fees and expert
witness fees resulting from any alleged or actual infringement or violation of any patent or patent right
arising in connection with this Subcontract and anything done there under:

(b) To protect, hold free and harmless, defend and indemnify Contractor , including its members, officers,
directors and employees, from all liability, penalties, costs, losses, damages, expenses, causes of action,
claims or judgments, including attorney's fees and expert witness fees, arising from injury to or death
sustained by any person (including Subcontractor's employees) or damage to property of any kind, which
injury, death or damage arises out of or is in any way connected with the performance of the Work.
Subcontractor's aforesaid indemnity and save harmless agreement shall apply to any acts or omissions, or
negligent conduct, whether active or passive, on the part of Contractor or Subcontractor (or their agents,
subcontractors or employees); except that said agreement shall not be applicable to injury, death or
damage to property arising from the sole negligence or willful misconduct of Contractor , its officers,
agents, servants, or independent contractors (other than Subcontractor) who are directly responsible to
Contractor. This indemnification agreement shall extend to claims asserted after termination, for whatever
reason, of this Subcontract.

(c) To pay for all materials, equipment, including repairs thereof and parts, fuel and labor, including sales
taxes and other taxes, ordered for or used in the work by Subcontractor and shall suffer no claim of lien or
statutory withholding notice to be filed or served with respect to the work and shall present, on demand, to
Contractor satisfactory evidence of any such payment;

(d) To warrant and guarantee that the work and materials covered by this Subcontract shall be in
accordance with the Contract Documents and agrees to make good, at its expenses, any defect in
materials or workmanship, including the restoration of work of Contractor or other Subcontractors that has
been affected thereby. Subcontractor further agrees that on demand of Contractor, Subcontractor will
furnish and pay for a maintenance bond to indemnify Contractor for any loss that may be caused by
breach of said warranty and guarantee; and, on demand, Subcontractor shall furnish and pay for all
written guarantees and/or maintenance bonds required by the General Contract in connection with the
Work. Unless and until Contractor is released from responsibility by Owner, Contractor may withhold
payment from Subcontractor such sums as, at Contractor discretion, are necessary to protect and
indemnify Contractor for any loss that may be caused by breach of said warranty or guarantee;

(e) To obtain and pay for all permits, licenses and official inspections made necessary by the Work and to
comply with all laws, ordinances and regulations bearing on the Work and the conduct thereof;

(f) To be fully and exclusively responsible for, and to pay when due, any and all applicable contributions,
allowances or other payments or deductions, however termed, required by union labor agreements or
required by law now or hereafter in force;

(g) Subcontractor shall indemnify Contractor against, and save it harmless from any and all loss, damage,
costs, expenses and attorney's fees and expert witness fees suffered or incurred on account of any breach
of the aforesaid obligations and covenants, and any other terms and conditions of this Subcontract and
any dispute arising out of Subcontractor’s performance of the Work. Subcontractor's aforesaid indemnity
and save harmless agreement shall apply to any acts or omissions, or negligent conduct, whether active
or passive, on the part of Contractor or Subcontractor (or their agents, subcontractors or employees);
except that said agreement shall not be applicable to any loss, damage, costs and expenses arising from
the sole negligence or willful misconduct of Contractor , its officers, agents, servants, or independent
contractors of Contractor (other than Subcontractor.) This indemnification agreement shall extend to
claims asserted after termination, for whatever reason, of this Subcontract. At any time before final
settlement or adjudication of any loss, damage, liability, claim, demand, suit or cause of action for which
Subcontractor in this Subcontract agrees to indemnify and save harmless Contractor , Contractor may
withhold from any payments due or to become due under this Subcontract the reasonable value thereof,
as determined solely by Contractor .

SECTION 15. LIENS. In case suit is brought on any claim or lien for labor performed or materials used on
or furnished to the Project arising out of Subcontractor’s work under the Subcontract, Subcontractor shall
pay and satisfy any such lien or judgment as may be established by the decision of the court in said suit.
Subcontractor agrees within ten (10) days after written demand to cause the effect of any such suit or lien
to be removed from the premises, and in the event Subcontractor shall fail to do so, Contractor is
authorized to use whatever means in its discretion it may deem appropriate to cause said lien or suit to be
removed or dismissed and the cost thereof, together with actual attorney’s fees shall be immediately due
and payable to Contractor by Subcontractor. Subcontractor may litigate any such lien or suit provided it
causes the effect thereof to be removed, promptly in advance, from the Premises, and shall further do
such things as may be necessary to cause Owner not to withhold any monies due to Contractor from
Owner by reason of such liens or suits.

