EXHIBIT 10.1
THE ASSOCIATED GENERAL CONTRACTORS OF AMERICA
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AGC DOCUMENT NO. 410
STANDARD FORM OF DESIGN-BUILD
AGREEMENT AND GENERAL CONDITIONS
BETWEEN OWNER AND DESIGN-BUILDER
(WHERE THE BASIS OF PAYMENT IS THE COST OF THE WORK
PLUS A FEE WITH A GUARANTEED MAXIMUM PRICE)
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THIS STANDARD FORM AGREEMENT WAS DEVELOPED WITH THE ADVISE AND
COOPERATION OF THE AGC PRIVATE INDUSTRY ADVISORY COUNCIL, A NUMBER OF FORTUNE
500 OWNERS' DESIGN AND CONSTRUCTION MANAGERS WHO HAVE BEEN MEETING WITH AGC
CONTRACTORS TO DISCUSS ISSUES OF MUTUAL CONCERN. AGC GRATEFULLY ACKNOWLEDGES THE
CONTRIBUTIONS OF THESE OWNERS' STAFF WHO PARTICIPATED IN THIS EFFORT TO PRODUCE
A BASIC AGREEMENT FOR CONSTRUCTION.
TABLE OF ARTICLES
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1. AGREEMENT
2. GENERAL PROVISIONS
3. DESIGN-BUILDER'S RESPONSIBILITIES
4. OWNER'S RESPONSIBILITIES
5. SUBCONTRACTS
6. TIME
7. COMPENSATION
8. COST OF THE WORK
9. CHANGES IN THE WORK
10. PAYMENT FOR CONSTRUCTION PHASE SERVICES
11. INDEMNITY, INSURANCE, BONDS, AND WAIVER OF SUBROGATION
12. SUSPENSION AND TERMINATION OF THE AGREEMENT AND OWNER'S
RIGHT TO PERFORM DESIGN-BUILDER'S RESPONSIBILITIES
13. DISPUTE RESOLUTION
14. MISCELLANEOUS PROVISIONS
15. EXISTING CONTRACT DOCUMENTS
AMENDMENT NO. I
Owners Program
AMENDMENT NO. 2
Technology Transfer Agreement between Owner, Engineer and
Design-Builder
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This Agreement has important legal and insurance consequences. Consultation
with an attorney and insurance consultant is encouraged with respect to its
completion or modification.
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AGC DOCUMENT NO.410 o STANDARD FORM OF DESIGN-BUILD AGREEMENT AND GENERAL
CONDITIONS BETWEEN OWNER AND DESIGN-BUILDER (Where the Basis of Payment is the
Cost of the Work Plus a Fee with a Guaranteed Maximum Price)
2001 The Associated General Contractors of America
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AGC DOCUMENT NO. 410
STANDARD FORM OF DESIGN-BUILD
AGREEMENT AND GENERAL CONDITIONS
BETWEEN OWNER.AND DESIGN-BUILDER
(Where the Basis of Payment is the Cost of the Work
Plus A FEE with a Guaranteed Maximum Price)
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ARTICLE 1
AGREEMENT
This Agreement is made the............7TH..............day
of...........JULY..............in the YEAR......2003, by and between the
OWNER
PACIFIC ETHANOL, INC.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
and the
DESIGN-BUILDER
▇.▇. ▇▇▇▇▇ CO.
(A CALIFORNIA CORPORATION)
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
for services in connection with the following
PROJECT
ETHANOL PLANT - CONSTRUCTION
ETHANOL PRODUCTION AT THE MADERA SITE
Notice to the parties shall be given at the above addresses.
ARTICLE 2 - GENERAL PROVISIONS
2.1 TEAM RELATIONSHIP THE OWNER AND THE Design-Builder AGREE TO PROCEED WITH THE
Project ON the basis of trust, good faith and fair dealing and shall take all
actions reasonably necessary to perform THIS AGREEMENT IN AN ECONOMICAL and
timely MANNER, including consideration OF DESIGN MODIFICATIONS AND alternative
materials or equipment that will permit the Work to be constructed within the
Guaranteed Maximum Price (GMP) AND by THE DATES OF Substantial COMPLETION AND
Final Completion AS established by Amendment No. 1. The Design-Builder agrees to
procure, as permitted by the law of the state where the project is located, the
design phase services and furnish construction phase services as set forth
below.
2.1.1 The Design-Builder represents that it is an independent contractor and
that it is familiar with the type of work it is undertaking.
2.1.2 Neither the Design-Builder nor any of its agents or employees shall act on
behalf of or in the name of the Owner unless authorized in writing by the
Owner's Representative.
2.2 ENGINEER Engineering services shall be procured from licensed, independent
design professionals retained by the Design-Builder with consultation from Owner
as permitted by the law of the state where the Project is located. The standard
of care for engineering services performed under this Agreement shall be the
care and skill ordinarily used by members of the engineering professions
practicing under similar conditions at the same time and locality. The entity
providing engineering services shall be referred to as the Engineer and provide
separate and exclusive Professional Liability Insurance as required. The
engineering services shall be procured pursuant to a separate agreement between
the Design-Builder and the Engineer.
2.2.1 THE Engineer FOR THE Project shall BE DELTA-T CORPORATION,
2.3 EXTENT OF AGREEMENT This Agreement is solely for the benefit of the parties,
represents the entire and integrated agreement between the parties, and
supersedes all prior negotiations, representations or agreements, either written
or oral, except for the signed and dated ▇▇▇▇▇ Diversified, Inc. Agreement
titled "Summary of Terms for Secured Debt With Equity." The Owner and the
Design-Builder AGREE TO LOOK SOLELY TO EACH other with RESPECT TO THE
PERFORMANCE OF THE AGREEMENT. THE Agreement and each and every provision is for
the exclusive benefit of the Owner and the Design-Builder and not for the
benefit of any third party or any third party beneficiary, except to the extent
expressly provided in the Agreement.
2.4 DEFINITIONS
.1 The Contract DOCUMENTS consist of:
a. Change Orders and written amendments to this Agreement
including exhibits and appendices, signed by both the Owner
and the Design-Builder, including Amendment No. 1 if executed;
b. this Agreement except for the existing Contract Documents
set forth in item e. below;
c. the most current documents approved by the Owner pursuant
to Paragraph 3.1;
d. the information provided by the Owner pursuant to Clause
4.1.2.1;
e. the Contract Documents in existence at the time of
execution of this Agreement which are set forth in Article 15.
Additional Exhibits may be added to this document with proper
signature of the Owner and design-Builder;
f. the Owner's Program provided pursuant to Subparagraph 4.1.;
In case of any inconsistency, conflict or ambiguity among the Contract
Documents, the documents shall govern in the order in which they are
listed above.
.2 The term day shall mean calendar day unless otherwise specifically
defined.
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.3 DESIGN-BUILDER'S FEE means the compensation paid to the
Design-Builder for salaries and other mandatory or customary
compensation of the Design-Builder's employees at its principle and
branch offices except employees listed in Subparagraph 8.2.2, general
and administrative expenses of the Design-Builder's principal and
branch offices other than the field office, and the Design-Builder's
capital expenses, including interest on the Design-Builder's capital
employed FOR the WORK, AND PROFIT.
.4 DEFECTIVE WORK IS ANY portion of the Work not in conformance with
the Contract Documents as more fully described in Paragraph 3.8.
.5 The term Fast-track means accelerated scheduling which involves
commencing construction prior to the completion of drawings and
specifications and then using means such as bid PACKAGES AND EFFICIENT
COORDINATION TO COMPRESS THE overall schedule.
.6 FINAL COMPLETION occurs on the date when the Design-Builder's
obligations under this Agreement are complete and accepted by the Owner
and final payment becomes due and payable.
.7 A MATERIAL SUPPLIER is a party or entity retained by the
Design-Builder to provide material and equipment for the Work.
.8 Others means other contractors and all persons at the Worksite who
are not employed by Design-Builder, its Subcontractors or Material
Suppliers.
.9 The OWNER is the person or entity identified as such in this
Agreement and includes the Owner's Representative.
.10 The OWNER'S PROGRAM IS an initial description of the Owner's
objectives, that may include budget and time criteria, space
requirements and relationships, flexibility and expandability
requirements, special equipment and systems, and site requirements
completed by the Design-Builder and Engineer as described in Exhibit
No. C; Project Development Agreement.
.11 The PROJECT, as identified in Article 1, is the building, facility
and/or other improvements for which the Design-Builder is to perform
the Work under this Agreement It may also include improvements to be
undertaken by the Owner or Others.
.12 A SUBCONTRACTOR IS A party or entity retained by the Design-Builder
as. an independent contractor to provide the on-site labor, materials,
equipment and/or services necessary to complete a specific portion of
the Work. The term Subcontractor does not include the Engineer or any
separate contractor employed by the Owner or any separate contractor's
subcontractors.
.13 SUBSTANTIAL COMPLETION OF THE WORK, OF a designated portion, occurs
on the date when the Design-Builder's obligations are sufficiently
complete in accordance with the Contract Documents so that the Owner
can or does occupy or utilize the Project, or a designated portion, for
the use for which it is intended, in accordance with Paragraph 10.4.
The issuance of a Certificate of Occupancy is not a prerequisite for
Substantial Completion if the Certificate of Occupancy cannot be
obtained due to factors. beyond the Design-Builder's control. This date
shall be confirmed by a Certificate of Substantial Completion signed by
the Owner and the Design-Builder. The Certificate shall state the
respective responsibilities of the Owner and the Design-Builder for
security, maintenance, heat, utilities, damage to the Work, and
insurance. The Certificate shall also list the items to be completed or
corrected, and establish the time for their completion and correction,
within the time frame, if any, established in Amendment No. I for the
Date of Final Completion.
.14 A SUB-SUBCONTRACTOR IS a party or entity who has an agreement with
a Subcontractor to perform any portion of the Subcontractor's work.
.15 The WORK is the Design Development and Design Phase Services
procured or furnished in accordance with Paragraph 3.1, the GMP
Proposal provided in accordance with Paragraph 3.2, the Construction
Phase Services provided in accordance with Paragraph 3.3, Additional
Services that may be provided in accordance with paragraph 3.10, and
other services which are necessary to complete the Project in
accordance with and reasonably inferable from the Contract Documents.
3
.16 WORKSITE means the geographical area at the location mentioned in
Article where the Work is to be performed.
ARTICLE 3 -DESIGN-BUILDER'S RESPONSIBILITIES
THE Design-Builder shall be responsible for procuring the design and for
furnishing the construction of the Work consistent with the Owner's Program; as
such the Owner may modify the Program during the course of the work up to
twenty-five (25)-percent design complete. The Design-Builder shall exercise
reasonable skill and judgment in the performance of its services consistent with
the team relationship described in Paragraph 2.1, but does not warrant nor
guarantee schedules and estimates other than those that are part of the GMP
proposal.
3.1 DESIGN PHASE SERVICES
3.1.1 PRELIMINARY EVALUATION - OWNER'S PROGRAM The Design-Builder shall review
the Owner's Program to ascertain the requirements of the Project and shall
verify' such requirements with the Owner. The Design-Builder's review shall also
provide to the Owner a preliminary evaluation of the site with regard to access,
traffic, drainage, parking, building placement and other considerations
affecting the plant, the environment and energy use, as well as information
regarding applicable governmental laws, regulations and requirements based on
the requirements of Exhibit No. C. The Design-Builder shall also propose, as
necessary, alternative architectural, civil, structural, mechanical, electrical
and other systems for review by the Owner, to determine the most desirable
approach on the basis of cost, technology, quality and speed of delivery. The
Design-Builder will also review existing test reports but will not undertake any
independent testing nor be required to furnish types of information derived
from. such testing in its Preliminary Evaluation. Based upon its review and
verification of the Owner's Program and other relevant information the
Design-Builder shall provide a Preliminary Evaluation of the Project's
feasibility for the Owner's acceptance. The Design-Builder's Preliminary
Evaluation shall specifically identify any deviations from the Owner's Program.
3.1.2 PRELIMINARY SCHEDULE - OWNER"S PROGRAM The Design-Builder shall prepare a
preliminary schedule of the Work as established by the information provide by
the Engineer in Exhibit No. C. The Owner shall provide written approval of
milestone dates established in the preliminary schedule of the Work. The
schedule shall show the activities of the Owner, the Engineer and the
Design-Builder necessary to meet the Owner's completion requirements. The
schedule shall be updated periodically with the level of detail for each
schedule update reflecting the information then available. If an update
indicates that a previously approved schedule will not be met, the
Design-Builder shall recommend corrective action to the Owner in writing.
3.1.3 PRELIMINARY ESTIMATE -- OWNER'S PROGRAM ' When sufficient Project
information has been identified, the Design-Builder shall prepare for the
Owner's acceptance a preliminary estimate established by the information
provided by the Engineer in Exhibit No. C utilizing typical ▇.▇. ▇▇▇▇▇ CO.
estimating techniques. The estimate shall be updated periodically with the level
of detail for each estimate update reflecting the information then available. If
the preliminary estimate or any update exceeds the Owner's budget, the
Design-Builder shall make recommendations to the Owner.
3.1.4 DESIGN DEVELOPMENT DOCUMENTS - OWNER'S PROGRAM The Design-Builder shall
submit for the Owner's written approval the Design Development Documents as
submitted by the Engineer and required in Exhibit No. C signed by the
Design-Builder and Engineer based on the approved Schematic Design Documents.
The Design Development Documents shall further define the Project including
drawings and outline specifications fixing and describing the Project size and
character as to site utilization, and other appropriate elements incorporating
the structural, architectural, mechanical and electrical systems. One set of
these documents shall be furnished to the Owner. When the Design-Builder submits
the Design Development Documents, the Design-Builder shall identify in writing
all material changes and deviations that have taken place from the Schematic
Design Documents. The Design-Builder shall update the schedule and estimate
based on the Design Development Documents.
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3.1.5 TECHNOLOGY TRANSFER AGREEMENT AND FUTURE DESIGN SERVICES AGREEMENT Upon
execution of Exhibit No. C, the Owner, Engineer and Design-Builder shall enter
into good-faith negotiations for the Technology Transfer Agreement and the
Design-Builder and Engineer shall enter into good-faith negotiations for the
Design Services Agreement. Upon confirmation that the Owner has obtained the
necessary Project Financing, the Technology Transfer Agreement and Design
Services agreement shall be fully executed so as to not delay the project.
