Document:

Exhibit
10.42

 

InVision Technologies, Inc.

7151
Gateway Boulevard

Newark,
California 94560

Telephone:
510 739 2400

Facsimile:
510 739 6400

 

SUPPORT AND MAINTENANCE AGREEMENT

 

 

***Text
Omitted and Filed Separately

Confidential
Treatment Requested

Under 17
C.F.R. §§ 200.80(b)(4) and 240.24b-2

 

	
  PURCHASER

  	
  Contract Number:

  	
  SMA-021119-G

  
	
  Siemens
  Explosive-Detection Field Services, LLC.

  	
  Quotation Date:

  	
  November
  24, 2002

  
	
   

  	
  Quotation Expires:

  	
  30
  days after Quotation Date

  
	
   

  	
   

  	
   

  
	
  Address for Notices:
  Attn:  David French

  	
   

  	
   

  
	
   

  	
  250 E. Arapaho, Suite
  175

  Richardson, TX  75081

  	
  Beginning Date:

  	
  November
  1, 2002

  
	
  Phone: 

  	
   972-238-6810

  	
  Length of Term:

  	
  Until
  December 31, 2002, with five one-year options to renew

  
	
  Fax:

  E-mail:

  	
  972-238-6898  

  david.french@siemens.com

  	
  Serial No / 

  Location:

  	
  Per
  Exhibit 2

  
	
   

  	
   

  	
   

  
	
  Technical / Performance
  Contact:  Dave Patterson

  	
   

  	
   

  
	
  Phone :  972-238-6833

  	
   

  	
   

  
	
  Fax :      972-238-6898

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Billing Contact: 

  	
  Payment Terms:

  	
  Monthly

  
	
  Address: 

  	
  (Upon approval)

  	
   

  
	
  Phone:

  	
   

  	
   

  
	
  Fax:

  	
   

  	
   

  
	
  E-mail:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
					

 

	
  Qty

  	
   

  	
  Product
  Description

  	
   

  	
  Unit Price

  $US

  	
   

  	
  Total
  Price

  $US

  	
   

  
	
  App

  	
   

  	
  Comprehensive Support Plan

  	
   

  	
  1st
  year

  	
   

  	
  1st
  year 

  	
   

  
	
  [***]

  	
   

  	
  •    24-hour telephone technical support

  	
   

  	
  CTX 2500 $[***] 

  	
   

  	
  $ [***]

  	
   

  
	
  [***]

  	
   

  	
  •    Modem remote diagnostic support 

  	
   

  	
  CTX 5500 $[***] 

  	
   

  	
  $ [***]

  	
   

  
	
  [***]

  	
   

  	
  •     Software
  upgrades for maintenance and “bug fixes,” not new features or software that
  requires modified hardware 

  	
   

  	
  CTX 9000 $[***]

  	
   

  	
  $ [***]

  	
   

  
	
   

  	
   

  	
  •     60 minutes or less telephone
  response time 

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     On-site response subject to
  local conditions 

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     InVision
  performs Response Maintenance, Monthly Preventive Maintenance and Remedial
  Service during covered hours (M-F 0800 — 1700 except holidays, local time) 

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     Purchaser
  may request maintenance or service during other hours at InVision’s billable
  rate 

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     InVision
  performs Quarterly Preventive Maintenance during off-peak hours 

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     Defective
  parts replaced on a return basis ·Consumables included during scheduled
  maintenance

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [***]

  	
   

  	
  Extended
  Hours Support 

  	
   

  	
  1st
  year 

  	
   

  	
  1st
  year 

  	
   

  
	
   

  	
   

  	
  •     Extends covered hours to 24 hours / day,
  365 days / year during the warranty or service period

  	
   

  	
  $ [***] / year

  	
   

  	
  $ [***]

  	
   

  

 

CONFIDENTIAL

 

 

SUPPORT
AND MAINTENANCE   Contract No. Error! Reference source not found.

 

	
  Qty

  	
   

  	
  Product
  Description

  	
   

  	
  Unit Price

  $US

  	
   

  	
  Total
  Price

  $US

  	
   

  
	
   

  	
   

  	
  Special
  Conditions 

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     NOTE: 
  Quantities shown are estimates. 
  Actual quantities will be the number of CTX systems operated by the
  TSA (see paragraph SC-2).

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     Price
  Escalation.  The price (unit prices
  and billable rates) shall be adjusted on April 1 of each year, beginning on
  April 1, 2003, based on the [***] in the index specified below, between
  the base period April, 2002, and April of the most recent year.  All calculations for the index shall be
  based on the latest version of the Employment Cost Index (not seasonally
  adjusted), as published by the U.S. Department of Labor, Bureau of Labor
  Statistics.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     Support. 
  InVision will provide support necessary to meet the Key Performance
  Metrics (KPM):  [***] % operational
  availability (AO), [***] hours mean time to repair (MTTR), and
  [***] hours mean time between failure (MTBF).

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     Customer
  Assistance Center.  All service calls
  will be received by the Boeing controlled Call Center.  The Call Center will then communicate to
  InVision’s Customer Assistance Center to direct efforts by InVision in the
  field.  If InVision receives calls
  requesting initial service from others, InVision will immediately communicate
  these calls to the Boeing Call Center to ensure proper tracking.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     Familiarization
  Training.  InVision will provide
  factory introductory training about InVision’s CTX series of explosive
  detection systems, including theory of operation and explanation of
  features.  InVision will provide one
  class for all of Purchaser’s designated representatives, not to exceed twenty
  persons.  The training will occur at
  InVision’s factory, and Purchaser will bear all travel and related expenses
  for its Managers.  InVision will
  provide additional classes for a mutually agreed price.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TBD

  	
   

  	
  •     “Smart
  Hands” Training.  InVision will
  provide factory training for Purchaser’s field service technicians to act as
  “Smart Hands” for the service of InVision CTX series explosive detection
  systems.  “Smart Hands” training will
  include basic maintenance; first call response and technical support-guided
  repairs.  Such “Smart Hands” dispatch
  will be at InVision’s request.  The
  training will occur at InVision’s factory, and Purchaser will bear all travel
  and related expenses for its technicians.

  	
   

  	
  TBD

  	
   

  	
  TBD

  	
   

  
	
   

  	
   

  	
  •     Data Reporting.  InVision will report data to Purchaser’s designated service
  managers and to the Boeing Call Center regarding applicable to the KPMs.  InVision will report data on InVision CTX
  series explosive detection systems, whether covered under warranty or out-of-warranty,
  to Boeing/Purchaser regarding reliability, maintainability, availability,
  service calls and actions taken in support of the contracts Key Performance
  Metrics (KPM’s), InVision will provide the data needed to populate the Boeing
  CMMS system.  The needed data for
  Boeing/Purchaser is: Job/Ticket Number, Confirmation of unit part number and
  serial number, time call received, time technician arrived to service unit,
  equipment elapsed time indicator reading (if

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

2

 

	
  Qty

  	
   

  	
  Product
  Description

  	
   

  	
  Unit Price

  $US

  	
   

  	
  Total
  Price

  $US

  	
   

  
	
   

  	
   

  	
  applicable), summary description of
  problem/malfunction, summary description of action(s) taken, identification
  of part(s) replaced (part number,
  name, serial number, qty), time expended awaiting parts, time work order
  complete.  This data is to be provided
  within thirty (30) days of work order completion. Reports will be submitted
  in InVision’s format.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Reports
  can include real-time or batch data sharing, depending on Purchaser’s and
  Boeing’s software (InVision uses Clientele software).  Purchaser to bear the costs to implement
  the data sharing functions on Purchaser’s and Boeing’s software.  The data will be used to develop targets
  for availability, reliability and maintainability to be incorporated in future
  agreements.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •    Sustaining Engineering. 
  InVision will perform sustaining engineering to develop software
  upgrades for maintenance and “bug fixes.” 
  New features and new hardware are not part of this Agreement.  (See paragraph SC-5(b)).

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •     Non-Competition.  [***].

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [***]  The foregoing notwithstanding, it is
  expressly understood and agreed between the parties that Purchaser, through
  its employees, agents and subcontractors, may continue to fulfill their
  obligations under contract with the TSA or subcontract (direct or indirect)
  with Boeing for the installation and maintenance of competing EDS products.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Purchaser
  will develop, implement, maintain and use commercially appropriate
  administrative, technical and physical safeguards, to preserve the integrity
  and confidentiality of and to prevent non-permitted or violating use or
  disclosure of InVision Confidential Information received by Purchaser.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Purchaser
  agrees that in the event of a breach or threatened breach of the terms of
  this Agreement, InVision shall be entitled to an injunction in addition to
  any other legal or equitable relief including money damages.  The parties acknowledge that InVision
  Confidential Information is valuable and unique and that disclosure in
  violation of this Agreement will result in irreparable injury to InVision.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Confidentiality Exclusion:  Notwithstanding the foregoing, the parties
  hereby agree that Purchaser may be required under it’s upper tier agreement
  to provide and /or disclose InVision’s Confidential Information to Siemens
  Dematic, Boeing and/or TSA.  The
  parties further agree that such disclosure and/or release of Confidential
  Information shall not be deemed a violation of this Agreement provided such
  disclosure is made only to the extent as required by Purchaser’s upper tier
  agreement and Purchaser provides InVision with written notice of such
  disclosure of Confidential Information.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  •

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

3

 

	
  Qty

  	
   

  	
  Product Description

  	
   

  	
  Unit Price

  $US

  	
   

  	
  Total
  Price

  $US

  	
   

  
	
   

  	
   

  	
  •    Parts Logistics.  During the first year of the Agreement,
  InVision will manage all parts logistics and will disclose to Purchaser
  Confidential Information related to parts usage.  InVision shall have the right to delete the management of parts logistics beginning on
  January 1, 2004.  The
  price to Purchaser for the Comprehensive Support Plan each year beginning in
  2004 will be reduced as a result of InVision not purchasing, storing and
  delivering the parts, as mutually agreed by InVision and the Purchaser before
  each year.

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Total
  Price

  	
   

  	
   

  	
   

  	
  Approximately

  	
   

  
	
   

  	
   

  	
  (Total price shown for
  the first year is an estimate based on comprehensive support plan with
  extended hours for all previously deployed systems plus extended hours on all
  warranty systems.  Total price shown
  for future years is an estimate based on comprehensive support plan with
  extended hours for all systems. 
  Actual prices will be based on the number of units actually deployed.)

  	
   

  	
   

  	
   

  	
  $[***] First

  Year,

  $[***] plus

  price

  escalation in

  Future Years

  	
   

  

 

This
Agreement between InVision Technologies, Inc. (“InVision”) and the Purchaser
named above (the “Purchaser”) consists of this Support and Maintenance
Agreement, the attached Standard Conditions and General Conditions and the
attached Exhibits (“this Agreement”). 
This Agreement is the entire and integrated agreement between the
parties, reflects the entire understanding of matters related hereto and
supersedes all prior negotiations, representations and agreements, whether
written or oral.

 

 

	
  Agreed and Accepted by:

  
	
   

  	
   

  
	
  InVision Technologies, Inc.

  	
  Purchaser: 
  Siemens Explosive-Detection Field Services, LLC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ David Pillor

  	
   

  	
  By:

  	
  /s/ Noe G. Bermudez

  	
   

  
	
  Title:

  	
  SVP

  	
   

  	
  Title:

  	
  Associate Counsel

  	
   

  
	
  Date:

  	
  24 Jan 03

  	
   

  	
  Date:

  	
  January 24, 2003

  	
   

  

 

4

 

STANDARD
CONDITIONS

(Support and Maintenance)

 

SC-1       Order of Precedence.  Unless otherwise provided in this Agreement,
in case of conflicts between provisions of this Agreement,

a)     the Standard Conditions shall prevail over
the General Conditions;

b)    the Support and Maintenance Agreement shall
prevail over the Standard Conditions; and

c)     duly executed addenda (if any) shall
prevail over the Support and Maintenance Agreement.

 

SC-2       Covered Products.  This Agreement applies to
all InVision CTX series explosive detection systems that are owned or operated
by the TSA (“the Products”).  InVision
has listed in Exhibit 2 the serial numbers and locations of the Products
known to InVision at the date of this Agreement.  InVision and Purchaser shall notify each other and modify this
Agreement, using the form of the Modification attached to this Agreement, of
any addition to or change in the location of covered Products.  Any resale or removal to a new location
without written notification to and consent by InVision may result in the
automatic termination of coverage for that particular system.

 

SC-3       Term.  InVision’s maintenance and repair
obligations under this Agreement will commence on the Beginning Date stated in
the Support and Maintenance Agreement, and will continue for the Length of Term
stated in the Support and Maintenance Agreement.

 

SC-4       Maintenance and Parts.  As used in this Agreement, maintenance,
service and parts are defined as follows:

 

a)     “Operator Maintenance” means items that are
maintained by the Operator per InVision’s Operator Training Manual.  Operator Maintenance includes daily system
checks using software tools, and daily and weekly visual inspections, per
InVision’s published maintenance schedule, which is subject to change.  Operator Maintenance also includes system
re-starts and fault re-sets using software tools.

 

b)    “Preventive Maintenance” means items that
are performed monthly or quarterly per InVision’s published maintenance
schedule.  Preventive Maintenance
includes mechanical, electrical and software checks, testing and minor
adjustments to ensure continued operation within InVision’s design
specifications.  Monthly maintenance
includes the inspection, cleaning and adjustment of items subject to wear.  Quarterly maintenance includes the
inspection of major systems.  InVision’s
preventive maintenance schedules are subject to change without notice.

 

c)     “Response Maintenance” means the first
response to an Operator’s request for assistance or repair.  Response Maintenance includes correcting
basic problems such as jammed bags, blocked sensors and software glitches, and
identifying the need for repairs. 
Response Maintenance also includes adjustments and replacement of parts
subject to normal wear, diagnosis and replacement of fuses and lamps, and
diagnosis using soft key accessible menus and modem remote diagnostic support.

 

d)    “Remedial Service” means service beyond
Response Maintenance.  Remedial Service
includes diagnosis using the keyboard and diagnostics software, adjustment of
gear ratio, belt tension and standby filament current, and replacement of major
assemblies.  Remedial Service also
includes the repair of any defective part, or the removal of a defective part
and installation of a replacement part. 
Remedial Service includes testing, calibration and adjustment of the
Products as necessitated by a repair or replacement.

 

e)     “Defective Part” means any part that
InVision determines is not functioning per specifications and is not
repairable.  Defective part does not
include any consumable.

 

5

 

f)     “Consumable” means any part that is
consumed or subject to wear during normal operation, including air filters,
conveyor belts, LPA side belts, leaded curtains and recording media (data
cartridges). “Consumable” does not include printer supplies (ink cartridges,
paper, etc.).

 

SC-5       Scope of Support Plan.  During the term of this Agreement, InVision
will provide the support as defined below:

 

a)     InVision will provide unlimited telephone
technical support and modem remote system diagnostic support.

 

b)    InVision will perform software upgrades for
maintenance and “bug fixes.”  Upgrades
for new features or which require hardware modifications are not included in
this Agreement.

 

c)     InVision will not perform Operator
Maintenance.

 

d)    Unless otherwise stated in this Agreement,
InVision’s covered hours are 0800 to 1700 (8:00 a.m. to
5:00 p.m.), Monday through Friday, local time, except for local holidays
as stated in Exhibit 1.  All
other hours and all local holidays are other hours.

 

e)     The Key
Performance Metrics are:  

 

	
  KPM No

  	
   

  	
  KPM TITLE

  	
   

  	
  Description

  	
   

  	
  How it is Measured

  	
   

  	
  Acceptable

  Standard

  
	
  KPM 1

  	
   

  	
  Operational availability

  	
   

  	
  Length of time deployed
  EDS are operational

  	
   

  	
  Percentage of time EDS
  are unserviceable on a monthly basis

  	
   

  	
  [***]%

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  KPM 2

  	
   

  	
  Mean Time To Repair an
  EDS Defect

  	
   

  	
  Length of time taken to
  repair EDS defect

  	
   

  	
  Calculate monthly mean
  time to repair defects

  	
   

  	
  [***] hours

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  KPM 3

  	
   

  	
  Mean Time Between
  Failures of EDS

  	
   

  	
  Length of time between
  EDS failures

  	
   

  	
  Calculate monthly mean
  time between failures

  	
   

  	
  [***] hours of
  operation No increase

  

 

The calculation of
the time EDS are unserviceable shall not include baggage handling system
downtime, operator misuse and other causes of system downtime that are beyond
InVision’s control.  The calculation of
mean time to repair shall not include the time waiting for parts if InVision
parts logistics has been deleted from this Agreement.

 

f)     InVision’s billable rate as of the date of this
Agreement is as stated in Exhibit 1. 
InVision’s billable rate is subject to an increase for each subsequent
year based on the cost escalation formula stated in the Special Conditions of
the Support and Maintenance Agreement.

 

g)    Under the “Comprehensive Support Plan” with
“Extended Hours Support,”

1)     InVision
will perform all Response Maintenance 24 hours per day, 7 days per week.

2)     InVision
will perform all Preventive Maintenance during off-peak hours or other mutually
agreed hours as determined locally.

3)     InVision
will perform all Remedial Service 24 hours per day 7 days per week.

4)     Unless InVision has deleted the management
of parts logistics, InVision will provide a replacement for any Defective Part
and authorize return of the Defective Part. 
The replacement part may be a new part or a rebuilt part.

5)     Unless InVision has deleted the management
of parts logistics, InVision will supply Consumables as needed during scheduled
maintenance.  Printer supplies are not
the responsibility of InVision.

 

6

 

6)     InVision
will perform support necessary to meet the acceptable standards of the Key
Performance Metrics.

 

SC-6       Excluded Services.

 

a)     Exclusions.  InVision shall have no obligation to perform maintenance or
remedial service, or to provide replacement parts, in connection with:

1)     repairs or maintenance of electrical work
external to the Products or of accessories, attachments, supplies, or other
devices not furnished by InVision;

2)     damage or failure caused by any intentional
or negligent act by Purchaser’s and/or owner’s employees, agents or invitees or
by any other party not under InVision’s control;

3)     damage or failure caused by attempts to
repair or service the Products by persons other than InVision employees or
agents without InVision’s prior written consent

4)     damage or failure caused by the misuse of
the Products including but not limited to the use of accessories, attachments,
supplies, or other devices not provided by InVision or the use of the Products
for any application or in any manner not specified by InVision; or

5)     damage or failure caused by electrical
conditions external to the Products including power failures and power surges.

 

b)    Notwithstanding the foregoing exclusions, at
Purchaser’s request InVision will provide replacement parts for the foregoing
excluded causes at InVision’s standard prices, plus freight and taxes. InVision
will perform service in connection with the foregoing excluded causes at
InVision’s billable rate.

 

SC-7       Warranty.

 

a)     All maintenance and remedial service
performed by InVision under this Agreement will be done in accordance with  InVision’s specifications.

 

b)    Limited Warranty.  InVision warrants that (1) the maintenance and remedial services
provided under this Agreement will be performed in accordance with InVision’s
specifications, and (2) for a period of thirty (30) days after the expiration
or other termination of this Agreement any replacement parts provided by
InVision under this Agreement will be free from defects in materials and
workmanship.

 

c)     Exclusive Remedy.  If the maintenance or remedial service
provided by InVision are not as warranted above, InVision will, at Purchaser’s
request, repeat such services to the extent such defective services have an
adverse impact upon the condition or usability of the Products.  If any replacement part provided under this
Agreement is defective in material or workmanship within thirty (30) days of
the expiration or other termination of this Agreement, InVision will repair or
replace it on the same terms as the original replacement in accordance with
Standard Conditions SC-4 and SC-5.  THE
REMEDY PROVIDED HEREIN IS THE SOLE AND EXCLUSIVE REMEDY OF PURCHASER FOR ANY
BREACH OF THE LIMITED WARRANTY PROVIDED ABOVE.

 

d)    Disclaimer.  THERE ARE NO OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
TITLE, NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE,
WHICH EXTEND BEYOND THE EXPRESS WARRANTIES STATED IN THIS AGREEMENT.

 

SC-8               Limitation of Liability.  InVision’s total liability under this
Agreement shall be limited to general money damages in an amount not to exceed
in the aggregate the value of this Agreement. This limitation of liability will
apply regardless of the form of action, whether in contract or tort (including
negligence) or based on a warranty.

 

SC-9               Payment.

 

a)     Payment
Terms.  Purchaser
shall pay the Total Price stated in the Support and Maintenance Agreement, plus
Taxes (in accordance with General Conditions GC-3 Taxes and Duties), according
to the

 

7

 

terms stated in the Support and Maintenance Agreement.  Credit terms are available upon InVision’s
approval.  Purchaser shall pay the price
for any parts, maintenance or services that are not included in the Total
Price, plus Taxes, within thirty days of receipt of an invoice therefor.  Any extension of payment period shall
require prior written approval of InVision. 
Payments that are thirty (30) days or more past due shall bear interest
at the rate for late payments of US government contracts .

 

b)     Payment
Method.  All payments
required by this Agreement shall be made in United States dollars.  Purchaser shall, at its sole expense,
institute and complete any necessary currency exchange transactions or
government proceedings for payment in United States dollars.  Payment shall be by cash, wire transfer or
other same-day available funds.  Upon
InVision’s approval, payment may be made by check, on credit terms or by sight
draft against an irrevocable letter of credit.

 

SC-10            Insurance.  During the Term of this Agreement, InVision
will maintain insurance as listed in Exhibit 3.

 

SC-11            Termination.

Notwithstanding
anything else contained herein, this Agreement may be terminated:

a)     By
InVision upon Purchaser’s failure to pay InVision beyond 90 days when payment
is due to InVision hereunder, or

b)    By
either party due to the other party’s bankruptcy, insolvency or receivership,
or

c)     By
Purchaser upon the termination of Purchaser’s contract with Boeing and/or the
TSA for the convenience of the government or for default, subject to the FAR
provisions stated in Exhibit 4, or

 

d)    By
Purchaser if InVision is terminated for default under the provisions of this
Agreement as determined by TSA or becomes an unacceptable service provider as
determined by TSA or is barred from governmental projects by any governmental
body or agency.

 

8

 

GENERAL CONDITIONS

(Sales and Support)

 

GC-1           Acceptance of Agreement.  This Agreement shall become a valid binding
contract when executed by a duly authorized representative of each party.

 

GC-2           Rejection of Other Terms.  This Agreement and the terms specified herein
shall control over any conflicting provisions of any Purchaser purchase order,
release, acceptance or other business form, and all such conflicting terms are
expressly rejected by InVision and waived by Purchaser.

 

GC-3           Taxes and Duties. Unless
stated otherwise in this Agreement, prices do not include any excise, sales,
transfer, use, value-added or like taxes, and any other duties, tariffs,
assessments or government impositions of any nature whatsoever which are levied
or based upon the payments made hereunder or arise in connection with the
Agreement (“Taxes”).  Taxes do not
include any taxes on the net profits of InVision.  InVision will add such Taxes to the price and Purchaser will
reimburse InVision for such Taxes in accordance with the Payment terms, or
within ten (10) days of InVision’s payment thereof if such Taxes are levied or
collected after final payment.

 

GC-4           Proprietary Information.

 

a)        Definitions.
For purposes of this Agreement, “Confidential Information” means all
information received from InVision, in whatever form transmitted, relating to
the automated explosive detection system’s (EDS) business plans, operations,
design, training, systems and products, whether currently manufactured or in
development which is identified as being confidential or proprietary in nature
or would reasonably be considered confidential or proprietary by its nature or
would give or increase the advantage of InVision’s competitors over InVision or
diminish InVision’s advantage over its competitors.  InVision identifies and Purchaser acknowledges that InVision’s
data related to KPMs and parts logistics are proprietary and Confidential
Information under this Agreement.

 

b)        Exceptions.   Confidential
Information shall not include any information of InVision that: (i) is already
known to Purchaser at the time of its disclosure; (ii) is or becomes publicly
known through no wrongful act of Purchaser; (iii) is received from a third
party with the right to disclose it and who provides it without restriction as
to use or disclosure; (iv) is lawfully required to be disclosed, provided that,
before making such of disclosure, Purchaser shall Immediately give InVision
written notice and cooperate with InVision to assure confidential           handling of such information.

 

c)        Ownership, Return and Destruction.  All
Confidential Information, in whatever form, including conceptual ideas
presented during any discussions between the parties, shall be and remain
property of InVision. All tangible and electronic Confidential Information shall
be returned to InVision promptly following the expiration or termination of
this Agreement or during the term of this Agreement promptly upon written
request and shall not be retained in any form by Purchaser.  Purchaser understands that its right to possess
and use the Confidential Information is contingent upon Purchaser’s complying
with the terms of this Agreement. 
Purchaser agrees that the materials are not to be reproduced and copied
for any reason without the prior written consent of InVision.

 

d)        Term and Use.  During
the term of this Agreement, and for a period of three (3) years thereafter,
Purchaser shall not disclose any Confidential Information to any person or
entity, except employees of Purchsaer who have a need to know and who have been
informed of Purchaser’s obligations under this Agreement. Purchaser understands
that the Confidential Information is for use only by employees, specifically
will not be revealed, shown, or in any manner, disclosed to employees or
representatives of InVision’s competitors in the EDS industry.  Purchaser guarantees the Confidential
Information shall not be given or sold to any person or entity outside
Purchaser’s organization and that the Confidential Information will not be used
for the manufacture of the items for which the Confidential

 

9

 

Information has been provided.Purchaser shall use the same degree of
care to avoid disclosure of Confidential Information as Purchaser uses for its
own confidential information.

 

e)        Specific Proprietary Materials. 
Purchaser will obtain from InVision data related to KPMs and parts
logistics, and other items listed and information identified as Confidential
Information (as listed on Exhibit A) under this Agreement.

 

f)         Remedies. 
Purchaser agrees that in the event of a breach or threatened breach of
the terms of Section GC-4 of this Agreement, InVision shall be entitled to an
injunction in addition to any other legal or equitable relief including money
damages. The parties acknowledge that Confidential Information is valuable and
unique and that disclosure will result in irreparable injury to InVision.

 

g)        This Agreement and the disclosure and receipt
of Confidential Information do not confer any right in the Confidential Information,
by license or otherwise.

 

GC-5           Legend Retention.  Purchaser will not remove or destroy any
copyright, logo, trademark, trade name, proprietary markings or confidentiality
legends placed on or in the Products, any containers, related materials or documentation.  Purchaser will comply with instructions
placed on in the Products, any containers, related materials or documentation.

 

GC-6           Export.  Purchaser acknowledges that the Products,
including the Threat Resolution Protocol, are subject to restrictions on
export. Purchaser will fully comply with the relevant export administration and
control laws and regulations of the United States of America and applicable
foreign countries to ensure that the Products are not directly or indirectly
exported in violation of the United States law or imported in violation of the
applicable foreign law.

 

GC-7           Permits.  InVision will not obtain and pay for all
permits for the importation, installation and operation of the Products and any
parts for the Products.

 

GC-8           Software Restrictions.   Purchaser receives no license to the
software portion of the Products. 
Purchaser shall not reproduce, decompile or disassemble all or any
portion of the software portion of the Products or sub-license, distribute or
disclose all or any portion of the software to any third party without
InVision’s express prior written consent.

 

GC-9           Disputes.

 

a)        Good Faith Negotiations.  If any dispute arises under this Agreement,
the aggrieved party shall give written notice of the dispute to the other
party.  The parties shall seek to
resolve the dispute by promptly negotiating with each other in good faith.  The negotiation shall be conducted by
representatives authorized to bind the respective party by his or her
decisions.

 

b)        Binding Arbitration.  If the parties do not reach a solution
within a period of 60 days pursuant to GC-9(a), then, upon notice by either
party to the other, all disputes, claims, questions, or differences except
disputes with respect to Confidential Information shall be finally settled by
binding arbitration administered by the American Arbitration Association in
accordance with the provisions of its Commercial Arbitration Rules.  The parties agree that (i) claims under $1
million, exclusive of interest and attorneys’ fees, shall be heard and
determined by one arbitrator selected by the American Arbitration Association,
and (ii) claims of $1 million or more, exclusive of interest and attorneys’
fees, shall be heard and determined by three arbitrators selected as follows:
within 15 days after the commencement of arbitration, each party shall select
one person to act as arbitrator and the two selected shall select a third
arbitrator within 10 days of their appointment. If the arbitrators selected by
the parties are unable or fail to agree upon the third arbitrator, the third
arbitrator shall be selected by the American Arbitration Association.

 

c)        Prior to the commencement of hearings, each of the
arbitrators appointed shall provide an oath or undertaking of impartiality.

 

10

 

d)        Judgment on the award rendered by the arbitrator(s) may be
entered in any court having jurisdiction thereof.

 

e)        Unless otherwise agreed to in writing the
Parties shall continue performance during the resolution of a dispute under
this Section.

 

f)         Legal Fees.  In any dispute arising out of this
Agreement, the prevailing party shall be entitled to its reasonable attorneys’
fees and costs, including expert witness fees.

 

g)        Equitable Relief.  Neither party shall be precluded hereby from
securing equitable remedies in courts of any jurisdiction, including, but not
limited to, temporary restraining orders and preliminary injunctions to protect
its rights and interests but such remedies shall not be sought as a means to
avoid or stay mediation or arbitration.

 

GC-10         Exclusion of Damages.  IN NO EVENT SHALL EITHER PARTY BE
LIABLE TO THE OTHER PARTY FOR SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL,
PUNITIVE OR EXEMPLARY DAMAGES, INCLUDING COMMERCIAL LOSS, LOSS OF USE, LOST
REVENUES, LOST SAVINGS, OR LOST PROFITS, EVEN IF EITHER PARTY HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES.  THE
PARTIES EXPRESSLY AGREE THAT THE PRODUCTS ARE NOT CONSUMER GOODS.

 

GC-11         Assignment.  Purchaser’s rights, duties and obligations arising
under this Agreement are not assignable or delegable without the prior written
consent of InVision.  Any attempt to
assign or delegate any rights, duties or obligations under this Agreement
without such consent or notice will be null and void.  Except as otherwise set forth above, the Agreement shall be
binding upon and inure to the benefit of the successors and assigns of the
parties hereto.

 

GC-12         Waiver.  The failure of a party to exercise any
right, power or remedy under this Agreement shall not be deemed a waiver of
such right, power or remedy, and shall not modify the terms of this
Agreement  or waive any similar default.

 

GC-13         Enforceability.  If any provision of this Agreement is held
to be invalid or unenforceable, the remaining provisions shall remain in full
force and effect.  The parties agree to
replace any invalid provision with a valid provision that most closely
approximates the intent and economic effect of the invalid provision.

 

GC-14         Modification.  This Agreement can not be modified except by
a writing executed by a duly authorized representative of each party.  No modification, amendment, addition to or
waiver of any provision of this Agreement shall be effective unless signed in
writing by authorized representatives of each party.

 

GC-15         Excused Performance.  InVision shall not be responsible for delays
or failures to perform caused by events beyond its reasonable control,
including without limitation acts of God, fire, floods, earthquakes or other
natural disasters, acts or omissions of civil or military authority, government
orders, labor disputes, strikes or other industrial disturbances, riots, wars,
acts of the public enemy, shortage of materials or embargoes.

 

GC-16         Governing Law.  THE AGREEMENT WILL BE CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT APPLICATION OF ITS CHOICE-OF-LAW
PRINCIPLES.

 

GC-17         Headings.  Headings used in this Agreement are for
reference purposes only and shall not be considered to interpret this
Agreement.

 

11

 

GC-18         Notices.  All notices required under this Agreement
shall be given in writing to the party at the address stated in this Agreement,
unless notice of change shall have been given to the other party in accordance
with this provision.  Notice shall be
deemed to have been given (a) upon receipt, if by personal delivery, (b) when
sent, if sent by confirmed telecopy, or (c) 
five (5) days after deposit in the mail, if sent by certified or
registered mail, with postage prepaid, and return receipt requested.

 

GC-19         Survival.  Upon the termination or expiration of this
Agreement, only those obligations which are still executory on both sides will
be discharged.  All other obligations
and rights (including payment for goods and services provided), and all
remedies for prior breaches of this Agreement, shall survive.

 

12

 

EXHIBIT 1

 

InVision’s Holidays (included in Other Hours, not in
Covered Hours) - US (with dates for year 2003)

 

	
  New Year’s Day

  	
   

  	
  January 1

  
	
  President’s Day

  	
   

  	
  February 17

  
	
  Memorial Day

  	
   

  	
  May 26

  
	
  Independence Day

  	
   

  	
  July 4

  
	
  Labor Day

  	
   

  	
  September 1

  
	
  Thanksgiving Day

  	
   

  	
  November 27

  
	
  Day following
  Thanksgiving

  	
   

  	
  November 28

  
	
  Christmas Day

  	
   

  	
  December 25

  

 

 

InVision’s Covered Hours 
(without Extended Hours)

 

Monday through Friday, 0800 to 1700 (8:00 a.m. to 5:00
p.m.)

All times are Local Time – per the time zone in which
the Covered Product is located.

 

 

InVision’s Billable Rates 
(First Year)

 

	
  Normal Hourly
  Rate:

  	
   

  
	
  US
  $[***] per hour

  	
   

  
	
   

  	
   

  
	
  Premium
  Hourly Rate:

  	
   

  
	
  Weekdays
  before 0800 (8:00 a.m.) and after 1700 (5:00 p.m.)

  	
  US $[***] per
  hour

  
	
  Weekends
  and Holidays

  	
  US $[***] per
  hour

  

 

13

 

EXHIBIT
2

 

COVERED PRODUCTS

 

NEED UPDATED LIST FROM INVISION

 

	
  Initial
  Systems

  	
   

  
	
  Serial No.

  	
   

  	
  Location

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

	
  Added
  Systems

  	
   

  
	
  Serial No.

  	
   

  	
  Location

  	
   

  	
  Warranty
  Expiration Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

14

 

EXHIBIT
3

 

INSURANCE

 

InVision will maintain
insurance covering its operations on an occurrence basis as follows:

 

	
   

  	
  Limit Required

  
	
   

  	
   

  
	
  Worker’s
  Compensation

  	
  Statutory

  
	
   

  	
   

  
	
  Employer’s
  Liability

  	
  $[***]

  
	
   

  	
   

  
	
  Comprehensive
  General Liability Including:

  	
   

  
	
  Products/Completed
  Operations

  	
   

  
	
  Blanket
  Contractual

  	
   

  
	
  Personal
  Injury

  	
   

  
	
  Broad
  Form Property Damage

  	
   

  
	
   

  	
   

  
	
  Bodily
  Injury

  	
  $[***]

  
	
  Property
  Damage

  	
  $[***]

  
	
  or
  Single Limit

  	
  $[***]

  
	
   

  	
   

  
	
  Automobile
  Liability

  	
   

  
	
   

  	
   

  
	
  Bodily
  Injury

  	
  $[***]

  
	
  Property
  Damage

  	
  $[***]

  
	
  or
  Single Limit

  	
  $[***]

  
	
   

  	
   

  
	
  Excess
  Umbrella Liability

  	
  $[***]

  
	
   

  	
   

  
	
  Fidelity
  coverage insuring loss(es) due

  	
   

  
	
  To
  dishonest acts of InVision or its

  	
   

  
	
  Employees
  with the following limits

  	
  $[***]

  

 

Certificates showing that the above insurance coverages are
in effect shall be furnished to Purchaser.  Additional requirements regarding Insurance
Certificates are as follows:

 

a.               The name of the
insured shown on certificate(s) must agree with name of InVision.

 

b.              Certificate(s) must
indicate the insurance provided is on an occurrence basis and the coverage
applies to location where Work is to be performed.

 

c.               InVision’s broker
will  endeavor to notify Purchaser not
less than 30 days before the effective date of any changes in the policy.

 

d.              Certificate(s) will
name  Purchaser as additional insureds,
with appropriate cross liability endorsements added to policy.

 

e.               Certificate(s) in
proper form must be in possession of Purchaser not less than 10 days prior to
starting the Work and shall remain in effect during performance of the
Work.  Purchaser has the right to reject
any certificate if it does not meet the requirements set forth in this Exhibit.

 

15

 

f.                 The certificate
will state that said insurance is primary coverage and non-contributing with
respect to the coverage afforded the additional insureds.

 

g.              None of the
requirements contained herein as to types, limits and Purchaser’s approval of
insurance coverage to be maintained by InVision is intended to and shall not in
any manner limit or qualify the liabilities and obligations assumed by InVision
under this Subcontract Agreement.

 

h.              Purchaser is not
maintaining any insurance on behalf of InVision covering loss or damage to any
property of InVision.  Purchaser shall
not be liable or responsible for any loss or damage to the Work, except to the
extent that such loss or damage results directly from Purchaser’s
negligence.  InVision shall be
responsible for the correction or restoration of any such loss or damage to the
Work resulting from performance by InVision, it’s employees, agents or
representative of the Work herein.

 

16

 

EXHIBIT
4

 

FAR PROVISION REGARDING
TERMINATION

 

12.403
Termination.

 

(a) General. The clause at
52.212-4 permits the Government to terminate a contract for commercial items
either for the convenience of the Government or for cause. However, the
paragraphs in 52.212-4 entitled “Termination for the Government’s Convenience”
and “Termination for Cause” contain concepts which differ from those contained
in the termination clauses prescribed in Part 49. Consequently, the
requirements of Part 49 do not apply when terminating contracts for commercial
items and contracting officers shall follow the procedures in this section.
Contracting officers may continue to use Part 49 as guidance to the extent that
Part 49 does not conflict with this section and the language of the termination
paragraphs in 52.212-4.

