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17-060 Reax Engineering, Inc., Apple Campus 2 Fire Protection System Third Party Peer Review ServicesAGREEMENT BETWEEN THE CITY OF CUPERTINO AND REAX ENGINEERING, INC. FOR APPLE CAMPUS 2 FIRE PROTECTION SYSTEM THIRD PARTY PEER REVIEW SERVICES THIS AGREEMENT, is entered into this thirteenth day of October, 2016, by and between the CITY OF CUPERTINO , a California municipal corporation ("City"), and Reax Engineering, Inc., a California Corporation whose address is 1921 University Avenue, Berkley, CA 94704 (hereinafter referred to as "Consultant") (collectively referred to as the "Parties"). RECITALS: A. City is a municipal corporation duly organized and validly existing under the laws of the State of California with the power to carry on its business as it is now being conducted under the Constitution and the statutes of the State of California and the Cupertino Municipal Code. B. Consultant is specially trained , experienced and competent to perform the special services which will be required by this Agreement. C. Consultant possesses the skill , experience, ability, background , certification and knowledge to provide the services described in this Agreement on the terms and conditions described herein. D. City and Consultant desire to enter into an agreement for third party peer review services for water mist fire protection system at Apple Campus 2 upon the terms and conditions herein. NOW , THEREFORE, the Parties mutually agree as follows: 1. TERM The term of this Agreement shall commence on October 1, 2016, and shall terminate on December 31 , 2018, unless terminated earlier as set forth herein. 2. SERVICES TO BE PERFORMED Consultant shall perform each and every service set forth in Exhibit "A" pursuant to the schedule of performance set forth in Exhibit "B," attached hereto and incorporated herein by this reference. 3. COMPENSATION TO CONSULTANT Consultant shall be compensated for services performed pursuant to this Agreement in a total amount not to exceed seven thousand and five hundred dollars ($7,500.00) based on the rates and terms set forth in Exhibit "C ," which is attached hereto and incorporated herein by this reference. 4 . TIME IS OF THE ESSENCE Consultant and City agree that time is of the essence regarding the performance of this Agreement. Page I of 13 REAX Engineering for AC2 , 10 .13 .16 5. STANDARD OF CARE Consultant agrees to perform all services required by this Agreement in a manner commensurate with the prevailing standards of like professionals in the San Francisco Bay Area and agrees that all services shall be performed by qualified and experienced personnel who are not employed by the City nor have any contractual relationship with City. 6 . INDEPENDENT PARTIES City and Consultant intend that the relationship between them created by this Agreement is that of independent contractor. The manner and means of conducting the work are under the control of Consultant, except to the extent they are limited by statute , rule or regulation and the express terms of this Agreement. No civil service status or other right of employment will be acquired by virtue of Consultant's services. None of the benefits provided by City to its employees, including but not limited to, unemployment insurance, workers' compensation plans , vacation and sick leave are available from City to Consultant, its employees or agents . Deductions shall not be made for any state or federal taxes, FICA payments, PERS payments , or other purposes normally associated with an employer-employee relationship from any fees due Consultant. Payments of the above items , if required , are the responsibility of Consultant. 7 . IMMIGRATION REFORM AND CONTROL ACT {IRCA) Consultant assumes any and all responsibility for verifying the identity and employment authorization of all of his/her employees performing work hereunder, pursuant to all applicable IRCA or other federal , or state rules and regulations. Consultant shall indemnify and hold City harmless from and against any loss , damage, liability, costs or expenses arising from any noncompliance of this provision by Consultant. 8. NON-DISCRIMINATION Consistent with City's policy prohibiting harassment and discrimination , Consultant agrees that it shall not harass or discriminate against a job applicant, a City employee, or a citizen by Consultant or Consultant's employee or subcontractor on the basis of race , religious creed , color, national origin , ancestry, handicap , disability, marital status , pregnancy, sex , age , sexual orientation , or any other protected class . Consultant agrees that any and all violations of this provision shall constitute a material breach of this Agreement. 9. HOLD HARMLESS ~ Standard Indemnification: Consultant shall , to the fullest extent allowed by law and without limitation of the provisions of this Agreement related to insurance , with respect to all services performed in connection with the Agreement, indemnify, defend , and hold harmless the City and its officers , officials , agents , employees and volunteers from and against any and all liability, claims , actions , causes of action or demands whatsoever against any of them , including any injury to or death of any person or damage to property or other liability of any nature , whether physical , emotional , consequential or otherwise, arising out, pertaining to, or related to the negligent performance of this Agreement by Consultant or Consultant's employees , officers , officials , agents or independent contractors . Such costs and expense s shall include reasonable attorneys' fees of counsel of City's choice, expert fees and all other costs and fees of litigation. The acceptance of the Services by City shall not operate Page 2 of 13 REN< Engineering for AC2 , 10.13.16 as a waiver of the right of indemnification. The provisions of this Section survive the completion of the Services or termination of this Contract. 10. INSURANCE: A. General Requirements . On or before the commencement of the term of this Agreement, Consultant shall furnish City with certificates showing the type , amount, class of operations covered, effective dates and dates of expiration of insurance coverage in compliance with the requirements listed in Exhibit "D". Such certificates , which do not limit Consultant's indemnification , shall also contain substantially the following statement: "Should any of the above insurance covered by this certificate be canceled or coverage reduced before the expiration date thereof, the insurer affording coverage shall provide thirty (30) days' advance written notice to the City of Cupertino by certified mail, Attention: City Manager." Consultant shall maintain in force at all times during the performance of this Agreement all appropriate coverage of insurance required by this Agreement with an insurance company that is acceptable to City and licensed to do insurance business in the State of California. Endorsements naming the City as additional insured shall be submitted with the insurance certificates. B. Subrogation Waiver. Consultant agrees that in the event of loss due to any of the perils for which he /she has agreed to provide comprehensive general and automotive liability insurance, Consultant shall look solely to his/her insurance for recovery. Consultant hereby grants to City, on behalf of any insurer providing comprehensive general and automotive liability insurance to either Consultant or City with respect to the services of Consultant herein , a waiver of any right to subrogation which any such insurer of said Consultant may a cquire against City b y virtue of the payment of any loss under such insurance. C . Failure to secure or maintain insurance. If Consultant at any time during the term hereof should fail to secure or maintain the foregoing insurance, City shall be permitted to obtain such insurance in the Consultant's name or as an agent of the Consultant and shall be compensated by the Consultant for the costs of the insurance premiums at the maximum rate permitted by law and computed from the date written notice is received that the premiums have not been paid . D. Additional Insured. City, its City Council , boards and commissions, officers, employees and volunteers shall be named as an additional insured under all insurance coverages, except any professional liability insurance, required by this Agreement. The naming of an additional insured shall not affect any recovery to which such additional insured would be entitled under this policy if not named as such additional insured. An additional insured named herein shall not be held liable for any premium , deductible portion of any loss , or expense of any nature on this policy or any extension thereof. Any other insurance held by an additional insured shall not be required to contribute anything toward any loss or expense covered by the insurance provided by this policy. E. Sufficiency of Insurance . The insurance limits required by City are not represented as being sufficient to protect Consultant. Consultant is advised to confer with Consultant's insurance broker to determine adequate coverage for Consultant. F . Maximum Coverage and Limits. It shall be a requirement under this Agreement that an y available insurance proceeds broader than or in excess of the specified minimum Insurance coverage requirements and/or limits shall be available to the additional Page 3 of 13 REAX Engineering for AC2 , 10 .13 .16 insured City. Furthermore, the requirements for coverage and limits shall be the minimum coverage and limits specified in this Agreement, or the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to the named insured , whichever is greater. 11. CONFLICT OF INTEREST Consultant warrants that it presently has no interest, and will not acquire any interest, direct or indirect , financial or otherwise, that would conflict in any way with the performance of this Agreement, and that it will not employ any person having such an interest. Consultant agrees to advise City immediately if any conflict arises and understands that it may be required to fill out a conflict of interest form if the services provided under this Agreement require Consultant to make certain governmental decisions or serve in a staff capacity as defined in Title 2 , Division 6 , Section 18700 of the California Code of Regulations. 12. PROHIBITION AGAINST TRANSFERS Consultant shall not assign , sublease, hypothecate , or transfer this Agreement, or any interest therein , directly or indirectly , by operation of law or otherwise, without prior written consent of City. Any attempt to do so without said consent shall be null and void , and any assignee, sub lessee , hy pothecate or transferee shall acquire no right or interest by reason of such attempted assignment, hypothecation or transfer. However, claims for money by Consultant from City under this Agreement may be assigned to a bank, trust company or other financial institution without prior written consent. Written notice of such assignment shall be promptly furnished to City by Consultant. The sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of Consultant, or of the interest of an y general partner or joint venturer or syndicate member or cotenant, if Consultant is a partnership or joint venture or syndicate or cotenancy, which shall result in changing the control of Consultant, shall be construed as an assignment of this Agreement. Control means fifty percent (50%) or more of the voting power of the corporation. 13. SUBCONTRACTOR APPROVAL Unless prior written consent from City is obtained, only those people and subcontractors whose names and resumes are attached to this Agreement shall be used in the performance of this Agreement. In the event that Consultant employs subcontractors, such subcontractors shall be required to furnish proof of workers' compensation insurance and shall also be required to carry general , automobile and professional liability insurance in reasonable conformity to the insurance carried by Consultant. In addition , any work or services subcontracted hereunder shall be subject to each provision of this Agreement. Consultant agrees to include with all subcontractors in their subcontract the same requirements and provisions of this Agreement including the indemnity and insurance requirements to the extent they apply to the scope of the subcontractor's work. Subcontractors hired by Consultant agree to be bound to Consultant and City in the same manner and to the same extent as Consultant is bound to City under this Agreement. Subcontractor further agrees to include these same provisions with any sub-subcontractor. A copy of the Owner Contract Document Indemnity and Insurance provisions will be Page 4 of 13 REAX Engineering for AC 2 , 1 0 . 13 .16 furnished to the subcontractor upon request. Consultant shall require a ll subcontractors to provide a valid ce11ificate of insurance and the required endorsements included in the agreement prior to commencement of any work and will provide proof of compliance to City. 14 . PERMITS AND LICENSES Consultant, at his /her sole expense, shall obtain and maintain during the term of this Agreement, all appropriate permits, certificates and licenses including, but not limited to, a City Business License, that may be required in connection with the performance of services hereunder. 