SECTION 16. USE OR OCCUPANCY BY CONTRACTOR. Whenever it may be useful or necessary to
Contractor to do so, Contractor may occupy and use any portion of the Work which has been either
partially or fully completed by Subcontractor before final inspection and acceptance thereof by Owner,
but such use or occupancy shall not relieve Subcontractor of its guarantee of the work, material and
equipment nor of its obligation to make good, at its own expense, any defect in materials, equipment and
workmanship which may occur or develop prior to Contractor ’s release from responsibility by Owner.
Provided, however, Subcontractor shall not be responsible for the maintenance of such portion of the work
as may be used or occupied by Contractor, nor for any damage thereto that is due to or caused by the
sole negligence of Contractor during such period of use. Subcontractor agrees further that if it shall cause
any stains, blemishes, imperfections, marks or damage of any sort whatsoever, whether to its work or to the
work of Contractor or to the work of another subcontractor, it will immediately remedy the damage so
caused to the satisfaction of Contractor. Subcontractor further agrees when so required by Contractor to
do any and all cutting and patching necessary in connection with Subcontractor's portion of the work and
agrees further that such cutting and patching shall match other work performed under the General
Contract.

SECTION 17. DAMAGE TO OTHER WORK. The work provided for in this Subcontract constitutes only a
part of the work being performed for Owner by Contractor and other subcontractors. Subcontractor,
therefore, agrees to perform the work called for in this Subcontract in such a manner that it will not injure
or damage any other work performed by Contractor or any other subcontractor, and further agrees to pay
Contractor for any damage that may be caused to such other work by Subcontractor or by its agents or
employees. If the performance of any item of work by Subcontractor is related to or dependent upon any
other item of work performed or materials furnished by others, Subcontractor warrants, by undertaking to
perform his work that such other items are satisfactory and acceptable, and waives all claims against
Contractor for additional compensation or for damages resulting from any defects therein.

SECTION 18. INDEPENDENT CONTRACTOR. Subcontractor represents that it is, or prior to the start of
work hereunder that it will become, an Independent Contractor and an employing unit subject, as an
employer, to all applicable Unemployment Compensation statutes and Federal and State statutes
including Workers' Compensation statutes relating to payroll retention and contributions so as to relieve
Contractor of any responsibility or liability for treating Subcontractor's employees as employees of
Contractor for the purpose of keeping records, making reports and payment of Unemployment
Compensation taxes or contributions or payroll contributions and retentions, and payment of Workers'
Compensation Insurances. Subcontractor agrees to indemnify, defend and hold Contractor harmless and
reimburse it for any expense or liability incurred under said statutes in connection with employees of
Subcontractor, including a sum equal to benefits paid to those who were Subcontractor's employees,
where such benefit payments are charged to Contractor under any Merit Plan or to its individual Reserve
Account pursuant to any State Unemployment Compensation statute or other statute, regulation or
requirement, including Workers' Compensation statutes.

Subcontractor further agrees as regards (a) the production, purchase and sale, furnishing and delivering,
pricing and use or consumption of materials, supplies and equipment, (b) the hire, tenure or conditions of
employment of employees and their hours of work and rates of and the payment of their wages, and (c) the
keeping of records, making of reports, and the payment, collection, and deduction of Federal, State and
Municipal taxes and contributions, that Subcontractor will keep and have available all necessary records
and make all payments, reports, collections and deductions, and otherwise do any and all things so as to
fully comply with all Federal, State and Municipal laws, ordinances and regulations in regard to any and
all said matters insofar as they affect or involve Subcontractor's performance of this Subcontract, all so as
to fully relieve Contractor from and protect it against any and all responsibility or liability therefore or in
regard thereto.

SECTION 19. OWNER'S REPRESENTATIVE. The words "Owner's Representative" as used herein refer to
the person appointed by Owner to supervise the work in behalf of Owner.