(b) Policy. The contracting
officer should exercise the Government’s right to terminate a contract for
commercial items either for convenience or for cause only when such a
termination would be in the best interests of the Government. The contracting
officer should consult with counsel prior to terminating for cause.

(c) Termination for cause.

(1)
The paragraph in 52.212-4 entitled “Excusable Delay” requires contractors
notify the contracting officer as soon as possible after commencement of any
excusable delay. In most situations, this requirement should eliminate the need
for a show cause notice prior to terminating a contract. The contracting
officer shall send a cure notice prior to terminating a contract for a reason
other than late delivery.

(2)
The Government’s rights after a termination for cause shall include all the
remedies available to any buyer in the marketplace. The Government’s preferred
remedy will be to acquire similar items from another contractor and to charge
the defaulted contractor with any excess reprocurement costs together with any
incidental or consequential damages incurred because of the termination.

(3)
When a termination for cause is appropriate, the contracting officer shall send
the contractor a written notification regarding the termination. At a minimum,
this notification shall—

(i)
Indicate the contract is terminated for cause;

(ii)
Specify the reasons for the termination;

(iii)
Indicate which remedies the Government intends to seek or provide a date by
which the Government will inform the contractor of the remedy; and

(iv)
State that the notice constitutes a final decision of the contracting officer
and that the contractor has the right to appeal under the Disputes clause (see
33.211).

(d) Termination for the Government’s
convenience.

(1)
When the contracting officer terminates a contract for commercial items for the
Government’s convenience, the contractor shall be paid—

(i)
The percentage of the contract price reflecting the percentage of the work
performed prior to the notice of the termination, and

(ii)
Any charges the contractor can demonstrate directly resulted from the
termination. The contractor may demonstrate such charges using its standard
record keeping system and is not required to comply with the cost accounting
standards or the contract cost principles in Part 31. The Government does not
have any right to audit the contractor’s records solely because of the
termination for convenience.

(2)
Generally, the parties should mutually agree upon the requirements of the
termination proposal. The parties must balance the Government’s need to obtain
sufficient documentation to support payment to the contractor against the goal
of having a simple and expeditious settlement.

 

17

 

MODIFICATION
NO.   

To
Support and Maintenance Agreement No. 
SMA-021119-G

 

Revise Exhibit 2, Covered
Systems, to:

 

Add Serial No(s).              at Site                   with a Warranty Expiration
Date of            .

 

This system is added at
the first year unit price of  $             / year.

 

All other provisions of
the Agreement remain unmodified.

 

 

	
  Agreed and Accepted by:

  
	
   

  
	
  InVision Technologies, Inc.

  	
  Purchaser: 
  Siemens Explosive-Detection

  Field Services, LLC.

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  

 

18

 

Exhibit
A

 

Specific
Proprietary Materials Identified as Confidential Information

 

1)     The data
needed to populate the Boeing CMMS system for Boeing and Purchaser to track the
Key Performance Metrics (KPM’s):

 

	
  a)

  	
   

  	
  Job/Ticket Number

  
	
  b)

  	
   

  	
  Confirmation of unit
  part number and serial number

  
	
  c)

  	
   

  	
  Time called received

  
	
  d)

  	
   

  	
  Time technician arrived
  to service unit

  
	
  e)

  	
   

  	
  Equipment elapsed time
  indicator reading (if applicable0

  
	
  f)

  	
   

  	
  Summary description of
  problem/malfunction

  
	
  g)

  	
   

  	
  Summary description of
  action(s) taken

  
	
  h)

  	
   

  	
  Identification of
  part(s) replaced (part number, name, serial number, quantity)

  
	
  i)

  	
   

  	
  Time expended awaiting
  parts

  
	
  j)

  	
   

  	
  Time work order
  complete

  
	
   

  	
   

  	
   

  

2)     Calculations,
summaries and other information derived from the data listed in Item 1,
including but not limited to:

	
  a)

  	
   

  	
  Operational
  availability of InVision EDS

  
	
  b)

  	
   

  	
  Mean Time To Repair an
  InVision EDS Defect

  
	
  c)

  	
   

  	
  Mean Time Between
  Failures of InVision EDS

  

 

***Confidential
treatment requested.

 

19Exhibit 10.7

 

AIA Document A121/CMc and AGC Document 565

Standard Form of Agreement Between

Owner and Construction Manager

where the Construction Manager is also

THE CONSTRUCTOR

 

1991 Edition - Electronic Format

 

THIS DOCUMENT HAS IMPORTANT
LEGAL CONSEQUENCES: CONSULTATION WITH AN ATTORNEY IS ENCOURAGED WITH RESPECT TO
ITS COMPLETION OR MODIFICATION. AUTHENTICATION OF THIS ELECTRONICALLY DRAFTED
AIA DOCUMENT MAY BE MADE BY USING AIA DOCUMENT D401.

 

The 1987 Edition of AIA
Document A201, General conditions of the contract for construction, is referred
to herein. This agreement requires modification if other general conditions are
utilized.

 

Portions of this document are
derived from AIA Document A111, Standard Form of Agreement Between the Owner
and Contractor where the basis of payment is the Cost of the Work Plus a Fee,
copyright 1920,1925,1951,1958,1961,1963,1967,1974,1978,© 1987 by The American
Institute of Architects; other portions are derived from AGC Document 500.  Copyright 1980 by The Associated General
Contractors of American.  Material in
this Document differing from that found in AIA Document A111 and AGC Document
500 is copyrighted 1991 by The American Institute of Architects and The
Associated General Contractors of America. 
Reproduction of the material herein or substantial quotation of its
provisions without written permission of AIA and AGC violates the copyright
laws of the United States and will subject the violator to legal prosecution.

 

AGREEMENT

made as of the first day
of September in the year of Two Thousand and one.

(In words, indicate day, month and year)

 

BETWEEN the owner:

(Name and address)

Wheeling
Island Gaming. Inc.

One South
Stone Street 

Wheeling, West
Virginia 26003(“Owner”)

 

and the Construction Manager:

(Name and Address)

Louis P.
Ciminelli Construction Company, Inc.

The Cyclorama
Building, 369 Franklin Street 

Buffalo, New
York 14202 (“Construction Manager” or “Constructor”)

 

The Project is:

(Name, address and brief description)

The “Project”
consists of preconstruction and construction services as hereinafter set forth;
The preconstruction services shall consist of the evaluation of the Owner’s
program, scheduling and construction budget formulation, and such additional
services as are set forth in this Agreement, for the construction of an
approximately 279,100 square foot facility which will house a casino, gaming
facility, entertainment center, covered parking facility and hotel, located at
One South Stone Street, Wheeling, West Virginia (the “Site” or “site”), as is
more fully set forth in the Project Manual, Drawings and Specifications, which
are incorporated by reference herein. Construction consists of a conventionally
constructed facility to house a gaming facility, restaurants, bar,
entertainment area, covered parking facility, and hotel all as is more fully
set forth in the guaranteed maximum price proposal, including all
qualifications and assumptions thereto, and together with all exhibits,
schedules, riders, addenda and attachments thereto, which has or shall be signed
by the Owner and Constructor once accepted, and incorporated herein as
Amendment No.1 hereto (the “GMP Presentation”).  Included in the Project are all costs associated with development
of the Site, and acquisition and installation of all steel, masonry, carpentry,
electrical, plumbing and HVAC work, together with the costs associated with
acquisition and installation of all improvements to complete the Project,
including but not limited to, developing the casino theme. The Constructor will
hereafter purchase all items associated with the Project directly, including
but not limited to, construction materials. The Project does not include costs
associated with the purchase of furniture, furnishings, gaming machines,
kitchen equipment and security & surveillance items, which shall be Owner’s
responsibility to acquire and install, and Constructor’s

©1991 - THE AMERICAN INSTITUTE
OF ARCHITECTS, 1735 NEW YORK AVENUE, N.W.; WASHINGTON; D.C. 20006-5292. AIA
DOCUMENT AIA121/CMC AND AGC DOCUMENT 565 - OWNER-CONSTRUCTION MANAGER AGREEMENT
- 1991 EDITION - AIA® - AGC - © 1991 - THE ASSOCIATED GENERAL CONTRACTORS OF
AMERICA, 1957 E STREET, N.W., WASHINGTON, D.C., 20006-5209.  WARNING: Unlicensed photocopying violates
U.S. copyright laws and is subject to legal prosecution. This document was
electronically produced with permission of the AIA and can be reproduced in
accordance with your license without violation until the date of expiration as
noted below, expiration as noted below, expiration as noted below, expiration
as noted below.  User Document: Revised
Main Agreement.aia — 7/18/2002.  AIA
License Number 1135994, which expires on 6/30/2003.

 

Electronic Format A121/CMc-1991

 

 

responsibility
to coordinate and schedule its installation.

 

The Architect is:

(Name and address)

Jeter, Cook
& Jepson Architects, Inc.

450 Church
Street

Hartford,
Connecticut 06103 (“Architect”)

 

The Owner and Construction
Manager agree as set forth below.

 

Table of Contents

 

	
  ARTICLE 1 
  GENERAL PROVISIONS

  
	
   

  	
  1.1

  	
  Relationship of Parties

  
	
   

  	
  1.2

  	
  General Conditions

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2 
  CONSTRUCTION MANAGER’S RESPONSIBILITIES

  
	
   

  	
  2.1

  	
  Preconstruction Phase

  
	
   

  	
  2.2

  	
  Guaranteed Maximum Price Proposal and
  Contract Time

  
	
   

  	
  2.3

  	
  Construction Phase

  
	
   

  	
  2.4

  	
  Professional Services

  
	
   

  	
  2.5

  	
  Unsafe
  Materials

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3 
  OWNER’S RESPONSIBILITIES

  
	
   

  	
  3.1

  	
  Information and Services

  
	
   

  	
  3.2

  	
  Owner’s Designated Representative

  
	
   

  	
  3.3

  	
  Architect

  
	
   

  	
  3.4

  	
  Legal Requirements

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4 
  COMPENSATION AND PAYMENTS FOR PRE-CONSTRUCTION PHASE SERVICES

  
	
   

  	
  4.1

  	
  Compensation

  
	
   

  	
  4.2

  	
  Payments

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5 
  COMPENSATION FOR CONSTRUCTION PHASE SERVICES

  
	
   

  	
  5.1

  	
  Compensation

  
	
   

  	
  5.2

  	
  Guaranteed Maximum Price

  
	
   

  	
  5.3

  	
  Changes in the Work

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6 
  COST OF THE WORK FOR CONSTRUCTION PHASE

  
	
   

  	
  6.1

  	
  Costs To be Reimbursed

  
	
   

  	
  6.2

  	
  Costs Not To Be Reimbursed

  
	
   

  	
  6.3

  	
  Discounts, Rebates and Refunds

  
	
   

  	
  6.4

  	
  Accounting Records

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7 
  CONSTRUCTION PHASE

  
	
   

  	
  7.1

  	
  Progress Payments

  
	
   

  	
  7.2

  	
  Final
  Payment

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8 
  INSURANCE AND BONDS

  
	
   

  	
  8.1

  	
  Insurance Required of the Construction
  Manager

  
	
   

  	
  8.2

  	
  Insurance Required of the Owner

  
	
   

  	
  8.3

  	
  Performance Bond and Payment Bond

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9 
  MISCELLANEOUS PROVISIONS

  
	
   

  	
  9.1

  	
  Dispute Resolution for the Preconstruction
  Phase

  
	
   

  	
  9.2

  	
  Dispute Resolution for the Construction
  Phase

  
	
   

  	
  9.3

  	
  Other
  Provisions

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10 
  TERMINATION OR SUSPENSION

  
	
   

  	
  10.1

  	
  Termination Prior to Establishing
  Guaranteed Maximum Price

  
	
   

  	
  10.2

  	
  Termination Subsequent to Establishing
  Guaranteed Maximum Price

  
	
   

  	
  10.3

  	
  Suspension

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11 
  OTHER CONDITIONS AND SERVICES

  
	
   

  
	
  Attachments:

  	
  AMENDMENT
  NO. 1 to Agreement Between Owner and Construction Manager.

  
				

 

 

2

Standard Form of Agreement Between Owner and Construction

 

Manager Where the Construction Manager is
also the Constructor

 

ARTICLE
1

GENERAL PROVISIONS

 

1.1        RELATIONSHIP OF PARTIES

 

The
Construction Manager accepts the relationship of trust and confidence
established with the Owner by this Agreement, and covenants with the Owner to
furnish the Construction Manager’s reasonable skill and judgment and to
cooperate with the Architect in furthering the interests of the Owner.  The Construction Manager shall furnish
construction administration and management services and use the Construction
Manager’s best efforts to perform the Project in an expeditious and economical
manner consistent with the interest of the Owner.  The Owner shall endeavor to promote harmony and cooperation among
the Owner, Architect, Construction Manager and other persons or entities
employed by the Owner for the Project.

 

1.2        GENERAL CONDITIONS

 

For
the Preconstruction Phase and Construction Phase, the General Conditions
of the Contract shall be the 1987  1997 Edition of ALA Document
A201, General Conditions of the Contract for Construction, which is attached
hereto and made a part hereof as Attachment 1,  incorporated herein by
reference.  For the Preconstruction
Phase, or in the event that the Preconstruction and Construction Phases proceed
concurrently, AIA Document A201 shall apply to the Preconstruction Phase only
as specifically provided in this Agreement.  The term “Contractor” as used in AIA Document A201, attached
hereto and made a part hereof as Attachment 1, shall mean the “Construction
Manager” or “Constructor”.

 

ARTICLE 2

CONSTRUCTION MANAGER’S

RESPONSIBILITIES

 

The
Construction Manager shall perform the services described in this Article.  The services to be provided under Paragraphs
2.1 and 2.2 constitute the Preconstruction Phase services.  If the Owner and Constitution Manager agree,
after consultation with the Architect, the Construction Phase may commence
before the Preconstruction Phase is completed, in which case both phases shall
proceed concurrently.

 

2.1        PRECONSTRUCTION PHASE

 

2.1.1     PRELIMINARY EVALUATION

 

The
Construction Manager shall provide a preliminary evaluation of  the Owner’s program and Project budget
requirements, each in terms of the other.

 

2.1.2     CONSULTATION

 

The
Construction Manager with the Architect shall jointly schedule and attend
regular meetings with the Owner and Architect. 
The Construction Manager shall consult with the Owner and Architect
regarding site use and improvements, and the selection of materials, building
systems and equipment.  The Construction
Manager shall provide recommendations on construction feasibility; actions
designed to minimize adverse effects of labor or material shortages; time
requirements for procurement, installation and construction completion; and
factors related to construction cost including estimates of alternative designs
or materials, preliminary budgets and possible economies, and a cash flow
schedule (“Cash Flow Schedule”), showing the timing and amounts of cash flow
necessary from Owner for completion of the Project on time.  The Cash flow Schedule shall be updated
along with any updates of the Project schedule or as may be otherwise
reasonably requested by Owner.

 

2.1.3     PRELIMINARY PROJECT SCHEDULE

 

When
Project requirements described in Subparagraph 3.1.1 have been sufficiently
identified, the Construction manager shall prepare, and periodically update, a
preliminary Project schedule for the Architect’s review and the Owner’s
approval.  The Construction Manager
shall obtain the Architect’s approval of the portion of the preliminary Project
schedule relating to the performance of 
the Architect’s services.  The
Construction Manager shall coordinated and integrate the preliminary Project
schedule with the services and activities of the Owner, Architect and
Construction Manager.  As design
proceeds, the preliminary Project schedule shall be updated to indicate
proposed activity sequences and durations, milestone dates for receipt and
approval of pertinent information, submittal of a Guaranteed Maximum Price
proposal, preparation and processing of shop drawings and samples, delivery of
materials or equipment requiring long-lead time procurement, Owner’s occupancy
requirements showing portions of the Project having occupancy priority, and proposed
date of Substantial Completion.  If
preliminary Project schedule updates indicate that previously approved
schedules may not be met, the Construction Manager shall make appropriate
recommendations to the Owner and Architect.

 

2.1.4     PHASED CONSTRUCTION

 

The
Construction Manager shall make recommendations to the Owner and Architect
regarding the phased issuance of Drawings and Specifications to facilitate
phased construction of the Work, if such phased construction is appropriate for
the

 

3

 

Project,
taking into consideration such factors as economies, time of performance,
availability of labor and materials, and provisions for temporary facilities.

 

2.1.5     PRELIMINARY COST ESTIMATES

 

2.1.5.1  When the Owner has sufficiently identified the Project requirements
and the Architect has prepared other basic design criteria, the Construction
Manager shall prepare, for the review of the Architect and approval of the
Owner, a preliminary cost conceptual estimate utilizing area,
volume or similar conceptual estimating techniques.

 

2.1.5.2  When Schematic Design Documents have been prepared by the Architect
and approved by the Owner, the Construction Manager shall prepare for the
review of the Architect and approval of the Owner, a more detailed  schematic
estimate with supporting data. 
During the preparation of the Design Development Documents, the
Construction Manager shall update and refine this estimate at appropriate
intervals agreed to by the Owner, Architect and Construction Manager.

 

2.1.5.3  When Design Development Documents have been prepared by the
Architect and approved by the Owner, the Construction Manager shall prepare a detailed
design development estimate with supporting data for review by the
Architect and approval by the Owner. During the preparation of the Construction
Documents, the Construction Manager shall update and refine this estimate at
appropriate intervals agreed to by the Owner, Architect and Construction
Manager.

 

2.1.5.4  If any estimate submitted to the Owner exceeds previously approved
estimate or the Owner’s budget, the Construction Manager shall make appropriate
recommendations to the Owner and Architect.

 

2.1.6     SUBCONTRACTORS AND SUPPLIERS

 

The Construction Manager shall
seek to develop subcontractor interest in the Project and shall furnish to the
Owner and Architect for their information a list of possible subcontractors,
including suppliers who are to furnish materials or equipment fabricated to a
special design, from whom proposals will be requested for each principal
portion of the Work.  The Architect will
promptly reply in writing to the Construction Manager if the Architect or Owner
know of any objection to such subcontractor or supplier.  The receipt of such list shall not require
the Owner or Architect to investigate the qualifications of proposed
subcontractors or suppliers, nor shall it waive the right of the Owner or
Architect later to object to or reject any proposed subcontractor or supplier.

 

2.1.7     LONG-LEAD TIME ITEMS

 

The Construction Manager shall
recommend to the Owner and Architect a schedule for procurement of long-lead
time items which will constitute part of the Work as required to meet the
Project schedule.  If such long-lead
time items are procured by the Owner, they shall be procured on terms and
condition acceptable to the Construction Manager.  Upon the Owner’s acceptance of the Construction Manager’s
Guaranteed Maximum Price proposal, all contracts for such items shall be assigned
by the Owner to the Construction Manager, who shall accept responsibility for
such items as if procured by the Construction Manager.  The Construction Manager shall expedite the
delivery of long-lead time items.

 

2.1.8     EXTENT OF RESPONSIBILITY

 

The Construction Manager does
not warrant or guarantee estimate and schedules except as may be included as
part  of the Guaranteed Maximum
Price.  Te recommendations and advice of
the Construction Manager concerning design alternatives shall be subject to the
review and approval of the Owner and the Owner’s professional consultants.  It is not the Construction Manager’s
responsibility to ascertain that the Drawings and Specifications are in
accordance with applicable laws, statutes, ordinances, building codes, rules
and regulations.  However, if the Construction
Manager recognizes that portions of the Drawings and Specifications are at
variance therewith, the Construction Manager shall promptly notify the
Architect and Owner in writing.

 

2.1.9     EQUAL EMPLOYMENT OPPORTUNITY AND AFFIRMATIVE ACTION

 

The Construction Manager shall
comply with applicable laws, regulations and special requirements of the
Contract Documents regarding equal employment opportunity and affirmative
action programs.

 

2.2        GUARANTEED MAXIMUM PRICE PROPOSAL AND
CONTRACT TIME

 

2.2.1                        When
the Drawings and Specifications are sufficiently complete. When the
construction drawings and specifications are 60% complete and the Owner’s
intent is 100% identified, the Construction Manager shall propose a
Guaranteed Maximum Price (“GMP”), which shall be the sum of the
estimated Cost of the Work and the Construction Manager’s Fee.  As of the date execution hereof by
Construction Manager, which date is indicated on the signature page of this
Agreement the parties hereto agree that the GMP is $42,913,834.00.

 

2.2.2                        As
the Drawings and Specifications may not be finished at the time the Guaranteed
Maximum Price proposal is prepared, the Construction Manager shall provide in
the Guaranteed Maximum Price for further development of the Drawings and
Specifications by the Architect that is consistent with the Contract Documents
and reasonably inferable therefrom. 
Such further development does not include such things as changes in
scope, systems, kinds and quality of materials, finishes or equipment, all of
which, if required, shall

 

4

 

be incorporated by Change
Order; provided however, any charges to the Owner by the Architect, any
subcontractors or any consultants for additional labor services or materials
caused by or resulting from the act or omission of the Constructor, including
without limitation, charges for charges to the Work necessitated by any act or
omission of the Constructor which do not meet the terms of the Contract
Documents, and any charges for remedial repairs which may be required as the
result thereof, or for excessive claims, or shop drawings or submittals beyond
the number reasonably anticipated on a project similar in scope shall be paid
by the Constructor and not come from the Construction Manager’s Contingency
provided that such claims shop drawings or submittals do not result from the
Architect’s errors and omissions.

 

2.2.3     The estimated Cost of the Work shall include the “Construction
Manager’s Contingency” which shall equal a sum equal to 5% of the GMP
excluding the Construction Manager’s Fee, and shall be for the Construction
Manager’s use to cover  a  sum established by the Construction
Manager for the Construction Manager’s exclusive use to cover costs arising
under Subparagraph. 2.2.2 and other costs which are properly reimbursable
as Cost of the Work but not the basis for a Change Order.  The use of any of the Construction
Manager’s Contingency shall be specifically set out in each monthly requisition
for Owner’s and Architect’s review in accordance with the Contract
Documents.  Provided that the
Constructor has given the Owner prior written notice of the Constructor’s
Intent to take actions or to incur costs which will be charged to the
Construction Manager’s Contingency and the Owner has not objected to the
proposed action or cost within seven (7) business days of receipt of the
Constructor’s notice the Construction Manager’s Contingency may be applied in
accordance herewith and as proposed by the Construction Manager.

 

2.2.4     BASIS OF GUARANTEED MAXIMUM PRICE

 

The Construction Manager shall
include with the Guaranteed Maximum Price proposal a written statement of its
basis, which shall include:

 

.1               A list of Drawings and Specifications,
including all addenda thereto and the Conditions of the Contract, which were
used in preparation of the Guaranteed Maximum Price proposal.

 

.2               A detailed list and description of
allowances and statement of their basis.

 

.3               A list of the clarifications and
assumptions made by the Construction Manager in the preparation of the
Guaranteed Maximum Price proposal to supplement the information contained in
the Drawings and Specifications.

 

.4               The proposed Guaranteed Maximum Price,
including a statement of the estimated cost, consolidated and summarized by
trade categories, allowances contingency and other items (as well as the
detailed breakdown of the casino component of the Project and the hotel
component of the Project and the fees that comprise the Guaranteed Maximum
Price). organized by trade categories, allowances, contingency, and
other items and the fee that comprise the Guaranteed Maximum Price.

 

.5               The Date of Substantial Completion, as
well as all other dates,  upon which
the proposed Guaranteed Maximum Price is based, and a schedule of the
Construction Documents issuance date upon which the date of substantial
Completion, and other benchmark dates are  is based.

 

2.2.5     The Construction Manager shall meet with the Owner and Architect
to review the Guaranteed Maximum Price proposal and the written statement of
its basis. In the event that the Owner or Architect discovers any
inconsistencies or inaccuracies in the information presented, they shall
promptly notify the Construction Manager, who shall make appropriate
adjustments to the Guaranteed Maximum Price proposal, its basis or both.

 

2.2.6     Unless the Owner accepts the Guaranteed Maximum Price proposal
in writing on or before the date specified in the proposal for such acceptance
and so notifies the Construction Manager, the Guaranteed Maximum Price proposal
shall not be effective without written acceptance by the Construction Manager.

 

2.2.7     Prior to the Owner’s acceptance of the Construction Manager’s
Guaranteed Maximum Price proposal and issuance of a Notice to Proceed, the
Construction Manager shall not incur any cost to be reimbursed as part of the
Cost of the Work  except as the Owner
may specifically authorize in writing.

 

2.2.8     Upon acceptance by the Owner of the Guaranteed Maximum Price
proposal, the Guaranteed Maximum Price and its basis shall be set forth in
Amendment No. 1.  The Guaranteed Maximum
Price shall be subject to additions and deductions by a change in the Work as
provided in the Contract Document and the date of Substantial Completion shall
be subject to adjustment as provided in the Contract Documents.

 

2.2.9     The Owner shall authorize and cause the Architect to

 

5

 

revise the Drawings and
Specifications to the extent necessary to reflect the agreed-upon assumptions
and clarifications contained in Amendment No. 1.  Such revised Drawings and Specifications shall be furnished to
the Construction Manager in accordance with schedules agreed to by the Owner,
Architect and Construction Manager.  The
Construction Manager shall promptly notify the Architect and Owner if such
revised Drawings and Specifications are inconsistent with agreed-upon
assumptions and clarifications.

 

2.2.10   The Guaranteed Maximum Price shall include in the Cost of the Work
only those taxes which are enacted at the time the Guaranteed Maximum Price is
established.

 

2.3        CONSTRUCTION PHASE

 

2.3.1     GENERAL

 

2.3.1.1  The Construction Phase shall commence on the earlier of :

	
  (1)

  	
   

  	
  the Owner’s
  acceptance of the Construction Manager’s Guaranteed Maximum Price proposal
  and issuance of a Notice to Proceed, or

  	 

	
  (2)

  	
   

  	
  the Owner’s
  first authorization to the Construction Manager to:

  	 

	
   

  	
  (a)

  	
  award a
  subcontract, or

  
	
   

  	
  (b)

  	
  undertake
  construction Work with the Construction Manager’s own forces, or

  
	
   

  	
  (c)

  	
  issue a
  purchase order for material or equipment required for the work.

  
					

 

2.3.2     ADMINISTRATION

 

2.3.2.1  Those portions of the Work that the Construction Manager does not
customarily perform with the Construction Manager’s own personnel shall be
performed under Manager’s own personnel shall be performed under subcontracts
or by other appropriate agreements with the Construction Manager, as
reviewed and approved by the Owner, in generally the form of subcontract
annexed hereto and made a part hereof as Attachment II. For any contracts which
may have been entered into by Owner prior to the execution hereof by Owner and
Construction Manager.  Owner shall
assign such contracts to Construction Manager and Construction Manager shall
assume such contracts in form of Assignment/Assumption Agreement annexed hereto
and made made a part hereof as Attachment III.  Construction Manager The Construction Manager shall obtain
bids from Subcontractors and from suppliers of materials or equipment
fabricated to a special design for the Work from the list previously reviewed
and, after analyzing such bids, shall deliver such bids to the Owner and
Architect.  The Owner shall then
determine, with the advice and approval of the Construction Manager and
subject to the reasonable objection of the Architect, which bids will be
accepted.  The Owner may designate
specific persons or entities from whom the Construction Manager shall obtain
bids; however, if the Guaranteed Maximum Price has been established, the Owner
may not prohibit the Construction Manager from obtaining bids from other
qualified bidders.  The Construction
Manager Construction Manager shall not be required to be required to contract
with anyone to whom the Construction Manager has reasonable objection.  The Construction Manager understands and
agrees that it must enter into such contracts with subcontractors and suppliers
as is necessary to complete the Work. 
The Construction Manager may self-perform when competent qualified
trades are unavailable or their costs are such that it puts the Guaranteed
Maximum Price in jeopardy.  In either
case the Owner must approve any self performance by the Construction
Manager.  The Constructor shall be
responsible for the quality and quantities of its Work and the Work of all
subcontractors.  The Constructor shall
maintain a competent full-time staff at the Site for coordinating and
inspecting the quality and quantity of the Work.  The Owner shall have the right to require the Constructor and any
of the subcontractors to replace any on-site personnel that it finds
objectionable with other staff available to the Constructor and approved by the
Owner.

 

2.3.2.2  If the Guaranteed Maximum Price has been established and a specific
bidder among those whose bids are delivered by the Construction Manager to the
Owner and Architect (1) is recommended to the Owner by the Construction
Manager; (2) is qualified to perform that portion of the Work; (3) has
submitted a bid which conforms to the requirements of the Contract Documents
without reservations or exceptions, but the Owner requires that another bid be
accepted, then the Construction Manager may require that a change in the Work
be issued to adjust the Contract Time and the Guaranteed Maximum Price by the
difference between the bid of the person or entity recommended to the Owner by
the Construction Manager and the amount of the subcontract or other agreement
actually signed with the person or entity designated by the Owner.

 

2.3.2.3  Subcontracts and agreements with suppliers
furnishing materials or equipment fabricated to a special design shall conform
to the payment provisions of Subparagraphs 7.1.8 and 7.1.9 and shall not be
awarded on the basis of cost plus a fee without the prior consent of the Owner.
2.3.2.3  Subcontracts and agreements
with suppliers furnishing materials or equipment fabricated to a special design
shall conform to the payment provisions of Subparagraphs 7.1.8 and 7.1.9 and
shall not be awarded on the basis of cost plus a fee without the prior consent
of the Owner

 

2.3.2.4  The Construction Manager shall schedule and conduct meeting at
which the Owner, Architect, Construction Manager and appropriate Subcontractors
can discuss the status of the Work.  The
Construction Manager shall prepare and promptly distribute meeting minutes which
shall not be

 

6

 

distributed to
any participant or third party until approved by the Owner.

 

2.3.2.5  Promptly after the Owner’s acceptance of the Guaranteed Maximum
Price proposal, the Construction Manager shall prepare a schedule in accordance
with Paragraph 3.10 of AIA Document A201, attached as Attachment I,
including the Owner’s occupancy requirements.

 

2.3.2.6  The Construction Manager shall provide monthly written reports to
the Owner and Architect on the progress of the entire Work.  The Construction Manager shall maintain a
daily log containing a record of weather, Subcontractors working on the site,
number of workers, Work accomplished, problems encountered and other similar
relevant data as the Owner may reasonably require.  The log shall be available to the Owner and Architect.

 

2.3.2.7  The Construction Manager shall develop a system of cost control for
the Work, including regular monitoring of actual costs for activities in
progress and estimates for uncompleted tasks and proposed changes.  The Construction Manager shall identify
variances between actual and estimated costs and report the variances to the
Owner and Architect at regular intervals.

 

2.3.4     The Constructor shall perform the Work at
the most favorable cost to the Owner, but in no event shall it exceed the GMP
approved by the Owner and Constructor.

 

2.4        PROFESSIONAL SERVICES

 

The Construction Manager shall
not be required to provide professional services which constitute the practice
of architecture or engineering unless such services are specifically required
by the Contract Documents for a portion of the Work or unless the Construction
Manager has specifically agreed in writing to provide such services.  In such event, the Construction Manager shall
cause such services to be performed by appropriately licensed professionals.

 

2.5        UNSAFE MATERIALS

 

In addition to the provisions
of Paragraph 10  Article 10 in ALA Document A201, attached as
Attachment 1, if reasonable precautions will be inadequate to prevent
foreseeable bodily injury or death to persons resulting from a material or
substance encountered but not created on the site by the Construction Manager,
the Construction Manager shall, upon recognizing the condition, immediately
stop Work in the affected in writing. 
The Owner, Construction Manager and Architect shall then proceed in the
same manner described in Subparagraph 10.1.2 Article 10 of
AIA Document A201, attached as Attachment 1.  The Owner shall be responsible for obtaining the services of a
licensed laboratory to verify the presence or absence of the material or
substance reported by the Construction Manager and, in the event such material
or substance is found to be present, to verify that it has been rendered
harmless.  Unless otherwise required by
the Contract Documents, the Owner shall furnish in writing to the Construction
Manager and Architect the names and qualifications of persons or entities who
are to perform tests verifying the presence or absence of such material or
substance or who are to perform the task of removal or safe containment of such
material or substance.  Such services
shall be performed for the Construction Manager as a subcontractor thereof
pursuant to a Change Order, if the Construction Manager has reasonable
objection to the persons or entities proposed by the Owner, Owner shall propose
another to whom the Construction Manager has no reasonable objection.  The Construction Manager and
Architect will promptly reply to the Owner in writing stating whether or not
either has reasonable objection to the persons or entities proposed by the
Owner.  If either the Construction
Manager or Architect has an objection to a person or entity proposed by the
Owner, the Owner shall propose another to whom the Construction Manager and
Architect have no reasonable objection.

 

ARTICLE 3

OWNER’S RESPONSIBILITIES

 

3.1        INFORMATION AND SERVICES

 

3.1.1     The Owner shall provide full information in a timely manner
regarding the requirements of the Project, including a program which sets forth
the Owner’s objectives, constraints and criteria, including space requirements
and relationships, flexibility and expandability requirements, special
equipment and systems, and site requirements.

 

3.1.2     The Owner, upon written request from the Construction Manager,
shall furnish evidence of Project financing prior to the start of the
Construction Phase and from time to time thereafter as the Construction Manager
may request.  Furnishing of such
evidence shall be a condition precedent to commencement or continuation of the
Work.

 

3.1.3     The Owner shall establish and the Owner shall update an
overall budget for the Project, and such budget for the Project shall be
maintained by the Owner, including but not limited to breakdowns in the budget
for hard costs, soft costs, contingencies for changes in the Work, and other
costs which are the responsibility of Owner. 
The Construction Manager shall prepare and maintain a GMP budget, based
on consultation with the Construction Manager  Owner and
Architect. which shall include contingencies for changes in the Work and
other costs which are the responsibility of the Owner.

 

7

 

3.1.4     STRUCTURAL AND ENVIRONMENTAL TESTS, SURVEYS AND REPORTS

 

In the Preconstruction Phase,
the Owner shall furnish the following with reasonable promptness and at the
Owner’s expense, and the Construction Manager shall be entitled to rely upon
the accuracy of any such information, reports, surveys, drawings and tests
described in Clauses 3.1.4.1 through 3.1.4.4, except to the extent that the
Construction Manager knows of any inaccuracy:

 

3.1.4.1  Reports, surveys, drawings and tests concerning the conditions of
the site which are required by law.

 

3.1.4.2  Surveys describing physical characteristics, legal limitations and
utility locations for the site of the Project, and a written legal description
of the site.  The surveys and legal
information shall include, as applicable, grades and lines of streets, alleys,
pavements and adjoining property and structures; adjacent drainage; right-of-way,
restrictions, easements, encroachments, zoning, deed restrictions, boundaries
and contours of the site; locations, dimensions and necessary data pertaining
to existing buildings, other improvements and trees; and information concerning
available utility services and lines, both public and private, above and below
grade, including inverts and depths. 
All information on the survey shall be referenced to a project
benchmark.

 

3.1.4.3  The services of geotechnical engineers when such services are
requested by the Construction Manager. 
Such services may include but are not limited to test borings, test
pits, determinations of soil bearing values, percolation tests, evaluations of
hazardous materials, ground corrosion and resistivity tests, including
necessary operations for anticipating subsoil conditions, with reports and
appropriate professional recommendations.

 

3.1.4.4  Structural, mechanical, chemical, air and water pollution tests,
tests for hazardous materials, and other laboratory and environmental tests,
inspections and reports which are required by law.

 

3.1.4.5  The services of other consultants when such services are reasonably
required by the scope of the Project and are requested by the Construction
Manager.

 

3.2        OWNER’S DESIGNATED REPRESENTATIVE

 

The Owner shall designate in
writing a representative who shall have express authority to bind the Owner
with respect to all matters requiring the Owner’s approval or
authorization.  This representative
shall have the authority to make decisions on behalf of the Owner concerning
estimates and schedules, construction budgets, and changes in the Work, and
shall render such decisions promptly and furnish information expeditiously, so
as to avoid unreasonable delay in the services or Work of the Construction Manager.  The Owner’s Representative until and
unless the Owner designates otherwise is hereby designated to be Roy Olsen,
except for purposes of executing Change Orders or Amendments to this Agreement
which Change Orders and Amendments shall be executed by Mr. Michael Corbin
or any statutory officer of Owner.

 

3.3        ARCHITECT

 

The Owner shall retain an
Architect to provide the Basic Services, including normal structural,
mechanical and electrical engineering services, other than cost estimating
services, described in the editions of AIA Document B141 current as of the date
of this Agreement.  The Owner shall
authorize and cause the Architect to provide those Additional Services
described in AIA Document B141 requested by the Construction Manager which must
necessarily be provided by the Architect for the Preconstruction and
Construction Phases of the Work.  Such
services shall be provided in accordance with time schedules agreed to by the
Owner, Architect and Construction Manager. 
Upon request of the Construction Manager, the Owner shall furnish to the
Construction Manager a copy of the Owner’s Agreement with the Architect, from
which compensation provision may be deleted.

 

3.4        LEGAL REQUIREMENTS

 

The Owner shall determine and
advise the Architect and Construction Manager if any special legal requirements
relating specifically to the Project which differ from those generally
applicable to construction in the jurisdiction of the Project.  The Owner shall furnish such legal services
as are necessary to provide the information and services required under
Paragraph 3.1.