15. REPORTS A . Each and every report, draft, work product, map , record and other document, hereinafter collectively referred to as "Report", reproduced , prepared or caused to be prepared by Consultant pursuant to or in connection with this Agreement, shall be the exclusive property of City. Consultant shall not copyright any Report required by this Agreement and shall execute appropriate documents to assign to City the copyright to Reports created pursuant to this Agreement. Any Report, information and data acquired or required by this Agreement shall become the property of City, and all publication rights are reserved to City. Consultant may retain a copy of any report furnished to the City pursuant to this Agreement. B. All Reports prepared by Consultant may be used by City in execution or implementation of: ( 1) The original Project for which Consultant was hired; (2) Completion of the original Project by others ; (3) Subsequent additions to the original project; and /or (4) Other City projects as City deems appropriate . C . Consultant shall , at such time and in such form as City may require , furnish reports concerning the status of services required under this Agreement. D. All Reports required to be provided by this Agreement shall be printed on recycled paper. All Reports shall be copied on both sides of the paper except for one original, which shall be single sided . E . No Report, information or other data given to or prepared or assembled by Consultant pursuant to this Agreement shall be made available to any individual or organization by Consultant without prior approval by City. 16. RECORDS Consultant shall maintain complete and accurate records with respect to sales , costs , expenses, receipts and other such information required by City that relate to the performance of services under this Agreement, in sufficient detail to permit an evaluation of services . All such records shall be maintained in accordance with generally accepted accounting principles and shall be clearly identified and readily accessible . Consultant shall provide free access to such books and records to the representatives of City or its designees at all proper times, and gives City the right to examine and audit same , and to make transcripts therefrom as necessary , and to allow inspection of all work, data, documents , proceedings and activities related to this Agreement. Such records , together with supporting documents , shall be kept separate from other documents and records and shall be maintained for a period of three (3) years after Consultant receives final payment from City for all services required under this agreement. Page 5 of 13 REAX Engineering for AC2 , 10 .13 .16 If supplemental examination or audit of the records is necessary due to concerns raised by City's preliminary examination or audit of records , and the City's supplemental examination or audit of the records discloses a failure to adhere to appropriate internal financial controls , or other breach of contract or failure to act in good faith , then Consultant shall reimburse City for all reasonable costs and expenses associated with the supplemental examination or audit. 17. NONAPPROPRIATION This Agreement is subject to the fiscal provisions of the Cupertino Municipal Code and Agreement will terminate without any penalty (a) at the end of any fiscal year in the event that funds are not appropriated for the following fiscal year, or (b) at any time within a fiscal year in the event that funds are only appropriated for a portion of the fiscal year and funds for this Agreement are no longer available. This Section shall take precedence in the event of a conflict with any other covenant, term , condition, or provision of this Agreement. 18 . ENVIRONMENTALLY PREFERABLE PURCHASING Consultant shall comply with the City's Environmentally Preferable Procurement Policy whenever practicable in completing any work under this agreement, including but not limited to: • Using paper products made with recycled content and recycled/remanufactured toner and ink jet cartridges; • Printing with soy or low volatile organic compounds (VOC) inks ; • Using energy-star compliant equipment; • Using cleansers and working with janitorial contractors to meet Green Seal's Industrial and Institutional Cleaners Standard ; and • Ordering supplies electronically and practicing other internal waste reduction and reuse protocols. 19. NOTICES All notices , demands , requests or approvals to be given under this Agreement shall be given in writing and conclusivel y shall be deemed served when delivered personally or on the second business day after the deposit thereof in the United States Mail , postage prepaid , registered or certified , addressed as hereinafter provided. All notices , demands , requests , or approvals shall be addressed as follow s : TO CITY: City of Cupertino I 0300 Torre Ave. Cupertino CA 95014 Attention: Albert Salvador, Building Official TO CONSULTANT: David Rich Reax Engineering, Inc . 1921 University A venue Berkeley, CA 94704 REAX Engineering for AC2 , 10 .13 .16 Page 6 of 13 20. TERMINATION In the event Consultant fails or refuses to perform any of the provisions hereof at the time and in the manner required hereunder, Consultant shall be deemed in default in the performance of this Agreement. If Consultant fails to cure the default within the time specified and according to the requirements set forth in City's written notice of default, and in addition to any other remedy available to the City by law, the City Manager may terminate the Agreement by giving Consultant written notice thereof, which shall be effective immediately. The City Manager shall also have the option , at its sole discretion and without cause , of terminating this Agreement by giving seven (7) calendar days' prior written notice to Consultant as provided herein. Upon receipt of any notice of termination, Consultant shall immediately discontinue performance . City shall pay Consultant for services satisfactorily performed up to the effective date of termination. If the termination is for cause, City may deduct from such payment the amount of actual damage , if any, sustained by City due to Consultant's failure to perform its material obligations under this Agreement. Upon termination , Consultant shall immediately deliver to the City any and all copies of studies, sketches , drawings , computations , and other material or products, whether or not completed, prepared by Consultant or given to Con s ultant, in connection with this Agreement. Such materials shall become the property of City. 21. COMPLIANCE Consultant shall comply with all state or federal laws and all ordinances, rul e s , policies and regulations enacted or issued by City. 22 . CONFLICT OF LAW This Agreement shall be interpreted under, and enforced by the laws of the State of California excepting any choice of law rules which may direct the application of laws of another jurisdiction. The Agreement and obligations of the parties are subject to all valid laws, orders, rules , and regulations of the authorities having jurisdiction over this Agreement ( or the successors of those authorities). Any suits brought pursuant to this Agreement shall be filed with the Superior Court of the County of Santa Clara, State of California. 23. ADVERTISEMENT Consultant shall not post, exhibit, display or allow to be posted , exhibited , displayed any signs , advertising, show bills , lithographs, posters or cards of any kind pertaining to the services performed under this Agreement unless prior written approval has been secured from City to do otherwise . 24. WAIVER A waiver by City of any breach of any term , covenant, or condition contained herein shall not be deemed to be a waiver of any subsequent breach of the same or any other term , covenant, or condition contained herein , whether of the same or a different character. 25. INTEGRATED CONTRACT Page 7 of 13 REAX Engineering for AC2 , 10 .13 .16 This Agreement represents the full and complete understanding of every kind or nature whatsoever between the Parties, and all preliminary negotiations and agreements of whatsoever kind or nature are merged herein. No verbal agreement or implied covenant shall be held to vary the provisions hereof. Any modification of this Agreement will be effective only by written execution signed by both City and Consultant. 26 . AUTHORITY The individual(s) executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. 27 . INSERTED PROVISIONS Each provision and clause required by law to be inserted into the Agreement shall be deemed to be enacted herein , and the Agreement shall be read and enforced as though each were included herein. If through mistake or otherwise, any such provision is not inserted or is not correctly inserted , the Agreement shall be amended to make such insertion on application by either party . 28 . CAPTIONS AND TERMS The captions in this Agreement are for convenience only, are not a part of the Agreement and in no way affect, limit or amplify the terms or provisions of this Agreement. All unchecked boxes do not apply to this Agreement. IN WITNESS WHEREOF , the parties have caused the Agreement to be executed . CITY OF CUPERTINO D Over $175 ,0 0-o ncil Ap proval Required D O ve r $45 ,000 -Departm ent Head Approval Required APPROVED AS TO FORM: ~ Up to $45,00 0-De s ign ated Su pe rv isor Ap proval Required ~Ci ~:L RECOMMENDED FOR APPROVAL J&~~al ~JJ- City Clerk $"'i)_ -( 7 Page 8 of 13 REAX Engineering for AC2 , 10 .13 .16 Exhibits: (C heck box for ex hibi ts that app ly to this contract and attac h) ~ Exhibit "A"-Scope of Services ~ Exhibit "B"-Schedule of Performance ~ Exhibit "C"-Compensation ~ Exhibit "D"-Insurance Requirements and Proof of Insurance D Exhibit "E"-Mandated Reporting Acknowledgement D Exhibit "F"-Background/Fingerprint/TB Declaration D Exhibit "G"-Nondiscrimination-State/Fe deral/HUD funded project D Exhibit "H" -Request for City Manager to Waive Informal Bidding Requirements EXPENDITURE DISTRIBUTION ACCOUNT NUMBER AMOUNT PO #2017-SD~ Account: 100-73-714 900-923 Amount: $7,500.00 Total: $7,500.00 9 Exhibit A Scope of Services Third Party Peer Review of Fire Suppression Systems at Apple Campus 2 A key aspect of the fire strategy is the subdivision of the building into several fire compartments via 2-hour fire barriers. This approach assists in economizing the number of required exit stairs by providing exiting into adjacent fire compartments via horizontal exits, while also improving occupant and fire fighter life safety ; and minimizing property losses by containing fire /smoke to a single compartment in the event of fire. Original work scope was divided into two phases as follows: I. Design and Review Process -In consultation with the City and County, Design Team , test facility and mist system manufacturer, agree on a test protocol , respond to questions, facilitate acceptable solutions to all parties , and issue a test protocol approval letter. 2. Witness Testing -Review test setup, witness tests, review fire test report, discuss results with the City and County, review and approve alternate method of design. Item I above is complete and a few outstanding elements from Item 2 are addressed in this updated scoping document. Detailed Scope of Work The item below was originally included in Point 4 of the Sub-section of detailed scope titled "Witness and Report on Fire Testing". Review is required for some conditions which deviate from the original fire test and thereby require additional engineering assessments to verify that these deviations will provide a similar level of protection as originally intended in the mist system design. Each evaluation requires a series of consultations with the architect and fire safety engineer with a follow on letter describing the modification or change and whether it complies with the acceptance conditions of the alternate method of compliance. 10 REAX EN GIN EE R ING 1921 University Avenue• Berkeley, CA 94704 • Phone 510-629-4930 Ext. 802 • Fax 510-550-2639 David Rich rich@reaxengineering.com October 7, 2016 Albert Salvador Building Official City Of Cupertino 10301 Vista Dr Cupertino, California 95014 (408) 252-3000 Subject: Proposal for extension of 3 rd Party Peer Review services (original contract dated May 10 1\ 2013), Water Mist Fire Protection System -AC2 Campus. Dear Ms. Lattanzi City of Cupertino Management Analyst Community Development 10300 Torre Avenue Cupertino, CA 95014: Reax Engineering Inc. is pleased to offer this proposal for continued review and development of an alternate to standard fire resistance, inclusive of a fire test and application of mist suppression system technology for the horizontal exits and exit stair enclosures for the Apple Campus 2 (AC2) project located in Cupertino, CA. Work to date has included review and development of a fire test which supports an Alternate Method of Compliance (AMC) under Section I 04.11 of the 2010 California Building Code offered in lieu of the published referenced tests to demonstrate the intent of the code has been met. The test supports use of a mist fire suppression system to protect several glazed openings at strategic locations of the horizontal exits and exit stair enclosures in the above grade levels of the Main Building in the AC2 project. The third party peer reviewer has been acting as a consultant on behalf of the City and County to review the proposed test protocol , witness the test, review the alternate method of compliance report and provide advice during the process. Following completion of the fire test program , the peer reviewer has been responding to comments both written and verbal , and providing documentation approving appropriate submittals as required . This phase of work is ongoing and requires additional time to complete which carries the anticipated timeline and budget beyond the original proposal. Scope is unchanged with respect to the review and documentation related to submittal s. This proposal outlines scope, timeline and budget to meet the requirements as requested by the City of Cupe1tino to fulfill this outstanding phase of work and has been prepared in accordance with the requirements set forth in the city 's original "AC2 Request for Proposal: Fire Resistance Alternate Method of Design Peer Review", dated December 19 1 \ 2012 (Contract date May 10th 20 I 3). Scope is developed with reference the Society of Fire Protection Engineers (SFPE) "Guidelines for Peer Review in the Fire Protection Design Process. " Scope of Work A key aspect of the fire strategy is the subdivision of the building into several fire compartments via 2-hour fire barriers. This approach assists in economizing the number of required exit stairs by providing exiting into adjacent fire compartments via horizontal exits, while also improving occupant and fire fighter life safety; and minimizing property losses by containing fire /smoke to a single compartment in the event of fire. Original work scope was divided into two phases as follows: 1. Design and Review Process -In consultation with the City and County, Design Team, test facility and mist system manufacturer, agree on a test protocol , respond to questions , facilitate acceptable solutions to all parties, and issue a test protocol approval letter. 