Exhibit No. 10.22
ENGINEERING, CONSTRUCTION
AND PROCUREMENT AGREEMENT
between
CROWN ASPHALT RIDGE, L.L.C.
and
CENTRY CONSTRUCTORS &
ENGINEERS, LLC.
November 5, 1997
ENGINEERING, CONSTRUCTION AND PROCUREMENT AGREEMENT
TABLE OF ARTICLES
ARTICLE 1 DEFINITIONS.................................................................................. 1
1.1 Definitions................................................................................... 1
ARTICLE 2 CONTRACTOR'S RESPONSIBILITIES................................................................ 4
2.1 Scope of Work................................................................................. 4
2.2 Engineering Services.......................................................................... 4
2.3 Contractor-Furnished Drawings, Data and Samples............................................... 5
2.4 Owner-Furnished Drawings...................................................................... 6
2.5 Hazardous Material............................................................................ 7
2.6 Additional Work............................................................................... 8
2.7 Subcontractors................................................................................ 9
2.8 Means, Methods and Techniques................................................................. 9
2.9 Coordination of Work; Cooperation............................................................. 10
2.10 Materials, Appliances, Tools, Equipment, Machinery, Supplies, and
Utilities..................................................................................... 10
2.11 Contractor's Plant, Equipment, and Facilities................................................. 11
2.12 Testing....................................................................................... 11
2.13 Use of Completed Portions..................................................................... 11
2.14 Cleanup....................................................................................... 12
2.15 Use of Owner's Construction Equipment or Facilities........................................... 12
2.16 Delivery, Unloading, and Storage.............................................................. 13
2.17 Inspection of Work............................................................................ 13
2.18 Shop Quality Surveillance..................................................................... 13
2.19 Quality Program Requirements.................................................................. 14
2.20 Correction of Defective Work.................................................................. 14
2.21 Backcharges................................................................................... 15
2.22 Waiver of Liens............................................................................... 16
2.23 Responsibility for Work....................................................................... 16
2.24 Temporary Office and Storage Facilities....................................................... 17
2.25 Environmental Conditions...................................................................... 17
2.26 Equal Products and Substitutions.............................................................. 17
ARTICLE 3 OWNER'S RESPONSIBILITIES..................................................................... 18
3.1 Owner's Responsibilities...................................................................... 18
3.2 Owner's Representations and Warranties........................................................ 19
ARTICLE 4 WARRANTIES AND GUARANTIES ................................................................... 19
4.1 Warranty and Guaranties....................................................................... 19
4.2 No Liens and Encumbrances..................................................................... 20
4.3 Exclusions.................................................................................... 20
4.4 Used Materials and Equipment; Special Application Equipment................................... 20
4.5 No Other Warranties........................................................................... 20
4.6 Documentation................................................................................. 21
ARTICLE 5 CONTRACT TIME................................................................................ 21
5.1 Project Schedule.............................................................................. 21
5.2 Mechanical Completion and Final Acceptance.................................................... 22
5.3 Project Schedule, Progress Reporting, and Meetings............................................ 24
5.4 Delays........................................................................................ 25
5.5 Time Extensions or Adjustments................................................................ 26
5.6 Force Majeure Events.......................................................................... 26
5.7 Updated Project Schedule...................................................................... 27
5.8 No Release.................................................................................... 27
5.9 Time Extensions After Final Payment........................................................... 27
5.10 Adjustment to Contract Price.................................................................. 28
5.11 Progress...................................................................................... 28
ARTICLE 6 COMPENSATION................................................................................. 28
6.1 Contract Price................................................................................ 28
6.2 Operation Bonus............................................................................... 28
6.3 Payment....................................................................................... 28
6.4 Time of Payment............................................................................... 29
6.5 Schedule of Values............................................................................ 29
6.6 Applications for Payment...................................................................... 29
6.7 Payment of Subcontractors..................................................................... 31
6.8 Liens and Claims.............................................................................. 31
6.9 Payment or Use Not Acceptance................................................................. 31
6.10 Final Payment................................................................................. 31
6.11 Operation Bonus Payment....................................................................... 32
ARTICLE 7 CHANGES IN THE WORK.......................................................................... 32
7.1 Minor Changes................................................................................. 32
7.2 Value Change Orders........................................................................... 32
7.3 Procedure for Change Orders................................................................... 32
7.4 Continued Performance Pending Resolution of Disputes.......................................... 33
7.5 Effect of Force Majeure Event................................................................. 33
7.6 Documentation................................................................................. 33
7.7 Notice of Change.............................................................................. 33
7.8 Unknown Conditions............................................................................ 33
7.9 Payment for Change Orders..................................................................... 34
ARTICLE 8 COST OF THE WORK FOR CHANGE ORDERS........................................................... 34
8.1 Cost of Design & Engineering Services......................................................... 34
8.2 Construction Labor and Other Cost Items....................................................... 34
8.3 Discounts..................................................................................... 36
ARTICLE 9 SUSPENSION OF THE WORK BY OWNER.............................................................. 36
9.1 Suspension.................................................................................... 36
9.2 Resumption of Work............................................................................ 37
9.3 Effect of Breach.............................................................................. 37
ARTICLE 10 INDEMNIFICATION............................................................................. 37
10.1 Contractor's Indemnification.................................................................. 37
10.2 Owner's Indemnification....................................................................... 38
10.3 Claim Procedure............................................................................... 38
10.4 No Limitation................................................................................. 39
ARTICLE 11 INSURANCE AND WAIVER OF SUBROGATION......................................................... 39
11.1 Contractor's Insurance........................................................................ 39
11.2 Owner's Insurance............................................................................. 41
11.3 Property Insurance Loss Adjustment............................................................ 42
11.4 Waiver of Subrogation......................................................................... 42
11.5 Limitation of Liability of Contractor......................................................... 42
11.6 Damage to Vehicles............................................................................ 43
ARTICLE 12 TERMINATION AND OWNER'S TAKEOVER RIGHTS .................................................... 43
12.1 Termination by Owner for Cause................................................................ 43
12.2 Termination for Convenience................................................................... 44
ARTICLE 13 DISPUTE RESOLUTION.......................................................................... 46
13.1 Commitment to Resolution...................................................................... 46
13.2 Dispute Resolution Procedure.................................................................. 47
13.3 Arbitration................................................................................... 47
13.4 Work Continuance.............................................................................. 48
13.5 Multiparty Proceeding......................................................................... 49
ARTICLE 14 LABOR, SAFETY & SECURITY.................................................................... 49
14.1 Labor, Employees, Supervision................................................................. 49
14.2 Performance of Work, Care Required............................................................ 49
14.3 Strikes....................................................................................... 49
14.4 Illumination.................................................................................. 50
14.5 Accident Prevention........................................................................... 50
14.6 Vehicular Requirements........................................................................ 51
14.7 Explosives and Blasting....................................................................... 51
14.8 Safety........................................................................................ 51
14.9 Protective Equipment.......................................................................... 52
14.10 Contractor Substance Abuse Program............................................................ 52
14.11 First Aid, Hospital, Medical.................................................................. 53
14.12 Clearances Along Roadways and Railroads....................................................... 53
14.13 Contractor's Security Responsibilities........................................................ 53
14.14 Security and Access to Site................................................................... 54
14.15 Fire Prevention............................................................................... 54
ARTICLE 15 MISCELLANEOUS PROVISIONS.................................................................... 55
15.1 Words and Phrases............................................................................. 55
15.2 Team Relationship............................................................................. 55
15.3 Extent of Agreement........................................................................... 55
15.4 Qualification in State........................................................................ 55
15.5 Contractor's Status........................................................................... 56
15.6 Commercial Activities......................................................................... 56
15.7 Site Inspection............................................................................... 56
15.8 Confidential Information...................................................................... 56
15.9 Nonwaiver of Defaults......................................................................... 57
15.10 Conflict of Interest.......................................................................... 57
15.11 Employees..................................................................................... 57
15.12 Laws, Ordinances, Permits, Licenses, and Taxes................................................ 57
15.13 Inventions.................................................................................... 58
15.14 Assignment.................................................................................... 58
15.15 Controlling Law............................................................................... 58
15.16 Severability.................................................................................. 59
15.17 Notices....................................................................................... 59
15.18 No Intended Third Party Beneficiaries......................................................... 60
15.19 Counterparts; Facsimile Signatures............................................................ 60
LIST OF SCHEDULES
SCHEDULE A - Work Scope
SCHEDULE B - Site and Battery Limits
SCHEDULE C - Contractor's Basic Rates
ENGINEERING, CONSTRUCTION AND PROCUREMENT AGREEMENT
This Engineering, Construction and Procurement Agreement (the
"Agreement") is made as of this 5th day of November, 1997 by and between CROWN
ASPHALT RIDGE, L.L.C., a Utah limited liability company ("Owner") and CENTRY
CONSTRUCTORS AND ENGINEERS, LLC, a Utah limited liability company
("Contractor").
Recitals:
A. Owner is the owner of certain real property interests located at
Asphalt Ridge near Vernal, Utah (the "Site") upon which Owner desires to have
constructed a project to be known as the Asphalt Ridge Tar Sands Surface
Facilities Project (the "Project").
B. Contractor is experienced in the engineering, procurement and
construction of mining facilities similar to the Project and desires to provide
the Work, as hereinafter defined, in connection with the Project, upon the terms
and conditions set forth herein.
Agreement:
NOW, THEREFORE, in consideration of the terms and conditions set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Owner and Contractor agree as
follows:
ARTICLE 1 DEFINITIONS
1.1 DEFINITIONS. As used herein, the following terms shall have the
indicated meanings:
1.1.1 Additional Work means services, work, equipment,
material and labor that are outside the scope of the Work set forth in this
Agreement.
1.1.2 Business Day means any day other than a Saturday,
Sunday or holiday on which banks are closed in the State of Utah.
1.1.3 Change shall have the meaning set forth in Section
7.3 hereof.
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1.1.4 Change Order shall have the meaning set forth in
Section 7.3 hereof.
1.1.5 Change Order Notice shall have the meaning set
forth in Section 7.3.
1.1.6 Change Order Request shall have the meaning set
forth in Section 7.3.
1.1.7 Contract Documents means the following documents:
1.2 Change Orders;
1.3 Work Scope;
1.4 Drawings;
1.5 Technical Specifications;
1.6 Amendments to this Agreement;
1.7 This Agreement; and
1.8 All other attachments or documents adopted by
reference in this Agreement.
In case of any inconsistency, conflict or ambiguity among the Contract
Documents, the documents shall govern in the order in which they are listed in
this Section 1.1.7. If any inconsistency will materially affect the Contract
Price or the Work then Contractor shall promptly, upon becoming aware thereof,
provide Owner notice thereof pursuant to ARTICLE 7 and seek written
clarification from Owner. In case of a conflict between any referenced codes,
standards or technical specifications, such conflict will be resolved by a
written clarification from Owner in a manner not inconsistent with the intent of
the Contract Documents or applicable codes.
1.8.1 Contract Price shall have the meaning set forth in
Section 6.
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1.8.2 Contract Time means the entire period for the
performance of the Work commencing upon the Effective Date and ending upon Final
Acceptance, and specifically includes the Mechanical Completion Date.
1.8.3 Contractor means CEntry Contractors & Engineers,
LLC, a Utah limited liability company.
1.8.4 Day means a calendar day unless otherwise
specified.
1.8.5 Detailed Engineering Documents shall have the
meaning set forth in Section 2.2.
1.8.6 Drawings means those drawings identified in the
Work Scope and the Detailed Engineering Documents prepared by Contractor for the
performance of the Work.
1.8.7 Effective Date means November 5, 1997.
1.8.8 Final Acceptance shall have the meaning set forth
in Section 5.2.2.
1.8.9 Final Payment shall have the meaning set forth in
Section 6.10.
1.8.10 Force Majeure Event shall have the meaning set
forth in Section 5.6.1.
1.8.11 Laws means all local, municipal, state and federal
laws, ordinances, rules, directives, orders, and regulations existing as of the
Effective Date or known in the industry to take effect after the Effective Date
related to the Work and to the performance thereof, including, but not limited
to, building and construction codes.
1.8.12 Mechanical Completion of the Work, or of a
designated portion, occurs on the date when construction is sufficiently
complete in accordance with the Contract Documents so that Owner can occupy or
utilize the Work, or a designated portion thereof, for the use for which it is
intended.
1.8.13 Mechanical Completion Date shall have the meaning
set forth in Section 5.1.2.
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1.8.14 Operation Bonus shall have the meaning set forth
in Section 6.2.
1.8.15 Operation Period shall have the meaning set forth
in Section 6.2.
1.8.16 Owner means Crown Asphalt Ridge, L.L.C., a Utah
limited liability company.
1.8.17 Preliminary Schedule shall have the meaning set
forth in Section 5.3.1.
1.8.18 Project Schedule shall have the meaning set forth
in Section 5.3.1.
1.8.19 Punch List Items shall have the meaning set forth
in Section 5.2.1.2.
1.8.20 Retention shall have the meaning set forth in
Section 6.3.
1.8.21 Rules shall mean the Construction Industry
Arbitration Rules of the American Arbitration Association.
1.8.22 Service Agreement shall have the meaning set forth
in Section 6.3.
1.8.23 Site means the area within the battery limits at
Asphalt Ridge near Vernal, Utah, as more fully depicted on Schedule B hereto.
1.8.24 Subcontractor shall means a person or entity who
has an agreement with Contractor or with Contractor's subcontractor or a
Subcontractor at any tier to perform any portion of the Work or who supplies any
equipment that is incorporated as part of the Work. The term "Subcontractor"
does not include any separate contractor employed by Owner.
1.8.25 Used Materials and Equipment means equipment and
materials included as a part of the Work which are specified in the Contract
Documents or in an acknowledgement from Owner as being used, refurbished or
rebuilt, and specifically include, but are not limited to, those items
identified as such in the Work Scope.
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1.8.26 Technical Specifications means those technical
specifications identified in the Work Scope and the Detailed Engineering
Documents prepared by Contractor for the performance of the Work.
1.8.27 Warranty Period means the period commencing on
Mechanical Completion and ending on the date occurring twelve (12)-months after
Mechanical Completion.
1.8.28 Work means the work, services, equipment, material
and labor set forth in the Work Scope, and any other work or services described
in or reasonably to be considered as falling under or required by the provisions
of the Contract Documents and includes, but is not limited to, all design,
engineering, Site preparation, procurement, construction labor, material,
equipment, supplies, all facilities or things or services necessary thereto or a
part thereof, but not inclusive of any work, equipment or materials to be
provided by Owner or any Additional Work that may be provided in accordance with
ARTICLE 7.
1.8.29 Work Scope means the Work described on Schedule A
hereto.
ARTICLE 2 CONTRACTOR'S RESPONSIBILITIES
2.1 SCOPE OF WORK. Contractor shall perform or provide all of the Work
described in the Work Scope. Contractor shall furnish the services of all
supervisors, engineers, designers, draftsmen and other personnel necessary for
the preparation of drawings, specifications, project schedules, cost estimates
and other documents required by the Contract Documents, and shall obtain and
maintain throughout the performance of the Work or for such other periods as may
be required by applicable Laws, all permits, qualifications and licenses
required to be taken out in the name of Contractor which are necessary or
required for the performance of the Work, except for permits, qualifications and
licenses that are the responsibility of Owner hereunder.
2.2 ENGINEERING SERVICES. Contractor shall submit for Owner's review
detailed engineering documents (the "Detailed Engineering Documents"). The
Detailed Engineering Documents shall set forth in detail the requirements for
construction of the Work, and shall consist of drawings and specifications based
upon Laws enacted at the time of their preparation. Construction shall be in
accordance with the approved Detailed Engineering Documents. Three sets of the
Detailed Engineering Documents shall be furnished to Owner prior to commencement
of construction of the portion of the Work depicted in such Detailed Engineering
Documents. Owner and Contractor have received a copy of certain soils and
geotechnical recommendations from a geotechnical engineer (the "Soils Report").
If deemed necessary by Owner, Owner will retain the services of such other
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geotechnical engineers and consultants at Owner's cost as may be required in the
opinion of Owner as the Work progresses. Owner agrees that Contractor is
entitled to rely on the accuracy of the Soils Report without independent
verification, Contractor has no responsibility for the geotechnical engineers or
their recommendations, and that any such information arranged for or provided
prior to the date hereof is for informational purposes only. Owner shall be
responsible for any geotechnical conditions not identified in the Soils Report.
2.3 CONTRACTOR-FURNISHED DRAWINGS, DATA AND SAMPLES. Review by Owner as
provided in Section 2.2 does not constitute acceptance or approval of design
details, calculations, analyses, test methods, certificates, or materials
developed or selected by Contractor, and does not relieve Contractor from full
compliance with the Contract Documents.
2.3.1 Drawings. Unless otherwise provided in this Section
2.3.1 where drawings are required under the Contract Documents, including those
for (a) installing Contractor-furnished material or equipment, or (b) planning
and performance of the Work under the Contract Documents, such drawings shall be
submitted timely by Contractor to Owner prior to the time fabrication,
installation, or performance is commenced on the Work affected thereby. Drawings
of a specific piece of equipment shall identify components with the
manufacturer's part number or reference drawing number clearly indicated. If
reference drawing numbers are used, the review data of such drawings shall be
included. Drawings shall indicate design dimensions, and maximum and minimum
allowable operating tolerances on all major wear kits, i.e., rotating,
reciprocating, or intermittent sliding fits between shafts or stems and seals,
guides, and pivot pins. The sequence of submission of all drawings shall be such
that all information is available for reviewing each drawing when it is
received.
2.4 All drawings submitted by Contractor shall be certified by
Contractor to be correct for the stage of the engineering services being
provided. Owner will conduct a review of Contractor's drawings and a
reproducible drawing marked with one of the following notations will be returned
to Contractor within one (1) Business Day after receipt of the drawing by Owner:
A- Proceed & Approved.
B- Proceed, except as noted on drawing (resubmission not
required).
C- Revise and resubmit.
D- Disapproved (see attachment).
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E- Receipt acknowledged.
2.5 Contractor shall provide three (3) record sets of the final
drawings to be used in fabrication and/or construction.
2.5.1 Samples. Where samples are required by the Contract
Documents, they shall be submitted by Contractor as a part of the Contract
Price. Samples shall be subject to review, and materials represented by such
samples shall not be manufactured, delivered to the Site, or incorporated into
any Work without such review. Contractor shall have the right to proceed with
Work which is the subject of the sample if Owner fails to notify Contractor in
writing of Owner's approval of the sample within one (1) Business Day after
receipt by Owner. If Owner subsequently directs a change in an item, the sample
for which was otherwise in conformity with the Contract Documents when submitted
for review by Contractor, Contractor shall be entitled to a Change Order under
ARTICLE 7.
2.6 Samples which have been reviewed may, at Owner's option, be
returned to Contractor for incorporation into the Work.
2.6.1 Data and Certificates. Where certificates are
required, two (2) copies of each such certificate shall be submitted by and at
the cost of Contractor. Such submittal shall be made not less than three (3)
days prior to the time that the materials represented by such certificates are
needed for incorporation into any portion of the Work. Certificates shall be
subject to review, and material represented by such certificates shall not be
fabricated, delivered to the Site or incorporated into any Work without such
review. Contractor shall the right to proceed with Work which is the subject of
the submittal of the data or certificate if Owner fails to approve same within
one (1) Business Day after receipt. If Owner subsequently directs a change in an
item, the submittal for which was otherwise in conformance with the Contract
Documents when submitted for review by Contractor, Contractor shall be entitled
to a Change Order under ARTICLE 7.
2.7 Certificates shall clearly identify the material being certified
and shall include but not be limited to providing the following information:
Contractor's name, Project name, name of the item, manufacturer's name, and
reference to the appropriate drawing, Work Scope section, and Section number,
all as applicable.
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2.7.1 Ownership of Documents.
2.8 The originals of calculation sheets, design, detail and working
drawings, sketches, specifications, manufacturers' guarantees, and all other
original documents pertaining to or prepared by Contractor for the Work shall be
and shall remain at all times, throughout the Project and hereafter, the
property of Owner.
2.9 Upon Final Acceptance and before Final Payment, Contractor shall
release and deliver to Owner any and all such originals; provided, however, that
Contractor shall have the right to reproduce all such originals for the purpose
of Contractor's record file of the Project.
2.10 OWNER-FURNISHED DRAWINGS. In addition to the Drawings incorporated
in the Contract Documents, Owner shall furnish Contractor with prints of such
pertinent drawings of existing plant Site and structures, requested by
Contractor, as may be available to Owner. Contractor shall be entitled to rely
on the accuracy of such drawings and information unless otherwise expressly
indicated by Owner to Contractor at the time any such drawing or information is
delivered to Contractor. Contractor shall verify all above-grade elevations,
clearances and utilities stub-up locations. Contractor shall give Owner prompt
written notice of any defect in the existing drawings of which Contractor has
actual knowledge.
2.11 HAZARDOUS MATERIAL.
2.11.1 As used herein, "Hazardous Material" is any
substance or material identified now or in the future as hazardous or toxic
under any Law, or any other substance or material which may be considered
hazardous or toxic or otherwise subject to statutory or regulatory requirements
governing handling, disposal and/or clean-up, including, but not limited to,
asbestos or polychlorinated biphenyl (PCB) but shall not include tar sands (or
the components thereof) naturally occurring at the Site. Contractor shall not be
obligated to commence or continue Work until any known or suspected Hazardous
Material discovered at the Site has been removed, rendered or determined to be
harmless by Owner as certified by an independent testing laboratory and approved
by the appropriate government agency.
2.11.2 If after the commencement of the Work, known or
suspected Hazardous Material is discovered at the Site (other than Hazardous
Materials brought on Site by Contractor or any of its Subcontractors),
Contractor shall be entitled to immediately stop Work in the affected area, and
Contractor shall report the condition to Owner and, if required, to any
government entity with jurisdiction.
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2.11.3 Contractor shall not be required to perform any
Work relating to or in the area of known or suspected Hazardous Material (other
than Hazardous Materials brought on Site by Contractor or any of its
Subcontractors) without written mutual agreement.
2.11.4 Unless brought on Site by Contractor or any of its
Subcontractors, Owner shall be responsible for retaining an independent testing
laboratory to determine the nature of the material encountered and whether it is
a Hazardous Material requiring corrective measures and/or remedial action. Such
measures shall be the sole responsibility of Owner, and shall be performed in a
manner minimizing any adverse effect upon the Work of Contractor. Contractor
shall resume Work in the area affected by any Hazardous Material only upon
written agreement between the parties after the Hazardous Material has been
removed or rendered harmless by Owner.
2.11.5 If Contractor incurs additional costs and/or is
delayed due to the presence of known or suspected Hazardous Material (other than
Hazardous Materials brought on Site by Contractor or any of its Subcontractors)
, Contractor shall be entitled to an equitable adjustment in the Contract Price
and the Mechanical Completion Date.
2.11.6 To the fullest extent permitted by Law, but subject
to Section 11.5.2, Owner shall defend, indemnify and hold harmless Contractor,
Subcontractors of any tier, and the members, 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 litigation or arbitration, arising out of
or relating to the performance of the Work in any area affected by Hazardous
Material except with respect to Hazardous Materials brought onto the Site by
Contractor or its Subcontractors. To the fullest extent permitted by Law, but
subject to Section 11.5.2, such indemnification shall apply regardless of the
fault, negligence, breach of warranty or contract, or strict liability of such
indemnitee. Provided, however, that Owner's obligations under this Section 2.5.6
shall not apply to any claims, damages, losses, costs or expenses to the extent
of the fault or negligence of the intended indemnitee.
2.11.7 The terms of this Section 2.5 shall survive the
completion of the Work under this Agreement and/or any termination of this
Agreement.
2.12 ADDITIONAL WORK. The following Additional Work shall be provided
or procured only upon the request of Owner and the agreement of Contractor. A
written agreement between Owner and Contractor shall define the extent of such
Additional Work. Such Additional Work shall be entitle Contractor to a Change
Order pursuant to ARTICLE 7:
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2.12.1 Soils, subsurface and environmental studies,
reports and investigations required for the Project or submission to
governmental authorities or others having jurisdiction over the Project.
2.12.2 Consultations and representations before
governmental authorities or others having jurisdiction over the Project.
2.12.3 Artistic renderings, models and mockups of the
Project or any part of the Project or the Work.
2.12.4 Interior design and related services including
procurement and placement of furniture, furnishings, art work and decorations.
2.12.5 Making revisions to the Detailed Engineering
Documents or documents forming the basis of the Contract Price after they have
been reviewed by Owner, and which are due to causes beyond the control of
Contractor.
2.12.6 Design, coordination, management, expediting and
other services supporting the procurement of materials to be obtained, or work
to be performed, by Owner or Owner's separate contractors.
2.12.7 Estimates, proposals, appraisals, consultations,
negotiations and services in connection with the repair or replacement of any
loss resulting from a Force Majeure Event or any other cause intended to be
covered by insurance.
2.12.8 Document reproduction exceeding the limits provided
for in this Agreement.
2.12.9 Obtaining service contractors and training
maintenance personnel, assisting and consulting in the use of systems and
equipment after thirty (30) days from the Mechanical Completion Date, and
adjusting and balancing of systems and equipment after that date unless any of
such activities are being performed to correct Punch List Items, or items
pursuant to any warranty by Contractor or its Subcontractors hereunder.
2.12.10 Services requested by Owner or required by the
Work which are not specified in the Contract Documents and which are not
normally part of generally accepted engineering or construction services for
work of the nature contemplated hereby.
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2.12.11 Serving or preparing to serve as an expert witness
in connection with any proceeding, legal or otherwise, regarding the Project at
the request of Owner unless expressly required in the Work Scope.
2.13 SUBCONTRACTORS.
2.13.1 Work not performed by Contractor with its own
forces shall be performed by Subcontractors. Contractor may employ such
Subcontractors as Owner has reasonably approved, provided, however, that in the
interests of reducing unnecessary and burdensome paperwork, the requirements of
this Agreement relating to such Subcontractor approvals, or Contractor providing
Owner copies of subcontracts, shall apply only to Subcontractors with a contract
in excess of $100,000 for other than consumable items and commodities. If Owner
does not disapprove in writing of any proposed Subcontractor within two (2)
Business Days after receipt of Contractor's request for approval, such
Subcontractor shall be deemed approved.
2.13.2 Every subcontract shall expressly provide that (a)
should this Agreement be terminated, then the subcontract may be terminated, and
shall set out the terms and procedures for such contract termination, and (b) in
the event this Agreement is terminated, then Owner shall have the option to
continue such subcontract as one between Owner and Subcontractor.
2.13.3 Contractor shall provide for assignment of
subcontract agreements in the event that Owner terminates this Contract for
cause under ARTICLE 12 hereof. Following such termination, Owner shall notify in
writing those Subcontractors whose assignments will be accepted, subject to the
rights of sureties.
2.14 MEANS, METHODS AND TECHNIQUES. Owner shall not be responsible for,
neither will it have control nor charge of means, methods, techniques, sequences
or procedures, or for safety precautions and programs in connection with the
provision of the Work by Contractor. Except as otherwise provided herein, Owner
shall not be responsible for Contractor's failure to carry out the Work in
accordance with the Contract Documents. Owner will not be responsible for or
have control or charge over any of the acts or omissions of Contractor,
Subcontractors of any tier, or any of their agents or employees, or any other
persons performing any of the Work. Owner will communicate with Subcontractors
only through Contractor.
2.15 COORDINATION OF WORK; COOPERATION. By entering into this
Agreement, Contractor acknowledges that there may be other separate contractors
on the Site whose work must be coordinated and scheduled with that of
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Contractor. Contractor shall take all reasonable steps to ensure that its Work
is properly scheduled and coordinated with the work of the separate contractors
in the vicinity of the Work. Contractor will cooperate with separate contractors
and coordinate, as appropriate and reasonable, the requirements for the Work
with the requirements governing the work of the separate contractors and safety
programs, and endeavor to minimize any delay, hindrance or interference with the
work of other separate contractors or Owner; provided, however that the Work
shall at all times have priority over the work of any separate contractor.
Contractor also expressly agrees that, in the event the Work is hindered,
delayed, interfered with or otherwise affected by a separate contractor,
Contractor shall initially attempt to directly resolve issues relating to
scheduling and coordination with any separate contractor. Contractor shall be
entitled to a Change Order for any added costs and/or time required to be
incurred by Contractor in any coordination required by this Section 2.9.
2.16 MATERIALS, APPLIANCES, TOOLS, EQUIPMENT, MACHINERY,
SUPPLIES, AND UTILITIES.
2.16.1 Except as otherwise provided in ARTICLE 3 and in
the Work Scope, Contractor shall provide and pay for all items necessary for the
execution and completion of the Work specified in the Contract Documents,
including, but not limited to, materials, appliances, tools, equipment,
machinery, supplies, utilities, other facilities, and the transportation,
loading and/or unloading thereof; provided, however, that Contractor shall be
required to pay for temporary construction utilities supplied by third parties
only through February 28, 1998, after which date, such cost shall be borne
solely by Owner. Contractor shall be entitled to the free use of any utilities
provided directly by Owner and not by any third party.
2.16.2 In the event that Owner furnishes materials for
incorporation in the Work or equipment for use by Contractor, Contractor is
responsible to visually inspect promptly upon Contractor's receipt thereof, any
materials or equipment provided by Owner for the Work, and must thereafter
promptly inform Owner if any material or equipment provided is found to be
defective based on such visual inspection, provided that Contractor shall not be
responsible for any defects that are not discoverable during such visual
inspection.
2.16.3 Owner will accept no responsibility for protection
of, or policing of, Contractor's equipment, tools, or materials which are
furnished or used in its Work on Owner's property. Contractor must provide
security in accordance with Section 14.14.
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2.17 CONTRACTOR'S PLANT, EQUIPMENT, AND FACILITIES.
2.17.1 Contractor shall provide and use on any Work only
such construction plant and equipment as are capable of producing the quality
and quantity of Work and materials required by the Contract Documents and within
the time or times specified in the Project Schedule. Contractor's equipment, and
that of its Subcontractors, shall at all times be in safe and good working order
and shall meet the requirements of MSHA/OSHA for operating condition to the
extent applicable. Use of equipment not meeting these requirements shall be
discontinued until repaired. Owner reserves the right to direct Contractor to
remove substandard equipment from the Site.
2.17.2 Before proceeding with any Work or with erection of
any facilities including but not limited to temporary structures, machinery,
equipment, offices, warehouses and camps, Contractor shall furnish Owner with
such information and drawings relative to such equipment, plant and facilities
as Owner may reasonably require.
2.18 TESTING.
2.18.1 Any equipment furnished by Contractor or by Owner
for installation by Contractor as part of the Work, will be initially tested and
adjusted for mechanical operation by Contractor prior to Final Acceptance with
the assistance of Owner in accordance with the manufacturer's recommendations
therefor.
2.18.2 Contractor shall be responsible for installation of
all materials and equipment included in the Work in accordance with
manufacturer's instruction or according to the Contract Documents.
2.18.3 If tests in addition to those required by the
Contract Documents are desired by Owner, Contractor shall be advised in
reasonable time to permit such testing. Such additional tests will be at Owner's
expense and shall entitle Contractor to an increase in the Contract Price and
the Contract Time.
2.18.4 Except as explicitly identified in the Work Scope,
Owner shall furnish and pay for all materials, operators, equipment and
utilities required for any tests, including all raw materials, utilities, water,
testing equipment, and other materials.
2.19 USE OF COMPLETED PORTIONS.
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2.19.1 Whenever any portion of Work performed by
Contractor is mechanically complete, Owner may take possession of or use such
portion subject to the requirements of any insurance underwriters. If Owner
takes possession of any portion of the Work, such portion shall be deemed to
have achieved Mechanical Completion.
2.19.2 Any use by Owner of the Work as contemplated in
Section 2.13.1 hereof, shall in no case be construed as constituting acceptance
of the Work, and shall neither relieve Contractor of any of its responsibilities
under this Agreement, nor act as a waiver by Owner of any of the conditions
thereof. However, if such use increases the cost or delays the completion of
remaining portions of Work, Contractor shall be entitled to a Change Order for
such cost and/or delay in accordance with the provisions of ARTICLE 7 of this
Agreement. Owner shall solely be responsible for any damage or ordinary wear and
tear caused by such use and Contractor's warranties with respect to such portion
of the Work shall commence to run as of the date such use commences.
2.19.3 Notwithstanding the use of any portion of the Work
by Owner pursuant to this Section 2.13, Contractor shall have full access to
such portion of the Work to the extent Contractor believes is necessary for the
performance of the remaining portions of the Work. Contractor shall not be
liable for any interference, hinderance, shutdowns, or other effects caused by
Contractor's access to such portion of the Work or performance of the balance of
the Work.
2.20 CLEANUP.
2.20.1 Contractor shall, at all times, keep its work areas
and that of its Subcontractors in a neat, clean, and safe condition. Disposal
areas for rubbish and debris at the Site will be designated by Owner.
2.20.2 At the completion of its Work, Contractor shall
promptly remove its equipment, temporary structures, debris, and excess
materials from Owner's property and leave the Site in a neat and clean
condition.
2.20.3 If Contractor or its Subcontractors fail to comply
with this Section 2.14 after reasonable written notice, Owner may remove such
equipment, temporary structures, debris, and excess materials at its expense and
will backcharge Contractor for the reasonable costs necessarily incurred by
Owner in connection therewith in accordance with Section 2.21.
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2.21 USE OF OWNER'S CONSTRUCTION EQUIPMENT OR FACILITIES.
2.21.1 Circumstances may arise where Contractor requests
Owner to make available to Contractor certain equipment or facilities belonging
to Owner for the performance of the Work. If Owner agrees to such request, the
equipment or facilities will be charged to Contractor at agreed rental rates;
provided that Owner shall not charge Contractor for the facilities to be
provided to Contractor pursuant to the provisions of the Work Scope.
2.21.2 Owner will furnish a copy of the equipment
maintenance and inspection record before equipment is rented, and these records
shall be maintained by Contractor during Contractor's use of equipment.
2.21.3 In the event such equipment is furnished with an
operator, such operator will perform its services under the complete direction
and control of Contractor and shall be considered Contractor's employee for all
purposes (including being covered by Contractor's insurance with respect to such
activities) other than the payment of wages, worker's compensation, or other
benefits, whether paid directly or indirectly by Owner.
2.22 DELIVERY, UNLOADING, AND STORAGE.
2.22.1 Contractor shall receive, unload, store in a secure
place, and deliver from storage to the Site all materials and plant equipment,
including Owner-furnished materials and plant equipment, required for the
performance of the Work. The storage facilities and methods of storing shall
comply with manufacturer or supplier requirements. Materials and equipment
subject to degradation by outside exposure shall be stored off the ground, on
dunnage in a weather-tight enclosure provided by Contractor.
2.22.2 Contractor shall keep complete and accurate
records, for Owner's inspection, of all materials and plant equipment received,
stored, and issued for use in the performance of the Work.
2.23 INSPECTION OF WORK.
2.23.1 Owner shall at any and all times have reasonable
access to the Work being performed hereunder, and all aspects thereof and to the
premises affected thereby, for inspection purposes, including the utilization at
Owner's expense of third-party inspectors and quality control personnel; and
Contractor shall provide reasonable facilities for such access and inspection.
15
2.23.2 If the Contract Documents or applicable Laws
require any portion of the Work be tested or approved, Contractor shall notify
Owner of the readiness for inspection, and Owner will promptly inspect such
Work. If any such Work is covered up by Contractor without approval or consent
of Owner, Contractor shall, if required by Owner, uncover the Work for
examination and recover the Work without additional cost to Owner.
2.24 SHOP QUALITY SURVEILLANCE.
2.24.1 Further to the provisions of Section 2.17, Owner's
representative shall be afforded reasonable access to all areas of the
manufacturing plants while any Work is in progress. Upon Owner's reasonable
request, Owner's representative will be furnished with reasonable information
and access necessary to verify the Work is being performed in accordance with
the Contract Documents.
2.24.2 Owner's representative may visit the fabrication
plant on a regular basis to monitor the Work in progress. The frequency of these
visits shall be in relation to the level of work activity and the quality
history of the fabrication plant.
2.25 QUALITY PROGRAM REQUIREMENTS.
2.25.1 Contractor shall be required to establish and
maintain a quality program suitable for Work Scope and shall designate in
writing to Owner, the name of individual(s) responsible for ensuring that the
program is implemented. A quality plan shall be prepared to ensure adequate
control and assurance of quality.
2.25.2 The quality plan, including its procedures and
operations, shall be documented and, upon reasonable request by Owner, shall be
subject to review by Owner. The plan shall apply to the control of quality
throughout all areas of performance, including as appropriate, the design,
procurement, identification, stocking, and issue of material; construction,
identification or manufacturing process control; preservation of constructed
items or systems including unused materials until release and/or acceptance as
defined by the Contract Documents.
2.25.3 The plan shall provide that discrepancies in
products, materials, workmanship, or constructed items which do not conform to
the Contract Documents be reported to Owner and corrective action be taken as
provided in the plan. Provisions shall be included for the periodic review of
program criteria, adequacy and implementation. Program discrepancies shall be
reported and corrective actions taken.
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2.26 CORRECTION OF DEFECTIVE WORK.
2.26.1 At any time before Mechanical Completion, should
any installed material or workmanship be of lesser quality than that specified
by the Contract Documents (except for Used Equipment and Materials or materials
otherwise approved by Owner), Contractor shall, upon receipt of Owner's written
notice of such nonconformity and the bases thereof, remove any nonconforming
Work and any other Work damaged by the nonconforming Work and replace the
nonconforming Work and any other Work affected by replacing the nonconforming
Work, using conforming materials for that specified, all without additional cost
to Owner. If Contractor is not able within a reasonable time after written
demand to remove or replace, as required by the foregoing sentence, Contractor
shall be responsible to Owner for any reasonable costs incurred by Owner in
replacing or repairing such nonconforming Work. Owner has the option to withhold
applicable and reasonable portions of the payment due Contractor until such
replacement or repair Work has been completed. This Section is complementary to,
and is to be taken in conjunction with ARTICLE 4 and shall not be construed as
limiting Owner's rights or remedies as provided therein. Correction of defective
or nonconforming Work after the Mechanical Completion Date is covered by
Contractor's warranties and guaranties set forth in ARTICLE 4 hereof.
2.26.2 Re-examination of questioned Work may be ordered by
Owner and, if so ordered, the Work shall be uncovered by Contractor, if
necessary. If such Work is found to be in accordance with the Contract
Documents, Owner will pay the cost of uncovering and covering as Additional Work
as a Change Order to the Contract Price, and Contractor shall be entitled to an
extension of the Contract Time for the time required to uncover, test and
recover such Work. If the uncovered Work is found not to be in accordance with
the Contract Documents, Contractor shall pay all costs of uncovering and
covering in addition to the costs of correcting the nonconforming Work disclosed
and shall not be entitled to any extension of the Contract Time related thereto.
2.27 BACKCHARGES. In addition to the rights and obligations attendant
to ARTICLE 4, Owner shall have the following rights and Contractor the following
obligations:
2.27.1 In the event prior to Mechanical Completion the
item or items furnished by Contractor under this Agreement are found to be in
nonconformity with the Contract Documents as to workmanship and/or materials, it
remains the responsibility of Contractor to promptly correct any deficiency when
so directed. Owner will take reasonable measures to discover such non-compliance
as quickly as practical. However, failure to do so shall in no way relieve
Contractor of its responsibility prior to Mechanical Completion to promptly make
such corrections and/or modifications as required so as to minimize delay and/or
damage to other Work. Correction of defective or nonconforming Work after the
17
Mechanical Completion Date is covered by Contractor's warranties and guaranties
set forth in ARTICLE 4 hereof.
2.27.2 If upon being notified by Owner of nonconforming
Work and having been directed to correct the nonconforming Work by a specific
date consistent with the current Project Schedule, Contractor states, or by its
action indicates to Owner, its inability or unwillingness to comply, then Owner
after at least five (5) days' prior written notice to Contractor may, without
limiting any other rights or remedies of Owner, proceed to have the Work
accomplished by others and backcharge Contractor for the reasonable cost of such
required Work.
2.27.3 The cost of such backcharge Work shall be computed
as follows:
2.28 Manual labor including foremen shall be charged at the total of
bare cost plus reasonable, actual payroll additives, plus an amount equal to
fifteen percent (15%) of such costs.
2.29 Material shall be charged at the actual delivered cost, plus ten
percent (10%) of such costs.
2.30 Equipment rental shall be charged at prevailing job Site rates.
2.31 Reasonable indirect costs, i.e., Project overhead, supervision,
administration, held engineering, materials handling, and procurement shall be
charged at actual reasonable cost, pro rata, plus an amount equal to fifteen
percent (15%) of such costs.
2.32 All reasonable contract costs for having the backcharge Work
performed by other contractors (including such contractors, labor, material,
equipment, and reasonable overhead and profit), shall be charged at actual
out-of-pocket cost.
2.33 Before proceeding on such backcharge Work, Owner will advise
Contractor and forward to Contractor an Authorization of Backcharge for
Contractor's signature. However, failure of Contractor to provide such written
authorization shall not impair Owner's right to proceed to have the Work
performed and charge Contractor therefor. Contractor shall pay actual costs
incurred, computed as set forth above, or Owner may withhold such sum from funds
due Contractor. The performance of backcharge Work shall relieve Contractor of
18
its responsibilities under the Contract Documents with respect to express or
implied warranties, guarantees and specified standards for quality with respect
to such backcharge Work.
2.34 WAIVER OF LIENS.
2.34.1 Subject to Contractor's receipt from Owner of
amounts due under this Agreement, Contractor hereby waives to the fullest extent
permitted by Law all mechanics, other liens, or payment bond claims for or on
account of the Work done or materials furnished hereunder so that the
improvements of structures wherein the same may be incorporated and the land to
which they are appurtenant shall at all times be free and clear of all such
liens and claims. Contractor agrees to pay out-of- amounts received from Owner
for such purpose all amounts properly due by it to all Subcontractors and other
persons performing any Work or furnishing any labor or materials for any of the
Work. The foregoing lien releases shall be effective for Work done and materials
furnished through the date of the lien release and to the extent of payments
received by Contractor.
2.34.2 Subject to Contractor's receipt from Owner of
amounts due under this Agreement, if such liens or claims are placed on Owner's
property by any person performing any Work or furnishing any labor or materials
for any of the Work, Contractor shall, upon the request of Owner, have such
liens or claims removed at Contractor's expense and Contractor shall indemnify
Owner from any liabilities associated with such lien pursuant to ARTICLE 10 to
the extent Contractor has received from Owner all amounts due under this
Agreement.
2.34.3 Contractor agrees that it shall include, in every
subcontract related to this Project, provisions under which the Subcontractor
waives any mechanics, other liens, or payment bond claims it may have under Law
to the extent of payments received, and agrees to pay all amounts due by such
Subcontractor to any person performing any work or furnishing any labor or
materials to Subcontractor for any of the Work covered by this Agreement.
2.35 RESPONSIBILITY FOR WORK. Subject to Section 2.13, Contractor shall
be responsible for and shall bear any and all risk of loss or of damage to Work
until Mechanical Completion unless caused by the acts or omissions of Owner or
Owner's separate contractors.
2.36 TEMPORARY OFFICE AND STORAGE FACILITIES. Contractor shall be
responsible for providing office and storage facilities for its own use at the
Site in a location reasonably designated by Owner.
2.37 ENVIRONMENTAL CONDITIONS. Throughout performance of its Work,
19
Contractor shall conduct all operations in such a way as to comply with Section
15.12, and Section 2.5. Subject to Section 2.5 and ARTICLE 3, Contractor shall
provide the following:
2.37.1 Suitable equipment, facilities and precautions to
prevent the discharge of contaminants from the Work which may violate any
environmental Law.
2.37.2 Fugitive Dust Control - Contractor shall be
responsible to provide reasonable fugitive dust control measures at all
excavations, material sites, demolitions, roads, disposal areas, borrow areas
and construction sites related to the Work of Contractor. Fugitive dust
generated from disturbed areas created by the construction shall be stabilized
by water spray or other method accepted by Owner.
2.37.3 Water Containment - Upon commencement of excavation
at the Site, as prescribed by and in accordance with applicable permits of which
Contractor has been advised by Owner through the Mechanical Completion Date,
Contractor shall retain any storm water drainage occurring on the Site from
being released as surface flow onto adjacent property provided that such
obstructions do not materially interfere with the Work. Contractor shall have
the right, without liability to Owner or any third party, to erect berms,
barriers or other obstructions to prevent storm water drainage from entering the
Site from adjacent property. Contractor shall have no the obligation or
liability to manage any storm water drainage diverted from entering the
boundaries of the Site.
2.38 EQUAL PRODUCTS AND SUBSTITUTIONS (does not apply to Used Materials
and Equipment). The naming of a certain brand, make or manufacturer or article,
device, product, material, fixture, form or type construction by name, maker or
catalog number, shall convey the general style, type, character and standard of
quality of the article desired and shall not be construed as limiting
competition. Contractor, with Owner approval, may propose to use any article,
device, product, materials, fixture, form or type of construction which in the
judgment of Contractor and Owner is equal to or better than the specified item
considering quality, workmanship, economy of operation, suitability for the
purpose intended, and acceptability for use on the Project.
2.39 PROCUREMENT. Contractor shall procure and pay for, in Contractor's
name as an independent contractor and not as agent for Owner, all Contractor and
Subcontractor labor, materials, equipment, supplies, manufacturing and related
services (whether on or off the Site) for construction of and incorporation into
the Work that are required by the Work Scope for completion of the Project in
accordance with this Agreement and are not explicitly specified to be furnished
by Owner. Except for Used Materials and Equipment, such items shall be new,
unless otherwise agreed by Owner and Contractor, and warranted and guaranteed as
set forth in ARTICLE 4. Upon the first to occur of (a) initial operation of the
20
Project, or (b) termination of this Agreement, all such warranties and
guaranties to which Contractor has rights shall be assigned by Contractor to
Owner or Owner's assignee; provided that Contractor shall have the benefit of
such warranties to the extent Owner makes any warranty claim against Contractor
related to the items to which any such warranty applies. Neither Contractor, its
Subcontractors, nor any person under Contractor's control shall knowingly take
any action that will release, void, impair or waive any warranties or guaranties
on equipment, materials or services that it procures from others.
ARTICLE 3 OWNER'S RESPONSIBILITIES
3.1 OWNER'S RESPONSIBILITIES. In addition to its obligations set forth
elsewhere in the Contract Documents, Owner shall:
3.1.1 obtain and pay for all required permits and
licenses, certificates, government allocations, authorizations, priorities and
approvals necessary for the Project which are required to be taken out in
Owner's name (collectively "permits") (except building permits and normal
construction type permits which are the responsibility of Contractor). Owner
shall promptly advise Contractor in writing of any permit conditions,
requirements or limitations that apply to Contractor or the performance of the
Work and shall submit any notifications required to the appropriate governmental
authority. Permits that are the responsibility of Owner include, but are not
limited to, environmental, air quality and mining permits, and any permits
relative to permanent facilities, pollution and water rights. Owner specifically
acknowledges that the Work Scope contemplates a Project with a nominal capacity
of 3000 tons per day and that Owner's existing permits may allow a Project of
only 2000 tons per day capacity. It is the responsibility of Owner, not
Contractor, to obtain any necessary permits, approvals and consents necessary to
permit the Project to be constructed and operated at design capacity as set
forth in the Work Scope. Contractor shall be entitled to a Change Order for the
effect of the failure to obtain, or the changed terms and conditions of, any
necessary governmental permits, approvals and consents other than those that
Contractor is obligated to obtain, as specified in the Work Scope necessary to
allow the Project to be constructed and operated as set forth in the Work Scope.
3.1.2 appoint one or more individuals who shall be
authorized to act on behalf of Owner, with whom Contractor may consult at all
reasonable times, whose instructions, requests, and decisions will be binding
upon Owner as to all matters pertaining to the Project, the Work and the
performance of the parties hereunder.
3.1.3 pay Contractor the costs and compensation provided
for in the Contract Documents.
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3.1.4 furnish Contractor information in the possession of
Owner identifying the type and location of utility lines and other man-made
objects beneath the Site or otherwise informing Contractor of any utility lines
of which Owner is aware. Contractor shall have the right to rely upon such
information and shall have no liability for any damage or injuries related to
underground utilities or other man-made objects that are not located or
identified on the drawings or other documents provided by Owner.
3.1.5 promptly report to Contractor any defects or
suspected defects in the Work in order that Contractor may take prompt,
effective measures to correct the defect.
3.1.6 provide and permit Contractor and its Subcontractors
the free use of water, air, light, heat and other utilities, at the locations on
the battery limits of the Site identified on Schedule B, all at locations
mutually acceptable to Contractor and Owner. Permanent utilities shall be
installed by Owner and be available for use by Contractor without cost to
Contractor at such locations no later than March 1, 1998 or Owner shall
reimburse Contractor by way of Change Order for the costs of continuing
temporary utilities at and to the Site after such date.
3.1.7 furnish the Site, with areas for storage and
handling of construction materials and equipment, field fabrication and assembly
work.
3.1.8 provide supervisory, technical and operating
personnel for package turnover of the Project, including electrical system
checkout, equipment calibrations and tests.
3.1.9 furnish required Owner information and Owner-
furnished equipment in a timely manner and render timely decisions pertaining
thereto.
3.2 OWNER'S REPRESENTATIONS AND WARRANTIES. Owner represents
and warrants to Contractor as follows:
3.2.1 Owner has and during the Contract Time will maintain
sufficient financial capacity and resources to perform all of Owner's
obligations under the Contract Documents, including but not limited to payment
of the Contract Price to Contractor when and as such payments become due.
3.2.2 Except with respect to certain government
22
environmental and operating permits that Owner will obtain as provided herein,
Owner has all requisite technology licenses, consents, approvals and
authorizations to enter into this Agreement and have the Project constructed on
the Site.
ARTICLE 4 WARRANTIES AND GUARANTIES
4.1 WARRANTY AND GUARANTIES. Except as otherwise provided in Section
4.4 hereof, Contractor warrants and guaranties to Owner for the Warranty Period
that all equipment, materials and other items furnished as a part of the Work
under this Agreement shall be of good quality and free from defective
workmanship and as otherwise warranted in the Work Scope. Contractor agrees to
correct promptly as a part of the Contract Price any Work performed hereunder
that, at any time during the Warranty Period proves to be defective or deficient
in material or workmanship. The Work shall conform in all material respects with
the approved plans, drawings and specifications for the Project. After receipt
of a written notice from Owner which shall be given within thirty (30) days
after discovery of such defective or deficient material or workmanship,
Contractor shall bear all costs and expenses associated with correcting any
warranted work, including, without limitation, necessary disassembly,
transportation, reassembly and re-testing, as well as reworking, repair or
replacement of such Work, and disassembly and reassembly of adjacent work when
necessary to give access to the defective or nonconforming Work. Contractor's
obligations under this Section 4.1 shall survive Final Acceptance of the Work
and termination of the Agreement for the Warranty Period. Nothing in this
Section 4.1 shall be construed to establish a period of limitation with respect
to other obligations Contractor might have under the Contract Documents.
Contractor shall use its reasonable efforts to obtain a minimum of a twelve (12)
month warranty commencing on Mechanical Completion on all new purchased major
engineered equipment provided as a part of the Work.
4.2 NO LIENS AND ENCUMBRANCES. Contractor warrants and guaranties that
when title to the Work passes to Owner, it shall pass free and clear of all
liens, claims, security interests and other encumbrances, and that none of such
Work shall be acquired by Contractor subject to any agreement under which a
security interest or other lien or encumbrance is retained by any person.
4.3 EXCLUSIONS. The warranties and guaranties set forth in this ARTICLE
4 shall not apply in the case of misuse, abuse, neglect or unauthorized
modifications, repairs or substitutions by Owner to the Work and as otherwise
excluded or limited in the Work Scope. No warranty is provided for equipment,
materials or labor furnished by persons other than Contractor or its
Subcontractors or for normal wear and tear. Owner acknowledges that except as
expressly identified in the Work Scope, Contractor is not performing process
engineering for the Project and except as expressly identified in the Work
Scope, Contractor does not represent, warrant or guarantee that the Project will
23
achieve any desired level of production throughput, quality of product or other
performance criteria.
4.4 USED MATERIALS AND EQUIPMENT; SPECIAL APPLICATION EQUIPMENT. Any
Used Materials and Equipment products, equipment, systems or materials
incorporated in the Work at the direction, with the consent of, or upon the
specific request of Owner, shall be covered exclusively by the warranty, if any,
of the manufacturer and/or vendor and is not included in the warranty set forth
in Section 4.1 hereof. There are no warranties which extend beyond the
description on the face thereof.
4.5 NO OTHER WARRANTIES. THE WARRANTIES, GUARANTIES AND REMEDIES SET
FORTH ABOVE AND IN THE WORK SCOPE ARE IN LIEU OF ANY OTHER AVAILABLE AT Law OR
OTHERWISE. ALL OTHER WARRANTIES EXPRESSED OR IMPLIED INCLUDING THE WARRANTY OF
MERCHANTABILITY AND THE WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE ARE
EXPRESSLY DISCLAIMED.
4.6 DOCUMENTATION. Contractor shall collect all written warranties and
equipment manuals for engineered equipment that is part of the Work and deliver
them to Owner.
ARTICLE 5 CONTRACT TIME
5.1 PROJECT SCHEDULE.
5.1.1 Single Schedule. Owner and Contractor are committed
to using the Project Schedule to their best mutual advantage. They agree to work
to one schedule developed openly and by mutual agreement, with no hidden
schedules or agendas for either; that they will both participate in developing a
Project Schedule upon which they can both rely; that they will work together to
ensure the schedule is properly and timely updated at least monthly, and if
circumstances require, at more frequent intervals; and that they have agreed on
the Mechanical Completion Date set forth below which reflects their time goals
and accommodates Owner's needs.
5.1.2 Mechanical Completion Date. Contractor agrees to
achieve Mechanical Completion of the Work no later than May 16, 1998, as such
date may be adjusted as provided by the terms of this Agreement (the "Mechanical
Completion Date"). The Mechanical Completion Date has been agreed upon based on
the understanding that both parties will cooperate with each other to expedite
approvals, consents, permits and other time sensitive matters so that the Work
can proceed in a logical and expeditious manner.
24
5.1.3 Early Completion. For each day that Contractor
achieves Mechanical Completion prior to the Mechanical Completion Date, as such
Date may be adjusted as provided herein, Owner shall pay Contractor the
following amounts. This early completion bonus shall be paid within fifteen (15)
days after Mechanical Completion:
Calendar Days
-------------
Dollars Per Day
---------------
1 through 15
$ 2,500 for each day through the fifteenth (15th) day
16 or more
$ 5,000 for each day after the fifteenth (15th) day
In no event shall the bonus amount for the first fifteen
(15) days of any early completion period exceed $2,500 per day regardless of how
early Mechanical Completion is achieved.
5.1.4 Liquidated Damages. For each day that Mechanical
Completion is not achieved after the expiration of the Mechanical Completion
Date, as such Date may be adjusted as provided herein, Contractor shall pay
Owner the following amounts as agreed upon and liquidated damages. The
liquidated damages shall be deducted from the Final Payment and shall be Owner's
exclusive remedy for delay in achieving Mechanical Completion assuming
Mechanical Completion is eventually achieved.
Calendar Days
-------------
Dollars Per Day
---------------
1 through 15
None
16 through 30
$ 2,500 for each day after the sixteenth (16th) day through the
thirtieth (30th) day
31 or more
$ 7,500 for each day after the thirtieth (30th) day
25
In no event shall the liquidated damages for days 16
through 30 of any delay period exceed $2,500 per day regardless of how late
Mechanical Completion is achieved.
5.2 MECHANICAL COMPLETION AND FINAL ACCEPTANCE PROCEDURES.
5.2.1 Mechanical Completion Procedure.
5.3 Contractor and Owner shall develop a mutually agreed upon turnover
package plan consisting of the breakout of the Work into major areas (as defined
in the Work Scope) schedule for package turnover and acceptance procedures.
5.4 Within five (5) Business Days after receipt of Contractor's notice
that a turnover package is or will be mechanically complete, Owner and
Contractor will test and inspect the turnover package in order to achieve
Mechanical Completion on a coordinated area-by-area basis. Based upon this test
and/or inspection of the turnover package, Owner shall, within two (2) Business
Days after completion of the tests and inspections, identify any defects,
deficiencies and/or discrepancies between the installed equipment, materials and
workmanship as represented by the specifications, of which it has knowledge. If
no defects or deficiencies are noted or identified, the area which was part of
the turnover package shall be deemed to be mechanically complete (but Contractor
shall not be relieved of any liability therefor under ARTICLE 4 or elsewhere in
this Agreement). If defects or deficiencies are noted or identified Contractor
shall take corrective action for such defects, deficiencies and/or
discrepancies. Subsequent to performing corrective measures to remove such
defects, deficiencies and/or discrepancies which present an unsafe operating
condition or adversely affect the reliable operation of the Project, Contractor
shall again provide notice to Owner that the turnover package is mechanically
complete, at which time Owner and Contractor shall again, within two (2)
Business Days of such notice, test and inspect the turnover package in order to
achieve Mechanical Completion, and this sequence of steps shall be repeated
until each turnover package is mechanically complete. With respect to those
defects, deficiencies and/or discrepancies which do not present an unsafe
condition or affect the reliable operation of the Project, Contractor and Owner
shall develop a "punch list" of items requiring correction by Contractor (the
"Punch List Items") to effect Final Acceptance and such items shall not be the
cause of delaying Mechanical Completion.
5.5 Contractor shall provide notice to Owner that Contractor deems the
entire Work to be mechanically complete when the Work and each component, system
or subsystem thereof (i) complies with all provisions of the Contract Documents
relating to the installation except for Punch List Items; (ii) is ready for
26
start-up of operations at the design criteria specified in the Work Scope; (iii)
may be operated without damage to the Work or any other property and without
injury to any person, and in compliance with permits (of which Contractor has
knowledge as of the date on which the Detailed Engineering Documents were
prepared or implemented by Change Order as provided herein) and in compliance
with applicable Laws; and (iv) the equipment is ready for initial operation (at
the design criteria specified in the Work Scope), adjustment and testing.
5.6 During tests and inspections for Mechanical Completion, Owner shall
provide operating and maintenance personnel as necessary to determine Mechanical
Completion.
5.6.1 Final Acceptance Procedure.
5.7 Subsequent to Mechanical Completion and upon completion of the
Punch List Items, Contractor shall provide notice to Owner that Contractor deems
the Work ready for Final Acceptance. Final Acceptance shall be deemed to have
been achieved when all of the following have occurred:
5.7.1 Owner has been assigned all permits, licenses, and
approvals obtained by Contractor and assignable to Owner.
5.7.2 Owner has received all Drawings and Specifications,
including record drawings of the Work, test data, and other technical
information required by the Contract Documents.
5.7.3 Contractor has successfully completed all tests of
the Work required by the Contract.
5.7.4 Owner has received all operations, maintenance, and
spare parts lists and manuals and all instruction books required by the
Contract Documents.
5.7.5 Contractor has performed and corrected all Punch
List Items pursuant to Section 5.2.1.2 herein.
5.7.6 The Work has been completed in accordance with
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applicable Laws, and in accordance with applicable permits relating to design
and construction known to Contractor at the time the Work was performed.
5.8 Within ten (10) days after receipt of notice that the Work is ready
for Final Acceptance, Owner using reasonable efforts, shall give notice to
Contractor of any deviation from the requirements of Section 5.2.2.1 above of
which it then has knowledge. Contractor shall then perform corrective measures
to remove such deviations and shall again provide notice to Owner that the Work
is deemed ready for Final Acceptance. Owner will have five (5) days after each
subsequent notice to advise Contractor of any additional or remaining deviations
from the requirements of Section 5.2.2.1 above of which it is aware which must
be corrected by Contractor as a condition to Final Acceptance.
5.9 If no deviations exist, or if Owner fails to notify Contractor of
any deviations within the above time frames, Final Acceptance will be deemed to
have been achieved, and Owner shall immediately issue a notice of Final
Acceptance dated to reflect the actual date of Final Acceptance.
5.10 Contractor understands that it is important to Owner that Final
Acceptance occur as soon as reasonably practicable after Mechanical Completion.
Therefore, Contractor agrees to promptly and diligently complete the
requirements of Section 5.2.2.1 above following Mechanical Completion.
5.11 PROJECT SCHEDULE, PROGRESS REPORTING, AND MEETINGS.
5.11.1 Upon execution of this Agreement by Owner and
Contractor, Contractor will provide to Owner for review a preliminary, interim
schedule (the "Preliminary Schedule") for the performance of the Work which
shall include a Preliminary Schedule of values. Owner shall provide any comments
on the Preliminary Schedule to Contractor within five (5) days after submission
to Owner for review. Within thirty (30) days thereafter, Contractor will update
the Preliminary Schedule and submit to Owner for review (a) a project schedule
for the Work, with the proper and reasonable activity sequences and durations
required to meet the Mechanical Completion Date (the "Project Schedule"), and
(b) a Schedule of Values for payment purposes, which Schedule of Values shall be
subject to Owner's approval as specified in Section 6.5.
5.11.2 During the performance of the Work, Contractor
shall submit the following periodic reports to Owner unless otherwise directed
by Owner:
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5.12 A computerized PROJECT SCHEDULE. This schedule shall be based upon
the Critical Path Method, shall be prepared by Contractor and submitted to Owner
for review. This schedule shall be prepared using the SureTrak software and
parties agree that such is acceptable.
5.12.1 The schedule shall set forth and reflect the
utilization of Contractor's resources required to perform the Work, the logical
sequence of design, procurement and construction activities, appropriate
interfaces between activities, Project key dates and necessary interfaces with
Subcontractors. The schedule shall contain the various activities required to
perform the Work and the dates the activities shall be started and completed in
order to complete the Work by the Mechanical Completion Date.
5.12.2 One reproducible drawing of the Project Schedule
shall be submitted to Owner with each update.
5.12.3 Contractor shall use reasonable efforts to maintain
such schedule; provided, however that Contractor shall have the right to adjust
such schedule, and the sequence, activities and logic utilized in such schedule,
in any manner Contractor believes is necessary or appropriate to achieve
Mechanical Completion by the Mechanical Completion Date.
5.13 A CONTRACT PROGRESS CHART which combines the manhours and schedule
activities to form a basis to monitor progress. This is a graphic representation
showing schedule and actual manpower curves and progress curves, and schedule
and actual progress percentages for major activities. This document shall be
updated and issued monthly utilizing an Owner-approved form.
5.13.1 If a submitted Project Schedule reflects a slippage
in the projected Mechanical Completion Date, a narrative report shall accompany
said schedule indicating the cause of the delay and describing the corrective
action which shall be taken to improve the schedule in order to meet the
required Mechanical Completion Date. The Project Schedule shall be revised and
updated by Contractor accordingly and submitted to Owner for review.
5.14 DELAYS. In the event of any delay or hindrance to Contractor not
authorized by this Agreement which is due to a Force Majeure Event or is caused
by Owner, or by any other of Owner's separate contractors, and which Contractor
29
believes has delayed or hindered the performance of the Work, Contractor shall
give written notice in accordance with ARTICLE 7 hereof and submit in writing a
request for such extension of time and increase in the Contract Price as
Contractor believes is justified utilizing the most recent update of the Project
Schedule.
5.15 TIME EXTENSIONS OR ADJUSTMENTS.
5.15.1 Except as otherwise provided in the Contract
Documents, the Mechanical Completion Date may only be changed by a Change Order.
5.15.2 The parties hereto acknowledge and agree that the
only contractually mandated date is the Mechanical Completion Date. Contractor
acknowledges and agrees that the Mechanical Completion Date will not be adjusted
or modified if at all possible, except in accordance with the Contract
Documents.
5.15.3 The parties agree that the Project Schedule is a
plan or estimate for Contractor's Work which may be revised from time to time by
Contractor; that the general flow of the Work and the duration and sequence of
the various activities are flexible and that the schedule will be subject to
revision by Contractor as conditions warrant or require; and that all such
revisions shall be in accordance with the requirements of this Agreement and
consistent with Contractor's obligations and responsibilities to Owner and
separate contractors under this Contract. Contractor agrees that should
conditions or Changes in the Work occur which delay any portion of the Work,
Contractor will, to the extent practicable and reasonable, take prompt and
timely action, in compliance with the requirements of this ARTICLE 5, to adjust
or modify the sequence of the Work and the duration of activities therefor; the
goal of such action shall be to absorb or adjust for the effect of any such
condition or Change in order that no adjustment will be required to the
Mechanical Completion Date if Contractor is reasonably able to do so without
additional cost or liability to Contractor. The burden of substantiating a claim
for an extension of time shall rest with Contractor.
5.16 FORCE MAJEURE EVENTS.
5.16.1 Force Majeure Event. Neither party hereto shall be
considered to be in default in performance of any obligation hereunder if
failure of performance shall be due to a Force Majeure Event. For the purposes
of this Agreement, the term "Force Majeure Event" shall mean any cause beyond
the control of the party affected, including, but not limited to, flood,
earthquake, storm, fire, lightning, epidemic, war, riot, civil disturbance,
30
labor disturbance, sabotage, and restraint by court order or public authority,
which by exercise of due foresight such party could not reasonably have been
expected to avoid, and which by exercise of due diligence it is unable to
overcome. Neither party shall, however, be relieved of liability for failure of
performance if such failure is due to causes arising out of its own negligence
or to removable or remediable causes that it fails to remove or remedy with
reasonable dispatch. Nothing contained herein, however, shall be construed to
require either party to prevent or settle a strike or other labor disturbance.
5.16.2 Burden of Proof. In the event that the parties are
unable in good faith to agree that a Force Majeure Event has occurred, in any
proceeding to resolve the dispute the burden of proof as to whether a Force
Majeure Event has occurred shall be upon the party claiming a Force Majeure
Event.
5.16.3 Excused Performance. If either party is rendered
wholly or partially unable to perform its obligations under this Agreement
because of a Force Majeure Event, except for the obligation to pay money, that
party will be excused from whatever performance is affected by the Force Majeure
Event to the extent so affected; provided that:
5.17 The nonperforming party gives the other party prompt notice
describing the particulars of the occurrence, including an estimation of its
expected duration and probable impact on the performance of such party's
obligations hereunder, and, upon reasonable request, provides periodic reports
with respect thereto during the continuation of the Force Majeure Event;
5.18 The suspension of performance shall be of no greater scope and of
no longer duration than is reasonably required by the Force Majeure Event;
5.19 The nonperforming party shall exercise all reasonable efforts to
mitigate or limit damages to the other party;
5.20 The nonperforming party shall exercise all reasonable efforts to
continue to perform its obligations hereunder and to correct or cure the event
or condition excusing performance; and
5.21 When the nonperforming party is able to resume performance of its
obligations under this Agreement, that party shall give the other party written
notice to that effect and shall promptly resume performance hereunder.
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5.22 Notwithstanding anything contained herein to the contrary, delays
that are caused directly and primarily by Owner shall be deemed to be
suspensions pursuant to the provisions of ARTICLE 9 for which Contractor shall
be entitled to extensions in the time of performance and to compensation for any
additional costs incurred as a result therefrom.
5.23 UPDATED PROJECT SCHEDULE. Any time extension granted under this
ARTICLE 5 shall be included in Contractor's latest update of the Project
Schedule and the schedule adjusted appropriately thereby.
5.24 NO RELEASE. No extension of time granted under this ARTICLE 5
shall relieve Contractor from full responsibility for compliance with all of the
requirements of the Contract Documents, nor shall it be deemed a waiver by Owner
of its right to terminate this Agreement for default of Contractor.
5.25 TIME EXTENSIONS AFTER FINAL PAYMENT. No claim by Contractor for a
time extension under this Agreement shall be valid or allowable if asserted
after Final Payment.
5.26 ADJUSTMENT TO CONTRACT PRICE. In the event that an extension of
time is granted pursuant to Section 5.6, in whole or in part, and Contractor
incurs additional actual costs as a direct result of the delay or hindrance,
Owner shall increase the Contract Price and issue Change Orders to reflect such
additional costs.
5.27 PROGRESS. Contractor shall keep Owner reasonably advised in
advance as to its plans for performing each part of its Work. If at any time
Contractor's progress is inadequate to meet the requirements of the Contract
Documents, Owner may so notify Contractor who shall thereupon take such steps as
may be necessary to improve its progress. Neither such notice by Owner nor
Owner's failure to issue such notice shall relieve Contractor of its obligation
to achieve the quality of Work and rate of progress required by the Contract
Documents.
ARTICLE 6 COMPENSATION
6.1 CONTRACT PRICE. Owner agrees to pay Contractor as compensation of
Contractor hereunder for the performance of the Work the fixed price of FIFTEEN
MILLION SIX HUNDRED THOUSAND DOLLARS ($15,600,000) (the "Contract Price").
Except as otherwise provided herein, in the event the costs and expenses
incurred by Contractor for the Work hereunder exceed the Contract Price,
Contractor shall be solely responsible and liable for such excess costs and
32
expenses and shall not be entitled to any additional reimbursement or
compensation from Owner, and Owner shall not be liable or responsible to
Contractor or any third party for such excess costs and expenses.
6.2 OPERATION BONUS. Owner acknowledges that except as expressly
provided in the Work Scope, Contractor has and does not provide any process
guaranties or warranties concerning the production of the Project.
Notwithstanding the lack of such guaranties and warranties, in addition to the
Contract Price, Contractor shall be entitled to receive from Owner an amount
equal to TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000) (the "Operation Bonus")
once the Project has operated as set forth in this Section 6.2 for one hundred
twenty (120) Operating Days (the "Operation Period"). For the purposes hereof,
the term "Operating Days" means the aggregate of all days on which the Project
is in operation or could have been in operation commencing on the date the
Project first processes material. Operating Days need not be consecutive but
specifically exclude any downtime due to ordinary repairs or maintenance or
repairs and maintenance attributable to Contractor's performance of the Work.
Any day on which the Project does not operate due to reasons not attributable to
ordinary repairs and maintenance or Contractor's performance of the Work shall
be deemed to be Operating Days for the purposes of this Section 6.2.
Notwithstanding the foregoing, for a day to be an "Operating Day," the Project
must operate in accordance with the Design Criteria set forth in the Work Scope,
as such Design Criteria may have been modified as provided herein, and the
Project must achieve, or be capable of achieving, the designed outputs as to
both quality and quantity unless attributable to causes unrelated to the
Project.
6.3 PAYMENT. Partial payments of the Contract Price will be made to
Contractor for applications for payment received in an amount equal to
ninety-five percent (95%) of the cost of the Work completed by Contractor, less
the aggregate of previous payments. Five percent (5%) of such invoices (the
"Retention") shall be withheld by Owner to secure faithful performance of
Contractor's obligations hereunder. Subject to the terms and conditions hereof,
the Retention shall be paid to Contractor at the time of Final Payment. All
amounts paid to Contractor prior to the effective date hereof for any services
and work related to the Project or under the Services Agreement dated December
3, 1996 (the "Service Agreement") shall not be applied toward or reduce any
amount due hereunder to Contractor.
6.4 TIME OF PAYMENT. Partial payments described in Section 6.3 hereof
shall become due to Contractor fifteen (15) days after submission to Owner of a
proper application for payment. Partial payment to Contractor shall not operate
as an approval or acceptance of Work furnished pursuant to this Agreement.
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6.5 SCHEDULE OF VALUES. Before the first application for payment
hereunder Contractor shall submit to Owner for approval a preliminary schedule
of values allocated to the various portions of the Work. The schedule of values
shall be prepared in such a manner that each major item of the Work (including
engineering) and each subcontracted item of the Work is shown as a separate line
item. This schedule shall be used as a basis for reviewing applications for
payment and may be updated from time to time by mutual agreement of the parties
based on the progress of the Work. Within five (5) Business Days after receipt
by Owner of the Schedule of Values, or any proposed amendment thereto, Owner
shall either approve such Schedule of Values or provide Contractor with written
notice of Owner's objections to such Schedule.
6.6 APPLICATIONS FOR PAYMENT.
6.6.1 All applications for payment shall be submitted on a
bi-weekly basis. Review by Owner of Contractor's application for payment shall
be accomplished within ten (10) days after its receipt. Owner acknowledges that
timely payment is a material part of the consideration of this Agreement. Owner
may, as a condition precedent to any payment to Contractor, require Contractor
to submit complete waivers or releases of any and all claims (except for
retention if any) of any person, firm or corporation providing services,
equipment or materials through the date of such application in connection with
or in any way related to the performance of this Agreement, conditioned on
payment of the amounts included in such application. When required, Contractor
shall, in addition, furnish acceptable evidence that all such claims have been
satisfied. Owner shall pay an additional charge of one percent (1%) of the
invoiced amount per month for any payment not paid to Contractor when due (as
determined under ARTICLE 13 in case of dispute), including any amounts
improperly withheld for any reason pursuant to the terms hereof. In the event
any such application for payment has not been paid, or contested in good faith
as provided in ARTICLE 13, within fifteen (15) days after its due date,
Contractor shall have the right to suspend performance of the Work and such
suspension shall be considered to be a compensable delay by Owner. In the event
any such application for payment has not been paid within sixty (60) days after
its due date, Contractor shall have the right to terminate this Agreement unless
it receives payment in full of such application for payment within ten (10) days
after written demand therefore, and such termination shall be treated as if
Owner terminated for convenience pursuant to Section 12.2 hereof. Such
suspension and/or termination shall not limit or otherwise affect Contractor's
right to pursue any other remedies available at law or in equity. The provisions
of this Section 6.6.1 are subject to the dispute resolution procedures set forth
in ARTICLE 13 hereof.
6.6.2 Each application for payment shall be accompanied
by a certification signed by Contractor certifying to the effect that, except as
previously disclosed to Owner: (a) there are no known claims, liens, security
interests or encumbrances in the nature of mechanics' or materialmen's liens or
34
claims or otherwise arising out of or in connection with the performance by
Contractor or any Subcontractor of the Work outstanding or known to exist at the
date of the application for payment; (b) all due and payable bills with respect
to the Work have been paid to date or will be paid from the proceeds of the
application for payment, and (c) releases, assignments and/or waivers from all
Subcontractors for Work done and materials furnished for which payment has been
made by Owner to Contractor have been obtained in such a form as to constitute
an effective waiver of all such liens and claims under the Laws of the State of
Utah to the extent of payments made therefor by Owner and shall be delivered to
Owner together with a similar release and waiver signed by Contractor.
6.6.3 Contractor warrants and guarantees that title to all
Work, materials and equipment covered by an Application for Payment, whether
incorporated in the Project or not, shall pass to Owner to the extent of receipt
by Contractor of payment therefore, free and clear of all liens, claims,
security interests or encumbrances.
6.6.4 Contractor shall submit the original of applications
for payment to:
Crown Asphalt Ridge, L.L.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: Accounts Payable
6.6.5 Any amount otherwise payable under this Agreement
may be withheld, in whole or part, if either:
6.7 Contractor is in material default of any agreement covenant,
obligation or condition set forth in this Agreement;
6.8 Contractor becomes insolvent or files or has filed against it a
petition for rearrangement, composition or compromise with its creditors under
applicable Laws;
6.9 Contractor fails to timely remedy defective Work; or
6.10 Contractor fails to timely pay when due any Subcontractor for any
Work properly performed on the Project.
Before any amount may be withheld from any payment to Contractor,
Owner shall advise Contractor in writing as to the reasons for such deduction,
the amount to be withheld, and the reasonable steps which, if taken by
Contractor, will result in the release of such withholding and shall meet with
35
Contractor in a good faith effort to resolve any such reason for withholding.
Owner shall pay when due the portion of any invoice that is not in dispute, and
shall pay any disputed amounts as provided in ARTICLE 13. Owner shall pay to
Contractor any amounts withheld under this Section 6.6.5 if Contractor cures the
defaults in its performance that formed the basis for such withholding.
6.11 PAYMENT OF SUBCONTRACTORS. Contractor shall promptly pay each
Subcontractor the amount to which any such Subcontractor is entitled. Contractor
shall indemnify and hold harmless Owner from any loss, cost, expense (including
but not limited to reasonable attorneys' fees) or liability arising from
Contractor's breach of this Section 6.7. Contractor shall, by an appropriate
agreement with each Subcontractor, require each Subcontractor to make payments
to their respective Subcontractors in a similar manner.
6.12 LIENS AND CLAIMS. At the time of each payment of Contractor's
application for payment hereunder, Contractor shall provide to Owner sufficient
documentation to establish that there are no mechanics', labor or materialmen's
liens or other claims, liens, security interests or encumbrances filed against
the Project, the Site and any and all interests and estates therein or any
improvements or materials placed on the Site, or if such matters exist,
Contractor shall endeavor to promptly have any such lien released by bond or
otherwise and deliver to Owner evidence of such release. If any such lien or
claim of lien is filed, Owner may withhold from the next payment invoiced by
Contractor, the final payment or other amount payable to Contractor under this
Agreement, an amount sufficient to discharge any or all such liens or claims. If
after thirty (30) days from the time such lien or claim is made, Contractor has
not discharged or bonded over such lien or claim, Owner may discharge such lien
or claim with the moneys withheld, whereupon for purposes of this Agreement such
moneys shall be deemed to have been paid to Contractor hereunder.
6.13 PAYMENT OR USE NOT ACCEPTANCE. No payment of an application for
Payment or other payment to Contractor or any use of the Project by Owner shall
constitute an acceptance of any of the Work and other work to be performed
hereunder furnished by Contractor hereunder or shall relieve Contractor of any
of its obligations or liabilities with respect thereto.
6.14 FINAL PAYMENT. Unless Owner determines to release a portion of the
Retention prior to Final Acceptance, Owner will make final payment of the
balance of the Contract Price due under this Agreement, including any remaining
Retention, (the "Final Payment") to Contractor within fifteen (15) days after
Final Acceptance. Final Payment to Contractor shall not release Contractor or
any surety from their obligations hereunder. Before issuance of Final Payment,
Owner may request satisfactory evidence that all payrolls, materials bills and
other indebtedness connected with the Work have been paid or otherwise
satisfied.
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6.15 OPERATION BONUS PAYMENT. The Operation Bonus shall be promptly
paid to Contractor within fifteen (15) days after the end of Operation Period
provided for in Section 6.2 hereof.
ARTICLE 7 CHANGES IN THE WORK
7.1 MINOR CHANGES. Owner may request minor Changes in the Work
consistent with the purpose of Work and not involving extra expense to or
additional time for performance by Contractor. Contractor shall make such minor
Changes in the Work at no additional cost to Owner and without any time
adjustment for the performance thereof.
7.2 VALUE CHANGE ORDERS. Contractor may from time to time during the
course of the Work request changes in the Work, submit capital cost savings
ideas and suggestions to Owner. If accepted by Owner, such ideas and suggestions
shall be deemed to be "Value Change Orders" and shall entitle Contractor to a
Change Order that includes the cost of engineering services related to such
Value Change Order in addition to the capital cost of such change. In the event
that the agreed upon projected capital cost reduction anticipated from such
change is not realized, Contractor will not be entitled to recover the cost of
such additional engineering services. The amount payable by Owner for such
additional engineering services shall be determined as contemplated by ARTICLE 8
or as is mutually agreed upon in the Change Order. Any capital cost savings from
a Value Change Order shall be shared seventy percent (70%) by Owner and thirty
percent (30%) by Contractor, and shall be implemented by Change Order.
7.3 PROCEDURE FOR CHANGE ORDERS. When Contractor becomes aware of any
circumstances that Contractor believes will necessitate a change in the Contract
Documents, an increase in the Contract Price or a change to the Contract Time
(each a "Change"), Contractor shall notify Owner (each, a "Change Order
Notice"). All Change Order Notices shall include documentation reasonably
sufficient to enable Owner to determine (i) the factors necessitating the
possibility of a Change; (ii) the impact that the Change is likely to have on
the Contract Price; (iii) the impact that the Change is likely to have on
scheduling and the Mechanical Completion Date; and (iv) such other information
as Owner may reasonably request in connection with such Change. If Owner desires
to make a Change, it shall submit a "Change Order Request" to Contractor.
Contractor shall promptly review the Change Order Request and notify Owner in
writing of the options for implementing the proposed Change (including, if
practicable any option that does not involve an extension of time) and the
effect, if any, each such option would have on the Contract Price, the
Mechanical Completion Date, the Project Schedule, and any warranties or
guaranties. Contractor shall provide Contract Price, schedule and performance
guaranty impacts to Owner for Changes proposed by Owner. Owner may, but shall
not be obligated to, issue a written order covering such proposed Change (each,
a "Change Order"), in which event the contents of Contractor's notice described
37
in this Section 7.3 shall be binding on Contractor. In the event Owner disagrees
with Contractor's statement of the effect of such Change on the Contract Price,
the Mechanical Completion Date, the Project Schedule, or the warranties or
guaranties, Owner may proceed with issuance of the Change Order while the
dispute is being resolved.
7.4 CONTINUED PERFORMANCE PENDING RESOLUTION OF DISPUTES.
Notwithstanding a dispute regarding the amount of any increase or decrease in
the Contract Price with respect to a Change, Contractor shall proceed with the
performance of such Change promptly following Owner's execution of the
corresponding Change Order. Until any such dispute is settled by an amendment to
the Contract Price, Contractor shall be entitled to payments on a time and
material basis as set forth in ARTICLE 8 and the rates and policies set forth
therein. Except in the event of an emergency or minor Changes, Contractor shall
not be obligated to put Changes into effect until the Contract Price has been
adjusted by mutual agreement in writing, in accordance with the provisions of
Section 7.3 or Owner has confirmed in writing the obligation of Owner to pay
Contractor on a time and materials basis as set forth in the immediately
foregoing sentence.
7.5 EFFECT OF FORCE MAJEURE EVENT. In the event and to the extent that
a Force Majeure Event affects Contractor's ability to meet the Mechanical
Completion Date, an equitable adjustment in such date and an adjustment due to
Contractor's actual and demonstrated costs caused thereby shall be made by
agreement of Owner and Contractor as provided in Sections 5.7 and 5.10.
7.6 DOCUMENTATION. All claims by Contractor for adjustments to one or
more of the Contract Price, the Mechanical Completion Date, the Project
Schedule, and the any warranties or guaranties as a result of Changes under this
ARTICLE 7 shall be supported by such documentation as is reasonably sufficient
for Owner to determine the accuracy thereof.
Contractor shall keep and require each of its Subcontractors, if any,
to keep, at no additional cost to Owner, full and detailed accounts of costs
chargeable to Owner on a time and material basis under any Change Order. During
the Project, and for one (1) year following Mechanical Completion of the Work,
Owner or its authorized representatives shall be afforded full access to such
accounts, records, and supporting documents for audit, copy (such copies will be
property of Owner), and verification of such costs. Contractor or Owner shall
remit promptly to the other party the amount of any adjustment resulting from
audit.
7.7 NOTICE OF CHANGE. Owner shall have the right, at any time and from
time to time, to make Changes in the Work, including either extra related Work
or deletions therefrom. When notified by Owner that a Change will occur,
Contractor shall discontinue Work on that portion of the Work to be changed,
unless otherwise specifically instructed by Owner in the notice of Change.
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7.8 UNKNOWN CONDITIONS. Contractor shall promptly after discovery, and
before such conditions are further disturbed, notify Owner in writing of: (1)
subsurface or latent physical conditions at the Site differing materially from
those indicated in the Contract Documents, or (2) unknown physical conditions at
the Site, of an unusual nature, materially differing from those ordinarily
encountered and generally recognized as inherent in Work of the character
provided for in this Agreement. To the extent practicable, Contractor shall
provide such notice the same day that Contractor becomes aware of such
conditions. Owner shall promptly investigate the conditions. If such conditions
increase or decrease Contractor's cost of performing the Work, or time required
for performance of any part of the Work, Owner and Contractor shall reasonably
negotiate a Change, as appropriate, to the Contract Time and the Contract Price.
7.9 PAYMENT FOR CHANGE ORDERS. Unless otherwise indicated in a Change
Order or agreed to in writing by the parties hereto, the amount of a Change
Order shall be (a) paid in the manner and as provided in ARTICLE 6 hereof, and
(b) included in the calculations for progress payments under Section 6.3 hereof.
Disputed Change Orders will be paid in the manner provided in ARTICLE 13 hereof.
ARTICLE 8 COST OF THE WORK FOR CHANGE ORDERS
Wherever the terms of this Agreement require the calculation of the
cost of the Work for a Change Order, the following provisions shall apply:
8.1 COST OF DESIGN & ENGINEERING SERVICES. Contractor's design and
engineering costs shall be calculated on the basis of manhours expended
multiplied by the Rate Schedule set forth in Schedule C hereto which manhours
are subject to an audit by Owner in accordance with generally accepted auditing
standards should a dispute arise between the parties relating thereto.
8.2 CONSTRUCTION LABOR AND OTHER COST ITEMS. Contractor shall
be paid for the following costs, without duplication, for the performance
of the Additional Work:
8.2.1 Direct Labor Cost. Payment shall be made for all
field classifications up to and including foremen, superintendents. resident
construction manager, general superintendent, assistant superintendents, general
foremen, safety representatives, surveyors, office personnel, field engineers,
time-keepers, maintenance mechanics, and similar field personnel, plus fifteen
percent (15%) of such cost.
8.3 The cost for direct labor of Contractor, includes:
39
8.4 The cost of industrial accident or Worker's Compensation and
Occupational Disease Insurance.
8.5 The cost of social security taxes and unemployment compensation
insurance and all other statutory costs.
8.6 The additional costs of Contractor's Fringe Benefit package.
8.7 Per diem and overtime costs. The Contract Price is based on a 40
hour week and per diem for each field employee.
8.7.1 Contractor Equipment. A valuation for each item of
construction equipment delivered to the Project shall be established and agreed
to by Owner based upon ninety percent (90%) of the K-III Rental Rate for
Construction Equipment owned by Contractor. For new equipment, such agreed
valuation shall be either Contractor's original cost less allowed depreciation
or the appraised evaluation of an independent insurance appraiser obtained at
Contractor's expense, whichever is greater. Cost for equipment will include
mobilization, demobilization, use costs, replacement costs for normal and
required use of equipment.
8.7.2 Materials and Third-Party-Owned Construction
Equipment Costs. Payment for the cost of materials and/or third-party-owned
construction equipment furnished by Contractor shall be made, provided such
furnishing and use of materials was specifically authorized. For all such
materials, Contractor shall be paid the actual cost of such material, including
the transportation charges, plus ten percent (10%) of such costs. The charges
for third-party-owned construction equipment shall be at local and prevailing
rates, plus ten percent (10%) of such rates. Vendor's invoice or acceptable
substitute shall accompany the billing along with the verification by Contractor
of use of such materials.
8.7.3 Tools and Consumables. In lieu of payment for tools
and equipment with a new cost of Seven Hundred and Fifty Dollars (US $750.00) or
less each, and for consumables, Contractor shall be paid an amount equal to
eight percent (8%) of the actual direct labor cost of wages as defined in
Section 8.2.1.
8.7.4 Reasonable transportation, travel, hotel and moving
expenses of Contractor's personnel incurred in connection with the
Additional Work.
8.7.5 Cost of all materials, supplies and equipment
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incorporated in the Work, including costs of inspection, testing,
transportation, storage and handling, plus ten percent (10%) of such costs.
8.7.6 Cost of the premiums for any additional insurance
for Contractor for the performance of the Change or extra work, or any increased
surety bond premium necessitated by the Change or extra work, unless otherwise
paid by Owner.
8.7.7 Sales, use, gross receipts or other taxes, tariffs
or duties related to the Additional Work for which Contractor is liable.
8.7.8 Permits, fees, licenses, tests, royalties, damages
for infringement of patents and/or copyrights, including costs of defending
related suits for which Contractor is not responsible under this Agreement and
deposits lost for causes other than Contractor's fault or negligence.
8.7.9 All costs associated with establishing, equipping,
operating, maintaining and demobilizing the field office.
8.7.10 Reproduction costs, photographs, cost of telegrams,
facsimile transmissions, long distance telephone calls, data processing
services, postage, express delivery charges, telephone service at the Site and
reasonable ▇▇▇▇▇ cash expenses at the field office.
8.7.11 All water, power and fuel costs necessary for the
Additional Work.
8.7.12 Cost of removal of all Hazardous Materials and
nonhazardous substances, debris and waste materials, plus ten percent (10%) of
such costs.
8.7.13 Costs incurred due to an emergency affecting the
safety of persons and/or property, plus ten percent (10%) of such costs.
8.8 DISCOUNTS. All discounts for prompt payment shall accrue to Owner
to the extent such payments are made directly by Owner. To the extent payments
are made with funds of Contractor, all cash discounts shall accrue to
Contractor. All trade discounts, rebates and refunds, and all returns from sale
of surplus materials and equipment, shall be credited to the cost of the
Additional Work.
ARTICLE 9 SUSPENSION OF THE WORK BY OWNER
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9.1 SUSPENSION. Owner may, upon forty-eight (48) hours written notice
to Contractor, order Contractor to suspend, delay, or interrupt all or any part
of the Work without cause for such period of time as Owner may determine to be
appropriate for its convenience. Such notice of suspension of Work will
designate the amount and type of plant, labor and equipment to be committed to
the Site. During the period of suspension, Contractor shall use commercially
reasonable efforts to utilize its plant, labor, and equipment in such a manner
as to minimize costs associated with suspension. Upon receipt of any such
notice, unless the notice requires otherwise, Contractor shall:
9.1.1 Promptly discontinue the Work subject to the notice
on the date and to the extent specified in the notice;
9.1.2 Place no further orders or subcontracts for
material, services, or facilities with respect to suspended work except to the
extent required in the notice;
9.1.3 Promptly make every reasonable effort to obtain
suspension, upon terms satisfactory to Owner, of all orders, subcontracts, and
rental agreements to the extent they relate to performance of Work suspended;
9.1.4 Continue to protect and maintain the Work including
those portions on which work has been suspended;
9.1.5 Take such other action(s) to mitigate Contractor's
costs as Owner approves in writing;
9.1.6 As full compensation for such suspension, Contractor
shall be reimbursed for the following costs, reasonably incurred, without
duplication of any item, to the extent that such costs directly result from such
suspension of Work;
9.2 A standby charge to be paid to Contractor during the period of
suspension of work, which standby charge shall be sufficient to compensate
Contractor for keeping, to the extent required in the notice, its organization
and equipment committed to the work in a standby status;
9.3 All reasonable costs associated with mobilization and
demobilization of the plant, labor forces and equipment of Contractor and its
Subcontractors;
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9.4 An equitable amount to reimburse Contractor for the cost of
maintaining and protecting that portion of the Work which work has been
suspended; and
9.5 If, as a result of any such suspension of the Work, the cost to
Contractor of later performing the Work is increased or decreased, an equitable
adjustment shall be made in the cost of performing the remaining portion of Work
and the applicable portion of the Contract Price.
9.6 RESUMPTION OF WORK. Upon receipt of notice to resume suspended
work, Contractor shall promptly resume performance of the suspended work to the
extent required in the notice. Any claim on the part of Contractor for time or
compensation relating to the suspension of work shall be waived if not presented
to Owner in writing within ten (10) days after receipt of notice to resume work,
and Contractor shall, within the same ten (10) days, submit for review a revised
construction schedule.
9.7 EFFECT OF BREACH. Neither compensation or extension of time shall
be granted if suspension results from Contractor's breach of requirements of
this Agreement.
ARTICLE 10 INDEMNIFICATION
10.1 CONTRACTOR'S INDEMNIFICATION.
10.1.1 Subject to Section 11.5.2, Contractor agrees to
indemnify, defend, and save Owner, and its officers, members, agents, employees,
successors and assigns (collectively the "Owner Indemnified Parties") harmless
from and against any and all loss and expense, including attorneys' fees and
other legal expense, by reason of liability imposed or claimed to be imposed by
Law upon Owner Indemnified Parties on the basis of any theory of strict
liability for the performance by, or for the negligent acts or omissions of,
Contractor, its employees, agents or Subcontractors, in the performance of the
Work, including, but not limited to: (a) damage related to of bodily injuries,
including death at any time resulting therefrom, sickness, disease or infection
(collectively "Bodily Injuries"); (b) damage to property, sustained by any
person or persons, to the extent such Bodily Injuries or property damage arise
out of any such act or omission during the undertaking of or otherwise directly
and arising out of, incident or relating to the performance of the Work; (c)
damage or liability arising in whole or in part, through any such act or
omission, or civil or criminal violations, in failing to comply with applicable
Laws, and (d) any claim arising out of the breach of any obligation by
Contractor or any Subcontractor of obligations or responsibilities to employees
performing any portion of the Work or violation by Contractor or Subcontractors
of any labor or safety standards applicable to the Work.
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10.1.2 Notwithstanding the requirements of the foregoing
Section 10.1.1, Contractor shall have no obligation to indemnify Owner
Indemnified Parties for any pro rata liability imposed upon Owner Indemnified
Parties for damage, loss or expense, including attorneys' fees and other legal
expense, arising by reason of liability imposed or claimed to be imposed by Law
arising out of or relating to any negligent act or omission, strict liability or
criminal violations of any Owner Indemnified Party or of Owner's separate
contractors or their agents or employees; provided, however, that this provision
does not relieve Contractor of Contractor's pro rata liability under the
indemnity provisions hereof.
10.2 OWNER'S INDEMNIFICATION.
10.2.1 Subject to Section 11.5.2, Owner agrees to
indemnify, defend, and save Contractor, and its officers, members, agents,
employees, successors and assigns (collectively, the "Contractor Indemnified
Parties") harmless from and against any and all loss and expense, including
attorneys' fees and other legal expense, by reason of liability imposed or
claimed to be imposed by Law upon Contractor Indemnified Parties on the basis of
any theory of strict liability for the performance by, or for negligent acts or
omissions of, the Owner Indemnified Parties in the performance of the Work,
including, but not limited to: (a) damage because of Bodily Injuries; (b) damage
to property, sustained by any person or persons, to the extent such Bodily
Injuries or property damage arise out of any such act or omission during the
undertaking of or otherwise directly and arising out of, incident or relating to
the performance of the Work; (c) damage or liability arising in whole or in
part, through any such act or omission, or civil or criminal violations by any
Owner Indemnified Party in failing to comply with applicable Laws, and (d) any
claim arising out of the breach of any obligation by any Owner Indemnified Party
of obligations or responsibilities to employees or violation by any Owner
Indemnified Party of any labor or safety standards applicable to the Work.
10.2.2 Notwithstanding the requirements of the foregoing
Section 10.2.1, Owner shall have no obligation to indemnify the Contractor
Indemnified Parties for any pro rata liability imposed upon any of the
Contractor Indemnified Parties for damage, loss or expense, including attorneys'
fees and other legal expense, arising by reason of liability imposed or claimed
to be imposed by Law arising out of or relating to the negligent act or
omission, criminal violations or strict liability of any Contractor Indemnified
Party or their agents or employees; provided, however, that this provision does
not relieve Owner of Owner's pro rata liability under the indemnity provisions
hereof.
10.2.3 Owner shall indemnify, defend and hold harmless
Contractor from and against any claim that the Project violates or infringes on
any property right derived from the patented rights of Dr. Park ▇▇▇▇▇▇.
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10.3 CLAIM PROCEDURE. Promptly after receipt by any Indemnified Party
under this ARTICLE 10 of notice of any claim or the commencement of any action,
said Indemnified Party shall notify the indemnifying party in writing of the
claim or the commencement of said action; provided that the failure to notify
the indemnifying party shall not relieve indemnifying party from any liability
which it may have to an Indemnified Party otherwise under this ARTICLE 10 unless
such failure prejudices the indemnifying party's ability to perform its
obligations under this ARTICLE 10. If any such claim shall be brought against an
Indemnified Party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein, and to assume the
defense thereof with counsel satisfactory to the Indemnified Party and to settle
and compromise any such claim or action. After notice of its election to assume
the defense of such claim or action, the indemnifying party shall not be liable
to the Indemnified Party under this ARTICLE 10 for any legal or other expenses
subsequently incurred by such Indemnified Party in connection with the defense
thereof.
10.4 NO LIMITATION. The provisions of the ARTICLE 10 shall not limit or
otherwise affect the rights and remedies of the parties not otherwise limited by
this Agreement and available at law or in equity.
ARTICLE 11 INSURANCE AND WAIVER OF SUBROGATION
11.1 CONTRACTOR'S INSURANCE.
11.1.1 General Requirement. During the Contract Time and
at all times during the performance and until completion of the Work,
Contractor, and its Subcontractors at any tier, shall each severally provide and
maintain at its own expense the insurance required by this Section 11.1 for the
benefit of Contractor performing Work at the Site and for the benefit of Owner
and its affiliated corporations; such insurance is to continue in force until
Final Acceptance.
11.1.2 No Owner Insurance. Except for the Builders Risk
Policy contemplated by Section 11.2 hereof, insurance shall not be provided by
Owner for Contractor, its Subcontractors, suppliers, service organizations,
testing companies, engineers, consultants or anyone else under contract with
Contractor. Contractor shall be solely responsible for procuring and maintaining
the following insurance coverage for all Work provided hereunder.
11.1.3 Specific Requirements. During the Contract Time,
Contractor and all Subcontractors shall maintain in force the following
insurance with companies with an "A" or better rating by A.M. Best Company,
unless otherwise agreed, and with policies written in a form acceptable to
45
Owner; provided, however, that Contractor and all Subcontractors may, at their
discretion, maintain insurance in addition to or in excess of the limits set
forth herein:
(a) Professional Liability Insurance. Contractor shall
provide, for Owner's protection professional liability insurance for claims
arising from the negligent performance of the design and engineering services
provided under this Agreement shall be written for not less than $1,000,000 per
claim and in the aggregate. These requirements shall be continued in effect for
three (3) year(s) after the Mechanical Completion Date. If Contractor retains
consultants or Subcontractors who provide design or engineering services, said
entities shall carry professional liability insurance coverage in the foregoing
sums unless Owner, in its sole discretion, lessens or waives this requirement in
writing for a specific design or engineering professional or Subcontractor.
(b) Worker's Compensation and Occupational Disease
insurance in compliance with applicable Law in the jurisdiction where the Work
and services are to be performed, including the following special coverage
extensions:
(I) Employers Liability coverage with limits of not less
than per $1,000,000 per accident;
(ii) "Borrowed Servant" endorsement providing that a
Worker's Compensation claim brought against Owner by a Contractor's employee
shall be treated as a claim against Contractor;
(iii) Premiums and any and all return premiums for
Worker's Compensation insurance and other applicable insurance and dividends
earned thereunder, shall belong to and be payable to Contractor.
(c) Commercial General Liability insurance with per
occurrence limit, subject to an annual $18,000,000 total aggregate for
Contractor, for bodily injury and property damage, including the following
coverage extensions:
(I) Contractual liability covering the liability
assumed in this Agreement;
(ii) Completed operations coverage which shall
46
continue in force for a period of three (3) years following Mechanical
Completion of the Work;
(iii) Comprehensive Automobile Liability insurance
including all owned, non-owned, and hired vehicles, with not less than the
following limits:
Bodily Injury
_ $2,000,000 combined single limit
Property Damage per occurrence
11.1.4 Special Provisions. All policies of insurance
carried by Contractor and its Subcontractors pursuant to this Section 11.1 shall
(a) provide that they may not be canceled or the protection afforded thereby
substantially changed without thirty (30) days prior written notice to Owner and
(b) contain endorsements stating that Contractor's/Subcontractor's coverage is
primary to any coverage Owner may elect to carry for its own account, or for
Contractor or its Subcontractors. The policies required under Section 11.1.3(c)
shall be endorsed to name Owner, MCNIC Pipeline & Processing Company, Crown
Asphalt Corporation and their respective members, subsidiaries and associated
and affiliated companies, as additional insureds with respect to items for which
indemnification is provided by Contractor pursuant to ARTICLE 10 hereof.
Contractor and Subcontractors shall permit Owner to examine any of the insurance
policies specified herein.
11.1.5 Deductibles. Subject to ARTICLE 10, any and all
deductibles specified in the above described Contractor or Subcontractor
insurance policies shall be assumed by, for the account of, and at the sole risk
of Contractor or its Subcontractors.
11.1.6 Subcontractor Insurance. The provisions of the
insurance described above shall apply to Contractor and its Subcontractors, and
these specifications shall be incorporated in any contract or agreement between
Contractor and its Subcontractors who perform Work under this Agreement.
11.1.7 Evidence of Insurance. Contractor shall not
commence Work at the Site until a certificate in evidence of insurance coverage
has been provided to and approved by Owner, nor shall Contractor allow any
47
Subcontractor to commence Work at the Site until said Subcontractor has provided
a certification in evidence of insurance coverage, and said certification has
been provided to and approved by Owner. Certificates shall be furnished to Owner
promptly and must reflect both the endorsement provisions requiring thirty (30)
days prior written notice to be given before cancellation or material change,
and the additional interest where applicable. Each certificate shall specify the
date when such benefits and insurance expire. Contractor agrees that such
benefits and insurance, as specified above, shall be provided and maintained
until Final Acceptance.
11.2 It shall be a condition of approval that the required insurance
must be arranged with insurance companies authorized to do business in the State
of Utah, U.S.A.
11.3 Contractor shall be responsible for compliance by all of its
Subcontractors with these insurance requirements and shall furnish certificates
as provided herein evidencing the required insurance for its Subcontractors.
11.4 Owner's approval or failure to approve or disapprove insurance
certificates furnished by Contractor or its Subcontractors shall not relieve
Contractor or its Subcontractors from responsibility for liability, damage, and
accidents as set forth herein.
11.5 If at any time the required insurance policies described in this
Section 11.1 should be canceled, terminated or modified so that the insurance is
not in full force and effect as required herein, and such insurance is not
replaced within ten (10) days after written notice to Contractor, such event
shall be a default hereunder and Owner may obtain insurance coverage equal to
that required herein and recover the premium costs therefor from Contractor.
11.6 Contractor and its Subcontractors shall, as they deem necessary,
carry fire, theft, physical damage, or other insurance on their own and their
employees' tools, equipment, reusable materials (such as metal forms and metal
scaffolding), trailers, and any property of their employees.
11.7 OWNER'S INSURANCE. Owner shall, at its sole cost, carry "Builder's
All Risk" insurance covering all risk of physical loss or damage to the Work at
the Site, including all materials, equipment, and supplies which are being
transported to the Site and which are to become a part of the Work (but
excluding any loss or damage to Contractor's or any Subcontractor's equipment,
machinery, or tools, and equipment or property of a similar nature not destined
to become a permanent part of the completed Work or Project). Such insurance
shall be provided with a limit sufficient to cover property values at risk on a
replacement cost basis, and shall insure against the perils of fire and extended
48
coverage and shall include "all risk" insurance for physical loss or damage,
including, without duplication of coverage, theft, vandalism, and malicious
mischief. Owner, Contractor and Subcontractors shall be named as insureds under
said policy, as their interests appear.
11.8 PROPERTY INSURANCE LOSS ADJUSTMENT.
11.8.1 Any insured loss shall be adjusted with Owner and
Contractor and made payable to Owner and Contractor as trustees for the
insureds, as their interests may appear. Unless otherwise mutually agreed, if
the proceeds are not used to restore any damaged or destroyed portions of the
Work to which such proceeds relate, such damaged or destroyed Work shall be
deemed to be fully complete in accordance with the Contract Documents and
accepted by Owner, and Contractor shall be entitled to a Change Order for any
Additional Work or Change in warranties or guaranties resulting from such
damaged or destroyed Work or the affect of such damaged or destroyed Work on the
balance of the Project.
11.8.2 Upon the occurrence of an insured loss, monies
received will be deposited in a separate account and the trustees shall make
distribution in accordance with the agreement of the parties in interest, or in
the absence of such agreement, in accordance with an arbitration award pursuant
to ARTICLE 13. If the trustees are unable to agree between themselves on the
settlement of the loss, such dispute shall also be submitted for resolution
pursuant to ARTICLE 13.
11.9 WAIVER OF SUBROGATION. The insurance policies carried by
Contractor and its Subcontractors pursuant to Section 11.1.3 (c) hereof shall
contain endorsements waiving the insurer's right to subrogation against Owner,
its members and their respective subsidiaries, associated, and affiliated
companies, and their employees, officers, and directors. Contractor shall
require similar waivers from all Subcontractors and any consulting engineers and
shall require each of them to include similar waivers in their subcontracts of
any tier and consulting agreements.
11.10 LIMITATION OF LIABILITY OF CONTRACTOR.
11.10.1 The liability of Contractor for third party claims
arising out of or relating in anyway to the Work or the Project shall in no
event exceed the amount of insurance which Contractor or Owner are required to
provide by the terms hereof plus any deductible paid by Contractor.
11.10.2 Notwithstanding anything in the Contract Documents
to the contrary, in no event will either party be liable to the other party or
49
any other person for consequential or special damages, including but not limited
to, loss of use of the facilities or equipment, lost profits, lost production or
inability to perform collateral contracts.
11.10.3 This Section 11.5 and all of its subparagraphs
shall not be valid or enforceable should such liability arise as a direct result
of fraud or intentional misrepresentation on the part of Contractor or Owner.
11.11 DAMAGE TO VEHICLES. In addition to Contractor's liability for
property damage as set forth in the Contract Documents, Contractor shall also be
responsible and shall indemnify and hold harmless Owner for any damage to
Contractor's vehicles and the vehicles of its Subcontractors, employees, and
agents or representatives of Contractor or Subcontractors while the vehicles are
parked or used on Owner's property or in the performance of the Work.
ARTICLE 12 TERMINATION AND OWNER'S TAKEOVER RIGHTS
12.1 TERMINATION BY OWNER FOR CAUSE.
12.1.1 If any or all Work to be performed under this
Agreement is abandoned by Contractor; if Contractor materially fails to abide by
the Laws of governmental authorities having jurisdiction; or, if Contractor
materially utilizes improper materials and/or inadequately skilled workers; or,
if Contractor materially does not make proper payment to laborers, material
suppliers or Subcontractors; or, if any material amount of the Work is
subcontracted by Contractor without the required approval of Owner; or, if
Contractor becomes insolvent or unable to meet its payroll or other current
obligations or be adjudicated a bankrupt, or have an involuntary petition of
bankruptcy filed against it, or make an assignment for benefit of creditors, or
file a petition for an arrangement, composition, or compromise with its
creditors under any applicable Laws, or have a trustee or other officer
appointed to take charge of its assets; or, if Contractor is violating any of
the conditions or provisions of this Agreement; or, if Owner determines that
Contractor is refusing or failing to perform properly any Work or that
Contractor is performing Work in bad faith or not in accordance with the terms
hereof; or if Contractor is otherwise in material breach of any provision of
this Agreement or fails to substantially perform any of its obligations
hereunder and does not commence and diligently proceed to cure any such default
within ten (10) days after receipt of written notice of default, Owner may,
without notice to Contractor's sureties, either withhold any amounts necessary
to cure such default or terminate Contractor's right to proceed with all or any
portion of such Work. Owner will then have the right to complete such Work by
whatever reasonable method Owner may deem expedient, including employing another
contractor under such form of contract as Owner may deem advisable, and Owner
shall have the right to take possession of and use until Mechanical Completion
50
any or all of the materials, plant, tools, equipment, supplies, and property of
every kind furnished by Contractor for such Work.
12.1.2 The expense of so completing such Work, which is in
excess of the expense that Owner would have incurred if Contractor had completed
the Work, together with a reasonable charge for administering any contract for
such completion, will be charged to Contractor, and such expense may be deducted
by Owner out of such monies as may be due or may at any time thereafter become
due to Contractor.
12.1.3 Upon receipt of any such written notice of
termination of right to proceed, Contractor shall, at Contractor's expense, take
the following actions for that Work affected by any such termination:
12.2 Assist Owner in making an inventory of all materials and equipment
in storage at the Site, in route to the Site, in storage or manufacture away
from the Site, and on order from suppliers;
12.3 Assign to Owner subcontracts, supply contracts and equipment
rental agreements all as designated by Owner; and
12.4 Remove from the Site all construction materials, equipment and
plant listed in said inventory other than such construction materials, equipment
and plant that are designated in writing by Owner to be used by Owner in
completing such Work.
In the event Owner terminates Contractor's right to perform the Work by
asserting one of the grounds set out in this Section 12.1 and such grounds are
later determined to be inapplicable, Owner's action shall then be deemed to be a
termination pursuant to Section 12.2, TERMINATION FOR CONVENIENCE, and subject
to all payment terms therein.
12.4.1 The procedure provided in this Section 12.1 for
termination shall be concurrent with and in addition to and without prejudice
to, and not in lieu of or in substitution for, any other rights or remedies at
law or in equity which Owner may have for the enforcement of its rights under
this Agreement and its remedies for any default by Contractor of the covenants,
obligations or conditions hereof.
12.5 TERMINATION FOR CONVENIENCE.
12.5.1 Owner shall have the right at any time to
terminate, for its convenience and with or without cause, all or any portion of
51
the Work upon giving five (5) days written notice thereof to Contractor. The
termination shall be effective five (5) days after the delivery of the notice or
upon such later date as may be specified in the notice. Upon such termination an
equitable settlement shall be made between Owner and Contractor. It is the
intent of the parties hereto that an "equitable settlement" hereunder shall
include payment for only the Work actually performed and the materials furnished
and incorporated into the Work up to the date of termination, plus reasonable
overhead and profit thereon, direct, actual expenses incidental to termination
and settlement plus an equitable distribution of the Operation Bonus as provided
in Section 12.2.2 hereof.
12.5.2 Pursuant to the intent of the parties as set forth
in Section 12.2.1., the parties hereby agree that the following items shall be
considered in arriving at an equitable settlement:
12.6 Direct and indirect costs and expenses of engineering, planning,
arranging, constructing, installing and administering, incurred prior to the
termination, in accordance with generally accepted accounting practices.
12.7 Reasonable costs and expenses of removing, storing and preserving
or disposing of materials not used in the performance of the Work.
12.8 Reasonable accounting, clerical and other costs and expenses
incident to termination and settlement.
12.9 Reasonable overhead and profit allowance for preparation made and
Work done prior to the termination.
12.10 Reasonable costs and expenses of settling claims, if any, of
Subcontractors, including the reasonable cost of Work done and materials
supplied by Subcontractors to the time of termination plus an equitable
allowance for Subcontractor's overhead and profit on Work done prior to date of
termination.
12.11 Amounts otherwise payable under the Contract Documents including
any Change Order Work required by Owner.
12.12 equitable distribution of the Operation Bonus as estimated on the
date of such notice; provided, that if this Agreement is terminated for
convenience (a) less than ninety (90) days after the Effective Date, Contractor
shall receive no portion of the Operation Bonus, or (ii) more than ninety (90)
days after the Effective Date, Contractor shall receive the Operation Bonus in
the ratio that the sum of the Contract Price paid to Contractor as of the date
52
of termination bears to the entire Contract Price, and such amount shall be
promptly paid to Contractor at the end of the Operation Period.
12.12.1 The following items shall not be considered in
arriving at an equitable settlement except to the extent identified above:
12.13 Anticipated profits or fees to be earned on uncompleted portions
of the Work.
12.14 Consequential damages.
12.15 Expenses of Contractor due to the failure of Contractor or its
Subcontractors to discontinue the Work on the date of termination as identified
in the notice of termination.
12.16 Losses upon other contracts or from sales or exchanges of capital
assets or Internal Revenue Code Section 1244 assets.
12.16.1 Items not specifically listed in Sections 12.2.2
and 12.2.3 shall be considered or not considered in such equitable settlement in
accordance with the intent of the parties as hereinabove expressed. No final
payment shall be made by Owner hereunder, however, until Contractor has
submitted to Owner (a) a final statement supported by vouchers; (b) lien waivers
or other evidence satisfactory to Owner that Contractor has paid in full all
labor, materials, services, and subcontracts and all applicable taxes for those
cost previously paid by Owner (c) conditional lien waivers for all labor,
materials, services and subcontracts to be paid upon final payment by Owner.
12.16.2 Upon receipt of such termination notice, and
except as otherwise directed by Owner, Contractor, at Owner's expense, shall do
all things necessary to ensure the efficient, proper closeout of the terminated
Work, including, but not limited to, the following:
12.17 Perform such acts as may be necessary to preserve and protect all
Work already performed and Owner's property;
12.18 Stop performance of all Work terminated on the date of the notice
and to the extent specified in said notice, excepting only that Work which Owner
directs to be performed to carry out said termination;
12.19 Place no further orders, trade contracts, or subcontracts for
services, materials or equipment except as shall be necessary for completion of
53
such portion of the Work which is not terminated, nor make any further
procurement or other monetary commitments except with the written consent of
Owner;
12.20 At the request of Owner, terminate to the extent possible all
outstanding contracts, orders or subcontracts to the extent they are related to
or include a scope of work or equipment or material item which is subject to
said termination order;
12.21 Assign to Owner, in the manner and to the extent directed by
Owner, all the rights, title and interest of Contractor in outstanding orders or
subcontracts for Work so terminated; upon such assignment, Owner shall have the
right, but not the duty, to settle or pay any and all claims arising out of the
termination; or Owner may direct Contractor, with approval of Owner, to settle
all outstanding liabilities and all claims arising out of such termination
provided that Owner has first paid Contractor the amount of such outstanding
liabilities and claims;
12.22 Deliver to Owner, when and as directed by Owner, all documents
which, if the Work had been completed, Contractor would be required under the
Contract Documents to account for or deliver to Owner, and transfer title to
Owner to such property to the extent not already transferred.
ARTICLE 13 DISPUTE RESOLUTION
13.1 COMMITMENT TO RESOLUTION. Owner and Contractor are committed to
the timely resolution of any disputes, issues or claims between them at the
lowest possible level. Compliance with the requirements of this ARTICLE 13 is a
precondition to the filing of any complaint or Lawsuit relating to a matter in
dispute between Owner and Contractor.
13.1.1 Owner and Contractor agree to maintain good
communications between them on the Project and are committed to open and ▇▇▇▇▇
discussions of any issues which may arise. Both are committed to bringing up
issues at weekly job meetings or at specially called meetings to discuss matters
at issue.
13.1.2 Contractor may seek technical clarifications by use
of a form titled "CONTRAcTOR'S REQUEST FOR INFORMATION." Contractor shall be
solely responsible for requesting instructions or interpretations which
Contractor determines are necessary in its performance of the Work.
13.2 DISPUTE RESOLUTION PROCEDURE. In order to accomplish
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the amicable resolution of disputes, the parties agree to the following
procedure as a pre-condition to the filing of any legal action by either party:
13.2.1 Contractor shall give written notice to Owner as
soon as reasonably practicable, but in no case longer than thirty (30) calendar
days after discovery by Contractor of the occurrence of the event giving rise to
any claim by Contractor. The parties acknowledge that timely notice is required
by Owner so that all matters can be remedied or resolved promptly. If Contractor
intentionally fails to comply with such notice requirement, then the claim for
which notice is not timely given may, in the sole discretion of Owner, be
considered waived by Contractor.
13.2.2 Contractor shall submit with its claim such
information, costs, and data in such detail and specificity as may be required
by Owner to justify and substantiate such claims.
13.2.3 If the dispute resolution procedure set forth above
does not resolve the issue or claim, the matter shall be submitted to binding
arbitration as set forth in Section 13.3 hereof.
13.3 ARBITRATION.
13.3.1 Submission to Arbitration. The parties hereby
submit all controversies, claims, and matters of difference arising under this
Agreement to arbitration. Without limiting the generality of the foregoing, the
following shall be considered controversies for this purpose: (a) all questions
relating to Force Majeure Events, Changes and interpretation or breach of this
Agreement, (b) all questions relating to any representations, negotiations, and
other proceedings leading to the execution hereof, and (c) all questions as to
whether the right to arbitrate any such questions exists.
13.3.2 Initiation of Arbitration and Selection of
Arbitrators. The party desiring arbitration shall so notify the other party,
identifying in reasonable detail the matters to be arbitrated and the relief
sought. Except for Fast Track and Regular Proceedings (as defined in the
Construction Industry Arbitration Rules of the AAA (the "Rules")), arbitration
hereunder shall be before a three-person panel of neutral arbitrators,
consisting of one person from each of the following categories: (1) an attorney
with at least ten years' experience in mining law; (2) an attorney with at least
ten years' experience in construction law, including mining matters; and (3) a
person with at least ten years' experience in the oil and gas, construction or
mining industry and at least 10 years experience in tar sands or crude oil
processing. The AAA shall submit a list of persons meeting the criteria outlined
above for each category of arbitrator, and the parties shall select one person
from each category in the manner established by the AAA. If any party or the
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arbitrators fail to select arbitrators as required above, the AAA shall select
such arbitrators. Arbitrators for Fast Track and Regular Proceedings shall be
selected in the manner provided for in the Rules.
13.3.3 Arbitration Procedures. All matters arbitrated
hereunder shall be arbitrated in Salt Lake City, Utah pursuant to Utah Law, and
shall be conducted in accordance with the Rules, except to the extent such Rules
conflict with the express provisions of this Section 13.3 which shall prevail in
the event of such conflict). The arbitrator(s) shall conduct a hearing no later
than 45 days after submission of the matter to arbitration, and a decision shall
be rendered by the arbitrators within 10 days of the hearing. At the hearing,
the parties shall present such evidence and witnesses as they may choose, with
or without counsel. Adherence to formal rules of evidence shall not be required,
but the arbitration panel shall consider any evidence and testimony that it
determines to be relevant, in accordance with procedures that it determines to
be appropriate. Any award entered in an arbitration shall be made by a written
opinion stating the reasons for the award made.
13.3.4 Enforcement. This submission and agreement to
arbitrate shall be specifically enforceable. Arbitration may proceed in the
absence of any party if notice of the proceedings has been given to such party.
The parties agree to abide by all awards rendered in such proceedings. Such
awards shall be final and binding on all parties to the extent and in the manner
provided by Utah Law. All awards may be filed with the clerk of one or more
courts, state, federal, or foreign, having jurisdiction over the party against
which the award is rendered or its property, as a basis of judgment and of the
issuance of execution for its collection. No party shall be considered in
default hereunder during the pendency of arbitration proceedings specifically
relating to such default.
13.3.5 Fees and Costs. The arbitrators' fees and other
costs of the arbitration and the reasonable attorney fees, expert witness fees
and costs of the prevailing party shall be borne by the non-prevailing party. In
its written opinion, the arbitration panel shall, after comparing the respective
positions asserted in the arbitration claim and answer thereto, declare as the
prevailing party that party whose position was closest to the arbitration award
(not necessarily the party in favor of which the award on the arbitration claim
is rendered) and declare the other party to be the non-prevailing party. The
arbitration award shall include an award of the fees and costs provided by this
Section 13.3.5 against the non-prevailing party.
13.4 WORK CONTINUANCE. At all times, even if a matter is subject to a
dispute resolution procedure, Contractor shall proceed with the undisputed Work
in accordance with the determinations, decisions, instructions and
clarifications of Owner, without waiver by Contractor of any rights, claims or
defenses relating thereto, and Contractor shall be compensated as provided in
this Agreement during such Work continuance; provided, however, that Contractor
shall be paid for all disputed amounts included in any application for payment
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on the basis of time and materials as provided in ARTICLE 8 hereof, except that
the ▇▇▇▇-up of Contractor on such amounts may be withheld by Owner pending the
outcome of the dispute resolution proceedings provided for in this ARTICLE 13.
In the event Contractor is not timely paid the undisputed portions of any
invoice, as set forth in Section 6.6.1, Contractor shall, in addition to its
other rights and remedies, have the right to suspend performance of the Work
until such payment is received by Contractor.
13.5 MULTIPARTY PROCEEDING. The parties agree that they will use their
best efforts to ensure that all parties necessary to resolve a claim or issue
are parties to the same dispute resolution procedure required by this ARTICLE
13. Appropriate provisions shall be included in all contracts between Contractor
and its Subcontractors at any tier to require any Subcontractor to consolidate
any claims it may have with those of Contractor in any dispute resolution
procedure required under this ARTICLE 13.
ARTICLE 14 LABOR, SAFETY & SECURITY
14.1 LABOR, EMPLOYEES, SUPERVISION.
14.1.1 Except for termination or completion of work
assignment, Contractor's Project Manager and Project Engineer who are assigned
by Contractor to the Project will not be removed from the Project or assigned
additional work on other Projects without providing notice to Owner. In
addition, with respect to voluntarily removal of any such person by Contractor,
Contractor will submit to Owner one (1) month advance formal written notice that
any such Project Manager or the Project Engineer assigned to the Project will be
removed.
14.1.2 Contractor shall keep a superintendent at the Site
during the progress of the Work who shall represent Contractor, and all
directions given to the superintendent by Owner shall be as binding as if given
directly to Contractor. All major directions or instructions by Owner will be
confirmed in writing as provided herein.
14.2 PERFORMANCE OF WORK, CARE REQUIRED. Contractor and its
Subcontractors of any tier shall at all times conduct all operations under this
Agreement in a reasonable manner to avoid the risk of bodily harm to persons or
risk of damage to any property at the Site. Contractor shall promptly take all
reasonable precautions which are necessary and adequate against any conditions
which involve a risk of bodily harm to persons or damage to any property.
Contractor shall inspect all of the Work in an effort to discover and determine
any such conditions, and shall be solely responsible for discovery,
determination, and correction of any such conditions. Contractor and its
Subcontractors of any tier shall assure that their personnel are properly
trained and fully qualified to perform operations in the manner described above.
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14.3 STRIKES. Contractor shall at all times supply a sufficient number
of skilled workers to perform the Work covered by this Agreement with promptness
and diligence. Should any workers performing Work covered by this Agreement
engage in a strike or other Work stoppage or Work slowdown or cease to work due
to picketing or a labor dispute of any kind, Contractor shall take all
appropriate and commercially reasonable steps to ensure that its work force
continues to the extent practicable.
14.4 ILLUMINATION. When any Work is performed at night or where
daylight is shut off or obscured, Contractor shall provide artificial light
sufficient to permit Work to be carried on efficiently, satisfactorily, and
safely, and to permit thorough inspection. During such time periods, the access
to the place of Work shall also be clearly illuminated. All wiring for electric
light and power shall be installed and maintained to ensure the standards of
safety and accident prevention for which Contractor is responsible, securely
fastened in place at all points, and shall be kept as far as possible from
telephone wires, signal wires, and wires used for firing blasts.
14.5 ACCIDENT PREVENTION.
14.5.1 Contractor shall comply with and enforce compliance
by all Subcontractors and their respective employees, agents, consultants,
Subcontractors or suppliers with the standards of safety and accident prevention
as set forth in or required by all applicable Laws of any governmental entity
having jurisdiction of the Work performed by Contractor hereunder. Contractor
warrants that it is familiar with and that its safety and accident prevention
program will be consistent with or exceed the program discussed or suggested in
the Project Safety Manual, the edition of the "Manual of Accident Prevention in
Construction", as published by the Associated General Contractors of America
Inc., and the edition of the "Accident Prevention Manual for Industrial
Operations" as published by the National Safety Council, Inc. in effect as of
the Effective Date.
14.5.2 Contractor shall submit to Owner for its review a
written copy of its contract-specific safety plan, which shall fully comply with
all requirements of the Contract Documents, prior to mobilization. Any review or
acceptance by Owner of Contractor's safety plan shall not relieve Contractor of
its responsibility for safety, nor shall such review be construed as limiting in
any manner Contractor's obligation to undertake any action which may be
necessary or required to establish and maintain safe working conditions at the
Site.
14.5.3 Contractor shall appoint a qualified safety
representative. Such safety representative shall attend all Work safety meetings
and participate fully in all activities outlined in Contractor's safety program.
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14.5.4 Contractor shall maintain accurate accident and
injury reports. Upon request, Contractor shall furnish Owner a monthly summary
of injuries and manhours lost due to injuries.
14.5.5 Contractor shall hold regularly scheduled meetings
to instruct its personnel on safety practices and the requirements of the Work
safety program. Should Contractor be cited for any violation of its safety
related obligations, Contractor shall discharge any responsibility in connection
with such violation at its own expense. Contractor agrees to indemnify, defend
and hold Owner harmless for any costs or liability incurred as a result of the
failure of Contractor or any of its Subcontractor to comply with the employee
safety and health requirements of this Agreement.
14.6 VEHICULAR REQUIREMENTS. The following traffic regulations (which
at all times shall be generally applicable to Owner and Owner's separate
Contractors) must be obeyed by Contractor:
14.6.1 All vehicles must come to a complete stop at all
gates, building entrances, stop signs, and posted railroad crossings.
14.6.2 All vehicular equipment operating on Owner's plant
roadways must be operated within posted speed limits, and seat belts must be
worn at all times while on Site.
14.6.3 When necessary for trucks to stop on tracks for
loading and unloading, the tracks must be properly flagged.
14.6.4 Vehicles must have their lights turned on and horns
sounded when entering buildings. When the driver's vision is obscured, an
observer must be assigned to the vehicle to keep all personnel safe and in the
clear.
14.6.5 Parking areas shall be designated by Owner.
14.6.6 All vehicles must adhere to traffic restrictions
and requirements.
14.6.7 Engine compression brakes shall not be used at the
Site.
14.7 EXPLOSIVES AND BLASTING. Contractor not perform any
blasting unless expressly authorized in writing by Owner.
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14.8 SAFETY.
14.8.1 Contractor shall use commercially reasonable
efforts to obtain during the performance of the Work the "Lost Time Accident
Rate" (LTA) for Contractor and each Subcontractor at any tier of at least
fifteen percent (15%) below the national average, as determined by the
Department of Labor Occupational Injury and Illness Incidence Rates schedule.
Owner shall not be responsible for any schedule adjustments, contract price
adjustments, or other liabilities for failure of Contractor or any Subcontractor
or proposed Subcontractor at any tier to meet this standard.
14.8.2 Owner reserves the right to consider any relevant
criteria on Contractor or any of the Subcontractors at any tier, such as
MSHA/OSHA citation history, accident severity, etc., reflecting on the risk of
injury or illness to Owner's property or employees, or to Owner's separate
contractors.
14.8.3 Owner may, at its option, refuse or have terminated
from the Work any Subcontractor at any tier which poses an unacceptable risk of
injury or illness to Owner's property or employees, or to Owner's separate
contractors.
14.8.4 To protect persons from injury and to avoid
property damage, adequate barricades, construction signs, flashers, or guards
shall be placed and maintained at the Site by Contractor during the progress of
construction Work, including after regular working hours and on weekends. In
addition, when required, watchmen or flagmen shall be posted at the Site by
Contractor to prevent accidents.
14.8.5 Adequate guards will be installed at the Site on
exposed moving parts of power tools and equipment. Contractor must comply and
require all Subcontractors to comply with the applicable Laws with respect
thereto in effect in the State of Utah.
14.8.6 Contractor's personnel and the personnel of any
Subcontractors are not to work from scaffolding until it is ready for use and
has been inspected and approved for use by Contractor's safety representative.
Contractor shall be liable for the careful, proper, safe, erection and
maintenance of scaffolding at the Site. Any inspection or observation by Owner
will neither impute responsibility on Owner nor relieve Contractor from
liability for the careful, proper, and safe, erection and maintenance of the
scaffolding.
14.9 PROTECTIVE EQUIPMENT.
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14.9.1 Hard hats, meeting ANSI Z.89 standards, safety
glasses, meeting ANSI Z.87 standards, and steel-toed leather work boots, meeting
ANSI Z.41 standards, (6" high minimum) shall be worn at all times by
Contractor's personnel, its Subcontractors' personnel, and any other persons
entering Owner's property at the invitation of or with the knowledge or
permission of, or on behalf of Contractor or any Subcontractors. Other
protective equipment shall be utilized as specified in applicable federal, state
and local statutes, rules, or orders, or as specified by Owner.
14.9.2 Contractor and its Subcontractors shall furnish
respirators for their employees to be available when required. Such respirators
must comply with all applicable standards and regulations relating thereto.
14.10 CONTRACTOR SUBSTANCE ABUSE PROGRAM.
14.10.1 To the extent permitted by Law, Contractor for
itself and for and on behalf of its Subcontractors at all tiers shall maintain a
substance abuse program, which program shall meet the minimum requirements
published by the Associated General Contractors of America, Inc. and the
National Safety Council, Inc. for substance abuse prevention.
14.10.2 CONTRACTOR AND ITS SUBCONTRACTORS SHALL NOT SUPPLY
TO OWNER A LIST OF THE NAMES OF INDIVIDUALS WHOSE SUBSTANCE ABUSE SCREENING
TESTING OR BLOOD ALCOHOL TESTING HAS PROVEN POSITIVE. NOR WILL THEY IN ANY WAY
COMMUNICATE OR ATTEMPT TO COMMUNICATE TO OWNER ANY DETAIL RELATING TO SUCH
INDIVIDUAL.
14.10.3 Contractor shall ensure, by exercising all
reasonable means, that its agents and employees and those of its Subcontractors
are neither under the influence of, nor do they use, possess, consume, transfer,
manufacture, or sell or attempt to sell any form of alcohol, intoxicant,
narcotic, depressant, stimulant, hallucinogen, illegal drug or
perception-altering substance except the taking of those prescribed drugs under
the direction of a licensed, qualified physician while engaged on the Project or
property, or while performing Work or engaged in activities envisaged under this
Agreement. In the event that a particular prescription or over-the-counter
medication may have an effect upon an individual's ability to perform Work on
the Project or property, Contractor shall satisfy Owner that it has taken
appropriate and adequate measure to assure that such medication will not impair
the individual's Work performance or create a risk to the individual or to
others engaged on Owner's Project or present on Owner's property, or create a
risk of damage to or impairment of property and the environment.
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14.10.4 Contractor shall retest all individuals who may
have been involved in an accident within 12 hours of the incident at no cost to
Owner.
14.11 FIRST AID, HOSPITAL, MEDICAL. Contractor shall provide and
maintain adequate first aid facilities at the Site and arrange for emergency
treatment of injuries by doctors in private practice. Owner will not assume any
responsibility, financial or otherwise, for any hospital, medical, or surgical
care or treatment which Contractor, Subcontractors, or their employees may
require during the course of the Work or at any time thereafter. In the event of
the use of any of Owner's first aid, hospital, or medical facilities or medical
personnel by Contractor, Subcontractors, or their agents or employees,
Contractor shall pay the reasonable value of any such use or services, and
agrees to indemnify and hold Owner harmless from any damage, claim, expense, or
liability which may arise out of or be incidental to such use of facilities or
services.
14.12 CLEARANCES ALONG ROADWAYS AND RAILROADS.
14.12.1 Contractor shall keep all material at least six
feet (6') from the edge of the roadways and clear of walkways, and shall
maintain a clearance of eight feet six inches (8'6") from the centerline of all
railroad track.
14.12.2 Approval for construction of temporary railroad
crossings in locations other than the areas assigned to Contractor shall be
obtained from Owner. When the use of such temporary crossings is no longer
required, said crossings shall be removed by Contractor and track restored to
its original condition. No temporary railroad crossing will be allowed on tracks
not owned by Owner unless Contractor has coordinated with the Railroad and
obtained the Railroad's advance approval and accommodation of such crossing and
Contractor fully complies with all requirements and constraints of the Railroad
regarding said temporary crossing.
14.13 CONTRACTOR'S SECURITY RESPONSIBILITIES.
14.13.1 Contractor shall at all times conduct all
operations under this Agreement in a manner to minimize the risk of loss, theft,
or damage by vandalism, sabotage, or other means to any property. Contractor
shall promptly take all reasonable precautions which are necessary and adequate
against any conditions which involve a risk of a loss, theft, or damage to its
property.
14.13.2 Contractor shall comply with any reasonable
security program adopted by Owner for the Site and all applicable Laws,
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Contractor shall cooperate with Owner on all security matters and shall promptly
comply with any reasonable Project security requirements established by Owner.
Such compliance with these security requirements shall not relieve Contractor of
its responsibility for maintaining proper security for the above noted items,
nor shall it be construed as limiting in any manner Contractor's obligation to
undertake reasonable action as required to establish and maintain secure
conditions at the Site.
14.13.3 Contractor shall prepare and maintain accurate
reports of incidents of loss, theft, or vandalism and shall furnish these
reports to Owner within 24 hours of such incident.
14.13.4 Contractor shall be responsible for the security
of the lay down area provided or assigned to it and for the equipment and/or
materials furnished, received, or issued by or to it.
14.14 SECURITY AND ACCESS TO SITE. Entrance into Owner's property by
employees of Contractor or its Subcontractors will be subject to Owner's
reasonable security rules and regulations disclosed to Contractor in writing,
and Contractor agrees to comply and cause compliance by its Subcontractors
therewith. Contractor may obtain authorization for trucks and other vehicles to
enter Owner's property subject to compliance with such rules and regulations.
Contractor's representatives and employees must enter the Site through an
entrance designated by Owner. If Owner requests Contractor to perform security
and access functions not otherwise included in the Work Scope, then such cost
shall be Additional Work and Contractor shall be entitled to a Change Order for
such cost.
14.14.1 All vehicles that enter upon Owner's property, and
all lunch, other containers, and packages of Contractor, Contractor's employees,
its Subcontractors, and Subcontractors' employees shall be subject to inspection
by Owner's security personnel at any time while on Owner's property.
14.15 FIRE PREVENTION.
14.15.1 Within fifteen (15) days after the Effective Date,
Contractor shall submit its plan for fire prevention and fire protection at the
Site to Owner for approval. Such approval shall not relieve Contractor of its
contractual obligation to use extraordinary care with regard to fire prevention.
14.15.2 Contractor shall provide portable fire
extinguishers compatible with the hazards of each work area, and shall instruct
its personnel in their location and use. Wherever welding and burning are
conducted, flammable materials shall be protected, and an observer shall be
provided by Contractor to be present during the burning
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and welding operation to ensure that protective measures are taken and that no
fires result from such operation.
14.15.3 In the event of fire, Contractor shall immediately
notify Owner's appropriate fire control department. Contractor shall be advised
prior to commencement of Work at the Site as to the details of reporting such an
emergency.
ARTICLE 15 MISCELLANEOUS PROVISIONS
15.1 WORDS AND PHRASES. Where the words "as shown," "as detailed," "as
indicated," or words of like import are used in the Contract Documents,
reference is to the drawings, unless the context clearly indicates a different
meaning. Where the words "required," "approved," "satisfactory," "determined,"
"acceptable," or words of like import are used in the Contract Documents, action
by Owner is indicated unless the context clearly indicates otherwise, and all
Work shall be in accordance therewith. Such action, or failure to act, shall not
relieve Contractor of its contractual responsibilities for performance of its
duties and obligations under the terms of the Contract Documents. Wherever in
the Contract Documents it is provided that Contractor shall perform certain Work
"at its expense" or "without charge," or that certain Work will not be paid for
separately, such above quoted words mean that Contractor shall not be entitled
to any additional compensation from Owner for such Work, and the cost thereof
shall, unless otherwise specified, be considered as included in the payment for
other items of Work. Whenever the Contract Documents permit or require action by
Owner, including approvals, consents or review, such action shall be reasonably
taken and not be unreasonably withheld or delayed. Words, expressions and
phrases of a technical nature which are not otherwise defined herein shall be
interpreted in accordance with a recognized and well known trade meaning in the
construction industry.
15.2 TEAM RELATIONSHIP. Owner and Contractor proceed with the Project
on the basis of trust, good faith and fair dealing. They agree to take all
actions reasonably necessary to perform this Agreement in an economical and
timely manner consistent with the terms and conditions hereof.
15.3 EXTENT OF AGREEMENT. The Contract Documents are solely for the
benefit of the parties hereto and represent the entire and integrated agreement
between the parties, and supersede all prior negotiations, representations or
agreements, either written or oral, which are fully merged herein, with the
exception of that certain Confidentiality Agreement dated as of December 1996
executed by MCNIC Oil & Gas Company and Contractor (the "Confidentiality
Agreement") and Services Agreement.
15.4 QUALIFICATION IN STATE.
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15.4.1 Contractor is a limited liability company organized
under the laws of the State of Utah. Upon Owner's reasonable request, Contractor
shall provide Owner with a certificate of good standing from the Utah Department
of Commerce during the period of this Contract.
15.4.2 TRADE AND PROFESSIONAL LICENSES. Contractor is duly
licensed to do the type and scope of Work contemplated and required by the
Contract Documents and employs and will utilize in performing the Work hereunder
professional engineers who are properly licensed in the State of Utah to provide
design and engineering services and to certify and stamp the drawings which are
a part of the Work hereunder. Contractor shall not (a) engage the services of or
purchase materials or labor for use on the Project from any person or firm
required to be licensed under the Utah Construction Trades Licensing Act, who is
not duly and properly licensed to perform the services or provide the labor and
materials sought by Contractor for purposes of the Project; or (b) utilize
engineers to perform the Work who are not properly licensed to perform such
services in the State of Utah.
15.5 CONTRACTOR'S STATUS. Contractor represents that it is fully
experienced, properly qualified, registered, licensed, equipped, organized, and
financed to perform the Work as required under the Contract Documents. For all
purposes Contractor is, and shall be deemed to be and treated as, an independent
contractor and not as the agent of Owner while engaged in the performance of the
Work. Nothing set forth herein shall be deemed to create the relationship of
partners, principal and agent, or joint venturers between the parties hereto.
Contractor shall maintain complete control over its employees, suppliers and
Subcontractors. Nothing contained in the Contract Documents or any subcontract
awarded by Contractor shall create any contractual relationship between any such
supplier or Subcontractor of any tier and Owner. Contractor shall perform its
Work hereunder in accordance with its own methods subject to compliance with the
Contract Documents.
15.6 COMMERCIAL ACTIVITIES. Contractor shall not establish any
commercial activity or issue concessions or permits of any kind to third parties
for establishing commercial activities on lands owned or controlled by Owner
except to the extent necessary for the proper performance of the Work.
Contractor shall not allow its employees to engage in any commercial activities
on the Site.
15.7 SITE INSPECTION. It is agreed, that prior to the award of this
Agreement, Contractor visited the Site. By execution of the Agreement,
Contractor acknowledges such visit and an understanding of the conditions under
which the Work must be accomplished including the manner of construction and
access to the Site.
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15.8 CONFIDENTIAL INFORMATION.
15.8.1 Owner and Contractor agree that the Confidentiality
Agreement is, and remains, in full force and effect. Owner agrees to be bound by
the terms and provisions of such Confidentiality Agreement as fully and
completely as if Owner were a signatory thereto. Notwithstanding the foregoing,
Owner and Contractor agree that (a) Contractor and its employees shall not
without prior consent of Owner, make any public announcement regarding the
financial terms and conditions of the Agreement, and (b) Contractor may, with
the Owner's approval, which approval shall not be unreasonably withheld, issue a
press release concerning the entry of Contractor and Owner into this Agreement,
(b) may place signage at and near the Site identifying the Project and
Contractor's involvement in the Project, and (c) and Owner may develop and use
certain photographic and general descriptions of the Project in their respective
sales and marketing efforts.
15.8.2 Owner acknowledges that Contractor's reports,
plans, specifications, field data, field notes, laboratory tests data,
calculations, estimates and similar data and documents are instruments of
professional service and not products. In consideration of the relinquishment of
Ownership of such documents by Contractor, Owner hereby waives any claim against
Contractor and shall defend and hold harmless Contractor from and against any
liability for injury or loss allegedly arising from re-use of any of such
documents on another project.
15.9 NONWAIVER OF DEFAULTS. Failure of Owner or Contractor at any time,
or from time to time, to enforce or require strict observance and performance of
any term or condition of the Contract Documents will not constitute a waiver of,
or affect, or impair such term or condition in any way; nor will such failure
affect the right of either party to avail itself at any time of such remedies as
it may have for any breach or breaches of such term or condition by the other
party.
15.10 CONFLICT OF INTEREST. Contractor and Owner shall exercise
reasonable care and diligence and establish reasonable precautions to prevent
its employees or agents from making, receiving, providing, or offering
substantial gifts, entertainment, payments, loans, or other considerations for
the purpose of influencing the individuals to act contrary to the requirements
of the Contract Documents. This obligation shall apply to the activities of the
employees and agents of Contractor in their relations with the employees and
their families of Owner and of third parties associated with the Work and visa
versa.
15.11 EMPLOYEES. Prior to Final Acceptance and for a period of six (6)
months thereafter, neither party will offer employment or enter into any
consulting arrangement with an employee of the other party who was an employee
of such party as of the Effective Date or at any time during the Contract Time.
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15.12 LAWS, ORDINANCES, PERMITS, LICENSES, AND TAXES.
15.12.1 Contractor shall comply with all Laws, safely
plans, and requirements of every duly constituted governmental authority, agency
or instrumentality having jurisdiction over the Work or the Site that are
applicable at the time Contractor performs the Work. Contractor shall notify
Owner immediately upon any denial, suspension or revocation of any permit; shall
make all contributions with respect to employment required by such applicable
Laws, and shall assume and pay any taxes imposed on the Work, including sales
and use tax, as any or all of which may apply to these Contract Documents except
that Owner shall indemnify Contractor from any sales tax not paid by Contractor
or its Subcontractors in reliance on any exemption claimed by Owner. All
Subcontractors, vendors or suppliers performing Work under this Contract will
comply with the terms and conditions of this Section 15.12.1.
15.12.2 All articles and materials furnished by Contractor
hereunder shall comply with such provisions of the Federal Occupational Safely
and Health Act of 1970, and the Federal Mine Safely and Health Amendments Act of
1977 and regulations under said Acts as apply to the possession and use of such
articles and materials as contemplated by the Contract Documents. Contractor
shall furnish Material Safely Data Sheets for all such materials.
15.12.3 To the extent that the Work contemplated herein
requires Contractor to perform its Work in areas which are subject to the
jurisdiction of Federal Mine Safety and Health Administration, State
Occupational Safety and Health Acts, and/or Federal Occupational Safety Health
Act of 1970 (herein collectively referred to as MSHA/OSHA laws), Contractor
shall apply for and obtain a Contractor identification number as required under
the MSHA/OSHA laws. Contractor shall be responsible for compliance by Contractor
and its Subcontractors with all standards, rules, and regulations promulgated
under applicable MSHA/OSHA laws, and shall be responsible for any citations or
orders issued thereunder arising out of Work to be performed by Contractor or
its Subcontractors pursuant to this Agreement, including any assessment levied
in connection therewith.
15.12.4 Notwithstanding any of the foregoing, to the
extent that compliance with any future Laws, or any changes in existing Laws
enacted or amended after the Effective Date, of any duly constitutional
governmental authority, agency, or instrumentality imposes on Contractor
additional requirements to the Work Scope, Owner shall reimburse Contractor for
the additional cost incurred by Contractor as a result thereof and grant a
reasonable extension of time for the execution of the Work in accordance with
ARTICLE 7, CHANGES IN THE WORK. Except as provided in the foregoing sentence or
elsewhere in this Agreement, Contractor shall be responsible for any additional
costs of construction required by a change in the Laws after the Effective Date
hereof.
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15.13 INVENTIONS. Contractor agrees that all inventions and
developments arising out of Work performed under this Contract made by
Contractor, Contractor's employees, its Subcontractors or Subcontractors'
employees, are the property of Owner. Contractor agrees to promptly communicate
such inventions and developments to Owner. Contractor further agrees to do or
cause to be done, upon Owner's request and at Owner's expense, all reasonable
acts and things to assist Owner as may be necessary for filing and prosecuting
patent applications on said inventions and developments.
15.14 ASSIGNMENT. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto, their successors and assigns. Contractor
shall have the right to assign any money due or to become due Contractor
hereunder provided that any such assignment shall not be effective until written
notice is provided Owner hereunder. Owner may freely assign this Agreement to
any affiliated or subsidiary corporation which is sufficiently capitalized to
perform Owner's obligations under this Agreement. Contractor may subcontract
portions of this Agreement and with respect to any portion of the Work and/or
services so subcontracted to any such Subcontractor, Contractor hereby
guarantees the performance of this Agreement by each such Subcontractor and
hereby assumes full responsibility for any and all of their acts or omissions.
Owner and Contractor shall remain fully liable to each other notwithstanding any
such approved assignment and/or subcontract. No assignee of Contractor shall
further assign performance without the prior approval of Contractor and Owner.
15.15 CONTROLLING LAW. This Agreement shall be construed and enforced,
and all rights and liabilities hereunder shall be determined, in accordance with
the laws of the State of Utah. Any legal proceeding of any nature brought by any
party to this Agreement against the other party to enforce any right or
obligation under the Contract Documents, or arising out of any matter pertaining
to this Agreement or the Work to be performed hereunder, shall be submitted for
trial before a court of competent jurisdiction.
15.16 SEVERABILITY. Any provision or paragraph of this Agreement
prohibited by law of any state or held to be invalid in any state, shall, as to
such state, be ineffective to the extent of such prohibition or invalidity, and
such provision or paragraph shall be severable from this Agreement without
invalidating the remaining provisions or paragraphs hereof.
15.17 NOTICES.
15.17.1 All notices, agreements, approvals, demands,
requests, consents, waivers, directives, instructions, designations, and other
communications (collectively called "Notices") required by this Agreement or
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permitted to be given or made by either party to the other shall be valid only
if given in writing by a duly designated representative or representatives of
such other party.
15.17.2 Notices required pursuant to this Agreement shall
be delivered to Owner by hand, sent by facsimile transmission, or sent prepaid
by registered or certified mail, return receipt requested, addressed as follows:
CROWN ASPHALT RIDGE, L.L.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Copies to the following for all Notices required under
ARTICLE 13 hereof:
MCNIC PIPELINE & PROCESSING COMPANY
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
and
MCNIC PIPELINE & PROCESSING COMPANY
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other person and/or address or addresses as
Owner may direct by written Notice given pursuant to this ARTICLE 15. Any such
Notice sent shall be deemed to have been given when delivered into U.S. mails
postage prepaid, or if not mailed, when actually delivered and written receipt
therefor obtained.
All other notices, such as directives and instructions
dealing with the day by day operations under this Agreement, shall be sent to
Owner only.
15.17.3 Notices required to be given to Contractor
pursuant to this Agreement shall be delivered by hand, sent facsimile
transmission, or sent prepaid by registered or certified mail, return receipt
requested, addressed as follows:
If to Contractor:
CENTRY CONSTRUCTORS AND ENGINEERS, LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
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Copies to the following for all Notices required under
ARTICLE 13 hereof:
▇▇▇▇▇▇▇, PARR, WADDOUPS, ▇▇▇▇▇ & GEE
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other person or persons and/or address or
addresses as Contractor may direct by written Notice given pursuant to this
ARTICLE 15. Any such Notice so sent shall be deemed to have been given on the
actual delivery date of such Notice.
All other notices, such as directives and instructions
dealing with the day by day operations under this Agreement, shall be sent to
Contractor only.
15.17.4 Unless otherwise provided in the Contract
Documents, if Contractor receives oral instructions from Owner, written Notice
confirming said instructions shall be submitted in writing by Owner to
Contractor or confirmed in writing by Contractor to Owner within ten (10) days
after receiving such instructions.
15.18 NO INTENDED THIRD PARTY BENEFICIARIES. This Agreement is solely
between Owner and Contractor, and there are no intended third-party
beneficiaries hereto, including but not limited to Contractor's Subcontractors,
suppliers, consultants or other parties retained by Contractor as part of the
Work provided hereunder.
15.19 COUNTERPARTS; FACSIMILE SIGNATURES. This Agreement may be signed
in any number of counterparts with the same effect as if the signatures on each
counterpart were on the same instrument. Executed documents sent by facsimile
transmission shall be valid and binding.
IN WITNESS WHEREOF, the parties by their authorized representatives
have executed this Agreement as of the Effective Date intending to be legally
bound.
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"Contractor"
CEntry Constructors & Engineers, LLC
a Utah limited liability company
By_____________________________
Its __________________________
"Owner"
CROWN ASPHALT RIDGE, L.L.C.,
a Utah limited liability company
By_____________________________
Its __________________________
By_____________________________
Its __________________________
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