 

ARTICLE 4

COMPENSATION AND PAYMENTS FOR PRECONSTRUCTION PHASE SERVICES

 

The Owner shall compensate and
make payments to the Construction Manager for Preconstruction Phase services as
follows:

 

4.1        COMPENSATION

 

4.1.1     For the services described in Paragraphs 2.1 and 2.2 the
Construction Manager’s compensation shall be calculated as follows: The
Construction Manager will be compensated for the services described in
Paragraphs 2.1 and 2.3 which services include without limitation, the
following:

(State basis of compensation, whether a stipulated sum, multiple of
Direct Personnel Expense, actual cost, etc., Include a statement of
reimbursable cost items as applicable.)

 

8

 

(i)      Preliminarily evaluation of the Owner’s
program schedule and construction budget and requirements:

(ii)     Prepare preliminary cost
estimates:

(iii)    Provide cost evaluations,
value engineering and use of alternative materials and systems:

(iv)   Prepare proposed Project
schedule:

(v)    Monitor the estimates of
the costs as they relate to the Project budget and make recommendations for
meeting budgetary restraints:

(vi)   Review and design documents
during their development by the Architect and advise the Owner with respect to
issues such as constructability, selection of materials, building systems and
equipment and time and cost considerations:

(vii)  Prepare a job safety
program:

(viii) Coordinate required
property surveys, testing and inspections necessary to properly plan the
Project:

(ix)    Assist the Owner in
selecting and retaining additional professional and consulting services where
necessary or appropriate: and

(x)     Provide the Owner with the
Guaranteed Maximum Price described in Paragraph 2.2 of this Agreement.

 

4.1.2     Compensation for Preconstruction Phase services shall be
equitably adjusted if such services extend beyond from the date of this
Agreement or if the originally contemplated scope of services is significantly
modified  Compensation for Preconstruction Phase Services shall be as set
forth in the GMP Presentation.

 

4.1.3     If compensation is based on a multiple of Direct Personal
Expense, Direct Personnel Expense is defined as the direct salaries of the
Construction Manager’s personnel engaged in the Project and the portion of the
cost of their mandatory and customary contributions and benefits related
thereto, such as employment taxes and other statutory employee benefits,
insurance, sick leave, holidays, vacations, pensions and similar contributions
and benefits Preconstruction Phase Services shall be performed and
billed on a cost basis as set forth in the GMP Presentation.

 

4.1.4     The Owner will reimburse the Construction Manager for the
following expenses incurred to third parties: (i) up to a maximum of $15,000
payable to Dick Baer Associates for consulting fees Incurred in preparing a
parallel estimate and (ii) up to a maximum $25,000 payable to a casino cost
consultant mutually aceptable to the Owner and the Construction Manager for the
development of casino theme cost allowances. 
Such amounts shall be included in the GMP Presentation.

 

4.1.5     Reimbursable expenses to the Construction Manager for
Preconstruction Phase Services, shall include long-distance telephone charges,
out-of-town travel and out-of-town mileage (travel and mileage beyond a radius
of 25 miles from the Construction Manager’s main office), printing and other
out-of-pocket expenses, and shall be billed to Owner at cost to the
Construction Manager.  Such amounts
shall be included in the GMP Presentation.

 

4.2        PAYMENTS

 

4.2.1     Payments shall be made monthly following presentation of the
Construction Manager’s invoice and, where applicable, shall be in proportion to
services performed Payments shall be made within thirty (30) days after
invoicing by the Construction Manager 
for Preconstruction Phase Services rendered in the manner reasonably
acceptable to Owner.  No retainage will
be withheld on Preconstruction Services.

 

4.2.2     Payments are due and payable forty-five (45) days form
the date the Construction Manager’s invoice is received by the Owner.  Amounts unpaid after the date on which
payment is due shall bear interest at the rate entered below, or in the absence
thereof, at the legal rate prevailing from time to time at the place where the
Project is located.

(Insert rate of interest agreed upon.)

The “prime
rate” of interest as reported in the Wall Street Journal from time to time.

 

(Usually laws and requirements under the Federal Truth in Lending Act,
similar state and local consumer credit laws and other regulations at the
Owner’s and Construction Manager’s principal places of business, the location
of the Project and elsewhere may affect the validity of this provision. Legal
advice should be obtained with respect to deletions or modifications, and also
regarding requirements such as written disclosures or waivers)

 

ARTICLE 5

COMPENSATION FOR CONSTRUCTION PHASE SERVICES

 

The Owner shall compensate the
Construction Manager for Construction Phase services as follows:

 

9

 

5.1        COMPENSATION

 

5.1.1     For the Construction Manager’s performance of the Work as
described in Paragraph 2.3, the Owner shall pay the Construction Manager in
current funds the Contract Sum consisting of the Cost of the Work as defined in
Article 7 and the Construction Manager’s Fee determined as follows:

(State a lump sum, percentage of actual Cost of the Work or other
provision for determining the Construction Manager’s Fee, and explain how the
Construction Manager’s Fee is to be adjusted for changes in the Work.)

Construction
Manager’s Fee shall be Five Percent (5%) of the final adjusted “Cost of the
Work” as defined in Article 6.

 

5.2        GUARANTEED MAXIMUM PRICE

 

5.2.1     The sum of the Cost of the Work and the Construction Manager’s
Fee are guaranteed by the Construction Manager not to exceed the amount
provided in Amendment No. 1, subject to additions and deductions by changes in
the Work as provided in the Contract Documents.  Such maximum sum as adjusted by approved changes in the Work is
referred to in the Contract Document as the Guaranteed Maximum Price or GMP.
 Costs which would cause the
Guaranteed Maximum Price to be exceeded shall be paid by the Construction
Manager without reimbursement by the Owner.

(Insert specific provisions if the Construction Manager is to
participate in any savings.)

 

5.3        CHANGES IN THE WORK

 

5.3.1     Adjustments to the Guaranteed Maximum Price on account of
changes in the Work subsequent to the execution of Amendment No. 1 may be determined
by any of the methods listed in Subparagraph 7.3.3 of AIA Document A201 attached
as Attachment 1.

 

5.3.2     In calculating adjustments to subcontracts (except those awarded
with the Owner’s Owner’s prior consent on the basis of cost plus
a fee), the terms “cost” and “fee” as used in Clause 7.3.3.3 of AIA Document
A201 attached as Attachment 1, and the terms “costs” and “a reasonable
allowance for overhead and profit” as used in Subparagraph 7.3.6 of AIA
Document A201, attached as Attachment I, shall have the meanings
assigned to them in that document and shall not be modified by this Article
5.  Adjustments to subcontracts awarded
with the Owner’s Owner’s prior consent on the basis of cost plus
a fee shall be calculated in accordance with the terms of those subcontracts.

 

5.3.3     In calculating adjustments to the Contract, the terms “cost” and
“costs” as used in the above-referenced provisions of AIA Document A201 attached
as Attachment 1.  shall mean the
Cost of the Work as defined in Article 6 of this Agreement and the terms “and a
reasonable allowance for” overhead and profit” shall be limited to meanthe Construction Manager’s Fee of 5% of the Cost of the Work as
defined in subparagraph 5.1.1 of this Agreement.

 

5.3.4     If no specific provision is made in Subparagraph 5.1.1 for
adjustment of the Construction Manager’s Fee in the case of changes in the
Work, or if the extent of such changes is such, in the aggregate, that
application of the adjustment provisions of Subparagraph 5.1.1 will cause
substantial inequity to the Owner or Construction Manager, the Construction
Manager’s Fee shall be equitably adjusted on the basis of the fee established
for the original Work.

 

ARTICLE 6

COST OF THE WORK OF CONSTRUCTION PHASE

 

6.1        COSTS TO BE REIMBURSED

 

6.1.1     The term “Cost of the Work” shall mean costs necessarily
incurred by the Construction Manager Constructor in the proper
performance of the Work.  Work. Such costs shall be at rates not
higher than those customarily paid at the place of the Project except with prior
consent of the Owner  Owner.  The Cost of the Work shall include only the items set Forth in
this Article 6,  The Cost of the Work
shall be subject to prior mutual agreement of the Owner and the Constructor.

 

6.1.2     LABOR COSTS

 

.1               Wages of construction workers directly
employed by the Construction Manager to perform the construction of the Work at
the site or, with the Owner’s agreement, at off-site workshops.

 

.2               Wages or salaries of the Construction
Manager’s supervisory and administrative personnel when stationed at the site
with

 

10

 

the Owner’s
agreement as identified in Paragraph 11.2 hereof.

(If it is intended that the wages or salaries
of certain personnel stationed at the Construction Manager’s Principal office
or offices other than the site office shall be included in the cost of the
Work, such personnel shall be identified below.)

 

.3              Wages and salaries of the Construction
Manager’s supervisory or administrative personnel engaged, at factories, workshops
or on the road, in expediting the production or transportation of materials or
equipment required for the Work, but only for that portion of their time
required for the Work.

 

.4                Costs paid or incurred by the
Construction Manager for taxes, insurance, contributions, assessments and
benefits required by law or collective bargaining agreements, and, for
personnel not covered by such agreements, customary benefits such as sick
leave, medical and health benefits, holidays, vacations and pensions, provided
that such costs are based on wages and salaries included in the Cost of the
Work under Clauses 6.1.2.1 through 6.1.2.3.

 

6.1.3     SUBCONTRACT COSTS

 

Payments made by the
Construction Manager to Subcontractors shall be in accordance with the
requirements of the Article 7 hereof subcontracts.

 

6.1.4     COSTS OF MATERIALS AND EQUIPMENT INCORPORATED IN THE COMPLETED
CONSTRUCTION

 

.1                Costs, including transportation, of
materials and equipment incorporated or to be incorporated in the completed
construction.

 

.2                Costs of materials described in the
preceding, Clause 6.1.4.1 in excess of those actually installed but required to
provide reasonable allowance for waste and for spoilage. Unused excess
materials, if any, shall be handed over to the Owner at the completion of the
Work or, at the Owner’s option, shall be sold by the Construction Manager,
amounts realized, if any from such sales shall be credited to the Owner as a
deduction from the Cost of the Work.

 

6.1.5     COSTS OF OTHER MATERIALS AND EQUIPMENT, TEMPORARY FACILITIES AND
RELATED ITEMS

 

.1               Costs, including transportation,
installation, maintenance, dismantling and removal of materials, supplies,
temporary facilities, machinery, equipment, and hand tools not customarily
owned by the construction workers, which are provided by the Construction
Manager at the site and fully consumed in the performance of the Work; and cost
less salvage value or such items if not fully consumed, whether sold to others
or retained by the Construction Manager. Cost for items previously used by the
Construction Manager shall mean fair market value.

 

.2               Rental charges for temporary facilities,
machinery, equipment, and hand tools not customarily owned by the construction
workers, which are provided by the Construction Manager at the site, whether
rented from the Construction Manager or others, and costs of transportation,
installation, minor repairs and replacements, dismantling and removal thereof.
Rates and quantities of equipments rented shall be subject to the Owner’s prior
approval.

 

.3               Costs of removal of debris from the
site.

 

.4               Reproduction costs, costs of telegrams,
facsimile transmissions and long-distance telephone calls, postage and express
delivery charges, telephone service at the site and reasonable petty cash
expenses of the site office.

 

.5               That portion of the reasonable travel
and subsistence expenses of the Construction Manager’s personnel incurred while
traveling in discharge of duties connected with the Work.

 

6.1.6     MISCELLANEOUS COSTS

 

.1               That portion directly attributable to
this Contract of premiums for insurance and bonds.

(If charges for self insurance are to be
included, specify the basis for reimbursement.)

 

.2               Sales, use or similar taxes imposed by a
governmental authority which are related to the Work and for which the
Construction Manager is liable.

 

11

 

.3               Fees and assessments for the building
permit and for other permits, licenses and inspections for which the
Construction Manager is required by the Contract Documents to pay.

 

.4               Fees of testing laboratories for tests
required by the Contract Documents, except those related to nonconforming Work
other than that for which payment is permitted by Clause 6.1.8.2.

 

.5               Royalties and license fees paid for the
use of a particular design, process or product required by the Contract
Documents; the cost of defending suits or claims for infringement of patent
or other intellectual property rights arising from such requirement by the
Contract Documents; payments made in accordance with the legal judgments
against the Construction Manager resulting from such suits or claims and
payments of settlements made with the Owner’s consent; provided, however,
that such costs of legal defenses, judgments and settlements shall not be included
in the calculation of the Construction Manager’s Fee or the Guaranteed Maximum
Price and provided that such royalties, fees and costs are not excluded by the
last sentence of Subparagraph 3.17.1 of AIA Document A201, attached as
Attachment I, or other provisions of the Contract Documents.

 

.6               Data processing costs related to the
Work.

 

.7               Deposits lost for causes other than the
Construction Manager’s negligence or failure to fulfill a specific
responsibility to the Owner set forth in this Agreement.

 

.8               Legal, mediation and arbitration costs,
other than those arising from disputes between the Owner and Construction
Manager, reasonably incurred by the Construction Manager in the performance of
the Work and with the Owner’s written permission, which permission shall not be
unreasonably withheld.

 

.9               Expenses incurred in accordance with the
Construction Manager’s standard personnel policy for relocation and temporary
living allowances of personnel required for the Work, in case it is necessary
to relocate such personnel from distant locations.

 

6.1.7     OTHER COSTS

 

.1               Other costs incurred in the performance
of the Work if and to the extent approved in advance in writing by the Owner.

 

6.1.8     EMERGENCIES AND REPAIRS TO DAMAGED OR NONCONFORMING WORK

 

The cost of the Work shall also
include costs described in Subparagraph 6.1.1 which are incurred by the
Construction Manager.

 

.1               In taking action to prevent threatened
damage, injury or loss in case of an emergency affecting the safety of persons
and property, as provided in Paragraph 10.3 10.6 of AIA Document
A201 attached as Attachment I.

 

.2               In repairing or correcting damaged or
nonconforming Work executed by the Construction Manager or the Construction
Manager’s Subcontractors or suppliers, provided that such damaged or
nonconforming Work was not caused by the negligence or failure to fulfill a
specific responsibility to the Owner set forth in this Agreement of the
Construction Manager or the Construction Manager’s foremen, engineers or
superintendents, or other supervisory, administrative or managerial personnel
of the Construction Manager, or the failure of the Construction Manager’s
personnel to supervise adequately the Work of the Subcontractors or suppliers,
and only to the extent that the cost of repair of correction is not recoverable
by the Construction Manager from insurance, Subcontractors or suppliers.

 

6.1.9     The costs described in Subparagraphs 6.1.1 through 6.1.8 shall
be included in the Cost of the Work notwithstanding any provision of AIA
Document A201, attached as Attachment I, or other Conditions of the
Contract which may require the Construction Manager to pay such costs, unless
such costs are excluded by the provisions of Paragraph 6.2.

 

6.2        COSTS NOT TO BE REIMBURSED

 

6.2.1     The Cost of the Work shall not include:

 

.1               Salaries and other compensation of the
Construction Manager’s personnel stationed at the Construction Manager’s

 

12

 

principal
office or offices other than the Ssite office, except as otherwise
included in the GMP Presentation.  except
as specifically provided in Clauses 6.1.2.2 and 6.1.2.3.

 

.2               Expenses of the Construction Manager’s
principal office and offices other than the Ssite office except
as specifically provided in Paragraph 6.1.

 

.3               Overhead and general expenses, except as
may be expressly included in Paragraph 6.1.

 

.4               The Construction Manager’s capital
expenses, including interest on the Construction Manager’s capital employed for
the Work.

 

.5               Rental costs of machinery and equipment,
except as specifically provided in Subparagraph 6.1.5.2.

 

.6               Except as provided in Clause 6.1.8.2,
costs due to the negligence of the Construction Manager or to the failure of
the Construction Manager to fulfill a specific responsibility to the Owner set
forth in this Agreement.

 

.7               Costs incurred in the performance of
Preconstruction Phase Services.

 

.8               Except as provided in Clause 6.1.7.1,
any cost not specifically and expressly described in Paragraph 6.1.

 

.9               Costs which would cause the Guaranteed
Maximum Price to be exceeded.

 

6.3        DISCOUNTS, REBATES,  AND REFUNDS, AND
SAVINGS.

 

6.3.1     Cash discounts obtained on payments by the
Construction Manager shall accrue to the Owner if (1) before making the payment
the Construction Manager included them in an Application for Payment and
received payment therefor from the Owner or (2) the Owner has deposited funds
with the Construction Manager with which to make payments: otherwise, cash
discounts shall accrue to the Construction Manager, Savings on allowances which
are hereafter set forth in Amendment No. 1 hereto, trade discounts, rebates,
refunds and amounts received from sales of surplus materials and equipments
shall accrue 100% to the Owner, and the Construction Manager shall make
provisions so that such savings can be secured.

 

6.3.1     Cash discounts obtained on payments by
the Construction Manager shall accrue to the Owner if (1) before making the
payment, the Construction Manager included them in an Application for Payment
and received payment therefor from the Owner or (2) the Owner has deposited
funds with the Construction Manager with which to make payments; otherwise,
cash discounts shall accrue to the Construction Manager, trade discounts,
rebates, refunds and amounts received from sales of surplus materials and
equipment shall accrue to the Owner, and the Construction Manager shall make
provisions so that they can be secured.

 

6.3.2     Amounts which accrue to the Owner in
accordance with the provisions of Subparagraph 6.3.1 shall be credited to the Owner
as a deduction from the Cost of the Work.

 

6.3.3     Owner and Construction Manager agree that
if the Project is completed for less than the GMP as finally determined after
all scope of Work changes, that the first $1,650,000.00 in savings shall be
paid, 75% to Owner and 25% to Construction Manager, and that all savings in
excess of $1,650,000.00 shall be paid 75% to Construction Manager and 25% to
Owner. Additionally, as to furniture, fixtures, and equipment to be supplied by
Owner (“FF&E”), which Owner instead elects to have Construction Manager
provide any savings compared to Owner’s budget attached hereto and made a part
hereof as Attachment VII, will be shared on a per line item basis, 25% to
Construction Manager and 75% to Owner. No adjustments to the sharing formula
for such FF&E shall be made if the actual cost of such item of FF&E
exceeds such line item on the Owner’s budget attached as Attachment VII.

 

6.3.2     Amounts which accrue to the Owner in
accordance with the provisions of Subparagraph 6.3.1 shall be credited to the
Owner as a deduction from the Cost of the Work.

 

13

 

6.4        ACCOUNTING RECORDS

 

6.4.1     The Construction Manager shall keep full and detailed accounts
and exercise such controls as may be necessary for proper financial management
under this Contract; the accounting and control systems shall be satisfactory
to the Owner. The Owner and the Owner’s accountants shall be afforded access to
the Construction Manager’s records, books, correspondence, instructions,
drawings, receipts, subcontracts, purchase orders, vouchers, memoranda, and
other data relating to this Project, and the Construction Manager shall
preserve these for a period of three years after final payment, or for such
longer period as may be required by law.

 

ARTICLE 7

CONSTRUCTION PHASE

 

7.1        PROGRESS PAYMENTS

 

7.1.1     Based upon Application for Payment submitted to prepared
for the Architect and the Owner’s Representative by the Construction
Manager and Certificates for Payment issued by the Architect, upon approval
by the Owner’s Representative and receipt of lien waiversfrom subcontractors
and suppliers, the Owner shall make progress payments on account of the
Contract Sum to the Construction Manager as provided below and elsewhere in the
Contract Documents.

 

7.1.2     The period covered by each Application for Payment shall be one
calendar month ending on the last day of the month. or as follows.

 

7.1.3     Provided an Application for Payment is received by the Architect
Owner’s Representative not later than the fifth (5th) day of a
month, the Owner shall make progress payments to the Construction
Manager  to the Construction Manager not later than the fifteenth
(15th) day of the month. If an Application for Payment is received by the Architect
Owner’s Representative after the application date fixed above,
payment shall be made by the Owner not later than thirty (30) days after
the Architect  Owner’s Representative receives the Application for
Payment.

 

7.1.4     With each Application for Payment, the Construction Manager
shall submit payrolls, petty cash accounts, receipted invoices or invoices with
check vouchers attached, and any other evidence required by the Owner or
Architect to demonstrate that cash disbursements already made by the Construction
Manager on account  of the Cost of the
Work equal or exceed (1) progress payments already received by the Construction
Manager; less (2) that portion of those payments attributable to the
Construction Manager’s fees; plus (3) payrolls for the period covered by the
present Application for Payment.

 

7.1.5     Each Application for Payment shall be based upon the most
recent schedule of values submitted by the Construction Manager  most
recent schedule of values submitted by the Construction Manager in
accordance with the Contract Documents. The Construction Manager shall
include in such application for payment its General Conditions costs and fee
earned during that period. The schedule of values shall allocate the entire
Guaranteed Maximum Price among the various portions of the Work, except the
Construction Manager’s fee shall be shown as a separate item. The schedule of
values shall provide complete backup data to substantiate its accuracy, and be
in such form as the Architect and Owner may require. Such schedule, unless
objected to by the Architect or the Owner, shall be used as a basis for
reviewing the Construction Manager’s applications for payment.  The schedule of values shall allocate the
entire Guaranteed Maximum Price among the various portions of the Work except
that the Construction Manager’s Fee shall be shown as a single separate
item.  The schedule of values shall be
prepared in such form and supported by such data to substantiate its accuracy
as the Architect may require.  This
schedule, unless objected to by the Architect, shall be used as a basis for
reviewing the Construction Manager’s Applications for Payment.

 

7.1.6     Applications for Payment shall show the percentage completion of
each portion of the Work as of the end of the period covered by the Application
for Payment.  The percentage completion
shall be the lesser of (1) the percentage of that portion of the Work which has
actually been completed or (2) the percentage obtained by dividing (a) the
expense which has actually been incurred by the Construction Manager  Construction
Manager on account of that portion of the Work,  for which the
Construction Manager has made or intends to make actual payment prior to the
next Application for Payment by (b) the share of the Guaranteed Maximum
Price allocated to that portion of the Work in the schedule of values.

 

7.1.7     Subject to other provisions of the Contract Documents, the
amount of each progress payment shall be computed as follows:

 

.1               Take that portion of the Guaranteed
Maximum Price properly allocable to completed Work as determined by multiplying
the percentage completion of each portion of the Work by the share of the
Guaranteed Maximum Price allocated to that portion of the Work in the schedule
of values.  Pending final determination
of cost to the Owner of changes in the Work,

 

14

 

amounts not in
dispute may be included as provided in Subparagraph 7.3.7 of AIA Document A201,
attached as Attachment I, even though the Guaranteed Maximum Price has not
yet been adjusted by Change Order.

 

.2               Add that portion of the Guaranteed
Maximum Price properly allocable to materials and equipment delivered and
suitably stored at the site for subsequent incorporation in the Work or, if
approved in advance by the Owner, suitably stored off the site at a location
agreed upon in writing.

 

.3               Add the Construction Manager’s Fee, less
retainage of zero percent (0%). 
The Construction Manager’s Fee shall be computed upon the Cost of the
Work described in the two preceding Clauses at the rate stated in Subparagraph
5.1.1. or, if the Construction Manager’s Fee is stated as a fixed sum in
that Subparagraph, shall be an amount which bears the same ratio to that fixed
sum Fee as the Cost of the Work in the two preceding Clauses bears to a
reasonable estimate of the probable Cost of the Work upon its completion.

 

.4               Subtract the aggregate of previous
payments made by the Owner.

 

.5               Subtract the shortfall, if any,
indicated by the Construction Manager in the documentation required by
Subparagraph 7.1.4 to substantiate prior Applications for Payment, or resulting
from errors subsequently discovered by the Owner’s accountants in such
documentation.

 

.6               Subtract amounts, if any, for which the
Architect has withheld or nullified a Certificate for Payment as provided in
Paragraph 9.5 of AIA Document A201 attached as Attachment I.

 

7.1.8     Except with the Owner’s prior approval, payments to
Subcontractors shall be subject to retention of not less than ten
percent (10%) until Substantial Completion of each Subcontractor’s
respective portion of the Work.  At the
time of Substantial Completion of a Subcontractor’s respective portion of the
Work, the retainage may be reduced to five percent (5%), with such retainage
being paid when such Subcontractor’s portion of the Work is fully completed.  The Owner and the Construction Manager shall
agree upon a mutually acceptable procedure for review and approval of payments
and retention for subcontracts.

 

7.1.9     Except with the Owner’s prior approval, the Construction
Manager shall not  Except with the Owner’s prior approval the
Construction Manager shall not make advance payments to suppliers for
materials or equipment which have not been delivered and stored at the site.

 

7.1.10   In taking action on the Construction Manager’s Applications for
Payment, the Architect shall be entitled to rely on the accuracy and
completeness of the information furnished by the Construction Manager and shall
not be deemed to represent that the Architect has made a detailed examination,
audit or arithmetic verification of the documentation submitted in accordance
with Subparagraph 7.1.4 or other supporting data; that the Architect has made
exhaustive or continuous on-site inspections or that the Architect has made
examinations to ascertain how or for what purposes the Construction Manager has
used amounts previously paid on account of the Contract.  Such examinations, audits and verifications,
if required by the Owner, will be performed by the Owner’ accountants acting in
the sole interest of the Owner.

 

7.2        FINAL
PAYMENT

 

7.2.1     Final payment shall be made by the Owner to the Construction
Manager when: (1) the Contract has been fully performed by the Construction
Manager; except for the Construction Manager’s responsibility to correct
nonconforming Work, as provided in Subparagraph 12.2.2 of AIA Document A201,
and to satisfy other requirements, if any, which necessarily survive final
payment; (2) a final Application for Payment and a final accounting for the
Cost of the Work have been submitted by the Construction Manager and reviewed
by the Owner’s accountants; and (3) a final Certificate for Payment has
then been issued by the Architect; (4) three sets of as-built drawings of
the Project have been completed and furnished to the Owner: (5) a final
non-contingent certificate of occupancy for the completion of the Project has
been issued by the municipalities having jurisdiction over the Project and
delivered to the Owner; (6) all operation and maintenance manuals and
warranties for any materials and improvements incorporated into the Project
have been delivered to the Owner; and (7) final lien waivers and affidavits of
payment have been delivered by all Subcontractors and by the Construction
Manager to the Owner, in form reasonably acceptable to Owner.  Such  such final payment shall be
made by the Owner not more than 30 days after the receipt by Owner of the
last of through 7 above.  issuance of the Architect’s final Certificate
for Payment or as follows:

 

15

 

7.2.2     The amount of the final payment shall be calculated as follows:

 

.1               Take the sum of the Cost of the Work
substantiated by the Construction Manager’s final accounting and the
Construction Manager’s Fee; but not more than the Guaranteed Maximum Price.

 

.2               Subtract amounts, if any, for which the
Architect withholds, in whole or in part, a final Certificate for Payment as
provided in Subparagraph 9.5.1 of AIA Document A201 or other provisions of the
Contract Documents.

 

.3               Subtract the aggregate of previous
payments made by the Owner.

 

If the aggregate of previous
payments made by the Owner exceeds the amount due the Construction Manager, the
Construction Manager shall reimburse the difference to the Owner within
thirty (30) days.

 

7.2.3     The Owner’s accountants will review and report in writing on the
Construction Manager’s final accounting within 30 days after delivery of the
final accounting to the Architect by the Construction Manager.  Based upon such Cost of the Work as the
Owner’s accountants report to be substantiated by the Construction Manager’s
final accounting, and provided the other conditions of Subparagraph 7.2.1 have
been met, the Architect will, within seven days after receipt of the written
report of the Owner’s accountants, either issue to the Owner a final
Certificate for Payment with a copy to the Construction Manager, or notify the
Construction Manager and Owner in writing of the Architect’s reasons for
withholding a certificate as provided in Subparagraph 9.5.1 of AIA Document
A201, attached as Attachment I. 
The time periods stated in this Paragraph 7.2 supersede those stated in
Subparagraph 9.4.1 of AIA Document A201, attached as Attachment I.

 

7.2.4     If the Owner’s accountants report the Cost of the Work as
substantiated by the Construction Manager’s final accounting to be less than
claimed by the Construction Manager, the Construction Manager shall be entitled
to proceed in accordance with Article 9 without a further decision of the
Architect.  Unless agreed to otherwise,
a demand for mediation or arbitration of the disputed amount shall be made by
the Construction Manager within 60 days after the Construction Manager’s
receipt of a copy of the Architect’s final Certificate for Payment.  Failure to make such demand within this
60-day period shall result in the substantiated amount reported by the Owner’s
accountants becoming binding on the Construction Manager.  Pending a final resolution of the disputed
amount, the Owner shall pay the Construction Manager the amount certified in
the Architect’s final Certificate for Payment.

 

7.2.5     If, subsequent to final payment and at the Owner’s request, the
Construction Manager incurs costs described in Paragraph 6.1 and not excluded
by Paragraph 6.2 (1) to correct nonconforming Work, or (2) arising from the
resolution of disputes, the Owner shall reimburse the Construction Manager such
costs and the Construction Manager’s Fee, if any, related thereto on the same
basis as if such costs had been incurred prior to final payment, but not in
excess of the Guaranteed Maximum Price. 
If the Construction Manager has participated in savings, the amount of
such savings shall be recalculated and appropriate credit given to the Owner in
determining the net amount to be paid by the Owner to the Construction Manager.

 

ARTICLE 8

INSURANCE AND BONDS

 

8.1        INSURANCE REQUIRED OF THE CONSTRUCTION
MANAGER

 

During both phases of the
Project, the Construction Manager shall purchase and maintain insurance as set
forth in Paragraph 11.1  Article 11 of AIA Documents A201 naming
the Owner, Architect and Arcitects as an additional insured with respect to all
liability exposures.  Such insurance
shall be written for not less than the following limits, or greater if required
by law:

 

8.1.1     Workers’ Compensation and Employers’ Liability meeting statutory
limits mandated by State and Federal laws. 
If (1) limits in excess of those required by statute are to be provided
or (2) the employer is not statutorily bound to obtain such insurance coverage
or (3) additional coverages are required, additional coverages and limits for
such insurance shall be as follows:

 

8.1.2     Commercial General Liability including coverage for
Premises-Operations, Independent Contractors’ Protective, Products-Completed
Operations, Contractual Liability, Personal Injury, and Broad Form Property
Damage (including coverage for Explosion, Collapse and Underground hazards)

 

 

16

 

 

	
  $

  	
  2,000,000

  	
   

  	
  Each Occurrence

  	
   

  	 

	
  $

  	
  6,000,000

  	
   

  	
  General Aggregate

  	
   

  	 

	 
	
  $

  	
  2,000,000

  	
   

  	
  Personal and

  Advertising Injury

  	
   

  
	 
	
  $

  	
  2,000,000

  	
   

  	
  Products-Completed

  Operations Aggregate

  	
   

  
											

 

.1   The policy shall be an
occurrence based form and be endorsed to have the General Aggregate apply
to this Project only.

 

.2   Products and Completed
Operations insurance shall be maintained for a minimum period of at least one(1)
year(s) after either 90 days following Substantial Completion or final
payment, whichever is earlier.

 

.3   The Contractual Liability
insurance shall include coverage sufficient to meet the obligations in AIA
Document A201 under Paragraph 3.18.

 

8.1.3     Automobile Liability (owned, non-owned and hired vehicles) for
bodily injury and property damage:

 

$ 2,000,000 Each Accident

 

8.1.4     Other coverage:

(If Umbrella Excess Liability coverage is required over the primary
insurance or retention, insert the coverage limits.  Commercial General Liability and Automobile Liability limits may
be attained by individual policies or by a combination of primary policies and
Umbrella and/or Excess Liability policies.)

 

Umbrella
coverage shall be equal to the GMP.

 

8.2        INSURANCE REQUIRED OF THE OWNER

During both phases of the
Project, the Owner shall purchase and maintain liability and property
insurance, including waivers of subrogation, as set forth in Paragraphs 11.2
and 11.3  Article 11 of AIA Document A201, attached as Attachment
I.  Such insurance shall be
written for not less than the following limits, or greater if required by law.

 

8.2.1     Property Insurance  See Section 11.8 of AIA Document
A201, attached hereto as Attachmnet I. :

 

Deductible Per Occurrence

Aggregate Deductible

8.2.2     Boiler and Machinery insurance with a limit of:

 

(If not a blanket policy, list the objects to be insured.)

 

8.3        PERFORMANCE BOND AND PAYMENT BOND

 

8.3.1     The Construction Manager shall be required to furnish a
$10,000,000,00 payment and performance bond in form and with such obligees as
is reasonably acceptable to Owner, and the construction Manager shall be
required to furnish from each of the Subcontractors, payment and performance
bonds for 100% of the cost of each such Subcontractor's Work in such form and
with such obligees (in addition to the Construction Manager and its bonding
compnay), as is reasonably acceptable to Owner.  Owner shall be given originals or duplicate originals of all
bonds obtained pursuant to this paragraph. 
(Insert "shall" or
"shall not")  furnish bonds covering faithful
performance of the Contract and payment of obligation arising thereunder.  Bonds may be obtained through the
Construction Manager's usual source and the cost thereof shall be included in
the Cost of the Work.  The amount of
all such  each bonds shall be equal to at least 100%
percent () of the Contract Sum.

 

8.3.2     The Construction Manager shall deliver the required bonds to the
Owner at least three days before the commencement of any Work at the Project
site.

 

ARTICLE 9

MISCELLANEOUS PROVISIONS

 

9.1        DISPUTE RESOLUTION FOR THE
PRECONSTRUCTION PHASE

 

9.1.1     Claims, disputes or other matters in question between the
parties to this Agreement which arise prior to the commencement of the
Construction Phase or which relate solely to the Preconstruction Phase services
of the Construction

 

17

 

Manager or to the Owner’s
obligations to the Construction Manager during the Preconstruction Phase, shall
be resolved by mediation or by arbitration.

 

9.1.2     Any mediation conducted pursuant to this Paragraph 9.1 shall be
held in accordance with the Construction Industry Mediation Rules of the
American Arbitration Association currently in effect, unless the parties
mutually agree otherwise.  Demand for
mediation shall be filed in writing with the other party to this Agreement and
with the American Arbitration Association. 
Any demand for mediation shall be made within a reasonable time after
the claim, dispute or other matter in question has arisen.  In no event shall the demand for mediation
be made after the date when institution of legal or equitable proceedings based
upon such claim, dispute or other matter in question would be barred by the
applicable statute of limitations.

 

9.1.3     Any claim, dispute or other matter in question not resolved by
mediation shall be decided by arbitration in accordance with the Construction
Industry Arbitration Rules of the American Arbitration Association currently in
effect unless the parties mutually agree otherwise.

 

9.1.4     Demand for arbitration shall be filed in writing with the other
party to this Agreement and with the American Arbitration Association.  A demand for arbitration may be made
concurrently with a demand for mediation and shall be made within a reasonable
time after the claim, dispute or other matter in question has arisen.  In no event shall the demand for arbitration
be made after the date when institution of legal or equitable proceedings based
upon such claim, dispute or other matter in question would be barred by the
applicable statute of limitations.

 

9.1.5     No arbitration arising out of or relating to the Contract
Documents shall include, by consolidation or joinder or in any other manner,
the Architect, the Architect’s employees or consultants, except by written
consent containing specific reference to the Agreement and signed by the
Architect, Owner, Construction Manager and any other person or entity sought to
be joined.  No arbitration shall
include, by consolidation or joinder or in any other manner, parties other than
the Owner, Construction Manager, a separate contractor as described in Article
6 of AIA Document A201, attached as Attachment I, and other persons
substantially involved in a common question of fact or law whose presence is
required if complete relief is to be accorded in arbitration.  No person or entity other than the Owner or
Construction Manager or a separate contractor as described in Article 6 of AIA
Document A201, attached as Attachment I, shall be included as an
original third party or additional third party to an arbitration whose interest
or responsibility is insubstantial. 
Consent to arbitration involving an additional person or entity shall
not constitute agreement to arbitration of a dispute not described in such
consent or with a person or entity not named or described therein.  The foregoing agreement to arbitrate and
other agreements to arbitrate with an additional person or entity duly
consented to by parties to this Agreement shall be specifically enforceable
under applicable law in any court having jurisdiction thereof.

 

9.1.6     The award rendered by the arbitrator or arbitrators shall be
final, and judgment may be entered upon it in accordance with applicable law in
any court having jurisdiction thereof.

 

9.2        DISPUTE RESOLUTION FOR THE
CONSTRUCTION PHASE

 

9.2.1     Any other claim, dispute or other matter in question arising out
of or related to this Agreement or breach thereof shall be settled in
accordance with Article 4 of AIA Document A201, attached as Attachment I,
except that in addition to and prior to arbitration, the parties shall endeavor
to settle disputes by mediation in accordance with the Construction Industry
Mediation Rules of the American Arbitration Association currently in effect
unless the parties mutually agree otherwise. 
Any mediation arising under this Paragraph shall be conducted in
accordance with the provisions of Subparagraphs 9.1.2 and 9.1.3.

 

9.3        OTHER PROVISIONS

 

9.3.1     Unless otherwise noted, the terms used in this Agreement shall
have the same meaning as those in the 1987 Edition of AIA Document A201,
General Conditions of the Contract for Construction, attached hereto as
Attachmnet I.