SECTION 20. ASSIGNMENT AND SUBLETTING. Any assignment, subletting or delegation, by operation
of law or otherwise, in whole or in part, by Subcontractor of this Subcontract, of the work to be performed
or of any claims arising hereunder without the prior written consent of Contractor shall be void. Contractor
shall not recognize or be bound by any assignment of any right to payment earned or to be earned by
performance hereunder by Subcontractor unless and until Contractor shall receive written notice, which
identifies the proposed assignee and the rights to be assigned. Any assignment hereunder shall be subject
to, and Contractor reserves all rights and remedies possessed by or available to Contractor by law or under
this Subcontract as against Subcontractor, its sureties and assigns, including, without limitation, rights of
set-off, to retain moneys, to amend or modify this Subcontract, and to assert all other defenses and claims
whether or not arising under this Subcontract. The making of any assignment by Subcontractor or any
consent thereto by Contractor shall in no event relieve Subcontractor or its sureties hereunder, of any of
their obligations, duties, responsibilities or liabilities under this Subcontract.
Any subletting hereunder shall be on the express condition that the sub-subcontract shall be subject to the
terms and conditions of this Subcontract and Subcontractor shall incorporate all terms and conditions of
this Subcontract in any such sub-subcontract.

SECTION 21. SAFETY. Subcontractor shall comply fully with all laws, orders, citations, rules, regulations,
standards and statues. With respect to occupational health and safety, accident prevention, safety
equipment and practices, including the accident prevention and safety program of Owner and Contractor.
Subcontractor shall conduct inspections to determine that safe working conditions and equipment exist
and accepts sole responsibility for providing a safe place to work for its employees and for employees of its
subcontractors and suppliers of material and equipment, for adequacy of and required use of all safety
equipment and for full compliance with the aforesaid laws, orders, citations, rules, regulations, standards
and statutes. Subcontractor shall inform Contractor of all reports of injury or claims by its employees or
third parties.

(b) Subcontractor shall provide material safety data sheets and safety program (this must include a
program on Hazardous Communication) to Contractor prior to performing any work. Subcontractor shall
provide evidence that workers are trained in the use of the materials they will use for the work.

(c) Subcontractor shall indemnify, defend and save harmless Contractor , its officers, directors, agents and
employees from claims, penalties, damages, liability, loss, costs, and expenses, including attorneys' fees,
arising from injury or death resulting there from, caused or alleged to have been caused by any violation
or infraction by Contractor or Subcontractor of any law, order, citation, rule, regulations, standard or
statutes in any way relating to the occupational health or safety of employees, including but not limited to
the use of Contractor ’s or other's equipment, hoist, elevators, or scaffolds, unless caused by the sole
negligence or willful misconduct of Contractor .

Subcontractor shall be responsible for and shall defend Contractor against any citations issued against
Contractor and shall indemnify Contractor from any fines, penalties or damages (collectively “fines”)
assessed against Contractor by the Occupational Safety and Health Administration or any similar public
entity (collectively “OSHA”) on account of a Subcontractor violation of one or more occupational safety
and health standards, California Health and Safety Code sections, California Occupational Safety and
Health Regulations, or any other safety orders, special orders and/or regulations which OSHA has cited the
Subcontractor. Subcontractor shall have the right to appeal such citations and/or fines at its sole expense.
Contractor shall cooperate with Subcontractor in its appeal of any citations and/or fines. In the event
Subcontractor either fails to timely appeal the citations and/or fines or the citations and/or fines are
upheld after an appeal hearing, Subcontractor shall promptly pay the Contractor the amount of the fines.

Subcontractor must comply with the Subcontractor’s Safety Procedures which is incorporated herein by
reference as though fully set forth herein.

