RUS Form 198 Equipment Contract

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According to the paperwork Reduction Act of.1995, an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid OMB
control number. The valid OMB control number for this information collection is 0572-0107. The time required to complete this information collection is estimated to average 5 minutes per
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U.S. Department of Agriculture
Rural Utilities Service

EQUIPMENT CONTRACT
NOTICE AND INSTRUCTIONS TO BIDDERS
1.

Sealed proposals for the furnishing and delivering f. o. b.

of equipment for the rural electric project of
RUS designation

,

, (hereinafter called the ''Owner") will be received by the Owner on or

before

o'clock

M.,

at

,20

, at its office

at which time and place the proposals will be
publicly opened and read.
privately opened. The Owner, subsequent to the bid opening, may elect to conduct clarifying discussions

with the bidder to resolve any questions related to the substance of the bidder's proposal and to arrive at a final
price for a responsive bid.
Any proposals received subsequent to the time specified will be promptly returned to the Bidder unopened.
2. Obtaining Documents. The Plans, Specifications, and Construction Drawings, together with all necessary
forms and other documents for bidders may be obtained from the Owner, or from the Engineer
at the latter's office at
upon the payment of $

, which payment will not be subject to refund. The Plans,
Specifications, and Construction Drawings may be examined at the office of the Owner or at the office of the
Engineer.
3. Manner of Submitting Proposals. Proposals and all supporting instruments must be submitted on the forms
furnished by the Owner and must be delivered in a sealed envelope addressed to the Owner. The name and
address of the Bidder and the date and hour of the opening of bids must appear on the envelope in which the
Proposal is submitted. Proposals must be completed in ink or typewritten. No alterations or interlineations
will be permitted, unless made before submission, and initialed and dated. The successful Bidder will be
required to execute two additional counterparts of the Proposal.
4.

Due Diligence. Prior to the submission of the Proposal, the Bidder shall make and shall be deemed to have
made a careful examination of the Plans, Specifications, Construction Drawings, and form of Proposal, and
shall review the location and nature of the proposed construction, the transportation facilities, the kind and
character of soil and terrain to be encountered, the kind of facilities required before and during the
construction of the project, general local conditions, environmental and historic preservation considerations,
and all other matters that may affect the cost and time of completion of the work. Bidder will be required to
comply with all federal, state, and local laws, rules, and regulations applicable to its performance, including
those pertaining to the licensing of contractors, and the Anti Kick-Back Act of 1986 (41 U.S. C. 51 et seq).

5.

Proposals will be accepted only from those prequalified bidders invited by the Owner to submit a proposal.

6.

The Time for Delivery of the Equipment is of the essence of the Contract and shall be as specified by the
Engineer in the Proposal.

RUS FORM 198 (Rev. 4-04)
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7. Evaluation Factors. In estimating the lowest cost to the Owner as one of the factors in deciding the award of
the Contract, the Owner will consider, in addition to the price quoted in the Proposals, the following:

8. Debarment Certification. The Bidder must provide to the Owner a suspension and debarment certificate in
the form attached hereto.
9. Contract is Entire Agreement. The Contract to be effected by the acceptance of the Proposal shall be
deemed to include the entire agreement between the parties thereto, and the Bidder shall not claim any
modifications thereof resulting from any representation or promise made at any time by any officer, agent or
employee of the Owner or by any other person.
10. Minor Irregularities. The Owner reserves the right to waive minor irregularities or minor errors in any
Proposal, if it appears to the Owner that such irregularities or errors were made through inadvertence. Any
such irregularities or errors so waived must be corrected on the Proposal in which they occur prior to the
acceptance thereof by the Owner.
11. Bid Rejection. The Owner reserves the right to reject any or all Proposals.
12. Definition of Terms. The terms ''Administrator'' and ''Engineer'' as used throughout this Contract shall be as
defined in Article VI, Section 1, of the Proposal.

Owner

By

Title

,20
Date

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PROPOSAL
TO:

(hereinafter called the ''Owner").