 

9.3.2     EXTENT OF CONTRACT

 

This Contract, which includes
this Agreement and the other documents incorporated herein by reference,
represents the entire and integrated agreement between the Owner and
Construction Manager and supersedes all prior negotiations, representations or
agreements, either written or oral. 
This Agreement may be amended only by written instrument signed by both
the Owner and Construction Manager.  If
anything in any document incorporated into this Agreement is inconsistent with
this Agreement, this Agreement shall govern.

 

9.3.3     OWNERSHIP AND USE OF DOCUMENTS

 

The Drawings, Specifications
and other documents prepared by the Architect, and copies thereof furnished to
the Construction Manager, are owned by the Owner and are for use solely
with respect to this Project.  They are
not to be used by the Construction Manager, Subcontractors, Sub-subcontractors
or suppliers on other projects, or for additions to this Project outside the
scope of the Work, without the specific written consent of the Owner and Architect.  The Construction Manager, Subcontractors,
Sub-subcontractors and suppliers are granted a limited license to use and
reproduce applicable portions of the Drawings, Specifications and other
documents prepared by the Architect appropriate to and for use in the execution
of their Work under the Contract Documents.

 

18

 

9.3.4     GOVERNING LAW

 

The Contract shall be governed
by the law of the place where the Project is located.

 

9.3.5     ASSIGNMENT

 

The Owner and Construction
Manager respectively bind themselves, their partners, successors, assigns and
legal representatives to the other party hereto and to partners, successors,
assigns and legal representatives of such other party in respect to covenants,
agreements and obligations contained in the Contract Documents.  Neither party to the Contract shall assign
the Contract as a whole without written consent of the other.  If either party attempts to make such an
assignment without such consent, that party shall nevertheless remain legally
responsible for all obligations under the Contract and in such event the
other party shall have the right to terminate this Contract exercisable in its
sole discretion upon seven (7) days advance written notice.

 

ARTICLE 10

TERMINATION OR SUSPENSION

 

10.1      TERMINATION PRIOR TO ESTABLISHING
GUARANTEED MAXIMUM PRICE

 

10.1.1   Prior to execution by both parties of Amendment No. 1 establishing
the Guaranteed Maximum Price, the Owner may terminate this Contract at any time
without cause, and the Construction Manager may terminate this Contract for any
of the reasons described in Subparagraph 14.1.1 of AIA Document A201,
attached as Attachment I.

 

10.1.2   If the Owner or Construction Manager terminates this Contract
pursuant to this Paragraph 10.1 prior to commencement of the Construction
Phase, the Construction Manager shall be equitably compensated for
Preconstruction Phase services performed prior to receipt of notice of
termination; provided, however, that the compensation for such services shall
not exceed the compensation set forth in Subparagraph 4.1.1.

 

10.1.3   If the Owner or Construction Manager terminates this Contract
pursuant to this Paragraph 10.1 after commencement of the Construction Phase,
the Construction Manager shall, in addition to the compensation provided in
Subparagraph 10.1.2, be paid an amount calculated as follows:

 

.1          Take
the Cost of the Work incurred by the Construction Manager.

 

.2          Add
the Construction Manager’s Fee computed upon the Cost of the Work to the date
of termination at the rate stated in Paragraph 5.1 or, if the Construction
Manager’s Fee is stated as a fixed sum in that Paragraph, an amount which bears
the same ratio to that fixed-sum Fee as the Cost of Work at the time of
termination bears to a reasonable estimate of the probable Cost of the Work
upon its completion.

 

.3          Subtract
the aggregate of previous payments made by the Owner on account of the
Construction Phase.

 

The Owner shall also pay the
Construction Manager fair compensation, either by purchase or rental at the
election of the Owner, for any equipment owned by the Construction Manager
which the Owner elects to retain and which is not otherwise included in the
Cost of the Work under Clause 10.1.3.1. 
To the extent that the Owner elects to take legal assignment of
subcontracts and purchase orders (including rental agreements), the
Construction Manager shall, as a condition of receiving the payments referred
to in this Article 10, execute and deliver all such papers and take all such
steps, including the legal assignment of such subcontracts and other
contractual rights of the Construction Manager, as the Owner may require for
the purpose of fully vesting in the Owner the rights and benefits of the
Construction Manager under such subcontracts or purchase orders.

 

Subcontracts, purchase orders
and rental agreements entered into by the Construction Manager with the Owner’s
written approval prior to the execution of Amendment No. 1 shall contain
provisions permitting assignment to the Owner as described above.  If the Owner accepts such assignment, the
Owner shall reimburse or indemnify the Construction Manager with respect to all
costs arising under the subcontract, purchase order or rental agreement except
those which would not have been reimbursable as Cost of the Work if the
contract had not been terminated.  If
the Owner elects not to accept the assignment of any subcontract, purchase
order or rental agreement which would have constituted a Cost of the Work had
this agreement not been terminated, the Construction Manager shall terminate
such subcontract, purchase order or rental agreement and the Owner shall pay
the Construction Manager the costs necessarily incurred by the Construction
Manager by reason of such termination.

 

10.1.4   Termination of Preconstruction Phase
Services.  The Preconstruction Services
may be terminated prior to commencement of the construction work by the Owner
upon fifteen (15) days written notice to the Construction  Manager, whereupon, the Construction Manager
shall be paid for all services satisfactorily performed and all other costs and
expenses incurred as contemplated by this Agreement up to and through the
effective date of termination.  In such
event, the Construction Manager shall provide assistance and cooperation in returning,
reselling, or otherwise disposing of any materials or services which were
reasonably necessary to be ordered, but not ultimately used for the Project.

 

19

 

10.2      TERMINATION SUBSEQUENT TO ESTABLISHING
GUARANTEED MAXIMUM PRICE

 

Subsequent to execution by both
parties of Amendment No. 1, the Contract may be terminated as provided in
Article 14 of AIA Document A201, attached as Attachment I.

 

10.2.1   In the event of such termination by the Owner, the amount payable
to the Construction Manager pursuant to Subparagraph 14.1.2 of AIA Document
A201, attached as Attachment I, shall not exceed the amount the
Construction Manager would have been entitled to receive pursuant to
Subparagraphs 10.1.2 and 10.1.3 of this Agreement. In addition, the Owner
may terminate this contract without cause following seven (7) days advance
written notice to the Construction Manager. 
In the event of such a termination without cause, the Owner shall reimburse
the Construction Manager for costs incurred for work then completed (provided
that the Owner receives all approprate lien waivers) and shall pay the
Construction Manager that portion of its fee earned through the date of
termination, based on the percentage of the work then completed, less fees
previously advanced by the Owner.

 

10.2.2   In the event of such termination by the Construction Manager, the
amount to be paid to the Construction Manager under Subparagraph 14.1.2 of AIA
Document A201, attached as Attachment I, shall not exceed the amount the
Construction Manager would be entitled to receive under Subparagraphs 10.1.2 or
10.1.3 above, except that the Construction Manager’s Fee shall be calculated as
if the Work had been fully completed by the Construction Manager including a
reasonable estimate of the Cost of the Work for Work not actually completed
follows:  If construction has reached
a level of less than fifty percent (50%) completion as of the effective date of
termination, the Construction Manager shall be entitled to the fee payable as
if fifty percent (50%) of the work had been completed.  If construction has reached a level of fifty
percent (50%) or greater as of the effective date of termination, the
Construction Manager shall be entitled to a fee based on the percentage of the
Work in fact completed.  For purposes of
the Contract commencement of construction occurs upon mutual execution of a
written notce to proceed.

 

10.3      SUSPENSION

The Work may be suspended by
the Owner as provided in Article 14 of AIA Document A201, attached as
Attachment I; in such case, the Guaranteed Maximum Price, if established,
shall be increased as provided in Subparagraph 14.3.2 of AIA Document A201, attached
as Attachment I, except that the term “cost of performance of the Contract”
in that Subparagraph shall be understood to mean the Cost of the Work and the
term “profit” shall be understood to mean the Construction Manager’s Fee as
described in Subparagraphs 5.1.1 and 5.3.4 of this Agreement.

 

ARTICLE 11

OTHER CONDITIONS AND SERVICES

 

11.1      Not withstanding anything herein to the
contrary, all references herein to AIA Document A201 shall mean AIA Document
A201-1997 Edition - Electronic Format and all supplemental provisions thereto
in the form annexed hereto as Attachment I.

 

11.2      The hourly rates of the Construction
Manager’s supervisory and administrative personnel will be as set forth in the
GMP Presentation, as approved by the Owner.

 

11.3      The following special provisions shall
apply to any furnishings, fixtures and equipment (“FF&E”) at the existing
facility that must be removed and/or reinstalled and/or any new FF&E
installed at the completed facility:

 

11.3.1   The Construction Manager shall coordinate the
Work to receive the FF&E based on specifications and information provided
by the Owner.  To the extent requested
by the Owner, the Construction Manager shall work with the Owner to establish
an acceptable list of potential installers of the FF&E and will solicit
bids from these installers.

 

11.3.2   Upon receipt of bids for the installation of
FF&E, the Construction Manager shall provide the Owner with an analysis of
these bids, and the Owner and the Construction Manager shall mutually determine
which of these bids to accept or reject.

 

11.3.3   The Construction Manager shall arrange for scheduling,
delivery and installation of the FF&E purchased by the Owner, and shall
supervise the installation of the FF&E at the site.

 

20

 

11.3.4   Notwithstanding anything in this Agreement to
the contrary, the Construction Manager shall be paid five percent (5%) of the
cost of the installation contracted for by the Construction Manager pursuant to
this paragraph 11.3. with payment due on installation and final acceptance of
such FF&E by the Owner.

 

11.4      In an effort to obtain the best estimate
of construction costs, the Construction Manager shall obtain at least three (3)
price quotations for each major portion of the Work for the Project from each
major trade, provided there is sufficient design and construction information
available, and provided that the Owner does not direct otherwise. All bids and
all documentation relied upon by the bidders to issue their bids shall be
presented to the Owner, for the Owner to choose the subcontractor for that
portion of the work for the Project.

 

11.5      To the extent permitted by the West
Virginia law, Contractors shall include pay-when-paid language in their
subcontracts establishing that subcontractors shall not be entitled to payment
until payment has been received by the Contractors from the Owner.

 

11.6      Contractors shall provide conditional
subcontractor lien waivers as part of their monthly periodic payment
application.

 

11.7      The GMP estimate established between the
Owner and Construction Manager will be a part of the GMP Presentation, and
shall be established as expeditiously as is practicable after the commencement
of construction.

 

11.8      Construction Manager or the Contractors
will carry Builder’s Risk insurance, which shall be replacement value policies
and which will name the Owner as an additional insured. The policies shall be
in an amount at least equal to the value of the completed Project and shall
apply on a replacement cost basis. This insurance shall cover the entirety of
the Work at the Project site, portions of the Work located away from the site
but intended for incorporation into the Work at the site and also portions of
the Work in transit. The Construction Manager shall be responsible for all
deductions. The cost of the Insurance shall be a Cost of the Work.

 

11.9      Construction Manager shall require that
all Subcontractors provide performance and payment bonds, as provided in
paragraph 8.3.1 hereof.

 

11.10    Notwithstanding anything else herein to the
contrary, the Owner and the Constructor recognize and acknowledge that the
original GMP is based on the GMP Presentation, but that the Project Manual,
Drawings and Specifications are not final. Upon receipt of the final Project
Manual, Drawings and Specifications from the Owner, the Constructor will
re-price the GMP. To the extent that the revised GMP exceeds the original GMP,
and the variance is due to additional work and/or materials which are
reasonably inferrable from the GMP Presentation and the Project Manual,
Drawings and Specifications as of the date of execution by all parties (the
“Initial Project Manual, Drawings and Specifications”). Owner will have no
obligation to increase the original GMP; however, the Owner will engage in good
faith discussions with the Constructor to redesign the Project through Value
Engineering so as to reduce the revised GMP to the original GMP, but in no
event will the Owner be required to agree to any redesign which would, in the
Owner’s sole discretion , compromise the integrity or quality of the Project.
To the extent that the revised GMP exceeds the original GMP, and the variance
is due to additional work and/or materials which are NOT reasonably inferrable
from the GMP Presentation, and the Initial Project, Manual Drawings and
Specifications, the Owner will elect to either issue a Change Order increasing
the original GMP to the amount of the revised GMP, or will engage in good faith
discussions with the Constructor to redesign the Project through Value
Engineering so as to reduce the revised GMP to the original GMP.

 

11.11    The GMP, as finally established, shall be
increased or decreased, as the case may be, if there is a change in the scope
of the Work as hereinbefore provided, resulting in additional Costs or reduced
Costs from those Costs set forth in the GMP Presentation (which “Costs” for
purposes of this Section 11.11, shall include the Construction Manager’s Fee
and the Cost of the Work), actually to be incurred by the Constructor as the
result of:

 

a.             Damage caused by
fire or other casualties, not caused by the Constructor or anyone for whom the
Constructor is responsible or liable, such as and including, without
limitation, all Subcontractors:

 

b.            Material default of
the Owner or Architect after written notice to each such party and the
expiration of ten (10) business days during which such default remains uncured
(or in the event such default will take longer than 10-day period, then for
such reasonable period of time necessary to effect such cure with due
diligence):

 

21

 

c.             Uncovering Work at
the direction of the Owner or the Architect if such Work upon the uncovering
thereof is found by the Owner and the Architect to be in conformity with the
Contract Documents:

 

d.            Requirements of the
Owner to use Subcontractors other than those first recommended by the
Constructor:

 

e.             The amount by which
the actual Cost of the Work for each element of the Work listed as allowances
in the GMP Presentation exceeds (or is less than) the amount of the allowance
listed thereon with respect to such element, except to the extent that the
increase in the Cost of the Work for such allowance item relating to temporary
heat or temporary power is the result of a delay caused by the Constructor: or

 

f. A material change, addition to
or deletion of the Work, but excluding such items as cutting, patching,
repairing or inclusion of items implied but not shown in the Project Manual,
Drawings and Specifications.  Such
change shall not be deemed to be “material” unless.  (i)  such change in the
Work involves a change in the quantity of the Work required to be performed
hereunder; (ii) such change in the Work involves a significant or substantial
change in the quality of the Work required to be performed hereunder, in the
opinion of a person experienced in construction industry practices and mutually
agreeable to the Owner and the Constructor (“Construction Expert”); and (iii)
such Construction Expert would reasonably determine that such change in either
quantity or quality was not reasonably implied or inferred from the
Construction Documents, whether or not actually shown therein.  The Constructor specifically acknowledges
and agrees that any change in the Contract Documents based on the finalization
of the Initial Project Manual, Drawings and Specifications, which change is
reasonably inferrable from the Initial Project Manual, Drawings and
Specifications, shall not cause an increase in the GMP.  The Constructor is hereby acknowledging that
the Contract Documents, including the Initial Project Manual, Plans and
Specifications, were sufficiently complete to enable Constructor to provide to
Owner, Constructor’s Guaranteed Maximum Price, to which the Constructor agrees
to be bound, notwithstanding any changes to the Work as the result of the
completion of the Initial Project Manual, Plans and Specifications by the
Architect thereafter, except for material changes in the Work, as set forth
above, or as approved by the Owner.

 

11.12    Notwithstanding anything in the General
conditions, attached hereto as Attachment I, to the contrary.  If Architect is late in providing the
Construction Manager design documnets for a bid package that causes a delay to
the overall Project schedule, Construction Manager reserves its rights to associated
additional costs and/or schedule relief.

 

11.13    Attached hereto and made a part hereof as
Attachment IV is the project labor agreement between Owner and the Upper Valley
Building and Construction Trades Council (the “Project Labor Agreement”), which
by its terms expires on December 31, 2002. 
Construction Manager agrees to abide by its terms, and both Owner and
Construction Manager agree to use their best efforts to extend such agreement
for the duration of the Project: provided, however, should there be any strike,
delay or dispute caused by expiration of the Project Labor Agreement, after
Construction Manager’s failed good faith efforts to extend it.  Construction Manager shall not be liable for
consequential damages, delay damages, or special damages to Owner as a result
thereof.

 

11.14    Attached hereto and made a part hereof as
Attachment V is the legal description that Owner warrants and represents is
that of the Site.

 

11.15    Attached hereto and made a part hereof a
Attachment VI is a narrative provided by Owner to Construction Manager from a
prospectus for a public offering by Owner, which Owner warrants and represents
is the financing Owner has for the Project.

 

This Agreement entered into as
of the day and year first written above.

 

	
  OWNER

  	
  CONSTRUCTION
  MANAGER

  
	
   

  	
   

  
	
  BY:

  	
   WHEELING ISLAND GAMING, INC.

  	
   

  	
  BY:

  	
  LOUIS P.
  CIMINELLI CONSTRUCTION COMPANY, INC,

  
	
   

  	
  /s/ Michael
  Corbin

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  DATE

  	
  7/17/02

  	
   

  	
  DATE

  	
  7/17/02

  
	
   

  	
   

  
	
  ATTEST

  	
   

  	
   

  	
  ATTEST

  	
  /s/
  [ILLEGIBLE]

  
											

 

22

 

ATTACHMENT 
I                                                   1997
Edition - Electronic Format

 

AIA Document A201 - 1997

 

General Conditions of the Contract for Construction

 

TABLE OF ARTICLES

 

1.      GENERAL PROVISIONS

 

2.      OWNER

 

3.      CONTRACTOR

 

4.      ADMINISTRATION OF THE CONTRACT

 

5.      SUBCONTRACTORS

 

6.      CONSTRUCTION BY OWNER OR BY SEPARATE
CONTRACTORS

 

7.      CHANGES IN THE WORK

 

8.      TIME

 

9.      PAYMENTS AND COMPLETION

 

10.    PROTECTION OF PERSONS AND PROPERTY

 

11.    INSURANCE AND BONDS

 

12.    UNCOVERING AND CORRECTION OF WORK

 

13.    MISCELLANEOUS PROVISIONS

 

14.    TERMINATION OR SUSPENSION OF THE CONTRACT

 

INDEX

Acceptance of Nonconforming
Work

9.6.6, 9.9.3,
12.3

Acceptance of Work

9.6.6, 9.8.2,
9.9.3, 9.10.1, 9.10.3, 12.3

Access to Work

3.16, 6.2.1,
12.1

Accident Prevention

4.2.3, 10

Acts and Omissions

3.2, 3.3.2,
3.12.8, 3.18, 4.2.3, 4.3.8, 4.4.1, 8.3.1, 9.5.1, 10.2.5, 13.4.2, 13.7, 14.1

Addenda

1.1.1, 3.11

Additional Costs, Claims for

4.3.4, 4.3.5,
4.3.6, 6.11, 10.3

 

Additional Inspections and
Testing

9.8.3, 12.2.1,
13.5

Additional Time, Claims for

4.3.4, 4.3.7,
8.3.2

ADMINISTRATION OF THE CONTRACT

3.1.3, 4.9.4,
9.5

 

THIS DOCUMENT HAS IMPORTANT
LEGAL CONSEQUENCES. CONSULTATION WITH AN ATTORNEY IS ENCOURAGED WITH RESPECT TO
ITS COMPLETION OR MODIFICATION. AUTHENTICATION OF THIS ELECTRONICALLY DRAFTED
AIA DOCUMENT MAY BE MADE BY USING AIA DOCUMENT D401.

 

This document has been approved
and endorsed by The Associated General Contractors of America.

 

[LOGO]

 

© 1997 AIA®

AIA DOCUMENT A201 - 1997
GENERAL CONDITIONS OF THE CONTRACT FOR CONSTRUCTION

 

The American Institute of
Architects 1735 New York Avenue, N.W. Washington, D.C. 20006-5292

 

 

ATTACHMENT I

 

Advertisement or Invitation to
Bid

1.1.1

Aesthetic Effect

4.2.13, 4.5.1

Allowances

3.8

All-risk Insurance

11.4.1.1

Application for Payment

4.2.5, 7.3.8,
9.2, 9.3, 9.4, 9.5.1, 9.36.3, 9.7.1, 9.8.5, 9.10, 11.1.3, 14.2.4, 14.4.3

Approvals

2.4, 3.1.3,
3.5, 3.10.2, 3.12, 4.2.7, 9.3.2, 13.4.2, 13.5

Arbitration

4.3.3, 4.4,
4.5.1, 4.5.2, 4.6, 8.3.1, 9.7.1, 11.4.9, 11.4.10

Architect

4.1

Architect, Definition of

4.1.1

Architect, Extent of Authority

2.4, 3.12.7,
4.2, 4.336, 4.4, 5.2, 6.3, 7.1.2, 7.3.6, 7.4, 9.2, 9.3.1, 9.4, 9.5, 9.8,
9.10.1, 9.10.3, 12.1, 12.2.1, 13.5.1, 13.5.2, 14.2.2, 14.2.4

Architect, Limitations of
Authority and Responsibility

2.1.1, 3.3.3,
3.12.4, 3.12.8, 3.12.10, 4.1.2, 4.2.1, 4.2.2, 4.2.3, 4.2.6, 4.2.7, 4.2.10, 4.2.12,
4.2.13, 4.4, 5.2.1, 7.4, 9.4.2, 9.6.4, 9.6.6

Architect’s Additional Services
and Expenses

2.4, 11.4.1.1,
12.2.1, 13.5.2, 13.5.3,  14.2.4

Architect’s Administration of
the Contract

3.1.3, 4.2,
4.3.4, 4.4, 9.4, 9.5

Architect’s Approvals

2.4, 3.1.3,
3.5.1, 3.10.2, 4.2.7

Architect’s Authority to Reject
Work

3.5.1, 4.2.6,
12.1.2, 12.2.1

Architect’s Copyright

1.6

Architect’s Decisions

4.2.6, 4.2.7,
4.2.11, 4.2.12, 4.2.13, 4.3.4, 4.4.1, 4.4.5, 4.4.6, 4.5, 6.3, 7.3.6, 7.3.8,
8.1.3, 8.3.1,9.2, 9.4, 9.5.1, 9.8.4, 9.9.1, 13.5.2, 14.2.2, 14.2.4

Architect’s Inspection

4.2.2, 4.2.9,
4.3.4, 9.4.2, 9.8.3, 9.9.2, 9.10.1, 13.5

Architect’s Instructions

3.2.3, 3.3.1,
4.2.6, 4.2.7, 4.2.8, 7.4.1, 12.1, 13.5.2

Architect’s Interpretations

4.2.11,
4.2.12, 4.3.6

Architect’s Project
Representative

4.2.10

Architect’s Relationship with
Contractor

1.1.2, 1.6,
3.1.3, 3.2.1, 3.2.2, 3.2.3, 3.3.1, 3.4.2, 3.5.1, 3.7.3, 3.10, 3.11, 3.12, 3.16,
3.18, 4.1.2, 4.1.3, 4.2, 4.3.4, 4.4.1, 4.4.7, 5.2 6.2.2, 7.8.3.1, 9.2, 9.3,
9.4, 9.5, 9.7, 9.8, 9.9, 10.2.6, 10.3, 11.3, 11.4.7, 12, 13.4.2, 13.5

Architect’s Relationship with
Subcontractors

1.1.2, 4.2.3,
4.2.4, 4.2.6, 9.6.3, 9.6.4, 11.4.7

Architect’s Representations

9.4.2, 9.5.1,
9.10.1

Architect’s Site Visits

4.2.2, 4.2.5,
4.2.9, 4.3.4, 9.4.2, 9.5.1, 9.9.2, 9.10.1, 13.5

Asbestos

10.3.1

Attorneys’ Fees

3.18.1,
9.10.2, 10.3.3

Award of Separate Contract

6.1.1, 6.1.2

Award of Subcontracts and Other
Contracts for Portions of the Work

5.2

Basic Definitions

1.1

Bidding Requirements

1.1.1, 1.1.7,
5.2.1, 11.5.1

Boiler and Machinery Insurance

11.4.2

Bonds, Lien

9.10.2

Bonds, Performance, and Payment

7.3.6.4,
9.6.7, 9.10.3, 11.4.9, 11.5

Building Permit

3.7.1

Capitalization

1.3

Certificate of Substantial
Completion

9.8.3, 9.8.4,
9.8.5

Certificates for Payment

4.2.5, 4.2.9,
9.3.3, 9.4, 9.5, 9.6.1, 9.6.6, 9.7.1, 9.10.1, 9.10.3, 13.7, 14.1.1.3, 14.2.4

Certificates of Inspection,
Testing or Approval

13.5.4

Certificates of Insurance
9.10.2, 11.1.3

Change Order

1.1.1, 2.4.1,
3.4.2, 3.8.2.3, 3.11.1, 3.12.8, 4.2.8, 4.3.4, 4.3.9, 5.2.3, 7.1, 7.2, 7.3,
8.3.1, 9.3.1.1, 9.10.3, 11.4.1.2, 11.4.4, 11.4.9, 12.1.2

Change Orders, Definitions of

7.2.1

CHANGES IN THE WORK

3.11, 4.2.8,
7, 8.3.1, 9.3.1.1, 11.4.9

Claim, Definition of

4.3.1

Claims and Disputes

3.2.3, 4.3,
4.4, 4.5, 4.6, 6.1.1, 6.3, 7.3.8, 9.3.3, 9.10.4, 10.3.3.

Claims and Timely Assertion of
Claims

4.6.5

 

2

 

Claims for Additional Cost

3.2.3, 4.3.4,
4.3.5, 4.3.6, 7.3.8, 10.3.2

Claims for Additional Cost

3.2.3, 4.3.4,
4.3.7, 6.1.1, 8.3.2, 10.3.2

Claims for Concealed or Unknown
Conditions

4.3.4

Claims for Damages

3.2.3, 3.18,
4.3.10, 6.1.1, 8.3.3, 9.5.1, 9.6.7, 10.3.3, 11.1.1, 11.4.5, 11.4.7, 14.1.3,
14.2.4

Claims Subject to Arbitration

4.4.1, 4.5.1,
4.6.1

Cleaning Up

3.15, 6.3

Commencement of Statutory
Limitation Period

13.7

Commencement of the Work,
Conditions Relating to

2.2.1, 3.2.1,
3.4.1, 3.7.1, 3.10.1, 3.12.6, 4.3.5, 5.2.1, 5.2.3, 6.2.2, 8.1.2, 8.2.2, 8.3.1,
11.1, 11.4.1, 11.4.6, 11.5.1

Commencement of the Work,
Definition of

8.1.2

Communications Facilitating
Contract Administration

3.9.1, 4.2.4

Completion, Conditions Relating
to

1.6.1, 3.4.1,
3.11, 3.15, 4.2.2, 4.2.9, 8.2, 9.4.2, 9.8, 9.9.1, 9.10, 12.2, 13.7, 14.1.2

COMPLETION, PAYMENTS AND

9

Completion, Substantial

4.2.9, 8.1.1,
8.1.3, 8.2.3, 9.4.2, 9.8, 9.9.1, 9.10.3, 9.10.4.2, 12.2, 13.7

Compliance with Laws

1.6.1, 3.2.2,
3.6, 3.7, 3.12.10, 3.13, 4.1.1, 4.4.8, 4.6.4, 4.6.6, 9.6.4, 10.2.2, 11.1, 11.4,
13.1, 13.4, 13.5.1, 13.5.2, 13.6, 14.1.1, 14.2.1.3

Concealed or Unknown Conditions

4.3.4, 8.3.1,
10.3

Conditions of the Contract

1.1.1, 1.1.7,
6.1.1, 6.1.4

Consent, Written

1.6, 3.4.2,
3.12.8, 3.14.2, 4.1.2, 4.3.4, 4.6.4, 9.3.2, 9.8.5, 9.9.1, 9.10.2, 9.10.3,
11.4.1, 13.2, 13.4.2

CONSTRUCTION BY OWNER OR BY
SEPARATE CONTRACTORS

1.1.4, 6

Construction Changed Directive,
Definition of

7.3.1

Construction Change Directives

1.1.1, 3.12.8,
4.2.8, 4.3.9, 7.1, 7.3, 9.3.1.1

Construction Schedules,
Contractor’s

1.4.1.2, 3.10,
3.12.1, 3.12.2, 4.3.7.2, 6.1.3

Contingent Assignment of Subcontracts

5.4, 14.2.2.2

Continuing Contract Performance

4.3.3

Contract, Definition of

1.1.2

CONTRACT, TERMINATION OR
SUSPENSION OF THE

5.4.1.1,
11.4.9, 14

Contract Administration

3.1.3, 4, 9.4,
9.5

Contract Award and Execution,
Conditions Relating to

3.7.1, 3.10,
5.2, 6.1, 11.1.3, 11.4.6, 11.5.1

Contract Documents, The

1.1, 1.2

Contract Documents, Copies
Furnished and Use of

1.6, 2.2.5,
5.3

Contract Documents, Definitions
of

1.1.1

Contract Sum

3.8, 4.3.4,
4.3.5, 4.4.5, 5.2.3, 7.2, 7.3, 7.4, 9.1, 9.4.2, 9.5.1.4, 9.6.7, 9.7, 10.3.2,
11.4.1, 14.2.4, 14.3.2

Contract Sum, Definition of

9.1

Contract Time

4.3.4, 4.3.7,
4.4.5, 5.2.3, 7.2.1.3, 7.3, 7.4, 8.1.1, 8.2, 8.3.1, 9.5.1, 9.7, 10.3.2, 12.1.1,
14.3.2

Contract Time, Definition of

8.1.1

CONTRACTOR

3

Contractor, Definition of

3.1, 6.1.2

Contractor’s Construction
Schedules

1.4.1.2, 3.10,
3.12.1, 3.12.2, 4.3.7.2, 6.1.3

Contractor’s Employees

3.3.2, 3.4.3,
3.8.1, 3.9, 3.18.2, 4.2.3, 4.2.6, 10.2, 10.3, 11.1.1, 11.4.7, 14.1, 14.2.1.1

Contractor’s Liability
Insurance

11.1

Contractor’s Relationship with
Separate

Contractors and Owner’s Forces

3.12.5,
3.14.2, 4.2.4, 6, 11.4.7, 12.1.2, 12.2.4

Contractor’s Relationship with
Subcontractors

1.2.2, 3.3.2,
3.18.1, 3.18.2, 5.9.6.2, 9.6.7, 9.10.2, 11.4.1.2, 11.4.7, 11.4.8

Contractor’s Relationship with
the Architect

1.1.2, 1.6,
3.1.3, 3.2.1, 3.2.2, 3.2.3, 3.3.1, 3.4.2, 3.5.1, 3.7.3, 3.10, 3.11, 3.12, 3.16,
3.18, 4.1.2, 4.1.3, 4.2, 4.3.4, 4.4.1, 4.4.7, 5.2, 6.2.2, 7, 8.3.1, 9.2, 9.3,
9.4, 9.5, 9.7, 9.8, 9.9, 10.2.6, 10.3, 11.3,

11.4.7, 12,
13.4.2, 13.5

 

3

 

Contractor’s Representations

1.5.2, 3.5.1,
3.12.6, 6.2.2, 8.2.1, 9.3.3, 9.8.2

Contractor’s Responsibility for
Those Performing the Work

3.3.2, 3.18,
4.2.3, 4.3.8, 5.3.1, 6.1.3, 6.2, 6.3, 9.5.1, 10

Contractor’s Review of Contract
Documents

1.5.2, 3.2,
3.7.3

Contractor’s Right to Stop the
Work

9.7

Contractor’s Right to Terminate
the Contract

4.3.10, 14.1

Contractor’s Submittals

3.10, 3.11,
3.12, 4.2.7, 5.2.1, 5.2.3, 7.3.6, 9.2, 9.3, 9.8.2, 9.8.3, 9.9.1, 9.10.2,
9.10.3, 11.1.3, 11.5.2

Contractor’s Superintendent

3.9, 10.2.6

Contractor’s Supervision and
Construction Procedures

1.2.2, 3.3,
3.4, 3.12.10, 4.2.2, 4.2.7, 4.3.3, 6.1.3, 6.2.4, 7.1.3, 7.3.4, 7.3, 6, 8.2, 10,
12, 14

Contractual Liability Insurance

11.1.1.8,
11.2, 11.3

Coordination and Correlation

1.2, 1.5.2,
3.3.1, 3.10, 3.12.6, 6.1.3, 6.2.1

Copies Furnished or Drawings
and Specifications

1.6, 2.2.5,
3.11

Copyrights

1.6, 3.17

Correction of Work

2.3, 2.4,
3.7.4, 4.2.1, 9.4.2, 9.8.2, 9.8.3, 9.9.1, 12.1.2, 12.2, 13.7.1.3

Correlation and Intent of the
Contract Documents

1.2

Cost, Definition of

7.3.6

Costs

2.4, 3.2.3,
3.7.4, 3.8.2, 3.15.2, 4.3, 5.4.2, 6.1.1, 6.2.3, 7.3.3.3, 7.3.6, 7.3.7, 7.3.8,
9.10.2, 10.3.2, 10.5, 11.3, 11.4, 12.1, 12.2.1, 12.2.4, 13.5, 14

Cutting and
Patching

6.2.5, 3.14

Damage to Construction of Owner
or Separate Contractors

3.14.2, 6.2.4,
9.2.1.5, 10.2.1.2, 10.2.5, 10.6, 11.1, 11.4, 12.2.4

Damage to the Work

3.14.2, 9.9.1,
10.2.1.2, 10.2.5, 10.6, 11.4, 12.2.4

Damages, Claims for

3.2.3, 3.18,
4.3.10, 6.1.1, 8.3.3, 9.5.1, 9.6.7, 10.3.3, 11.1.1, 11.4.5, 11.4.7, 14.1.3,
14.2.4

Damages for Delay

6.1.1, 8.3.3,
9.5.1.6, 9.7, 10.3.2

Date of Commencement of the
Work, Definition of

8.1.2

Date of Substantial Completion,
Definition of

8.1.3

Day, Definition of

8.1.4

Decisions of the Architect

4.2.6, 4.2.7,
4.2.11, 4.2.12, 4.2.13, 4.3.4, 4.4.1, 4.4.5, 4.4.6, 4.5, 6.3, 7.3.6, 7.3.8,
8.1.3, 8.3.1, 9.2, 9.4, 9.5.1, 9.8.4, 9.9.1, 13.5.2, 14.2.2, 14.2.4

Decisions to Withhold
Certification

9.4.1, 9.5,
9.7, 14.1.1.3

Defective or Nonconforming
Work, Acceptance, Rejection and Correction of

2.3, 2.4,
3.5.1, 4.2.6, 6.2.5, 9.5.1, 9.5.2, 9.6.6, 9.8.2, 9.9.3, 9.10.4, 12.2.1,
13.7.1.3

Defective Work, Definition of

3.5.1

Definitions

1.1, 2.1.1,
3.1, 3.5.1, 3.12.1, 3.12.2, 3.12.3, 4.1.1, 4.3.1, 5.1, 6.1.2, 7.2.1, 7.3.1,
7.3.6, 8.1, 9.1, 9.8.1

Delays and Extension of Time

3.2.3, 4.3.1,
4.3.4, 4.3.7, 4.4.5, 5.2.3, 7.2.1, 7.3.1, 7.4.1, 7.5.1, 8.3, 9.5.1, 9.7.1,
10.3.2, 10.6.1, 14.3.2

Disputes

4.1.4, 4.3, 4.4,
4.5, 4.6, 6.3, 7.3.8

Documents and Samples at the
Site

3.11

Drawings, Definition of

1.1.5

Drawings and Specifications,
Use and Ownership of

1.1.1, 1.3,
2.2.5, 3.11, 5.3

Effective Date of Insurance

8.2.2, 11.1.2

Emergencies

4.3.5, 10.6,
14.1.1.2

Employees, Contractor’s

3.3.2, 3.4.3,
3.8.1, 3.9, 3.18.2, 4.2.3, 4.2.6, 10.2, 10.3, 11.1.1, 11.4.7, 14.1, 14.2.1.1

Equipment, Labor, Materials and

1.1.3, 1.1.6,
3.4, 3.5.1, 3.8.2, 3.8.3, 3.12, 3.13, 3.15.1, 4.2.6, 4.2.7, 5.2.1, 6.2.1,
7.3.6, 9.3.2, 9.3.3, 9.5.1.3, 9.10.2, 10.2.1, 10.2.4, 14.2.1.2

Execution and Progress of the
Work

1.1.3, 1.2.1,
1.2.2, 2.2.3, 2.2.5, 3.1, 3.3, 3.4, 3.5, 3.7, 3.10, 3.12, 3.14, 4.2.2, 4.2.3,
4.3.3, 6.2.2, 7.1.3, 7.3.4, 8.2, 9.5, 9.9.1, 10.2, 10.3, 12.2, 14.2, 14.3

Extensions of Time

3.2.3, 4.3.1,
4.3.4, 4.3.7, 4.4.5, 5.2.3, 7.2.1, 7.3, 7.4.1, 9.5.1, 9.7.1, 10.3.2, 10.6.1,
14.3.2

Failure of Payment

4.3.6,
9.5.1.3, 9.7, 9.10.2, 14.1.1.3, 14.2.1.2, 13.6

Faulty Work

(See Defective
or Nonconforming Work)

 

4

 

Final Completion and Final
Payment

4.2.1, 4.2.9,
4.3.2, 9.8.2, 9.10, 11.1.2, 11.1.3, 11.4.1, 11.4.5, 12.3.1, 13.7, 14.2.4,
14.4.3

Financial Arrangements, Owner’s

2.2.1, 13.2.2,
14.1.1.5

Fire and Extended Coverage
Insurance 

11.4

GENERAL PROVISIONS

1

Governing Law

13.1

Guarantees (See Warranty)