2. Witness Testing -Review test setup , witness tests , review fire test report , discus s results with the City and County, review and approve alternate method of design. Item above is complete and a few outstanding elements from Item 2 are addressed in this updated scoping document. Detailed Scope of Work The item below was originally included in Point 4 of the Sub-section of detailed scope titled "Witness and Report on Fire Testing". I. Review final alternate method of design which includes the test report and any other proposed fire safety measures necessary to meet the intent of the code for protection of fire and smoke spread. Review is required for some conditions which deviate from the original fire test and thereby require additional engineering assessments to verify that these deviations will provide a similar level of protection as originally intended in the mist system desi gn . Each evaluation requires a series of consultations with the architect and fire safety engineer with a follow on letter describing the modification or change and whether it complies with the acceptance condition s of the alternate method of compliance. Schedule Certificate of occupancy is anticipated before the end of 2018 which would typically be the termination point for any further required engineering assessments. Cost Estimate 2 Costs will be incurred on an hourly basis using Reax Engineering's "design " rate of $250 per hour. This rate is reflective of changes to hourly billing rate from the date ofthe original proposal in 2013. While no clear indication is given of outstanding items to be reviewed as part of the scoping item above, time commitment is not expected to e xceed 30 hours for a total of $7500 . Deliverables I. Draft and final letters of approval for outstanding engineering judgements as part of the original alternate method of design. Personnel Personnel for this project are as follows (CV's enclosed): • Project manager/principal engineer -David Rich, PhD • Reviewing Engineer -Christopher Lautenberger, PhD, FPE Terms and conditions Payment terms are Net 30 . Invoices will be submitted monthly based on hours worked. Reimbursable expenses will be billed at cost. The terms of this proposal remain binding for 30 day s. We look forward to working with you . Sincerely, David B. Rich , PhD 3 Exhibit B Schedule of Performance Certificate of occupancy is anticipated before the end of 2018 which would typically be the termination point for any further required engineering assessments. Costs will be incurred on an hourly basis using Reax Engineering's "design" rate of $250 per hour. This rate is reflective of changes to hourly billing rate from the date of the original proposal in 2013. While no clear indication is given of outstanding items to be reviewed as part of the scoping item above, time commitment is not expected to exceed 30 hours for a total of $7500. I I Exhibit C Compensation City shall compensate Consultant for professional services in accordance with the terms and conditions of this Agreement based on the rates and compensation schedule set forth below . Compensation shall be calculated based on the hourly rates set forth below up to the not to exceed budget amount set forth below. The compensation to be paid to Consultant under this Agreement for all services described in Exhibit "A" and reimbursable expenses shall not exceed a total of seven thousand and five hundred dollars ($7 ,500 .00), as set forth below . Any work performed or expenses incurred for which payment would result in a total exceeding the maximum amount of compensation set forth herein shall be at no cost to the City . Task Fire Suppression System Review Total Rates Not to Exceed Amount $7 ,500.00 $7,500.00 Reax Engineering, Inc Design Rate -$250 .00 per hour Invoices IZI Monthly Invoicing: In order to request payment, Consultant shall submit monthly invoices to the CITY describing the services performed and the applicable charges (including a summary of work performed during that period , personnel who performed the services , hours worked , task(s) for which work was performed). Reimbursable Expenses Administrative , overhead , secretarial time or overtime, word processing, photocopying, in house printing, insurance and other ordinary business expenses are included within the scope of payment for services and are not reimbursable expenses. Travel expenses must be authorized in advance and shall only be reimbursed to the extent consistent with City travel policy . Additional Services Consultant shall provide additional services outside of the services identified in Exhibit A only by advance written authorization from the City's Project Manager prior to commencement of any additional services . Consultant shall submit, at the Project Manager's request, a detailed written proposal including a description of the scope of additional services , schedule, and proposed maximum compensation . 12 Exhibit D Insurance Requirements and Proof of Insurance Proof of insurance coverage described below is attached to this Exhibit, with City named as additional insured. Consultant shall maintain the following minimum insurance coverage: A . COVERAGE: (1) Workers' Compensation: Statutory coverage as required by the State of California. (2) Liability: Commercial general liability coverage in the following minimum limits: Bodily Injury: $500,000 each occurrence $1 ,000,000 aggregate -all other Property Damage: $100,000 each occurrence $250,000 aggregate If submitted, combined single limit policy with aggregate limits in the amounts of$ 1,000 ,000 will be considered equivalent to the required minimum limits shown above . (3) Automotive: (4) Comprehensive automotive liability coverage in the following minimum limits: Bodily Injury: $500,000 each occurrence Property Damage: $100,000 each occurrence or Combined Single Limit: $500,000 each occurrence Professional Liability Professional liability insurance which includes coverage for the professional acts , errors and omissions of Consultant in the amount of at least $1 ,000 ,000. 13 The ACORD name and logo are registered marks of ACORD CERTIFICATE HOLDER ©1988-2014 ACORD CORPORATION.All rights reserved. ACORD 25 (2014/01) AUTHORIZED REPRESENTATIVE CANCELLATION DATE (MM/DD/YYYY)CERTIFICATE OF LIABILITY INSURANCE LOCJECTPRO-POLICY GEN'L AGGREGATE LIMIT APPLIES PER: OCCURCLAIMS-MADE COMMERCIAL GENERAL LIABILITY PREMISES (Ea occurrence)$DAMAGE TO RENTED EACH OCCURRENCE $ MED EXP (Any one person)$ PERSONAL &ADV INJURY $ GENERAL AGGREGATE $ PRODUCTS - COMP/OP AGG $ $RETENTIONDED CLAIMS-MADE OCCUR $ AGGREGATE $ EACH OCCURRENCE $UMBRELLA LIAB EXCESS LIAB DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached if more space is required) INSR LTR TYPE OF INSURANCE POLICY NUMBER POLICY EFF(MM/DD/YYYY)POLICY EXP(MM/DD/YYYY)LIMITS PER STATUTE OTH- ER E.L.EACH ACCIDENT E.L. DISEASE - EA EMPLOYEE E.L. DISEASE - POLICY LIMIT $ $ $ ANY PROPRIETOR/PARTNER/EXECUTIVE If yes,describe under DESCRIPTION OF OPERATIONS below (Mandatory in NH) OFFICER/MEMBER EXCLUDED? 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THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). COVERAGES CERTIFICATE NUMBER:REVISION NUMBER: INSURED PHONE (A/C, No, Ext): PRODUCER ADDRESS: E-MAIL FAX (A/C, No): CONTACT NAME: NAIC # INSURER A : INSURER B : INSURER C : INSURER D : INSURER E : INSURER F : INSURER(S)AFFORDING COVERAGE SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. INS025 (201401) 11/8/2016 Insurance Solutions License #0746539 33302 Valle Rd, Suite 200 San Juan Capistrano CA 92675 Staci Thistlewhite (949)348-7400 (949)348-2373 StaciT@ins-solutions.com Reax Engineering, Inc. 2342 Shattuck Ave #127 Berkeley CA 94704 Lloyds of London 32727 16-17 All A X X X PSE03187978 5/18/2016 5/18/2017 2,000,000 250,000 5,000 2,000,000 4,000,000 2,000,000 A X X PSE03187978 5/18/2016 5/18/2017 2,000,000 A Errors & Omissions PSE03187978 5/18/2016 5/18/2017 Limit: $2,000,000 Ded: $5,000 Aggregate: $2,000,000 Re: Apple Campus 2 @ Cupertino, CA Certificate Holder is included as additional insured. Waiver of Subrogation wording on attached policy form (pg.11). T Alessandra/PETERS City of Cupertino Attn: Ariel Maria Lattanzi 10300 Torre Avenue Cupertino, CA 95014 AriL@cupertino.org PREAMBLE INSURING CLAUSES INSURING CLAUSE 1: ERRORS & OMISSIONS SECTION A: PROFESSIONAL LIABILITY We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim first made against the company named as the Insured in the Declarations or any subsidiary and notified to us during the period of the policy arising out of any: a) negligent act, error or omission, negligent misstatement or negligent misrepresentation; b) breach of any contractual term implied by law concerning necessary quality, safety or fitness, or your duty to use reasonable care and skill; c) breach of warranty of authority, breach of duty, breach of trust, breach of confidence, misuse of information or breach of privacy; d) libel, slander or defamation; e) other act, error or omission giving rise to civil liability to your clients but not any breach of contract save as specified above; committed by you or on your behalf in the course of your business activities. We will also pay costs and expenses on your behalf. SECTION B: BREACH OF CONTRACT We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim by a client first made against the company named as the Insured in the Declarations or any subsidiary and notified to us during the period of the policy arising out of any breach of client contract. We will also pay costs and expenses on your behalf. SECTION C: INTELLECTUAL PROPERTY RIGHTS INFRINGEMENT We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim first made against the company named as the Insured in the Declarations or any subsidiary and notified to us during the period of the policy arising out of your infringement of any intellectual property right in the course of your business activities. We will also pay costs and expenses on your behalf. SECTION D: POLLUTION LIABILITY We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim first made against the company named as the Insured in the Declarations or any subsidiary and notified to us during the period of the policy arising out of: a) pollution or contamination of the atmosphere, or of any water, land, buildings or other property; b) any enforcement action in connection with the containment, clean-up, removal or treatment of such pollution or contamination. We will also pay costs and expenses on your behalf. SECTION E: LOSS OF DOCUMENTS We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim first made against the company named as the Insured in the Declarations or any subsidiary and notified to us during the period of the policy arising out of destruction of, damage to, loss or mislaying of your documents or documents in your care, custody or control. We will also pay costs and expenses on your behalf. SECTION F: COMPUTER VIRUS AND HACKING ATTACK We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim first made against the company named as the Insured in the Declarations or any subsidiary and notified to us during the period of the policy as a direct result of: a) any third parties’financial losses arising directly from a hacking attack or virus that has emanated from or passed through your computer systems, or b) any third parties’financial losses arising directly from their inability to access your computer systems in the way in which you have authorised them to as a direct result of your computer systems’ failure or impairment due to a hacking attack or virus, or c) any third parties’financial losses arising directly from the loss or theft of your data or data for which you are responsible or held to be responsible arising directly from a hacking attack or virus. We will also pay costs and expenses on your behalf. SECTION G: LOSS MITIGATION We agree to pay any reasonable costs necessarily incurred by you with our prior written consent in respect of measures taken by you for the sole purpose of avoiding or mitigating a claim or potential claim for which you would be entitled to indemnity under INSURING CLAUSE 1 of this Policy had such measures not been taken. This Policy is a contract of insurance between you and us. Your Policy contains all the details of the cover that we provide, subject