SECTION 22. LABOR LAWS. Subcontractor agrees to be bound and comply with all applicable labor
laws, regulations and standards issued or promulgated by a federal, state, local or other government
authority having jurisdiction over the Project. Subcontractor further agrees to be bound by and comply
with all applicable Fair Employment Practices and Equal Opportunity Provisions and Regulations of
federal, state or other governmental authority having jurisdiction over the Project. Subcontractor
acknowledges that it has read said laws, regulations, standards and conditions and is familiar with the
terms thereof. Subcontractor agrees that its subcontractors shall observe and be bound by said conditions
to the same extent as herein required of Subcontractor. Where required by either the law or the Contract
documents, Subcontractor shall provide Contractor with certified payrolls for its inspection and records. If
Contractor discovers that Subcontractor has violated any prevailing wage requirements, Contractor shall
retain out of any payments due or to become due Subcontractor an amount sufficient to completely
protect it from any and all loss, damages or expenses there from until the situation has been remedied by
Subcontractor to the satisfaction of Contractor . Subcontractor shall be responsible for and shall defend
Contractor against any claims, penalties and/or assessments made against Contractor and shall indemnify
Contractor from any fines, penalties or damages (collectively “fines”) assessed against Contractor by any
federal, state or local agency or any similar public entity on account of a Subcontractor violation of one
or more applicable Fair Employment Practices and Equal Opportunity Provisions and Regulations of
federal, state or other governmental authority having jurisdiction over the Project, and/or prevailing wage
regulations. Subcontractor shall have the right to appeal any such claims, penalties, assessments and/or
fines at its sole expense. Contractor shall cooperate with Subcontractor in its appeal of any claims,
penalties, assessments, and/or fines. In the event Subcontractor either fails to timely appeal the claims,
penalties, assessments and/or fines or they are upheld after an appeal hearing, Subcontractor shall
promptly pay the Contractor the amount of the fines.

Subcontractor hereby acknowledges that it is thoroughly familiar with all Disadvantaged Business
Enterprise (“DBE”)/Minority Business Enterprise (“MBE”)/Women’s Business Enterprise (“WBE”)/Disabled
Veterans Business Enterprise (“DVBE”) requirements pertaining to the Project. If the Subcontractor claims
status as a DBE/MBE/WBE/DVBE, the Subcontractor shall take all steps necessary and shall make all
necessary records available to Contractor and the Owner to assure that Subcontractor is in compliance
with such requirements. In the even that any sub-subcontractor or supplier of the Subcontractor is
designated as or is required to be a DBE/MBE/WBE/DVBE, Subcontractor agrees to be responsible for
insuring that said sub-subcontractor or supplier meets all applicable requirements. Subcontractor
acknowledges that Contractor is relying upon Subcontractor’s representations regarding the validity of
Subcontractor’s status, if any, as a DBE/MBE/WBE/DVBE, and that misrepresentation of the status of
Subcontractor or any of its sub-subcontractors or material suppliers is a material breach of the
Subcontract and grounds for immediate termination. In the even of termination as the result of material
misrepresentation of the status of the Subcontractor as a DBE/MBE/WBE/DVBE, Subcontractor shall not
be entitled to any compensation not already paid. Subcontractor shall be responsible for and shall defend
Contractor against any claims, penalties and/or assessments made against Contractor and shall indemnify
Contractor from any fines, penalties or damages (collectively “fines”) assessed against Contractor by any
federal, state or local agency or any similar public entity on account of a Subcontractor violation of one
or more DBE/MBE/WBE/DVBE regulations. Subcontractor shall have the right to appeal any such claims,
penalties, assessments and/or fines at its sole expense. Contractor shall cooperate with Subcontractor in
its appeal of any claims, penalties, assessments, and/or fines. In the event Subcontractor either fails to
timely appeal the claims, penalties, assessments and/or fines or they are upheld after an appeal hearing,
Subcontractor shall promptly pay the Contractor the amount of the fines.

SECTION 23. DRAWINGS, PLANS, SPECIFICATIONS. When drawings, plans, specifications, samples or
detail work shall be required by the Subcontract, or shall otherwise be required by Contractor to be
submitted by Subcontractor, whether on account of work required to be done hereunder or on account of
changes in work, Subcontractor agrees to supply the same promptly to Contractor for approval by Owner. If
any such drawings, plans, specifications, samples or detail work as submitted by Subcontractor, whether or
not they shall be approved by Owner, deviate from or are inconsistent with the Contract Documents, and
in the further event that any such deviations or inconsistencies shall cause Contractor to suffer any
damage or incur any cost or expense because of delays or extra work or otherwise, Subcontractor agrees
to reimburse Contractor therefore. If any such damage, cost or expense be imposed upon Contractor,
Contractor may, at its option, withhold from Subcontractor any payments due or to become due to
Subcontractor an amount sufficient fully to reimburse Contractor therefore. The provisions of this
paragraph are cumulative of the remedies provided Contractor by Section 3 of this Subcontract.