Hazardous Materials

10.2.4,10.3,10.5

Identification of Contract
Documents

1.5.1

Identification of
Subcontractors and Suppliers 

5.2.1

Indemnification

3.17, 3.18,
9.10.2, 10.3.3, 10.5, 11.4.1.2, 11.4.7

Information and Services
Required of the Owner

2.12, 2.2,
3.2.1, 3.12.4, 3.12.10, 4.2.7, 4.3.3, 6.1.3, 6.14, 6.2.5, 9.3.2, 9.6.1, 9.6.4,
9.9.2, 9.1.0.3, 10.3.3, 11.2, 11.4, 13.5.1, 13.5.2, 14.1.1.4, 14.1.4

Injury or Damage to Person or
Property

4.3.8, 10.2,
10.6

Inspections

3.1.3, 3.3.3,
3.7.1, 4.2.2, 4.2.6, 4.2.9, 9.4.2, 9.8.2, 9.8.3, 9.9.2, 9.10.1, 12.2.1, 13.5

Instruction to Bidders

1.1.1

Instruction to the Contractor 

3.2.3, 3.3.1,
3.8.1, 4.2.8, 5.2.1, 7.12, 8.2.2, 13.5.2

Insurance

3.18.1, 6.1.1,
7.3.6, 8.2.1, 9.3.2, 9.8.4, 9.9.1,

9.10.2,
9.10.5, 11

Insurance, Boiler and Machinery

11.4.2

Insurance, Contractor’s
Liability

11.1

Insurance, Effective Date of 

8.2.2, 11.1.2

Insurance, Loss of Use

11.4.3

Insurance, Owner’s Liability

11.2

Insurance, Project Management
Protective

Liability

11.3

Insurance, Property

10.25, 11.4

Insurance, Stored Materials

9.3.2,
11.4.1.4

 

INSURANCE AND BONDS

11

Insurance Companies, Consent to
Partial 

Occupancy

9.9.1,
11.4.1.5

Insurance Companies, Settlement
with

11.4.10

Indent of the Contract
Documents

1.2.1,4.2.7,4.2.12,4.2.13,7.4

Interest

13.6

Interpretation

1.2.3, 1.4,
4.1.1, 4.3.1, 5.1, 6.1.2, 8.1.4

Interpretations, Written

4.2.11,
4.2.12, 4.3.6

Joinder and Consolidation of
Claims Required 

4.6.4

Judgment on Final Award

4.6.6

Labor and Materials, Equipment

1.1.3, 1.1.6,
3.4, 3.5.1, 3.8.2, 3.8.3, 3.12.3.13. 3.15.1, 42.6, 4.2.7, 5.2.1, 6.2.1, 7.3.6,
9.3.2, 9.3.3, 9.5.1.3, 9.10.2, 10.2.1, 10.2.4, 14.2.1.2

Labor Disputes

8.31

Laws  and Regulations

1.6, 3.2.2,
3.6, 3.7, 3.12.10, 3.13, 4.1.1, 4.4.8, 4.6, 
9.6.4, 9.9.1, 10.2.2, 11.1, 11.4, 13.1, 13.4, 13.5.1, 13.5.2, 13.6, 14

Liens

2.12, 4.4.8,
8.2.2, 9.3.3, 9.10

Limitation on Consolidation or
Joinder

4.6.4

Limitations, Statutes of

4.6.3,12.2.6,13.7

Limitations of Liability

2.3, 3.2.1,
3.5.1, 3.73, 3.12, 8, 3.12.10,  3.17,
3.18. 4.2.6.4.2.7, 4.2.12, 6.2.2, 9.4.2, 9.6.4, 9.6.7, 9.10.4, 10.3.3, 10.2.5,
11.1.2, 11.2.1, 11.4.7, 12.2.5, 13.4.2

Limitations of Time

2.1.2, 2.2,
2.4, 3.2.1, 3.7.3, 3.10, 3.11, 3.12.5, 3.15.1, 4.27, 4.3, 4.4, 4.5, 4.6,
5.2.5.3, 5.4, 6.2.4, 7.3 7.4, 8.2, 9.2, 9.3.1, 9.3.3, 9.4.1, 9.5, 9.6, 9.7.9.8.
9.9, .9.10, 11.1.3, 11.4.1.5, 11.4.6, 11.4.10, 12.2, 13.5, 13.7.14

Loss of Use Insurance

11.4.3

Material Suppliers

1.6, 3.12.1,
4.2.4, 4.2.6, 5.2.1, 9.3, 9.4.2, 9.6, 9.10.5

Materials, Hazardous

10.2.4, 10.3,
10.5

Materials, Labor, Equipment and

1.1.3, 1.1.6,
1.6.1, 3.4, 3.5.1, 3.8.2, 3.8.23, 3.12, 3.13

3.15.1, 4.2.6,
4.2.7, 5.2.1, 6.2.1, 7.3.6, 9.3.2, 9.3.3, 9.5.1.3, 9.10.2, 10.2.1, 10.2.4,
14.2.1.2

 

5

 

Means, Methods, Techniques,
Sequences and Procedures of Construction

3.3.1,
3.12.10, 4.2.2, 4.2.7, 9.4.2

Mechanic’s Lien

4.4.8

Mediation

4.4.1, 4.4.5,
4.4.6, 4.4.8, 4.5, 4.6.1, 4.6.2, 8.3.1, 10.5

Minor Changes in the Work

1.1.1, 3.12.8,
4.2.8, 4.3.6, 7.1, 7.4

MISCELLANEOUS PROVISIONS

13

Modifications, Definitions of

1.1.1

Modification to the Contract

1.1.1, 1.1.2,
3.7.3, 3.11, 4.1.2, 4.2.1, 5.2.3, 7, 8.3.1, 9.7, 10.3.2, 11.4.1

Mutual Responsibility

6.2

Nonconforming Work, Acceptance
of

9.6.6, 9.9.3,
12.3

Nonconforming Work, Rejection
and Correction of

2.3, 2.4,
3.5.1, 4.2.6, 6.2.5, 9.5.1, 9.8.2, 9.9.3, 9.10.4, 12.2.1, 13.7.1.3

Notice

2.2.1, 2.3,
2.4, 3.2.3, 3.3.1, 3.9, 3.12.9, 3.12.10, 4.3, 4.4.8, 4.6.5, 5.2.1, 8.2.2, 9.7,
9.10, 10.2.2, 10.3, 11.1.3, 11.4.6, 12.2.2, 12.2.4, 13.3, 14

Notice of Testing and
Inspections

13.5.1, 13.5.2

Notice to Proceed

8.2.2

Notices, Permits, Fees and

2.2.2, 3.7,
3.13, 7.3.6.4, 10.2.2

Observations, Contractor’s

1.5.2, 3.2,
3.7.3, 4.3.4

Occupancy

2.2.2, 9.6.6,
9.8, 11.4.1.5

Orders, Written

1.1.1, 2.3,
3.9, 4.3.6, 7, 8.2.2, 11.4.9, 12.1, 12.2, 13.5.2, 14.3.1

OWNER

2

Owner, Definition of

2.1

Owner, Information and Services
Required of the

2.1.2, 2.2,
3.2.1, 3.12.4, 3.12.10, 4.2.7, 4.3.3, 6.1.3, 6.1.4, 6.2.5, 9.3.2, 9.6.1, 9.6.4,
9.9.2, 9.10.3, 10.3.3, 11.2, 11.4, 13.5.1, 13.5.2, 14.1.1.4, 14.1.4

Owner’s Authority

1.6, 2.1.1,
2.3, 2.4, 3.4.2, 3.8.1, 3.12.10, 3.14.2, 4.1.2, 4.1.3, 4.2.4, 4.2.9, 4.3.6,
4.4.7, 5.2.1, 5.2.4, 5.4.1, 6.1, 6.3, 7.2.1, 7.3.1, 8.2.2, 8.3.1, 9.3.1, 9.3.2,
9.5.1, 9.9.1, 9.10.2, 10.3.2, 11.1.3, 11.3.1, 11.4.3, 11.4.10, 12.2.2, 12.3.1,
13.2.2, 14.3, 14.4

Owner’s Financial Capability

2.2.1, 13.2.2,
14.1.1.5

Owner’s Liability Insurance

11.2

Owner’s Loss of Use Insurance

11.4.3

Owner’s Relationship with
Subcontractor

1.1.2, 5.2,
5.3, 5.4, 9.6.4, 9.10.2, 14.2.2

Owner’s Right to Carry Out the
Work

2.4, 12.2.4,
14.2.2.2

Owner’s Right to Clean up

6.3

Owner’s Right to Perform
Construction and to Award Separate Contracts

6.1

Owner’s Right to Stop the Work

2.3

Owner’s Right to Suspend the
Work

14.3

Owner’s Right to Terminate the
Contract

14.2

Ownership and Use of Drawings,
Specifications and Other Instruments of Service

1.1.1, 1.6,
2.2.5, 3.2.1, 3.11.1, 3.17.1, 4.2.12, 5.3

Partial
Occupancy or Use

9.6.6, 9.9,
11.4.1.5

Patching, Cutting and

3.14, 6.2.5

Patents

3.17

Payment, Application for

4.2.5, 7.3.8,
9.2, 9.3, 9.4, 9.5.1, 9.6.3, 9.7.1, 9.8.5, 9.10.1, 9.10.3, 9.10.5, 11.1.3,
14.2.4, 14.4.3

Payment, Certificates for

4.2.5, 4.2.9,
9.3.3, 9.4, 9.5, 9.6.1, 9.6.6, 9.7.1, 9.10.1, 9.10.3, 13.7, 14.1.1.3, 14.2.4

Payment, Failure of

4.3.6,
9.5.1.3, 9.7, 9.10.2, 14.1.1.3, 14.2.1.2, 13.6

Payment, Final

4.2.1, 4.2.9,
4.3.2, 9.8.2, 9.10, 11.1.2, 11.1.3, 11.4.1, 11.4.5, 12.3.1, 13.7, 14.2.4,
14.4.3

Payment Bond, Performance Bond
and

7.3.6.4,
9.6.7, 9.10.3, 11.4.9, 11.5

Payments, Progress

4.3.3, 9.3,
9.6, 9.8.5, 9.10.3, 13.6, 14.2.3

 

6

 

PAYMENTS AND COMPLETION

9

Payments to Subcontractors

5.42, 9.5.1.3,
9.6.2, 9.6.3, 9.6.4, 9.6.7, 11.4.8, 14.2.1.2

PCB

10.3.1

Performance Bond and Payment
Bond

7.3.6.4,
9.6.7, 9.10.3, 11.4.9, 11.5

Permits, Fees and Notices

2.2.2, 3.7,
3.13, 7.3.6.4, 10.2.2

PERSONS AND PROPERTY,
PROTECTION OF

10

Polychlorinated Biphenyl

10.3.1

Product Data, Definition of

3.12.2

Product Data and Samples, Shop
Drawings

3.11, 3.12,
4.2.7

Progress and Completion

4.2.2, 4.3.3,
8.2, 9.8, 9.9.1, 14.1.4

Progress Payments

4.3.3, 9.3,
9.6, 9.8.5, 9.10.3, 13.6, 14.2.3

Project, Definition of the

1.1.4

Project Management Protective
Liability Insurance

11.3

Project Manual, Definition of
the

1.1.7

Project Manuals

2.2.5

Project Representatives

4.2.10

Property Insurance

10.2.5, 11.4

PROTECTION OF PERSONS AND
PROPERTY

10

Regulations and Laws

1.6, 3.2.2,
3.6, 3.7, 3.12.10, 3.13, 4.1.1, 4.4.8, 4.6, 9.6.4, 9.9.1, 10.2.2, 11.1, 11.4,
13.1, 13.4, 13.5.1, 13.5.2, 13.4, 14

Rejection of Work

3.5.1, 4.2.6,
12.2.1

Releases and Waivers of Liens

9.10.2

Representations

1.5.2, 3.5.1,
3.12.6, 6.2.2, 8.2.1, 9.3.3, 9.4.2, 9.5.1, 9.8.2, 9.10.1

Representatives

2.1.1, 3.1.1,
3.9, 4.1.1, 4.2.1, 4.2.10, 5.1.1, 5.1.2, 13.2.1

Resolution of Claims and
Disputes

4.4, 4.5, 4.6

Responsibility for Those
Performing the Work

3.3.2, 3.18,
4.2.3, 4.3.8, 5.3.1, 6.1.3, 6.2, 6.3, 9.5.1, 10

Retainage

9.3.1, 9.6.2,
9.8.5, 9.9.1, 9.10.2, 9.10.3

Review of Contract Documents
and Field Conditions by Contractor

1.5.2, 3.2,
3.7.3, 3.12.7, 6.1.3

Review of Contractor’s
Submittals by Owner and Architect

3.10.1,
3.10.2, 3.11, 3.12, 4.2, 5.2, 6.1.3, 9.5, 9.8.2

Review of Shop Drawings,
Product Data and Samples by Contractor

3.12

Rights and Remedies

1.1.2, 2.3,
2.4, 3.5.1, 3.15.2, 4.2.6, 4.3.4, 4.5, 4.6, 5.3, 5.4, 6.1, 6.3, 7.3.1, 8.3,
9.5.1, 9.7, 10.2.5, 10.3, 12.2.2, 12.2.4, 13.4, 14

Royalties, Patents and
Copyrights

3.17

Rules and Notices for
Arbitration

4.6.2

Safety or Persons and Property

10.2, 10.6

Safety Precautions and Programs

3.3.1, 4.2.2,
4.2.7, 5.3.1, 10.1, 10.2, 10.6

Samples, Definition of

3.12.3

Samples, Shop Drawings, Product
Data and

3.11, 3.12,
4.2.7

Samples at the Site, Documents
and

3.11

Schedule of Values

9.2, 9.3.1

Schedules, Construction

1.4.1.2, 3.10,
3.12.1, 3.12.2, 4.3.7.2, 6.1.3

Separate Contracts and
Contractors

1.1.4, 3.12.5,
3.14.2, 4.2.4, 4.2.7, 4.6.4, 6, 8.3.1, 11.4.7, 12.1.2, 12.2.5

Shop Drawings, Definition of

3.12.1

Shop Drawings, Product Data and
Samples

3.11, 3.12,
4.2.7

Site, Use of

3.13, 6.1.1,
6.2.1

Site Inspections

1.2.2, 3.2.1,
3.3.3, 3.7.1, 4.2, 4.3.4, 9.4.2, 9.10.1, 13.5

Site Visits, Architect’s

4.2.2, 4.2.9,
4.3.4, 9.4.2, 9.5.1, 9.9.2, 9.10.1, 13.5

Special Inspections and Testing

4.2.6, 12.2.1,
13.5

Specifications, Definition of
the

1.1.6

 

7

 

Specifications, The

1.1.1, 1.1.6,
1.1.7, 1.2.2, 1.6, 3.1.1, 3.12.10, 3.17

Statute of Limitations

4.6.3, 12.2.6,
13.7

Stopping the Work

2.3, 4.3.4,
9.7, 10.3, 14.1

Stored Materials

6.2.1, 9.3.2,
10.2.1.2, 10.2.4, 11.4.1.4

Subcontractor, Definition of

5.1.1

SUBCONTRACTORS

5

Subcontractors, Work by

1.2.2, 3.3.2,
3.12.1, 4.2.3, 5.2.3, 5.3, 5.4, 9.3.1.2, 9.6.7

Subcontractual Relations

5.3, 5.4,
9.3.1.2, 9.6, 9.10, 10.2.1, 11.4.7, 11.4.8, 14.1, 14.2.1, 14.3.2

Submittals

1.6, 3.10,
3.11, 3.12, 4.2.7, 5.2.1, 5.2.3, 7.3.6, 9.5, 9.3, 9.8, 9.9.1, 9.10.2, 9.10.3,
11.1.3

Subrogation, Waivers of

6.1.1, 11.4.5,
11.4.7

Substantial Completion

4.2.9, 8.1.1,
8.1.3, 8.2.3, 9.4.2, 9.8, 9.9.1, 9.10.3, 9.10.4.2, 12.2, 13.7

Substantial Completion,
Definition of

9.8.1

Substitution of Subcontractors

5.2.3, 5.2.4

Substitution of Architect

4.1.3

Substitutions of Materials

3.4.2, 3.5.1,
7.3.7

Sub-subcontractor, Definition
of

5.1.2

Subsurface Conditions

4.3.4

Successors and Assigns

13.2

Superintendent

3.9, 10.2.6

Supervision and Construction
Procedures

1.2.2, 3.3,
3.4, 3.12.10, 4.2.2, 4.2.7, 4.3.3, 6.1.3, 6.2.4, 7.1.3, 7.3.6, 8.2, 8.3.1,
9.4.2, 10, 12, 14

Surety

4.4.7,
5.4.1.2, 9.8.5, 9.10.2, 9.10.3, 14.2.2

Surety, Consent of

9.10.2, 9.10.3

Surveys

2.2.3

Suspension by the Owner for
Convenience

14.4

Suspension of the Work

5.4.2, 14.3

Suspension or Termination of
the Contract

5.3.6, 5.4.1.1,
11.4.9, 14

Taxes

3.6, 3.8.2.1,
7.3.6.4

Termination by the Contractor

4.3.10, 14.1

Termination by the Owner for
Cause

4.3.10,
5.4.1.1, 14.2

Termination of the Architect

4.1.3

Termination of the Contractor

14.2.2

TERMINATION OR SUSPENSION OF
THE CONTRACT

14

Tests and Inspections

3.1.3, 3.3.3,
4.2.2, 4.2.6, 4.2.9, 9.4.2, 9.8.3, 9.9.2, 9.10.1, 10.3.2, 11.4.1.1, 12.2.1,
13.5

TIME

8

Time, Delays and Extensions of

3.2.3, 4.3.1,
4.3.4, 4.3.7, 4.4.5, 5.2.3, 7.2.1, 7.3.1, 7.4.1, 7.5.1, 8.3, 9.5.1, 9.7.1,
10.3.2, 10.6.1, 14.3.2

Time Limits

2.1.2, 2.2,
2.4, 3.2.1, 3.7.3, 3.10, 3.11, 3.12.5, 3.15.1, 4.2, 4.3, 4.4, 4.5, 4.6, 5.2,
5.3, 5.4, 6.2.4, 7.3, 7.4, 8.2, 9.2, 9.3.1, 9.3.3, 9.4.1, 9.5, 9.6, 9.7, 9.8,
9.9, 9.10, 11.1.3, 11.4.1.5, 11.4.6, 11.4.10, 12.2, 13.5, 13.7.14

Time Limits on Claims

4.3.2, 4.3.4,
4.3.8, 4.4, 4.5, 4.6

Title to Work

9.3.2, 9.3.3

UNCOVERING AND CORRECTION OF
WORK

12

Uncovering of Work

12.1

Unforeseen Conditions

4.3.4, 8.3.1,
10.3

Unit Prices

4.3.9, 7.3.3.2

Use of Documents

1.1.1, 1.6,
2.2.5, 3.12.6, 5.3

Use of Site

3.13, 6.1.1,
6.2.1

Values, Schedule of

9.2, 9.3.1

Waiver of Claims by the
Architect

13.4.2

Waiver of Claims by the
Contractor

4.3.10,
9.10.5, 11.4.7, 13.4.2

 

8

 

Waiver of Claims by the Owner

4.3.10, 9.9.3,
9.10.3, 9.10.4, 11.4.3, 11.4.5, 11.4.7, 12.2.2.1, 13.4.2, 14.2.4

Waiver of Consequential Damages

4.3, 10,
14.2.4

Waiver of Liens

9.10.2, 9.10.4

Waivers of Subrogation

6.14.1,
11.4.5, 11.4.7

Warranty

3.5, 4.2.9,
4.3, 5.3, 9.3.3, 9.8.4, 9.9.1, 9.10.4, 12.2.2, 13.7.1.3

Weather Delays

4.3.7.2

Work, Definition of

1.1.3

Written Consent

1.6, 3.4.2,
3.12.8, 3.14.2, 4.1.2, 4.3.4, 4.6.4, 9.3.2, 9.8.5, 9.9.1, 9.10.2, 9.10.3,
11.4.1, 13.2, 13.4.2

Written Interpretations

4.2.11,
4.2.12, 4.3.6

Written Notice

2.3, 2.4,
3.3.1, 3.9, 3.12.9, 3.12.10, 4.3, 4.4.8, 4.6.5, 5.2.1, 8.2.2, 9.7, 9.10,
10.2.2, 10.3, 11.1.3, 11.4.6, 12.2.2, 12.2.4, 13.3.14

Written Orders

1.1.1, 2.3,
3.9, 4.3.6, 7, 8.2.2, 11.4.9, 12.1, 12.2, 13.5.2, 14.3.1

 

ARTICLE 1  GENERAL PROVISIONS

1.1    BASIC DEFINITIONS

1.1.1 THE CONTRACT DOCUMENTS

The Contract
Documents consist of the Agreement between Owner and Contractor (hereinafter
the Agreement), Conditions of the Contract (General, Supplementary and other
Conditions), Drawings, Specifications, Addenda issued prior to execution of the
Contract, other documents listed in the Agreement and Modifications issued
after execution of the Contract.  A
Modification is (1) a written amendment to the Contract signed by both parties,
(2) a  Change Order, (3) a Construction
Change Directive or (4) a written order for a minor change in the Work issued
by the Architect.  Unless specifically
enumerated in the Agreement, the Contract Documents do not include other documents
such as bidding requirements (advertisement or invitation to bid, instructions
to Bidders, sample forms, the Contractor’s bid or portions of Addenda relating
to bidding requirements).  In the event of any conflict among the Contract
Document, the Documents shall be constructed according to the following
priorities:

Highest Priority                                                      Modifications

Second Priority                                                          Owner/Contractor
Agreement

Third Priority                                                                  Addenda
[later date to take Precedence]

Fourth Priority                                                            General
Requirement

Fifth Priority                                                                       Supplementary
General Conditions of the Contract for Construction

Sixth Priority                                                                    General
Conditions of the Contract for Construction Drawings

Seventh Priority                                                      Drawings

Eighth Priority                                                             Specifications

 

1.1.2 THE CONTRACT

The Contract
Documents form the Contract for Construction. 
The Contract represents the entire and integrated agreement between the
parties hereto and supersedes prior negotiations, representations or
agreements, either written or oral.  The
Contract may be amended or

 

9

 

modified only
by a Modification.  The Contract
Documents shall not be construed to create a contractual relationship of any
kind (1) between the Architect and Contractor, (2) between the Owner and a
Subcontractor or Sub-subcontractor, (3) between the Owner and Architect or (4) between
any persons or entities other than the Owner and Contractor.  The Architect shall, however, be entitled to
performance and enforcement of obligations under the Contract intended to
facilitate performance of the Architect’s duties.

 

1.1.3 THE WORK

The term
“Work” means the construction and services required by the Contract Documents,
whether completed or partially completed, and includes all other labor,
materials, equipment and services provided or to be provided by the Contractor
to fulfill the Contractor’s obligations. 
The Work may constitute the whole or a part of the Project.

 

1.1.4 THE PROJECT

The Project is
the total construction of which the Work performed under the Contract Documents
may be the whole or a part and which may include construction by the Owner or
by separate contractors.

 

1.1.5 THE DRAWINGS

The Drawings
are the graphic and pictorial portions of the Contract Documents showing the
design, location and dimensions of the Work, generally including plans,
elevations, sections, details, schedules and diagrams.

 

1.1.6 THE SPECIFICATIONS

The
Specifications are that portion of the Contract Documents consisting of the
written requirements for materials, equipment, systems, standards and
workmanship for the Work, and performance of related services.

 

1.1.7 THE PROJECT MANUAL

The Project
Manual is a volume assembled for the Work which may include the bidding
requirements, sample forms, Conditions of the Contract and Specifications.

 

1.2    CORRELATION AND INTENT OF THE CONTRACT
DOCUMENTS

1.2.1 The intent of the Contract Documents is to
include all items necessary for the proper execution and completion of the Work
by the Contractor.  The Contract
Documents are complementary, and what is required by one shall be as binding as
if required by all; performance by the Contractor shall be required only to the
extent consistent with the Contract Documents and reasonably inferable from
them as being necessary to produce the indicated results.

 

1.2.2 Organization of the Specifications into
divisions, sections and articles, and arrangement of Drawings shall not control
the Contractor in dividing the Work among Subcontractors or in establishing the
extent of Work to be performed by any trade. 
The Contractor and all
Subcontractors shall refer to all the Drawings including those showing
primarily the Work of the mechanical, electrical and other specialized trades
and to all of the Sections of the Specifications, and shall perform all Work
reasonably Inferable therefrom as being necessary to produce the Indicated
results.

 

1.2.3 Unless otherwise stated in the Contract
Documents, words which have well-known technical or construction industry
meanings are used in the Contract Documents in accordance with such recognized
meanings.

 

 

10

 

 

1.3           CAPITALIZATION

1.3.1        Terms capitalized in
these General Conditions include those which are (1) specifically defined, (2)
the titles of numbered articles and identified references to Paragraphs,
Subparagraphs and Clauses in the document or (3) the titles of other documents
published by the American Institute of Architects.

 

1.4           INTERPRETATION

1.4.1        In the interest of
brevity the Contract Documents frequently omit modifying words such as “all”
and “any” and articles such as “the” and “an,” but the fact that a modifier or
an article is absent from one statement and appears in another is not intended
to affect the interpretation of either statement.

 

1.5                                 EXECUTION OF CONTRACT
DOCUMENTS

1.5.1        The Contract
Documents shall be signed by the Owner and Contractor.  If either the Owner or Contractor or both do
not sign all the Contract Documents, the Architect shall identify such unsigned
Documents upon request.

 

1.5.2        Execution of the
Contract by the Contractor is a representation that the Contractor has visited
the site, become generally familiar with local conditions under which the Work
is to be performed and correlated personal observations with requirements of
the Contract Documents.

 

1.6                                 OWNERSHIP AND USE OF
DRAWINGS, SPECIFICATIONS AND OTHER INSTRUMENTS OF SERVICE

1.6.1        The Drawings,
Specifications and other documents, including those in electronic form,
prepared by the Architect and the Architect’s consultants are Instruments of
Service through which the Work to be executed by the Contractor is
described.  The Contractor may retain
one record set from the commencement of
construction to the completion of the Project, and for such period of time
thereafter, to and including the date of the expiration of any and all warranty
periods for any warranties pertaining to the Work.  Neither the Contractor nor any
Subcontractor, Sub-contractor or material or equipment supplier shall own or
claim a copyright in the Drawings, Specifications and other documents prepared
by the Architect or the Architect’s Consultants, and unless otherwise indicated
the Architect and the Architect’s consultants shall be deemed the authors of
them and will retain all common law, statutory and other reserved rights, in
addition to the copyrights.  All copies
of Instruments of Service, except the Contractor’s record set, shall be
returned or suitably accounted for to the Architect, on request, upon
completion of the Work.  The Drawings,
Specifications and other documents prepared by the Architect and the
Architect’s consultants, and copies thereof furnished to the Contractor, are
for use solely with respect to this Project. 
They are not to be used by the Contractor or any Subcontractor,
Sub-subcontractor or material or equipment supplier on other projects or for
additions to this Project outside the scope of the Work without the specific
written consent of the Owner, Architect and the Architect’s consultants.  The Contractor, Subcontractors,
Sub-subcontractors and material or equipment suppliers are authorized to use
and reproduce applicable portions of the Drawings, Specifications and other
documents prepared by the Architect and the Architect’s consultants appropriate
to and for use in the execution of their Work under the Contract Documents.  All copies made under this authorization
shall bear the statutory copyright notice, if any, shown on the Drawings,
Specifications and other documents prepared by the Architect and the
Architect’s consultants, Submittal or distribution to meet official regulatory
requirements or for other purposes in connection with this Project is not to be
construed as publication in derogation of the Architect’s or Architect’s
consultants’ copyrights or other reserved rights.

 

11

 

ARTICLE 2     OWNER

2.1                                 GENERAL

2.1.1        The Owner is the
person or entity identified as such in the Agreement and is referred to
throughout the Contract Documents as if singular in number.  The Owner shall designate in writing a
representative who shall have express authority to bind the Owner with respect
to all matters requiring the Owner’s approval or authorization.  Except as otherwise provided in Subparagraph
4.2.1, the Architect does not have such authority.  The term “Owner” means the Owner or the Owner’s authorized representative.

 

2.1.2        The Owner shall
furnish to the Contractor within fifteen days after receipt of a written
request, information necessary and relevant for the Contractor to evaluate,
give notice of or enforce mechanic’s lien rights.  Such information shall include a correct statement of the record
legal title to the property on which the Project is located, usually referred
to as the site, and the Owner’s interest therein.

 

2.2                                 INFORMATION AND
SERVICES REQUIRED OF THE OWNER

2.2.1        The Owner shall,
at the written request of the Contractor, prior to commencement of the Work and
thereafter furnish to the Contractor reasonable evidence that financial
arrangements have been made to fulfill the Owner’s obligations under the
Contract.  Furnishing of such evidence
shall be a condition precedent to commencement or continuation of the
Work.  After such evidence has been
furnished, the Owner shall not materially vary such financial arrangements
without prior notice to the Contractor.

 

2.2.2        Except for permits
and fees, including those required under Subparagraph 3.7.1, which are the
responsibility of the Contractor under the Contract Documents, the Owner shall
secure and pay for necessary approvals, easements, assessments and charges
required for construction, use or occupancy of permanent structures or for
permanent changes in existing facilities.

 

2.2.3        The Owner shall
furnish surveys describing physical characteristics, legal limitations and
utility locations for the site of the Project, and a legal description of the
site.  The Contractor shall be entitled
to rely on the accuracy of information furnished by the Owner but shall
exercise proper precautions relating to the safe performance of the Work.

 

2.2.4        Information or
services required of the Owner by the Contract Documents shall be furnished by
the Owner with reasonable promptness. 
Any other information or services relevant to the Contractor’s
performance of the Work under the Owner’s control shall be furnished by the
Owner after receipt from the Contractor of a written request for such
information or services.

 

2.2.5        Unless otherwise
provided in the Contract Documents, the Contractor will be furnished, free of
charge, such copies of Drawings and Project Manuals as are reasonably necessary
for execution of the Work.

 

2.3                                 OWNER’S RIGHT TO STOP
THE WORK

2.3.1        If the Contractor
fails to correct Work which is not in accordance with the requirements of the
Contract Documents as required by Paragraph 12.2 or persistently fails to carry
out Work in accordance with the Contract Documents, the Owner may issue a
written order to the Contractor to stop the Work, or any portion thereof, until
the cause for such order has been eliminated; however, the right of the Owner
to stop the Work shall not give rise to a duty on the part of the Owner to
exercise this right for the benefit of the Contractor or any other person or
entity, except to the extent required by Subparagraph 6.1.3.

 

12

 

2.4                                 OWNER’S RIGHT TO CARRY
OUT THE WORK

2.4.1        If the Contractor
defaults or neglects to carry out the Work in accordance with the Contract
Documents and fails within a seven day period after receipt of written notice
from the Owner to commence and continue correction of such default or neglect
with diligence and promptness, the Owner may after such seven day period give
the Contractor a second written notice to correct such deficiencies within a
three day period.  If the Contractor
within such three day period after receipt of such second notice fails to
commence and continue to correct any deficiencies, the Owner may, without
prejudice to other remedies the Owner may have, correct such deficiencies.  If the
Contractor defaults or neglects to carry out the Work in accordance with the
Contract Documents and fails within a seven-day period after receipt of written
notice from the Owner to begin and prosecute correction of such default or
neglect with diligence and promptness the Owner may without prejudice to other
remedies the Owner may have, correct such deficiencies.  In such case an appropriate Change Order
shall be issued deducting from payments then or thereafter due the Contractor
the reasonable cost of correcting such deficiencies, including Owner’s expenses
and compensation for the Architect’s additional services made necessary by such
default, neglect or failure.  Such
action by the Owner and amounts charged to the Contractor are both subject to
prior approval of the Architect.  If
payments then or thereafter due the Contractor are not sufficient to cover such
amounts, the Contractor shall pay the difference to the Owner.

 

ARTICLE 3     CONTRACTOR

3.1                                 GENERAL

3.1.1        The Contractor is the
person or entity identified as such in the Agreement and is referred to
throughout the Contract Documents as if singular in number.  The term “Contractor” means the Contractor
or the Contractor’s authorized representative.

 

3.1.2        The Contractor shall
perform the Work in accordance with the Contract Documents.

 

3.1.3        The Contractor shall
not be relieved of obligations to perform the Work in accordance with the
Contract Documents either by activities or duties of the Architect in the
Architect’s administration of the Contract, or by tests, inspections or
approvals required or performed by persons other than the Contractor.

 

3.2                                 REVIEW OF CONTRACT
DOCUMENTS AND FIELD CONDITIONS BY CONTRACTOR

3.2.1        Since the Contract
Documents are complementary before starting each portion of the Work Before starting the Work, and at frequent intervals
during the progress thereof the Contractor shall carefully study
and compare the various Drawings and other Contract Documents relative
to that portion of the Work, as well as the information with each other and with the information
furnished by the Owner pursuant to Subparagraph 2.2.3, and  shall at once report to the Architect and Owner any error,
inconsistency or omission the Contractor may discover.  Any necessary change shall be ordered as
provided in Article 7 subject to the requirement of Paragraph 1.2 and other
provisions of the Contract Documents. 
If the Contractor proceeds with the Work without such notice to the
Architect having discovered and having thereby obtained actual knowledge of
such errors, inconsistencies or omissions, the Contractor shall bear all costs
arising therefrom, take

 

13

 

field measurements of any existing conditions related to that portion
of the Work and shall observe any conditions at the site affecting it.  These obligations are for the purpose of
facilitating construction by the Contractor and are not for the purpose of
discovering errors, omissions, or inconsistencies in the Contract Documents;
however, any errors, inconsistencies or omissions discovered by the Contractor
shall be reported promptly to the Architect as a request for information in
such form as the Architect may require.

 

3.2.2        Any design errors or
omissions noted by the Contractor during this review shall be reported promptly
to the Architect, but it is recognized that the Contractor’s review is made in
the Contractor’s capacity as a contractor and not as a licensed design
professional unless otherwise specifically provided in the Contract
Documents.  The Contractor is not
required to ascertain that the Contract Documents are in accordance with
applicable laws, statutes, ordinances, building codes, and rules and
regulations, but any nonconformity discovered by or made known to the
Contractor shall be reported promptly to the Architect.

 

3.2.3        If the Contractor
believes that additional cost or time is involved because of clarifications or
instructions issued by the Architect in response to the Contractor’s notices or
request for information pursuant to Subparagraphs 3.2.1 and 3.2.2, the
Contractor shall make Claims as provided in Subparagraphs 4.3.6 and 4.3.7.  If the Contractor fails to perform the
obligations of Subparagraphs 3.2.1 and 3.2.2, the Contractor shall pay such
costs and damages to the Owner as would have been avoided if the Contractor had
performed such obligations.  The
Contractor shall not be liable to the Owner or Architect for damages resulting
from errors, inconsistencies or omissions in the Contract Documents or for
differences between field measurements or conditions and the Contract Documents
unless the Contractor recognized such error, inconsistency, omission or
difference and knowingly failed to report it to the Architect.

 

3.2.4       The
Contractor shall not proceed with any Work that Contractor knows is not clearly
and consistently defined in detail in the Contract Documents, but shall request
additional drawings or instructions from the Architect as provided in
Subparagraph 3.2.3.  If the Contractor
proceeds with Work that Contractor knows is not clearly and consistently
defined in detail in the Contract Documents without obtaining further Drawings,
Specifications or Instructions, the Contractor shall correct Work incorrectly
done at the Contractor’s own expense.

 

3.3                                 SUPERVISION AND
CONSTRUCTION PROCEDURES

3.3.1        The Contractor shall
supervise and direct the Work, using the Contractor’s best skill and
attention.  The Contractor shall be
solely responsible for and have control over construction means, methods,
techniques, sequences and procedures and for coordinating all portions of the
Work under the Contract, unless the Contract Documents give other specific
instructions concerning these matters. 
If the Contract Documents give specific instructions concerning
construction means, methods, techniques, sequences or procedures, the
Contractor shall evaluate the jobsite safety thereof and, except as stated
below, shall be fully and solely responsible for the jobsite safety of such
means, methods, techniques, sequences or procedures.  If the Contractor determines that such means, methods,
techniques, sequences or procedures may not be safe, the Contractor shall give
timely written notice to the Owner and Architect and shall not proceed with
that portion of the Work without further written instructions from the
Architect.  If the Contractor is then
instructed to proceed with the required means, methods, techniques, sequences
or procedures without acceptance of changes proposed by the Contractor, the
Owner shall be solely responsible for any resulting loss or damage.

 

14

 

3.3.2        The Contractor shall
be responsible to the Owner for acts and omissions of the Contractor’s
employees, Subcontractors and their agents and employees, and other persons or
entities performing portions of the Work for or on behalf of the Contractor or
any of its Subcontractors.

 

3.3.3        The Contractor shall
be responsible for inspection of portions of Work already performed to
determine that such portions are in proper condition to receive subsequent
Work.