always to our receipt of the Premium. This Policy consists of and must be read together with the Declarations and any Endorsements. This Policy is not complete unless it is signed and a Declarations page is attached. The Sections of this policy are identified by BLUE LINES across the page with WHITE UPPER CASE PRINT. Clause headings in BLUE UPPER CASE PRINT are for information only and do not form part of the cover given by this Policy. Other terms in bold lower case print are defined terms and have a special meaning as set forth in the DEFINITIONS section and elsewhere. Words stated in the singular shall include the plural and vice versa. IMPORTANT: INSURING CLAUSES 1 and 2 provide cover on a claims made basis. Under these INSURING CLAUSES a claim must be first made against the company named as the Insured in the Declarations or any subsidiary during the period of the policy and notified to us during the period of the policy to be covered. In consideration of the Premium and in reliance upon the information that you have provided to us prior to commencement of this insurance and which is deemed to form the basis of this insurance: A&E CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 1 SECTION H: PAYMENT OF WITHHELD FEES We agree to pay your withheld fees with our prior written consent in the event that your client brings or threatens to bring a claim against you that would be covered under INSURING CLAUSE 1, SECTIONS A or B for an amount greater than your withheld fees if you attempt to recover the withheld fees from them. Prior to payment of your withheld fees you must obtain written confirmation from your client that they will not bring a claim against you if you agree not to pursue them for your withheld fees and provide it to us. ALL SECTIONS We will not make any payment on your behalf under any SECTION of this INSURING CLAUSE in respect of any claim arising directly or indirectly out of injury or damage: a) from products or workmanship; or b) that did not occur directly as a result of your business activities. INSURING CLAUSE 2: EMPLOYEE BENEFITS LIABILITY We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim first made against the company named as the Insured in the Declarations or any subsidiary and notified to us during the period of the policy arising out of any negligent act, error or omission committed by you or on your behalf in the administration of your employee benefit program. We will also pay costs and expenses on your behalf. Furthermore, we agree to pay on your behalf any costs and expenses necessarily incurred with our prior written consent in respect of measures taken by you with the object of avoiding or mitigating a claim for which you would be entitled to indemnity hereunder had such measures not been taken. INSURING CLAUSE 3: THIRD PARTY LIABILITY We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim arising out of accidental injury or damage occurring during the period of the policy in the course of your business activities. We will also pay costs and expenses on your behalf. However, we will not make any payment on your behalf under this INSURING CLAUSE in respect of any claim: a) which is covered under INSURING CLAUSE 1, or would be covered under INSURING CLAUSE 1 but for the exhaustion of the limit of liability or aggregate limit of liability of INSURING CLAUSE 1; b) arising directly or indirectly out of any product. INSURING CLAUSE 4: PRODUCTS LIABILITY We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim arising out of accidental injury or damage occurring during the period of the policy in the course of your business activities in connection with any product. We will also pay costs and expenses on your behalf. However, we will not make any payment on your behalf under this INSURING CLAUSE in respect of any claim which is covered under INSURING CLAUSE 1, or would be covered under INSURING CLAUSE 1 but for the exhaustion of the limit of liability or aggregate limit of liability of INSURING CLAUSE 1. INSURING CLAUSE 5: TENANTS’ LEGAL LIABILITY We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim arising out of accidental damage to premises leased to, hired by, on loan to or held in trust by you or otherwise in your care, custody or control occurring during the period of the policy in the course of your business activities. We will also pay costs and expenses on your behalf. However, we will not make any payment on your behalf under this INSURING CLAUSE in respect of any claim: a) which is covered under INSURING CLAUSE 1, or would be covered under INSURING CLAUSE 1 but for the exhaustion of the limit of liability or aggregate limit of liability of INSURING CLAUSE 1; b) arising directly or indirectly out of any product. INSURING CLAUSE 6: NON-OWNED AND HIRED AUTOMOBILE LIABILITY We agree to pay on your behalf to the extent the law allows all sums which the company named as the Insured in the Declarations becomes legally obliged to pay (including liability for claimants’ cost and expenses) as a result of any claim arising out of injury or damage occurring during the period of the policy and caused by the use or operation of any automobile in the course of your business activities that is: a) not owned in whole or in part by, or licensed in the name of, the company named as the Insured in the Declarations, or b) leased or hired in the name of the company named as the Insured in the Declarations. We will also pay costs and expenses on your behalf. INSURING CLAUSE 7: LIABILITY FOR DAMAGE TO HIRED OR LEASED AUTOMOBILES We agree to pay on your behalf all sums which you become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of any claim arising out of accidental damage to an automobile leased to or hired by you from a third party occurring during the period of the policy in the course of your business activities. We will also pay costs and expenses on your behalf. As a precedent to coverage under INSURING CLAUSES 6 and 7, you agree and warrant that all employees will maintain in full force and effect for the period of the policy primary automobile liability insurance in an amount equal to or greater than the minimum primary automobile liability limits required in the state of registration of the automobile. If a claim is made and the employee is determined to have failed the minimum limits required then the coverage under these INSURING CLAUSES will respond as excess coverage as though the minimum limits were in full force and effect, whereby you agree to pay all sums within and up to the required minimum limit. INSURING CLAUSE 8: MEDICAL EXPENSES We agree to pay medical expenses for injury caused by an accident occurring during the period of the policy: a) on premises you own or rent; b) on ways next to premises you own or rent; or c) because of your business activities; provided that: a) the injured person, at the time of the accident, is not entitled to benefits under any workers compensation or disability benefits law or similar law; and b) the medical expenses are incurred and notified to us within one year of the date of the accident; and c) the injured person submits to examination, at our expense, by physicians of our choice as often as we reasonably require. We will make these payments regardless of fault. INSURING CLAUSE 9: COMMERCIAL PROPERTY We agree to reimburse you up to the amount insured shown in the Declarations for: a) the cost of repairing damage occurring during the period of the policy to your office buildings, including landlord’s fixtures 2 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E and fittings, walls, gates and fences, yards, car parks and pavements, piping, ducting, cables, wires and associated control gear and accessories on the premises and extending to the public mains but only to the extent of your responsibility; b)damage occurring during the period of the policy to contents of every description contained in your office; c)damage occurring during the period of the policy to contents of every description kept at the home of your directors, officers, partners or employees in the course of your business activities; d)damage occurring during the period of the policy to contents of every description temporarily elsewhere, including while in transit; e) the necessary and reasonable costs you incur following damage occurring during the period of the policy to glass which belongs to you or for which you are legally responsible for: i) temporary boarding up; ii) repair of window frames or removal or replacement of fixtures and fittings in the course of replacing the glass; iii) replacement lettering or other ornamental work and alarm foil on glass; f)damage occurring during the period of the policy to money held in the course of your business activities: i) in the office during business hours, in transit or in a Bank Night Safe; ii) in the office outside business hours in a locked safe; iii) at the home of your directors, officers, partners or employees; g)damage occurring during the period of the policy to the personal belongings of your employees or visitors to the office provided they are not covered under any other insurance; h) the reasonable cost of compiling the documents, books of account, drawings, card index systems or other records including film, tape, disc, drum, cell or other magnetic recording or storage media for electronic data processing that you need to continue your business activities if these items have been lost or distorted as a direct result of damage covered under this INSURING CLAUSE; i) the costs you incur to replace locks and keys necessary to maintain the security of your office or safes following theft of keys involving force and violence occurring during the period of the policy; j) the amount of any rent for the office which you are legally obliged to pay for any period during which the office or any part of it is unusable as a result of damage covered under this INSURING CLAUSE. We also agree to pay: a)costs and expenses on your behalf; b) compensation as shown in the Declarations if any of your directors, officers, partners or employees who are aged between 16 and 70 on the Inception Date shown in the Declarations suffers an injury in the course of your business activities in a robbery or attempted robbery and suffers: i. death, permanent total disablement, loss of a limb or loss of sight as a direct result of the injury within one year of the date of its occurrence; ii.temporary total disablement. The compensation for temporary total disablement will be the amount shown in the Declarations per week, for a maximum of 104 weeks. However, we will not pay compensation under more than one heading in the Declarations for the same injury. INSURING CLAUSE 10: BUSINESS INTERRUPTION We agree to reimburse you up to the amount insured shown in the Declarations for your loss of income, extra expense, loss of research and development expenditure, project delay costs and accounts receivable resulting solely and directly from an interruption to your business activities caused by: a)insured damage to your office or contents of every description or to any other property used by you at your office; b)insured damage to property in the vicinity of your office which prevents or hinders your access to your office; c)insured damage at the premises of one of your suppliers, other than a supplier of water, gas, electricity or telephone services; d) failure in the supply of water, gas, electricity, or telephone services to your office for more than 24 consecutive hours caused by insured damage to any property; e)your inability to use your office due to restrictions imposed by a public authority following: i) a murder or suicide; ii) an occurrence of a notifiable human disease; iii)injury traceable to food or drink consumed at your office; iv) vermin or pests at your office. 3 HOW MUCH WE WILL PAY The maximum amount payable by us for all claims, losses, damage, costs and expenses and medical expenses shall not exceed the amounts shown in the Declarations in respect of each INSURING CLAUSE unless limited below. Where more than one claim or loss arises from the same original cause or single source or event all such claims or losses shall be deemed to be one claim or loss and only one limit of liability shall be payable in respect of the aggregate of all such claims or losses. Where cover is provided under multiple SECTIONS of INSURING CLAUSE 1 only one Limit of Liability shall be payable in respect of that claim. In respect of INSURING CLAUSES 1 to 7wemay at any time pay to you in connection with any claim the amount of the aggregate limit of liability or limit of liability (after deduction of any amounts already paid). Upon such payment being made we shall relinquish the conduct and control of and be under no further liability in connection with such claim except for the payment of costs and expenses incurred prior to the date of such payment (unless the aggregate limit of liability or limit of liability is stated to be inclusive of costs and expenses). In respect of INSURING CLAUSE 9 only: a) At our option, we will pay for any damaged property on the following basis: i) for the office, the cost of rebuilding or replacing the damaged property; ii) for contents of every description, the cost of repair or replacement as new. b) If, at the time the damage occurs, the amount insured is less than 85% of the total value of the office or contents of every description insured, the amount we will pay will be reduced in the same proportion as the amount insured bears to the total value of the office or contents of every description insured. c) The amount insured for the office and contents of every description will be adjusted monthly in line with any increase in nationally published indices. We will not reduce the amount insured without your consent. In respect of INSURING CLAUSE 10 the amount we will pay will be: CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E 1.