3.1.6 CONSTRUCTION DOCUMENTS Upon confirmation that the Owner has obtained the
necessary Project Financing, the Design-Builder shall submit for the Owner's
written approval Construction Documents based on the approved Design Development
Documents. The Construction Documents shall set forth in detail the requirements
for construction of the Work, and shall consist of drawings and specifications
based upon codes, laws and regulations enacted at the time of their preparation.
When the Design-Builder submits the Construction Documents, the Design-Builder
shall identify in writing all material changes and deviations that have taken
place from the Design Development Documents. Construction shall be in accordance
with these approved Construction Documents. One set of these documents shall be
furnished to the Owner prior to commencement of construction.
3.1.7 OWNERSHIP OF DOCUMENTS Upon the making of payment pursuant to Paragraph
10.5, the Owner shall receive ownership of the property rights, except for
copyrights and other limited license information provided and required by the
Engineer, of all documents, drawings, specifications, electronic data and
information prepared, provided OR PROCURED by the Design-Builder, its Engineer,
Subcontractors and Consultants and distributed to the Owner for this Project.
("Design-Build Documents")
.1 If this Agreement is terminated pursuant to Paragraph 12.1, the
Owner shall receive ownership of the property rights, except for
copyrights and other limited license information provide by the
Engineer, of the Design-Build Documents upon payment for all work
performed in accordance with this Agreement, at which time the Owner
shall have the right to use, reproduce and make derivative works from
the Design-Build Documents to complete the Work.
.2 If this Agreement is terminated pursuant to Paragraph 12.2, the
Owner shall receive ownership of the property rights, except for
copyrights and other limited license information provide by the
Engineer, of the Design-Build Documents upon payment of all sums
provided in Paragraph 12.2, at which time the Owner shall have the
right to use, reproduce and make derivative works from the Design-Build
Documents to complete the Work.
.3 The Owner may use, reproduce and make derivative works from the
Design-Build documents for subsequent renovation and remodeling of the
work, but shall not use, reproduce or make derivative works from the
Design-Build Documents for other projects without the written
authorization of the Design-Builder and Engineer, who shall not
unreasonably withhold consent.
.4 The Owner's use of the Design-Build Documents without the
Design-Builder's involvement or on other projects is at the Owner's
sole risk, except for the Design-Builder's indemnification obligation
pursuant to Paragraph 3.7, and the Owner shall defend, indemnify and
hold harmless the Design-Builder, its Engineer, Subcontractors, and
consultants, and the agents; officers, directors and employees of each
of them from and against any and all claims, damages, losses, costs
'and expenses, including but not limited to attorney's fees, costs and
expenses incurred in connection with any dispute resolution process,
arising out of or resulting from the Owner's use of the Design-Build
Documents.
.5 The Design-Builder shall obtain from its Engineer, Subcontractors
and consultants property rights and rights of use that correspond to
the rights given by the Design-Builder to the Owner in this Agreement.
3.2 GUARANTEED MAXIUM PRICE (GMP)
3.2.1 GMP PROPOSAL The GMP shall be the sum of the estimated Design-Builder's
Time and Material Cost of the work as defined in Article 8 and listed in Exhibit
No. B, Design-Builder's Fee as defined in Article land the Design-Builder's
Contingency as defined in Article 3.2.7. The GMP is subject to modification as
provided in Article 9.
3.2.1.1 The Design-Development Documents shall be sufficiently complete at the
time the GMP Proposal is submitted to the Owner. The Design-Builder shall
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provide in the GMP for further development of the Design-Build Documents
consistent with the Owner's Program. Such further development does not include
changes in scope, systems, kinds and quality of materials, finishes or
equipment, all of which if required, shall be incorporated by Change Order.
3.2.2 BASIS OF GUARANTEED MAXIMUM PRICE The Design-Builder shall include with
the GMP Proposal a written statement of its scope of work and basis, which shall
include:
.1 A list of the drawings and specifications, including all addenda,
which were used in preparation of the GMP Proposal;
.2 current Time and Material worksheet (Exhibit No. B);
.3 a list of the assumptions and clarifications made by the
Design-Builder in the preparation of the GMP Proposal to supplement the
information contained in the drawings and specifications;
.4 The Date of Substantial Completion and/or the Date of Final
Completion upon which the proposed GMP is based, and the Schedule of
Work upon which the Date of Substantial Completion and/or the Date of
Final Completion is based;
.5 a schedule of applicable alternate prices and unit prices if
necessary;
.6 Additional Services if any;
.7 the time limit for acceptance of the GMP proposal;
.8 the Design-Builder's Contingency as provided in Subparagraph 3.2.6;
.9 a statement of any work to be self performed by the Design-Builder;
and
.10 A statement identifying all patented or copyrighted materials,
methods or systems selected by the Design-Builder and incorporated in
the Work that are likely to require the payment of royalties or license
fees.
3.2.3 REVIEW AND ADJUSTMENT TO GMP PROPOSAL The Design-Builder shall meet with
the Owner to review the GMP Proposal. In the event that the Owner has any
comments relative to the GMP Proposal, or finds any inconsistencies or
inaccuracies in the information presented, it shall give prompt written notice
of such comments or findings to the Design-Builder, who shall make appropriate
adjustments to the GMP, its basis or both.
3.2.4 ACCEPTANCE OF GMP PROPOSAL Upon acceptance by the Owner of the GMP
Proposal, as MAY be amended by the Design-Builder in accordance with
Subparagraph 3.2.3, THE GMP AND ITS BASIS shall be set forth in Amendment No. 1.
The GMP and the date of Substantial Completion and/or the date of Final
Completion shall be subject to modification in Article 9.
3.2.5 FAILURE TO ACCEPT THE GMP PROPOSAL Unless the Owner accepts the GMP
Proposal in writing on or before the date specified in the GMP Proposal for such
acceptance and so notifies the Design-Builder, the GMP Proposal shall not be
effective. If the Owner fails to accept the GMP Proposal, or rejects the GMP
Proposal, the Owner shall have the right to:
.1 Suggest modifications to the GMP Proposal. If such modifications are
accepted in writing by Design-Builder, the GMP Proposal shall be deemed
accepted in accordance with Subparagraph 3.2.4;
.2 Direct the Design-Builder to proceed on the basis of reimbursement
as provided in Articles 7 and 8 without A GMP, in which case all
references in this agreement to the GMP shall not be applicable; or
In the absence of a GMP the parties may establish a Date of Substantial
Completion and/or a Date of Final Completion.
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3.2.6 DESIGN-BUILDER'S CONTINGENCY The GMP Proposal will contain, as part of the
estimated Cost of the Work, the Design-Builder's Contingency, a sum mutually
agreed upon and monitored by the Design-Builder and the Owner for use at the
Design-Builder's discretion to cover costs which are properly reimbursable as a
Cost of the Work but are not the basis for a Change Order. Any contingency
amount remaining after Owner's start=up and use of the project shall be
equitably split between the Design-Builder and Owner on a 50/50 basis.
3.2.7 CONSTRUCTION PHASE SERVICES The Construction. Phase will commence upon the
confirmation that the Owner has obtained the necessary Project Financing and
issuance by the Owner of a written notice to proceed with construction.
32.8 In order to complete the Work, the Design-Builder shall provide all
necessary construction supervision, construction equipment, labor, materials,
tools, and subcontracted items.
3.2.9 The Design-Builder shall give all notices and comply with all laws and
ordinances legally enacted at the date of execution of the Agreement which
govern the proper performance of the Work.
3.2.10 The Design-Builder shall keep such full and detailed accounts as are
necessary for proper financial management under this Agreement. The Owner shall
be afforded access to all the Design-Builder's records, books, correspondence,
instructions, drawings, receipts, vouchers., memoranda and similar data relating
to this Agreement. The Design-Builder shall preserve all such records for a
period of three years after the final payment or longer where required by law.
3,2.11 The. Design-Builder shall provide periodic written reports to the Owner
on the progress of the Work in such detail as agreed to by the Owner and the
Design-Builder.
3.2.12 The Design-Builder shall develop a system of cost reporting for the Work,
including regular monitoring of actual costs for activities in progress and
estimates for uncompleted tasks and proposed changes in the Work. The reports
shall be presented to the Owner at mutually agreeable intervals.
3.2.13 The Design-Builder shall regularly remove debris and waste materials at.
the Worksite resulting from the Work. Prior to discontinuing Work in an area,
the Design-Builder shall clean the area and remove all rubbish and its
construction equipment, tools, machinery, waste and surplus materials. The
Design-Builder shall minimize and confine dust and debris resulting from
construction activities. At the completion of the Work, the Design-Builder shall
remove from the Worksite all construction equipment, tools, surplus materials,
waste materials and debris.
3.2.14 The Design-Builder shall prepare and submit to the Owner final marked up
as-built drawings in general documenting how the various elements of the Work
including changes were actually constructed or installed, or as defined by the
parties by attachment to this Agreement.
3.3 SCHEDULE OF THE WORK THE Design-Builder shall prepare and submit a final
Schedule of work for the Owner's Acceptance and Written Approval as to
Milestone Dates. This schedule shall indicate the dates for the start and
Completion of the various stages of the Work, including The dates when
information and 'approvals are required from the Owner. The Schedule shall be
revised as required by the conditions of the Work.
3.4 SAFETY OF PERSONS AND PROPERTY
3.4.1 SAFETY PRECAUTIONS AND PROGRAMS The Design-Builder shall have overall
responsibility for safety precautions and programs in the performance of the
Work. While the provisions of this Paragraph establish the responsibility for
safety between the Owner and the Design-Builder, they do not relieve
Subcontractors of their responsibility for the safety of persons or property in
the performance of their work, nor for compliance with the provisions of
applicable laws and regulations.
3.4.2 The Design-Builder shall seek to avoid injury, loss or damage to persons
or property by taking reasonable steps to protect:
.1 its employees and other persons at the Worksite;
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.2 materials, supplies and equipment stored at the Worksite for use in
performance of the Work; and
.3 the Project and all property located at the Worksite and adjacent to
work areas, whether or not said property or structures are part of the
Project or involved in the Work.
3.4.3 DESIGN-BUILDER'S SAFETY PROGRAM The Design-Builder's On-Site Safety
Program shall include all OSHA required elements and the following components:
.1 Established and administrated on-site Drug Prevention and Alcohol
Testing Program.
.2 Established and administrated on-site Safety Orientation Training
and Education Program.
3.4.4 DESIGN-BUILDER'S SAFETY REPRESENTATIVE The Design-Builder shall designate
an individual at the Worksite in the employ of the Design-Builder who shall act
as the Design-Builder's designated safety representative with a duty to prevent
accidents. The Design-Builder will. report immediately in writing all accidents
and injuries occurring at the Worksite to the Owner. If the Design-Builder is
required to file an accident report with a public authority, the Design-Builder
shall furnish a copy of the report to the Owner.
3.4.5 The Design-Builder shall provide the Owner with copies of all notices
required of the Design-Builder by law or regulation. The Design-Builder's safety
program shall comply with the requirements of governmental and
quasi-governmental authorities having jurisdiction over the Work.
3.4.6 Damage or loss not insured under property insurance which may arise from
the performance of the Work, to the extent of the negligence attributed to such
acts or omissions of the Design-Builder, or anyone for whose acts the
Design-Builder may be liable, shall be promptly remedied by the Design-Builder.
Damage or loss attributable to the acts or omissions of the Owner or Others and
not to the Design-Builder shall be promptly remedied by the Owner.
3.4.7 If the Owner or Owner's representative deems any part of the Work or
Worksite unsafe, the Owner, without assuming responsibility for the
Design-Builder's safety program, may require the Design-Builder to stop
performance of the Work or take corrective measures satisfactory to the Owner,
or both. The Design-Builder agrees to make no claim for damages, for an increase
in the GMP, compensation for Design Phase Services, the Design-Builder's Fee
and/or the Date of Substantial Completion and/or the Date of Final Completion
based on the Design-Builder's compliance with the Owner's reasonable request.
3.5 HAZARDOUS MATERIALS
3.5.1 A Hazardous Material is any substance or material identified now or in the
future as hazardous under any federal, state or local law or regulation, or any
other substance or material which may be considered hazardous or otherwise
subject to statutory or regulatory requirements governing handling, disposal
and/or clean-up. The Design-Builder shall not be obligated to commence or
continue work until all Hazardous Material discovered at the Worksite has been
removed, rendered or determined to be harmless by the Owner as certified by an
independent testing laboratory approved by the appropriate government agency.
3.5.2 If after the commencement of the Work, Hazardous Material is discovered at
the Project, the Design-Builder shall be entitled to immediately stop Work in
the affected area. The Design-Builder shall report the condition to the Owner
and, if required, the government agency with jurisdiction. The Design-Builder
reserves the right to remove any identified Hazardous Material under a separate
Time and Material Contract.
3.5.3 The Design-Builder shall not be required to perform any Work relating to
or in the area of Hazardous Material without written mutual agreement.
3.5.4 The Owner shall be responsible for retaining an independent testing
laboratory to determine the nature of the material encountered and weather it is
a Hazardous Material requiring corrective measures and/or remedial action. Such
measures shall be the sole responsibility of the Owner, and shall be performed
in a manner minimizing any adverse effects upon the Work of the Design-Builder.
The Design-Builder shall resume Work in the area affected by any Hazardous
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Material only upon written agreement between the parties after the Hazardous
Material has been removed or rendered harmless and only after approval, if
necessary, of the governmental agency or agencies with jurisdiction.
3.5.5 If the Design-Builder incurs additional costs and/or is delayed due to the
presence or remediation OF Hazardous Material, the Design-Builder shall be
entitled to an equitable adjustment in the GMP, compensation for Design Phase
Services, the Design-Builder's Fee and/or the Date of Substantial Completion
and/or the Date of Final Completion.
3.5.6 Provided the Design-Builder, its Subcontractors, Material Suppliers and
Sub-subcontractors, and the agents, officers, directors and employees of each of
them, have not, acting under their own authority, knowingly entered upon any
portion of the Work containing Hazardous Materials, and to the extent not caused
by the negligent acts or omissions of the Design-Builder, its Subcontractors,
Material Suppliers and Sub-subcontractors, and the agents, officers, directors
and employees of each of them, the Owner shall defend, indemnify and hold
harmless the Design-Builder, its Subcontractors and Sub-subcontractors, and the
agents, officers, directors and employees of each of them, from and against any
and all direct claims, damages, fosses, costs and expenses, including but not
limited to attorney's fees, costs and expenses incurred in connection with any
dispute resolution process, arising out of or relating to the performance of the
Work in any area affected by Hazardous Material. To the fullest extent permitted
by law, such indemnification shall apply regardless of the fault, negligence,
breach of warranty or contract, or strict liability of the Owner.