 

3.4                                 LABOR AND MATERIALS

3.4.1        Unless otherwise
provided in the Contract Documents, the Contractor shall provide and pay for
labor, materials, equipment, tools, construction equipment and machinery,
water, heat, utilities, transportation, and other facilities and services
necessary for proper execution and completion of the Work, whether temporary or
permanent and whether or not incorporated or to be incorporated in the Work.

 

3.4.2        The Contractor may
make substitutions only with the consent of the Owner, after evaluation by the
Architect and in accordance with a Change Order.

 

3.4.3        The Contractor shall
enforce strict discipline and good order among the Contractor’s employees and
other persons carrying out the Contract. 
The Contractor shall not permit employment of unfit persons or persons
not skilled in tasks assigned to them.

 

3.5                                 WARRANTY

3.5.1        The Contractor
warrants to that the
Owner and Architect that materials and equipment furnished under the
Contract will be of good quality and new  new and of recent manufacture unless otherwise specified  required or permitted by
the Contract Documents, that the Work will be free from defects not inherent in
the quality required or permitted, and that the all Work will conform to the
requirements of the Contract Documents  be
of good quality, free from faults and defects and in conformance with the
Contract Documents. 
Work not conforming to these requirements, including substitutions not
properly approved and authorized, may be considered defective.  The Contractor’s warranty excludes remedy
for damage or defect caused by abuse, modifications not executed by the
Contractor, improper or insufficient maintenance, improper operation, or normal
wear and tear and normal usage.  If
required by the Architect, the Contractor shall furnish satisfactory evidence
as to the kind and quality of materials and equipment.

 

3.5.2       The
Contractor shall be responsible for determining that all materials furnished
for the Work meet all requirements of the Contract Documents.  The Architect may require the Contractor to
produce reasonable evidence that a material meets such requirements such as
certified reports of past tests by qualified testing laboratories reports of
studies by qualified experts, or other evidence which, in the opinion of the
Architect, would lead to a reasonable certainty that all material used or proposed
to be used in the Work meets the requirements of the Contract Documents.  All such data shall be furnished at the
Contractor’s expense.  This provision
shall not require the Contractor to pay for periodic testing

 

15

 

of different batches of the same material
unless such testing is specifically required by the Contract Documents to be
performed at the Contractor’s expense.

 

3.5.3       In
all cases in which a manufacturer’s name, trade name, or other proprietary
designation is used in connection with materials or articles to be furnished
under this Contract, whether or not the phrase “or equal” is used after such
name, the Contractor shall furnish the product of the named manufacturer(s)
without substitution unless a written request for a substitute has been
submitted by the Contractor and approved in writing by the Architect as
provided in Subparagraph 3.5.4.

 

3.5.4       If
the Contractor proposes to use a material which while suitable for the intended
use deviates in any way from the detailed requirements of the Contract
Documents the Contractor shall inform the Architect in writing of the nature of
such deviations at the time the material is submitted for approval and shall
request written approval of the deviation from the requirements of the Contract
Documents.

 

3.5.5       In
requesting approval of deviations or substitutions the Contractor shall provide
upon request evidence leading to a reasonable certainty that the proposed
substitution or deviation will provide a quality of result at least equal to
that otherwise attainable.  If in the
opinion of the Architect, the evidence presented by the Contractor does not
provide a sufficient basis for such reasonable certainty the Architect may
reject such substitutions or deviations without further investigation.

 

3.5.6       The
Architect shall judge the design and the Owner shall judge the appearance of
proposed substitutes on the basis of their suitability in relation to the
overall Project, as well as for their intrinsic merits, in order to permit
coordinated design of color and finish texture or pattern which would have been
available from the manufacturer originally specified, at no additional cost to
the Owner.  Neither the Architect nor
the Owner will approve as equal to materials specified, proposed substitutes
which in the Owner’s opinion, would be out of character, obtrusive or otherwise
inconsistent with the character or quality of the Project, or in which, in the
Architect’s opinion, would not be appropriate to the design of the Project.

 

16

 

3.5.7       Any
additional cost, or any loss or damage arising from the substitution of any
material or any method for those originally specified shall be borne by the
Contractor notwithstanding approval or acceptance of such substitution by the
Owner or the Architect, unless such substitution was made at the written
request or direction of the Owner or the Architect.

 

3.5.8       The
warranty provided in this Paragraph 3.5 shall be in addition to and not in
limitation of any other warranty required by the Contract Documents or
otherwise prescribed or permitted by law.

 

3.5.9       The
Contractor shall procure and deliver to the Architect, no later than the date
claimed by the Contractor as the date of Substantial Completion, all special
warranties required by the Contract Documents. 
Delivery by the Contractor shall constitute the Contractor’s guarantee
to the Owner that the warranty will be performed in accordance with its terms
and conditions.

 

3.6                                 TAXES

3.6.1        The Contractor shall
pay sales, consumer, use and similar taxes for the Work provided by the
Contractor which are legally enacted when bids are received or negotiations
concluded, whether or not yet effective or merely scheduled to go into effect.

 

3.7                                 PERMITS, FEES AND
NOTICES

3.7.1        Unless otherwise
provided in the Contract Documents, the Contractor shall secure and pay for the
building permit and other permits and governmental fees, licenses and
inspections necessary for proper execution and completion of the Work which are
customarily secured after execution of the Contract and which are legally
required when bids are received or negotiations concluded.

 

3.7.2        The Contractor shall
comply with and give notices required by laws, ordinances, rules, regulations
and lawful orders of public authorities applicable to performance of the Work.

 

3.7.3        It is not the
Contractor’s responsibility to ascertain that the Contract Documents are in
accordance with applicable laws, statutes, ordinances, building codes, and
rules and regulations.  However, if the
Contractor observes that portions of the Contract Documents are at variance
therewith, the Contractor shall promptly notify the Architect and Owner in
writing, and necessary changes shall be accomplished by appropriate
Modification.

 

3.7.4        If the Contractor
performs Work knowing it to be contrary to laws, statutes, ordinances, building
codes, and rules and regulations without such notice to the Architect and
Owner, the Contractor shall assume appropriate responsibility for such Work and
shall bear the costs attributable to correction.

 

3.7.5       The
Contractor agrees that, unless otherwise agreed by the Owner all governmental
permits, licenses, and notification with respect to the Work shall be
coordinated through the Owner and, where appropriate, the Architect in
accordance with any legal

 

17

 

requirements attached to the Specifications.
No application for permits, licenses of any kind and no notifications to
governmental authorities may be made by Contractor without the prior written
approval of the Owner and the Architect. 
All dealings with governmental officials with respect to the Work shall
be coordinated with the Owner or its designated representative.  The Owner and the Contractor shall agree
upon a reasonable procedure to handle normal and customary inspections of the
Work by governmental officials during the progress thereof.

 

3.8                                 ALLOWANCES

3.8.1        The Contractor shall
include in the Contract Sum all allowances stated in the Contract
Documents.  Items covered by allowances
shall be supplied for such amounts and by such persons or entities as the Owner
may direct, but the Contractor shall not be required to employ persons or
entities to whom the Contractor has reasonable objection.

 

3.8.2        Unless otherwise
provided in the Contract Documents:

 

.1               allowances
shall cover the cost to the Contractor of materials and equipment delivered at
the site and all required taxes, less applicable trade discounts;

.2               Contractor’s
costs for unloading and handling at the site, labor, installation costs,
overhead, profit and other expenses contemplated for stated allowance amounts
shall be included in the Contract Sum but not in the allowances;

.3               whenever
costs are more than or less than allowances, the Contract Sum shall be adjusted
accordingly by Change Order.  The amount
of the Change Order shall reflect (1) the difference between actual costs and
the allowances under Clause 3.8.2.1 and (2) changes in Contractor’s costs under
Clause 3.8.2.2.

 

3.8.3        Materials and
equipment under an allowance shall be selected by the Owner in sufficient time
to avoid delay in the Work.

 

3.9                                 SUPERINTENDENT

3.9.1        The Contractor shall
employ a competent superintendent and necessary assistants who shall be in
attendance at the Project site during performance of the Work.  The superintendent shall represent the
Contractor, and communications given to the superintendent shall be as binding
as if given to the Contractor. 
Important communications shall be confirmed in writing.  Other communications shall be similarly
confirmed on written request in each case.

 

3.9.2       The
Contractor shall be totally responsible for and shall coordinate and supervise
the Work performed by Subcontractors to the end that the Work is carried out
without conflict between trades and so that no trade at any time causes delay
to the general progress of the Work. 
The Contractor and all Subcontractors shall at all times afford each
trade, any separate contractor or the Owner every reasonable opportunity for
the installation of Work and the storage of materials.

 

18

 

3.9.3       The
Contractor shall arrange for and attend job meetings with the Architect and
such other persons as the Architect may from time-to-time wish to have
present.  The Contractor shall be
represented by a principal the project manager, general superintendent of other
authorized main office representative, as well as by the Contractor’s own
superintendent.  An authorized representative
of any Subcontractor or Sub-subcontractor shall attend such meetings if the
representative’s presence is requested by the Owner, Architect or
Contractor.  Such representatives shall
be empowered to make binding commitments on all matters to be discussed at such
meetings including costs, payment, change orders, time schedules and
manpower.  Any notices required under
the Contract may be served on such representatives.

 

3.10                           CONTRACTOR’S CONSTRUCTION
SCHEDULES

3.10.1      The Contractor,
promptly after being awarded the Contract, shall prepare and submit for the
Owner’s and Architect’s information a Contractor’s construction schedule for
the Work.  The schedule shall not exceed
time limits current under the Contract Documents, shall be revised at
appropriate intervals as required by the conditions of the Work and Project,
shall be related to the entire Project to the extent required by the Contract
Documents, and shall provide for expeditious and practicable execution of the
Work.

 

3.10.2      The Contractor shall
prepare and keep current, for the Architect’s approval, a schedule of
submittals which is coordinated with the Contractor’s construction schedule and
allows the Architect reasonable time to review submittals.

 

3.10.3      The Contractor shall
perform the Work in general accordance with the most recent schedules submitted
to the Owner and Architect.

 

3.11                           DOCUMENTS AND SAMPLES AT THE
SITE

3.11.1      The Contractor shall
maintain at the site for the Owner one record copy of the Drawings,
Specifications, Addenda, Change Orders and other Modifications, in good order
and marked currently to record field changes and selections made during
construction, and one record copy of approved Shop Drawings, Product Data,
Samples and similar required submittals. 
These shall be available to the Architect and shall be delivered to the
Architect for submittal to the Owner upon completion of the Work.

 

3.12                           SHOP DRAWINGS, PRODUCT DATA
AND SAMPLES

3.12.1      Shop Drawings are
drawings, diagrams, schedules and other data specially prepared for the Work by
the Contractor or a Subcontractor, Sub-subcontractor, manufacturer, supplier or
distributor to illustrate some portion of the Work.

 

3.12.2      Product Data are
illustrations, standard schedules, performance charts, instructions, brochures,
diagrams and other information furnished by the Contractor to illustrate
materials or equipment for some portion of the Work.

 

3.12.3      Samples are physical
examples which illustrate materials, equipment or workmanship and establish
standards by which the Work will be judged.

 

19

 

3.12.4      Shop Drawings, Product
Data, Samples and similar submittals are not Contract Documents.  The purpose of their submittal is to
demonstrate for those portions of the Work for which submittals are required by
the Contract Documents the way by which the Contractor proposes to conform to
the information given and the design concept expressed in the Contract
Documents.  Review by the Architect is subject
to the limitations of Subparagraph 4.27. 
Informational submittals upon which the Architect is not expected to
take responsive action may be so identified in the Contract Documents.  Submittals which are not required by the
Contract Documents may be returned by the Architect without action.

 

3.12.5      The Contractor shall
review for compliance with the Contract Documents, approve and submit to the
Architect Shop Drawings, Product Data, Samples and similar submittals required
by the Contract Documents with reasonable promptness and in such sequence as to
cause no delay in the Work or in the activities of the Owner or of separate
contractors.  Submittals which are not
marked as reviewed for compliance with the Contract Documents and approved by
the Contractor may be returned by the Architect without action.

 

3.12.6      By approving and
submitting Shop Drawings, Product Data, Samples and similar submittals, the
Contractor thereby
represents that the Contractor has determined and verified all dimensions, quantities, field dimensions,
relations to existing work to be installed later, coordination with information
on previously accepted Shop Drawing, Product Date, Samples, or similar
submittals and verification of compliance with all the requirements of the
Contract Documents. 
materials, field measurements and field construction criteria related
thereto or will do so, and has checked and coordinated the information
contained within such submittals with the requirements of the Work and of the
Contract-Documents.

 

3.12.7      The Contractor shall
perform no portion of the Work for which the Contract Documents require
submittal and review of Shop Drawings, Product Data, Samples or similar
submittals until the respective submittal has been approved by the Architect.

 

3.12.8      The Work shall be in
accordance with approved submittals except that the Contractor shall not be
relieved of responsibility for deviations from requirements of the Contract
Documents by the Architect’s approval of Shop Drawings, Product Data, Samples
or similar submittals unless the Contractor has specifically informed the
Architect in writing of such deviation at the time of submittal and (1) the
Architect has given written approval to the specific deviation as a minor
change in the Work, or (2) a Change Order or Construction Change Directive has been
issued authorizing the deviation.  The
Contractor shall not be relieved of responsibility for errors or omissions in
Shop Drawings, Product Data, Samples or similar submittals by the Architect’s
approval thereof.

 

3.12.9      The Contractor shall
direct specific attention, in writing or on resubmitted Shop Drawings, Product
Data, Samples or similar submittals, to revisions other than those requested by
the Architect on previous submittals. 
In the absence of such written notice the Architect’s approval of a
resubmission shall not apply to such revisions.

 

3.12.10    The Contractor shall
not be required to provide professional services which constitute the practice
of architecture or engineering unless such services are specifically required
by the Contract Documents for a portion of the Work or unless the Contractor
needs to provide such services in order to carry out the Contractor’s
responsibilities for construction means, methods, techniques, sequences and
procedures.  The Contractor shall not be
required to provide professional services in violation of applicable law.  If professional design services or
certifications by a design professional related to systems, materials or
equipment are specifically

 

20

 

required of the Contractor by the Contract Documents, the Owner and the
Architect will specify all performance and design criteria that such services
must satisfy.  The Contractor shall
cause such services or certifications to be provided by a properly licensed
design professional, whose signature and seal shall appear on all drawings,
calculations, specifications, certifications, Shop Drawings and other
submittals prepared by such professional. 
Shop Drawings and other submittals related to the Work designed or
certified by such professional, if prepared by others, shall bear such
professional’s written approval when submitted to the Architect.  The Owner and the Architect shall be
entitled to rely upon the adequacy, accuracy and completeness of the services,
certifications or approvals performed by such design professionals, provided
the Owner and Architect have specified to the Contractor all performance and
design criteria that such services must satisfy. Pursuant to this Subparagraph
3.12.10, the Architect will review, approve or take other appropriate action on
submittals only for the limited purpose of checking for conformance with
information given and the design concept expressed in the Contract
Documents.  The Contractor shall not be
responsible for the adequacy of the performance or design criteria required by
the Contract Documents.

 

3.13                           USE OF SITE

3.13.1      The Contractor
shall confine operations of the site to areas permitted by laws, ordinances,
permits and the Contract Documents and shall not unreasonably encumber the site
with materials or equipment.  The right of possession of the premises and the
improvements made thereon by the Contractor shall remain at all times in the
Owner.  The Contractor’s right to entry
and use thereof arises solely from the permission granted by the Owner under
the Contract Documents.  The Contractor
shall confined the Contractor’s apparatus the storage of materials and the
operations of the Contractor’s workmen to limits indicated by law, ordinances
the Contract Documents and permits and/or directions of the Architect and shall
not unreasonably encumber the premises with the Contractor’s materials.  The Owner shall not be liable to the
Contractor, the Subcontractors, their employees or anyone else with respect to
the conditions of the premises, except only for a condition caused directly and
solely by the negligence of the Owner.

 

3.14                           CUTTING AND PATCHING

3.14.1      The Contractor shall
be responsible for cutting, fitting or patching required to complete the Work
or to make its parts fit together properly.

 

3.14.2      The Contractor shall
not damage or endanger a portion of the Work or fully or partially completed
construction of the Owner or separate contractors by cutting, patching or
otherwise altering such construction, or by excavation.  The Contractor shall not cut or otherwise
alter such construction by the Owner or a separate contractor except with
written consent of the Owner and of such separate contractor, such consent
shall not be unreasonably withheld.  The
Contractor shall not unreasonably withhold from the Owner or a separate
contractor the Contractor’s consent to cutting or otherwise altering the Work.

 

3.15                           CLEANING UP

3.15.1      The Contractor shall
keep the premises and surrounding area free from accumulation of waste materials
or rubbish caused by operations under the Contract.  At completion of the Work, the Contractor shall remove from and
about the Project waste materials, rubbish, the Contractor’s tools,
construction equipment, machinery and surplus materials.

 

21

 

3.15.2      If the Contract fails
to clean up as provided in the Contract Documents, the Owner may do so and the
cost thereof shall be charged to the Contractor.

 

3.16                           ACCESS TO WORK

3.16.1      The Contractor shall provide
the Owner and Architect access to the Work in preparation and progress wherever
located.

 

3.17                           ROYALTIES, PATENTS AND
COPYRIGHTS

3.17.1      The Contractor shall
pay all royalties and license fees.  The
Contractor shall defend suits or claims for infringement of copyrights and
patent rights and shall hold the Owner and Architect harmless from loss on
account thereof, but shall not be responsible for such defense or loss when a
particular design, process or product of a particular manufacturer or manufacturers
is required by the Contract Documents or where the copyright violations are
contained in Drawings, Specifications or other documents prepared by the Owner
or Architect.  However, if the
Contractor has reason to believe that the required design, process or product
is an infringement of a copyright or a patent, the Contractor shall be
responsible for such loss unless such information is promptly furnished to the
Architect.

 

3.18                           INDEMNIFICATION

3.18.1      To the fullest extent
permitted by law and to the claims, damages, losses or expense are not covered
by Project Management Protective Liability insurance purchased by the
Contractor in accordance with Paragraph 11.3, the Contractor shall indemnify
and hold harmless the Owner, Architect, Architect’s consultants, and agents and
employees of any of them from and against claims, damages, losses and expenses,
including their respective parent,
affiliate and subsidiary companies and their respective directors, officers,
partners, employees and agents from and against claims, damages, losses and
expenses (direct or indirect including but not limited to consequential and
special damages),  including but not limited to attorney’s
fees, arising out of or resulting from performance of the Work, provided that
such claim, damage, loss or expense is attributable to bodily injury, sickness,
disease or death, or to injury to or destruction of tangible property (other
than the Work itself), including loss of
use resulting therefrom to the extent covered by insurance,
but only to the extent caused by the negligent acts or omissions of the
Contractor, a Subcontractor, anyone directly or indirectly employed by them or
anyone for whose acts they may be liable, regardless of whether or not such
claim, damage, loss or expense is caused in part by a party indemnified
hereunder.  Such obligation shall not be
construed to negate, abridge, or reduce other rights or obligations of
indemnity which would otherwise exist as to a party or person described in this
Paragraph 3.18.

 

3.18.2      In claims against any
person or entity indemnified under this Paragraph 3.18 by an employee of the
Contractor, a Subcontractor, anyone directly or indirectly employed by them or
anyone for whose acts they may be liable, the indemnification obligation under
Subparagraph 3.18.1 shall not be limited by a limitation on amount or type of
damages, compensation or benefits payable by or for the Contractor or s
Subcontractor under workers’ compensation acts, disability benefit acts or
other employee benefit acts.

 

ARTICLE 4     ADMINISTRATION OF THE CONTRACT

4.1                                 ARCHITECT

4.1.1        The Architect is the
person lawfully licensed to practice architecture or an entity lawfully
practicing architecture identified as such in the Agreement and is referred to
throughout the Contract Documents as if singular in number.  The term “Architect” means the Architect or
the Architect’s authorized representative.

 

22

 

4.1.2        Duties,
responsibilities and limitations of authority of the Architect as set forth in
the Contract Documents shall not be restricted, modified or extended without
written consent of the Owner, Contractor and Architect.  Consent shall not be unreasonably withheld.

 

4.1.3        If the employment of
the Architect is terminated, the Owner shall employ a new Architect against
whom the Contractor has no reasonable objection and whose status under the
Contract Documents shall be that of the former Architect.

 

4.2                                 ARCHITECTS
ADMINISTRATION OF THE CONTRACT

4.2.1        The Architect will
provide administration of the Contractor as described in the Contract
Documents, and will be an Owner’s representative (1) during construction, (2)
until final payment is due and (3) with the Owner’s concurrence, from time to
time during the one-year period for correction of Work described in Paragraph
12.2.  The Architect will have authority
to act on behalf of the Owner only to the extent provided in the Contract
Documents, unless otherwise modified in writing in accordance with other
provisions of the Contract.

 

4.2.2        The Architect, as a
representative of the Owner, will visit the site at intervals appropriate to
the stage of the Contractor’s operations (1) to become generally familiar with
and to keep the Owner informed about the progress and quality of the portion of
the Work completed, (2) to endeavor to guard the Owner against defects and
deficiencies in the Work, and (3) to determine in general if the Work is being
performed in a manner indicating that the Work, when fully completed, will be
in accordance with the Contract Documents. 
However, the Architect will not be required to make exhaustive or
continuous on-site inspections to check the quantity or quantity of the
Work.  The Architect will neither have
control over or charge of, not be responsible for, the construction means,
methods, techniques, sequences or procedures, or for the safety precautions and
programs in connection with the Work, since these are solely the Contractor’s
rights and responsibilities under the Contract Documents, except as provided in
Subparagraph 3.3.1.

 

4.2.3        The Architect will
not be responsible for the Contractor’s failure to perform the Work in
accordance with the requirements of the Contract Documents.  The Architect will not have control over or
charge of and will not be responsible for acts or omissions of the Contractor,
Subcontractors, or their agents or employees, or any other persons or entities
performing portions of the Work.

 

4.2.4        Communications
Facilitating Contract Administration. 
Except as otherwise provided in the Contract Documents or when direct
communications have been specially authorized, the Owner and Contractor shall
endeavor to communicate with each other through the Architect about matters
arising out of or relating to the Contract. 
Communications by and with the Architect’s consultants shall be through
the Architect.  Communications by and
with Subcontractors and material suppliers shall be through the
Contractor.  Communications by and with
separate contractors shall be through the Owner.

 

4.2.5        Based on the Architect’s
evaluations of the Contractor’s Applications for Payment, the Architect will
review and certify the amounts due the Contractor and will issue Certificates
for Payment in such amounts.

 

4.2.6        The Architect will
have authority to reject Work that does not conform to the Contract
Documents.  Whenever the Architect
considers it necessary or advisable, the Architect will have authority to
require inspection or testing of the Work in accordance with Subparagraphs
3.5.2 and 13.5.3, whether or not such Work is fabricated, installed or
completed.  However, neither this
authority of the Architect nor a decision made in good faith either to exercise
or not to exercise such authority shall give rise to a duty or responsibility
of the

 

23

 

Architect to the Contractor, Subcontractors, material and equipment
suppliers, their agents or employees, or other persons or entities performing
portions of the Work.

 

4.2.7        The Architect will
review and approve or take other appropriate action upon the Contractor’s
submittals such as Shop Drawings, Product Data and Samples, but only for the
limited purpose of checking for conformance with information given and the
design concept expressed in the Contract Documents.  The Architect’s action will be taken with such reasonable
promptness as to cause no delay in the Work or in the activities of the Owner,
Contractor or separate contractors, while allowing sufficient time in the
Architect’s professional judgment to permit adequate review.  Review of such submittals is not conducted
for the purpose of determining the accuracy and completeness of other details
such as dimensions and quantities, or for substantiating instructions for
installation or performance of equipment or systems, all of which remain the
responsibility of the Contractor as required by the Contract Documents.  The Architect’s review of the Contractor’s
submittals shall not relieve the Contractor of the obligations under Paragraphs
3.3, 3.5 and 3.12.  The Architect’s review
shall not constitute approval of safety precautions or, unless otherwise
specifically stated by the Architect, of any construction means, methods,
techniques, sequences or procedures. 
The Architect’s approval of a specific item shall not indicate approval
of an assembly of which the item is a component.

 

4.2.8        The Architect will
prepare Change Orders and Construction Change Directives, and may authorize
minor changes in the Work as provided in Paragraph 7.4.

 

4.2.9        The Architect will
conduct inspections to determine the date or dates of Substantial Completion
and the date of final completion, will receive and forward to the Owner, for
the Owner’s review and records, written warranties and related documents
required by the Contract and assembled by the Contractor, and will issue a
final Certificate for Payment upon compliance with the requirements of the
Contract Documents.

 

4.2.10       If the Owner and Architect agree, the
Architect will provide one or more project representative to assist in carrying
out the Architect’s responsibilities at the site. The duties, responsibilities
and limitations of authority of the such project representative shall be as set
forth in an exhibit to be incorporated in the Contract Documents.

 

4.2.11      The Architect will
interpret and decide matters concerning performance under and requirements of
the Contract Documents on written request of either the Owner or
Contractor.  The Architect’s response to
such requests will be made in writing within any time limits agreed upon or
otherwise with reasonable promptness. 
If no agreement is made concerning the time within which interpretations
required of the Architect shall be furnished in compliance with this Paragraph
4.2, then delay shall not be recognized on account of failure by the Architect
to furnish such interpretations until 15 days after written request is made for
them.

 

4.2.12      Interpretations and
decisions of the Architect will be consistent with the intent of and reasonably
inferable from the Contract Documents and will be in writing or in the form of
drawings.  When making such
interpretations and initial decisions, the Architect will endeavor to secure
faithful performance by both Owner and Contractor, will not show partiality to
either and will not be liable for results of interpretations or decisions so
rendered in good faith.

 

4.2.13      The Architect’s
decisions on matters relating to aesthetic effect will be final if consistent
with the intent expressed in the Contract Documents.

 

4.3                                 CLAIMS AND DISPUTES

4.3.1        Definition.  A Claim is a demand or assertion by one of
the parties seeking, as a matter of right, adjustment or interpretation of
Contract terms, payment of money, extension of time or other relief with
respect to the terms of the Contract. 
The term “Claim” also includes

 

24

 

other disputes and matters in question between the Owner and Contractor
arising out of or relating to the Contract. 
Claims must be initiated by written notice.  The responsibility to substantiate Claims shall rest with the
party making the Claim.

 

4.3.2        Time Limits on
Claims.  Claims by either party must be
initiated within 21 days after occurrence of the event giving rise to such
Claim or within 21 days after the claimant first recognizes the condition
giving rise to the Claim, whichever is later. 
Claims must be initiated by written notice to the Architect and the
other party.

 

4.3.3        Continuing Contract
Performance.  Pending final resolution
of a Claim except as otherwise agreed in writing or as provided in Subparagraph
9.7.1 and Article 14, the Contractor shall proceed diligently with performance
of the Contract and the Owner shall continue to make payments in accordance
with the Contract Documents.

 

4.3.4        Claims for Concealed
or Unknown Conditions.  If conditions
are encountered at the site which are (1) subsurface or otherwise concealed
physical conditions which differ materially from those indicated in the
Contract Documents or (2) unknown physical conditions of an unusual nature,
which differ materially from those ordinarily found to exist and generally
recognized as inherent in construction activities of the character provided for
in the Contract Documents, then notice by the observing party shall be given to
the other party promptly before conditions are disturbed and in no event later
than 21 days after first observance of the conditions.  The Architect will promptly investigate such
conditions and, if they differ materially and cause an increase or decrease in
the Contractor’s cost of, or time required for, performance of any part of the
Work, will recommend an equitable adjustment in the Contract Sum or Contract
Time, or both.  If the Architect
determines that the conditions at the site are not materially different from
those indicated in the Contract Documents and that no change in the terms of
the Contract is justified, the Architect shall so notify the Owner and
Contractor in writing, stating the reasons. 
Claims by either party in opposition to such determination must be made
within 21 days after the Architect has given notice of the decision.  If the conditions encountered are materially
different, the Contract Sum and Contract Time shall be equitably adjusted, but
if the Owner and Contractor cannot agree on an adjustment in the Contract Sum or
Contract Time, the adjustment shall be referred to the Architect for initial
determination, subject to further proceedings pursuant to Paragraph 4.4.

 

4.3.5        Claims for Additional
Cost.  If the Contractor wishes to make
Claim for an increase in the Contract Sum, written notice as provided herein
shall be given before proceeding to execute the Work.  Prior notice is not required for Claims relating to an emergency
endangering life or property arising under Paragraph 10.6.

 

4.3.6        If the Contractor
believes additional cost is involved for reasons including but not limited to
(1) a written interpretation from the Architect, (2) an order by the Owner to
stop the Work where the Contractor was not at fault, (3) a written order for a
minor change in the Work issued by the Architect, (4) failure of payment by the
Owner, (5) termination of the Contract by the Owner, (6) Owner’s suspension or
(7) other reasonable grounds, Claim shall be filed in accordance with this
Paragraph 4.3.

 

4.3.7                        Claims for Additional Time

4.3.7.1     If the Contractor
wishes to make Claim for an increase in the Contract Time, written notice as
provided herein shall be given.  The
Contractor’s Claim shall include an estimate of cost and of probable effect of
delay on progress of the Work.  In the case
of a continuing delay only one Claim is necessary.

 

4.3.7.2     If adverse weather
conditions are the basis for a Claim for additional time, such Claim shall be
documented by data substantiating that weather conditions were abnormal for the

 

25

 

period of time, could not have been reasonably anticipated and had an
adverse effect on the scheduled constructions.

 

4.3.8        Injury or Damage to
Person or Property.  If either party to
the Contract suffers injury or damage to person or property because of an act
or omission of the other party, or of others for whose acts such party is
legally responsible, written notice of such injury or damage, whether or not
insured, shall be given to the other party within a reasonable time not
exceeding 21 days after discovery.  The
notice shall provide sufficient detail to enable the other party to investigate
the matter.

 

4.3.9        If unit prices are
stated in the Contract Documents or subsequently agreed upon, and if quantities
originally contemplated are materially changed in a proposed Change Order or
Construction Change Directive so that application of such unit prices to
quantities of Work proposed will cause substantial inequity to the Owner or
Contractor, the applicable unit prices shall be equitably adjusted.

 

4.3.10      Claims for
Consequential Damages.  The making of final payment by the Owner after its
acceptance of the Work shall constitute waiver of all Claims by the Contractor
and Owner except those arising from liens, claims, security interests or
encumbrances arising out of the Contract and unsettled; failure of the Work to
comply with the requirement of the Contract Documents; or the terms of special
warranties required by the Contract Documents.  The Contractor and Owner waive Claims
against each other for consequential damages arising out of or relating to this
Contract.  This mutual waiver includes:

 

.1               damages
incurred by the Owner for rental expenses, for losses of use, income, profit,
financing, business and reputation, and for loss of management or employee
productivity or of the services of such persons: and

.2               damage
incurred by the Contractor for principal office expenses including the
compensation of personnel stationed there, for losses of financing, business
and reputation and for loss of profit except anticipated profit arising
directly from the Work

 

This mutual waiver is applicable, without limitation, to all
consequential damages due to either party’s termination in accordance with
Article 14.  Nothing contained in this
Subparagraph 4.3.10 shall be deemed to preclude an award of liquidated direct
damages, when applicable, in accordance with the requirements of the Contract
Documents.

 

4.4                                 RESOLUTION OF CLAIMS
AND DISPUTES

4.4.1        Decision of
Architect. Claims, including those alleging an error or omission by the
Architect but excluding those arising under Paragraphs 10.3 through 10.5, shall
be referred initially to the Architect for decision. An initial decision by the
Architect shall be required as a condition precedent to mediation, arbitration
or litigation of all Claims between the Contractor and Owner arising prior to
the date final payment is due, unless 30 days have passed after the Claim has
been referred to the Architect with no decision having been rendered by the
Architect.  The Architect will not
decide disputes between the Contractor and persons or entities other than the
Owner.

 

4.4.2        The Architect will
review Claims and within ten days of the receipt of the Claim take one or more
of the following actions: (1) request additional supporting data from the
claimant or a response with supporting data from the other party, (2) reject
the Claim in whole or in part, (3) approve the Claim, (4) suggest a compromise,
or (5) advise the parties that the Architect is unable to resolve the Claim if
the Architect lacks sufficient information to evaluate

 

26

 

the merits of the Claim or if the Architect concludes that, in the
Architect’s sole discretion, it would be inappropriate for the Architect to
resolve the Claim.

 

4.4.3        In evaluating Claims,
the Architect may, but shall not be obligated to, consult with or seek
information from either party or from persons with special knowledge or
expertise who may assist the Architect in rendering a decision.  The Architect may request the Owner to
authorize retention of such persons at the Owner’s expense.

 

4.4.4        If the Architect
requests a party to provide a response to a Claim or to furnish additional
supporting data, such party shall respond, within ten days after receipt of
such request, and shall either provide a response on the requested supporting
data, advise the Architect when the response or supporting data will be
furnished or advise the Architect that no supporting data will be
furnished.  Upon receipt of the response
or supporting data, if any, the Architect will either reject or approve the
Claim in whole or in part.

 

4.4.5        The Architect will
approve or reject Claims by written decision, which shall state the reasons
therefor and which shall notify the parties of any change in the Contract Sum
or Contract Time or both.  The approval
or rejection of a Claim by the Architect shall be final and binding on the
parties but subject to mediation and arbitration.

 

4.4.6        When a written
decision of the Architect states that (1) the decision is final but subject to
mediation and arbitration and (2) a demand for arbitration of a Claim covered
by such decision must be made within 30 days after the date on which the party
making the demand receives the final written decision, then failure to demand
arbitration within said 30 days’ period shall result in the Architect’s
decision becoming final and binding upon the Owner and Contractor. If the
Architect renders a decision after arbitration proceedings have been initiated,
such decision may be entered as evidence, but shall not supersede arbitration
proceedings unless the decision is acceptable to all parties concerned.

 

4.4.7        Upon receipt of a
Claim against the Contractor or at any time thereafter, the Architect or the
Owner may, but is not obligated to, notify the surety, if any, of the nature
and amount of the Claim.  If the Claim
relates to a possibility of a Contractor’s default, the Architect or the Owner
may, but is not obligated to, notify the surety and request the surety’s
assistance in resolving the controversy.

 

4.4.8         If a claim relates to or is the subject
of a mechanic’s lien, the party asserting such Claim may proceed in accordance
with applicable law to comply with the lien notice or filing deadlines prior to
resolution of the Claim by the Architect, by mediation or by arbitration.

 

4.5                                 MEDIATION

4.5.1        Any Claim arising out
of or related to the Contract, except Claims relating to aesthetic effect and
except those waived as provided for in Subparagraphs 4.3.10, 9.10.4 and 9.10.5
shall, after initial decision by the Architect or 30 days after submission of
the Claim to the Architect, be subject to mediation as a condition precedent to
arbitration or the institution of legal or equitable proceedings by either
party.

 

4.5.2        The parties shall
endeavor to resolve their Claims by mediation which, unless the parties
mutually agree otherwise, shall be in accordance with the Construction Industry
Mediation Rules of the American Arbitration Association currently in
effect.  Request for mediation shall be
filed in writing with the other party to the Contract and with the American
Arbitration Association.  The request
may be made concurrently with the filing of a demand for arbitration but, in such
event, mediation shall proceed in advance of arbitration or legal or equitable
proceedings, which shall be stayed pending mediation for a period of 60 days
from the date of filing, unless stayed for a longer period by agreement of the
parties or court order.

 

27

 

4.5.3         The parties shall
share the mediator’s fee and any filing fees equally.  The mediation shall be held in the place where the Project is
located, unless another location is mutually agreed upon.  Agreements reached in mediation shall be
enforceable as settlement agreements in any court having jurisdiction thereof.

 

4.6                                 ARBITRATION

4.6.1        Any Claim arising out
of or related to the Contract, except Claims relating to aesthetic effect and
except those waived as provided for in Subparagraphs 4.3.10, 9.10.4 and 9.10.5,
shall, after decision by the Architect or 30 days after submission of the Claim
to the Architect, be subject to arbitration. 
Prior to arbitration, the parties shall endeavor to resolve disputes by
mediation in accordance with the provisions of Paragraph 4.5.

 

4.6.2        Claims not resolved
by mediation shall be decided by arbitration which, unless the parties mutually
agree otherwise, shall be in accordance with the Construction Industry Arbitration
Rules of the American Arbitration Association currently in effect.  The demand for arbitration shall be filed in
writing with the other party to the Contract and with the American Arbitration
Association, and copy shall be filed with the Architect.

 

4.6.3        A demand for
arbitration shall be made within the time limits specified in Subparagraphs
4.4.6 and 4.6.1 as applicable, and in other cases within a reasonable time
after the Claim has arisen, and in no event shall it be made after the date
when institution of legal or equitable proceedings based on such Claim would be
barred by the applicable statute of limitations as determined pursuant to
Paragraph 13.7.