ARTICLE 1--GENERAL
Section 1. Offer to Furnish and Deliver. The undersigned (hereinafter called the ''Bidder") hereby proposes to
furnish and deliver the equipment (hereinafter called the "Equipment") described in the Plans,
Specifications, and Construction Drawings for the following prices:
Item:

Price:

Item:

Price:

The prices of Equipment set forth herein shall include the cost of delivery to:

The prices set forth herein do not include any sums which are or may be payable by the Bidder on
account of taxes imposed by any taxing authority upon the sale, purchase or use of the Equipment. If
any such tax is applicable to the sale, purchase or use of the Equipment hereunder, the amount thereof
shall be added to the purchase price and paid by the Owner.
Section 2. Materials and Equipment. The Bidder agrees to furnish and use in the construction of the project
under this Proposal, in the event the Proposal is accepted, only such "fully accepted, '' ''conditionally
accepted, '' and ''technically accepted'' materials and equipment which have been accepted by RUS as
indicated in the current RUS Informational Publication 202-1, ''List of Materials Acceptable for Use
on Systems of RUS Electrification Borrowers,'' including revisions adopted prior to the Bid Opening.
The use of "conditionally accepted" or "technically accepted" materials and equipment requires
prior consent by the Owner or Engineer.
The Bidder will purchase all materials and equipment outright and not subject to any conditional
sales agreements, bailment, lease or other agreement reserving unto the seller any right, title or
interest therein. All such materials and equipment shall be new.
Section 3. Description of Contract. The Notice and Instructions to Bidders, Plans, Specifications, and
Construction Drawings, which by this reference are incorporated herein, together with the Proposal
and Acceptance constitute the Contract. The Plans, Specifications, and Construction Drawings,
including maps, special drawings, and approved modifications in standard specifications are attached
hereto and identified as follows:

Section 4. Due Diligence. The Bidder has made a careful examination of the Plans, Specifications, and
Construction Drawings attached hereto, and has become informed as to the location and nature of the
proposed construction, the transportation facilities, the kind and character of soil and terrain to be
encountered, and the kind of facilities required before and during the construction of the project, and

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has become acquainted with the labor conditions, federal, state, and local laws, rules, and regulations
applicable to its performance.
Section 5. Warranty of Good Faith. The Bidder warrants that this Proposal is made in good faith and without
collusion or connection with any person or persons bidding for the same work.

ARTICLE II--DELIVERY AND WARRANTY
Section 1. Delivery. The Bidder shall deliver the Equipment:
within

days after receipt of the written order or orders of the Owner.

not later than

,20

The time for delivery shall be extended for the period of any reasonable delay due exclusively to
causes beyond the control and without the fault of the Bidder, including, but not limited to, acts of
God, fires, strikes, and floods.
Section 2. Defective Materials and Workmanship.
a.

All Equipment furnished hereunder shall be subject to the inspection, tests, and approval of the
Owner and the Engineer, and the Bidder shall furnish all information required concerning the
nature or source of any Equipment and provide adequate facilities for testing and inspecting the
Equipment at the plant of the Bidder.

b. The Equipment furnished hereunder shall become the property of the Owner upon delivery,
provided, however, that the Owner or the Engineer, within one year after initial operation of the
Equipment, or within the period for which the Equipment is guaranteed, whichever is longer, may
reject any Equipment which does not comply with the Specifications attached hereto and made a
part hereof or with the guarantees, if any, of the Bidder and the manufacturer. Upon any such
rejection, the Bidder shall repair or replace such defective Equipment within a reasonable time
after notice in writing from the Owner. If any such defective materials, equipment, or
workmanship so replaced or repaired is found to be defective within one year after the completion
of the replacement or repair, the Bidder shall replace or remedy such defective materials,
equipment, or workmanship. In the event of failure by the Bidder so to do, the Owner may make
such replacement and the cost and expense thereof shall be paid by and recoverable from the
Bidder.
c.

All manufacturers' guarantees of Equipment, if any, shall be transferred and assigned to the
Owner upon delivery of any Equipment and before final payment is made for such Equipment.
Such guarantees shall be in addition to those required of the Bidder by other provisions of this
Contract.

ARTICLE III-PAYMENT
Section 1. Payments to Bidder.
a.