3.5.7 Material Safety Data (MSD) sheets as required by law and pertaining to
materials or substances used or consumed in the performance of the Work, whether
obtained by the Design-Builder, Subcontractors, the Owner or Others, shall be
maintained at the Project by the Design-Builder and made available to the Owner
and Subcontractors.
3.5.8 During the Design-Builder's performance of the Work, the Design-Builder
shall be responsible for the proper handling of all materials brought to the
Worksite by the Design-Builder. Upon the issuance of the Certificate of
Substantial Completion, the Owner shall be responsible under this Paragraph for
materials and substances brought to the site by the Design-Builder if such
materials or substances are required by the Contract Documents.
3.5.9 The terms of this Paragraph 3.5 shall survive the completion of the Work
under this Agreement and/or any termination of this Agreement.
3.6 ROYALTIES, PATENTS AND COPYRIGHTS The Design-Builder shall pay all royalties
and license fees which may be due on the inclusion of any patented or
copyrighted materials, methods or systems selected by the Design-Builder and
incorporated in the Work. The Design-Builder shall defend, indemnify and hold
the Owner harmless from all suits or claims for infringement of any patent
rights or copyrights arising out of such selection. The Owner agrees to defend,
indemnify and hold the Design-Builder and Engineer harmless from all suits or
claims OF infringement of any patent rights or copyrights arising out of any
patented or copyrighted materials, methods or systems specified by the Owner.
3.7 WARRANTIES AND COMPLETION
3.7.1 The Design-Builder warrants that all materials and equipment furnished
under the Construction Phase of this Agreement will be new unless otherwise
specified, of good quality, in conformance with the Contract Documents, and free
from defective workmanship and materials. Warranties shall commence on the Date
of Substantial Completion of the Work or of a designated portion. The
Design-Builder agrees to correct all construction performed under this Agreement
which is defective in construction workmanship or materials within a period of
one year from the Date of Substantial Completion.
3.7.2 To the extent products, equipment, systems or materials incorporated in
the Work are specified and purchased by the Owner, they shall be covered
exclusively by the warranty of the manufacturer. There are no warranties that
extend beyond the description on the face of any such warranty. To the extent
products, equipment, systems or materials incorporated in the Work are specified
by the Owner but purchased by the Design-Builder and are inconsistent with
selection criteria that otherwise would have been followed by the
Design-Builder, the Design-Builder shall assist the Owner in pursuing warranty
claims. ALL OTHER WARRANTIES EXPRESSED OR IMPLIED INCLUDING THE WARRANTY OF
MERCHANTABILITY AND THE WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE ARE
EXPRESLY DISCLAIMED.
9
3.7.3 The Design-Builder shall secure required certificates of inspection,
testing or approval and deliver them to the Owner.
3.7.4 The Design-Builder shall collect all written warranties and equipment
manuals and deliver them to the Owner in a format directed by the Owner.
3.7.5 With the assistance of the Owner's maintenance personnel, the
Design-Builder shall direct the checkout of utilities and start-up operations,
and adjusting and balancing of systems and equipment for readiness.
3.8 CONFIDENTIALITY The Design-Builder shall treat as confidential and not
disclose to third persons, except Subcontractors, Sub-subcontractors and the
Engineer as is necessary for the performance of the Work, or use for its own
benefit any of the Owner's developments, confidential information, know-how,
discoveries, production methods and the like that may be disclosed to the
Design-Builder or which the Design-Builder may acquire in connection with the
Work. The Owner shall treat as confidential information all of the
Design-Builder's estimating systems historical and parameter cost data and the
Engineer's Design/Process information that may be disclosed to the Owner in
connection with the performance of this Agreement.
3.9 ADDITIONAL SERVICES The. Design-Builder shall provide or procure the
following Additional Services upon the request of the Owner. A written agreement
between the Owner and the DESIGN-Builder shall define the extent of such
Additional Services before they are performed by the Design-Builder. If a GMP
has been established for the Work or any portion of the Work, such Additional
Services shall be considered a Change in the Work, unless they are specifically
included in the statement of the basis of the GMP as set forth in Amendment No.
1.
.1 Consultations, negotiations, and documentation supporting the
procurement of Project financing.
.2 Surveys, site evaluations, legal descriptions and aerial
photographs.
.3 Appraisals of existing equipment, existing properties, new equipment
and developed properties.
.4 Consultations and representations before governmental authorities or
others having jurisdiction over the Project other than normal
assistance in securing building permits.
.5 Investigation or making measured drawings of existing conditions or
the reasonably required verification of Owner-provided drawings and
information.
.6 Artistic renderings, models and mockups of the Project or any part
of the Project or the Work.
.7 Estimates, proposals, appraisals, consultations, negotiations and
services in connection with the repair or replacement of an insured
loss, provided such repair or replacement did not result from the
negligence of the Design-Builder.
.8 Obtaining service contractors and training maintenance personnel,
assisting and consulting in the use of systems and equipment after the
initial start up.
.9 Services for tenant or rental spaces not a part of this Agreement.
.10 Services requested by the Owner or required by the Work which are
not specified in the Contract Documents and which are not normally part
of generally accepted design and construction practice.
.11 Serving or preparing to serve as an expert witness in connection
with any proceeding, legal or otherwise, regarding the Project.
.12 Document reproduction exceeding the limits provided for in this
Agreement.
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3.10 DESIGN-BUILDER'S REPRESENTATIVE The Design-Builder shall designate a person
who shall be the Design-Builder's authorized representative. The
Design-Builder's Representative is: ▇▇. ▇▇▇▇ ▇▇▇▇▇.
ARTICLE 4 - OWNER'S RESPONSIBILITIES
4.1 INFORMATION AND SERVICES PROVIDED BY OWNER
4.1.1 The Owner shall provide full information in a timely manner regarding
requirements for the Project, including the Owner's Program and other relevant
information.
4.1.2 The Owner shall provide:
.1 all available information describing the physical characteristics of
the site, including surveys, site evaluations, legal descriptions,
existing conditions, subsurface and environmental studies, reports and
investigations;
.2 inspection and testing services during construction as required by
law or as mutually agreed; and
.3 unless otherwise provided in the Contract Documents, necessary
approvals, site plan review, rezoning, easements and assessments, fees,
permits and charges required for the construction, use, occupancy or
renovation of permanent structures, including legal and other required
services.
4.1.3 The Owner shall provide reasonable evidence satisfactory to the
Design-Builder, prior to commencing the Work and during the progress of the
Work, that sufficient funds are available and committed for the entire cost of
the Project, including a reasonable allowance for changes in the Work as may be
approved in the course of the Work. Unless such reasonable evidence is provided,
the Design Builder shall not be required to commence or continue the Work. The
Design-Builder may stop Work after seven (7) days written notice to the Owner if
such evidence is not presented within a reasonable time. THE failure of the
Design-Builder to insist upon the providing of this evidence at any one time
shall not be a waiver of the Owner's obligation to make payments pursuant to
this Agreement, nor shall it be a waiver of the Design-Builder's right to
require that such evidence be provided at a later date.
4.1.4 The Design-Builder shall be entitled to rely on the completeness and
accuracy of the information and services required by this Paragraph 4.1.
4.2 RESPONSIBILITIES DURING DESIGN PHASE
4.2.1 The Owner shall provide information for the Owner's Program at the
inception of the Design Phase and shall review. and timely approve in writing
all schedules, estimates, Preliminary Estimate, Schematic Design Documents,
Design Development Documents and Construction Documents furnished during the
Design Phase as set forth in Paragraph 3.1, and the GMP Proposal as set forth in
Paragraph 3.2.
4.2.2 The Owner shall provide good-faith negotiations in a timely manner so as
not to delay any contractual agreements.
4.3 RESPONSIBILITIES DURING CONSTRUCTION PHASE
4.3.1 The Owner shall review the Schedule of the Work as set forth in Paragraph
3.3 and timely approve the milestone dates set forth.
4.3.2 If the Owner becomes aware of any error, omission or failure to meet the
requirements of the Contract Documents or any fault or defect in the Work, the
Owner shall give prompt written notice to the Design-Builder.
4.3.3 The Owner shall communicate with the Design-Builder's Subcontractors,
Material Suppliers and the Engineer only through or in the presence of the
Design-Builder. The Owner shall have no contractual obligations to
Subcontractors, suppliers, or the Engineer.
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4.3.4 The Owner shall provide insurance for the Project as provided in Article
11.
4.4 OWNER'S REPRESENTATIVE The Owner's Representative is ▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇. The
Representative:
.1 shall be fully acquainted with the Project;
.2 agrees to furnish the information and services required of the Owner
pursuant to Paragraph 4.1 so as not to delay the Design-Builder's Work;
and
.3 shall have authority to bind the Owner in all matters requiring the
Owner's approval, authorization or written notice if the Owner changes
its representative or the representative's authority as listed above,
the Owner shall notify the Design-Builder in writing in advance.
4.5 TAX EXEMPTION If in accordance with the Owner's direction the Design-Builder
may claim an exemption for taxes and the Owner shall defend, indemnify and hold
the Design-Builder harmless for all liability, penalty, interest, fine, tax
assessment, attorney's fees: or other expense or cost incurred by the
Design-Builder as a result of any action taken by the Design-Builder in
accordance with the Owner's direction.
ARTICLE 5 -- SUBCONTRACTS
Work not performed by the Design-Builder with its own forces shall be performed
by Subcontractors or the Engineer.
5.1 RETAINING SUBCONTRACTORS The Design-Builder shall not retain any
subcontractor to whom the Owner has a reasonable and timely objection, provided
that the Owner agrees to compensate the Design-Builder for any additional costs
incurred by the Design-Builder as a result of such objection. The Owner may
propose subcontractors to be considered by the Design-Builder. The
Design-Builder shall not be required to retain any subcontractor to whom the
Design-Builder has a reasonable objection.
5.2 MANAGEMENT OF SUBCONTRACTORS The Design-Builder shall be responsible for the
management of the Subcontractors in the performance of their work and require
all Subcontractors and third party sub-subcontractors and suppliers, as
necessary, to comply with all of the provisions of the Agreement.
5.4 BINDING OF SUBCONTRACTORS AND MATERIALS SUPPLIERS The Design-Builder agrees
to bind every Subcontractor and Material Supplier (and require every
Subcontractor to so bind its Sub-subcontractors and Material Suppliers) to all
the provisions of this Agreement and the Contract Documents as they apply to the
Subcontractor's and Material Supplier's portions of the Work.
5.5 LABOR RELATIONS As of the date of this Agreement, the Design-Builder is
signatory to the following labor agreements:
1. Northern Operating Engineers
2. Northern Laborers
3. Northern Utility Fitters
ARTICLE 6 - TIME
6.1 DATE OF COMMENCEMENT Time is of the essence. The Date of Commencement is the
effective date of this Agreement as first written in Article 1. The Work shall
proceed in general accordance with the Schedule of Work as such schedule may be
amended from time to time, subject, however, to other provisions of this
Agreement.
6.2 SUBSTANTIAUFINAL COMPLETION Unless the parties agree otherwise, the Date of
Substantial Completion and/or the Date of Final Completion shall be established
in Amendment No. 1 to this Agreement subject to adjustments as provided for in
the Contract Documents. If such dates are not established upon the execution of
this Agreement of such time as a GMP is ______ a Date of Substantial Completion
and/or Date of Final Completion of the Work shall be established in Amendment
No. 1.
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6.2.1 Time limits stated in the Contract Documents are of the essence.
6.2.2 Unless instructed by the Owner in writing, the Design-Builder shall not
knowingly commence the Work before the effective date of insurance that is
required to be provided by the Design-Builder or the Owner.
6.3 DELAYS IN THE WORK
6.3.1 If causes beyond the Design-Builder's control delay the progress of the
Work, then the GMP, compensation for Design Phase Services, the Design-Builder's
Fee and/or the Date of Substantial Completion and/or the Date of Final
Completion shall be modified by Change Order as appropriate. Such causes shall
include but not be limited to: changes ordered in the Work, acts or omissions of
the Owner or Others, the Owner preventing the Design-Builder from performing the
Work pending dispute resolution, Hazardous Materials or differing site
conditions. Causes beyond the control of the Design-Builder do not include acts
or omissions on the part of the Design-Builder, Subcontractors,
Sub-subcontractors, Material Suppliers or the Engineer.
6.3.2 To the extent a delay in the progress of the Work is caused by adverse
weather conditions not reasonably anticipated, fire, unusual transportation
delays, general labor disputes impacting the Project but not specifically
related to the Worksite, governmental agencies, or unavoidable accidents or
circumstances, the Design-Builder shall only be entitled to its actual costs
without fee and an extension of the Date of Substantial Completion and/or the
Date of Final Completion.
6.3.3 In the event delays to the Project are encountered for any reason, the
parties agree to undertake reasonable steps to mitigate the effect of such
delays.
ARTICLE 7 - COMPENSATION
7.1 DESIGN PHASE COMPENSATION
7.1.1 To the extent required by applicable law, the cost of services performed
directly by the Engineer is computed separately and detailed in Exhibit No. C
attached hereto. The Engineer's Design-Phase Compensation is independent from
the Design-Builder's compensation for work or services performed directly by the
Design-Builder; these costs shall be shown as separate items on applications for
payment.
7.12 The Owner shall compensate the Design-Builder for services performed during
the Design Phase As Described in Paragraph 3.1 And Included in Exhibit No. C
executed by the Design-Builder and Engineer, including preparation of a GMP
Proposal as described in Paragraph 3.2, as follows: Time and Material Costs as
outlined in Exhibit No. B for the development of the Owner's Program,
establishing the project requirements, general business planning and other
Information and documentation as may be required to establish the feasibility of
the project, making revisions to the Schematic Design, design Development,
Design, coordination, management, expediting and other services supporting the
procurement of materials to be obtained, or work to be performed, by the Owner,
including but not limited to telephone systems, computer wiring networks, sound
systems, alarms, security systems and other specialty systems which are not a
part of the Work, Preliminary Construction Schedules and Estimates, Construction
Documents forming the basis of the GMP.
7.1.3 Compensation for Design Phase Services, as part of the Work, shall include
the Design-Builder's Fee as established in the Time and Material Costs, Exhibit
No. B, paid in proportion to the services performed, subject to adjustment as
provided in Paragraph 7.4.
7.1.4 For changes in Design Phase services, any additional compensation shall be
adjusted as indicated in the Project Development Agreement signed by the
Design-Builder and Engineer.
7.1.5 Within fifteen (15) days after receipt of each monthly application for
payment, the Owner shall give written notice to the Design-Builder of the
Owner's acceptance or rejection, in whole or in part, of such application for
payment. Within fifteen (15) days after accepting such application, the Owner
shall pay directly to the Design-Builder the appropriate amount for which
application for payment is made, less amounts previously paid by the Owner. If
such application is rejected in whole or in part, the Owner shall indicate the
13
reasons for its rejection. If the Owner and the Design-Builder cannot agree on a
revised amount then, within fifteen (15) days after its initial rejection in
part of such application, the Owner shall pay directly to the Design-Builder the
appropriate amount for those items not rejected by the Owner for which
application for payment is made, less amounts previously paid by the Owner.
Those items rejected by the Owner shall be due and payable when the reasons for
the rejection have been removed.
7.1.6 If the Owner fails to pay the Design-Builder at the time payment of any
account becomes due, then the Design-Builder may, at any time thereafter, upon
serving written notice that the Work will be stopped 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 received.
7.1.7 Payments due pursuant to Subparagraph 7.1.5, may bear interest from the
date payment is due at the prime rate prevailing at the location of Project.
7.2 CONSTRUCTION PHASE COMPENSATION
7.2.1 The Owner shall compensate the Design-Builder for work performed following
the commencement of the Construction Phase on the following basis:
.1 the Cost of the Work as allowed in Article 8; and
.2 the Design-Builder's Fee paid in proportion to the services
performed subject to adjustment as provided in Paragraph 7.4.
7.2.2 The compensation to be paid under this Paragraph 7.2 shall be limited to
the GMP established in Amendment No. 1, as the GMP may be adjusted under Article
9.
7.2.3 Payment from Construction Phase Services shall be as set forth in Article
10. If Design Phase Services continue to be provided after construction has
commenced, the Design-Builder shall continue to be compensated as provided in
Paragraph 7.1, or as mutually agreed.
7.3 DESIGN-BUILDER'S FEE The Design-Builder's Fee shall be as follows, subject
to adjustment as provided in Paragraph 7.4, Time and Material Costs per Exhibit
No. B payable each month as provided in Paragraph 7.1.5.
7.4 ADJUSTMENT IN THE DESIGN-BUILDER'S FEE Adjustment in the Design-Builder's
Fee shall be made as follows:
.1 for changes in the Work as provided in Article 9, the
Design-Builder's Fee shall be adjusted as follows: Time and Material
Costs as outlined in Exhibit No. B.
.2 for delays in the Work not caused by the Design-Builder, except as
provided in Subparagraph 6.3.2, there will be an equitable adjustment
in the Design-Builder's Fee to compensate the Design-Builder for
increased expenses; and
.3 if the Design-Builder is placed in charge of managing the
replacement of an insured or uninsured loss, the Design-Builder shall
be paid an additional fee in the same proportion that the
Design-Builder's Fee bears to the estimated Cost of the Work for the
replacement.
The Owner agrees to pay the Design-Builder for the Cost of the Work as defined
in this Article. This payment shall be in addition to the Design-Builder's Fee
stipulated in Paragraph 7.3.
ARTICLE 8 - COST OF THE WORK
8.1 COST ITEMS FOR DESIGN PHASE SERVICES
8.1.1 Compensation for Design Phase Services as provided in Paragraph 7.1.
14
8.2 COST ITEMS FOR CONSTRUCTION PHASE SERVICES
8.2.1 Time and Material Costs per Exhibit No. B include but are not limited to:
8.2.2 Wages paid for labor in the direct employ of the Design-Builder in the
performance of the Work.
8.2.3 Salaries of the Design-Builder's employees when stationed at the field
office, in whatever capacity employed and employees engaged on the road
expediting the production or transportation of material and equipment.
8.2.4 Cost of all employee benefits and taxes including but not limited to
workers' compensation, unemployment compensation, Social Security, health,
welfare, retirement and other fringe benefits as required by law, labor
agreements, or paid under the Design-Builder's standard personnel policy,
insofar as such costs are paid to employees of the Design-Builder who are
included in the Cost of the Work under Subparagraphs 8.2.1 and 8.2.2.
8.2.5 Reasonable transportation, travel, hotel and moving expenses of the
Design-Builder's personnel incurred in connection with the Work.
8.2.6 Cost of all materials, supplies and equipment incorporated in the Work,
including costs of inspection and testing if not provided by the Owner,
transportation, storage and handling.
8.2.7 Payments made by the Design-Builder to Subcontractors for work performed
under this. Agreement.
8.2.8 Fees and expenses for design services procured or furnished by the
Design-Builder except as provided by the Engineer and compensated in Paragraph
7.1.
8.2.9 Cost, including transportation and maintenance of all materials, supplies,
equipment, temporary facilities and hand tools not owned by the workers that are
used or consumed in the performance of the Work, less salvage value and/or
residual value; and cost less salvage value on such items used, but not consumed
that remain the property of the Design-Builder.
8.2.10 Rental charges of all necessary machinery and equipment, exclusive of
hand tools owned by workers, used at the Worksite, whether rented from the
Design-Builder or Others, including installation, repair and replacement,
dismantling, removal, maintenance, transportation AND delivery costs. Rental
from unrelated third parties shall be reimbursed at actual cost as indicated in
the Time and Material worksheet.
8.2.11 Cost of the premiums for all insurance and surety bonds that the
Design-Builder is required to procure or deems necessary, and approved by the
Owner.
8.2.12 Sales, use, gross receipts or other taxes, tariffs or duties related to
the Work for which the Design-Builder is liable.
8.2.13 Fees, licenses, tests, royalties, damages for infringement of patents
and/or copyrights, including costs of defending related suits for which the
Design-Builder is not responsible as set forth in Paragraph 3.7, and deposits
lost for causes other than the Design-Builder's negligence.
8.2.14 Losses, expenses or damages to the extent not compensated by insurance OR
otherwise, and the cost of corrective work and/or redesign during the
Construction Phase and for a period of one year following the Date of
Substantial Completion,, provided that such corrective work and/or redesign did
not arise from the negligence of the Design-Builder.
8.2.15 All costs associated with establishing, equipping, operating, maintaining
and demobilizing the field office.
8.2.16 Reproductions costs, photographs, cost of telegrams, facsimile
transmissions, long distance telephone calls, data processing services, postage,
express delivery charges, telephone service at the Worksite and reasonable ▇▇▇▇▇
cash expenses at the field office.
8.2.17 The premium portion of overtime work ordered by the Owner, including
productivity impact costs, other than the that required by the Design-Builder to
maintain the current Schedule of Work.
8.2.18 Out of town travel by the Engineer in connection with the Work, except
between the Engineer's office, the Design-Builder's office, the Owner's office
and the worksite as further described in the Design-Builder's separate contract
with the selected Engineer.
8.2.19 All water, power and fuel costs necessary for the Work.
8.2.20 Cost of removal of all non-hazardous substances, debris and waste
materials.
8.2.21 Costs incurred due to an emergency affecting the safety of persons and/or
property.
8.2.22 Legal, mediation and arbitration fees and costs, other than those arising
from disputes between the Owner and the Design-Builder, reasonably and properly
resulting from the Design-Builder's performance of the Work.
8.2.23 All costs directly incurred in the performance of the Work or in
connection with the Project, and not included in the Design-Builder's Fee as set
forth in Article 7, which are reasonably inferable from the Contract Documents
as necessary to produce the intended results.
15
8.3 DISCOUNTS All discounts for prompt payment shall accrue to the Owner to the
extent such payments are made directly by the Owner. To the extent payments are
made with funds of the Design-Builder, all cash discounts shall accrue to the
Design-Builder. All trade discounts, rebates and refunds, and all returns from
sale of surplus materials and equipment, shall be credited to the Cost of the
Work.
ARTICLE 9 - CHANGES IN THE WORK
Changes in the Work which are within the general scope of this Agreement may be
accomplished, without invalidating this Agreement, by Change Order, Work Change
Directive, or a minor change in the work, subject to the limitations stated in
the Contract Documents.
9.1 CHANGE ORDER
9.1.1 The Design-Builder may request and/or the Owner, without invalidating this
Agreement, may order changes in the Work within the general scope of the
contract Documents consisting of additions, deletions or other revisions to the
GMP or the estimated cost of the work, compensation for Design Phase Services,
the Design-Builder's Fee and/or the Date of Substantial Completion and/or the
Date of Final Completion being adjusted accordingly. All such changes in the
Work shall be authorized by applicable Change Order, and shall be performed
under the applicable conditions of the Contract Documents.
9.1.2 Each adjustment in the GMP and/or estimated Cost of the Work resulting
from a Change Order shall clearly separate the amount attributable to
compensation for Design Phase Services, other Cost of Work and the
Design-Builder's Fee
9.1.3 The Owner and the Design-Builder shall negotiate in good faith an
appropriate adjustment to the GMP or the estimated Cost of the Work,
compensation for Design Phase Services, the Design-Builder's Fee and/or the Date
of Substantial Completion and/or the Date of Final Completion and shall conclude
these negotiations as expeditiously as possible. Acceptance of the Change Order
and any adjustment in the GMP, the estimated Cost of the Work, compensation for
Design Phase Services, the Design-Builder's Fee and/or the Date of Substantial
Completion and/or the Date of Final Completion shall not be unreasonably
withheld.
9.2 PROPOSED CHANGE ORDERS (PCO'S)
9.2.1 The Owner may issue a written Proposed Change Orders directing a change in
the Work prior to reaching agreement with the Design-Builder on the adjustment,
if any, in the GMP, estimated Cost of the Work, the Design-Builder's Fee, the
Date of Substantial Completion and/or the Date of Final Completion, and if
appropriate, the compensation for Design Phase Services.
9.2.2 The Owner and the Design-Builder shall negotiate expeditiously and in good
faith for appropriate adjustments, as applicable, to the GMP, estimated Cost of
the Work, the Design-Builder's Fee, the Date of Substantial Completion and/or
the Date of Final Completion, and if appropriate the compensation for Design
Phase services, arising out of Proposed Change Orders. As the changed work is
completed, the Design-Builder shall submit its costs for such work with its
application for payment beginning with the next application for payment within
thirty (30) days of the issuance of the proposed change Orders Pending final
determination of cost to the Owner, amounts not in dispute may be included in
applications for payment and shall be paid by Owner.
9.2.3 If the Owner and the Design-Builder agree upon the adjustments in the GMP,
estimated Cost of the Work, the Design-Builder's Fee, the Date of Substantial
Completion and/or the Date of Final Completion, and if appropriate the
compensation for Design Phase Services, for a change in the Work directed by a
Proposed Change Order, such agreement shall be the subject of an appropriate
Change Order. The Change Order shall include all outstanding PCO's issued since
the last Change Order.
9.3 MINOR CHANGES IN THE WORK
9.3.1 The Design-Builder may make minor changes in the design and construction
of the Project consistent with the intent of the Contract Documents which do not
involve an adjustment in the GMP, estimated Cost of the Work, the
Design-Builder's Fee, the Date of Substantial Completion and/or the Date of
Final Completion, and do not materially and adversely affect the design of the
Project, the quality of _______________________________________________________
equipment or systems specified in the Contract Documents, or the quality of
workmanship required by the Contract Documents.
16
9.3.2 The Design-Builder shall promptly inform the Owner in writing of any such
changes and shall record such changes on the Design-Build Documents maintained
by the Design-Builder.
9.4 UNKNOWN CONDITIONS If in the performance of the Work the Design-Builder
finds latent, concealed or subsurface physical conditions which materially
differ from the conditions the Design-Builder reasonably anticipated, or if
physical conditions are materially different from those normally encountered and
generally recognized as inherent in the kind of work provided for in this
Agreement, then the GMP, estimated Cost of the Work, the Design-Builder's Fee,
the Date of Substantial Completion and/or the Date of Final Completion, and if
appropriate the compensation for Design Phase Services, shall be equitably
adjusted by Change Order within a reasonable time after the conditions are first
observed. The Design-Builder shall provide the Owner with written notice within
the time period set forth in Paragraph 9.6,
9.5 DETERMINATION OF COST
9.5.1 An increase Or decrease in the GMP and/or estimated Cost of the Work
resulting from a change in the Work shall be determined be Time and Material
Costs per Exhibit No. B as defined in Paragraph 7.2, Article 8 and subparagraph
7.4.1.
9.5.2 If the Owner and the Design-Builder disagree as to whether work required
by the Owner is within the scope of the Work, the Design-Builder shall furnish
the Owner with an estimate of the costs to perform the disputed work in
accordance with the Owner's interpretations. If the Owner issues a written order
for the Design-Builder to proceed, the Design-Builder shall perform the disputed
work and the Owner shall pay the Design-Builder fifty percent (50%) of its
estimated cost to perform the work. in such event, both parties reserve their
rights as to whether the work was within the scope of the Work. The Owner's
payment does not prejudice its right to be reimbursed should it be determined
that the disputed work was within the scope of work. The Design-Builder's
receipt of payment for the disputed work does not prejudice its right to
receive full payment for the disputed work should it be determined that the
disputed work is not within the scope of the Work.
9.6 EMERGENCIES In any emergency affecting the safety of persons and/or
property, the Design-Builder shall act, at its discretion, to prevent threatened
damage, injury or loss. Any change in the GMP, estimated Cost of the Work, the
Design-Builder's Fee, the Date of Substantial Completion and/or the Date of
Final Completion, and if appropriate compensation for Design Phase Services, on
account of emergency work shall be determined as provided in this Article.
9.7 CHANGES IN LAW In the event any changes in laws or regulations affecting the
performance of the Work are enacted after either the date of this Agreement or
the date a GMP Proposal is accepted by the Owner and set forth in Amendment No.
1 to this Agreement, whichever occurs later, the GMP, estimated Cost of the
Work,, the Design-Builder's Fee, the Date of Substantial Completion and/or the
Date of Final Completion, and if appropriate the compensation for Design Phase
Services, shall be equitably adjusted by Change Order.
ARTICLE 10 - PAYMENT FOR CONSTRUCTION PHASE SERVICES
10.1 PROGRESS PAYMENTS
10.1.1 On the 5th day of each month after the Construction Phase has commenced,
the Design-Builder shall submit to the Owner an application for payment
consisting of the Cost of the Work performed up to the end of the month,
including the cost of material suitably stored on the Worksite or at other
locations approved by the Owner, along with a proportionate share of the
Design-Builder's Fee. Approval of payment applications for such stored materials
shall be conditioned upon submission by the Design-Builder of bills of sale and
applicable insurance or such other procedures satisfactory to the Owner to
establish the Owner's title to such materials, or otherwise to protect the
Owner's interest, including transportation to the site. Prior to submission of
the next application for payment, the Design-Builder shall furnish to the Owner
a statement accounting for the disbursement of funds received under the previous
application. The extent of such statement shall be as agreed upon between the
Owner and the Design-Builder.
17
10.1.2 Within ten (10) days after receipt of each monthly application for
payment, the Owner shall give written notice to the Design-Builder of the
Owner's acceptance or rejection, in whole or in part, of such application for
payment. Within fifteen (15) days after accepting such application, the Owner
shall pay directly to the Design-Builder the appropriate amount for which
application for payment is made, less amounts previously paid by the Owner. If
such application is rejected in whole or in part, the Owner shall indicate the
reasons for its rejection. If the Owner and the Design-Builder cannot agree on a
revised amount then, within fifteen (15) days after its initial rejection in
part of such application, the Owner shall pay directly to the Design-Builder the
appropriate amount for those items not rejected by the Owner for which
application for payment is made, less amounts previously paid by the Owner.
Those items rejected by the Owner shall be due and payable when the reasons for
the rejection have been removed.
101.3 If the Owner fails to pay the Design-Builder at the time payment of any
amount becomes due, then the Design-Builder may, at any time thereafter, upon
serving written notice that the Work will be stopped within seven (7) days after
receipt of the notice by the Owner, and after such seven day period, stop the
Work until payment of the amount owing has been received.
10.1.4 Payments due but unpaid pursuant to Subparagraph 10.1.2, less any amount
retained pursuant to Paragraphs 10.2 and 10.3 may bear interest from the date
payment is due at the prime rate prevailing at the place of the Project.
10.1.5 The Design-Builder warrants and guarantees that a conditional release of
all Work, materials and equipment covered by a dated application for payment
will pass to the Owner upon submission. Upon receipt of such like payment to the
Design-Builder, an unconditional release of all liens, claims, security
interests or encumbrances will be provided.
10.1.6 The Owner's progress payment, occupancy or use of the Project, whether in
whole or in part, shall not be deemed an acceptance or any Work not conforming
to the requirements of the Contract Documents.
10.1.7 Upon Substantial Completion of the Work, the Owner shall pay the
Design-Builder the unpaid balance of the Cost of the Work, compensation for
Design Phase Services and the Design-Builder's Fee, less one-hundred-fifty
percent (150%) of the cost of completing any unfinished items as agreed to
between the Owner and the Design-Builder as to extent and time for completion.
The Owner thereafter shall pay the Design-Builder monthly the amount retained
for unfinished items as each item is completed.
10.2 RETAINAGE From each progress estimate made prior to the time Substantial
Completion of the Work has been reached, the Owner shall retain five percent
(5%), if required, of the amount otherwise due after deduction of any amounts as
provided in Paragraph 10.3 of this Agreement. If the Owner chooses to use this
retainage provision:
.1 at the time the Work is fifty percent (50%) complete and thereafter,
the Owner may choose to withhold no more retainage and pay the
Design-Builder the full amount of what is due on account of subsequent
progress payments;
.2 once each early finishing trade Subcontractor has completed its work
and that work has been accepted by the Owner, the Owner may release
final retention on such work;
.3 The Design-Builder may establish an escrow account for all retention
and any interest on such securities shall accrue to the Design-Builder;
.4 the Owner may, in its sole discretion, reduce the amount to be
retained at any time.
10.3 ADJUSTMENT OF DESIGN-BUILDER'S APPLICATION FOR PAYMENT The Owner may adjust
or reject an application for payment or nullify a previously approved
Design-Builder application for payment, in whole or in part, as my reasonably be
necessary to protect the Owner from loss or damage based upon the following, to
the extent that the Design-Builder is responsible under this Agreement:
.1 the Design-Builder's repeated failure to perform the Work as
required by the Contract Documents;
.2 loss or damage arising out of or relating to this Agreement and
caused by the Design-Builder to the Owner or
______________________________.
18
.3 the Design-Builder's failure to properly pay the Engineer,
Subcontractors or Material Suppliers for labor, materials, equipment or
supplies furnished in connection with the Work, provided that the Owner
is making payments to the Design-Builder in accordance with the terms
of this Agreement;
.4 Defective Work not corrected in a timely fashion;
.5 reasonable evidence of delay in performance of the Work such that
the Work will not be completed by the Date of Substantial Completion
and/or the Date of Final Completion, and that the unpaid balance of the
GMP is. not sufficient to offset any direct damages that may be
sustained by the Owner as a result of the anticipated delay caused by
the Design-Builder; and
.6 reasonable evidence demonstrating that the unpaid balance of the GMP
is insufficient to fund the cost to complete the Work.
The Owner shall give written notice to the Design-Builder at the time of
disapproving or nullifying all or part of an application for payment of the
specific reasons. When the above reasons for disapproving or nullifying an
application for payment are removed, payment will be made for the amount
previously withheld.
10.4 OWNER OCCUPANCY OR USE OF COMPLETED OR PARTIALLY COMPLETED WORK
10.4.1 Portions of the Work that are completed or partially completed may be
used or occupied by the Owner when (a) the portion of the Work is designated in
a Certificate of Substantial Completion, (b) appropriate Insurer(s) and/or
sureties consent to the occupancy or use, and (c) appropriate public authorities
authorize the occupancy or use. Such partial occupancy or use shall constitute
Substantial Completion of that portion of the Work. The Design-Builder shall not
unreasonably withhold consent to partial occupancy or use, provided such partial
occupancy or use is of value to the Owner.
10.5 FINAL PAYMENT
10.5.1 Final Payment, consisting of the unpaid ,balance of the Cost of the Work,
compensation for Design Phase Services and the Design-Builder's Fee, shall be
due and payable when the work is fully completed. before issuance of final
payment, the Owner may request satisfactory evidence that all payrolls, material
bills and other indebtedness connected with the Work have been paid or otherwise
satisfied.
10.5.2 IN making final payment the Owner waives all claims except for:
.1 outstanding liens;
.2 improper workmanship or defective materials appearing within one
year after the date of Substantial Completion;
.3 work not in conformance with the Contract Documents; and
.4 terms of any special warranties required by the Contract Documents.
10.5.3 in accepting final payment, the Design-Builder waives all claims except
those previously made in writing and which remain unsettled.
ARTICLE 11 - INDEMNITY, INSURANCE, BONDS, AND WAIVER OF SUBROGRATION
11.1 INDEMNITY
11.1.1 To the fullest extent permitted by law, the Design-Builder shall defend,
indemnify and hold harmless the Owner, Owner's officers, directors, members,
consultants, agents and employees from all claims for bodily injury and property
damage (other than to the Work itself and other property required to be insured
under Paragraph 11.5 owned by or in the custody of the owner), that may arise
from the performance of the Work, to the extent of the negligence attributed to
such acts or omissions by the Design-Builder, Subcontractors or anyone employed
directly or indirectly by any of them or by anyone for whose acts any of them
19
may be liable. The Design-Builder shall not be required to defend, indemnify or
hold harmless the Owner, Owner's officers, directors, members, consultants,
agents and employees for any acts, omissions or negligence of the Owner, the
Owner's officers, directors, members, consultants, employees, agents or separate
contractors.
11.1.2 To the fullest extent permitted by law, the Owner shall defend, indemnify
and hold harmless the Design-Builder, its officers, directors or members,
Subcontractors or anyone employed directly or indirectly by any of them or
anyone for whose acts any of them may be liable from all claims for bodily
injury and property damage, other than property insured under Paragraph 11.5,
that may arise from the performance of work by Others, to the extent of the
negligence attributed to such acts or omissions by Others.
11.2 DESIGN-BUIDER'S LIABILITY INSURANCE
11.2.1 The Design-Builder shall obtain and maintain insurance coverage for the
following claims which may arise out of the performance of this Agreement,
whether resulting from the Design-Builder's operations or form the operations of
any Subcontractor, anyone in the employ of any of them, or by an individual or
entity for whose acts they may be liable:
.1 workers' compensation, disability and other employee benefit claims
under acts applicable to the Work;
.2 under applicable employer's liability law, bodily injury,
occupational sickness, disease or death claims of the Design-Builder's
employees;
.3 personal injury liability claims for damages directly or indirectly
related to the person's employment by the Design-Builder or for damages
to any other person;
.4 claims for physical injury to tangible property, including all
resulting loss of use of that property, to property other than the Work
itself and property insured under Paragraph 11.5;
.5 bodily injury, death or property damage claims resulting from
motor vehicle liability in the use, maintenance or ownership of any
motor vehicle; and
.6 contractual liability claims involving the Design-Builder's
obligations under Subparagraph 11.1.1.
11.2.2 The Design-Builder's Commercial General and Automobile Liability
Insurance as required by Subparagraph 11.2.1 shall be written for not less than
the following limits of liability:
.1 Commercial General Liability Insurance
a. Each Occurrence Limit $ 1,000,000
-----------------
b. General Aggregate $ 2,000,000
-----------------
c. Products/Completed
Operations Aggregate $ 1,000,000
-----------------
d. Personal and Advertising
injury Limit $ 1,000,000
-----------------
.2 Comprehensive Automobile Liability Insurance
a. Combined Single Limit Bodily
Injury and Property Damage $ 1,000,000
-----------------
Each Occurrence
11.2.3 Commercial General Liability Insurance may be arranged under a single
policy for the full limits required or by a combination of underlying policies
and an Excess or Umbrella Liability policy.
20
11.2.4 The policies shall contain a provision that coverage will not be canceled
or not renewed until at least thirty (30) days' notice has been given to the
Owner. Certificates of insurance showing required coverage to be in force shall
be filed with the Owner prior to commencement of the Work.
11.2.5 Umbrella Liability insurance shall protect the parties against claims
excess of the limits provided under the worker's compensations liability,
commercial general liability and automotive liability.
.1 Commercial General Liability Insurance
a. Umbrella Excess $ 10,000,000
-----------------
Each Occurrence
On Policies under Clauses 11.2, each party shall list the other parties and
Owner as an additional insured, and such policies shall be primary over any
other insurance carried by the additional insured's.
11.2.6 Products and Completed Operations insurance shall be maintained for a
minimum period of at least 5 year(s) after final payment.
11.3 PROFESSIONAL LIABILITY INSURANCE The Engineer shall obtain professional
liability insurance for claims arising from the negligent performance of
professional services under this Agreement, which shall be Project Specific
Professional Liability Insurance written for not less than the per
claim/aggregate with a deductible not to exceed those amounts listed in the
Agreement between the Design-Builder and the Engineer. The Professional
Liability Insurance shall include prior acts coverage sufficient to cover all
services rendered by the Engineer. This coverage shall be continued in effect
for 5 year(s) after the Date of Substantial Completion.
11.4 OWNER'S LIABILITY INSURANCE The Owner shall be responsible for obtaining
and maintaining its own liability insurance. Insurance for claims arising out of
the performance of this Agreement may be purchased and maintained at the Owner's
discretion. The Owner shall provide the Design-Builder with a certificate of
insurance at the request of the Design-Builder.
11.5. INSURANCE TO PROTECT PROJECT
11.5.1 The Design-Builder shall obtain and maintain "All Risk" Builder's Risk
Insurance in a form acceptable to the Owner upon the entire Project for the full
cost of replacement at the time of any loss. This insurance shall include as
named insured the Owner, the Engineer, Subcontractors, Material Suppliers and
Sub-subcontractors. This insurance shall include "all risk" insurance for
physical loss or damage including without duplication of coverage at least:(.)
theft, vandalism, malicious mischief, transit, materials stored off site,
collapse, false-work, temporary buildings, debris removal, flood, earthquake,
workmanship or material. If requested by the Owner, the Design-Builder shall
obtain a Builder's Risk start-up and testing policy that covers plant operations
for a stated period of time. The design-Builder shall increase limits of
coverage, if necessary, to reflect estimated replacement cost. The insurance
policy shall be written without a co-insurance clause. The Design-Builder and
Owner shall share the responsibility for any deductible amounts at a 50/50 rate.
11.5.2 If the Owner occupies or uses a portion of the project prior to its
substantial completion, such occupancy or use shall not commence prior to a time
mutually agreed to by the Owner and the Design-Builder. Permission for partial
occupancy from the insurance company shall be included as standard in the
property insurance policy, to ensure that this insurance shall not be canceled
or lapsed on account of partial occupancy. Consent of the Design-Builder to such
early occupancy or use shall not be unreasonably withheld.
11.5.3 If necessary and at the Owner's expense, the Owner shall purchase and
maintain insurance to protect the Owner, the Design-Builder, the Engineer,
Subcontractors, and Sub-subcontractors against loss of use of the Owner's
property due to those perils insured pursuant to Paragraph 11.5. Such policy
will provide coverage for expediting expenses of materials, continuing overhead
of the Owner and the Design-Builder, the Engineer, Subcontractors, Material
Suppliers and Sub-subcontractors, necessary labor expense including overtime,
loss of income by the Owner and other determined exposures. Exposures of the
Owner, the Design-Builder, the Engineer, Subcontractors and Sub-subcontractors,
shall be determined by mutual agreement with separate limits of coverage fixed
for each item.
21
11.5.4 The Owner and Design-Builder shall provide each other with copies of all
insurance policies before an exposure to loss may occur. Copies of any
subsequent endorsements shall be furnished as necessary. The cost of any
insurance shall be added to the Cost of the Work pursuant to Article 8, and the
GMP shall be increased by Change Order.
11.6 PROPERTY INSURANCE LOSS ADJUSTMENT
11.6.1 Any insured loss shall be adjusted with the Owner and the Design-Builder
and made payable to the Owner and Design-Builder as trustees for the insured,
as their interests may appear, subject to any applicable mortgage clause.
11.7 WAIVER OF SUBROGRATION
11.7.1 The Owner and the Design-Builder waive all rights against each other, the
Engineer, and any of their respective employees, agents, consultants,
Subcontractors and Sub-subcontractors for damages covered by the insurance
provided pursuant to Paragraph 11.5 to the extent they are covered by that
insurance, except such rights as they may have to the proceeds of such insurance
held by the Owner and the Design-Builder as trustees. The Design-Builder shall
require similar waivers from the Engineer and all Subcontractors, and shall
require each of them to include similar waivers in their sub-subcontracts and
consulting agreements.
11.7.2 The Owner waives subrogation against the Design-Builder, the Engineer,
Subcontractors and Sub-subcontractors on all property and consequential loss
policies carried by the Owner on adjacent properties and under property and
consequential loss policies purchased for the Project after its completion.
11.7.3 All policies except worker's compensation shall be endorsed to state that
the carrier waives any right to subrogation against the Design-Builder, the
Engineer, Subcontractors or Sub-subcontractors.
11.8 MUTUAL WAIVER OF CONSEQUENTIAL DAMAGES The Owner and the Design-builder
agree to waive all claims against the other for all consequential damages that
may arise out of or relate to this Agreement. The Owner agrees to waive damages
including but not limited to the Owner's loss of use of the Property, all rental
expenses incurred, loss of services of employees, or loss of reputation. The
Design-Builder agrees to waive damages including but not limited to the loss of
business, loss of financing, principle office. overhead and profits, loss of
profits not related to this Project, or loss of reputation. This paragraph shall
not be construed to preclude contractual provisions for liquidated damages when
such provisions relate to direct damages only. , The provisions of this
paragraph shall govern the termination of this Agreement and shall survive such
termination.
11.9 BONDING
11.9.1 Performance and Payment Bonds may be required of the Design-Builder by
Owner. Such bonds shall be issued by a surety licensed in the state of the
location of the Project and must. be acceptable to the Owner.
11.9.2 Such Performance Bond shall be issued in the penal sum up to one-hundred
percent (100%) of the GMP per the signed Amendment No. 1 as determined by the
Owner. Such Performance Bond shall cover the cost to complete the Work, but
shall not cover any damages of the type specified to be covered by the insurance
pursuant to Paragraph 11.2 and Paragraph 11.3, whether or not such insurance is
provided or is in an amount sufficient to cover such damages.
11.9.3 The penal sum of the Payment Bond may or may not be equal the penal sum
of the Performance Bond as determined by the Owner.
22
ARTICLE 12 -- SUSPENSION TERMINATION OF THE AGREEMENT AND OWNER'S RIGHT TO
PERFORM DESIGN-BUILDER'S RESPONSIBILITIES
12.1 SUSPENSION BY THE OWNER FOR CONVENIENCE
12.1.1 The Owner may order the Design-Builder in writing to suspend, delay or
interrupt all or any part of the Work without cause for such period of time as
the Owner may determine to be appropriate for its convenience.
12.1.2 Adjustments caused by suspension, delay or interruption shall be made for
increases in the GMP, compensation for Design Phase Services, the
Design-Builder's Fee and/or the Date of Substantial Completion and/or the Date
of Final Completion. No adjustment shall be made if the Design-Builder is or
otherwise would have been responsible for the suspension, delay or interruption
of the work, or if another provision of this Agreement is applied to render an
equitable adjustment.
12.2 TERMINATION BY OWNER If the Owner terminates this Agreement, the Owner
shall pay the Design-Builder for all costs associated with the Work per the
signed and dated ▇▇▇▇▇ Diversified Agreement Titled "Summary of Terms for
Secured Debt With Equity." In addition, the Design-Builder shall be paid an
amount calculated as set forth below:
.1 If the Owner terminates this Agreement after commencement of the
Construction Phase, as determined by the signed and dated ▇▇▇▇▇
Diversified Agreement Titled "Summary of Terms for Secured Debt With
Equity," the Design-Builder shall be paid for the Construction Phase
Services provided to date pursuant to Subparagraph 7.2.1 and a premium
as set forth below:
All Overhead and Profit per the GMP plus fifty (50)-percent of
the realized savings in the Design-Builder's projected contingency.
.2 The Owner shall also pay to the Design-Builder fair compensation,
either by purchase or rental at the election of the Owner, for all
equipment retained. The Owner shall assume and become liable for
obligations, commitments and unsettled claims that the Design-Builder
has previously undertaken or incurred in good faith in connection with
the Work or as a result of the termination of this Agreement As a
condition of receiving the payments provided under this Article 12, the
Design-Builder shall cooperate with the owner by taking all steps
necessary to accomplish the legal assignment of the Design-Builders
rights and benefits to the Owner, including the execution and delivery
of required papers.
12:3 TERMINATION BY THE DESIGN-BUILDER
12.3.1 Upon five (5) days' written notice to the Owner, the Design-Builder may
terminate this Agreement for any of the following reasons:
.1 if the Work has been stopped for a sixty (60) day period
a. under court order or order of other governmental
authorities having jurisdiction; or
b. as a result of the declaration of a national emergency or
other governmental act during which, through no act or fault
of the Design-Builder, materials are not available;
.2 if the Work is suspended by the Owner for sixty (60) consecutive
days;
.3 if the Owner fails to furnish reasonable evidence that sufficient
funds are available and committed for the entire cost of the Project in
accordance with Subparagraph 4.1.3 of this Agreement.
12.3.2 If the Owner has for thirty (30) days failed to pay the Design-Builder
pursuant to Subparagraph 10.1.2, the Design-Builder may give written notice of
its intent to terminate this Agreement. If the Design-Builder does not receive
payment within five (5) days of giving written notice to the Owner, then upon
five (5) days' additional written notice to the Owner, the Design-Builder may
terminate this Agreement
12.3.3 Upon termination by the Design-Builder in accordance with this
Subparagraph, the Design-Builder shall be entitled to recover from the Owner
payment for all Work executed and for all proven loss, cost or expense in
23
connection with the Work, plus all demobilization costs and reasonable damages.
In addition, the Design-Builder shall be paid an amount calculated as set forth
either in Subparagraph 12.2.1 or 12.2.2, depending on when the termination
occurs.
ARTICLE 13 - DISPUTE RESOLUTION
13.1 WORK CONTINUANCE AND PAYMENT Unless otherwise agreed in writing, the
Design-Builder shall continue the Work and maintain the approved schedules
during all dispute resolution proceedings. If the Design-Builder continues to
perform, the Owner shall continue to make payments in accordance with the
Agreement.
13.2 INITIAL DISPUTE RESOLUTION If a dispute arises out of or relates to this
Agreement or its breach, the parties shall endeavor to settle the dispute first
through direct discussions. If the dispute. cannot be settled through direct
discussions, the parties shall endeavor to settle the dispute by mediation under
the Construction Industry Mediation Rules of the American Arbitration
Association before recourse to the dispute resolution procedures contained in
this Agreement. The location of the mediation shall be the location of the
Project. Once one party files a request for mediation with the other contracting
party and with the American Arbitration Association, the parties agree to
conclude such mediation within sixty (60) days of filing of the request. Either
party may terminate the mediation at any time after the first session, but the
decision to terminate must be delivered in person by the party's representative
to the other party's representative and the mediator.
13.3 EXHIBIT NO. A if the dispute cannot be settled by mediation within sixty
(60) days, the parties shall submit the dispute to any dispute resolution
process set forth in Exhibit No. A to this Agreement.
13.4 MULTIPARTY PROCEEDING The parties agree that all parties necessary to
resolve a claim shall be parties to the same dispute resolution proceeding.
Appropriate provisions shall be included in all other contracts relating to the
Work to provide for the consolidation of such dispute resolution proceedings.
13.5 COST OF DISPUTE RESOLUTION The prevailing party in any dispute arising out
of or relating to this Agreement or its breach that is resolved by the dispute
resolution process set forth in Exhibit No. A to this Agreement shall be
entitled to recover from the other party those reasonable attorneys fees, costs
and expenses incurred by the prevailing party in connection with such dispute
resolution process after direct discussions and mediation.
13.6 LIEN RIGHTS Nothing in this Article shall limit any rights or remedies not
expressly waived by the Design-Builder which the Design-Builder may have under
lien laws.
ARTICLE 14 - MISCELLANEOUS PROVISIONS
14.1 ASSIGNMENT Neither the Owner nor the Design-Builder shall assign its
interest in this Agreement without the written consent of the other except as to
the assignment of proceeds. The terms and conditions of this Agreement shall be
binding upon both parties, their partners, successors, assigns and legal
representatives. Neither party to this Agreement shall assign the Agreement as a
whole without written consent of the other except that the Owner may assign the
Agreement to a wholly-owned subsidiary of the Owner when the Owner has fully
indemnified the Design-Builder or to an institutional lender providing
construction financing for the Project as long as the assignment is no less
favorable to the Design-Builder than this Agreement. In the event of such
assignment, the Design-Builder shall execute all consents reasonably required.
in such event, the wholly-owned subsidiary or lender shall assume the Owner's
rights and obligations under the Contract Documents. If either party attempts to
make such an assignment, that party shall nevertheless remain legally
responsible for all obligations under the Agreement, unless otherwise agreed by
the other party.
14.2 GOVERNING LAW This Agreement shall be governed by the law in effect at the
location of the Project.
14.3 SEVERABILITY The partial or complete invalidity of any one or more
provisions of this Agreement shall not affect the validity or continuing force
and effect of any other provision.
24
14.4 NO WAIVER OR PERFORMANCE The failure of either party to insist, in any one
or more instances, on the performance of any of the terms, covenants or
conditions of this Agreement, or to exercise any of its rights, shall not be
construed as a waiver or relinquishment of such term, covenant, condition or
right with respect to further performance.
14.5 TITLES AND GROUPINGS The titles given to the articles of this Agreement are
for ease of reference only and shall not be relied upon or cited for any other
purpose. The grouping of the articles in this Agreement and of the Owners
specifications under the various headings is solely for the purpose of
convenient organization and in no event shall the grouping of provisions, the
use of paragraphs or the use of headings be construed to limit or alter the
meaning of any provisions.
14.6 JOINT DRAFTING The parties to this Agreement expressly agree that this
Agreement was jointly drafted, and that both had opportunity to negotiate its
terms and to obtain the assistance of counsel in reviewing its terms prior to
execution. Therefore, this Agreement shall be construed neither against nor in
favor of either party, but shall be construed in a neutral manner.
14.7 RIGHTS AND REMEDIES The parties' rights, liabilities, responsibilities and
remedies with respect to this Agreement, whether in contract, tort, negligence
or otherwise, shall be exclusively those expressly set forth in this Agreement.
14.8 OTHER PROVISIONS
None
ARTICLE 15 -. OTHER DOCUMENTS
As defined in Subparagraph 2.4.1, the following Exhibits are a part of this
Agreement:
EXHIBIT NO. A Dispute Resolution Procedure
EXHIBIT NO. B Time and Material Costs worksheet.
EXHIBIT NO. C Project Development Agreement between the Design-Builder and the
Engineer
25
THIS AGREEMENT IS ENTERED INTO AS OF THE DATE ENTERED IN ARTICLE 1
AND BY THE AUTHORIZED INDIVIDUALS FOR THE COMPANIES LISTED BELOW.
OWNER:
PACIFIC ETHANOL, INC.
BY: /S/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ BY: /S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------- -------------------------------
PRINT NAME: ▇▇▇▇ ▇. ▇▇▇▇▇▇ PRINT NAME: ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------- ------------------------
PRINT TITLE: COO PRINT TITLE: Chairman of the Board
--------------------- -----------------------
ATTEST: N/A
-------------------------
DESIGN-BUILDER:
▇.▇. ▇▇▇▇▇ CO.
BY: /S/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ BY: /S/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------- -------------------------------
PRINT NAME: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ PRINT NAME: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------- ------------------------
PRINT TITLE: Vice President PRINT TITLE: Assistant Secretary
--------------------- -----------------------
ATTEST: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------
Notary Public
[▇▇▇▇▇▇ ▇. ▇▇▇▇▇
COMM. #1380830
NOTARY PUBLIC - CALIFORNIA
FRESNO COUNTY]
26
EXHIBIT A,
----------
DISPUTE RESOLUTION PROCEDURE
1. This Agreement shall be construed under the laws of the State of California.
In the event of any dispute between the parties related to this Agreement, the
parties agree to binding arbitration. Arbitration shall be conducted as follows:
2. In the event of a dispute involving the Owner, the Design-Builder, and one or
more Contractors, Subcontractors, Suppliers, or Engineers, the claims and
disputes of all parties shall be heard by the same arbitrator(s) in a single
proceeding. If the Design-Builder's claim is derived from an act or omission of
the Owner, the Supplier shall prepare and present Supplier's claim through the
Buyer at Supplier's expense.
3. Owner and Design-Builder shall be bound by the result of any arbitration with
others regarding matters relating to this Agreement. However, Owner shall only
Inbound so long as (1) Design-Builder's claim relates to the work of Owner and
(2) any recovery by Design-Builder would be payable in whole or part to Owner.
4. The Owner waives the right to ▇▇▇ the Design-Builder's payment, performance,
contractor's license, or other bonding company or surety in a court of law.
Instead, Design-Builder and Owner agree that any claim against sureties shall be
resolved by arbitration as provided in this Agreement. The parties understand
and expressly waive their right to a trial by jury, their right to a motion for
new trial, and their right to appeal. The parties mutually intend by this
provision to prevent a multiplicity of actions and the possibility of
inconsistent results from different forums.
5. In the event a dispute arises that involves only Design-Builder and Owner, or
their respective agents, employees, or sureties, the parties agree to binding
arbitration. The arbitration shall be conducted as follows:
(a) In the event of any dispute related to this Agreement, the parties agree to
binding arbitration. Arbitration shall be commenced by mailing or delivering a
written demand for arbitration by either party upon the other.
(b) Within thirty (30) days of a written demand for arbitration, each party
shall appoint an arbitrator and give written notice to the other party of such
appointment.
(c) The two (2) arbitrators so appointed shall, within fourteen (14) days,
appoint a third arbitrator who shall serve as the Chairman oft' arbitral
tribunal.
(d) If either party fails to appoint an arbitrator within thirty (30) days of
notice of a demand for arbitration, the arbitrator shall be appointed by the
Superior Court of Fresno County, California.
(e) If the two (2) arbitrators appointed fail to agree on a third arbitrator
within fourteen (14) days following appointment of the second arbitrator, the
third arbitrator shall be appointed by the Superior Court of Fresno County,
California.
(f) If an arbitrator fails or is unable to act, his successor will be appointed
in the same manner as the arbitrator he succeeds.
(g) Unless otherwise agreed by the arbitral tribunal and the parties, the rules
and procedures that will be followed in the arbitration will be the then current
Construction Industry Arbitration Rules of the American Arbitration Association.
The American Arbitration Association shall administer the dispute through its
Submitted Claims process. Each party . agrees to pay its share of fees and
expense timely, so as to not delay the arbitration.
6. The intent of the parties is to resolve all disputes in one forum, whether it
be a multi-party arbitration governed by the Prime Contract arbitration
provisions or a two-party arbitration governed by this Agreement.
7. The prevailing party in any arbitration or other legal proceeding regarding
any dispute related to this Agreement shall be entitled to recover its
reasonable costs, expenses, expert consultant fees, arbitrators' fees,
arbitration costs and expenses, and attorney fees. Unless otherwise agreed by
the parties, the arbitration shall take place in Fresno, California. This
agreement to arbitrate shall be specifically enforceable under the laws of
California. The award rendered by the arbitrators shall be final. Judgment may
be entered upon the award in any court of competent jurisdiction.
8. Work Continuation and Payment. Unless-otherwise agreed in writing,
Design-Builder shall carry on the work and maintain the schedule and/or work
pending arbitration, and, if so, Owner shall continue to make payments in
accordance with this Agreement.
A-1
EXHIBIT B
---------
▇. ▇. ▇▇▇▇▇ CO.
P. O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
JULY X, 2003
PACIFIC ETHANOL:
▇.▇. ▇▇▇▇▇ Co. is pleased to provide our Standard Cost-Plus Rates in response to
your request for information on the Ethanol Project. We are proud to be an
integral part of the construction profession since our founding in 1945. We
consider the professional relationships that we have developed over the years
stronger than that of our competitors. The rates listed below and our field
labor rates are based on current labor agreements and are effective until June
30, 2004 as follows:
1. Field Labor: According to project payroll records
Craftsmen will be paid in accordance with the union
contracts that are applicable at the time the work is
performed or special rates that are paid to certain
employees due to their experience and special
qualifications. PLEASE SEE SAMPLE ATTACHED RATES.
2. Supervision Labor: According to project payroll records
Management, Senior Engineer, Project Engineer,
Superintendent, Engineer and Project Clerks/Engineer
Intern rates will be according to our established rates
in effect at the time the work is performed. PLEASE SEE
SAMPLE ATTACHED RATES.
3. Insurance and Taxes: 35% of Field Labor, Item No. 1.
4. Tool Expense: 6% of Field Labor, Item No. 1.
5. Welfare and Pension Fund: As required by Union Agreement.
6. Subsistence: As required by Union Agreement.
7. Equipment: As per our established Cost-Plus rates.
(Please see sample attached rates.)
8. Materials and Subcontract: According to Suppliers' and
Subcontractors' Bills.
9. Home Office Overhead: 15% of Items I through 7 and 5% of Item
No. 8
10. Profit: 25% of Items I through 7.
11. Ownership Credit: 5% of Items 9 and 10.
Supervision Labor includes vehicle allowance. All other Field pickups and gang
trucks are charged to this project the same hours as the crew. All Equipment
will be charged a minimum of four hours per day.
We appreciate you placing this schedule on file. Should any further changes be
made, we will attempt to notify you as they occur. However; all percentages,
labor rates, and equipment rates are subject to change without notice.
▇.▇. ▇▇▇▇▇ Co. welcomes the opportunity to provide quality construction services
at competitive rates. Please contact us whenever we can be of service to assist
you in your construction plans.
B-1
▇.▇. ▇▇▇▇▇ CO.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
SAMPLE LABOR RATES RATE PER FRINGES PER
HOUR (#1) HOUR (#5)
THROUGH 6130/04 THROUGH 6130/04
#1 FIELD LABOR
Fitters AND Welders:
Fitter ▇▇▇▇▇▇▇ $ 33.69 $ 13.96
Fitter - Industrial $ 28.79 $ 13.96
Welder - Industrial $ 32.00 $ 13.96
5th Period Apprentice $ 18.71 $ 10.56
Pipe Tradesmen (Helper) $ 12.00 $ 6.22
OPERATING ENGINEERS:
Loader Operator (2 Yds. to 4 Yds.) $ 33.14 $ 11.95
Trencher Operator (Tr. Op.) $ 31.87 $ 11.95
Backhoe Operator (314 Yd. max) $ 33.I4 $ 11.95
Laborers:
"A" ▇▇▇▇▇▇▇ Rate $ 33.69 $ 7.92
▇▇▇▇▇▇▇ $ 27.43 $ 7.92
Leadman $ 23.89 $ 7.92
Pipe Layers $ 23.92 $ 7.92
Laborer $ 23.67 $ 7.92
#2 SAMPLE SUPERVISION RATES HOURLY
(INCLUDES VEHICLE) RATE
Management 100.00
Senior Project Engineer $ 85.00
Project Engineer $ 70.00
Superintendent $ 65.00
Engineer 60.00
ENGINEER INTERN/PROJECT CLERKS $ 25.00
#7 SAMPLE EQUIPMENT RATES
HOURLY EQUIP.
EQUIPMENT DESCRIPTION RATE Number
Boom Truck $ $5.00 ▇▇-▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ gal $ 26.50 BW-18
AIR COMPRESSOR 185 CFM $ 14.50 CD-100
Excavator, Cat 330 BL $ 108.00 FA-20
GANG TRUCK, 1 TON . $ 12.00 GA-148
GANG Truck, 2 Ton $ 13.50 GD-31
COMPACTOR, ▇▇▇▇▇▇ $ 13.50 ▇▇-▇▇
▇/▇ ▇▇▇ ▇▇▇▇▇ Pickup $ 11.00 PB-198
Reachlift $ 31.00 RF-12
Backhoe, Cat 446 $ 41.00 RB-27
Loader 4yd Cat. $ 58.50 RL-55
Welder Truck & Rig $ 15.00 PB-911
Office Trailer $ 257.50 / month ▇▇-▇▇
▇-▇
EXHIBIT C
---------
PROJECT DEVELOPMENT AGREEMENT
ARTICLE 1
---------
AGREEMENT
This Agreement is made this 15TH day of JULY in the year 2003, by and between
the
DESIGN-BUILDER
(Name and Address)
▇.▇. ▇▇▇▇▇ CO.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
AND THE
ENGINEER
(Name and Address)
DELTA-T CORPORATION
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
FOR ETHANOL PLANT PROJECT DESIGN DEVELOPMENT SERVICES CONTRACTED BY
OWNER
(Name and Address)
PACIFIC ETHANOL, INC.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
IN CONNECTION WITH THE FOLLOWING
PROJECT
(Name, location and brief description)
PACIFIC ETHANOL PLANT
ETHANOL PRODUCTION AT THE MADERA SITE
C-1
2.0 GENERAL PROVISIONS
----------------------
The Design-Builder has agreed in its Design-Build Agreement with the Owner to
procure the services of licensed design professionals to provide the engineering
services required to design the Project in accordance with the Owner's
requirements. The standard of care for engineering services performed under this
Agreement shall be the care and skill ordinarily used by members of the
engineering professions practicing under similar conditions at the same time and
locality.
The Engineer is hereby authorized to proceed with the necessary preliminary
design development services as outlined below. This Agreement authorizes work in
a lump sum amount of $_ 25,000.00 plus approved travel expenses not to exceed
$10,000.00. Work under this Agreement should commence immediately and be
completed under the consultation with the Design-Builder and as set in a manner
intended to facilitate effective and efficient development of the project. No
other work is authorized without written permission from the Design-Builder. If
Owner obtains project financing, a formal contract for design services will be
forwarded for signature in accordance with Section 10 below.
2.1 TEAM RELATIONSHIP
---------------------
The Design-Builder and Engineer agree to work together on the basis of trust,
good faith and fair dealing, and shall take actions reasonably necessary to
enable each other to perform their obligations under this Agreement in a timely,
efficient and economical manner.
2.2 ROYALTIES, PATENTS AND COPYRIGHTS
-------------------------------------
The Owner, Design-Builder and Engineer agree to defend, indemnify and hold each
other harmless from any suits or claims of infringement of any patent rights or
copyrights arising out of any patented or copyrighted materials, methods or
systems specified by any of them, to the extent that the same is used in a
manner permitted under this Agreement.
2.3 CONFIDENTIALITY
-------------------
The Engineer and Design-Builder shall treat as confidential and not disclose to
any third parties, except as is necessary for the performance of the Services,
or use for its own benefit, any of the Owner's, Design-Builder's or Engineer's
developments, confidential information, know-how, estimating systems, historical
and parameter cost data, discoveries, production methods and the like that may
be disclosed to one another or that may be acquired in connection with the
Services or the performance of this Agreement as set forth under the terms and
conditions of the Non-Disclosure agreements executed by the Engineer and
Design-Builder on April 2, 2003 and by the Engineer and Owner on March 11, 2003
which is incorporated herein and attached hereto as Exhibit A.
3.0 ENGINEER'S RESPONSIBILITIES
-------------------------------
3.1 PROJECT DEVELOPMENT SERVICES
--------------------------------
The Engineer's Development Services are enumerated below and shall generally
consist of a review of the Project information furnished by the Owner and
Design-Builder and the provision of Schematic Design Documents and Design
Development Documents to be used by the Design-Builder to complete a preliminary
project cost estimate (hereafter Engineer's Preliminary Evaluation"). Engineer
shall coordinate its services with all services of design consultants and
subcontractors that may be retained by the Design-Builder. The Engineer shall
identify in writing all material changes and deviations, if any, that it makes
C-2
to any of the deliverables described in Sections 3.1.1 through 3.1.9 below after
it first delivers the same to the Design-Builder. These services shall be
performed in accordance with the schedule established by the Design-Builder.
3.1.1 Assist the Design-Builder to develop and analyze feasible Project
alternatives, including potential facility sites, and assist in the selection of
the most appropriate technical and site options in conjunction with the needs of
the Project.
3.1.2 Provide preliminary projected plant operating costs and assist the
Design-Builder with profitability and sensitivity analyses for selected Project
alternative(s).
3.1.3 Work with the Design-Builder to define Plant specifications, and assist in
developing Project roles and responsibilities for all participating parties.
Deliver preliminary: System Design Specification documenting design criteria,
philosophies and preferences, production and utilities usage rates, a process
flow diagram and the material and energy balance.
3.1.4 Develop a preliminary site layout for the Plant based on the selected
alternatives and site physical and geo-technical data provided by the
Design-Builder.
3.1.5 Provide the following preliminary construction documents to enable the
cost of construction and the cost of the project whole to be estimated for the
purpose of project financing.
o P&ID's
o General Arrangements
o Pipe Material Takeoffs
o Foundation sketches
o Steel sketches
o Electrical Single Line
o Electrical Material takeoffs
o Cost equipment list
3.1.6 Provide preliminary process emissions data for environmental permitting,
site plans and other related support activities based on the above materials as
they apply to a plant without a dryer, in support of the environmental
permitting firm to be retained by the Design-Builder and/or Owner in order to
facilitate prompt project permitting.
3.1.7 Utilize Engineer's experience in ethanol plant operation, products
marketing, and industry economics to assist Design-Builder and Owner in
developing a business plan;
3.1.8 Provide presentation-grade technical and economic data and strategic
guidance to assist Design-Builder and Owner with presentations to potential
equity investors and financial institutions.
3.1.9 Provide preliminary engineering and a construction schedule based on
information that it has already developed for other recent projects or studies
and based on its best assessment of external issues such as environmental
permitting, funding availability, and expected start dates for detailed
engineering and construction.
3.2 Engineer shall continue to develop and make modifications to the items
described in Section 3.1.1 through 3.1.4 above and 3.1.7 and 3.1.8 above as
necessary in accordance with changing or evolving Project plans. The Engineer
C-3
shall perform the above services at such times, and according to such schedule,
as reasonably necessary to support effective development of the Project.
3.3 Preliminary approvals by the Design-Builder or Owner shall not be deemed to
be an assumption of responsibility by the Design-Builder or Owner for any error,
inconsistency or omission in the drawings and specifications or other documents
prepared by the Engineer, its employees, subcontractors, agents or consultants,
who shall be responsible for any such error, inconsistency or omission.
3.4 Engineer shall assist the Design-Builder and Owner in filing required
documents with governmental authorities having jurisdiction over the Project if
required and shall attend meetings with the Owner and Design-Builder upon
request of the Design-Builder.
3.5 All of the Services to be provided by the Engineer shall be rendered
promptly so as not to delay the Design-Builder.
3.6 LIMITED LICENSE
-------------------
The Engineer is and shall remain the sole owner of the confidential information
provided by Engineer hereunder, and of the copyrights in all the drawings and
other documents provided by Engineer under this Agreement. The Engineer hereby
grants Design-Builder a limited, non-exclusive non-transferable license, without
right to sublicense to use the confidential information of Engineer solely for
Design-Builder's use in connection with development and financing of the Project
during the term of this Agreement. The Engineer reserves to itself all rights
not expressly granted under this Section 3.6. In particular, but without
limitation, this license does not include the right to use any of the
confidential information provided by Engineer to procure bids for development or
construction of a plant or to design or operate a plant or facility based on any
such confidential information.
3.7 ENGINEER'S AUTHORIZED REPRESENTATIVE
----------------------------------------
The Engineer's representative is MR. ▇▇▇▇ ▇▇▇▇▇▇▇.
4.0 DESIGN-BUILDER'S RESPONSIBILITIES
-------------------------------------
4.1 PROJECT DEVELOPMENT SUPPORT SERVICES
----------------------------------------
The Design-Builder shall perform, or cause the Owner to perform, the following
tasks to assure development of the Project, and such other tasks as may be
required to achieve funding for the Project:
4.1.1 Provide to the Engineer upon its request such design decisions and
information related to site selection, plant size, interface of the Plant to
other sections of the Project, and other key project design parameters as
Engineer may reasonably request from time to time.
4.1.2 Create a Project development strategy and timeline, in cooperation with
Engineer; hereafter referred to as the "Plan"; for the purpose of defining the
Project specifications and of obtaining one or more letter(s) of commitment for
financing in an amount and on terms and conditions sufficient to enable the
Design-Builder and Owner to execute the Project, and on terms otherwise
acceptable.