SECTION 24. SETTING OF STAKES. Contractor will set such stakes as Contractor determines to be
necessary to establish the lines and grades for the completion of the Work. Subcontractor shall give
Contractor not less than two working days' written notice in advance of the commencement of the
operations of Subcontractor, which required such stakes. Subcontractor shall carefully preserve such
stakes. If such stakes are destroyed or damaged they will be replaced at Contractor’s earliest convenience.
Subcontractor will be charged with the cost of such replacement if, in Contractor’s judgment, the stakes
were negligently or willfully destroyed or damaged by Subcontractor's operations or were destroyed,
damaged or removed by third parties during a delay by Subcontractor in the commencement of its
operations.

SECTION 25. NOTICES. Any notice, where required by the terms of this Subcontract, shall be in writing
and may be served by personal delivery or by mail or any standard form of telegraphic communication.

Personal delivery is complete when the notice is delivered to Subcontractor or its representative at the
Project or at the office address of Subcontractor appearing in the Subcontract. Subcontractor shall at all
times during its work on this Project have a representative authorized to receive written notices present on
the Project site during all normal working hours. In the absence of such a representative, personal delivery
is complete when the notice is delivered to any of Subcontractor's supervisors or workmen, or in their
absence, left in a conspicuous place on the Project site in the area of Subcontractor's work. If notice is
mailed to the Subcontractor, it shall be deemed received three (3) days from the date the notice, with
postage pre-paid, is deposited in the United States Mail System.

SECTION 26. LABOR AGREEMENTS. Subcontractor, to the extent permissible under Federal and any
applicable State laws, shall comply with, observe, and be bound by all the terms and conditions of any
labor agreements executed by Contractor or on Contractor ’s behalf, specifically including the terms and
conditions of such agreements providing (a) for the assignment of work or the settlement of jurisdictional
disputes through the Rules, Regulations and Procedures of the National Joint Board for Settlement of
Jurisdictional Disputes in the Building and Construction Industry or any other agreed method for the
determination of work assignments or the settlement of jurisdictional disputes, (b) for the adjustment of any
other disputes or grievances, (c) for hiring and union-security and (d) for the making of payments into or
under health and welfare or other fringe benefit funds or plans, to the extent that the terms and conditions
of such agreements can legally be applied to the work to be done hereunder. Subcontractor agrees that if
any portion of such work is further subcontract, such sub-subcontractor shall be bound by and observe the
terms and conditions of such agreements to the same extend as is herein required of Subcontractor, and
that any express provision imposing such obligations upon the sub-subcontractor will indemnify, defend
and save Contractor harmless from and against any liability, claim, loss, damage or cause of action
resulting in any way, directly or indirectly, from its failure to comply with the requirements of this
paragraph.

SECTION 27. DEFAULT. If Subcontractor at any time refuses or neglects to supply enough properly skilled
workers and proper materials, or fails to properly and diligently prosecute the Work, or fails to make prompt
payment to its workers, sub-subcontractors or suppliers or becomes delinquent with respect to contributions
or payments required to be made to any health and welfare, pension, vacation, apprenticeship or other
employee benefit program or trust, or fails to provide adequate assurance pursuant to Section 8 or is
otherwise guilty of a material breach of a provision of the Subcontract, and fails within forty-eight (48)
hours after receipt of written notice to commence and continue satisfactory correction of such default
with diligence and promptness, then Contractor , without prejudice to any rights or remedies, shall have to
right to any or all of the following remedies.

(a) supply such number of workers and quantity of materials, equipment (including use of subcontractors
equipment) and other facilities as Contractor deems necessary for the completion of Subcontractor’s work,
or any part thereof which Subcontractor has failed to complete or perform, and charge the cost thereof to
Subcontractor, who shall be liable for the payment of same including reasonable overhead, profit, and
actual attorney’s fees incurred as a result of Subcontractor’s failure of performance;

(b) contract with one or more additional contractors to perform such part of Subcontractor’s work as
Contractor shall determine will provide the most expeditious completion of the total work and charge the
cost thereof to Subcontractor including reasonable overhead, profit, and actual attorney’s fees incurred as
a result of Subcontractor’s failure of performance;

(c) withhold payment of any monies due Subcontractor pending corrective action to the extent required
by and to the satisfaction of Contractor.

In the event of an emergency affecting the safety of persons or property, Contractor may proceed as
above without notice to Subcontractor.