Upon the shipment of any Equipment hereunder, the Bidder shall submit to the Owner a detailed
statement of the Equipment shipped. The Owner shall, upon receipt of the Equipment, pay the
Bidder ninety percent (90%) of the contract price of the Equipment. When the Equipment has
been installed, placed in satisfactory operation, tested and accepted by the Owner, the Owner
shall make final payments therefor to the Bidder; provided, however, such final payment
days after delivery of the
shall be made not later than
Equipment, unless such acceptance by the Owner shall be withheld because of the fault of the
Bidder.

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No payment shall be due while the Bidder is in default in respect of any of the provisions of this
Contract and the Owner may withhold from the Bidder the amount of any claim by a third party
against either the Bidder or the Owner based upon an alleged failure of the Bidder to perform the
work hereunder in accordance with the provisions of this Contract.

ARTICLE IV--PARTICULAR UNDERTAKINGS OF THE BIDDER
The provisions of this Article IV apply to any work performed by the Bidder at the project site.
Section 1. Protection to Persons and Property. The Bidder shall at all times take all reasonable precautions
for the safety of employees on the project and of the public, and shall comply with all applicable
provisions of federal, state, and local laws, rules, and regulations and building and construction
codes, in addition to the safety rules and procedures of the Owner.
The following provisions shall not limit the generality of the above requirements:
a.

The Bidder shall at no time and under no circumstances cause or permit any employee of the
Bidder to perform any work upon energized lines, or upon poles carrying energized lines, unless
otherwise specified in the Notice and Instructions to Bidders.

b.

The Bidder shall transport and store all material in facilities and vehicles which are designed to
protect the material from damage. The Bidder shall ensure that all vehicles, trailers, and other
equipment used comply with all applicable licensing, traffic, and highway requirements.

c.

The Bidder shall conduct its operations to cause the least possible obstruction of public highways.

d.

The Bidder shall make good and fully repair all injuries and damages to the project or any
portion thereof under the control of the Bidder by reason of any act of God or other casualty or
cause whether or not the same shall have occurred by reason of the Bidder's negligence.
(i) To the maximum extent permitted by law, Bidder shall defend, indemnify, and hold harmless
Owner and Owner's directors, officers, and employees from all claims, causes of action,
losses, liabilities, and expenses (including reasonable attorney's fees) for personal loss,
injury, or death to persons (including but not limited to Bidder's employees) and loss,
damage to or destruction of Owner's property or the property of any other person or entity
(including but not limited to Bidder's property) in any manner arising out of or connected
with the Contract, or the materials or equipment supplied or services performed by Bidder,
its subcontractors and suppliers of any tier. But nothing herein shall be construed as making
Bidder liable for any injury, death, loss, damage, or destruction caused by the sole
negligence of Owner.
(ii) To the maximum extent permitted by law, Bidder shall defend, indemnify, and hold harmless
Owner and Owner's directors, officers, and employees from all liens and claims filed or
asserted against Owner, its directors, officers, and employees, or Owner's property or
facilities, for services performed or materials or equipment furnished by Bidder, its
subcontractors and suppliers of any tier, and from all losses, demands, and causes of action
arising out of any such lien or claim. Bidder shall promptly discharge or remove any such
lien or claim by bonding, payment, or otherwise and shall notify Owner promptly when it has
done so. If Bidder does not cause such lien or claim to be discharged or released by
payment, bonding, or otherwise, Owner shall have the right (but shall not be obligated) to
pay all sums necessary to obtain any such discharge or release and to deduct all amounts so
paid from the amount due Bidder.
(iii) Bidder shall provide to Owner's satisfaction evidence of Bidder's ability to comply with the
indemnification provisions of subparagraphs i and ii above, which evidence may include but
may not be limited to a bond or liability insurance policy obtained for this purpose through a
licensed surety or insurance company.

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Upon violation by the Bidder of any of the provisions of this section, after written notice of such
violation given to the Bidder by the Engineer or the Owner, the Bidder shall immediately correct
such violation. Upon failure of the Bidder so to do the Owner may correct such violation at the
Bidder's expense: Provided, however, that the Owner may, if it deems it necessary or advisable,
correct such violation at the Bidder's expense without such prior notice to the Bidder.

Section 2. Insurance. The Bidder shall takeout and maintain throughout the period of its operations at the
project site the following types and minimum amounts of insurance:
a.

Workers' compensation and employers' liability insurance, as required by law, covering all its
employees who perform any of the obligations of the Bidder under the contract. If any employer
or employee is not subject to the workers' compensation laws of the governing state, then
insurance shall be obtained voluntarily to extend to the employer and employee coverage to the
same extent as though the employer or employee were subject to the workers' compensation laws.

b.

Public liability insurance covering all operations under the contract shall have limits for bodily
injury or death of not less than $1 million each occurrence, limits for property damage of not less
than $1 million each occurrence, and $1 million aggregate for accidents during the policy period.
A single limit of $1 million of bodily injury and property damage is acceptable. This required
insurance may be in a policy or policies of insurance, primary and excess including the umbrella
or catastrophe form.

c.

Automobile liability insurance on all motor vehicles used in connection with the contract, whether
owned, nonowned, or hired, shall have limits for bodily injury or death of not less than $1 million
per person and $1 million each occurrence, and property damage limits of $1 million for each
occurrence. A single limit of $1 million of bodily injury and property damage is acceptable. This
required insurance may be in a policy or policies of insurance, primary and excess including the
umbrella or catastrophe form.

The Owner shall have the right at any time to require public liability insurance and property damage
liability insurance greater than those required in subsection ''b '' and ''c '' of this Section. In any such
event, the additional premium or premiums payable solely as the result of such additional insurance
shall be added to the Contract price.
The Owner shall be named as Additional Insured on all policies of insurance required in subsections
''b '' and ''c '' of this Section.
The policies of insurance shall be in such form and issued by such insurer as shall be satisfactory to
the Owner. The Bidder shall furnish the Owner a certificate evidencing compliance with the foregoing
requirements which shall provide not less than (30) days prior written notice to the Owner of any
cancellation or material change in the insurance.

ARTICLE V--REMEDIES
Section 1. Liquidated Damages. The time of the delivery of the Equipment is of the essence of the Contract.
Should the Bidder neglect, refuse or fail to deliver the Equipment within the time herein agreed upon,
after giving effect to extensions of time, if any, herein provided, then, in that event and in view of the
difficulty of estimating with exactness damages caused by such delay, the Owner shall have the right
to deduct from and retain out of such moneys which may be then due, or which may become due and
payable to the Bidder the sum of
dollars (
) per day
for each and every day that such delivery is delayed beyond the specified time, as liquidated damages
and not as a penalty; if the amount due and to become due from the Owner to the Bidder is insufficient
to pay in full any such liquidated damages, the Bidder shall pay to the Owner the amount necessary to
effect such payment in full: Provided, however, that the Owner shall promptly notify the Bidder in
writing of the manner in which the amount retained, deducted or claimed as liquidated damages was
computed.
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Section 2. Cumulative Remedies. Every right or remedy herein conferred upon or reserved to the Owner or the
Government or the Administrator shall be cumulative, shall be in addition to every right and remedy
now or hereafter existing at law or in equity or by statute and the pursuit of any right or remedy shall
not be construed as an election: Provided, however, that the provisions of Section I of this Article
shall be the exclusive measure of damages for failure by the Bidder to deliver the Equipment within
the time herein agreed upon.

ARTICLE Vl--MISCELLANEOUS
Section 1. Definitions.
a.

The term ''Administrator'' shall mean the Administrator of the Rural Utilities Service of the
United States of America and his or her duly authorized representative or any other person in
whom or authority in which may be vested the duties and functions which the Administrator is
now authorized by law to perform.

b.

The term ''Engineer'' shall mean the Engineer employed by the Owner, to provide engineering
services for the project and said Engineer's duly authorized assistants and representatives.

Section 2. Materials and Supplies. In the performance of this contract there shall be furnished only such
unmanufactured articles, materials, and supplies as have been mined or produced in the United States
or in any eligible country, and only such manufactured articles, materials, and supplies as have been
manufactured in the United States or in any eligible country substantially all from articles, materials,
or supplies mined, produced or manufactured, as the case may be, in the United States or in any
eligible country; provided that other articles, materials, or supplies may be used in the event and to
the extent that the Administrator shall expressly in writing authorize such use pursuant to the
provisions of the Rural Electrification Act of 1938, being Title IV of Public Resolution No. 122, 75th
Congress, approved June 21, 1938. For the purposes of this section, an "eligible country" is any
country that applies with respect to the United States an agreement ensuring reciprocal access for
United States products and services and suppliers to the markets of that country, as determined by the
Unites States Trade Representative. The Bidder agrees to submit to the Owner such certificates with
respect to compliance with the foregoing provision as the Administrator from time to time may
require.
Section 3. Patent Infringement. The Bidder shall hold harmless and indemnify the Owner from any and all
claims, suits and proceedings for the infringement of any patent or patents covering Equipment
purchased hereunder.
Section 4. Compliance with Laws. The Bidder shall comply with all federal, state, and local laws, rules, and
regulations applicable to its performance under the contract and the construction of the project. The
Bidder acknowledges that it is familiar with the Rural Electrification Act of 1936, as amended, the
Anti Kick-Back Act of 1986 (41 U.S.C. 51 et seq), and 18 U.S.C. §§ 286, 287, 641, 661, 874, 1001,
and 1366, as amended.
The Bidder represents that to the extent required by Executive Orders 12549 (3 CFR, 1985-1988
Comp., p. 189) and 12689 (3 CFR, 1989 Comp., p. 235), Debarment and Suspension, and
7 CFR part 3017, it has submitted to the Owner a duly executed certification in the form prescribed in
7 CFR part 3017.
The Bidder represents that, to the extent required, it has complied with the requirements of
Pub. L. 101-121, Section 319, 103 Stat. 701, 750-765 (31 U.S.C. 1352), entitled ''Limitation on use of
appropriated funds to influence certain Federal contracting and financial transactions," and any
rules and regulations issued pursuant thereto.

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Section 5. Equal Opportunity Provisions.
a. Bidder's Representations.
The Bidder represents that:
It has
, does not have
, 100 or more employees, and if it has, that it has
, has not
,
furnished the Equal Employment Opportunity-Employers Information Report EEO-1, Standard
Form 100, required of employers with 100 or more employees pursuant to Executive Order 11246
of September 24, 1965, and Title VII of the Civil Rights Act of 1964.
The Bidder agrees that it will obtain, prior to the award of any subcontract for more than $10,000
hereunder to a subcontractor with 100 or more employees, a statement, signed by the proposed
subcontractor, that the proposed subcontractor has filed a current report on Standard Form 100.
The Bidder agrees that if it has 100 or more employees and has not submitted a report on
Standard Form 100 for the current reporting year and that if this Contract will amount to more
than $10,000, the Bidder will file such report, as required by law, and notify the Owner in writing
of such filing prior to the Owner's acceptance of this Proposal.
b.

Equal Opportunity Clause. During the performance of this Contract, the Bidder agrees as
follows:
(1) The Bidder will not discriminate against any employee or applicant for employment because
of race, color, religion, sex or national origin. The Bidder will take affirmative action to
ensure that applicants are employed, and that employees are treated during employment
without regard to their race, color, religion, sex or national origin. Such action shall
include, but not be limited to, the following: Employment, upgrading, demotions or transfer;
recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of
compensation; and selection of training, including apprenticeship. The Bidder agrees to post
in conspicuous places, available to employees and applicants for employment, notices to be
provided setting forth the provisions of this Equal Opportunity Clause.
(2) The Bidder will, in all solicitations or advertisements for employees placed by or on behalf of
the Bidder, state that all qualified applicants will receive consideration for employment
without regard to race, color, religion, sex or national origin.
(3) The Bidder will send to each labor union or representative of workers, with which it has a
collective bargaining agreement or other contract or understanding, a notice to be provided
advising the said labor union or workers' representative of the Bidder's commitments under
this section, and shall post copies of the notice in conspicuous places available to employees
and applicants for employment.
(4) The Bidder will comply with all provisions of Executive Order 11246 of September 24, 1965,
and the rules, regulations and relevant orders of the Secretary of Labor.
(5) The Bidder will furnish all information and reports required by Executive Order 11246 of
September 24, 1965, and by rules, regulations, and orders of the Secretary of Labor, or
pursuant thereto, and will permit access to its books, records, and accounts by the
administering agency and the Secretary of Labor for purposes of investigation to ascertain
compliance with such rules, regulations, and orders.
(6) In the event of the Bidder's noncompliance with the Equal Opportunity Clause of this
Contract or with any of the said rules, regulations, or orders, this Contract may be canceled,
terminated, or suspended in whole or in part, and the Bidder may be declared ineligible for
further Government contracts or federally assisted construction contracts in accordance with
procedures authorized in Executive Order 11246 of September 24, 1965, and such other
sanctions may be imposed and remedies invoked as provided in Executive Order 11246 of

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September 24, 1965, or by rule, regulation, or order of the Secretary of Labor, or as provided
by law.
(7) The Bidder will include this Equal Opportunity Clause in every subcontract or purchase
order unless exempted by the rules, regulations, or order of the Secretary of Labor issued
pursuant to Section 204 of Executive Order 11246 of September 24, 1965, so that such
provisions will be binding upon each subcontractor or vendor. The Bidder will take such
action with respect to any subcontract or purchase order as the administering agency may
direct as a means of enforcing such provisions, including sanctions for noncompliance;
Provided, however, that in the event Bidder becomes involved in, or is threatened with,
litigation with a subcontractor or vendor as a result of such direction by the administering
agency, the Bidder may request the United States to enter into such litigation to protect the
interests of the United States.
c. Certificate of Nonsegregated Facilities. The Bidder certifies that it does not maintain or provide
for its employees any segregated facilities at any of its establishments, and that it does not permit
its employees to perform their services at any location, under its control, where segregated
facilities are maintained. The Bidder certifies further that it will not maintain or provide for its
employees any segregated facilities at any of its establishments, and that it will not permit its
employees to perform their services at any location, under its control, where segregated facilities
are maintained. The Bidder agrees that a breach of this certification is a violation of the Equal
Opportunity Clause in this Contract. As used in this certification, the term "segregated facilities"
means any waiting rooms, work areas, restrooms and washrooms, restaurants and other eating
areas, timeclocks, locker rooms and other storage or dressing areas, parking lots, drinking
fountains, recreation or entertainment areas, transportation, and housing facilities provided for
employees which are segregated by explicit directive or are in fact segregated on the basis of
race, color, religion, or national origin, because of habit, local custom, or otherwise. The Bidder
agrees that (except where it has obtained identical certifications from proposed subcontractors
for specific time periods) it will obtain identical certifications from proposed subcontractors prior
to the award of subcontracts exceeding $10,000 which are not exempt from the provisions of the
Equal Opportunity Clause, and that it will retain such certifications in its files.
Section 6. Successors and Assigns. Each and all of the covenants and agreements herein contained shall extend
to and be binding upon the successors and assigns of the parties hereto. The Owner and Bidder
acknowledge that this Contract is assigned to the Government, acting through the Administrator, for
security purposes under the Owner's mortgage and security instrument.
Section 7. Independent Contractor. The Bidder shall perform the work as an independent contractor, not as a
subcontractor, agent, or employee of the Owner. Upon acceptance of this Proposal, the successful
Bidder shall be the Contractor and all references in the Proposal to the Bidder shall apply to the
Contractor.

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Section 8. Approval by the Administrator: This contract does
, does not
, require approval of the
Administrator. No acceptance of a Proposal for a contract upon which approval of the Administrator
is required shall become effective until the contract has been approved by the Administrator; provided
that no obligation shall arise hereunder unless such approval is given within one-hundred twenty
(120) days after the date set for the opening of the proposals. The acceptance of a Proposal for a
contract upon which approval of the Administrator is not required shall become effective the date of
acceptance by the Owner.

ATTEST:

Bidder

President

Secretary
Dated

Address
The Proposal must be signed with the full name of the Bidder. If the Bidder is a partnership, the Proposal must be
signed in the partnership name by a partner. If the Bidder is a corporation, the Proposal must be signed in the
corporate name by a duly authorized officer and the corporate seal affixed and attested by the Secretary of the
Corporation.

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ACCEPTANCE

Subject to the approval of the Administrator, if approval of the Administrator is required, the Owner
hereby accepts the foregoing Proposal of the Bidder,
for the following Equipment:

for a total contract price of $

dollars.)

(

Owner

By
President

Secretary
,20
Date of Contract

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