“Accounts receivable” means: a) all sums due to you from customers, provided you are unable to effect collection thereof as the direct result of insured damage to records of accounts receivable; b) interest charges on any loan to offset impaired collections pending repayment of such sums made uncollectible by such insured damage; c) collection expense in excess of normal collection cost and made necessary because of insured damage. 2.“Administration” means: a) counseling employees, including their dependants and beneficiaries, with respect to your employee benefit program; b) handling records in connection with your employee benefit program; c) effecting enrolment or termination of any employee’s participation in a plan included in your employee benefit program; d) interpreting your employee benefit program. 3.“Aggregate limit of liability” means the maximum amount payable as stated in the Declarations by us in respect of all claims, or in respect of all accidents giving rise to medical expenses. 4.“Amount insured” means the maximum amount payable by us as shown in the Declarations in respect of each of INSURING CLAUSES 9 and 10. The amount applies to each incident of loss or damage occurring during the period of the policy provided always that after the first incident of loss or damage you comply with our recommendations to prevent any further incidents of loss or damage. 5.“Breach of client contract” means your unintentional breach of a written contract relating to the performance of your business activities for a client. 6.“Business activities” means: a) in respect of INSURING CLAUSE 1, the business activities as stated in the Declarations. b) in respect of all other INSURING CLAUSES, the business activities as stated in the Declarations and shall include, for the purpose of those business activities: i) the ownership, repair and maintenance of your property; ii) provision and management of canteen, social, sports and welfare organisations for the benefit of your directors, officers, partners or employees and medical, fire fighting, and security services; iii) attendance at conferences and tradeshows as either an exhibitor or visitor. 7.“Claim” means a demand received by you for money or services, including the service of suit or institution of arbitration proceedings. “Claim”shall also mean a threat or initiation of a suit seeking injunctive relief (meaning a temporary restraining order or a preliminary or permanent injunction). 8.“Client” means any third party with whom you have a written or implied contract in place for the supply of your business activities in return for a fee. 9.“Contents of every description” means the contents of your office used in connection with your business activities which are owned by you or for which you are legally responsible, including: a) computer and ancillary equipment (including monitors, keyboards, printers and software), television and video equipment, photographic, photocopying, surveying and telecommunications equipment; b) documents, briefs, manuscripts, plans, business books, computers systems records and programs; c) goods held in trust, stock and samples; d) wines, spirits and tobacco kept for entertainment purposes; e) works of art or precious metals; f) fixed glass in windows, doors and fanlights, glass showcases, glass shelves, mirrors and sanitary fixtures and fittings; g) heating oil for the office contained in fixed tanks in the open DEFINITIONS a) the difference between your actual income during the indemnity period and the income it is estimated you would have earned during that period or, if this is your first trading year, the difference between your income during the indemnity period and during the period immediately prior to the loss, less any savings resulting from the reduced costs and expenses you pay out of your income during the indemnity period; and b) any additional costs and expenses; c) any project delay costs during the indemnity period, including the total value of any milestone payments that were due in the indemnity period but will no longer be received by you either during the indemnity period or at any point in the future due to permanent termination of the project; d) any research and development expenditure irrevocably lost during the indemnity period; and e) any accounts receivable, provided you keep a record of all amounts owed to you and keep a copy of the record away from your office. YOUR DEDUCTIBLE We shall only be liable for that part of each and every claim, loss or medical expenses (which for the purpose of this clause shall be deemed to include all costs and expenses incurred) which exceeds the amount of the Deductible stated in the Declarations. Where more than one claim, loss or medical expenses arises from the same original cause or single source or event all such claims, losses or medical expenses shall be deemed to be one claim, loss or medical expenses and only one Deductible will apply. If any expenditure is incurred by us which by virtue of this clause is your responsibility then you shall reimburse such amount to us on our request or where possible we will deduct such amount from any payment we make to you. 4 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E at the address shown in the Declarations; h) tenant’s improvements, decorations, fixtures and fittings including, if attached to the building, external signs, aerials and satellite dishes; i) pipes, ducting, cables, wires and associated control equipment at the address shown in the Declarations and extending to the public mains. “Contents of every description”does not include money or the personal belongings of your employees or visitors to the office. 10.“Costs and expenses” means: a) in respect of INSURING CLAUSES 1 (SECTIONS A to F only) and 2, i)your legal costs and expenses in the defence or settlement of any claim made against you, and ii)your legal costs and expenses in the defence of any criminal claim made against you, provided that we maintain all rights of subrogation to recover such legal costs and expenses from any director, officer, partner or employee if they are found guilty of such a criminal act, and iii) the cost of bonds to release attachments but without any obligation to furnish these bonds, and iv) interest on that part of any judgment we pay that accrues after entry of the judgment and before we have paid, offered to pay, or deposited in court the part of the judgment that is within the limit of liability. b) in respect of INSURING CLAUSES 3 to 7, i)your legal costs and expenses in the defence or settlement of any claim made against you, and ii) the cost of bonds to release attachments but without any obligation to furnish these bonds, and iii) interest on that part of any judgment we pay that accrues after entry of the judgment and before we have paid, offered to pay, or deposited in court the part of the judgment that is within the limit of liability. c) in respect of INSURING CLAUSES 9 and 10, the costs and expenses incurred by you or on your behalf in establishing that you have sustained a loss or damage and the quantum of such loss or damage or the costs and expenses incurred by you or on your behalf in mitigating any such loss or damage. d) in respect of INSURING CLAUSE 9 only, the necessary and reasonable costs and expenses you incur to remove debris from the premises or the area immediately adjacent, following damage covered under this INSURING CLAUSE. Subject to all costs and expenses being incurred with the Claims Managers’ written consent (such consent not to be unreasonably withheld). If costs and expenses are shown in the Declarations to be in addition to the aggregate limit of liability or limit of liability in respect of any of INSURING CLAUSES 1 to 5,and if a payment in excess of the amount of indemnity available hereunder has to be made to dispose of any claim or number of claims, our liability for such costs and expenses shall be such proportion thereof as the amount of indemnity available hereunder bears to the amount required to dispose of such claim or claims. Costs and expenses are always included in the amount insured in respect of INSURING CLAUSES 9 and 10. 11.“Damage/damaged” means direct physical damage to, or destruction of, or loss of possession of, or loss of use of, tangible property. In respect of INSURING CLAUSES 1, 3 and 4 damage does not include damage to or destruction of, or loss of possession of, or loss of use of, or corruption of, data. 12.“Documents” means deeds, wills, agreements, maps, plans, records, books, letters, certificates, forms, computer programmes or information stored, written or punched into card or tape or magnetic discs or tapes or any other data media and documents of any nature whatsoever, whether written, printed or reproduced by any other method (other than bearer bonds, coupons, banks notes, currency notes and negotiable instruments). 13.“Employee” means any person employed by the company named as the Insured in the Declarations, or any subsidiary. Employee does not include any director, officer or partner of the company named as the Insured in the Declarations, or any subsidiary. 14.“Employee benefit program”means group automobile insurance, group homeowners insurance, group life insurance, group dental insurance, group health insurance, profit sharing plans, pension plans, early retirement offerings, employee investment subscription plans, Workers’ Compensation, Unemployment Insurance, Social Security, Disability Benefit Insurance, travel, savings or vacation plans or any similar benefit programs. 15.“Extra expense” means the necessary and reasonable extra costs and expenses you incur in order to continue your business activities during the indemnity period. 16.“Hacking attack” means any malicious or unauthorised electronic attack including but not limited to any fraudulent electronic signature, brute force attack, phishing, denial of service attack, that has been initiated by any third parties or by any employees and that is designed to damage, destroy, corrupt, overload, circumvent or impair the functionality of computer systems, software and ancillary equipment. 17.“Income” means your total income from your business activities. 18.“Indemnity period” means the period beginning at the date of the damage, or the date the restriction is imposed, and lasting for the period during which your income or expenditure is affected as a result of such damage or restriction, but for no longer than the number of months shown in the Declarations. 19.“Injury” means: a) in respect of INSURING CLAUSE 1 death, bodily injury, mental injury, illness or disease; b) in respect of all other INSURING CLAUSES: i) death, bodily injury, mental injury, illness, disease, shock, mental anguish or humiliation; and ii) false arrest, detention or imprisonment; and iii) malicious prosecution; and iv) wrongful entry into, or eviction of a person from, a room, dwelling or premises that the person occupies. 20.“Insured damage” means damage to property provided that: a) the damage is covered under INSURING CLAUSE 9; or b) an insurer has paid the claim, or has agreed to pay the claim, under any other insurance covering such damage. 5 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E 21.“Intellectual property right” means any intellectual property right including but not limited to trademarks, broadcasting rights, domain names, metatags and copyrights but does not include patents. 22.“Limit of liability” means the maximum amount payable by us as stated in the Declarations in respect of each claim or loss, or in respect of each accident giving rise to medical expenses. 23.“Loss of a limb” means loss by physical separation of a hand at or above the wrist, of a foot at or above the ankle, and includes total and irrecoverable loss of use of a hand, arm or leg. 24.“Loss of sight”means total and irrecoverable loss of sight. 25.“Loss” means direct financial loss sustained by you. 26.“Money” means cash, bank and currency notes, cheques, travellers’ cheques, postal orders, money orders, crossed bankers’ drafts, current postage stamps, savings stamps and certificates, trading stamps, gift tokens, customer redemption vouchers, company sales vouchers, credit card counterfoils, travellers tickets and contents of franking machines, all belonging to you. 27.“Medical expenses” means reasonable expenses for: a) first aid administered at the time of an accident; b) necessary medical, surgical, x ray and dental services, including prosthetic devices; c) necessary ambulance, hospital, professional nursing and funeral services. 28.“Office” means the office space (including any outbuildings) you occupy at the address shown in the Declarations as more fully described in the application form. 29.“Period of the policy” means the period between the Inception Date shown in the Declarations and the Expiry Date shown in the Declarations or until the Policy is cancelled in accordance with CONDITION 10 of this Policy. 30.“Permanent total disablement” means disablement which entirely prevents the injured person from attending to his business or occupation for twenty-four calendar months and at the expiry of that period being beyond hope of improvement. 31.“Project delay costs” means any additional costs and expenses incurred by you as a direct result of a delay to a project, including the interest charges incurred from any reasonable loan required as a result of a delayed milestone payment. 