If Subcontractor fails to commence and satisfactorily continue correction of a default within forty-eight
(48) hours after receipt by Subcontractor of the notice issued above, then Contractor may terminate
Subcontractor’s right to perform under the Subcontract and use any materials, implements, equipment,
appliances or tools furnished by or belonging to Subcontractor to complete Subcontractor’s work without
any further compensation to Subcontractor for such use. In such case, Subcontractor shall be entitled to
no further payment until the balance of Subcontractor’s work has been completed. At that time all of the
costs incurred by Contractor in performing Subcontractor’s work, including reasonable overhead, profit,
and actual attorney’s fees incurred shall be deducted from any monies due or to become due
Subcontractor. Subcontractor shall be liable for the payment of any amount by which such expenses may
exceed the unpaid balance of the Subcontract price.

SECTION 28. SEVERABILITY. To the best knowledge and belief of the parties, this Subcontract now
contains no provision that is contrary to Federal or to State law or any ruling or regulation of a Federal or
State agency. Should, however, any provision of this Subcontract at any time during its term be in
conflict with any such law, ruling or regulation, then such provision shall continue in effect only to the
extent permitted. If any provision of this Subcontract is thus held inoperative, the remaining provisions of
this Subcontract shall nevertheless remain in full force and effect to the extent permitted by law.

SECTION 29. CLEAN UP. Upon termination or completion of its work, Subcontractor agrees to remove all
unused materials and all equipment, utilities and facilities furnished by Subcontractor, to clean up all
refuse and debris, and to leave the premises clean, orderly and in good condition.

SECTION 30. NON-WAIVER. Waiver by Contractor of any breach hereof by Subcontractor shall not
constitute a waiver of any subsequent breach of the same or any other provision hereof. If any provision of
this Subcontract, or any part thereof, shall at any time be held to be invalid, in whole or in part, under any
applicable Federal, State, Municipal or other law, ruling or regulation, then such provision shall remain in
effect to the extent permitted, and the remaining provisions hereof shall remain in full force and effect.

SECTION 31. ENTIRE SUBCONTRACT. This Subcontract along with any documents incorporated by
reference herein contains all covenants, stipulations and conditions agreed upon by the parties hereto.
No agent or representative of either party has authority to make, and the parties shall not be liable for, any
statement, representation, promise or agreement not set forth herein. Any changes, amendments or
modifications of this Subcontract must be made in writing and signed by both parties. Words used in this
Subcontract in the present tense include the future as well as the present; words used in the masculine
gender include the feminine and neuter; the singular number includes the plural and the plural the
singular.

SECTION 32. APPLICABLE LAW. The definitions of terms used, interpretation of this Agreement and the
rights of all parties hereunder, shall be construed under and governed by the laws of the State of
California. The parties agree that venue for any action to enforce any obligation arising under the
Subcontract shall be Alameda County, State of California.

SECTION 33. BINDING ON SUCCESSORS. Subject to the terms of Section 20 above, The terms and
conditions of this Subcontract shall inure to and be binding upon the parties hereto, and their successors,
assigns, executors, administrators, agents and legal representatives.

SECTION 34. SECTION TITLES. Section Titles in the Subcontract are for convenience only and shall
not be construed to modify, expand or limit the provisions of the section to which they refer.

Additional Provisions: (If space not adequate, attach additional pages, which by this reference are made
a part of this Subcontract.)

ATTACHMENTS ARE HEREBY MADE A PART OF THIS SUBCONTRACT.

CONTRACTORS ARE REQUIRED BY LAW TO BE LICENSED AND REGULATED BY THE
CONTRACTORS' STATE LICENSE BOARDS. ANY QUESTIONS CONCERNING A CONTRACTOR MAY
BE REFERRED TO THE REGISTRAR OF THE BOARD WHOSE ADDRESS IS:

CONTRACTORS' STATE LICENSE BOARD
P. O. BOX 26000
3132 BRADSHAW ROAD
SACRAMENTO, CA 95826

IN WITNESS WHEREOF, the parties hereto have executed this Subcontract by their proper officers or duly
authorized agents.

Contractor: Subcontractor:

Diablo Contractors, Inc. XXXXXXXXXXXXXXXX

By:____________________________________ By:____________________________________
Name/Title Name/Title

Date: Date:

Address: 7 Crow Canyon Court, Suite 100 Address:
San Ramon, CA 94583

Telephone: 925-552-8250 Telephone: XXX-XXX-XXXX
Fax No: 925-552-8254 Fax: XXX-XXX-XXXX
Contractor’s License Number: 732283 Contractor’s License Number: