EXHIBIT 10.7
AGREEMENT
BETWEEN OWNER AND DESIGN/BUILDER ON THE BASIS OF A
STIPULATED PRICE
THIS AGREEMENT is made and entered into this 26th day of August, 20O4 by and
between Western Plains Energy, LLC, a Kansas limited liability company
(hereinafter called OWNER) and ICM, Inc., a Kansas corporation (hereinafter
called DESIGN/BUILDER).
OWNER and DESIGN/BUILDER, in consideration of the mutual covenants hereinafter
set forth, agree as follows:
Article 1. THE PROJECT AND WORK.
1.01. DESIGN/BUILDER shall complete all Work for the Project as specified or
indicated in the Contract Documents. The Project is generally described as the
expansion of the dry mill fuel-grade ethanol plant of OWNER located near Campus,
Kansas that increases the capacity of said plant from 30 million gallons per
year of denatured fuel-grade ethanol to 40 million gallons per year. The
DESIGN/BUILDER'S Work includes engineering services, labor, materials, and
equipment in connection with such expansion. A more specific statement of the
scope of work to be provided by DESIGN/BUILDER is described in Exhibits A and B.
Article 2. CONTRACT TIMES.
2.01. Days to Achieve Substantial Completion and Final Payment. The Work will be
Substantially Completed within 240 days after the date when the Contract Times
commence to run as provided in paragraph 2.01.A of the General Conditions, and
completed and ready for final payment of the Contract Price in accordance with
paragraph 13.08 of the General Conditions within 60 days after Substantial
Completion, unless otherwise provided in the Contract Documents.
Article 3. CONTRACT PRICE.
3.1. OWNER shall pay DESIGN/BUILDER the Contract Price for completion of the
Work in accordance with the Contract Documents. The Contract Price may be
adjusted as provided by the General Conditions. For all items included in the
Base Scope of Work, OWNER shall pay to DESIGN/BUILDER a price equal to Four
Million Dollars ($4,000,000). For those items listing in the Additional Scope of
work the owner shall pay Design/Builder a price equal to cost +10%.
DESIGN/BUILDER to provide budget to prior to starting work.
3.2. Unless otherwise expressly agreed by the parties, the Work to be performed
by DESIGN/BUILDER shall include only those items listed in Exhibits A and B.
Owner shall be responsible for any and all other items relating to such
expansion.
3.03 DESIGN/BUILDER agrees to maintain the insurance coverage's, limits, and
deductibles set forth in Exhibit D.
Article 4. PAYMENT PROCEDURES
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4.01 Payment of Contract Price. DESIGN/BUILDER shall submit and OWNER will
process Applications for Payment of the Contract Price in accordance with
Article 13 of the General Conditions and Sections 4.01.A. through C. below.
A. Down Payment. On or before delivery of the Notice to Proceed, OWNER
shall make a down payment of One Million Dollars ($1,000,000) to DESIGN/BUILDER.
B. Progress Payments. OWNER shall make progress payments on account of Two
Million Five Hundred Thousand Dollars ($2,750,000) of the Contract Price on the
basis of DESIGN/BUILDER'S Applications for Payment. Progress payments shall be
due and payable in accordance with 13.04 of the General Conditions. All such
payments will be measured by the acceptable Schedule of Values established under
paragraph 2.06.A of the General Conditions. No retainage will be withheld from
such payments.
C. Final Payment. OWNER shall pay the remaining Five Hundred Thousand
Dollars ($250,000.00) of the Contract Price to DESIGN/BUILDER in accordance with
paragraph 13.08 of the General Conditions.
Article 5. INTEREST.
5.01. All moneys not paid by OWNER to DESIGN/BUILDER when due hereunder shall
bear interest at the rate of Eighteen Percent (18%) per annum, compounded
monthly, from the due date thereof.
Article 6. DESIGN/BUILDER'S REPRESENTATIONS.
6.01. DESIGN/BUILDER makes the following representations:
A. DESIGN/BUILDER has examined and carefully studied the Contract Documents
listed in Sections 7.01.A through C, and, to the extent prepared (but not yet
approved by OWNER) prior to the Effective Date, the documents described in
Section 7.01.D.3 and .4.
B. DESIGN/BUILDER is familiar with and is satisfied as to all federal,
state and local Laws and Regulations in existence on the Effective Date that may
affect cost, progress, performance, furnishing, and completion of the Work in
accordance with the Contract Documents.
C. DESIGN/BUILDER is familiar with the work to be performed by OWNER and
others at the Site that relates to the Work as indicated in the Contract
Documents.
D. DESIGN/BUILDER has correlated the information known to DESIGN/BUILDER,
reports and drawings identified in the Contract Documents, and all additional
examinations, investigations, tests, studies and data with the Contract
Documents.
E. DESIGN/BUILDER has given OWNER written notice of all conflicts, errors,
ambiguities or discrepancies that DESIGN/BUILDER has discovered in the Contract
Documents and the written resolution thereof by OWNER is acceptable to
DESIGN/BUILDER, and the Contract Documents are sufficient to indicate and convey
understanding of all terms and conditions for performance and furnishing of the
Work.
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Article 7. CONTRACT DOCUMENTS.
7.01. The Contract Documents which comprise the entire agreement between OWNER,
and DESIGN/BUILDER concerning the Work consist of the following:
A. This Agreement (pages 1 to 4, inclusive).
B. Exhibits to this Agreement (A to D, inclusive).
C. General Conditions of the Contract Between Owner and Design/Builder
(pages 1 to 34, inclusive).
D. The following which may be delivered, prepared, or issued after the
Effective Date of this Agreement and are not attached hereto.
1. Notice to Proceed.
2. All Written Amendments and other documents amending, modifying or
supplementing the Contract Documents pursuant to paragraph 3.03.A of the General
Conditions.
3. Specifications as defined in paragraph 1.01.A.32 of the General
Conditions.
4. Drawings as defined in paragraph 1.01.A.16 of the General Conditions.
7.02. There are no Contract Documents other than those listed above in this
Article 7. The Contract Documents may only be amended, modified or supplemented
as provided in paragraph 3.03.A of the General Conditions.
Article 8. MISCELLANEOUS.
8.1. The attached General Conditions of the Contract between Owner and
Design/Builder are referred to herein as the General Conditions.
8.2. Terms used in this Agreement which are defined in Article 1 of the General
Conditions will have the meanings indicated therein.
8.3. No assignment by a party hereto of any rights under or interests in the
Contract Documents will be binding on another party hereto without the written
consent of the party sought to be bound, which consent shall not be unreasonably
withheld; and, specifically but without limitation, moneys that may become due
and moneys that are due may not be assigned without such consent (except to the
extent that the effect of this restriction may be limited by law), and unless
specifically stated to the contrary in any written consent to an assignment no
assignment will release or discharge the assignor from any duty or
responsibility under the Contract Documents.
8.4. OWNER and DESIGN/BUILDER each binds itself, its successors, assigns and
legal representatives to the other party hereto, its successors, assigns and
legal representatives in respect to all covenants, agreements and obligations
contained in the Contract Documents.
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8.5. Any provision or part of the Contract Documents held to be void or
unenforceable under any Law or Regulation shall be deemed stricken, and all
remaining provisions shall continue to be valid and binding upon OWNER and
DESIGN/BUILDER, who agree that the Contract Documents shall be reformed to
replace such stricken provision or part thereof with a valid and enforceable
provision that comes as close as possible to expressing the intention of the
stricken provision.
8.6. This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original and all of which shall constitute one
agreement that is binding upon all of the parties hereto, notwithstanding that
all parties are not signatories to the same counterpart. Facsimile signatures of
the parties hereto shall be binding.
8.7. This Agreement will be effective on the date first written above. Within
sixty (60) days of such effective date, OWNER shall provide to DESIGN/BUILDER
the Notice to Proceed and evidence, acceptable to DESIGN/BUILDER, of funding for
the Project.
IN WITNESS WHEREOF, OWNER and DESIGN/BUILDER have signed this Agreement on the
date first written above.
OWNER: Western Plains Energy, LLC DESIGN/BUILDER: ICM, Inc.
By: /s/ Xxxxxxx X. Xxxxxx By: /s/ Xxxx Xxxxxx Griend
----------------------- ----------------------
Title: CEO/General Manager Title: CEO
Addresses for giving notices and representatives:
Name: Xxxxxxx X. Xxxxxx Name: Xxxx Xxxxxx Griend
Title: CEO/General Manager Title: CEO
Address: 0000 Xxxxxx Xx 00, Xxxxxx, XX Address: 000 X. Xxxxx Xxxxxx
Xxxxxxx, XX
Phone: 000-000-0000 Phone: 000-000-0000
Facsimile: 000-000-0000 Facsimile: 000-000-0000 JDJ
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Exhibit A
to
Agreement Between Owner and Design/Builder On the Basis
of a Stipulated Price
Performance Criteria
DESIGN/BUILDER represents and warrants to OWNER that the completed Project
will satisfy the following performance criteria. Prior to final payment under
paragraph *13.08 of the General Conditions, DESIGN/BUILDER shall commission the
Project and conduct a seven-day performance test to establish compliance with
the following performance criteria. Compliance shall be computed on the average
over the seven-day performance test. If the Project fails to reach such
performance criterion, then DESIGN/BUILDER shall (at no additional cost to
OWNER) make such changes in design, construction, or equipment as required to
meet the criterion, and conduct another seven day performance test.
DESIGN/BUILDER makes no other representation, warranty or guarantee concerning
the Project including, without limitation, production of DDGS or CO2, or
compliance with any applicable atmospheric emissions standards.
Table 1 ethanol plant criteria --40 MGY capacity
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Criteria | Specification | Testing Statement | Documentation |
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Plant Capacity - | Capable of operating | Ten day | Concurrence of |
fuel-grade ethanol | at a rate of 40 | performance test. | production records |
| million gallons per | Protocol to be | and a written report|
| year of denatured | agreed upon by | from |
| fuel grade ethanol | DESIGN BUILDER | DESIGN/BUILDER. |
| meeting the | and OWNER. | |
| specifications of | | |
| ASTM 4806 | | |
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Exhibit B
to
Agreement Between Owner and Design/Builder On the Basis
of a Stipulated Price
Items Included in Base Scope of Work:
1. Beerwell addition:
a. Provide and install all necessary foundations, piping, and tank
to add one 750,000 gallon tank to be used as a beerwell.
b. Provide and install new pump and associated piping necessary for
new beerwell.
2. Cooling tower expansion:
a. Provide and install all necessary foundations, piping, and
cooling tower to expand to three cells.
b. Provide and install new cooling tower pump.
3. Centrifuge:
a. Provide and install one "Z6" model Flottweg centrifuge with all
associated piping. Currently WPE has "Z53" model centrifuges
installed. The up sizing to a Z6 would be to allow more
flexibility in process.
4. Fourth eductor in slurry tank:
a. Provide and install 4th steam eductor in slurry tank.
b. Provide and install CIP lines for fermenter #4.
5. Fermenter #4 modifications:
a. Provide and install new pump and heat exchanger for fermenter #4.
6. Scalper:
a. Provide and install necessary equipment to change scalper to
rotary scalper in current location. Any additional modifications
at owners cost.
7. RO water to lab:
a. Provide RO water to lab. Water is to be available when pump is
running. Installation of a dedicated pump is at owners cost.
8. Sulfuric Acid Line to RO System:
a. Provide and install Alloy 20 acid line to RO.
9. Xxxx water pre-heater:
a. Provide necessary changes or improvements to xxxx water
pre-heater. (45 mmgpy rate)
b. Provide and install sulfamic acid line to xxxx water pre-heater.
If alloy 20, WPE purchases material.
10. Pumps and Heat exchangers:
a. Provide and install necessary improvements to heat exchangers and
pumps as approve by engineering for expansion and approved by
owner.
Items Included in Additional Scope of work
1. Sulfuric Acid Tank
a. Provide and install a second sulfuric acid tank with associated
piping & equipment.
2. Slurry Tank
a. Provide and install modifications to convert slurry tank to 2
stages, this includes the new agitator.
3. Tank Farms
a. Provide and install a second ethanoi loadout pump with necessary
piping, valves, and instruments to allow simultaneous truck &
rail loadout.
b. Provide and install piping needed to bypass the denaturant pump
during railcar off-loading.
DESIGN/BUILDER proposes to provide engineering, equipment, and installation for
the above described items for OWNER. Anything not listed above is OWNER'S
responsibility, including but not limited to:
1. Any pump or heat exchanger modifications that are not required or
approved by engineering.
2. Additional piping that is approved but not described above.
3. Ethanol loading changes.
4. Any wet cake pad modifications.
5. Any other additional tanks or vessels not described above.
6. Any grain system modifications not described above.
7. Start up assistance
Exhibit C
to
Agreement Between Owner and Design/Builder On the
Basis of a Stipulated Price
LICENSE OF PROPRIETARY PROPERTY OF DESIGN/BUILDER
OWNER expressly understands, acknowledges and agrees that:
1. DESIGN/BUILDER is using certain technology and information in the design
and construction of the Project which is more fully described in paragraphs
3 and 4 below (the "PROPRIETARY PROPERTY").
2. Upon OWNER'S payment to DESIGN/BUILDER of the entire Contract Price, OWNER
shall be granted a perpetual limited license to use the PROPRIETARY
PROPERTY in connection with OWNER'S operations of the Project, subject to
the limitations provided herein. In the event the Agreement is terminated
for any reason under Article 14 of the General Conditions prior to payment
of the entire Contract Price, OWNER shall be granted a perpetual limited
license to use the PROPRIETARY PROPERTY in connection with OWNER'S
operations of the Project, subject to the limitations provided herein, upon
payment in full by OWNER to DESIGN/BUILDER of (i) all amounts due and
payable to DESIGN/BUILDER under the Contract Documents.
3. The PROPRIETARY PROPERTY includes, without limitation, OPERATING PROCEDURES
(hereinafter defined), operating methods, techniques, protocols,
procedures, plans and processes, and other information relating to design,
construction and operation of the Project including the design,
arrangement, configuration and specifications of (i) the combinations of
distillation, evaporation and alcohol dehydration equipment (including, but
not limited to, pumps, vessels, tanks, heat exchangers, piping, values and
associated electronic control equipment) and all documents supporting those
combinations; (ii) the combination of the distillers grain drying (DGD),
thermal oxidization (TO) and heat recovery steam generation (HRSG)
equipment (including, but not limited to, pumps, vessels, tanks, heat
exchangers, piping and associated electronic control equipment) and all
documents supporting those combinations; and (iii) the Project computer
system, known as the distributed control system (DCS) (including, but not
limited to, the software configuration, programming, parameters, set
points, alarm points, ranges, graphical interface and system hardware
connections) and all documents supporting that system. The "OPERATING
PROCEDURES" include, without limitation, the process equipment and
specifications manuals, standards of quality, service, protocols, data
collection methods, construction specifications, training methods,
engineering standards, advertising or promotional materials, and any other
information prescribed by DESIGN/BUILDER from time to time concerning the
PROPRIETARY PROPERTY.
4. DESIGN/BUILDER has the exclusive right and interest in and to the
PROPRIETARY PROPERTY and the goodwill associated therewith. Notwithstanding
the foregoing, goodwill created by the operation of the Project and all
financial benefits derived
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therefrom shall be the property of OWNER.
5. OWNER considers the PROPRIETARY PROPERTY to be valid and will not directly
or indirectly, contest the validity or the ownership by DESIGN/BUILDER
thereof.
6. OWNER'S use of the PROPRIETARY PROPERTY does not give OWNER any ownership
interest or other interest in or to the PROPRIETARY PROPERTY except for the
limited license granted to OWNER.
7. Except as otherwise provided in paragraph 2 above, OWNER shall not pay any
separate license fee or royalty to DESIGN/BUILDER for OWNER'S continual use
of the PROPRIETARY PROPERTY pursuant to the limited license granted to
OWNER, the consideration for this license is included in the Contract Price
payable to DESIGN/BUILDER under the Contract Document.
8. OWNER'S failure to materially comply with the OPERATING PROCEDURES shall
void all representations and warranties set forth in Exhibit A to the
Agreement relating to the performance of the Project.
9. The limited license granted to OWNER shall not be assigned or sublicensed,
in whole or in part, without the prior written consent of DESIGN/BUILDER,
which consent will not be unreasonably withheld. Prior to any such
assignment or sublicense, OWNER shall obtain from such assignee or
sublicensee an agreement to be bound by all of the provisions contained
herein, in form and substance acceptable to DESIGN/BUILDER.
10. The PROPRIETARY PROPERTY is confidential and proprietary. OWNER shall keep
the PROPRIETARY PROPERTY confidential, and shall use all reasonable efforts
to maintain the PROPRIETARY PROPERTY as secret and confidential. OWNER
shall not at any time without DESIGN/BUILDER's prior written consent, copy,
duplicate, record or otherwise reproduce the PROPRIETARY PROPERTY, in whole
or in part, or otherwise make the same available to any unauthorized
person. OWNER agrees that DESIGN/BUILDER would be irreparably damaged by
reason of any violation of the confidentiality provisions contained herein
and that any remedy at law for a breach of such provisions would be
inadequate. Therefore, DESIGN/BUILDER shall be entitled to seek injunctive
or other equitable relief in a court of competent jurisdiction against
OWNER, its agents, employees, affiliates, partners, members, stockholders,
officers or other associates, for any breach or threatened breach of the
confidentiality covenants contained herein without the necessity of proving
actual monetary loss. It is expressly understood that the remedy described
herein shall not be the exclusive remedy of DESIGN/BUILDER for any breach
of such covenants, and DESIGN/BUILDER shall be entitled to seek such other
relief or remedy, at law or in equity, to which it may be entitled as a
consequence of any breach of such covenants.
11. Nothing herein or the AGREEMENT shall be interpreted or construed as
granting OWNER a license or right to use the PROPRIETARY PROPERTY in the
design or construction of any enlargement or expansion of the Project.
12. The laws of the State of Kansas shall govern the validity of the provisions
contained herein, the construction of such provisions, and the
interpretation of the rights and duties of the parties. Any legal action
brought to enforce or construe the provisions of this Exhibit shall be
brought in courts located in Kansas, and the parties agree to the exclusive
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jurisdiction of such courts and agree that they will not invoke the
doctrine of forum non conveniens or other similar defenses.
13. The provisions of this Exhibit shall survive the termination or expiration
of the Contract Documents
The foregoing provisions are part of, and incorporated into, the Agreement and
should be interpreted consistently therewith. Unless otherwise defined herein or
unless the context otherwise requires, capitalized terms used herein shall have
the meaning given to such terms in the Contract Documents. In the event any of
the foregoing provisions is contrary to any provision in the Agreement (or any
other document referenced therein), the foregoing provision shall supercede and
have precedence over such contrary provision.
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GENERAL CONDITIONS OF THE
CONTRACT BETWEEN
OWNER AND
DESIGN/BUILDER
ARTICLE 1-DEFINITIONS
1. 01 Defined Terms
A. Wherever used in these General Conditions or in the other Contract
Documents the following terms have the meanings indicated which are applicable
to both the singular and plural thereof:
1. Agreement--The Agreement Between Owner and Design/Builder on the Basis
of a Stipulated Price covering the Work. Other Contract Documents are
incorporated into the Agreement and made a part thereof as provided
therein.
2. Application for Payment--The form which is to be used by DESIGN/BUILDER
in requesting progress or final payments and which is to be accompanied by
such supporting documentation as is required by the Contract Documents.
3. Asbestos--Any material that contains more than one percent (1%) asbestos
and is friable or is releasing asbestos fibers into the air above current
action levels established by the United States Occupational Safety and
Health Administration.
4. Bonds--Performance and payment bonds and other instruments of security.
5. Cash Flow Projection--A schedule prepared by DESIGN/BUILDER estimating
that portion of the Contract Price to be due during each month of
performance.
6. Change Order-A written order which is signed by DESIGN/BUILDER and OWNER
which authorizes an addition, deletion or revision in the Work, or an
adjustment in the Contract Price or the Contract Times, issued on or after
the Effective Date of the Agreement.
7. Construction--The performing or furnishing of labor, the furnishing and
incorporating of materials and equipment into the Work and the furnishing
of services (other than Design Professional Services) and documents, all as
required by the Contract Documents. Construction includes the materials and
equipment incorporated into the Project.
8. Construction Subagreement--A written agreement between DESIGN/BUILDER
and a construction contractor for provision of Construction.
9. Contract Documents--The Agreement and related exhibits, the Notice to
Proceed, these General Conditions, the Specifications and the Drawings
together with all Change Orders, and Written Amendments, issued on or after
the Effective Date of the Agreement.
10. Contract Price-The moneys payable by OWNER to DESIGN/BUILDER for
completion of the Work in accordance with the Contract Documents.
11. Contract Times--The number of days or the dates stated in the Agreement
(i) to achieve Substantial Completion, and (ii) to complete the Work so
that it is ready for final payment of the Contract Price in accordance with
paragraph 13.08.
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12. defective--An adjective which when modifying the term Construction
refers to Construction that is unsatisfactory, faulty or deficient, in that
it does not conform to the Contract Documents, or does not meet the
requirements of any inspection, reference standard, test or approval
referred to in the Contract Documents, or has been damaged prior to OWNER'S
final payment.
13. DESIGN/BUILDER-ICM, Inc., a Kansas corporation.
14. Design Subagreement--A written agreement between DESIGN/BUILDER and a
design professional for provision of Design Professional Services.
15. Design Professional Services--Services provided by or for licensed
design professionals during Construction, or operational phases of the
Project, including the development of drawings, Specifications, and other
design submittals specified by the Contract Documents and required to be
performed by licensed design professionals..
16. Drawings--Those portions of the Contract Documents prepared by or for
DESIGN/BUILDER and approved by OWNER consisting of drawings, diagrams,
illustrations, schedules and other data which show the scope, extent, and
character of the Work.
17. Effective Date of the Agreement--The date indicated in the Agreement on
which it becomes effective, but if no such date is indicated it means the
date on which the Agreement is signed and delivered by the last of the two
parties to sign and deliver.
18. Engineer--A duly licensed individual or entity designated by
DESIGN/BUILDER to perform or furnish specified Design Professional Services
in connection with the Work.
19. Hazardous Condition--The presence at the Site of Asbestos, Hazardous
Waste, PCB's, Petroleum Products or Radioactive Materials in such
quantities or circumstances that there is a danger to persons or property.
20. Hazardous Waste--The term Hazardous Waste shall have the meaning
provided in Section 1004 of the Solid Waste Disposal Act (42 USC Section
6903).
21. Laws and Regulations; Laws or Regulations--Any and all applicable laws,
rules, regulations, ordinances, codes, permits, and orders of any and all
governmental bodies, agencies, authorities and courts having jurisdiction.
22. Liens--Charges, security interests or encumbrances upon real property
or personal property.
23. Notice to Proceed-A written notice given by OWNER to DESIGN/BUILDER
fixing the date on which the Contract Times will commence to run.
24. OWNER-The public body, or authority, individual or entity with whom
DESIGN/BUILDER has entered into the Agreement and for whom the Work is to
be provided.
25. PCBs--Polychlorinated biphenyls.
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26. Petroleum--Petroleum, including crude oil or any fraction thereof which
is liquid at standard conditions of temperature and pressure (60 degrees
Fahrenheit and 14.7 pounds per square inch absolute), such as oil,
petroleum, fuel oil, oil sludge, oil refuse, gasoline, kerosene, and oil
mixed with other non-Hazardous Wastes and crude oils.
27. Project--The Construction to be provided under the Contract Documents
as provided in paragraph 1.01 of the Agreement.
28. Radioactive Material--Source, special nuclear, or byproduct material as
defined by the Atomic Energy Act of 1954 (42 USC Section 2011 et seq.) as
amended from time to time.
29. Schedule of Values-A schedule prepared by DESIGN/BUILDER and acceptable
to OWNER indicating that portion of the Contract Price to be paid for each
major component of the Work.
30. Site--Lands or other areas designated in the Contract Documents as
being furnished by OWNER for the performance of the Construction, storage,
or access.
31. Specifications--Those portions of the Contract Documents prepared by or
for DESIGN/BUILDER and approved by OWNER consisting of written technical
descriptions of materials, equipment, construction systems, standards and
workmanship as applied to the Construction and certain administrative
details applicable thereto.
32. Subcontractor--An individual or entity other than a Supplier or
Engineer having a direct contract with DESIGN/BUILDER or with any other
Subcontractor for the performance of a part of the Work.
33. [not used]
34. Substantial Completion--The time at which the Construction (or a
specified part) has progressed to the point where it is sufficiently
complete, in accordance with the Contract Documents, so that ethanol can be
produced at the capacity of 40 million gallons per year. The terms
"substantially complete" and "substantially completed" as applied to the
Construction refer to Substantial Completion of Construction.
35. Supplier--A manufacturer, fabricator, supplier, distributor,
materialman or vendor having a direct contract with DESIGN/BUILDER or with
any Subcontractor to furnish materials or equipment to be incorporated in
the Work by DESIGN/BUILDER or any Subcontractor.
36. Work--The entire completed construction or the various separately
identifiable parts thereof required to be performed or furnished under the
Contract Documents. Work includes and is the result of performing or
furnishing Design Professional Services and Construction required by the
Contract Documents.
37. Written Amendment--A written amendment of the Contract Documents,
signed by OWNER and DESIGN/BUILDER on or after the Effective Date of the
Agreement and normally dealing with the nonengineering or nontechnical
rather than strictly design or construction-related aspects of the Contract
Documents.
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ARTICLE 2--PRELIMINARY MATTERS
2.01 Commencement of Contract Times; Notice to Proceed
A. The Contract Times will commence to run on the day indicated in the
Notice to Proceed. A Notice to Proceed may be given at any time within the
period of time set forth in Section 9.07 of the Agreement.
2.02 Starting the Work
A. DESIGN/BUILDER shall start to perform the Work on the date when the
Contract Times commence to run.
2.03 Before Starting Construction
A. DESIGN/BUILDER shall submit the following for review within ten (10)
days after commencement of the Contract Times:
1. A preliminary progress schedule indicating the times (number of days or
dates) for starting and completing the various stages in the design and
construction of the Work;
2. A preliminary Schedule of Values for all of the Work, which will include
quantities and prices of items aggregating the Contract Price and will
subdivide the Work into component parts in sufficient detail acceptable to
OWNER to serve as the basis for progress payments during performance of the
Work. Such prices will include a pro rata amount of overhead and profit
applicable to each item of Work; and
3. A preliminary Cash Flow Projection.
B. Before any Work is started, DESIGN/BUILDER and OWNER shall each deliver
to the other, with copies to each additional insured, certificates of insurance
(and other evidence of insurance which either of them or any additional insured
may reasonably request) which DESIGN/BUILDER and OWNER respectively are required
to purchase and maintain in accordance with paragraphs 5.02.A, 5.04.A and
5.04.B.
2.04 Initial Conference
A. Within twenty (20) days after the Contract Times start to run, a
conference by telephone or in person with OWNER, DESIGN/BUILDER and others as
appropriate will be held to establish a working understanding among the parties
as to the Work and to discuss the design concepts, schedules referred to in
paragraph 2.03.A, processing Applications for Payment, maintaining required
records, items required pursuant to paragraph 8.01.A.6 and other matters.
2.05 Initially Acceptable Schedules
A. At least ten (10) days before submission of the first Application for
Payment a conference by telephone or in person with DESIGN/BUILDER, OWNER and
others as appropriate will be held to review for acceptability the schedules
submitted in accordance with paragraph 2.03.A. DESIGN/BUILDER shall have an
additional ten (10) days to make corrections and adjustments and to complete and
resubmit the
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schedules. No progress payment shall be made to DESIGN/BUILDER until the
schedules are submitted to and acceptable to OWNER as provided below. The
progress schedule will be acceptable to OWNER as providing an orderly
progression of the Work to completion within the Contract Times, but such
acceptance will neither impose on OWNER responsibility for the sequencing,
scheduling or progress of the Work nor interfere with or relieve DESIGN/BUILDER
from DESIGN/BUILDER's full responsibility therefor. The format and structure of
the progress schedule will be acceptable to OWNER. OWNER'S acceptance shall not
be deemed to confirm that the schedule is a reasonable plan for performing the
Work. DESIGN/BUILDER's Schedule of Values and Cash Flow Projection will be
acceptable to OWNER as to form and substance.
ARTICLE 3-CONTRACT DOCUMENTS: INTENT, AMENDING, REUSE
3.01 Intent
A. The Contract Documents comprise the entire agreement between OWNER and
DESIGN/BUILDER concerning the Work. The Contract Documents are complementary;
what is called for by one is as binding as if called for by all. The Contract
Documents will be construed in accordance with the laws of the State of Kansas.
Except as otherwise required by applicable Laws and Regulations, the Contract
Documents shall govern the obligations of the parties regarding the Work and
Project.
B. It is the intent of the Contract Documents to describe a functionally
complete Project to be designed and constructed in accordance with the Contract
Documents. Any Work, materials or equipment that may reasonably be inferred from
the Contract Documents or from prevailing custom or trade usage as being
required to produce the intended result will be furnished and performed whether
or not specifically called for. When words or phrases which have a well-known
technical or construction industry or trade meaning are used to describe work,
materials or equipment, such words or phrases shall be interpreted in accordance
with that meaning.
3.02 References
A. Reference to standards, specifications, manuals or codes of any
technical society, organization or association, or to the Laws or Regulations of
any governmental authority, whether such reference be specific or by
implication, shall mean the latest standard, specification, manual, code or Laws
or Regulations in effect on the Effective Date of the Agreement except as may be
otherwise specifically stated in the Contract Documents.
B. No provision of any standard, specification, manual, code or instruction
shall be effective to change the duties and responsibilities of OWNER,
DESIGN/BUILDER or any of their subcontractors, consultants, agents, or employees
from those set forth in the Contract Documents, nor shall it be effective to
assign to OWNER any duty or authority to supervise or direct the furnishing or
performance of the Work or any duty or authority to undertake responsibility
inconsistent with the provisions of Article 8 or any other provision of the
Contract Documents.
3.03 Amending and Supplementing Contract Documents
A. The Contract Documents may be amended to provide for additions,
deletions and revisions in the Work or to modify the terms and conditions
thereof in one or more of the following ways:
5
1. A Change Order; or
2. A formal Written Amendment.
6
3.04 Reuse of Documents
A. All documents including Drawings and Specifications prepared or
furnished by DESIGN/BUILDER pursuant to the Contract Documents are instruments
of service in respect of the Project and DESIGN/BUILDER shall retain an
ownership and property interest therein whether or not the Project is completed.
OWNER may make and retain copies for information and reference in connection
with the use and occupancy of the Project by OWNER and others; however, such
documents are not intended or represented to be suitable for reuse by OWNER or
others on extensions of the Project or on any other project. Any reuse without
written verification or adaptation by DESIGN/BUILDER for the specific purpose
intended will be at OWNER'S sole risk and without liability or legal exposure to
DESIGN/BUILDER, and OWNER shall indemnify and hold harmless DESIGN/BUILDER,
Subcontractors, and Engineer from all claims, damages, losses and expenses
including attorneys' fees arising out of or resulting therefrom. Any such
verification or adaptation will entitle DESIGN/BUILDER to further compensation
at rates to be agreed upon by OWNER and DESIGN/BUILDER.
B. In addition to paragraph 3.04.A, all documents including Drawings and
Specifications prepared or furnished by DESIGN/BUILDER pursuant to the Contract
Documents are subject to the use and disclosure restrictions set forth in
Exhibit C attached to the Agreement. Nothing contained in paragraph 3.04.A.
shall be construed or interpreted as granting OWNER any rights or interest in
the PROPRIETARY PROPERTY (as defined in Exhibit C) other than as expressly
provided in Exhibit C attached to the Agreement.
ARTICLE 4--AVAILABILITY OF LANDS; DIFFERING SITE CONDITIONS; REFERENCE POINTS;
HAZARDOUS CONDITIONS
4.01 Availability of Lands
A. OWNER shall furnish, as indicated in the Contract Documents, the lands
upon which the Construction is to be performed, rights-of-way and easements for
access thereto, and such other lands which are designated for the use of
DESIGN/BUILDER.
B. Upon reasonable written request, OWNER shall furnish DESIGN/BUILDER with
a correct statement of record legal title and legal description of the lands
upon which the Construction is to be performed and OWNER'S interest therein.
OWNER shall identify any encumbrances or restrictions not of general application
but specifically related to use of lands so furnished with which DESIGN/BUILDER
will have to comply in performing the Work. Easements for permanent structures
or permanent changes in existing facilities will be obtained and paid for by
OWNER, unless otherwise provided in the Contract Documents.
C. OWNER shall provide any of its lands and access thereto that may be
required for temporary construction facilities or storage of materials and
equipment.
4.02 Differing Site Conditions
A. DESIGN/BUILDER shall promptly, and before the conditions are disturbed,
give a written notice to OWNER of (i) subsurface or latent physical conditions
at the Site which differ materially from those indicated in the OWNER'S
geotechnical report for the Project site or the land and grading specifications
required by DESIGN/BUILDER, or (ii) unknown physical conditions at the Site, of
an unusual nature,
7
which differ materially from those ordinarily encountered and generally
recognized as inhering in work of the character called for by the Contract
Documents.
B. OWNER will investigate the site conditions promptly after receiving the
notice. If the conditions do materially so differ and cause an increase or
decrease in the DESIGN/BUILDER's cost of performing any part of the Work, an
equitable adjustment shall be made under this clause and the Contract Price
modified in writing by Change Order in accordance with Article 9.
C. No request by DESIGN/BUILDER for an equitable adjustment under paragraph
4.02 shall be allowed unless DESIGN/BUILDER has given the written notice
required; provided that the time prescribed in paragraph 9.02.A for giving
written notice may be extended by OWNER.
4.03 Reference Points
A. DESIGN/BUILDER shall be responsible for laying out the construction and
shall protect and preserve the reference points established by OWNER pursuant to
paragraph 8.01.A.6.e and shall make no changes or relocations without the prior
written approval of OWNER. DESIGN/BUILDER shall report to OWNER whenever any
reference point or property monument is lost or destroyed or requires relocation
because of necessary changes in grades or locations, and shall be responsible
for the accurate replacement or relocation of such reference points or property
monuments by professionally qualified personnel.
4.04 Hazardous Conditions
A. OWNER represents and warrants that there is no Hazardous Condition or
materials that could create a Hazardous Condition existing at the Site as of the
Effective Date of the Agreement and that OWNER will be responsible for any
Hazardous Condition encountered at the Site which was not identified )in the
Contract Documents to be within the scope of the Work. OWNER shall not be
responsible for materials creating a Hazardous Condition brought to the Site by
DESIGN/BUILDER, Subcontractors, Suppliers or anyone else for whom DESIGN/BUILDER
is responsible.
B. DESIGN/BUILDER and any affected Subcontractor shall immediately (i) stop
all Construction in connection with such Hazardous Condition and in any area
affected thereby (except in an emergency as required by paragraph 6.15), and
(ii) notify OWNER (and thereafter confirm such notice in writing). OWNER shall
promptly determine the necessity of retaining a qualified expert to evaluate
such Hazardous Condition or take corrective action, if any. DESIGN/BUILDER shall
not be required to resume Construction in connection with such Hazardous
Condition or in any such affected area until after OWNER has obtained any
required permits related thereto and delivered to DESIGN/BUILDER special written
notice (i) specifying that such Hazardous Condition and any affected area is or
has been rendered safe for the resumption of Construction, or (ii) specifying
any special conditions under which such Construction may be resumed safely. If
OWNER and DESIGN/BUILDER cannot agree as to entitlement to or the amount or
extent of an adjustment, if any, in Contract Price as a result of such
Construction stoppage or such special conditions under which Construction is
agreed by DESIGN/BUILDER to be resumed, either party may make a claim therefor
as provided in Article 9.
C. To the fullest extent permitted by Laws and Regulations, OWNER shall
indemnify and hold harmless DESIGN/BUILDER, Subcontractors, Suppliers, Engineers
and the officers, directors, employees, agents, other consultants and
subcontractors of each and any of them from and against all claims, costs,
losses and damages (including but not limited to all reasonable fees and charges
of engineers, architects,
8
attorneys and other professionals and all court.or arbitration or other dispute
resolution costs) arising out of or resulting from such Hazardous Condition.
Nothing in this paragraph 4.04.C shall obligate OWNER to indemnify any
individual or any entity, including DESIGN/BUILDER, from and against the
consequences of that individual's or entity's own negligence or willful
misconduct. OWNER shall not be obligated to indemnify or hold harmless
DESIGN/BUILDER, Subcontractors, Suppliers or any other individual or any entity
for any such claim, cost, loss or damage arising out of or resulting from
materials creating a Hazardous Condition brought to the Site by DESIGN/BUILDER,
Subcontractors, Suppliers or any other party for whom DESIGN/BUILDER is
responsible.
ARTICLE 5--BONDS AND INSURANCE
5.01 Performance, Payment and Other Bonds
A. DESIGN/BUILDER shall not be required to furnish a performance, payment
or any other Bonds.
5.02 DESIGN/BUILDER's Liability Insurance
A. DESIGN/BUILDER shall purchase and maintain such Commercial General
Liability (subject to customary exclusions in respect of professional
liability), Automobile Liability and Worker's Compensation insurance as is
appropriate for the Work being performed and furnished and as will provide
protection from claims set forth below which may arise out of or result from
DESIGN/BUILDER's performance and furnishing of the Work and DESIGN/BUILDER's
other obligations under the Contract Documents, whether it is to be performed or
furnished by DESIGN/BUILDER, any Subcontractor or Supplier, or by anyone
directly or indirectly employed by any of them to perform or furnish any of the
Work, or by anyone for whose acts any of them may be liable:
1. Claims under workers' compensation, disability benefits and other
similar employee benefit acts;
2. Claims for damages because of bodily injury, occupational sickness
or disease, or death of DESIGN/BUILDER's employees;
3. Claims for damages because of bodily injury, sickness or disease,
or death of any person other than DESIGN/BUILDER's employees;
4. Claims for damages insured by customary personal injury liability
coverage which are sustained (i) by any person as a result of an offense
directly or indirectly related to the employment of such person by
DESIGN/BUILDER, or (ii) by any other person for any other reason;
5. Claims for damages, other than to the Work itself, because of
injury to or destruction of tangible property wherever located other than
claims under paragraph 5.02.A.7. below, including loss of use resulting
therefrom;
6. Claims for damages because of bodily injury or death of any person
or property damage arising out of the ownership, maintenance or use of any
motor vehicle; and
7. Claims for professional errors and omissions arising from the
Design Professional Services provided for the Project.
9
B. The policies of insurance required by paragraph 5.02.A shall:
1. With respect to insurance required by paragraphs 5.02.A.3 through
5.02.A.6 inclusive, include as additional insureds OWNER and any other
persons or entities identified in writing by OWNER, all of whom shall be
listed as additional insureds, and include coverage for the respective
officers and employees of all such additional insureds;
2. Include at least the specific coverages and be written for not less than
the limits of liability set forth in Exhibit D or required by Laws or
Regulations, whichever is greater;
3. Include completed operations insurance;
4. Include contractual liability insurance covering DESIGN/BUILDER's
indemnity obligations under paragraphs 6.06, 6.10 and 6.19;
5. Contain a provision or endorsement that the coverage afforded will not
be cancelled, materially changed or renewal refused until at least thirty
(30) days prior written notice has been given to OWNER and each other
additional insured to whom a certificate of insurance has been issued (and
the certificates of insurance furnished by the DESIGN/BUILDER pursuant to
paragraph 5.08.B will so provide);
6. Remain in effect at least until final payment and at all times
thereafter when DESIGN/BUILDER may be correcting, removing or replacing
defective Construction in accordance with paragraphs 12.06 and 12.07;
7. With respect to completed operations insurance, remain in effect for at
least one year after final payment (and DESIGN/BUILDER shall furnish
OWNER and each other additional insured to whom a certificate of insurance
has been issued evidence satisfactory to OWNER and any such additional
insured of continuation of such insurance at final payment); and
8. DESIGN/BUILDER shall maintain in effect all insurance coverage required
under this paragraph at the DESIGN/BUILDER'S sole expense with insurance
companies (and policies) approved by OWNER and lawfully authorized to do
business in the jurisdiction in which the Project is located. If the
DESIGN/BUILDER fails to obtain or maintain any insurance coverage required
under this Agreement, the OWNER may purchase such coverage and charge the
expense to the DESIGN/BUILDER, or terminate this Agreement for cause in
accordance with paragraph 14.02 below.
5.03 OWNER 's Liability Insurance
A. In addition to the insurance required to be provided by DESIGN/BUILDER
under paragraph 5.02, OWNER, at OWNER'S option, may purchase and maintain at
OWNER'S expense OWNER'S own liability insurance as will protect OWNER against
claims which may arise from operations under the Contract Documents.
10
5.04 Property Insurance
A. OWNER shall purchase and maintain property insurance upon the
Construction at the Site in the amount of the full replacement cost thereof at
the OWNER'S sole expense with insurance companies (and policies) approved by
DESIGN/BUILDER and lawfully authorized to do business in the jurisdiction in
which the Project is located (subject to such deductible amounts as may be
agreed to by OWNER and DESIGN/BUILDER or as may be required by Laws and
Regulations). This insurance will:
1. Include the interests of OWNER, DESIGN/BUILDER, Subcontractors, and any
other persons or entities listed as an insured or additional insured;
2. Be written on a Builder's Risk "all-risk" or equivalent policy form that
shall at least include insurance for physical loss and damage to the
Construction, temporary buildings, falsework and all materials and
equipment in transit, and shall insure against at least the following
perils or causes of loss: fire, lightning, extended coverage, theft,
vandalism and malicious mischief, earthquake, collapse, debris removal,
demolition occasioned by enforcement of Laws and Regulations, water damage,
flood, system testing, and such other perils or causes of loss as may be
agreed in writing by DESIGN/BUILDER and OWNER;
3. Include expenses incurred in the repair or replacement of any insured
property (including but not limited to fees and charges of engineers and
architects);
4. Cover materials and equipment stored at the Site or at another location
that was agreed to in writing by OWNER prior to being incorporated in the
Construction, provided that such materials and equipment have been included
in an Application for Payment approved by OWNER; and
5. Be maintained in effect until final payment is made unless otherwise
agreed to in writing by OWNER and DESIGN/BUILDER with thirty (30) days
written notice to each other additional insured to whom a certificate of
insurance has been issued.
B. OWNER shall purchase and maintain such boiler and machinery insurance or
additional property insurance as DESIGN/BUILDER may reasonably require or
required by Laws and Regulations which will include the interests of OWNER,
DESIGN/BUILDER, Subcontractors, and other individuals and entities listed as an
insured or additional insured.
C. All the policies of insurance (and the certificates or other evidence
thereof) required to be purchased and maintained by OWNER in accordance with
paragraph 5.04 will contain a provision or endorsement that the coverage
afforded will not be cancelled or materially changed or renewal refused until at
least thirty (30) days prior written notice has been given to DESIGN/BUILDER and
to each other additional insured to whom a certificate of insurance has been
issued.
D. OWNER shall not be responsible for purchasing and maintaining any
property insurance to protect the interests of DESIGN/BUILDER, Subcontractors,
Suppliers, Engineers or others in the Work to the extent of any deductible
amounts agreed to by OWNER and DESIGN/BUILDER. The risk of loss within such
identified deductible amounts will be borne by DESIGN/BUILDER, Subcontractor or
others suffering any such loss and if any of them wishes property insurance
coverage within the limits of such deductible amount, each may purchase and
maintain it at the purchaser's own expense.
11
E. If DESIGN/BUILDER requests in writing that other special insurance be
included in the property insurance policies provided under paragraph 5.04,
OWNER shall, if possible, include such insurance, and the cost thereof will be
charged to DESIGN/BUILDER by appropriate Change Order or Written Amendment.
Prior to commencement of the Work at the Site, OWNER shall in writing advise
DESIGN/BUILDER whether or not such other insurance has been procured by OWNER.
5.05 Waiver of Subrogation Rights
A. OWNER and DESIGN/BUILDER intend that all policies purchased in
accordance with paragraph 5.04 will protect OWNER, DESIGN/BUILDER, Engineers,
Subcontractors, others who may have a financial interest in the Project, and all
other individuals or entities listed as insureds or additional insureds in such
policies and will provide primary coverage for all losses and damages caused by
the perils or causes of loss covered thereby. All such policies shall contain
provisions to the effect that in the event of payment of any loss or damage the
insurers will have no rights of recovery against any of the insureds or
additional insureds thereunder. Each party waives all rights against the other
party and its officers, directors, employees, members, and agents for all losses
and damages caused by, arising out of or resulting from any of the perils or
causes of loss covered by such policies and any other property insurance
applicable to the Work.
5.06 Receipt and Application of Proceeds
A. Any insured loss under the policies of insurance required by paragraph
5.04 will be adjusted with OWNER and made payable to OWNER as fiduciary for the
benefit of insureds, as their interests may appear, subject to the requirements
of any applicable mortgage clause and of paragraph 5.06.B. OWNER shall deposit
in a separate account any money so received, and shall distribute it in
accordance with such agreement as the parties in interest may reach. If no other
special agreement is reached the damaged Work shall be repaired or replaced, the
moneys so received applied on account thereof and the Work and the cost thereof
covered by an appropriate Change Order or Written Amendment.
B. OWNER as fiduciary shall have power to adjust and settle any loss with
the insurers unless one of the parties in interest shall object in writing
within fifteen (15) days after the occurrence of loss to OWNER'S exercise of
this power. If such objection be made, OWNER as fiduciary shall make settlement
with the insurers in accordance with such agreement as the parties in interest
may reach. If no such agreement among the parties in interest is reached, OWNER
as fiduciary shall adjust and settle the loss with the insurers and, if required
in writing by any party in interest, OWNER as fiduciary shall give bond for the
proper performance of such duties..
5.07 Acceptance of Insurance; Option to Replace
A. If either party has any objection to the coverage afforded by or other
provisions of the insurance required to be purchased and maintained by the other
party in accordance with Article 5 on the basis of their not complying with the
Contract Documents, the objecting party shall so notify the other party in
writing within thirty (30) days after receipt of the certificates (or other
evidence requested) required by paragraph 2.03.B. OWNER and DESIGN/BUILDER shall
each provide to the other such additional information in respect of insurance
provided as the other may reasonably request. If either party does not purchase
or maintain all of the insurance required of such party by the Contract
Documents, such party shall notify the other party in writing of such failure to
purchase prior to the start of the Work, or of such failure to maintain prior to
any change in the required coverage. Without prejudice to any other right or
12
remedy, the other party may elect to obtain equivalent insurance to protect such
other party's interests at expense of the party who was supposed to provide such
coverage, and a Change Order or Written amendment shall be issued to adjust the
Contract Price accordingly.
5.08 Licensed Sureties and Insurers; Certificates of Insurance
A. All insurance required by the Contract Documents to be purchased and
maintained by OWNER or DESIGN/BUILDER shall be obtained from insurance companies
that are duly licensed or authorized in the jurisdiction in which the Project is
located to issue insurance policies for the limits and coverages so required.
Such insurance companies shall also meet such additional requirements and
qualifications as may be agreed in writing by DESIGN/BUILDER and OWNER.
B. DESIGN/BUILDER shall deliver to OWNER, with copies to each additional
insured, certificates of insurance (and other evidence of insurance requested by
OWNER or any other additional insured) which DESIGN/BUILDER is required to
purchase and maintain in accordance with paragraph 5.02.A. OWNER shall deliver
to DESIGN/BUILDER, with copies to each additional insured, certificates of
insurance (and other evidence of insurance requested by DESIGN/BUILDER or any
other additional insured) which OWNER is required to purchase and maintain in
accordance with paragraphs 5.04.A and 5.04 B.
ARTICLE 6--DESIGN/BUILDER'S RESPONSIBILITIES
6.01 Design Professional Services
A. Standard of Care: DESIGN/BUILDER shall perform or furnish Design
Professional Services and related services in all phases of the Project. The
standard of care for all such services performed or furnished under this
Agreement will be the care and skill ordinarily used by members of the
engineering profession practicing under similar conditions at the same time and
locality.
B. Preliminary Design Phase: During the preliminary design phase,
DESIGN/BUILDER shall:
1. Consult with OWNER to understand OWNER'S requirements for the Project
and review available data.
2. Advise OWNER as to the necessity of OWNER providing or obtaining from
others additional reports, data or services of the types provided in
paragraph 8.01.A.6.a-g and assist OWNER in obtaining such reports, data, or
services.
3. Obtain such additional geotechnical and related information which it
deems necessary for performance of the Work.
C. [not used]
D. Construction Phase. During Construction, DESIGN/BUILDER shall provide
Engineering and Design Professional Services as necessary to complete the
Project.
E. not used
13
6.02 Supervision of Construction
A. DESIGN/BUILDER shall supervise, inspect and direct the Construction
competently and efficiently, devoting such attention thereto and applying such
skills and expertise as may be necessary to provide the Construction in
accordance with the Contract Documents. DESIGN/BUILDER shall be solely
responsible for the means, methods, techniques, sequences and procedures
employed for the provision of Construction. DESIGN/BUILDER shall be responsible
to see that the completed Construction complies accurately with the Contract
Documents and shall keep OWNER advised as to the quality and progress of the
Construction.
6.03 Labor, Materials and Equipment
A. DESIGN/BUILDER shall provide competent, suitably qualified personnel to
survey and lay out the Construction and perform Construction as required by the
Contract Documents. DESIGN/BUILDER shall at all times maintain good discipline
and order at the Site.
B. Unless otherwise specified in the Contract Documents, DESIGN/BUILDER
shall furnish or cause to be furnished and assume full responsibility for
materials, equipment, labor, transportation, construction equipment and
machinery, tools, appliances, fuel, light, heat, telephone, water, sanitary
facilities, temporary facilities and all other facilities and incidentals
necessary for the furnishing, and completion of the Work associated with the
base scope of work.
C. All materials and equipment incorporated into the Work shall be of good
quality and new. All warranties and guarantees specifically called for by the
Contract Documents shall expressly run to the benefit of OWNER. If reasonably
required by OWNER, DESIGN/BUILDER shall furnish satisfactory evidence (including
reports of required tests) as to the kind and quality of materials and
equipment. All materials and equipment shall be applied, installed, connected,
erected, used, cleaned and conditioned in accordance with instructions of the
applicable Supplier.
6.04 Progress Schedule
A. DESIGN/BUILDER shall adhere to the progress schedule established in
accordance with paragraph 2.05.A as it may be adjusted from time to time.
1. DESIGN/BUILDER shall submit to OWNER for acceptance proposed adjustments
in the progress schedule that will not change the Contract Times. Such
adjustments will conform generally to the progress schedule then in effect.
2. Proposed adjustments in the progress schedule that will change the
Contract Times shall be submitted in accordance with the requirements of
Article 11. Such adjustments may only be made by a Change Order or Written
Amendment.
6.05 Concerning Subcontractors, Suppliers and Others
14
A. DESIGN/BUILDER shall not employ any Subcontractor, Engineer, Supplier or
other individual or entity against whom OWNER may have reasonable objection.
DESIGN/BUILDER shall not be required to employ any Subcontractor, Engineer,
Supplier or other individual or entity to furnish or perform any of the Work
against whom DESIGN/BUILDER has reasonable objection.
B. DESIGN/BUILDER shall be fully responsible to OWNER for all acts and
omissions of the Subcontractors, Engineers, Suppliers and other individuals or
entities performing or furnishing any of the Work under a direct or indirect
contract with DESIGN/BUILDER. Nothing in the Contract Documents shall create for
the benefit of any such Subcontractor, Engineer, Supplier or other individual or
entity any contractual relationship between OWNER and any such Subcontractor,
Engineer, Supplier or other individual or entity, nor shall it create any
obligation on the part of OWNER to pay or to see to the payment of any moneys
due any such Subcontractor, Engineer, Supplier or other individual or entity
except as may otherwise be required by Laws and Regulations.
C. DESIGN/BUILDER shall be solely responsible for scheduling and
coordinating Subcontractors, Engineers, Suppliers and other individuals and
entities performing or furnishing any of the Work under a direct or indirect
contract with DESIGN/BUILDER. DESIGN/BUILDER shall require all Subcontractors,
Engineers, Suppliers and such other individuals and entities performing or
furnishing any of the Work to communicate with the OWNER through DESIGN/BUILDER.
D. All services performed or provided to and material and equipment
supplied to DESIGN/BUILDER by a Subcontractor or Supplier will be pursuant to an
appropriate Design Subagreement or Construction Subagreement between
DESIGN/BUILDER and the Subcontractor, Engineer or Supplier which specifically
binds the Subcontractor, Engineer or Supplier to the applicable terms and
conditions of the Contract Documents for the benefit of OWNER. Whenever any such
agreement is with a Subcontractor, Engineer or Supplier who is listed as an
additional insured on the property insurance provided in \paragraph 5.04.A or
5.04.B, the agreement between the DESIGN/BUILDER and the Subcontractor,
Engineer or Supplier will contain provisions whereby the Subcontractor,
Engineer or Supplier waives all rights against OWNER, DESIGN/BUILDER, and all
other additional insureds for all losses and damages caused by any of the perils
or causes of loss covered by such policies and any other property insurance
applicable to the Work. If the insurers on any such policies require separate
waiver forms to be signed by any Subcontractor, Engineer or Supplier,
DESIGN/BUILDER will obtain the same.
6.06 Patent Fees and Royalties
A. DESIGN/BUILDER shall pay all license fees and royalties and assume all
costs incident to the use in the performance of the Work or the incorporation in
the Work of any invention, design, process, product or device (other than any
increased license fees, royalties and costs arising out of or resulting from a
Change Order) which is the subject of patent rights or copyrights held by
others. To the fullest extent permitted by Laws and Regulations, DESIGN/BUILDER
shall indemnify and hold harmless OWNER, from and against all claims, costs,
losses and damages (including but not limited to all reasonable fees and charges
of engineers, architects, attorneys and other professionals and all court or
arbitration or other dispute resolution costs) arising out of or resulting from
any infringement of patent rights or copyrights incident to the use in the
performance of the Work or resulting from the incorporation in the Work of any
invention, design, process, product or device.
15
6.07 Permits and Utilities
A. Unless otherwise provided in the Contract Documents, OWNER shall obtain
and pay for all necessary permits and licenses. DESIGN/BUILDER shall assist
OWNER, when necessary, in obtaining such permits and licenses. OWNER shall pay
all governmental charges and inspection fees necessary for the prosecution of
the Construction, which are applicable on the Effective Date of the Agreement.
OWNER shall pay all charges of utility owners for connections to the Work, OWNER
shall pay all charges of such utility owners for capital costs related thereto
and OWNER shall pay for all charges for use or consumption of such utilities
relating to the performance of the Work.
6.08 Laws and Regulations
A. DESIGN/BUILDER shall give all notices and comply with all Laws and
Regulations of the place of the Project which are applicable to furnishing and
performance of the Work. OWNER shall not be responsible for monitoring
DESIGN/BUILDER's compliance with any Laws or Regulations.
B. If DESIGN/BUILDER performs any Work knowing or having reason to know
that it is contrary to Laws or Regulations, DESIGN/BUILDER shall bear all costs
arising therefrom.
C. Changes in Laws and Regulations not known on the Effective Date of the
Agreement having an effect on the cost or time of performance may be the subject
of a claim under Article 9.
6.09 Taxes
A. OWNER shall pay to DESIGN/BUILDER all sales, consumer, use, gross
receipts and other similar taxes which are applicable during the performance of
the Work and are either paid by DESIGN/BUILDER or are required to be reimbursed
by DESIGN/BUILDER to its Subcontractors, Suppliers, or Engineers.
16
6.10 Use of Site and Other Areas
A. DESIGN/BUILDER shall confine construction equipment, the storage of
materials and equipment and the operations of construction workers to those
lands and areas permitted by the OWNER and other land and areas permitted by
Laws and Regulations, rights-of-way, permits and easements, and shall not
unreasonably encumber the premises with construction equipment or other
materials or equipment. DESIGN/BUILDER shall be responsible for any damage to
any such land or area, or to the owner or occupant thereof or of any adjacent
land or areas, resulting from the performance of the Construction.
Notwithstanding the foregoing sentence, DESIGN/BUILDER shall not be responsible
for, or any damage relating to, restoration of the landscaping or seeding of any
such land or area and DESIGN/BUILDER shall only be responsible for restoring
such land or area to the condition of such land or area at the time
DESIGN/BUILDER completed the original construction of the plant. Should any
claim be made by any such owner or occupant because of the performance of the
Construction, DESIGN/BUILDER shall promptly settle with such other party by
negotiation or otherwise resolve the claim by arbitration or other dispute
resolution proceeding or at law. DESIGN/BUILDER shall, to the fullest extent
permitted by Laws and Regulations, indemnify and hold harmless OWNER and anyone
directly or indirectly employed by OWNER from and against all claims, costs,
losses and damages (including, but not limited to, all reasonable fees of
engineers, architects, attorneys and other professionals and court and
arbitration or other dispute resolution costs) arising out of or resulting from
any claim or action, legal or equitable, brought by any such owner or occupant
against OWNER, or any other party indemnified hereunder to the extent caused by
or based upon DESIGN/BUILDER's performance of the Construction.
B. During the performance of the Construction, DESIGN/BUILDER shall keep
the premises free from accumulations of waste materials, rubbish and other
debris resulting from the Construction. At the completion of the Construction,
DESIGN/BUILDER shall remove all waste materials, rubbish and debris from and
about the premises as well as all tools, appliances, construction equipment,
temporary construction and machinery and surplus materials. DESIGN/BUILDER
shall leave the Site clean and ready for occupancy by OWNER at Substantial
Completion. DESIGN/BUILDER shall restore to original condition all property not
designated for alteration by the Contract Documents.
C. DESIGN/BUILDER shall not load nor permit any part of any structure to be
loaded in any manner that will endanger the structure, nor shall DESIGN/ BUILDER
subject any part of the Work or adjacent property to stresses or pressures that
will endanger it.
6.11 Record Documents
A. DESIGN/BUILDER shall maintain at its office one record copy of all
Drawings, Specifications, Written Amendments, and Change Orders, in good order
and annotated to show all changes made during Construction. These record
documents will be available to OWNER for reference. Upon completion of the Work,
these record documents,including a reproducible set of record drawings, will be
delivered to OWNER.
17
6.12 Safety and Protection
A. DESIGN/BUILDER shall be responsible for initiating, maintaining and
supervising all safety precautions and programs in connection with the
Construction. DESIGN/BUILDER shall take all necessary precautions for the safety
of, and shall provide the necessary protection to prevent damage, injury or loss
to:
1. All persons on the Site or who may be affected by the Construction;
2. All Work and materials and equipment to be incorporated therein, whether
in storage on or off the Site; and
3. Other property at the Site or adjacent thereto, including trees, shrubs,
lawns, walks, pavements, roadways, structures, utilities and underground
facilities not designated for removal, relocation or replacement in the
course of construction.
Notwithstanding the foregoing, DESIGN/BUILDER shall not be responsible for
initiating, maintaining or supervising any safety precautions or programs
relating to the operation of the plant or any person on the Site who is not an
employee of DESIGN/BUILDER or one of its Subcontractors or Suppliers.
B. DESIGN/BUILDER shall comply with applicable Laws and Regulations of any
public body having jurisdiction for safety of persons or property or to protect
them from damage, injury or loss; and shall erect and maintain all necessary
safeguards for such safety and protection. DESIGN/BUILDER shall notify owners of
adjacent property and of underground facilities and utility owners when
prosecution of the Work may affect them, and shall cooperate with them in the
protection, removal, relocation and replacement of their property. All damage,
injury or loss to any property caused, directly or indirectly, in whole or in
part, by DESIGN/BUILDER, any Subcontractor, Supplier or any other individual or
entity directly or indirectly employed by any of them to perform or furnish any
of the Work or anyone for whose acts any of them may be liable, shall be
remedied by DESIGN/BUILDER. DESIGN/BUILDER's duties and responsibilities for
safety and for protection of the construction shall continue until (i) such time
as all the Work is completed and OWNER has issued a notice to DESIGN/BUILDER in
accordance with paragraph 13.09 that the Work is acceptable or, (ii) in the
event DESIGN/BUILDER is excluded from the Site under paragraph 13.05.B. after
Substantial Completion, the date DESIGN/BUILDER is excluded from the Site.
6.13 [not used]
6.14 Hazard Communication Programs
A. DESIGN/BUILDER shall be responsible for coordinating any exchange of
material safety data sheets or other hazard communication information required
to be made available to or exchanged between or among employers at the Site in
accordance with Laws or Regulations.
18
6.15 Emergencies
A. In emergencies affecting the safety or protection of persons or the
construction or property at the Site or adjacent thereto, DESIGN/BUILDER,
without special instruction or authorization from OWNER, is obligated to act to
prevent threatened damage, injury or loss. DESIGN/BUILDER shall give OWNER
prompt written notice if DESIGN/BUILDER believes that any significant changes in
the Construction or variations from the Contract Documents have been caused
thereby. If a change in the Contract Documents is required because of the action
taken by DESIGN/BUILDER in response to such an emergency, a Change Order will be
issued to document the consequences of such action.
6.16 [not used]
6.17 Continuing the Work
A. DESIGN/BUILDER shall carry on the Work and adhere to the progress
schedule during all disputes or disagreements with OWNER. No Work shall be
delayed or postponed pending resolution of any disputes or disagreements,
except as DESIGN/BUILDER and OWNER may otherwise agree in writing or as
otherwise provided in the Contract Documents.
6.18 DESIGN/BUILDER's General Warranty and Guarantee
A. DESIGN/BUILDER warrants and guarantees to OWNER that all Construction
will be in accordance with the Contract Documents and will not be defective.
DESIGN/BUILDER's warranty and guarantee hereunder excludes defects or damage
caused by:
1. Abuse, modification or improper maintenance or operation by persons
other than DESIGN/BUILDER, Subcontractors or Suppliers; or
2. Normal wear and tear under normal usage.
B. DESIGN/BUILDER's obligation to perform and complete the Work in
accordance with the Contract Documents shall be absolute. Except as provided in
paragraph 12.08, no action by OWNER will constitute an acceptance of Work that
is not in accordance with the Contract Documents or a release of
DESIGN/BUILDER's obligation to perform the Work in accordance with the Contract
Documents, including but not limited to the following:
1. Observations by OWNER;
2. The making of any progress or final payment;
3. The issuance of a certificate of Substantial Completion;
4. Use or occupancy of the Work or any part thereof by OWNER;
5. Any acceptance by OWNER or any failure to do so;
6. Any review and approval of a Submittal;
19
7. Any inspection, test or approval by others; or
8. Any correction of defective Construction by OWNER.
C. DESIGN/BUILDER shall, at final completion, assign to OWNER all
manufacturer's warranties for materials and equipment incorporated into the
Project; provided, however, in the event of a claim by OWNER against
DESIGN/BUILDER, OWNER shall use its best efforts to cooperate with
DESIGN/BUILDER in the enforcement of any applicable warranty.
6.19 Indemnification
OWNER and DESIGN/BUILDER are and will be throughout the term of the
Agreement independent contractors as to each other. Each party recognizes that
it shall be solely responsible for its own conduct, including without limitation
its own fault, as to any aspect of the Agreement. In the event any claim is made
or any action is filed by a third party arising out of this Agreement or the
services to be performed under it, the parties anticipate that each will defend
said claim or action on its own behalf, and will pay, settle, or otherwise
dispose of any demand or judgment against it consistent with the provisions of
the Kansas comparative negligence statute, K.S.A. section 60-258a, in effect on
the date of this Agreement. In the event either party is made to respond in
damages for the fault of the other party, then the other party agrees to
indemnify and hold harmless the first party (including its officers, directors,
employees, and agents) from any payment that it has to make, including without
limitation the payment of reasonable attorneys' fees incurred in resisting,
settling, or otherwise disposing of the demand, on account of the other party's
fault. In regard to the indemnity obligation in this paragraph 6.19 or any other
provision of the General Conditions, neither party shall make a payment for
which indemnity will be sought from the other party without first providing such
other party written notice of the claim and an opportunity to assume the
defense.
ARTICLE 7-OTHER CONSTRUCTION
7.01 Related Construction at Site
A. OWNER may perform other Work related to the Project at the Site by
OWNER'S own forces, or let other direct contracts therefor or have other work
performed by utility owners. Written notice thereof will be given to
DESIGN/BUILDER prior to starting any such other work.
B. DESIGN/BUILDER shall afford each other contractor who is a party to such
a direct contract and each utility owner (and OWNER, if OWNER is performing the
additional work with OWNER'S employees) proper and safe access to the Site and a
reasonable opportunity for the introduction and storage of materials and
equipment and the execution of such other work and shall properly connect and
coordinate the Construction with theirs. DESIGN/BUILDER shall do all cutting,
fitting and patching of the Work that may be required to make its several parts
come together properly and integrate with such other work. DESIGN/BUILDER shall
not endanger any work of others by cutting, excavating or otherwise altering
their work and will only cut or alter their work with the written consent of
OWNER and the others whose work will be affected.
C. If the proper execution or results of any part of DESIGN/BUILDER's Work
depends upon work performed or services provided by others under this Article 7,
DESIGN/BUILDER shall inspect such other work and appropriate instruments of
service and promptly report to OWNER in writing any delays,
20
defects or deficiencies in such other work or services that render it
unavailable or unsuitable for the proper execution and results of DESIGN/
BUILDER's Work. DESIGN/BUILDER's failure so to report will constitute an
acceptance of such other work as fit and proper for integration with
DESIGN/BUILDER's Work except for latent or nonapparent defects and deficiencies
in such other work.
ARTICLE 8-OWNER'S RESPONSIBILITIES
8.01 General
A. OWNER shall do the following in a timely manner so as not to delay
the services of DESIGN/BUILDER.
1. Xxxx Xxxxxx to act as OWNER'S representative with respect to the
services to be rendered under this Agreement.
2. Provide such legal services as OWNER may require with regard to land use
and governmental permitting issues pertaining to the Project including any
such land use or governmental permitting issues that may be raised by
DESIGN/BUILDER.
3. If requested in writing by DESIGN/BUILDER, furnish reasonable evidence
satisfactory to DESIGN/BUILDER, that sufficient funds are available and
committed for the entire cost of the Project. Unless such reasonable
evidence is furnished, DESIGN/BUILDER is not required to commence or
continue any Work, or may, if such evidence is not presented within a
reasonable time, stop Work upon fifteen (15) days' notice to the Owner.
4. Make payments to DESIGN/BUILDER promptly when they are due as provided
in Article 13.
5. Furnish lands and easements as set forth in paragraph 4.01.A.
6. Furnish to DESIGN/BUILDER, as required for performance of
DESIGN/BUILDER's services the following, all of which DESIGN/BUILDER may
use and rely upon in performing services under this Agreement:
a. Environmental assessment and impact statements;
b. Property, boundary, easement, right-of-way, topographic and
utility surveys;
c. Property descriptions;
d. Zoning, deed and other land use restrictions;
e. Engineering surveys to establish reference points for design and
construction which in OWNER'S judgment are necessary to enable
DESIGN/BUILDER to proceed with the Work;
f. Assistance in filing documents required to obtain necessary
approvals of governmental authorities having jurisdiction over
the Project; and
g. Subsurface data.
21
7. [not used].
8. Provide information known to or in the possession of OWNER relating to
the presence of materials and substances at the site which could create a
Hazardous Condition.
9. Perform all items designated as OWNER'S responsibilities in the
Agreement and Exhibit B.
8.02 Scope of OWNER'S Safety and Hazardous Waste Responsibilities
A. OWNER shall not supervise, direct or have control or authority over, nor
be responsible for, DESIGN/BUILDER's means, methods, techniques, sequences or
procedures of Construction or the safety precautions and programs incident
thereto, or for any failure of DESIGN/BUILDER to comply with Laws and
Regulations applicable to the furnishing or performance of the Work. OWNER will
not be responsible for DESIGN/BUILDER's failure to perform or furnish the Work
in accordance with the Contract Documents.
ARTICLE 9--CHANGES IN THE WORK; CLAIMS
9.01 General--Rights and Obligations
A. Without invalidating the Agreement, OWNER may, at any time or from time
to time, request additions, deletions or revisions in the Work within the
general scope of the contract by a Written Amendment or a Change Order. If
DESIGN/BUILDER agrees to such Written Amendment or Change Order, which agreement
shall not be unreasonably withheld, DESIGN/BUILDER shall promptly proceed with
the Work involved which will be performed under the applicable provisions of the
Contract Documents (except as otherwise specifically provided).
9.02 Notice of Intent to Make Claim
A. If OWNER and DESIGN/BUILDER are unable to agree as to the extent, if
any, of an adjustment in the Contract Price or an adjustment of the Contract
Times that should be allowed as a result of any order of OWNER pursuant to
paragraph 9.01.A or other occurrence for which the Contract Documents provide
that such adjustment(s) may be made, a claim may be made therefor. Written
notice of intent to make such a claim shall be submitted to the other party
promptly and in no event more than thirty (30) days after the start of the
occurrence or event giving rise to the claim.
9.03 Claim Documentation
A. Substantiating documentation shall be submitted by the claiming party
within thirty (30) days after delivery of the notice required by paragraph
9.02.A.
9.04 Decision
A. The other party shall render a decision on the claim no more than thirty
(30) days after the receipt of the substantiating documentation required by
paragraph 9.03.A. This decision will be final and binding unless the claiming
party gives notice of intention to exercise its rights under Article 15 within
thirty (30) days of receipt of the decision and exercises such rights within
thirty (30) days of giving the notice of intent.
22
9.05 Time Limit Extension
A. The time limits of paragraphs 9.03.A and 9.04.A may be extended by
mutual agreement.
9.06 Exceptions
A. DESIGN/BUILDER shall not be entitled to an increase in the Contract
Price with respect to any Work performed that is not contemplated by the
Contract Documents as amended, modified and supplemented as provided in
paragraph 3.03.
9.07 Execution of Change Orders
A. OWNER and DESIGN/BUILDER shall execute appropriate Change Orders or
Written Amendments covering:
1. changes in the Work which are (i) ordered by OWNER pursuant to paragraph
9.01, (ii) required because of acceptance of defective Construction under
paragraph 12.08 or correcting defective Work under paragraph 12.09 or (iii)
agreed to by the parties; and
2. changes in the Contract Price or Contract Times which are agreed to by
the parties.
ARTICLE 10--CHANGE OF CONTRACT PRICE
10.01 General
A. The Contract Price constitutes the total compensation (subject to
authorized adjustments) payable to DESIGN/BUILDER for performing the Work.
B. The Contract Price may only be changed by a Change Order or by a Written
Amendment. Any claim for an adjustment in the Contract Price shall be based on
written notice delivered by the party making the claim to the other party
promptly in accordance with paragraph 9.02.A.
C. The value of any Work covered by a Change Order or of any claim for an
increase or decrease in the Contract Price will be determined as follows:
1. By a mutually agreed lump sum (which may include an allowance for
overhead and profit not necessarily in accordance with paragraph 10.02); or
2. Where agreement to a lump sum is not reached under paragraph 10.01.C.I,
on the basis of the Cost of the Work (determined as provided in paragraph
10.02) plus a DESIGN/BUILDER's Fee for overhead and profit (determined as
provided in paragraph 10.02.C).
23
10.02 Cost of the Work
A. Costs Included: The term Cost of the Work means the sum of all costs
necessarily incurred and paid by DESIGN/BUILDER in the proper performance of
work authorized only by a Change Order or Written Amendment (together "Change
Order Work"). Except as otherwise may be agreed to in writing by OWNER, such
costs shall be in amounts no higher than those prevailing in the locality of the
Project, shall include only the following items and shall not include any of the
costs itemized in paragraph 10.02.B:
1. Payroll costs for employees in the direct employ of DESIGN/BUILDER in
the performance of the Change Order Work under the then current schedule of
job classifications and hourly rates of DESIGN/BUILDER.
2. Cost of all materials and equipment furnished and incorporated in the
Change Order Work, including costs of transportation and storage thereof,
and Suppliers' field services required in connection therewith.
3. Payments made by DESIGN/BUILDER to Subcontractors for Change Order Work
performed or furnished by Subcontractors.
4. Payments made by DESIGN/BUILDER to Engineers (not employees of
DESIGN/BUILDER or its affiliates) for Design Professional Services provided
or furnished by Engineers under a Design Subagreement for Change Order
Work.
5. Costs of special consultants (including but not limited to testing
laboratories and surveyors, but excluding employees of DESIGN/BUILDER or
its affiliates) employed for services specifically related to Change Order
Work.
6. Supplemental costs including the following items:
a. The proportion of necessary transportation, travel and subsistence
expenses of DESIGN/BUILDER's employees incurred in discharge of
duties connected with Change Order Work.
b. Cost, including transportation and maintenance, of all materials,
supplies, equipment, machinery, appliances, office and temporary
facilities at the Site and hand tools not owned by the workers, which
are consumed in the performance of Change Order Work, and cost less
market value of such items used but not consumed which remain the
property of DESIGN/BUILDER.
c. Rentals of all Work equipment and machinery and the parts thereof
whether rented from DESIGN/BUILDER or others in accordance with rental
agreements approved by OWNER, and the costs of transportation,
loading, unloading, installation, dismantling and removal thereof--all
in accordance with the terms of said rental agreements. The rental of
any such equipment, machinery or parts shall cease when the use
thereof is no longer necessary for Change Order Work.
d. Sales, consumer, use or similar taxes related to Change Order Work,
paid by DESIGN/BUILDER or required to be reimbursed by DESIGN/BUILDER
to its Subcontractors, Suppliers, or Engineers.
B. Costs Excluded: The term Cost of the Work shall not include any of the
following:
24
1. Payroll costs and other compensation of DESIGN/BUILDER's officers,
executives, principals (of partnerships and sole proprietorships),
general managers, architects, attorneys, auditors, accountants,
purchasing and contracting agents, expediters, timekeepers, clerks and
other personnel employed by DESIGN/BUILDER whether at the Site or in
DESIGN/BUILDER's principal or a branch office for general
administration of the Work and not specifically included in the agreed
upon schedule of job classifications referred to in paragraph
10.02.A.1 -- all of which are to be considered administrative costs
covered by the DESIGN/BUILDER's fee.
2. Expenses of DESIGN/BUILDER's principal and branch offices other
than DESIGN/BUILDER's office at the Site.
3. Any part of DESIGN/BUILDER's capital expenses, including interest
on DESIGN/BUILDER's capital employed for the Work and charges against
DESIGN/BUILDER for delinquent payments.
4. Costs due to the negligence of DESIGN/BUILDER, any Subcontractor,
or anyone directly or indirectly employed by any of them or for whose
acts any of them may be liable, including but not limited to, the
correction of defective Work, disposal of materials or equipment
wrongly supplied and making good any damage to property.
5. Other overhead or general expense costs of any kind and the costs
of any item not specifically and expressly included in paragraph
10.02.A.
C. Fee:
1. A mutually agreed fee or, in the event the parties can not
agree upon a fee, DESIGN/BUILDER's fee for overhead and profit on
Change Orders priced by paragraph 10.01.C.2 (whether additive or
deductive) shall be ten percent (10) of the Cost of the Change
Order Work for subcontracts, materials and equipment.
2. When both additions and credits are involved in any one
change, the adjustment in DESIGN/BUILDER's fee shall be computed
on the basis of the net change in accordance with paragraph
10.02.C.1 above.
D. Documentation: Whenever the cost of any Work is to be determined
pursuant to paragraphs 10.02.A and 10.02.B, DESIGN/BUILDER will establish
and maintain records thereof in accordance with generally accepted
accounting practices and submit in a form acceptable to OWNER an itemized
cost breakdown together with supporting data.
ARTICLE 11-CHANGE OF CONTRACT
TIMES 11.01 General
A. The Contract Times may only be changed by a Change Order or a Written
Amendment. Any claim for an adjustment of the Contract Times shall be based on
written notice pursuant to paragraph 9.02.
B. All Contract Times are of the essence of the Agreement.
25
11.02 Time Extensions
A. Where DESIGN/BUILDER is prevented from completing any part of the Work
within the Contract Times due to delay beyond the control of DESIGN/BUILDER, the
Contract Times will be extended in an amount equal to the time lost due to such
delay if a claim is made therefor as provided in Article 9. Delays beyond the
control of DESIGN/BUILDER shall include, but not be limited to, acts or neglect
by OWNER, governmental agencies, acts or neglect of utility owners or other
contractors performing other construction work as contemplated by Article 7,
fires, floods, epidemics, abnormal weather conditions or acts of God. Delays
attributable to and within the control of a Subcontractor or Supplier shall be
deemed to be delays within the control of DESIGN/BUILDER.
B. Nothing in this paragraph 11.02 bars a change in Contract Price pursuant
to Article 10 to compensate for the direct costs incurred by DESIGN/BUILDER due
to delay, interference, or disruption directly attributable to actions or
inactions of OWNER. However, OWNER shall not be liable to DESIGN/BUILDER for
costs or damages arising out of or resulting from (i) delays caused by or within
the control of DESIGN/BUILDER, or (ii) delays beyond the control of both parties
including but not limited to fires, floods, epidemics, abnormal weather
conditions, acts of God or acts or neglect by governmental agencies, utility
owners, or other contractors performing other work as contemplated by Article 7.
ARTICLE 12--TESTS AND INSPECTIONS; CORRECTION, REMOVAL OR ACCEPTANCE OF
DEFECTIVE CONSTRUCTION
12.01 Notice of Defects
A. Each party shall give the other prompt written notice of all defective
Construction of which such party has actual knowledge. All defective
Construction may be rejected, corrected or accepted as provided in this Article
12.
12.02 not used
12.03 Tests and Inspections
A. If the Contract Documents or Laws or Regulations of any public body
having jurisdiction require any part of the Construction specifically to be
inspected, tested or approved, DESIGN/BUILDER shall assume full responsibility
for arranging and obtaining such inspections, tests or approvals, pay all costs
in connection therewith, and furnish OWNER the required certificates of
inspection or approval. DESIGN/BUILDER shall also be responsible for arranging
and obtaining and shall pay all costs in connection with any inspections, tests
or approvals required for OWNER'S acceptance of materials or equipment to be
incorporated in the Construction or of materials, mix designs, or equipment
submitted for approval prior to DESIGN/BUILDER's purchase thereof for
incorporation in the Construction. Nothing in this paragraph shall be
interpreted or construed as obligating DESIGN/BUILDER to obtain, furnish or pay
the costs of any permit, inspection, test or approval required by the applicable
State or the United States Environmental Protection Agency for the construction
or operation of the Project (including, without limitation, any atmospheric
emissions compliance reports), all of which shall be the responsibility of
OWNER.
26
B. DESIGN/BUILDER shall give OWNER reasonable notice of the planned
schedule for all required inspections, tests or approvals.
C. If any Construction (or the construction work of others) that is
required to be inspected, tested or approved is covered by DESIGN/BUILDER
without written concurrence of OWNER, it must, if requested by OWNER, be
uncovered for observation at DESIGN/BUILDER's expense unless DESIGN/BUILDER has
given OWNER timely notice of DESIGN/BUILDER's intention to cover the same and
OWNER has not acted with reasonable promptness in response to such notice.
12.04 Uncovering Construction
A. If any Construction is covered contrary to the written request of OWNER,
it must, if requested by OWNER, be uncovered for OWNER'S observation and
recovered at DESIGN/BUILDER's expense.
B. If OWNER considers it necessary or advisable that covered Construction
be observed by OWNER or inspected or tested by others, DESIGN/BUILDER, at
OWNER'S request, shall uncover, expose or otherwise make available for
observation, inspection or testing as OWNER may require, that portion of the
Construction in question, furnishing all necessary labor, material and
equipment. If it is found that such Construction is defective, DESIGN/BUILDER
shall pay all costs caused by or resulting from such uncovering, exposure,
observation, inspection and testing (including but not limited to all reasonable
fees and charges of engineers and other professionals) and OWNER shall be
entitled to an appropriate decrease in the Contract Price, and, if the parties
are unable to agree as to the amount thereof, may make a claim therefor as
provided in Article 9. If however, such Construction is not found to be
defective, DESIGN/BUILDER shall be allowed an increase in the Contract Price
directly attributable to such uncovering, exposure, observation, inspection,
testing, replacement and rework; and, if the parties are unable to agree as to
the amount or extent thereof, DESIGN/BUILDER may make a claim therefor as
provided in Article 9.
12.05 OWNER May Stop the Construction
A. If the Construction is defective, or DESIGN/BUILDER fails to supply
sufficient skilled workers or suitable materials or equipment, or fails to
furnish or perform the Construction in such a way that the completed
Construction will conform to the Contract Documents, OWNER may order
DESIGN/BUILDER to stop Construction or any portion thereof, until the cause for
such order has been eliminated; however, this right of OWNER to stop
Construction will not give rise to any duty on the part of OWNER to exercise
this right for the benefit of DESIGN/BUILDER or any other party.
12.06 Correction or Removal of Defective Construction
A. Prior to acceptance and final payment under paragraph 13.09 below, OWNER
will have authority to disapprove or reject defective Construction and will have
authority to require special inspection or testing of the Construction whether
or not the Construction is fabricated, installed or completed. DESIGN/BUILDER
shall promptly, either correct all defective Construction, whether or not
fabricated, installed or completed, or, if the Construction has been rejected by
OWNER, remove it from the Site and replace it with non-defective Construction.
DESIGN/BUILDER shall bear all costs of such correction or removal (including but
not limited to reasonable fees and charges of engineers, architects, attorneys
and other professionals, all court or arbitration or other dispute resolution
costs, and all costs of repair or replacement of work of others) made necessary
thereby. Nothing in this paragraph shall be interpreted or
27
construed as requiring DESIGN/BUILDER to correct or remove and replace defective
Construction accepted by OWNER pursuant to paragraph 12.08 below.
12.07 Correction Period
A. If within one (1) year after the date of Substantial Completion or such
longer period of time as may be prescribed by Laws or Regulations or by the
terms of any applicable special guarantee required by the Contract Documents or
by any specific provision of the Contract Documents, any Construction is found
to be defective, DESIGN/BUILDER shall promptly, without cost to OWNER and in
accordance with OWNER'S written instructions, (i) correct such defective
Construction, or, if it has been rejected by OWNER, remove it from the Site and
replace it with Construction that is not defective, and (ii) satisfactorily
correct or remove and replace any damage to other Construction or the work of
others resulting therefrom. If DESIGN/BUILDER does not promptly comply with the
terms of such instructions, or in an emergency where delay would cause serious
risk of loss or damage, OWNER may have the defective Construction corrected or
the rejected Construction removed and replaced, and all costs and damages caused
by or resulting from such removal and replacement (including but not limited to
all reasonable fees and charges of engineers, architects, attorneys and other
professionals, all court or arbitration or other dispute resolution costs, and
all costs of repair or replacement of work of others) will be paid by
DESIGN/BUILDER, subject to the provisions of paragraph 16.06. Nothing in this
paragraph shall be interpreted or construed as requiring DESIGN/BUILDER to
correct or remove and replace defective Construction accepted by OWNER pursuant
to paragraph 12.08 below.
B. Where defective Construction (and damage to other Construction resulting
therefrom) has been corrected, removed or replaced under this paragraph 12.07,
the correction period hereunder with respect to such Construction will be
extended for an additional period of one (1) year after such correction or
removal and replacement has been satisfactorily completed.
12.08 Acceptance of Defective Construction
A. If, instead of requiring correction or removal and replacement of
defective Construction, OWNER prefers to accept it, OWNER may do so. If any such
acceptance occurs prior to final payment, a Change Order will be issued
incorporating the necessary revisions in the Contract Documents with respect to
the Construction; and OWNER shall be entitled to an appropriate decrease in the
Contract Price, and, if the parties are unable to agree as to the amount
thereof, OWNER may make a claim therefor as provided in Article 15, subject to
the provisions of paragraph 16.06 below. If the acceptance occurs after final
payment, an appropriate amount will be paid by DESIGN/BUILDER to OWNER, and, if
the parties are unable to agree as to the amount thereof, OWNER may make a claim
therefor as provided in Article 15, subject to the provisions of paragraph 16.06
below. Notwithstanding the foregoing, any defective Construction known by OWNER
and not disclosed to DESIGN/BUILDER at the time of acceptance and final payment
under paragraph 13.09 shall be deemed to be accepted by OWNER and DESIGN/BUILDER
shall have no obligation to correct, or remove and replace such defect, or make
any payment to OWNER with respect thereto.
28
ARTICLE 13-PAYMENTS TO DESIGN/BUILDER AND COMPLETION
13.01 Schedule of Values
A. The Schedule of Values established as provided in paragraph 2.05.A will
serve as the basis for progress payments and will be incorporated into a form of
Application for Payment acceptable to OWNER.
13.02 Application for Progress Payment
A. At least ten (10) days before the date established for each progress
payment (but not more often than once a month), DESIGN/BUILDER shall submit to
OWNER for review and approval an Application for Payment filled out and signed
by DESIGN/BUILDER covering the Work completed as of the date of the Application
and accompanied by such supporting documentation as is required by the Contract
Documents. The amount of retainage with respect to progress payments will be as
stipulated in the Agreement.
B. With each Application for Payment, DESIGN/BUILDER shall submit interim
lien waivers for all subcontractors and first tier suppliers with a contract
value in excess of $5,000.00. The interim lien waivers shall be effective
through the immediately preceding payment. OWNER may withhold from any progress
payment the amount applicable to any lien waivers not received for any preceding
Application for Payment for which payment was made by OWNER.
13.03 DESlGN/BUILDER's Warranty of Title
A. DESIGN/BUILDER warrants and guarantees that title to all construction
materials and equipment covered by any Application for Payment, whether
incorporated in the Project or not, will pass to OWNER no later than the time of
payment free and clear of all Liens. This paragraph 13.03.A does not apply to
any documents covered by paragraph 3.04.
13.04 Progress Payments
A. Progress payments shall be made by the OWNER to the DESIGN/BUILDER
according to the following procedure:
1. OWNER will, within ten (10) days of receipt of each Application for
Payment, either indicate in writing its acceptance of the Application and
state that the Application is being processed for payment, or return the
Application to DESIGN/BUILDER indicating in writing its reasons for
refusing to accept the Application and the exact amount(s) in dispute. All
undisputed amounts will become due and be paid by OWNER to DESIGN/BUILDER
not more than ten (10) days after OWNER'S acceptance or rejection of such
Application, as the case may be.
2. If the OWNER should fail to pay the DESIGN/BUILDER at the time the
payment of any amount becomes due, then DESIGN/BUILDER may, at any time
thereafter, upon serving written notice that DESIGN/BUILDER will stop the
Work within seven (7) days after receipt of the notice by the OWNER, and
after such seven (7) day period, stop the Work until payment of the amount
owing has been
29
received, including interest thereon. Written notice shall be deemed to have
been duly served if sent by certified mail to the last known business address of
the OWNER.
3. Payments due but unpaid shall bear interest at the rate specified in the
Agreement. Any disputed payment shall be due at the time mutually
determined by the parties or, if applicable, the time determined by the
arbitrator under paragraph 15.01.
4. No Progress Payment nor any partial or entire use or occupancy of the
Project by the OWNER shall constitute an acceptance of any Work not in
accordance with the Contract Documents.
B. OWNER may refuse to make the whole or any part of any such payment or,
because of subsequently discovered evidence or the results of subsequent
inspections or tests, nullify any previous payment, to the extent that is
reasonably necessary to protect OWNER from loss because:
1. The Work is defective, or completed Work has been damaged, requiring
correction or replacement;
2. The Contract Price has been reduced by Written Amendment or Change
Order;
3. OWNER has been required to correct defective Work or complete Work in
accordance with paragraph 12.09.A;
4. OWNER has actual knowledge of the occurrence of any of the events
enumerated in paragraphs 14.02.A.I through A.3 inclusive;
5. Claims have been made against OWNER on account of DESIGN/BUILDER's
performance or furnishing of the Work;
6. The provisions of paragraph 13.02.B are applicable; or
7. Liens have been filed in connection with the Work, except where
DESIGN/BUILDER has delivered a specific Bond satisfactory to OWNER to
secure the satisfaction and discharge of such Liens.
13.05 Substantial Completion
A. When DESIGN/BUILDER considers the Construction ready for its intended
use DESIGN/BUILDER shall notify OWNER in writing that the Construction is
substantially complete (except for items specifically listed by DESIGN/BUILDER
as incomplete) and request that OWNER issue a certificate of Substantial
Completion. Within a reasonable time thereafter, OWNER and DESIGN/BUILDER shall
make an inspection of the Construction to determine the status of completion. If
OWNER does not consider the Construction substantially complete, OWNER will
notify DESIGN/BUILDER in writing giving the reasons therefor. If OWNER considers
the Construction substantially complete, OWNER will prepare and deliver to
DESIGN/BUILDER a certificate of Substantial Completion which shall fix the date
of Substantial Completion. There shall be attached to the certificate a list of
items to be completed or corrected before final payment. Such list of items to
be completed or corrected may be amended by OWNER for a period of sixty (60)
days following the date DESIGN/BUILDER requests that OWNER issue a certificate
of Substantial Completion and DESIGN/BUILDER shall not be responsible for
completing or correcting items not listed by OWNER within such time. At the time
of delivery of the certificate of Substantial Completion OWNER will deliver
30
to DESIGN/BUILDER (i) a written determination as to division of responsibilities
pending final payment between OWNER and DESIGN/BUILDER with respect to security,
operation, safety, maintenance, heat, utilities, insurance and warranties and
guarantees, and (ii) the payment required by section 4.02.R.2. of the Agreement.
B. OWNER will have the right to exclude DESIGN/BUILDER from the Site after
the date of Substantial Completion, but OWNER will allow DESIGN/BUILDER
reasonable access to complete or correct items on the list of items to be
completed.
13.06 Final Inspection
A. Upon written notice from DESIGN/BUILDER that the entire Construction or
an agreed portion thereof is complete, OWNER will make a final inspection with
DESIGN/BUILDER and will notify DESIGN/BUILDER in writing of all particulars in
which this inspection reveals that the Construction is incomplete or defective.
DESIGN/BUILDER shall immediately take such measures as are necessary to complete
such Construction or remedy such deficiencies.
13.07 Final Application for Payment
A. After DESIGN/BUILDER has completed all such corrections to the
satisfaction of OWNER and delivered in accordance with the Contract Documents
all maintenance and operating instructions, schedules, guarantees, certificates
or other evidence of insurance required by paragraph 5.08.B, certificates of
inspection, marked-up record documents (as provided in paragraph 6.11) and other
documents, DESIGN/BUILDER may make application for final payment of the Contract
Price following the procedure for progress payments. Such final Application for
Payment shall be accompanied (unless previously delivered) by: (i) all
documentation called for in the Contract Documents, including but not limited to
the evidence of insurance required by subparagraph 5.02.B.7, (ii) consent of
the surety, if any, to final payment, and (iii) complete and legally effective
releases or waivers (satisfactory to OWNER) of all Liens arising out of or filed
in connection with the Work. In lieu of such releases or waivers of Liens and as
approved by OWNER, DESIGN/BUILDER may furnish receipts or releases in full and
an affidavit of DESIGN/BUILDER that: (i) the releases and receipts include all
labor, services, material and equipment for which a Lien could be filed, and
(ii) all payrolls, material and equipment bills and other indebtedness connected
with the Work for which OWNER or OWNER'S property might in any way be
responsible have been paid or otherwise satisfied. If any Subcontractor or
Supplier fails to furnish such a release or receipt in full, DESIGN/BUILDER may
furnish a Bond or other collateral satisfactory to OWNER to indemnify OWNER
against any Lien.
13.08 Final Payment and Acceptance
A. If OWNER is satisfied that the Work has been completed and
DESIGN/BUILDER's other obligations under the Contract Documents have been
fulfilled, OWNER will, within ten (10) days after receipt of such final
Application for Payment, give written notice to DESIGN/BUILDER that the Work is
acceptable. Otherwise, OWNER will return the Application to DESIGN/BUILDER,
indicating in writing the reasons for refusing to process final payment, in
which case DESIGN/BUILDER shall make the necessary corrections and resubmit the
Application. Thirty (30) days after the presentation to OWNER of the acceptable
Application and accompanying documentation, in appropriate form and substance
and with OWNER'S notice of acceptability, the amount will become due and will be
paid by OWNER to DESIGN/BUILDER.
31
B. If, through no fault of DESIGN/BUILDER, final completion of the Work is
significantly delayed, OWNER shall, upon receipt of DESIGN/BUILDER's final
Application for Payment, and without terminating the Agreement, make payment of
the balance due for that portion of the Work fully completed and accepted. If
the remaining balance to be held by OWNER for Work not fully completed or
corrected is less than the retainage stipulated in the Agreement, the written
consent of the surety to the payment of the balance due for that portion of the
Work fully completed and accepted shall be submitted by DESIGN/BUILDER to OWNER
with the Application for such payment. Such payment shall be made under the
terms and conditions governing final payment, except that it shall not
constitute a waiver of claims.
13.09 Waiver of Claims
A. The making and acceptance of final payment of the Contract Price will
constitute:
1. A waiver of all claims by OWNER against DESIGN/BUILDER, except claims
arising from unsettled Liens, from defective Construction appearing after
final inspection pursuant to paragraph 13.06, from failure to comply with
the Contract Documents or the terms of any special guarantees specified
therein, or from DESIGN/BUILDER's continuing obligations under the Contract
Documents; and
2. a waiver of all claims by DESIGN/BUILDER against OWNER other than those
previously made in writing and still unsettled, or from OWNER'S continuing
obligations under the Contract Documents.
ARTICLE 14--SUSPENSION OF WORK AND TERMINATION
4.01 Owner May Suspend Work
A. At any time and without cause, OWNER may suspend the Work or any portion
thereof for a period of not more than ninety (90) days by notice in writing to
DESIGN/BUILDER which will fix the date on which Work will be resumed.
DESIGN/BUILDER shall resume the Work on the date so fixed. DESIGN/BUILDER may be
allowed an adjustment in the Contract Price or an extension of the Contract
Times, or both, directly attributable to any such suspension if DESIGN/BUILDER
makes a claim therefor as provided in Article 9. If requested by DESIGN/BUILDER
in connection with the performance of the Work, OWNER shall suspend operations
of the plant and OWNER shall be responsible for any and all costs associated
with such suspension.
14.02 OWNER May Terminate for Cause
A. The occurrence of any one or more of the following events justifies
termination for cause:
1. DESIGN/BUILDER persistently fails to perform the Work in accordance with
the Contract Documents (including, but not limited to, failure to supply
sufficient skilled workers or suitable materials or equipment or failure to
adhere to the progress schedule established under paragraph 2.05.A as
revised from time to time.)
2. DESIGN/BUILDER intentionally or willfully disregards Laws or Regulations
of any puWic body having jurisdiction.
32
3. DESIGN/BUILDER otherwise breaches or violates in any material way any
provisions of the Contract Documents.
B. OWNER may, after giving DESIGN/BUILDER written notice of the occurrence
of an event in paragraph 14.02.A and twenty (20) days therefrom to remedy such
event (or, if such event is not capable of being remedied within such twenty
(20) days, such number of days as is reasonably needed to remedy such event),
and to the extent permitted by Laws and Regulations, terminate the services of
DESIGN/BUILDER, exclude DESIGN/BUILDER from the Site and take possession of the
Work incorporate in the Work all materials and equipment stored at the Site or
elsewhere for which OWNER has paid DESIGN/BUILDER and finish the Work as OWNER
may deem expedient. In such case DESIGN/BUILDER shall not be entitled to receive
any further payment other than reimbursement for DESIGN/BUILDER's payments to
Subcontractors and Suppliers for labor, services, equipment and materials prior
to the date of termination, but only to the extent not previously paid by OWNER.
If the unpaid balance of the Contract Price exceeds all reasonable costs
incurred by OWNER resulting from completing the Work (including but not limited
to all reasonable fees and charges of engineers, architects, attorneys and other
professionals and all court or arbitration or other dispute resolution costs)
such excess will be paid to DESIGN/BUILDER. If all reasonable costs incurred by
OWNER to complete the Work (including but not limited to all reasonable fees and
charges of engineers, architects, attorneys and other professionals and all
court or arbitration or other dispute resolution costs) exceed the unpaid
balance of the Contract Price, DESIGN/BUILDER shall pay the difference to OWNER
subject to the provisions of paragraph 16.06. When exercising any rights or
remedies under this paragraph OWNER shall be required to obtain a reasonable
price for the Work performed.
C. Where DESIGN/BUILDER's services have been so terminated by OWNER, the
termination will not affect any rights or remedies of OWNER against
DESIGN/BUILDER then existing or which may thereafter accrue. Any payment of
moneys due DESIGN/BUILDER by OWNER will not release DESIGN/BUILDER from
liability.
D. Nothing in this paragraph shall be interpreted or construed as requiring
DESIGN/BUILDER to perform any additional services after such termination
including, without limitation, the creation of any drawings, specifications or
any other document necessary to complete the Work.
14.03 OWNER May Terminate for Convenience
A. Prior to the date on which concrete is first poured at the Site by
DESIGN/BUILDER, OWNER may, without cause and without prejudice to any other
right or remedy of OWNER, elect to terminate the Agreement upon twenty (20) days
written notice to DESIGN/BUILDER. In such case, DESIGN/BUILDER shall be paid
(without duplication of any items) for:
1. Completed and acceptable Work executed in accordance with the Contract
Documents prior to the effective date of termination, including fair and
reasonable sums for overhead and profit on such Work;
2. Expenses sustained prior to the effective date of termination in
performing services and furnishing labor, materials or equipment as
required by the Contract Documents in connection with uncompleted Work,
plus fair and reasonable sums for overhead and profit on such expenses;
33
3. Amounts paid in settlement of terminated contracts with Subcontractors,
Engineers, Suppliers and others (including but not limited to all
reasonable fees and charges of engineers, architects, attorneys and other
professionals and all court or arbitration or other dispute resolution
costs incurred in connection with termination of contracts with
Subcontractors, Engineers and Suppliers); and
4. Reasonable expenses directly attributable to termination.
B. Except as otherwise provided in the Agreement, DESIGN/BUILDER shall not
be paid on account of loss of anticipated profits or revenue or other economic
loss arising out of or resulting from such termination.
14.04 DESIGN/BUILDER May Stop Work or Terminate
A. If, through no act or fault of DESIGN/BUILDER, the Work is suspended for
a period of more than ninety (90) days by OWNER or under an order of court or
other public authority, or OWNER fails to act on any Application for Payment
within thirty (30) days after it is submitted or OWNER fails for thirty (30)
days to pay DESIGN/BUILDER any sum finally determined to be due, then
DESIGN/BUILDER may, upon seven (7) days written notice to OWNER, and provided
OWNER does not remedy such suspension or failure within that time, terminate the
Agreement and recover from OWNER payment on the same terms as provided in
paragraph 14.03. In lieu of terminating the Agreement and without prejudice to
any other right or remedy, or OWNER has failed for thirty days to pay
DESIGN/BUILDER any sum finally determined to be due, DESIGN/BUILDER may upon
seven (7) days written notice to OWNER stop the Work until payment is made of
all such amounts due DESIGN/BUILDER, including interest thereon. The provisions
of this paragraph 14.04.A are not intended to preclude DESIGN/BUILDER from
making claim under Article 9 for an increase in Contract Price or Contract Times
or otherwise for expenses or damage directly attributable to DESIGN/BUILDER'S
stopping Work as permitted by this paragraph.
ARTICLE 15--DISPUTE RESOLUTION
15.01 Dispute Resolution Agreement
A. OWNER and DESIGN/BUILDER agree that they will first submit any and all
unsettled claims, counterclaims, disputes and other matters in question between
them arising out of or relating to the Contract Documents or the breach thereof
("disputes"), to mediation by a mutually agreeable, impartial mediator, or if
the parties cannot so agree, a mediator designated by the American Arbitration
Association ("AAA") pursuant to its Construction Industry Mediation Rules, prior
to either of them initiating against the other a demand for arbitration pursuant
to paragraph 15.01.B through 15.01.E, unless delay in initiating arbitration
would irrevocably prejudice one of the parties. Any time limits within which to
file a demand for arbitration shall be suspended with respect to a dispute
submitted to mediation within those same applicable time limits and shall remain
suspended until 10 days after the termination of the mediation. The mediator of
any dispute submitted to mediation under this Agreement shall not serve as
arbitrator of such dispute unless otherwise agreed.
B. All claims, disputes and other matters in question between OWNER and
DESIGN/BUILDER arising out of or relating to the Contract Documents or the
breach thereof (except for claims which have been waived by the making or
acceptance of final payment as provided by paragraph 13.09) will be decided by
binding arbitration in accordance with the Construction Industry Arbitration
Rules of the AAA then in
34
effect, subject to the limitations of this paragraph 15.01. The arbitrator shall
have the discretion to award reasonable attorneys' fees and costs to the
prevailing party. This agreement so to arbitrate and any other agreement or
consent to arbitrate entered into in accordance herewith as provided in this
paragraph 15.01 will be specifically enforceable under the prevailing law of any
court having jurisdiction.
C. Notice of the demand for arbitration will be filed in writing with the
other party to the Agreement and with the designated arbitration entity. The
demand for arbitration will be made within a reasonable time after the claim,
dispute or other matter in question has arisen, and in no event shall any such
demand be made after the date when institution of legal or equitable proceedings
based on such claim, dispute or other matter in question would be barred by the
applicable statute of limitations.
D. Except as provided in paragraph 15.01.E below, no arbitration arising
out of or relating to the Contract Documents shall include by consolidation,
joinder or in any other manner any other individual or' entity who is not a
party to this contract unless:
1. the inclusion of such other individual or entity is necessary if
complete relief is to be afforded among those who are already parties to
the arbitration, and
2. such other individual or entity is substantially involved in a question
of law or fact which is common to those who are already parties to the
arbitration and which will arise in such proceedings, and
3. the written consent of the other individual or entity sought to be
included and of OWNER and DESIGN/BUILDER has been obtained for such
inclusion, which consent shall make specific reference to this paragraph;
but no such consent shall constitute consent to arbitration of any dispute
not specifically described in such consent or to arbitration with any party
not specifically identified in such consent.
E. Notwithstanding paragraph 15.01.D, if a claim, dispute or other matter
in question between OWNER and DESIGN/BUILDER involves the Work of a
Subcontractor, Supplier or Engineer either OWNER or DESIGN/BUILDER may join such
entity as a party to the arbitration between OWNER and DESIGN/BUILDER hereunder.
DESIGN/BUILDER shall include in all subcontracts required by paragraph 6.05.D a
specific provision whereby the Subcontractor consents to being joined in an
arbitration between OWNER and DESIGN/BUILDER involving the Work of such
Subcontractor. Nothing in this paragraph 15.01.E nor in the provision of such
subcontract consenting to joinder shall create any claim, right or cause of
action in favor of Subcontractor, Supplier or Engineer against OWNER.
F. Notwithstanding the foregoing, the provisions of this Article 15 shall
not apply to any claim by DESIGN/BUILDER of any breach or threatened breach of
any covenant contained in Exhibit C of the Agreement or the provisions thereof.
ARTICLE 16--MISCELLANEOUS
16.01 Giving Notice
A. Whenever any provision of the Contract Documents requires the giving of
written notice, it will be deemed to have been validly given:
35
1. If delivered in person to the individual or to a member of the firm or
to an officer of the corporation for whom it is intended;
2. If delivered at or sent by registered or certified mail, postage
prepaid, to the last business address known to the giver of the notice; or
3. If transmitted by facsimile, the time at which a machine generated
confirmation states the notice was received at the facsimile telephone
number of the intended recipient last known by the sender.
16.02 Computation of Times
A. When any period of time is referred to in the Contract Documents by
days, it will be computed to exclude the first and include the last day of such
period. If the last day of any such period falls on a Saturday or Sunday or on a
day made a legal holiday by the law of the applicable jurisdiction, such day
will be omitted from the computation.
B. A calendar day of twenty-four hours measured from midnight to the next
midnight will constitute a day.
16.03 Notice of Claim
A. Should OWNER or DESIGN/BUILDER suffer injury or damage to person or
property because of any error, omission or act of the other party or of any of
the other party's employees or agents or others for whose acts the other party
is legally liable, claim will be made in writing to the other party within a
reasonable time of the first observance of such injury or damage. The provisions
of this paragraph 16.03.A shall not be construed as a substitute for or a waiver
of the provisions of any applicable statute of limitations or repose.
16.04 Cumulative Remedies
A. Except as provided in paragraph 16.06 of the General Conditions below,
the duties and obligations imposed by these General Conditions and the rights
and remedies available hereunder to the parties hereto, and, in particular but
without limitation, any general or specific warranties, guarantees and
indemnities imposed upon a party and all of the rights and remedies available to
the other party thereunder, are in addition to, and are not to be construed in
any way as a limitation of, any rights and remedies available to any or all of
them which are otherwise imposed or available by Laws or Regulations, by special
warranty or guarantee or by other provisions of the Contract Documents, and the
provisions of this paragraph will be as effective as if repeated specifically in
the Contract Documents in connection with each particular duty, obligation,
right and remedy to which they apply.
16.05 Survival of Obligations
A. All representations, indemnifications, warranties and guarantees made
in, required by or given in accordance with the Contract Documents, as well as
all continuing obligations indicated in the Contract Documents, will survive
final payment, completion and acceptance of the Work and termination or
completion of the Agreement.
16.06 Limitation on OWNER's Recovery of Damages and Waiver of
Consequential Damages
36
A. OWNER'S maximum cumulative recovery, for the Project as a whole, of
damages from DESIGN/BUILDER for OWNER'S correction of defective Construction
under paragraph 12.07.A., acceptance of defective Construction under paragraph
12.08 and/or termination for cause under paragraph 14.02 shall be limited to
$1,000,000.00.
B. Notwithstanding any other provision of the Contract Documents, OWNER
hereby waives all claims against DESIGN/BUILDER and its employees and agents for
any consequential damages that may arise out of or relate to a breach of the
Contract Documents or the performance of the Work whether arising in contract,
warranty, tort (including negligence), strict liability or otherwise, including
but not limited to losses of use, profits, business, reputation or financing.
37
Exhibit B
to
Agreement Between Owner and Design/Builder
On the Basis of a Stipulated Price
Items Included in Scope of Work:
1. Beerwell addition:
a. Provide and install all necessary foundations, piping, and tank
to add one 750,000 gallon tank to be used as a beerwell.
b. Provide and install new pump and associated piping necessary for
new beerwell.
2. Cooling tower expansion:
a. Provide and install all necessary foundations, piping, and
cooling tower to expand to three cells.
b. Provide and install new cooling tower pump.
3. Centrifuge:
a. Provide and install one "Z6" model Flottweg centrifuge with all
associated piping. Currently WPE has "Z53" model centrifuges
installed. The up sizing to a Z6 would be to allow more
flexibility in process.
4. Fourth eductor in slurry tank:
a. Provide and install 4th steam eductor in slurry tank.
5. Fermenter #4 modifications:
a. Provide and install new pump and heat exchanger for fermenter #4.
6. Scalper:
a. Provide and install necessary equipment to change scalper to
rotary scalper in current location. Any additional modifications
at owners cost.
7. RO water to lab:
a. Provide RO water to lab. Water is to be available when pump is
running. Installation of a dedicated pump is at owners cost.
8. Sulfuric Acid Line to RO System:
a. Provide and install Alloy 20 acid line to RO.
9. Xxxx water pre-heater:
a. Provide necessary changes or improvements to xxxx water
pre-heater. (45 mmgpy rate)
10. Pumps and Heat exchangers:
a. Provide and install necessary improvements to heat exchangers and
pumps as approve by engineering for expansion.
DESIGN/BUILDER proposes to provide engineering, equipment, and installation for
the above described items for OWNER. Anything not listed above is OWNER'S
responsibility, including but not limited to:
1. Any pump or heat exchanger modifications that are not required or
approved by engineering.
2. Additional piping that is approved but not described above.
3. Ethanol loading changes.
4. Any wet cake pad modifications.
5. Any other additional tanks or vessels not described above.
6. Any grain system modifications not described above.
1.
Scope of Work
Western Plains Energy LLC
Sole Responsibility
The following "scope of work" is outside the expansion of the plant to 45
million gallons, these additional work functions are requested by WPE
management:
1. Reconfigure slurry mixer to new design as per WPE
2. Add additional Sulfuric Acid Tank
3. Install trench drain to DDG building drives
4. Install additional ethanol load out pump to tank farm:
a. Re-pipe the existing pump to accommodate the new pump
b. Install piping for Rail load out to accommodate new pump
c. Reconfigure the denaturant pump piping to facilitate rail car
unloading
5. Install sulfamic acid line to xxxx water pre-heater
6. Sulfuric acid line to R.O.
7. Insurance upgrades:
a. Add additional three hydrants to locations specified
b. Add deluge system to distillation
c. Add hydrant monitors to two hydrants
8. Pump upgrades outside ICM scope of work
2.
Scope of Work by WPE Estimated Cost of
Upgrade
--------------------------------------------------------------------------
Reconfigure Slurry Tank 45,000
Add Sulfuric Acid Tank 15,000
Trench Drains DDG 10,000
Ethanol Load Out Pumps 15,000
Sulfamic Acid Lines to Xxxx 7,500
Sulfuric Acid Line to R.O. 7,500
Insurance Upgrades 100,000
Pump Upgrades 300,000
===================
Grand Total Upgrades: 500,000
3.
CONTINUTION SHEET AIA DOCUMENT G703 PAGE 1 OF 1 PAGES
_________________________________________________________________________________________________________________________________
AIA Document G702, APPLICATION AND CERTIFICATE FOR PAYMENT, APPLICATION NO.: $ -
containing Contractor's signed Certification, is attached. APPLICATION DATE: $ 38,229.00
In Tabulations below, amounts are stated to the nearest dollar. PERIOD TO:
Use Column I on Contracts where variable retainage for line items may apply. ARCHITECTS PROJECT NO: E151
----------------------------------------------------------------------------------------------------------------------------------
A | B | C | D | E | F | G | | H | I
----------------------------------------------------------------------------------------------------------------------------------
ITEM | DESCRIPTION OF WORK |SCHEDULED VALUE| WORK COMPLETED | MATERIALS | TOTAL | | |
NO. | | | --------------------| PRESENTLY | COMPLETED | | BALANCE | RETAINAGE
| | | FROM | | STORED | AND STORED | % | TO | (IF VARIBLE
| | | PREVIOUS | | (NOT IN | TO DATE |(G/C) | FINISH | RATE)
| | |APPLICATION | THIS | D OR E) | (D+E+F) | | (C-G) |
| | | (D+E) | PERIOD| | | | |
----------------------------------------------------------------------------------------------------------------------------------
1 ENGINEERING $ 750,000.00 $ -- $ -- $ -- $ -- $ -- $ 750,000.00 0
2 CONSUMABLES, ROLLING STOCK,
SPARE PARTS $ -- $ -- $ -- $ -- $ -- $ -- $ -- 0
3 SITE WORK $ 57,874.00 $ -- $ -- $ -- $ -- $ -- $ 57,874.00 0
4 CONCRETE $ 128,787.00 $ -- $ -- $ -- $ -- $ -- $ 128,787.00 0
5 STRUCTURAL $ 48,562.00 $ -- $ -- $ -- $ -- $ -- $ 48,562.00 0
6 INSULATION &
PAINT $ 88,856.00 $ -- $ -- $ -- $ -- $ -- $ 88,856.00 0
7 EQUIPMENT $1,895,101.00 $ -- $ -- $ -- $ -- $ -- $1,895,101.00 0
8 SPECIAL CONSTRUCTION $ -- $ -- $ -- $ -- $ -- $ -- $ -- 0
9 PIPING $ 487,259.00 $ -- $ -- $ -- $ -- $ -- $ 487,259.00 0
10 ELECTRICAL $ 543,561.00 $ -- $ -- $ -- $ -- $ -- $ 543,561.00 0
11 CONTINGENCY $ -- $ -- $ -- $ -- $ -- $ -- $ -- 0
---------------------------------------------------------------------------------------------------------------------------------
TOTALS $4,000,000.00 $ -- $ -- $ -- $ -- $ -- $4,000,000.00 0
----------------------------------------------------------------------------------------------------------------------------------
4.