32.“Product” means any tangible property (including containers, packaging, labelling or instructions, but explicitly excluding any software, data, or source code) after it has left your custody or control which has been designed, specified, formulated, manufactured, constructed, installed, sold, supplied, distributed, treated, serviced, altered, processed, cleaned, renovated or repaired by you or on your behalf in the course of your business activities. 33.“Research and development expenditure” means your expenditure on research and development less the cost of reusable materials consumed for the purposes of the research and development. 34.“Subsidiary” means any company which the company named as the Insured in the Declarations controls through: a) holding 50% or more of the voting rights, or b) having the right to appoint or remove 50% or more of its board of directors; or c) controlling alone, pursuant to a written agreement with other shareholders or members, 50% or more of the voting rights therein. 35.“Temporary total disablement” means disablement which entirely prevents the injured person from attending to his business or occupation. 36.“Third party” means any person or company who is not a director, officer, partner or employee of the company named as the Insured in the Declarations, or any subsidiary. 37.“Virus” means any malicious software code including but not limited to any logic bomb, Trojan horse or worm that has been introduced by any third parties or by any employees and that is designed to damage, destroy, corrupt, overload, circumvent or impair the functionality of computer systems, software and ancillary equipment. 38.“We/our/us” means the Underwriters named in the Declarations. 39.“Withheld fees” means any contractually due fee that your client refuses to pay you, but excludes any part of the fee that represents your profit or mark-up or liability for taxes. 40.“Workmanship” means any physical workmanship in manufacture, fabrication, construction, erection, installation, assembly, alteration, servicing, remediation, repair, demolition or disassembly (including any materials, parts or equipment furnished in connection therewith) by you. 41.“Wrongful act” means any act or event the subject of INSURING CLAUSE 1 of this Policy for which you have purchased coverage. 42.“You/your” means: a) the company named as the Insured in the Declarations, or any subsidiary, and b) any past, present or future employee, trainee, director, officer or partner of the company named as the Insured in the Declarations or any subsidiary. 6 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E EXCLUSIONS We will not a) make any payment on your behalf for any claim, or b) incur any costs and expenses, or c) reimburse you for any loss, damage, legal expenses, fees or costs sustained by you, or d) pay any medical expenses: EXCLUSIONS RELATING TO OTHER INSURANCES: 1.Marine and aviation arising directly or indirectly from the ownership, possession or use by you or on your behalf of any aircraft, hovercraft, offshore installation, rig, platform or watercraft. 2.Auto arising directly or indirectly from the ownership, possession or use by you or on your behalf of any motor vehicle or trailer other than injury or damage: a) caused by the use of any tool or plant forming part of or attached to or used in connection with any motor vehicle or trailer; b) occurring beyond the limits of any carriageway or thoroughfare and caused by the loading or unloading of any motor vehicle or trailer; c) arising out of the use of any motor vehicle or trailer temporarily in your custody or control for the purpose of parking; provided always that we will not make any payment on your behalf or incur any costs and expenses in respect of any legal liability for which compulsory insurance or security is required by legislation or for which a government or other authority has accepted responsibility. However, this EXCLUSION shall not apply in respect of INSURING CLAUSES 6 and 7. 3.Project-specific insurance arising out of any projects for which you have purchased project specific insurance. 4.Product guarantee for costs incurred in the repair, alteration, reinstatement, inspection, reconditioning or replacement of any product or part thereof and any financial loss consequent upon the necessity for such repair, alteration, reinstatement, inspection, reconditioning or replacement, other than in respect of INSURING CLAUSE 1 when you are legally obliged to pay these sums to a client. 5.Product recall arising directly or indirectly from the recall of any product or part thereof except for claims made under INSURING CLAUSE 1 where you are legally liable for these costs to a third party as the direct result of a wrongful act committed or alleged to have been committed by you. 6.Employment practices arising out of or resulting from any employer-employee relations, policies, practices, acts, omissions, any actual or alleged refusal to employ any person, or misconduct with respect to employees. 7.Employers’ liability arising directly or indirectly out of injury to your directors, officers, partners or employees. However, this EXCLUSION shall not apply to employees on whose behalf contributions are required to be made by you under the provisions of any Workers’ Compensation Law in respect of whom liability has been denied by any Workers’ Compensation authority. 8.Directors’ and Officers’ arising out of any personal liability incurred by your directors or officers when they are acting in that capacity or managing you, or arising from any statement, representation or information regarding your business contained within any accounts, reports or financial statements. 9.Double insurance for which you are entitled to indemnity under any other insurance except for a) any additional sum which is payable over and above such other insurance, or b) any contribution that we are obliged to make by law and that contribution shall be in proportion to the respective limits of liability or amounts insured of the Policies. EXCLUSIONS RELATING TO THE CONDUCT OF YOUR BUSINESS: 10.Automobile use without owner’s consent arising out of or relating directly or indirectly to the use by you of any automobile or trailer without the consent of the owner. 11.Benefit laws arising directly or indirectly out of your failure to comply with the mandatory provisions of any law concerning workers compensation, unemployment insurance, social security, disability benefits or pension benefits. 12.Circumstances known at inception arising out of any circumstances or occurrences which could give rise to a claim, loss or damage under this Policy or any accidents giving rise to medical expenses of which you are aware, or ought reasonably to be aware, prior to the Inception Date of this Policy, whether notified under any other insurance or not. 13.Computer failure in respect of INSURING CLAUSES 9 and 10 only, arising directly or indirectly from loss or distortion of your data or damage to your electrical or mechanical plant resulting from a failure of your computer or ancillary equipment (including monitors, keyboards, printers or software), television or video equipment, photographic, photocopying, surveying or telecommunications equipment. However, we will reimburse you up to the amount insured for damage occurring during the period of the policy to your office computer and ancillary equipment, but only if your office computer and ancillary equipment is subject to a manufacturer’s guarantee or a maintenance contract providing free parts and labour in the event of a breakdown. 14.Contractual fines and penalties for fines and penalties arising from your breach of contract, including any liquidated damages, service credits or associated penalties arising from your failure to perform under a service level agreement 15.Driving while intoxicated or unlicensed in respect of INSURING CLAUSES 6 and 7 only, arising out of or relating directly or indirectly to the use of a vehicle by you where: a) the driver of that vehicle is driving under the influence of alcohol or other drugs (DUI), driving while intoxicated (DWI), operating while impaired (OWI), or operating the vehicle 7 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E under the influence of alcohol or other drugs (OVI); or b) the driver of that vehicle does not hold the appropriate license to use the vehicle. 16.Employee benefit program advice arising directly or indirectly from: a) advice given to any person to participate or not to participate in any plan included in your employee benefit program; b) the failure of any investment to perform as represented by you. 17.ERISA arising out of or resulting from your acts related to any pension, healthcare, welfare, profit sharing, mutual or investment plans, funds or trusts; or any violation of any provision of the Employee Retirement Income Security Act of 1974, or any amendment to the Act or any violation of any regulation, ruling or order issued pursuant to the Act. 18.Failure to ensure feasibility of contracts arising from any contract where before entering into or amending the contract you failed to take reasonable steps to ensure that you could fulfil all your obligations in accordance with the terms of the contract. 19.Hired or leased vehicles exclusions in respect of INSURING CLAUSE 7 only, arising out of or relating directly or indirectly to: a)damage to tires or consisting of or caused by mechanical failure or breakdown of any part of an automobile or by rusting, corrosion, wear and tear, freezing or explosion within the combustion chamber; b)damage to contents of trailers or to rugs or robes; c)damage occurring after theft by any person residing in the same dwelling premises as you; d)damage caused by any employee engaged in the operation, maintenance or repair of the automobile. 20.Faulty workmanship arising from damage to your property or office caused directly or indirectly by misuse, inadequate or inappropriate maintenance, faulty workmanship, defective design, the use of faulty materials or whilst being cleaned, worked on or maintained. 21.Long term leased vehicles arising out of or relating directly or indirectly to any automobile or trailer hired or leased by you from a third party for a period greater than 30 consecutive days. 22.Hazardous devices arising directly or indirectly from any product which with your knowledge is intended for incorporation into the structure, machinery or controls of any aircraft, other aerial device, military vehicle, hovercraft, waterborne craft or any medical equipment. 23.Legal Action where action for damages is brought in a court of law outside the territories specified in the Declarations, or where action is brought in a court of law within those territories to enforce a foreign judgement whether by way of reciprocal agreement or otherwise. 24.Limiting recovery rights arising directly or indirectly out of your failure to take reasonable steps to ensure that our rights of recovery against any third party are not unduly restricted or financially limited by a specific term in any contract or agreement. 25.Patents arising out of the actual or alleged infringement of any patent or inducing the infringement of any patent. 26.Retroactive Date in respect of INSURING CLAUSES 1 and 2 only, arising out of any actual or alleged wrongful act or negligent act, error or omission committed before the date specified as the Retroactive Date in the Declarations. 27.RICO for or arising out of any actual or alleged violation of the Organised Crime Control Act of 1970 (commonly known as the Racketeer Influenced and Corrupt Organisation Act or RICO), as amended, or any regulation promulgated thereunder or any similar federal, state or local law, whether such law is statutory, regulatory or common law. 28.SEC for or arising out of the actual or alleged violation of the Securities Act of 1933, the Securities Exchange Act of 1934, or any similar state or federal law, or any amendment to the above laws or any violation of any order, ruling or regulation issued pursuant to the above laws. 29.Unjust enrichment in respect of INSURING CLAUSE 1 only, for that part of any claim that results in you being in a better financial position as a direct result of your wrongful act than you would have been if you had not committed the wrongful act. 30.Wilful or dishonest acts in respect of INSURING CLAUSES 1 and 2 only, arising out of any wilful, malicious, reckless or dishonest act or omission committed by you. GENERAL INSURANCE EXCLUSIONS: 31.Antitrust for or arising out of any actual or alleged antitrust violation, restraint of trade, unfair competition, false, deceptive or unfair trade practices, violation of consumer protection laws or false or deceptive advertising unless insurable under the applicable law. 32.Asbestos arising from or contributed to by the manufacturing, mining, use, sale, installation, removal, distribution of or exposure to asbestos, materials or products containing asbestos, or asbestos fibres or dust, unless arising directly from a wrongful act committed by you: a) on or after 1st January 1990, or b) on or after the date specified as the Retroactive Date in the Declarations, whichever is the later, in the course of your business activities. 33.Associated companies a) in respect of any claim made by any company firm or partnership in which the company named as the Insured in the Declarations has an executive or financial interest, unless such claim emanates from an independent third party; or b) in respect of any claim made by any company firm partnership or individual which has an executive or financial interest in the company named as the Insured in the Declarations or any subsidiary, unless such claim emanates from an independent third party; or c) arising out of or resulting from any of your activities as a trustee, partner, officer, director or employee of any employee trust, charitable organization, corporation, company or business other than that of the company named as the Insured in the Declarations or any subsidiary; or d) in respect of any claim made by or on behalf of the company named as the Insured in the Declarations or any subsidiary. 8 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E 34.Earthquake in respect of INSURING CLAUSES 9 and 10 only, caused by earthquake, except for: a) ensuing loss or damage which results directly from fire, explosion, smoke or leakage from fire protective equipment; or b) ensuing damage to contents of every description while in transit. 35.Electromagnetic fields directly or indirectly arising out of, resulting from or contributed to by electromagnetic fields, electromagnetic radiation, electromagnetism, radio waves or noise. 36.Flood in respect of INSURING CLAUSES 9 and 10 only, caused by flood, including waves, tides, tidal waves, or the rising of, the breaking out, or the overflow, of any body of water whether natural or manmade, but this EXCLUSION does not apply to: a) ensuing loss or damage which results directly from fire, explosion, smoke or leakage from fire protective equipment; or b) ensuing damage to contents of every description while in transit. 37.Fines for fines, penalties, civil or criminal sanctions and for punitive, multiple or exemplary damages unless insurable under the applicable law. 38.Insolvency arising out of or relating directly or indirectly from your insolvency or bankruptcy, or the insolvency or bankruptcy of any third party. Furthermore, no coverage is provided under INSURING CLAUSE 10 if you become insolvent or bankrupt. 39.Land or water arising directly or indirectly from damage to land or water within or below the boundaries of any land or premises presently or at any time previously owned or leased by you or otherwise in your care, custody or control. 40.Miscellaneous property exclusions in respect of INSURING CLAUSES 9 and 10 only, arising directly or indirectly from: a) wear and tear, inherent defect, rot, vermin or infestation, or any gradually operating cause; b) dryness or humidity, being exposed to light or extreme temperatures, unless the damage is caused by storm or fire; c) coastal or river erosion; d) theft from an unattended vehicle unless the item is out of sight; e) frost, other than damage due to water leaking from burst pipes forming part of the permanent internal plumbing provided the office is occupied and in use; f) arising directly or indirectly from unexplained loss or disappearance or inventory shortage of your property; g) a hacking attack or virus. 41.Named windstorms in respect of INSURING CLAUSES 9 and 10 only, caused: a) directly or indirectly by a windstorm which is given a name by the National Hurricane Center, Miami, FL, regardless of any other cause or event that contributes concurrently or in any sequence to the loss or damage, or b) by rain, snow, sand or dust, whether driven by wind or not, if that loss or damage would not have occurred but for a windstorm which is given a name by the National Hurricane Center, Miami, FL. But if the windstorm results in a cause of loss or damage other than rain, snow, sand or dust, and that resulting cause of loss or damage is not otherwise excluded under this Policy, we will pay for that loss or damage. For example, if the windstorm damages a heating system and fire results, the loss or damage attributable to the fire is covered subject to any other applicable policy provisions. 42.Nuclear arising directly or indirectly from or contributed to by : a) ionising radiations or contamination by radioactivity from any nuclear fuel or from any nuclear waste from the combustion of nuclear fuel; b) the radioactive, toxic, explosive or other hazardous properties of any explosive nuclear assembly or nuclear component thereof. 43.Pollution arising directly or indirectly out of : a) pollution or contamination of the atmosphere, or of any water, land, buildings or other property; b) any enforcement action in connection with the containment, clean-up, removal or treatment of such pollution or contamination; but this EXCLUSION shall not apply in respect of : i)INSURING CLAUSE 1, SECTION D; or ii) premises leased to, hired by, on loan to or held in trust by you or otherwise in your care, custody or control in respect of: a)injury caused by smoke, fumes, vapor or soot from equipment used to heat the building, or b)injury or damage arising out of heat, smoke or fumes from a hostile fire. For the purpose of this EXCLUSION a hostile fire means one which becomes uncontrollable or breaks out from where it was intended to be. iii)INSURING CLAUSES 9 and 10 to the backing up of sewers, sumps, septic tanks or drains. 44.Toxic mould / fungus arising directly or indirectly from any loss, injury, damage, costs or expenses, including, but not limited to, losses, damage, costs or expenses related to, arising from or associated with clean-up, remediation, containment, removal or abatement, caused directly or indirectly, in whole or in part, by: a) any fungus, mould, mildew or yeast, or b) any spore or toxins created or produced by or emanating from such fungus, mould, mildew or yeast, or c) any substance, vapour, gas, or other emission or organic or inorganic body or substance produced by or arising out of any fungus, mould, mildew or yeast, or d) any material, product, building component, building or structure, or any concentration of moisture, water or other liquid within such material, product, building component, building or structure, that contains, harbours, nurtures, or acts as a medium for any fungus, mould, mildew, yeast or spore or toxins emanating therefrom, regardless of any other cause, event, material, product or building component that contributed concurrently or in any sequence to that loss, injury, damage, cost or expense. However, this EXCLUSION shall not apply in respect of INSURING CLAUSE 1 where the loss, injury, damage, costs or expenses arose directly from a wrongful act committed by you in the course of your business activities. For the purposes of this EXCLUSION the following definitions are added to the Policy: Fungus includes, but is not limited to, any plants or organisms belonging to the major group Fungi, lacking chlorophyll, and 9 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E CONDITIONS including moulds, rusts, mildews, smuts and mushrooms. Mould includes, but is not limited to, any superficial growth produced on damp or decaying organic matter or on living organisms, and fungi that produced moulds. Spore means any dormant or reproductive body produced by or arising from or emanating out of any fungus, mould, mildew, plants, organisms or microorganisms. 45.Trade Debt arising out of or in connection with any trading losses or trading liabilities incurred by any business managed or carried on by you, or any loss of your profit arising from the loss of any client, account or business. 46.War and terrorism directly or indirectly caused by, resulting from or in connection with any of the following regardless of any other cause or event contributing concurrently or in any other sequence to the claim, loss, damage, costs and expenses or medical expenses; a) war, invasion, acts of foreign enemies, hostilities or warlike operations (whether war be declared or not), civil war, rebellion, insurrection, civil commotion assuming the proportions of or amounting to an uprising, military or usurped power; or b) any act of terrorism. For the purpose of this EXCLUSION an act of terrorism means an act, including but not limited to the use of force or violence or the threat thereof, of any person or groups of persons, whether acting alone or on behalf of or in connection with any organisations or governments, committed for political, religious, ideological or similar purposes including the intention to influence any government or to put the public, or any section of the public, in fear. This EXCLUSION also excludes claims, losses, damage, costs and expenses or medical expenses of whatsoever nature directly or indirectly caused by, resulting from or in connection with any action taken in controlling, preventing, suppressing or in any way relating to a) or b) above. This EXCLUSION does not apply to any claim or loss arising directly from a hacking attack or virus. 1.What you must do in the event of a claim or loss Should any director, partner, or senior executive officer of the company named as the Insured in the Declarations and any subsidiary become aware of any claim, loss or damage or of any situation that could give rise to a claim or loss or should an allegation, complaint or claim be made or intimated against you, the following obligations must be complied with by you: a)You must not admit liability for or settle or make or promise any payment in respect of any claim, loss or damage which may be covered under this Policy. Neither must you incur any costs or expenses in connection with such a claim, loss or damage without our written consent. However, you should arrange for any urgent repairs following damage covered under INSURING CLAUSE 9 to be done immediately. Before any other repair work begins we have the right to inspect your damaged property. We will notify you if we intend to do this. b) The Claims Managers, as specified in the Declarations, must be notified as soon as is reasonably possible and in any event within 75 days if during the period of the policy i)you suffer any loss or damage that could be covered by this Policy or any allegation, complaint or claim is made or intimated against you, whether verbal or made in writing. ii) any director, partner, or senior executive officer of the company named as the Insured in the Declarations and any subsidiary become aware of the intention of any person to make a complaint allegation or claim against you, whether verbal or in writing. Once notice has been made to us, we will regard any subsequent claim that may arise as notified under this Policy. iii)you become aware of an action of yours that could give rise to a loss, allegation, complaint or claim being made or intimated against you. Once notice has been made we will regard any subsequent claim that may arise as notified under this Policy. iv)you discover reasonable cause for suspicion of fraud or dishonesty whether this could give rise to a claim under this Policy or not and we shall not be liable under this Policy for any claim or loss sustained in consequence of any fraudulent or dishonest act or omission committed after the date of such discovery. We have nominated the Claims Managers to accept notice on our behalf. Due to the nature of the coverage offered by this Policy, any unreasonable delay by any director, partner, or senior executive officer of the company named as the Insured in the Declarations and any subsidiary in notifying the Claims Managers of (i), (ii), (iii) or (iv) above could lead to the size of the claim, loss or damage increasing or to our rights being restricted. We shall not be liable for that portion of any claim that is due to any unreasonable delay in any director, partner, or senior executive officer of the company named as the Insured in the Declarations and any subsidiary notifying the Claims Managers of any claim, loss or damage in accordance with this CONDITION. c)We will expect you to provide us with full and accurate information about any matter that you notify to us under your obligations set out above. Once notice has been made you must give the Claims Managers all the assistance and information that is reasonably required. You must follow their advice and do anything that they reasonably require you to do to avoid, minimise, settle or defend any claim, loss or damage. If you think a crime has been committed you must report it to the appropriate law enforcement authorities. You must also permit the Claims Managers and any other parties that are appointed by the Claims Managers to notify the appropriate law enforcement authorities of any claim, loss or damage where this action is deemed necessary, and you must comply with the advice given by such authorities. If any of your computer or ancillary equipment is lost or stolen while it is temporarily removed from the office, we will not make any payment unless you report the loss to the police within 48 hours after you become aware of it. 10 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E 2.Continuous cover If you have neglected, through error or oversight only, to report a claim made against you during the period of a previous renewal of this Policy issued to you by us, then provided that you have maintained uninterrupted insurance of the same type with us since the expiry of that earlier Policy, then, notwithstanding EXCLUSION 12, we will permit the matter to be reported under this Policy and will indemnify you, provided that: a) the indemnity will be subject to the applicable aggregate limit of liability or limit of liability of the earlier Policy under which the matter should have been reported or the aggregate limit of liability or limit of liability of the current Policy, whichever is the lower; b)we may reduce the indemnity entitlement by the monetary equivalent of any prejudice which has been suffered as a result of the delayed notification; c) the indemnity will be subject in addition, to all of the terms, CONDITIONS, DEFINITIONS and EXCLUSIONS, other than the aggregate limit of liability or limit of liability, contained in this current Policy. 3.Fraudulent claims If you notify us of any claim knowing that claim to be false or fraudulent in any way, we shall have no responsibility to pay that claim or any other claims under this insurance and the Policy will be treated as if it had not been effected. 4.Agreement to pay claims We have the right and duty to take control of and conduct in your name the investigation settlement or defence of any claim. We shall also pay on your behalf costs and expenses incurred with our prior written consent (subject to the Limits of Liability and applicable Deductible shown in the Declarations) provided that we shall not a) pay for the costs and expenses of any part of a claim that is not covered by this Policy. b) incur any costs and expenses in the defence of any claim unless there is a reasonable prospect of success, taking into account the commercial considerations of the costs of defence. We shall always endeavour to settle any claim through negotiation, mediation or some other form of alternative dispute resolution and shall pay on your behalf the amount so agreed by us and the claimant. If we cannot settle by such means, we shall pay the amount which you are found liable to pay either in court or through arbitration proceedings, subject always to the Limit of Liability shown in the Declarations. If you refuse to consent to a settlement that we recommend and that the claimant will accept, you must then defend, investigate or settle the claim at your own expense. As a consequence of your refusal, our liability for any claim shall not be more than the amount that we could have settled the claim for had you consented, plus any costs and expenses incurred prior to the date of such refusal. 5.Innocent non-disclosure We will not seek to avoid the Policy or reject any claim on the grounds of non-disclosure or misrepresentation except where the non-disclosure or misrepresentation was reckless or fraudulent or you failed to conduct a full inquiry prior to providing the information that forms the basis of this insurance. In the event that we seek to avoid the Policy or reject any claim on this basis the burden of proving otherwise rests solely with you. 6.Your duty to advise us of changes If you become aware that any of the information that you have given us in the Application Form or elsewhere in connection with your application for this insurance has materially changed then you must advise us as soon as is practicable. In this event, we reserve the right to amend the terms, conditions or premium of the Policy. 7.Risk management conditions If we attach any additional conditions to your Policy regarding any risk survey or risk management timetable or any other similar conditions then it is your responsibility to ensure that these conditions are complied with by the deadlines shown in the conditions. 8.Our rights of recovery If any payment is made under this Policy in respect of a claim, loss or damage and there is available to us any of your rights of recovery against any other party then we maintain all such rights of recovery. We shall not exercise these rights against any past, present or future employee, director, officer or partner of the company named as the Insured in the Declarations or any subsidiary, unless such payment is in respect of any wilful, malicious or dishonest acts or omissions. You must do nothing to impair any rights of recovery. At our request you will bring proceedings or transfer those rights to us and help us to enforce them. Any recoveries shall be applied as follows: a) first, to us up to the amount of our payment on your behalf including costs and expenses; b) then to you as recovery of your Deductible or other amounts paid as compensation or costs and expenses. 9.Waiver of subrogation Notwithstanding CONDITION 8 above we agree to waive our rights of subrogation against a responsible third party client of yours but only if you and your client have entered into a contract that contains a provision requiring us to do this. 10.Cancellation This Policy may be cancelled: a) by you at any time on request; or b) by us if we give you 30 days written notice, or c) by us if we give you 15 days written notice, should any amount in default not be paid within 15 days of the due date shown in the Debit Note that accompanies this Policy. If you give us notice of cancellation in accordance with a) above, the earned Premium shall be computed at pro rata to the number of days that the Policy is in effect subject to a minimum amount of 30% of the Premium. If we give you notice of cancellation in accordance with b) or c) above, the Premium shall be computed at pro rata to the number of days that the Policy is in effect. The Policy Administration Fee shall be deemed fully earned upon inception of the Policy. 11.Additional insureds We shall indemnify any third party as an additional Insured under this Policy, but only in respect of sums which they become legally obliged to pay (including liability for claimants’ costs and expenses) as a result of a claim arising solely out of a wrongful act committed by you or arising solely out of accidental injury or damage caused by you, provided that: a)you contracted in writing to indemnify the third party for such a claim prior to it first being made against them; and b)had the claim been made against you, then you would be entitled to indemnity under this Policy. 11 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E Where we indemnify a third party as an additional insured under this Policy, this Policy shall be primary and non-contributory to the third party’s own insurance, but only if you and the third party have entered into a contract that contains a provision requiring this. As a condition to our indemnification of any additional Insured: i) they shall prove to our satisfaction that the claim arose solely out of a wrongful act committed by you or arose solely out of accidental injury or damage caused by you; and ii) they shall fully comply with CONDITION 1(a)above as if they were you. Where a third party is indemnified as an additional Insured as a result of this CONDITION, it is understood and agreed that any claim made by that third party against you shall be treated by us as if they were a third party, not an additional Insured. 12.Prior subsidiaries In respect of INSURING CLAUSE 1 only, should an entity cease to be a subsidiary after the Inception Date of this Policy, cover in respect of such entity shall continue as if it was still a subsidiary, until the termination of this Policy, but only in respect of any claim or loss that arises out of any act, error or omission committed by that entity prior to the date that it ceased to be a subsidiary. 13.Mergers and acquisitions During the period of the policy, if the company named as the Insured in the Declarations or any subsidiary a) purchases assets or acquires liabilities from another entity in an amount greater than 10% of the assets of the company named as the Insured in the Declarations as listed in its most recent financial statement; or b) acquires another entity whose annual revenues are more than 10% of the annual revenues of the company named as the Insured in the Declarations for their last completed financial year; then you shall have no coverage under this Policy for any claim, loss or damage that arises directly or indirectly out of the purchased or acquired entity unless the company named as the Insured in the Declarations gives us written notice prior to the purchase or acquisition, obtains our written consent to extend coverage to such additional entities, assets or exposures, and agrees to pay any additional premium required by us. If during the period of the policy the company named as the Insured in the Declarations consolidates or merges with or is acquired by another entity, then all coverage under this Policy shall terminate at the date of the consolidation, merger or acquisition unless we have issued an endorsement extending coverage under this Policy, and the company named as the Insured in the Declarations has agreed to any additional premium and terms of coverage required by us. 14.Extended reporting period In respect of INSURING CLAUSES 1 and 2 only, an Extended Reporting Period of 60 days following the Expiry Date as shown in the Declarations shall be automatically granted hereunder at no additional premium. Such Extended Reporting Period shall cover claims first made and reported to us during this 60 day Extended Reporting Period but only in respect of any act, error or omission committed prior to the date of cancellation or non-renewal, and subject to all other terms, conditions and exclusions of the policy. No claim shall be accepted by us in this 60 day Extended Reporting Period if you are entitled to indemnity under any other insurance, or would have been entitled to indemnity under such insurance but for the exhaustion thereof. 15.Optional extended reporting period In respect of INSURING CLAUSES 1 and 2 only, in the event of: a) cancellation or non-renewal of this Policy by us, or b) cancellation or non-renewal of this Policy by you because you have ceased to trade as the direct result of the retirement or death of all of your directors, officers or partners; then you shall have the right, upon payment of the Optional Extended Reporting Period Premium shown in the Declarations in full and not proportionally or otherwise in part, to have issued an endorsement providing a 365 day Optional Extended Reporting Period from the cancellation or non-renewal date. Such Optional Extended Reporting Period shall cover claims first made against the company named as the Insured in the Declarations or any subsidiary and notified to us during this Optional Extended Reporting Period but only in respect of any claim arising out of any act, error or omission committed prior to the date of cancellation or non-renewal, and subject to all other terms, conditions and exclusions of the policy. In order for you to invoke the Optional Extended Reporting Period option, the payment of the Optional Extended Reporting Period Premium shown in the Declarations for this Optional Extended Reporting Period must be paid to us within 15 days of the date of the non-renewal or cancellation. At the commencement of this Optional Extended Reporting Period the entire premium shall be deemed earned and in the event that you terminate the Optional Extended Reporting Period for any reason prior to its natural expiration, we will not be liable to return any premium paid. The right to the Extended Reporting Period or the Optional Extended Reporting Period shall not be available to you where: a) Cancellation or non-renewal by us is due to non-payment of premium, or b) Cancellation or non-renewal by us is due to your failure to pay such amounts in excess of the applicable Limit of Liability or within the amount of the applicable Deductible as is required by this Policy in the payment of claims. At the renewal of this Policy, our quotation of different premium, Deductible or Limit of Liability or changes in policy language shall not constitute non-renewal by us for the purposes of granting this Optional Extended Reporting Period. In no event shall the granting of the Extended Reporting Period or the Optional Extended Reporting Period increase our Limit of Liability, including costs and expenses, as shown in the Declarations. 16.Service of suit In the event of a dispute between you and us regarding this Policy we agree, at your request, to submit to the jurisdiction of a Court of competent jurisdiction within the United States of America. Nothing in this CONDITION constitutes or should be understood to constitute a waiver of our rights to commence an action in any Court of competent jurisdiction in the United States of America, to remove an action to a United States District Court, or to seek a transfer of a case to another Court as permitted by the laws of the United States of America or the laws of any State of the United States of America. 12 CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 It is further agreed that service of process in such suit may be made upon: Mendes & Mount LLP 750 Seventh Avenue New York, N.Y. 10019-6829 and that in any suit instituted against us, we will abide by the final decision of such Court or of any Appellate Court in the event of an appeal. Mendes & Mount LLP are authorized and directed to accept service of process on our behalf in any such suit and, at your request, to give a written undertaking to you that they will enter a general appearance on our behalf in the event such a suit is instituted. Additionally, in accordance with the statute of any state, territory or district of the United States which makes such a provision, we hereby designate the Superintendent, Commissioner or Director of Insurance or other officer specified for that purpose in the statute, or his successor or successors in office, as our true and lawful attorney upon whom may be served any lawful process in any action, suit or proceeding instituted by you arising out of this Policy. Mendes & Mount LLP are hereby designated as the firm to whom the above-mentioned officer is authorized to mail such process or a copy thereof. 13A&E CFC Underwriting Limited 85 Gracechurch Street London EC3V 0AA United Kingdom T: +44 (0) 207 220 8500 F: +44 (0) 207 220 8501 E: enquiries@cfcunderwriting.com W: www.cfcunderwriting.com INSURANCE FOR ARCHITECTS & ENGINEERS CFC Underwriting Ltd are Authorised and Regulated by the Financial Conduct Authority ©1999-2014 CFC Underwriting Ltd, All Rights Reserved CFC A&E US V2.6 A&E