C-4
4.1.3 Execute the Plan in a diligent manner.
4.1.4 Cooperate with Engineer to define Project specifications, and define
Project development roles for all participating parties.
4.1.5 Develop a business plan, in cooperation with the Engineer, based on the
information provided by Engineer under Section 3.0 above.
4.1.6 Otherwise cooperate with the Engineer in the development of the Project as
mutually agreed between the Parties.
4.2 To the extent the Design-Builder has obtained the information and services
identified from the Owner, the Design-Builder shall provide them to the
Engineer. The Engineer shall be entitled to rely on such information and
services to the same extent as the Design-Builder.
4.4 DESIGN-BUILDER'S AUTHORIZED REPRESENTATIVE
----------------------------------------------
The Design-Builder's representative is ▇▇. ▇▇▇▇ ▇▇▇▇▇.
5.0 COMPENSATION
----------------
For Services as described, the Design-Builder shall compensate the Engineer a
stipulated fee in the amount of Twenty-five Thousand Dollars and no/100 cents
($25,000.00) plus actual approved expenses for travel in support of the services
not to exceed Ten Thousand Dollars and no/100 cents ($10,000.00). Upon
confirmation that the Owner has obtained the necessary Project Financing, the
Design-Builder shall receive a credit equal to the amount of the fee paid under
this Section 5.0 toward the fee due under the Design/Technology Transfer
Agreements entered into by the Engineer, the Design Builder and Owner under
Section 10 below.
5.1 ADDITIONAL SERVICES
-----------------------
The Engineer shall perform and be compensated FOR approved services in addition
to those described in Section 3.1 above as detailed in Exhibit B attached to
this Agreement.
5.2 PAYMENTS
------------
The Engineer shall submit to the Design-Builder for its approval applications
for payment for Basic and Additional Services. The amount due under Section 5.0
above shall be paid as follows: $10,000 upon signature of this Agreement;
$10,000 within thirty (30)-days thereafter, and the remaining $5,000 within
sixty (60)-days after signature of this Agreement. Any approved amounts due
under this Agreement for additional expenses and costs shall be paid by
Design-Builder within fifteen (15)-days of the Design-Builder's receipt of
Engineer's monthly application for payment.
5.2.1 Prior to final payment, the Engineer shall furnish evidence satisfactory
to the Design-Builder that there are no claims, obligations or Liens outstanding
in connection with the services provided. Acceptance of final payment shall
constitute a waiver of all claims by Engineer for compensation for the services
performed.
5.2.2 Expense records of THE Engineer's personnel, consultants, subcontractors
and services shall be maintained in accordance with generally accepted
accounting principles and shall be available to the Design-Builder at mutually
convenient times.
C-5
6.0 INSURANCE
-------------
Before commencing its Services and as a condition of payment, the Engineer shall
purchase and maintain such insurance as will protect the parties from the claims
arising out of its operations under this Agreement, whether such operations are
by Engineer or any of its consultants or subcontractors or anyone directly or
indirectly employed by any of them, or by anyone for whose acts any of them may
be liable.
6.1 PROFESSIONAL LIABILITY INSURANCE
------------------------------------
The Engineer and all retained consultants shall obtain professional liability
insurance for claims arising from the negligent performance of professional
services under this Agreement, which shall be either General Office Coverage or
Project Specific Professional Liability Insurance written for not less than
those limits and deductibles in the amounts not less than four (4) million
dollar aggregate and two (2) million dollar per claim basis with umbrella
coverage as necessary. The Professional Liability Insurance shall contain prior
acts coverage sufficient to cover all Services performed by Engineer. These
requirements shall be continued in effect as required by the Owner or a minimum
of 2 years after the date of this Agreement. The Engineer shall pay any
deductibles.
7.0 TERMINATION
---------------
This Agreement shall continue for a period of two years unless earlier
terminated as provided by:
7.1 Project Financing from the Owner has not been obtained within two years from
the date of this Agreement.
7.2 Either party may terminate this Agreement upon fifteen (15) days written
notice if the other party materially breaches its terms and conditions through
no fault of the initiating party.
7.3 Termination by the Design-Builder upon at least fifteen (15) days written
notice in the event that the Design-Builder's agreement with the Owner is
terminated.
Upon termination of this Agreement for any reason, the license granted under
Section 3 above shall immediately cease, and each Party shall (i) immediately
cease use of all Confidential Information of the other, (ii) immediately deliver
to the disclosing Party all Confidential Information provided to it by the
other, including all copies of the same, and destroy all materials developed by
it or any third parties to whom it disclosed such information which was based
upon such information, and (iii) certify to the disclosing Party that it has
done so. In particular, but without limitation, the Design-Builder shall
promptly advise all actual and potential investors and lenders for the Project
and all regulatory authorities to which Confidential Information of Engineer has
been provided of the termination hereof, and shall withdraw any applications for
financing or permits that were based on the use of Engineer's Confidential
Information.
8.0 DISPUTE RESOLUTION
----------------------
If a dispute arises out of or relates to this Agreement or its breach, the
parties shall endeavor to settle the dispute first through direct discussions.
If the dispute cannot be settled through direct discussions, the parties shall
endeavor to settle the dispute by mediation under the Construction Industry
Mediation Rules of the American Arbitration Association before recourse to the
dispute resolution procedures contained in this Agreement. The location of the
mediation shall be the location of the Project. Once a party files a request for
mediation with the other party and with the American Arbitration Association,
C-6
the parties agree to conclude such mediation within sixty (60) days of filing of
the request. If the dispute cannot be settled by mediation within sixty
(60)-days, the parties shall submit the dispute to the dispute resolution
process set forth in Exhibit C. Either party may terminate the mediation at any
time after the first session, but the decision to terminate must be delivered in
person by the party's representative to the other party's representative and the
mediator.
9.0 GOVERNING LAW
-----------------
The law in effect at the location of the Project shall govern this Agreement.
10.0 TECHNOLOGY TRANSFER AND FUTURE DESIGN SERVICES AGREEMENT
-------------------------------------------------------------
Time is of the essence for this Project. Upon execution of this Project
Development Agreement, the Owner, Design-Builder and Engineer agree to enter
into good-faith contract negotiations for future Technology Transfer and Design
Services. The Technology Transfer Agreement shall be negotiated and executed by
the Owner, Engineer and Design-Builder and the Design Services Agreement be
shall be negotiated and executed by the Design-Builder and Engineer using the
Associated General Contractors Design-Build Agreement No. 420 between
Design-Builder and Engineer as a template.
The intent being that upon confirmation that the Owner has obtained the
necessary PROJECT Financing, the Owner, Design-Builder and Engineer shall
immediately enter into a Technology Transfer Agreement for the entire plant and
the Design-Builder and Engineer shall immediately enter into a
Design-Builder/Engineer Contractual Agreement to provide the Design Services for
the entire plant.
11.0 LIMITATION OF LIABILITY
----------------------------
Design-Builder's and Owner's sole remedy with respect to any breach by Engineer
OF ANY provision of this Agreement (other than breach of Section 2.3), or with
respect to services performed by Engineer under this agreement, shall be (a)
with respect to any service that does not conform to the requirements of this
Agreement, re-performance by Engineer of such service, and if such service is
not satisfactorily performed within a reasonable time after Engineer's receipt
of written notice of breach from Design-Builder, and in case of any other breach
of this Agreement, (b) termination of this Agreement and refund of the portion
of the fee, if any, allocable to services not properly performed. In no case
shall Engineer be liable for any other damages of any kind, direct, indirect,
incidental, consequential, exemplary or otherwise, with respect to any services
performed by it, or by its failure to perform services, under this Agreement.
12.0 EXCLUSIVE RELATIONSHIP
---------------------------
During the term of this Agreement, neither Design-Builder nor Owner shall enter
into, negotiate toward, or take any other action in furtherance of entering
into, or assisting another to enter into, any agreement for provision of the
technology, services or equipment to be provided by Engineer as currently
contemplated under Section 10.0 above.
13.0 GENERAL PROVISIONS
-----------------------
This Agreement constitutes the entire agreement between the parties relating to
its subject matter, and supersedes all prior representations, understandings and
agreements, written or oral, express or implied. This Agreement can be modified
only by written agreement executed by an authorized representative of each
party.
C-7
THIS AGREEMENT IS ENTERED INTO AS OF THE DATE IN ARTICLE 1
AND BY AUTHORIZED INDIVIDUALS FOR THE COMPANIES LISTED BELOW.
DESIGN-BUILDER:
▇.▇. ▇▇▇▇▇ CO.
BY: BY:
----------------------------- -------------------------------
PRINT NAME: PRINT NAME:
---------------------- ------------------------
PRINT TITLE: PRINT TITLE:
--------------------- -----------------------
ENGINEER:
DELTA-T CORPORATION
BY: BY:
----------------------------- -------------------------------
PRINT NAME: PRINT NAME:
---------------------- ------------------------
PRINT TITLE: PRINT TITLE:
--------------------- -----------------------
C-8
EXHIBIT A
NON-DISCLOSURE AGREEMENT
[AGREEMENTS EXECUTED BY THE ENGINEER AND DESIGN-BUILDER ON APRIL 2, 2003 AND
BY THE ENGINEER AND OWNER ON MARCH 11, 2003 WHICH IS INCORPORATED HEREIN BY
REFERENCE.]
C-9
EXHIBIT B
DELTA-T REIMBUSIBLE RATES
During the term of this agreement, any requests by Owner or Design-Builder for
work not in the scope of this agreement will be billed on an hourly rate and
cost reimbursable basis.
Engineer will provide any further technical services requested by Owner after
August 30, 2003 on an hourly rate and cost reimbursable basis.
Hourly rates for technical personnel include miscellaneous office supplies and
support.
All other costs will be billed at cost plus a 10% administration fee.
DELTA-T TECHNICAL SERVICES HOURLY RATES
---------------------------------------
Category of Employee Hourly Rate
Technical Executive US$ 150
Senior Project Manager US$ 135
Senior Process Engineer US$ 125
Senior Mechanical Engineer US$ 125
Senior I&C Engineer US$ 125
Process Engineer US$ 1 05
Mechanical Engineer US$ 105
I & C Engineer US$ 105
Designer / Draftsman US$ 75
Project Documentation Control US$ 75
Clerical US$ 35
C-10
EXHIBIT C
---------
DISPUTE RESOLUTION PROCEDURE
1. This Agreement shall be construed under the laws of the State of
California. In the event of any dispute between the parties related to
this Agreement, the parties agree to binding arbitration. Arbitration
shall be conducted as follows:
2. Engineer agrees to be bound by the arbitration provisions, if any, in
the prime contract between the Owner and the Design-Builder. The
arbitration provisions of the prime contract, if any, are incorporated
herein by reference. If conflicts arise between the prime contract and
this Agreement, the prime contract shall control.
3. In the event of a dispute involving the Owner, the Engineer, and one or
more Contractors, Subcontractors, the claims and disputes of all
parties shall be heard by the same arbitrator(s) in a single
proceeding. If the Engineer's claim is derived from an act or omission
of the Owner, the Engineer shall prepare and present Engineer's claim
through the Design-Builder's at Engineer's expense.
4. Engineer shall be bound by the result of any arbitration involving
Design-Builder, the Owner, or others regarding matters relating to this
Agreement. However, Engineer shall only be bound so long as (1)
Design-Builder's claim relates to the work of Engineer and (2) any
recovery by Design-Builder would be payable in whole or part to
Engineer.
5. Design-Builder and Engineer waive the right to ▇▇▇ the other party's
payment, performance, contractor's license, or other bonding company or
surety in a court of law. Instead, Design-Builder and Engineer agree
that any claim against sureties shall be resolved by arbitration as
provided in this Agreement. The parties understand and expressly waive
their right to a trial by jury, their right to a motion for new trial,
and their right to appeal. The parties mutually intend by this
provision to prevent a multiplicity of actions and the possibility of
inconsistent results from different forums.
6. In the event a dispute arises that involves only Design-Builder and
Engineer, or their respective agents, employees, or sureties, the
parties agree to binding arbitration. The arbitration shall be
conducted as follows:
(a) In the event of any dispute related to this Agreement, the
parties agree to binding arbitration. Arbitration shall be
commenced by mailing or delivering a written demand for
arbitration by either party upon the other.
(b) Within thirty (30) days of a written demand for arbitration,
each party shall appoint an arbitrator and give written notice
to the other party of such appointment.
(c) The two (2) arbitrators so appointed shall, within fourteen
(14) days, appoint a third arbitrator who shall serve as the
Chairman of the arbitral tribunal.
(d) If either party fails to appoint an arbitrator within thirty
(30) days of notice of a demand for arbitration, the
arbitrator shall be appointed by the Superior Court of Fresno
County, California.
(e) If the two (2) arbitrators appointed fail to agree on a third
arbitrator within fourteen (14) days following appointment of
the second arbitrator, the third arbitrator shall be appointed
by the Superior Court of Fresno County, California.
(f) If an arbitrator fails or is unable to act, his successor will
be appointed in the same manner as the arbitrator he succeeds.
(g) Unless otherwise agreed by the arbitral tribunal and the
parties, the rules and procedures that will be followed in the
arbitration will be the then current Construction Industry
Arbitration Rules of the American Arbitration Association. The
American Arbitration Association shall administer the dispute
through its Submitted Claims process. Each party agrees to pay
its share of fees and expense timely, so as to not delay the
arbitration.
7. The intent of the parties is to resolve all disputes in one forum,
whether it be a multi-party arbitration governed by the Prime Contract
arbitration provisions or a two-party arbitration governed by this
Agreement.
8. The prevailing party in any arbitration or other legal proceeding
regarding any dispute related to this Agreement shall be entitled to
recover its reasonable costs, expenses, expert consultant fees,
arbitrators' fees, arbitration costs and expenses, and attorney fees.
Unless otherwise agreed by the parties, the arbitration shall take
place in Fresno, California. This agreement to arbitrate shall be
specifically enforceable under the laws of California. The award
rendered by the arbitrators shall be final. Judgment may be entered
upon the award in any court of competent jurisdiction.
9. Work Continuation and Payment. Unless otherwise agreed in writing,
Engineer shall carry on the design work and maintain the schedule
and/or work pending arbitration, and, if so, Design-Builder shall
continue to make payments in accordance with this Agreement.
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