 

4.6.4        Limitation on
Consolidation or Joinder.  No
arbitration arising out of or relating to the Contract shall include, by
consolidation or joinder or in any other manner, the Architect, the Architect’s
employees or consultants, except by written consent containing specific
reference to the Agreement and signed by the Architect, Owner, Contractor and
any other person or entity sought to be joined.  No arbitration shall include, by consolidation or joinder or in
any other manner, parties other than Owner, Contractor, a separate contractor
as described in Article 6 and other persons substantially involved in a common
question of fact or law whose presence is required if complete relief is to be
accorded in arbitration.  No person or
entity other than the Owner, Contractor or a separate contractor as described
in Article 6 shall be included as an original third party or additional third
party to an arbitration whose interest or responsibility is insubstantial.  Consent to arbitration involving an
additional person or entity shall not constitute consent to arbitration of a
Claim not described therein or with a person or entity not named or described
therein.  The foregoing agreement to
arbitrate and other agreements to arbitrate with an additional person or entity
duly consented to by parties to the Agreement shall be specifically enforceable
under applicable law in any court having jurisdiction thereof.

 

4.6.5        Claims and Timely
Assertion of Claims.  The party filing a
notice of demand for arbitration must assert in the demand all Claims then
known to that party on which arbitration is permitted to be demanded.

 

4.6.6        Judgment on Final
Award.  The award rendered by the
arbitrator or arbitrators shall be final, and judgment may be entered upon it
in accordance with applicable law in any court having jurisdiction thereof.

 

ARTICLE 5 SUBCONTRACTORS

5.1                                 DEFINITIONS

5.1.1        A Subcontractor is a
person or entity who has a direct contract with the Contractor to perform a
portion of the Work at the site.  The
term “Subcontractor” is referred to throughout the Contract Documents as if
singular in number and means a Subcontractor or an authorized

 

28

 

representative of the Subcontractor. 
The term “Subcontractor” does not include a separate contractor or
subcontractors of a separate contractor.

 

5.1.2        A Sub-subcontractor
is a person or entity who has a direct or indirect contract with a
Subcontractor to perform a portion of the Work at the site.  The term “Sub-subcontractor” is referred to
throughout the Contract Documents as if singular in number and means a
Sub-subcontractor or an authorized representative of the Sub-subcontractor.

 

5.2                                 AWARD OF SUBCONTRACTS
AND OTHER CONTRACTS FOR PORTIONS OF THE WORK

5.2.1        Unless otherwise
stated in the Contract Documents or the bidding requirements, the Contractor,
as soon as practicable after award of the Contract, shall furnish in writing to
the Owner through the Architect the names of person or entities (including
those who are to furnish materials or equipment fabricated to a special design)
proposed for each principal portion of the Work. The Architect will promptly
reply to the Contractor in writing stating whether or not the Owner or the
Architect, after due investigation, has reasonable objection to any such
proposed person or entity. Failure of the Owner or Architect to reply promptly
shall constitute notice of no reasonable objection.

 

5.2.2        The Contractor shall
not contract with a proposed person or entity to whom the Owner or Architect
has made reasonable and timely objection. 
The Contractor shall not6 be required to contract with anyone to whom
the Contractor has made reasonable objection.

 

5.2.3        If the Owner or
Architect has reasonable objection to a person or entity proposed by the
Contractor, the Contractor shall propose another to whom the Owner or Architect
has no reasonable objection.  If the
proposed but rejected Subcontractor was reasonably capable of performing the
Work, the Contract Sum and Contract Time shall be increased or decreased by the
difference, if any, occasioned by such change, and an appropriate Change Order
shall be issued before commencement of the substitute Subcontractor’s
Work.  However, no increase in the
Contract Sum or Contract Time shall be allowed for such change unless the
Contractor has acted promptly and responsively in submitting names as required.

 

5.2.4        The Contractor shall
not change a Subcontractor, person or entity previously selected if the Owner
or Architect makes reasonable objection to such substitute.

 

5.2.5       If
requested by the Owner the form of each subcontract shall be submitted to the
Owner for its approval, which shall not be unreasonably withheld or
delayed.  Each subcontract shall
expressly provide for the contingent assignment referred to in Subparagraph
5.4.1.

 

5.3                                 SUBCONTRACTUAL
RELATIONS

5.3.1        By appropriate
agreement, written where legally required for validity, the Contractor shall
require each Subcontractor, to the extent of the Work to be performed by the
Subcontractor, to be bound to the Contractor by terms of the Contract
Documents, and to assume toward the Contractor all the obligations and
responsibilities, including the responsibility for safety of the
Subcontractor’s Work, which the Contractor, by these Documents, assumes toward
the Owner and Architect.  Each
subcontract agreement shall preserve and protect the rights of the Owner and
Architect.  Each subcontract agreement
shall preserve and protect the rights of the Owner and Architect under the
Contract Documents with respect to the Work to be performed by the
Subcontractor so that subcontracting thereof will not prejudice such rights,
and shall allow to the Subcontractor, unless specifically provided otherwise in
the subcontract agreement, the benefit of all rights, remedies and redress
against the Contractor that the Contractor, by the Contract Documents, has against
the Owner.  Where

 

29

 

appropriate, the Contractor shall require each Subcontractor to enter
into similar agreements with Sub-subcontractors.  The Contractor shall make available to each proposed Subcontractor,
prior to the execution of the subcontract agreement, copies of the Contract
Documents to which the Subcontractor will be bound, and, upon written request
of the Subcontractor, identify to the Subcontractor terms and conditions of the
proposed subcontract agreement which may be at variance with the Contract
Documents.  Subcontractors will
similarly make copies of applicable portions of such documents available to
their respective proposed Sub-subcontractors.

 

5.4                                 CONTINGENT ASSIGNMENT
OF SUBCONTRACTS

5.4.1        Each subcontract
agreement for a portion of the Work is assigned by the Contractor to the Owner
provided that:

.1               assignment
is effective only after termination of the Contract by the Owner for cause
pursuant to Paragraph 14.2 and only for those subcontract agreements which the
Owner accepts by notifying the Subcontractor and Contractor in writing; and

.2               assignment
is subject to the prior rights of the surety, if any, obligated under bond
relating to the Contract.

 

5.4.2        Upon such assignment,
if the Work has been suspended for more than 30 days the Subcontractor’s
compensation shall be equitably adjusted for increases in cost resulting from
the suspension.

 

ARTICLE 6 CONSTRUCTION BY OWNER
OR BY SEPARATE CONTRACTORS

6.1                                 OWNERS RIGHT TO
PERFORM CONSTRUCTION AND TO AWARD SEPARATE CONTRACT

6.1.1        The Owner reserves
the right to perform construction or operations related to the Project with the
Owner’s own forces, and to award separate contracts in connection with other
portions of the Project or other constructions or operations on the site under
Conditions of the Contract identical or substantially similar to these
including those portions related to insurance and waiver of subrogation.  If the Contractor claims that delay or
additional cost is involved because of such action by the Owner, the Contractor
shall make such Claim as provided in Paragraph 4.3.

 

6.1.2        When separate
contracts are awarded for different portions of the Project or other
construction or operations on the site, the term “Contractor” in the Contract
Documents in each case shall mean the Contractor who executes each separate
Owner-Contractor Agreement.

 

6.1.3        The Owner shall
provide for coordination of the activities of the Owner’s own forces and of
each separate contractor with the Work of the Contractor, who shall cooperate
with them.  The Contractor shall
participate with other separate contractors and the Owner in reviewing their
construction schedules when directed to do so. 
The Contractor shall make any revisions to the construction schedule
deemed necessary after a joint review and mutual agreement.  The construction schedules shall then
constitute the schedules to be used by the Contractor, separate contractors and
the Other until subsequently revise.

 

6.1.4        Unless otherwise
provided in the Contract Documents, when the Owner performs construction or
operations related to the Project with the Owner’s own forces, the Owner shall
be deemed to be subject to the same obligations and to have the same rights
which apply to the Contractor under the Conditions of the Contract, including,
without excluding others, those stated in Articles 3, this Article 6 and
Articles 10, 11 and 12.

 

30

 

6.2                                 MUTUAL RESPONSIBILITY

6.2.1        The Contractor shall
afford the Owner and separate contractors reasonable opportunity for
introduction and storage of their materials and equipment and performance of
their activities, and shall connect and coordinate the Contractor’s
construction and operations with theirs as required by the Contract Documents.

 

6.2.2        If part of the
Contractor’s Work depends for proper execution or results upon construction or
operations by the Owner or a separate contractor, the Contractor shall, prior
to proceeding with that portion of the Work, promptly report to the Architect
apparent discrepancies or defects in such other construction that would render
it unsuitable for such proper execution and results.  Failure of the Contractor so to report shall constitute an
acknowledgement that the Owner’s or separate contractor’s completed or
partially completed construction is fit and proper to receive the Contractor’s
Work, except as to defects not then reasonably discoverable.

 

6.2.3        The Owner shall be
reimbursed by the Contractor for costs incurred by the Owner which are payable
to a separate contractor because of delays, improperly timed activities or
defective construction of the Contractor. 
The Owner shall be responsible to the Contractor for costs incurred by
the Contractor because of delays, improperly timed activities, damage to the
Work or defective construction of a separate contractor.

 

6.2.4        The Contractor shall
promptly remedy damage wrongfully caused by the Contractor to completed or
partially completed construction or to property of the Owner or separate
contractors as provided in Subparagraph 10.2.5.  If such separate contractor
sues or initiates mediation or an arbitration proceeding against the Owner on
account of any damage alleged to have been caused by the Contractor, the Owner
shall notify the Contractor who shall defend such proceedings at the Owner’s
expense and if any judgement or award against the Owner arises as a result of,
but only to the extent of, Contractor’s fault, the Contractor shall pay or
satisfy it and shall reimburse the Owner for all attorney’s fees, mediation
fees and costs, court fees and costs, and arbitration fees and costs which the
Owner has incurred.

 

6.2.5        The Owner and each
separate contractor shall have the same responsibilities for cutting and
patching as are described for the Contractor in Subparagraph 3.14.

 

6.3                                 OWNER’S RIGHT TO CLEAN
UP

6.3.1        If a dispute arises
among the Contractor, separate contractors and the Owner as to the
responsibility under their respective contracts for maintaining the premises and
surrounding area free from waste materials and rubbish, the Owner may clean up
and the Architect will allocate the cost among those responsible.

 

ARTICLE 7 CHANGES IN THE WORK

7.1.                              GENERAL

7.1.1        Changes in the Work
may be accomplished after execution of the Contract, and without invalidating
the Contract, by Change Order, Construction Change Directive or order for a
minor change in the Work, subject to the limitations stated in this Article 7
and elsewhere in the Contract Documents.

 

7.1.2        A Change Order shall
be based upon agreement among the Owner, Contractor and Architect; a
Construction Change Directive requires agreement by the Owner and Architect

 

31

 

and may or may not be agreed to by the Contractor, an order for a minor
change in the Work may be issued by the Architect alone.

 

7.1.3        Changes in the Work
shall be performed under applicable provisions of the Contract Documents, and
the Contractor shall proceed promptly, unless otherwise provided in the Change
Order, Construction Change Directive or order for a minor change in the Work.

 

7.2                                 CHANGE ORDERS

7.2.1        A Change Order is a
written instrument prepared by the Architect and signed by the Owner,
Contractor and Architect, stating their agreement upon all of the following:

 

.1               change
in the Work;

.2               the
amount of the adjustment, if any, in the Contract Sum; and

.3.            the
extent of the adjustment, if any, in the Contract Time.

 

7.2.2        Methods used in
determining adjustments to the Contract Sum may include those listed in 

Subparagraph 7.3.3.

 

7.3                                 CONSTRUCTION CHANGE
DIRECTIVES

7.3.1        A Construction Change
Directive is a written order prepared by the Architect and signed by the Owner
and Architect, directing a change in the Work prior to agreement on adjustment,
if any, in the Contract Sum or Contract Time, or both.  The Owner may by Construction Change
Directive, without invalidating the Contract, order changes in the Work within
the general scope of the Contract consisting of additions, deletions or other
revisions, the Contract Sum and Contract Time being adjusted accordingly.

 

7.3.2        A Construction Change
Directive shall be used in the absence of total agreement on the terms of a
Change Order.

 

7.3.3        If the Construction
Change Directive provides for an adjustment to the Contract Sum, the adjustment
shall be based on one of the following methods:

.1               mutual
acceptance of a lump sum properly itemized and supported by sufficient
substantiating data to permit evaluation;

.2               unit
prices stated in the Contract Documents or subsequently agreed upon;

.3               cost
to be determined in a manner agreed upon by the parties and a mutually
acceptable fixed or percentage fee; or

.4               as
provided in Subparagraph 7.3.6.

 

7.3.4        Upon receipt of a
Construction Change Directive, the Contractor shall promptly proceed with the
change in the Work involved and advise the Architect of the Contractor’s
agreement or disagreement with the method, if any, provided in the Construction
Change Directive for determining the proposed adjustment in the Contract Sum or
Contract Time.

 

7.3.5        A Construction Change
Directive signed by the Contractor indicates the agreement of the Contractor
therewith, including adjustment in Contract Sum and Contract Time or the method
for determining them.  Such agreement
shall be effective immediately and shall be recorded as a Change Order.

 

7.3.6        If the Contractor
does not respond promptly or disagrees with the method for adjustment in the
Contract Sum, the method and the adjustment shall be determined by the
Architect on the basis of reasonable expenditures and savings of those
performing the Work attributable to the change, including, in case of an
increase in the Contract Sum, a reasonable allowance for overhead and
profit.  In such case, and also under
Clause 7.3.3.3, the Contractor

 

32

 

shall keep and present, in such form as the Architect may prescribe, an
itemized accounting together with appropriate supporting data.  Unless otherwise provided in the Contract
Documents, costs for the purposes of this Subparagraph 7.3.6 shall be limited
to the following:

.1               costs
of labor, including social security, old age and unemployment insurance, fringe
benefits required by agreement or custom, and workers’ compensation insurance;

.2               costs
of materials, supplies and equipment, including cost of transportation, whether
incorporated or consumed;

.3               rental
costs of machinery and equipment, exclusive of hand tools, whether rented from
the Contractor or others;

.4               costs
of premiums for all bonds and insurance, permit fees, and sales, use or similar
taxes related to the Work; and

.5               additional
costs of supervision and field office personnel directly attributable to the
change.

 

7.3.7        The amount of credit
to be allowed by the Contractor to the Owner for a deletion or change which
results in a net decrease in the Contract Sum shall be actual net cost as
confirmed by the Architect.  When both
additions and credits covering related Work or substitutions are involved in a
change, the allowance for overhead and profit shall be figured on the basis of
net increase, if any, with respect to that change.

 

7.3.8        Pending final
determination of the total cost of a Construction Change Directive to the
Owner, amounts not in dispute for such changes in the Work shall be included in
Applications for Payment accompanied by a Change Order indicating the parties’
agreement with part or all of such costs. 
For any portion of such cost that remains in dispute, the Architect will
make an interim determination for purposes of monthly certification for payment
for those costs.  That determination of
cost shall adjust the Contract Sum on the same basis as a Change Order, subject
to the right of either party to disagree and assert a claim in accordance with
Article 4.

 

7.3.9        When the Owner and
Contractor agree with the determination made by the Architect concerning the
adjustments in the Contract Sum and Contract Time, or otherwise reach agreement
upon the adjustments, such agreement shall be effective immediately and shall be
recorded by preparation and execution of an appropriate Change Order.

 

7.4                                 MINOR CHANGES IN THE
WORK

7.4.1        The Architect will
have authority to order minor changes in the Work not involving adjustment in
the Contract Sum or extension of the Contract Time and not inconsistent with
the intent of the Contract Documents. Such changes shall be effected by written
order and shall be binding on the Owner and Contractor.  The Contractor shall carry out such written
orders promptly.

 

ARTICLE 8 TIME

8.1                                 DEFINITIONS

8.1.1        Unless otherwise
provided, Contract Time is the period of time, including authorized
adjustments, allotted in the Contract Documents for Substantial Completion of
the Work.

 

8.1.2        The date of
commencement of the Work is the date established in the Agreement.  The
date shall not be postponed by the failure to act by the Contractor or by
persons or entities for whom the Contractor is responsible.

 

33

 

8.1.3        The date of
Substantial Completion is the date certified by the Architect in accordance
with Paragraph 9.8.

 

8.1.4        The term “day” as
used in the Contract Documents shall mean calendar day unless otherwise
specifically defined.

 

8.2                                 PROGRESS AND
COMPLETION

8.2.1        Time limits stated in
the Contract Documents are of the essence of the Contract.  By executing the Agreement the Contractor
confirms that the Contract Time is a reasonable period for performing the Work.

 

8.2.2        The Contractor shall
not knowingly, except by agreement or instruction of the Owner in writing,
prematurely commence operations on the site or elsewhere prior to the effective
date of insurance required by Article 11 to be furnished by the Contractor and
Owner.  The date of commencement of the
Work shall not be changed by the effective date of such insurance.  Unless the date of commencement is
established by the Contract Documents or a notice to proceed given by the
Owner, the Contractor shall notify the Owner in writing not less than five days
or other agreed period before commencing the Work to permit the timely filing
of mortgages, mechanic’s liens and other security interests.

 

8.2.3        The Contractor shall
proceed expeditiously with adequate forces and shall achieve Substantial
Completion within the Contract Time.

 

8.3                                 DELAYS AND EXTENSIONS
OF TIME

8.3.1        If the Contractor is
delayed at any time in the commencement or progress of the Work by an act or
neglect of the Owner or Architect, or of an employee of either, or of a
separate contractor employed by the Owner, or by changes ordered in the Work,
or by labor disputes, fire, unusual delay in deliveries, unavoidable casualties
or other causes beyond the Contractor’s control, or by delay authorized by the
Owner pending mediation and arbitration, or by other causes which the Architect
determines may justify delay, then the Contract Time shall be extended by
Change Order for such reasonable time as the Architect may determine.

 

8.3.2        Claims relating to
time shall be made in accordance with applicable provisions of Paragraph 4.3.

 

8.3.3        This Paragraph 8.3
does not preclude recovery of damages for delay by either party under other
provisions of the Contract Documents. 
No claim for delay shall be allowed
on account of failure of the Architect to furnish Drawings, Specifications or
Instructions or to return Shop Drawings or Samples until five (5) days after
receipt by the Architect by registered or certified mail of written demand for
such Instructions, Drawings, or Samples, and not then unless such claim be
reasonable.

 

ARTICLE 9 PAYMENTS AND COMPLETION

9.1                                 CONTRACT SUM

9.1.1        The Contract Sum is
stated in the Agreement and, including authorized adjustments, is the total
amount payable by the Owner to the Contractor for performance of the Work under
the Contract Documents.

 

9.2                                 SCHEDULE OF VALUES

9.2.1        Before the first
application for Payment, the Contractor shall submit to the Architect a
schedule of values allocated to various portions of the Work, prepared in such
form and

 

34

 

supported by such data to substantiate its accuracy as the Architect
may require.  This schedule, unless
objected to by the Architect, shall be used as a basis for reviewing the
Contractor’s Applications for Payment.

 

9.3                                 APPLICATIONS FOR
PAYMENT

9.3.1        At least ten days
before the date established for each progress payment,  At the time or times established in the Contract,
the Contractor shall submit to the Architect an itemized Application for
Payment for operations completed in accordance with the schedule of
values.  The format and number of copies of such Applications for Payment shall be
as directed by the Owner, Such application shall be notarized,
if required, and supported by such data substantiating the Contractor’s right
to payment as the Owner or Architect may require, such as copies of
requisitions from Subcontractors and material suppliers, and reflecting
retainage if provided for in the Contract Documents.

 

9.3.1.1     As provided in
Subparagraph 7.3.8, such applications may include requests for payment on
account of changes in the Work which have been properly authorized by
Construction Change Directives, or by interim determinations of the Architect,
but not yet included in Change Orders.

 

9.3.1.2     Such applications may
not include requests for payment for portions of the Work for which the
Contractor does not intend to pay to a Subcontractor or material supplier,
unless such Work has been performed by others whom the Contractor intends to
pay.

 

9.3.2        Unless otherwise
provided in the Contract Documents, payments shall be made on account of
materials and equipment delivered and suitably stored at the site for
subsequent incorporation in the Work. 
If approved in advance by the Owner (including
such evidence of insurance and title as Owner shall request of Contractor
and/or Subcontractor), payment may similarly be made for
materials and equipment suitably stored off the site at a location agreed upon
in writing.  Payment for materials and
equipment stored on or off the site shall be conditioned upon compliance by the
Contractor with procedures satisfactory to the Owner to establish the Owner’s
title to such materials and equipment or otherwise protect the Owner’s
interest, and shall include the costs of applicable insurance, storage and
transportation to the site for such materials and equipment stored off the
site.

 

9.3.3        The Contractor
warrants that title to all Work covered by an Application for Payment will pass
to the  Owner either by Incorporation in the construction or upon
the receipt of payment by the Contractor, whichever occurs first, free and
clear from all liens, claims, security interests and encumbrances, hereinafter
referred to in this Article 9 as “liens”,  no later than the
time of payment.  The Contractor further
warrants that upon submittal of an Application for Payment. The Contractor
further warrants that upon submittal of an Application for Payment all work for
which Certificates for Payment have been previously issued and payments
received from the Owner shall, to the best of the Contractor’s Knowledge, information
and belief, be free and clear of liens, claims, security interests of
encumbrances in favor of the Contractor, Subcontractors, material suppliers, or
other persons or entities making a claim by reason of having provided labor,
materials and equipment relating to the Work.

 

9.3.4       Each
Application for Payment or periodic estimate requesting payment shall be
accompanied at the Owner’s option by: (i) a waiver of liens from each
subcontractor or; (ii) a certificate from each

 

35

 

Subcontractor stating that the Subcontractor
has been paid all amounts due the Subcontractor on the basis of the previous
periodic payment to the Contractor, or else stating the amount not so paid and
the reason for the discrepancy.  In the
event of such discrepancy, the Contractor shall furnish the Contractor’s own
written explanation to the Owner through the Architect. Such waiver or
certificate shall be in form acceptable to the Owner.

 

In the event that any lien security interest
chattel mortgage or conditional bill of sale shall be filed by any party
claiming by, through or under the Contractor, the Contractor shall promptly
remove or discharge such lien, security interest chattel mortgage or
conditional bill of sale by bonding payment, or otherwise provided that the
Owner has discharged its payment obligations to the Contractor relating to any
such lien and shall indemnify the Owner against the loss, damage or expenses
(including reasonable attorneys’ fees and expenses) caused by any such lien,
security interest, chattel mortgage or conditional bill of sale. If the
Contractor shall fail to so remove or discharge the same within five (5) days
after notice from the Owner (but in no event later than the date on which the
next payment on an Application for Payment becomes due) the Owner shall have
the right to remove or discharge the same by bonding payment or otherwise for
the account of the Contractor and the amount of any payment, cost and expenses
made or incurred by the Owner in connection with the removal or discharge thereof
may be withheld from any payment thereafter becoming due or shall be reimbursed
promptly to the Owner by the Contractor.

 

9.4                                 CERTIFICATES FOR
PAYMENT

9.4.1        The Architect will,
within seven days after receipt of the Contractor’s Application for Payment,
either issue to the Owner a Certificate for Payment, with a copy to the
Contractor, for such amount as the Architect determines is properly due, or
notify the Contractor and Owner in writing of the Architect’s reasons for
withholding certification in whole or in part as provided in Subparagraph
9.5.1.

 

9.4.2        The issuance of a
Certificate for Payment will constitute a representation by the Architect to
the Owner, based on the Architect’s evaluation of the Work and the data
comprising the Application for Payment, that the Work has progressed to the
point indicated and that, to the best of the Architect’s knowledge, information
and belief, the quality of the Work is in accordance with the Contract
Documents.  The foregoing
representations are subject to an evaluation of the Work for conformance with
the Contract Documents upon Substantial Completion, to results of subsequent
tests and inspections, to correction of minor deviations from the Contract
Documents prior to completion and to specific qualification expressed by the
Architect.  The issuance of a
Certificate for Payment will further constitute a representation that the
Contractor is entitled to payment in the amount certified.  However, the issuance of a

 

36

 

Certificate for Payment will not be a representation that the Architect
has (1) made exhaustive or continuous on-site inspections to check the quality
or quantity of the Work, (2) reviewed construction means, methods, techniques,
sequences or procedures, (3) reviewed copies of requisitions received from
Subcontractors and material suppliers and other data requested by the Owner to
substantiate the Contractor’s right to payment, or (4) made examination to ascertain
how or for what purpose the Contractor has used money previously paid on
account of the Contract Sum.

 

9.5                                 DECISIONS TO WITHHOLD
CERTIFICATION

9.5.1        The Architect may
withhold a Certificate for Payment in whole or in part, to the extent
reasonably necessary to protect the Owner, if in the Architect’s opinion the
representations to the Owner required by Subparagraph 9.4.2 cannot be
made.  If the Architect is unable to
certify payment in the amount of the Application, the Architect will notify the
Contractor and Owner as provided in Subparagraph 9.4.1.  If the Contractor and Architect cannot agree
on a revised amount, the Architect will promptly issue a Certificate for
Payment for the amount for which the Architect is able to make such
representations to the Owner.  The
Architect may also withhold a Certificate for Payment or, because of
subsequently discovered evidence, may nullify the whole or a part of a
Certificate for Payment previously issued, to such extent as may be necessary
in the Architect’s opinion to protect the Owner from loss for which the
Contractor is responsible, including loss resulting from acts and omissions
described in Subparagraph 3.3.2, because of:

.1               defective
Work not remedied;

.2               third
party claims filed or reasonable evidence indicating probable filing of such
claims unless security acceptable to the Owner is provided by the Contractor;

.3               failure
of the Contractor to make payments properly to Subcontractors or for labor,
materials or equipment;

.4               reasonable
evidence that the Work cannot be completed for the unpaid balance of the
Contract Sum;

.5               damage
to the Owner or another contractor;

.6               reasonable
evidence that the Work will not be completed within the Contract Time, and that
the unpaid balance would not be adequate to cover actual or liquidated damages
for the anticipated delay; or

.7               persistent
failure to carry out the Work in accordance with the Contract Documents.

 

.8              A lien or attachment
is filed in violation of this Agreement.

 

9.5.2        When the above
reasons for withholding certification are removed, certification will be made
for amounts previously withheld.

 

9.6                                 PROGRESS PAYMENTS

9.6.1        After the Architect
has issued a Certificate for Payment, the Owner shall make payment in the
manner and within the time provided in the Contract Documents, and shall so
notify the Architect.

 

9.6.2        The Contractor shall
promptly pay each Subcontractor, upon receipt of payment from the Owner, out of
the amount paid to the Contractor on account of such Subcontractor’s portion of
the Work, the amount to which said Subcontractor is entitled, reflecting
percentages actually retained from payments to the Contractor on account of
such Subcontractor’s portion of the Work. 
The Contractor shall, by appropriate agreement with each Subcontractor,
require each Subcontractor to make payments to Sub-subcontractors in a similar
manner.

 

9.6.3        The Architect
will, on request, furnish to a Subcontractor, if practicable, information
regarding percentages of completion or amounts applied for by the Contractor and
action

 

37

 

taken thereon by the Architect and Owner on account of portions of the
Work done by such Subcontractor.

 

9.6.4        Neither the Owner nor
Architect shall have an obligation to pay or to see to the payment of money to
a Subcontractor Sub-subcontractor of
material supplier, except as may otherwise be required by law.

 

9.6.5        Payment to material
suppliers shall be treated in a manner similar to that provided in
Subparagraphs 9.6.2, 9.6.3 and 9.6.4.

 

9.6.6        A Certificate for
Payment, a progress payment, or partial or entire use or occupancy of the
Project by the Owner shall not constitute acceptance of Work not in accordance
with the Contract Documents.

 

9.6.7        Unless the Contractor
provides the Owner with a payment bond in the full penal sum of the Contract
Sum, payments received by the Contractor for Work properly performed by
Subcontractors and suppliers shall be held by the Contractor for those
Subcontractors or suppliers who performed Work or furnished materials, or both,
under contract with the Contractor for which payment was made by the
Owner.  Nothing contained herein
shall require money to be placed in a separate account and not commingled with
money of the Contractor, shall create any fiduciary liability or tort liability
on the part of the Contractor for breach of trust or shall entitle any person
or entity to an award of punitive damages against the Contractor for breach of
the requirements of this provision.

 

9.7                                 FAILURE OF PAYMENT

9.7.1        If the Architect does
not issue a Certificate for Payment, through no fault of the Contractor, within
seven days after receipt of the Contractor’s Application for Payment, or if the
Owner does not pay the Contractor within seven days after the date established
in the Contract Documents the amount certified by the Architect or awarded
by arbitration,  then the Contractor may, upon seven
additional days’ written notice to the Owner and Architect, stop the Work until
payment of the amount owing has been received. 
The Contract Time shall be extended appropriately and the Contract Sum
shall be increased by the amount of the Contractor’s reasonable costs of
shut-down, delay and start-up, plus interest as provided for in the Contract
Documents.

 

9.8                                 SUBSTANTIAL COMPLETION

9.8.1        Substantial
Completion is the stage in the progress of the Work when the Work or designated
portion thereof is sufficiently complete in accordance with the Contract
Documents so that the Owner can occupy or utilize the Work for its intended use
and only minor items which can be
corrected or completed without any material Interference with the Owner’s use
of the Work remain to be corrected or completed.

 

9.8.2        When the Contractor
considers that the Work, or a portion thereof which the Owner agrees to accept
separately, is substantially complete, the Contractor shall prepare and submit
to the Architect a comprehensive list of items to be completed or corrected
prior to final payment.  Failure to
include an item on such list does not alter the responsibility of the
Contractor to complete all Work in accordance with the Contract Documents.

 

9.8.3        Upon receipt of the
Contractor’s list, the Architect will make an inspection to determine whether
the Work or designated portion thereof is substantially complete.  If the Architect’s inspection discloses any
item, whether or not included on the Contractor’s list, which is not
sufficiently complete in accordance with the Contract Documents so that the

 

38

 

Owner can occupy or utilize the Work or designated portion thereof for
its intended use, the Contractor shall, before issuance of the Certificate of
Substantial Completion, complete or correct such item upon notification by the
Architect.  In such case, the Contractor
shall then submit a request for another inspection by the Architect to
determine Substantial Completion.

 

9.8.4        When the Work or
designated portion thereof is substantially complete, the Architect will
prepare a Certificate of Substantial Completion which shall establish the date
of Substantial Completion, shall establish responsibilities of the Owner and
Contractor for security, maintenance, heat, utilities, damage to the Work and
insurance, and shall fix the time within which the Contractor shall finish all
items on the list accompanying the Certificate.  Warranties required by the Contract Documents shall commence on
the date of Substantial Completion of the Work or designated portion thereof
unless otherwise provided in the Certificate of Substantial Completion.

 

9.8.5        The Certificate of
Substantial Completion shall be submitted to the Owner and Contractor for their
written acceptance of responsibilities assigned to them in such
Certificate.  Upon such acceptance and
consent of surety, if any, the Owner shall make payment of retainage applying
to such Work or designated portion thereof. Such payment shall be adjusted for
Work that is incomplete or not in accordance with the requirements of the
Contract Documents.

 

9.9                                 PARTIAL OCCUPANCY OR
USE

9.9.1        The Owner may occupy
or use any completed or partially completed portion of the Work at any stage when
such portion is designated by separate agreement with the Contractor, provided
such occupancy or use is consented to by the insurer as required under Clause 11.4.1.5
and authorized public authorities by having jurisdiction over the Work.  Such partial occupancy or use may commence
begin   whether or not the portion is substantially
complete, provided that  the
respective responsibilities of the Owner and Contractor with respect to  have accepted
in writing the responsibilities assigned to each of them for payments,
retainage, if any, security, maintenance, heat, utilities, damage to the Work,
insurance, correction of the Work and
warranties shall be established by agreement of the Owner and Contractor or,
absent such agreement shall be determined by the Architect subject to the right
of either party to contest such determination as provided in Paragraph 4.5.and have agreed in writing, concerning the period for correction of the
Work and commencement of warranties required by the Contract Documents.  When the Contractor considers a portion
substantially complete, the Contractor shall prepare and submit a list to the
Architect as provided under Subparagraph 9.8.2.  Consent of the Contractor to partial occupancy or use shall not
be unreasonably withheld.  The stage of
the progress of the Work shall be determined by written agreement between the
Owner and Contractor or, if no agreement is reached, by decision of the Architect.

 

9.9.2        Immediately prior to
such partial occupancy or use, the Owner, Contractor and Architect shall
jointly inspect the area to be occupied or portion of the Work to be use in
order to determine and record the condition of the Work.

 

9.9.3        Unless otherwise
agreed upon, partial occupancy or use of a portion or portions of the Work
shall not constitute acceptance of Work not complying with the requirements of
the Contract Documents.

 

39

 

9.10                           FINAL COMPLETION AND FINAL
PAYMENT

9.10.1      Upon receipt of
written notice that the Work is ready for final inspection and acceptance and
upon receipt of a final Application for Payment, the Architect will promptly
make such inspection and, when the Architect finds the Work acceptable under
the Contract Documents and the Contract fully performed, the Architect will
promptly issue a final Certificate for Payment stating that to the best of the
Architect’s knowledge, information and belief, and on the basis of the Architect’s
on-site visits and inspections, the Work has been completed in accordance with
terms and conditions of the Contract Documents and that the entire balance
found to be due the Contractor and noted in the final Certificate is due and
payable.  The Architect’s final
Certificate for Payment will constitute a further representation that
conditions listed in Subparagraph 9.10.2 as precedent to the Contractor’s being
entitled to final payment have been fulfilled.

 

9.10.2      Neither final payment
nor any remaining retained percentage shall become due until the Contractor
submits to the Architect (1) an affidavit that payrolls, bills for materials
and equipment, and other indebtedness connected with the Work for which the
Owner or the Owner’s property might be responsible or encumbered (less amounts
withheld by Owner) have been paid or otherwise satisfied, (2) a certificate
evidencing that insurance required by the Contract Documents to remain in force
after final payment is currently in effect and will not be canceled or allowed
to expire until at least 30 days’ prior written notice has been given to the
Owner, (3) a written statement that the Contractor knows of no substantial
reason that the insurance will not be renewable to cover the period required by
the Contract Documents, (4) consent of surety, if any, to final payment and (5)
if required by the Owner, other data establishing payment or satisfaction of
obligations, such as receipts, releases and waivers of liens, claims, security
interests or encumbrances arising out of the Contract, to the extent and in
such form as may be designated by the Owner. 
If a Subcontractor refuses to furnish a release or waiver required by
the Owner, the Contractor may furnish a bond satisfactory to the Owner to
indemnify the Owner against such lien. Provided
Owner is not in breach of its payment obligations under the Contract, If the
Contractor fails to furnish such releases or waivers as the Owner reasonably
requires to satisfy the Owner that there are no outstanding liens, the Owner
may require the Contractor as a condition of final payment and at the
Contractor’s expense to furnish a bond satisfactory to the Owner to Indemnify
the Owner against any such liens.  If such lien remains unsatisfied after payments are made, the
Contractor shall refund to the Owner all money that the Owner may be compelled
to pay in discharging such lien, including all costs and reasonable attorneys’
fees.

 

9.10.3      If, after Substantial
Completion of the Work, final completion thereof is materially delayed through
no fault of the Contractor or by issuance of Change Orders affecting final
completion, and the Architect so confirms, the Owner shall, upon application by
the Contractor and certification by the Architect, and without terminating the
Contract, make payment of the balance due for that portion  of the Work fully completed and
accepted.  If the remaining balance for
Work not fully completed or corrected is less than retainage stipulated in the
Contract Documents, and if bonds have been furnished, the written consent of
surety to payment of the balance due for that portion of the Work fully
completed and accepted shall be submitted by the Contractor to the Architect
prior to certification of such payment. 
Such payment shall be made under terms and conditions governing final
payment, except that it shall not constitute a waiver of claims.

 

9.10.4      The making of final
payment shall constitute a waiver of Claims by the Owner except those arising
from:

.1               liens,
Claims, security interests or encumbrances arising out of the Contract and
unsettled;

 

40

 

.2               failure
of the Work to comply with the requirements of the Contract Documents;

or

.3               terms
of special warranties required by the Contract Documents.

 

9.10.5      Acceptance of final
payment by the Contractor, a Subcontractor or material supplier shall
constitute a waiver of claims by that payee except those previously made in
writing and identified by that payee as unsettled at the time of final
Application for Payment.

 

ARTICLE 10 PROTECTION OF
PERSONS AND PROPERTY

10.1                           SAFETY PRECAUTIONS AND
PROGRAMS

10.1.1      The Contractor shall
be responsible for initiating, maintaining and supervising all safety
precautions and programs in connection with the performance of the Contract.

 

10.2                           SAFETY OF PERSONS AND
PROPERTY

10.2.1      The Contractor shall
take reasonable precautions for safety of, and shall provide reasonable
protection to prevent damage, injury or loss to:

.1               employees
on the Work and other persons who may be affected thereby;

.2               the
Work and materials and equipment to be incorporated therein, whether in storage
on or off the site, under care, custody or control of the Contractor or the
Contractor’s Subcontractors or Sub-subcontractors; and

.3               other
property at the site or adjacent thereto, such as trees, shrubs, lawns, walks,
pavements, roadways, structures and utilities not designated for removal,
relocation or replacement in the course of construction.

 

10.2.2      The Contractor shall
give notices and comply with applicable laws, ordinances, rules, regulations
and lawful orders of public authorities bearing on safety of persons or
property or their protection from damage, injury or loss.

 

10.2.3      The Contractor shall
erect and maintain, as required by existing conditions and performance of the
Contract, reasonable safeguards for safety and protection, including posting
danger signs and other warnings against hazards, promulgating safety
regulations and notifying owners and users of adjacent sites and utilities.

 

10.2.4      When use or storage of
explosives or other hazardous materials or equipment or unusual methods are
necessary for execution of the Work, the Contractor shall exercise utmost care
and carry on such activities under supervision of properly qualified personnel.

 

10.2.5      The Contractor shall
promptly remedy damage and loss (other than damage or loss insured under
property insurance required by the Contract Documents) to property referred to
in Clause 10.2.1.2 and 10.2.1.3 caused in whole or in part by the Contractor, a
Subcontractor, a Sub-subcontractor, or anyone directly or indirectly employed
by any of them, or by anyone for whose acts they may be liable and for which
the Contractor is responsible under Clauses 10.2.1.2 and 10.2.1.3, except
damage or loss attributable to acts or omissions of the Owner or Architect or
anyone directly or indirectly employed by either of them, or by anyone for
whose acts either of them may be liable, and not attributable to the fault or
negligence of the Contractor. The foregoing obligations of the Contractor are
in addition to the Contractor’s obligations under Paragraph 3.18.

 

10.2.6      The Contractor shall
designate a responsible member of the Contractor’s organization at the site
whose duty shall be the prevention of accidents. This person shall be the
Contractor’s superintendent unless otherwise designated by the Contractor in
writing to the Owner and Architect.

 

41

 

10.2.7      The Contractor shall
not load or permit any part of the construction or site to be loaded so as to
endanger its safety.

 

10.3                           HAZARDOUS MATERIALS

10.3.1      If reasonable
precautions will be inadequate to prevent foreseeable bodily injury or death to
persons resulting from a material or substance, including but not limited to
asbestos or polychlorinated biphenyl (PCB), encountered on the site by the
Contractor, the Contractor shall, upon recognizing the condition, immediately
stop Work in the affected area and report the condition to the Owner and
Architect in writing.

 

10.3.2      The Owner shall obtain
the services of a licensed laboratory to verify the presence or absence of the
material or substance reported by the Contractor and, in the event such
material or substance is found to be present, to verify that it has been rendered
harmless.  Unless otherwise required by
the Contract Documents, the Owner shall furnish in writing to the Contractor
and Architect the names and qualifications of persons or entities who are to
perform tests verifying the presence or absence of such material or substance
or who are to perform the task of removal or safe containment of such material
or substance.  The Contractor and the
Architect will promptly reply to the Owner in writing stating whether or not either
has reasonable objection to the persons or entities proposed by the Owner. If
either the Contractor or Architect has an Objection to a persons or entity
proposed by the Owned, the Owner shall proposed another to whom the Contractor
and the Architect have no reasonable objection.  When the material or substance has been rendered harmless, Work
in the affected area shall resume upon written agreement of the Owner and
Contractor.  The Contract Time shall be
extended appropriately and the Contract Sum shall be increased in the amount of
the Contractor’s reasonable additional costs of shut-down, delay and start-up,
which adjustments shall be accomplished as provided in Article 7.

 

10.3.3      To the fullest extent
permitted by law, the Owner shall indemnify and hold harmless the Contractor,
Subcontractors, Architect, Architect’s consultants and agents and employees of
any of them from and against claims, damages, losses and expenses, including
but not limited to attorneys’ fees, arising out of or resulting from
performance of the Work in the affected area if in fact the material or
substance presents the risk of bodily injury or death as described in
Subparagraph 10.3.1 and has not been rendered harmless, provided that such
claim, damage, loss or expense is attributable to bodily injury, sickness, disease
or death, or to injury to or destruction of tangible property (other than the
Work itself) and provided that such damage, loss or expense is not due to the
sole negligence of a party seeking indemnity.

 

10.4         The Owner shall not
be responsible under Paragraph 10.3 for materials and substances brought to the
site by the Contractor unless such materials or substances were required by the
Contract Documents.

 

10.5         If, without
negligence on the part of the Contractor, the Contractor is held liable for the
cost of remediation of a hazardous material or substance solely by reason of
performing Work as required by the Contract Documents, the Owner shall
indemnify the Contractor for all cost and expense thereby incurred.

 

10.6                           EMERGENCIES

10.6.1      In an emergency affecting
safety of persons or property, the Contractor shall act, at the Contractor’s
discretion, to prevent threatened damage, injury or loss. Additional
compensation or extension of time claimed by the Contractor on account of an
emergency shall be determined as provide in Paragraph 4.3 and Article 7.

 

42

 

ARTICLE 11 INSURANCE AND BONDS

11.1                           CONTRACTOR’S LIABILITY
INSURANCE

11.1.1      The Contractor shall
purchase from and maintain in a company or companies lawfully authorized to do
business in the jurisdiction in which the Project is located such insurance as
will protect the Contractor from claims set forth below which may arise out of
or result from the Contractor’s operations under the Contract and for which the
Contractor may be legally liable, whether such operations be by the Contractor
or by a Subcontractor or by anyone directly or indirectly employed by any of
them, or by anyone for whose acts any of them may be liable:

.1               claims
under workers’ compensation, disability benefit and other similar employee
benefit acts which are applicable to the Work to be performed;

.2               claims
for damages because of bodily injury, occupational sickness or disease, or
death of the Contractor’s employees;

.3               claims
for damages because of bodily injury, sickness or disease, or death of any
person other than the Contractor’s employees;

.4               claims
for damages insured by usual personal injury liability coverage;

.5               claims
for damages, other than to the Work itself, because of injury to or destruction
of tangible property, including loss of use resulting there  from;

.6               claims
for damages because of bodily injury, death of a person or property damage
arising out of ownership, maintenance or use of a motor vehicle;

.7               claims
for bodily injury or property damage arising out of completed operations; and

.8               claims
involving contractual liability insurance applicable to the Contractor’s
obligations under Paragraph 3.18.

 

11.1.2      The insurance required
by Subparagraph 11.1.1 shall be  written for not less than limits of
liability specified in the Contract Documents or required by law, whichever
coverage is greater, Coverages, whether written on an occurrence or claims made
basis, shall be maintained without interruption from date of commencement of
the Work until date of final payment and termination of any coverage required
to be maintained after final payment.  include
all major divisions of coverage, and shall be on a comprehensive general basis
including Premises and Operations (including X-C-U). Owner’s and Contractor’s
Protective, Products and Completed Operations, and Owner non-owned, and Hired
Motor Vehicles. Such insurance shall be written for not less than any limits of
liability required by law or those set forth in the Contract Documents,
whichever is greater.

 

All insurance shall be written on an
occurrence basis, unless the Owner approves in writing coverage on a
claims-made basis.  Coverages, whether
written on an occurrence or claims-made basis, shall be maintained maintained
without interruption from date of commencement of the Work until date of final
payment and termination of any coverage required to be maintained after final
payment.  The Owner, Architect,
Architect’s consultants and their respective officers, employees, partners,
directors, shareholders, agents, successors and assigns shall be added as an
Additional Insureds on all policies.

 

43

 

The insurance afforded by this policy is
primary insurance except when stated to apply in excess of or contingent upon
the absence of other insurance.  When
this insurance is primary, and the Insured has other insurance which is stated
to be applicable to the loss on an excess or contingent basis the amount of the
company’s liability under this policy shall not be reduced by the existence of
such other Insurance.

 

11.1.3      Certificates of
insurance acceptable to the Owner shall be filed with the Owner prior to
commencement of the Work.  These
certificates and the insurance policies required by this Paragraph 11.1 shall
contain a provision that coverages afforded under the policies will not be
canceled or allowed to expire until at least 30 days’ prior written notice has
been given to the Owner.  These certificates shall set forth evidence of all
coverage required by 11.1.1 and 11.1.2. The form of certificate shall be
substantially similar to AIA Document G715. 
Certificates to be delivered shall name the Owner, Architect.
Architect’s consultants and their respective officers, employees, partners,
directors, shareholders, agents, successors and assigns as Additional insureds
on all policies, and the following additional insured:

 

Delaware North Companies Incorporated,
Its  employees, officers, partners,
directors, shareholders, agents, successors, and assigns 

40 Fountain Plaza, Buffalo, New York 14202

The Contractor shall furnish to the Owner
copies of any endorsements that are subsequently issued amending limits of
coverage. 
If any of the foregoing insurance coverages are required to remain in force
after final payment and are reasonably available, an additional certificate
evidencing continuation of such coverage shall be submitted with the final
Application for Payment as required by Subparagraph 9.10.2.  Information concerning reduction of coverage
on account of revised limits or claims paid under the General Aggregate, or
both, shall be furnished by the Contractor with reasonable promptness in
accordance with the Contractor’s information and belief.

 

11.2                           OWNER’S LIABILITY INSURANCE

11.2.1      The Owner shall be
responsible for purchasing and maintaining the Owner’s usual liability
insurance.

 

11.3                           PROJECT MANAGEMENT
PROTECTIVE LIABILITY INSURANCE

11.3.1      Optionally, the Owner
may require the Contractor to purchase and maintain Project Management Protective
Liability insurance from the Contractor’s usual sources as primary coverage for
the Owner’s, Contractor’s and Architect’s vicarious liability for construction
operations under the Contract.  Unless
otherwise required by the Contract Documents, the Owner shall reimburse the
Contractor by increasing the Contract Sum to pay the cost of purchasing and
maintaining such optional insurance coverage, and the Contractor shall not be
responsible for purchasing any other liability insurance on behalf of the Owner.  The minimum limits of liability purchased
with such coverage shall be equal to the aggregate of the limits required for
Contractor’s Liability Insurance under Clauses 11.1.1.2 through 11.1.1.5.

 

44

 

11.3.2      To the extent damages
are covered by Project Management Protective Liability insurance, the Owner,
Contractor and Architect waive all rights against each other for damages,
except such rights as they may have to the proceeds of such insurance.  The policy shall provide for such waivers of
subrogation by endorsement or otherwise.

 

11.3.3      The Owner shall not
required the Contractor to include the Owner, Architect or other persons or
entities as additional insureds on the Contractor’s Liability Insurance
coverage under Paragraph 11.1.

 

11.4                           PROPERTY INSURANCE

11.4.1      Unless otherwise
provided, the Owner shall purchase and maintain, in a company or companies
lawfully authorized to do business in the jurisdiction in which the Project is
located, property insurance written on a builder’s risk “all-risk” or
equivalent policy form in the amount of the initial Contract Sum, plus value of
subsequent Contract modifications and cost of materials supplied or installed
by others, comprising total value for the entire Project at the site on a
replacement cost basis without optional deductibles.  Such property insurance shall be maintained, unless otherwise
provided in the Contract Documents or otherwise agreed in writing by all persons
and entities who are beneficiaries of such insurance, until final payment has
been made as provided in Paragraph 9.10 or until no person or entity other than
the Owner has an insurable interest in the property required by this Paragraph
11.4 to be covered, whichever is later. 
This insurance shall include interests of the Owner, the Contractor,
Subcontractors and Sub-subcontractors in the Project.

 

11.4.1.1   Property insurance
shall be on an “all-risk” or equivalent policy form and shall include, without
limitation, insurance against the perils of fire (with extended coverage) and
physical loss or damage including, without duplication of coverage, theft,
vandalism, malicious mischief, collapse, earthquake, flood, windstorm,
falsework, testing and startup, temporary buildings and debris removal
including demolition occasioned by enforcement of any applicable legal
requirements, and shall cover reasonable compensation for Architect’s and
Contractor’s services and expenses required as a result of such insured loss.

 

11.4.1.2   If the Owner does not
intend to purchase such property insurance required by the Contract and with
all of the coverages in the amount described above, the Owner shall be inform
the Contractor in writing prior to commencement of the Work.  The Contractor may then effect insurance
which will protect the interests of the Contractor, Subcontractors and
Sub-subcontractors in the Work, and by appropriate Change Order the cost
thereof shall be charged to the Owner. 
If the Contractor is damaged by the failure or neglect of the Owner to
purchase or maintain insurance as described above, without so notifying the
Contractor in writing, then the Owner shall bear all reasonable costs property
attributable thereto. If the property
insurance requires minimum deductibles and such deductibles are identified in
the Contract Documents, the Contractor shall pay insurance required minimum
deductibles and such deductibles are identified in the Contract Documents, the
Contractor shall pay costs not covered because of such deductibles.  If the Owner or insurer increases the
required minimum deductibles above the amount so identified or if the Owner
elects to purchase this insurance with voluntary deductible amounts, the Owner
shall be responsible for payment of the additional costs not covered because of
such increased or voluntary deductibles.

 

45

 

11.4.1.3   If the property
insurance requires deductibles, the Owner shall pay costs not covered because
of such deductibles.

 

11.4.1.4   This property insurance
shall cover portions of the Work stored off the site, and also portions of the
Work in transit.

 

11.4.1.5   Partial occupancy or
use in accordance with Paragraph 9.9 shall not commence until the insurance
company or companies providing property insurance have consented to such
partial occupancy or use by endorsement or otherwise.  The Owner and the Contractor shall take reasonable steps to
obtain consent of the insurance company or companies and shall, without mutual
written consent, take no action with respect to partial occupancy or use that
would cause cancellation, lapse or reduction of insurance.

 

11.4.2      Boiler and Machinery
Insurance.  The Owner shall purchase and
maintain boiler and machinery insurance required by the Contract Documents or
by law, which shall specifically cover such insured objects during installation
and until final acceptance by the Owner; this insurance shall include interests
of the Owner, Contractor, Subcontractors and Sub-subcontractors in the Work,
and the Owner and Contractor shall be named insureds.

 

11.4.3      Loss of Use
Insurance.  The Owner, at the Owner’s
option, may purchase and maintain such insurance as will insure the Owner
against loss of use of the Owner’s property due to fire or other hazards,
however caused.  The Owner waives all
rights of action against the Contractor for loss of use-of the Owner’s
property, including consequential losses due to fire or other hazards however
caused.

 

11.4.4      If the Contractor
requests in writing that insurance for risks other than those described herein
or other special causes of loss be included in the property insurance policy,
the Owner shall, if possible, include such insurance, and the cost thereof
shall be charged to the Contractor by appropriate Change Order.

 

11.4.5      If during the Project
construction period the Owner insures properties, real or personal or both, at
or adjacent to the site by property insurance under policies separate from
those insuring the Project, or if after final payment property insurance is to
be provided on the completed Project through a policy or policies other than
those insuring the Project during the construction period, the Owner shall
waive all rights in accordance with the terms of Subparagraph 11.4.7 for
damages caused by fire or other causes of loss covered by this separate
property insurance.  All separate
policies shall provide this waiver of subrogation by endorsement or otherwise.

 

11.4.6      Before an exposure to
loss may occur, the Owner shall file with the Contractor a copy of each policy
that includes insurance coverages required by this Paragraph 11.4.  Each policy shall contain all generally
applicable conditions, definitions, exclusions and endorsements related to this
Project.  Each policy shall contain a
provision that the policy will not be canceled or allowed to expire, and that
its limits will not be reduced, until at least 30 days’ prior written notice
has been given to the Contractor.

 

11.4.7      Walvers of
Subrogation.  The Owner and Contractor
waive all rights against (1) each other and any of their subcontractors,
sub-subcontractors, agents and employees, each of the other, and (2) the
Architect, Architect’s consultants, separate contractors described in Article
6, if any, and any of their subcontractors, sub-subcontractors, agents and employees,
for damages caused by fire or other causes of loss to the extent covered by
property insurance obtained pursuant to this Paragraph 11.4 or other property
insurance applicable to the Work, except such rights as they have to proceeds
of such insurance held by the Owner as fiduciary.  The Owner or Contractor, as appropriate, shall require of the
Architect, Architect’s consultants, separate contractors described in Article
6, if any, and the subcontractors, sub-subcontractors,

 

46

 

agents and employees of any of them, by appropriate agreements, written
where legally required for validity, similar waivers each in favor of other
parties enumerated herein.  The policies
shall provide such waivers of subrogation by endorsement or otherwise.  A waiver of subrogation shall be effective
as to a person or entity even though that person or entity would otherwise have
a duty of indemnification, contractual or otherwise, and whether or not did not pay the
insurance premium has directly
and indirectly been paid,and whether or not the person or entity had an insurable interest in the
property damaged.

 

11.4.8      A loss insured under
Owner’s property insurance shall be adjusted by the Owner as fiduciary and made
payable to the Owner as fiduciary for the insureds, as their interests may
appear, subject to requirements of any applicable mortgagee clause and of
Subparagraph 11.4.10.  The Contractor
shall pay Subcontractors their just shares of insurance proceeds received by
the Contractor, and by appropriate agreements, written where legally required
for validity, shall require Subcontractors to make payments to their
Sub-subcontractors in similar manner.

 

11.4.9      If required in writing
by a party in interest, the Owner as fiduciary shall, upon occurrence of an
insured loss, give bond for proper performance of the Owner’s duties.  The cost of required bonds shall be charged
against proceeds received as fiduciary. 
The Owner shall deposit in a separate account proceeds so received, which
the Owner shall distribute in accordance with such agreement as the parties in
interest may reach, or in accordance with an arbitration award in which case
the procedure shall be as provided in Paragraph 4.6.  If after such loss no other special agreement is made and unless
the Owner terminates the Contract for convenience, replacement of damaged
property shall be performed by the Contractor after notification of a Change in
the Work in accordance with Article 7.

 

11.4.10    The Owner as fiduciary
shall have power to adjust and settle a loss with insurers unless one of the
parties in interest shall object in writing within five days after occurrence
of loss to the Owner’s exercise of this power, if such objection is made, the
dispute shall be resolved as provided in Paragraph 4.5 and 4.6.  The Owner as fiduciary shall, in the case or
arbitration, make settlement with insurers in accordance with directions of the
arbitrators. If distribution of insurance proceeds by arbitration is required,
the arbitrators will direct such distribution.

 

11.5                           PERFORMANCE BOND AND PAYMENT
BOND

11.5.1      The Owner shall have
the right to require the Contractor to furnish bonds covering faithful
performance of the Contract and payment of obligations arising thereunder as
stipulated in bidding requirements or specifically required in the Contract
Documents on the date of execution of the Contract.

 

11.5.2      Upon the request of
any person or entity appearing to be a potential beneficiary of bonds covering
payment of obligations arising under the Contract, the Contractor shall
promptly furnish a copy of the bonds or shall permit a copy to be made.

 

ARTICLE 12 UNCOVERING AND
CORRECTION OF WORK

12.1                           UNCOVERING OF WORK

12.1.1      If a portion of the
Work is covered contrary to the Architect’s request or to requirements
specifically expressed in the Contract Documents, it must, if required in
writing by the Architect, be uncovered for the Architect’s examination and be
replaced at the Contractor’s expense without change in the Contract Time.

 

12.1.2      If a portion of the
Work has been covered which the Architect has not specifically requested to
examine prior to its being covered, the Architect may request to see such Work
and it shall be uncovered by the Contractor. 
If such Work is in accordance with the Contract Documents, costs of
uncovering and replacement shall, by appropriate Change Order, be at the
Owner’s expense.  If such Work is not in
accordance with the Contract Documents, correction

 

47

 

shall be at the Contractor’s expense unless the condition was caused by
the Owner or a separate contractor in which even the Owner shall be responsible
for payment of such costs.

 

12.2                           CORRECTION OF WORK

12.2.1                  BEFORE OR AFTER SUBSTANTIAL
COMPLETION

12.2.1.1   The Contractor shall
promptly correct Work rejected by the Architect or failing to conform to the
requirements of the Contract Documents, whether discovered before or after
Substantial Completion and whether or not fabricated, installed or completed.
Costs of correcting such rejected Work, including additional testing and
inspections and compensation for the Architect’s services and expenses made
necessary thereby, shall be at the Contractor’s expense.

 

12.2.2                  AFTER SUBSTANTIAL COMPLETION

12.2.2.1   In addition to the
Contractor’s obligations under Paragraph 3.5, if, within one year after the
date of Substantial Completion of the Work or designated portion thereof or
after the date for commencement of warranties established under Subparagraph
9.9.1, or by terms of an applicable special warranty required by the Contract
Documents, any of the Work is found to be not in accordance with the
requirements of the Contract Documents, the Contractor shall correct it
promptly after receipt of written notice from the Owner to do so unless the
Owner has previously given the Contractor a written acceptance of such
condition.  The Owner shall give such
notice promptly after discovery of the condition.  During the one-year period for correction of Work, if the Owner
fails to notify the Contractor and give the Contractor an opportunity to make
the correction, the Owner waives the rights to require correction by the
Contractor and to make a claim for breach of warranty.  If the Contractor fails to correct
nonconforming Work within a reasonable time during that period after receipt of
notice from the Owner or Architect, the Owner may correct it in accordance with
Paragraph 2.4.

 

12.2.2.2   The one-year period for
correction of Work shall be extended with respect to portions of Work first
performed after Substantial Completion by the period of time between
Substantial Completion and the actual performance of the Work.

 

12.2.2.3   The one-year period for
correction of Work shall not be extended by corrective Work performed by the
Contractor pursuant to this Paragraph 12.2.

 

12.2.3      The Contractor shall
remove from the site portions of the Work which are not in accordance with the
requirements of the Contract Documents and are neither corrected by the
Contractor nor accepted by the Owner.

 

12.2.4       The Contractor shall bear the cost of
correcting destroyed or damaged construction, whether completed or partially
completed, of the Owner or separate contractors caused by the Contractor’s
correction or removal of Work which is not in accordance with the requirements
of the Contract Documents.

 

12.2.5      Nothing contained in
this Paragraph 12.2 shall be construed to establish a period of limitation with
respect to other obligations which the Contractor might have under the Contract
Documents. Establishment of the one-year period for correction of Work as
described in Subparagraph 12.2.2 relates only to the specific obligation of the
Contractor to correct the Work, and has no relationship to the time within
which the obligation to comply with the Contract Documents may be sought to be
enforced, nor to the time within which proceedings may be commenced to
establish the Contractor’s liability with respect to the Contractor’s
obligations other than specially to correct the Work.

 

48

 

12.3                           ACCEPTANCE OF NONCONFORMING
WORK

12.3.1      If the Owner prefers
to accept Work which is not in accordance with the requirements of the Contract
Documents, the Owner may do so instead of requiring its removal and correction,
which case the Contract Sum will be reduced as appropriate and equitable.  Such adjustment shall be effected whether or
not final payment has been made.

 

ARTICLE 13 MISCELLANEOUS
PROVISIONS

13.1                           GOVERNING LAW

13.1.1      The Contract shall be
governed by the law of the place where the Project is located.

 

13.2                           SUCCESSORS AND ASSIGNS

13.2.1      The Owner and
Contractor respectively bind themselves, their partners, successors, assigns
and legal representatives to the other party hereto and to partners,
successors, assigns and legal representatives of such other party in respect to
covenants, agreements and obligations contained in the Contract Documents.  Except as provided in Subparagraph 13.2.2
neither party to the Contract shall assign the Contract as a whole without written
consent of the other.  Except as hereinafter provided, neither party to the
Contract shall assign the Contract or sublet it as a whole without the written
consent of the other nor shall be Contractor assign any moneys due or to become
due to him hereunder, without the previous written consent of the Owner excepts
as may be required by Contractor’s Surety. 
Upon reasonable written notice to Contractor, the Owner may assign the
Contract to any Institutional lender providing construction or permanent financing
for the Project or to any person acquiring the Owner’s interest in the Project
and the contractor agrees to execute all consents certificates and other
documents required by such lender or other person in connection with such
assignment.  If either party
attempts to make such an assignment without such consent, that party shall
nevertheless remain legally responsible for all obligations under the Contract.

 

13.2.2      The Owner may,
without consent of the Contractor, assign the Contract to an institutional
lender providing construction financing for the Project.  In such event, the lender shall assume the
Owner’s rights and obligations under the Contract Documents.  The Contractor shall execute all consents
reasonably required to facilitate such assignment.  If the
Owner conveys its interest in the Project to a third party, any rights which
the Owner may have against the Contractor arising from this Agreement including
without limitation Claims under Article 12, or Claims which, under the terms of
subparagraph 4.3.10, are reserved to the Owner after the making and acceptance
of final payment, shall automatically transfer to such third party.

 

13.3                           WRITTEN NOTICE

13.3.1      Written notice shall
be deemed to have been duly served if delivered in person to the individual or
a member of the firm or entity or to an officer of the corporation for which it
was intended, or if delivered at or sent by registered or certified mail to the
last business address known to the party giving notice.

 

49

 

13.4                           RIGHTS AND REMEDIES

13.4.1      Duties and obligations
imposed by the Contract Documents and rights and remedies available thereunder
shall be in addition to and not a limitation of duties, obligations, rights and
remedies otherwise imposed or available by law.

 

13.4.2      No action or failure
to act by the Owner, Architect or Contractor shall constitute a waiver of a
right or duty afforded them under the Contract, nor shall such action or
failure to act constitute approval of or acquiescence in a breach thereunder,
except as may be specifically agreed in writing.

 

13.5                           TESTS AND INSPECTIONS

13.5.1      Tests, inspections and
approval of portions of the Work required by the Contract Documents or by laws,
ordinances, rules, regulations or order of public authorities having
jurisdiction shall be made at an appropriate time.  Unless otherwise provided, the Contractor shall make arrangements
for such tests, inspections and approvals with an independent testing
laboratory or entity acceptable to the Owner, or with the appropriate public
authority, and shall bear all related costs of tests, inspections and
approvals.  The Contractor shall give
the Architect timely notice of when and where tests and inspections are to be
made so that the Architect may be present for such procedures.  The Owner shall bear costs of tests,
inspections or approvals which do not become requirements until after bids are
received or negotiations concluded.

 

13.5.2      If the Architect,
Owner or public authorities having jurisdiction determine that portions of the
Work require additional testing, inspection or approval not included under
Subparagraph 13.5.1, the Architect will, upon written authorization from the
Owner, instruct the Contractor to make arrangements for such additional
testing, inspection or approval by an entity acceptable to the Owner, and the
Contractor shall give timely notice to the Architect of when and where tests
and inspections are to be made so that the Architect may be present for such
procedures.  Such costs, except as
provided in Subparagraph 13.5.3, shall be at the Owner’s expense.

 

13.5.3      If such procedures for
testing, inspection or approval under Subparagraphs 13.5.1 and 13.5.2 reveal
failure of the portions of the Work to comply with requirements established by
the Contract Documents, all costs made necessary by such failure including
those of repeated procedures and compensation for the Architect’s services and
expenses shall be at the Contractor’s expense.

 

13.5.4      Required certificates
of testing, inspection or approval shall, unless otherwise required by the
Contract Documents, be secured by the Contractor and promptly delivered to the
Architect.

 

13.5.5      If the Architect is
to observe tests, inspections or approvals required by the Contract Documents,
the Architect will do so promptly and, where practicable, at the normal place
of testing.

 

13.5.6      Tests or inspections
conducted pursuant to the Contract Documents shall be made promptly to avoid
unreasonable delay in the Work.

 

13.6                           INTEREST

13.6.1      Payments due and
unpaid under the Contract Documents shall bear interest from the date
payment is due at such rate as the parties may agree upon in writing or, in the
absence thereof, at the legal rate prevailing from time to time at the place
where the Project is located  beginning
on the tenth (10th) day after the date payment is due at the so-called Prime
Rate of Interest published by the Wall Street Journal (and if there is more
than one such rate the lowest thereof).

 

50

 

13.7                           COMMENCEMENT OF STATUTORY
LIMITATION PERIOD

13.7.1      As between the
Owner and Contractor:

.1               Before Substantial Completion.  As to acts or failures to act occurring
prior to the relevant date of Substantial Completion; any applicable statute of
limitations shall commence to run and any alleged cause of action shall be
deemed to have accrued in any all events not later than such date of
Substantial Completion;

.2               Between Substantial Completion and Final
Certificate for Payment. As to acts or failures to act occurring subsequent to
the relevant date of Substantial Completion and prior to issuance of the final
Certificate for Payment, any -applicable statute of limitations shall commence
to run and any alleged cause of action shall be deemed to have accrued in any
and all events not later than the date of issuance of the final Certificate for
Payment; and

.3               After Final Certificate for Payment. As
to acts or failures to act occurring after the relevant date of issuance of the
final Certificate for Payment, any applicable statute of limitations shall
commence to run and any alleged cause of action shall be deemed to have accrued
in any and all events not later than the date of any act or failure to act by
the Contractor pursuant to any Warranty provided under Paragraph 3.5, the date
of any correction of the Work or failure to correct the Work by the Contractor
under Paragraph 12.2, or the date of actual commission of any other act or
failure to perform any duty or obligation by the Contractor or Owner, whichever
occurs last.

 

13.8                        LIMITATION
OF LIABILITY

 

13.8.1    No
officer, shareholder, director, partner, partner agent or employee of the Owner
(or any partner of a partner or any agent or employee of a partner) shall ever
be personally or individually liable under this Contract.  Each subcontract shall include the foregoing
limitation, which shall be effective if the Owner ever succeeds to the
Contractor’s rights and obligations under a Subcontract.

 

ARTICLE 14   TERMINATION OR SUSPENSION OF THE CONTRACT

14.1                           TERMINATION BY THE
CONTRACTOR

14.1.1      The Contractor may
terminate the Contract if the Work is stopped for a period of 30 consecutive
days through no act or fault of the Contractor or a Subcontractor,
Sub-subcontractor or their agents or employees or any other persons or entities
performing portions of the work under direct or indirect contract with the
Contractor, for any of the following reasons:

.1               issuance
of an order of a court or other public authority having jurisdiction which
requires all Work to be stopped;

.2               an
act of government, such as a declaration of national emergency which requires
all Work to be stopped;

.3               because
the Architect has not issued a Certificate for Payment and has not notified the
Contractor of the reason for withholding certification as provided in
Subparagraph 9.4.1, or because the Owner has not made payment on a Certificate
for Payment within the time stated in the Contract Documents; or

.4               the
Owner has failed to furnish to the Contractor promptly; upon the Contractor’s
request, reasonable evidence as required by Subparagraph 2.2.1.

 

51

 

14.1.2      The Contractor may
terminate the Contract if, through no act or fault of the Contractor or a
Subcontractor, Sub-subcontractor or their agents or employees or any other
persons or entities performing portions of the Work under direct or indirect
contract with the Contractor, repeated suspensions, delays or interruptions of
the entire Work by the Owner as described in Paragraph 14.3 constitute in the
aggregate more than 100 percent of the total number of days scheduled for
completion, or 120 days in any 365-day period, whichever is less.

 

14.1.3      If one of the reasons
described in Subparagraph 14.1.1 or 14.1.2 exists, the Contractor may, upon
seven days’ written notice to the Owner and Architect, terminate the Contract
and recover from the Owner payment for Work executed and for proven loss with
respect to materials, equipment, tools, and construction equipment and
machinery, including reasonable overhead, profit and damages.

 

14.1.4      If the Work is stopped
for a period of 60 consecutive days through no act or fault of the Contractor
or a Subcontractor or their agents or employees or any other persons performing
portions of the Work under contract with the Contractor because the Owner has
persistently failed to fulfill the Owner’s obligations under the Contractor
Documents with respect to matters important to the progress of the Work, the
Contractor may, upon seven additional days, written notice to the Owner and the
Architect, terminate the Contract and recover from the Owner as provided in
Subparagraph 14.1.3.

 

14.2                           TERMINATION BY THE OWNER FOR
CAUSE

14.2.1     If
the Contractor is adjudged a bankrupt or if the Contractor makes a general
assignment for the benefit of the Contractor’s; creditors or if a receiver is
appointed on account of the Contractor’s insolvency or if the Contractor
persistently or repeatedly refuses or fails except in the case for which
extension of time is provided, to supply enough properly skilled workmen or
proper materials for the Project or if the Contractor fails to make prompt
payment to Subcontractors for materials or labor, or If the Contractor
persistently disregards the laws ordinances, rules, regulations or orders of
any public authority having jurisdiction or disregards an Instruction, order or
decision of the Architect or if the Contractor otherwise is guilty of a
substantial violation of any provision of the Contract then the Contractor
shall be in default and the Owner may without prejudice to any other right or
remedy and upon written notice to the Contractor take possession of all
materials, appliances equipment and machinery on the Project site, Intended as
part of or for Work, but only to the extent paid for by Owner wherever stored
and seven (7) days after such notice amy terminate the employment of the
Contractor, accept assignment of any or all subcontracts pursuant to Paragraph
5.4, and finish the Work by whatever method the Owner may deem expedient.  The Owner shall be entitled to collect form
the Contractor all direct indirect and consequential damages suffered by the
Owner.  The Owner shall be entitled to
hold 

 

52

 

sufficient amounts due the Contractor at the
date of termination to offset all of the Owner’s damages.

The Owner may terminate the Contract if the Contractor:

.1               persistently or repeatedly refuses or
fails to supply enough properly skilled -workers or proper materials,

.2               fails to make payment to Subcontractors
for materials or labor in accordance with the respective agreements between the
Contractor and the Subcontractors;

.3               persistently disregards laws,
ordinances, or rules, regulations or orders of a provision of the Contract
public authority having jurisdication; or

.4               otherwise is guiltyof substantial breach
of a provision of the Contract-Documents.

 

14.2.2      When any of the above
reasons exist, the Owner, upon certification by the Architect that sufficient
cause exists to justify such action may without prejudice to any other rights
or remedies of the Owner and after giving the Contractor and the Contractor’s
surety, if any, seven days’ written notice, terminate employment of the
Contractor and may, subject to any prior rights of the Surety: —

.1               take possession of the site and of all
materials, equipment, tools, and construction equipment and machinery thereon
owned by the Contractor;

.2               accept assignment of subcontracts
pursuant to Paragraph 5.4; and

.3               finish the Work by whatever reasonable
method the Owner may deem expedient. Upon request of the Contractor, the Owner
shall furnish to the Contractor a detailed accounting of the costs incurred by
the Owner in finishing the Work.

 

14.2.3      When the Owner
terminates the Contract for one of the reasons stated in subparagraph 14.2.1,
the Contractor shall not be entitled to receive further payment until the Work
is finished.

 

14.2.4      If the unpaid balance
of the Contract Sum exceeds costs of finishing the Work , including
compensation for the Architect’s services and expenses made necessary thereby,
and other damages incurred by the Owner and not expressly waived, such excess
shall be paid to the Contractor. If such costs and damages exceed the unpaid
balance, the Contractor shall pay the difference to the Owner. The amount to be
paid to the Contractor or Owner, as the case may be, shall be certified by the
Architect, upon application, and this obligation for payment shall survive
termination of the Contract.

 

14.3                           SUSPENSION BY THE OWNER FOR
CONVENIENCE

14.3.1      The Owner may, without
cause, order the Contractor in writing to suspend, delay or interrupt the Work
in whole or in part for such period of time as the Owner may determine.

 

14.3.2      The Contract Sum and
Contract Time shall be adjusted for increases in the cost and time caused by
suspension, delay or interruption as described in Subparagraph 14.3.1.
Adjustment of the Contract Sum shall include profit. No adjustment shall be
made to the extent:

.1               that performance is, was or would have
been so suspended, delayed or interrupted by another cause for which the
Contactor is responsible; or

.2               that an equitable adjustment is made or
denied under another provision of the Contract.

 

14.4                           TERMINATION BY THE OWNER FOR
CONVENIENCE

14.4.1      The Owner may, at any
time, terminate the Contract for the Owner’s convenience and without cause.

 

53

 

14.4.2      Upon receipt of
written notice from the Owner of such termination for the Owner’s convenience,
the Contractor shall:

.1               cease operations as directed by the
Owner in the notice;

.2               take actions necessary, or that the
Owner may direct, for the protection and preservation of the Work; and

.3               except for Work directed to be performed
prior to the effective date of termination stated in the notice, terminate all
existing subcontracts and purchase orders and enter into no further
subcontracts and purchase orders.

 

14.4.3      In case of such
termination for the Owner’s convenience, the Contractor shall be entitled to
receive payment for Work executed, and costs incurred by reason of such
termination, along with reasonable overhead and profit on the Work not
executed.

 

14.4.4     Upon
any termination of the Contract by Owner for convenience under 14.4 hereof,
Owner shall give Contractor fifteen (15) days written notice prior to such
termination becoming effective.

 

54

 

1997 Edition - Electronic Format

 

AIA Document A401 - 1997

 

Standard Form of Agreement Between Contractor
and Subcontractor

 

AGREEMENT
made as of the day of in the year

(In words, indicate day, month and year)

 

BETWEEN
the Contractor:

(Name, address and other information)

Louis P, Ciminelli Contruction Company, Inc.

The Cyclorama Building,

369 Franklin Street

Buffalo, New York 14202

 

and
the Subcontractor:

(Name, address and other information)

 

The
Contractor has made a contract for construction dated: September 1, 2001

 

With
the Owner:

(Name, address and other information)

Wheeling Island Gaming, Inc.

One South Stone Street

Wheeling, West Virginia 26003

 

For
the following Project:

(Include detailed description of Project,
location and address)

The “Project” consists of preconstruction and construction
services.  The preconstruction services
consist of the evaluation of the Owner’s program, scheduling and construction
budget formulation, and such additional services as are set forth in the
agreement between Construction Manager and Owner.  AIA Document A121/CMc 1991 Edition” Electronic Format dated
September 1, 2001 (the “Prime Contract”), with General Conditions of the
Contract for Construction, annexed thereto and made a part thereof, being AIA
Document A201-1997 - Electronic Format, as amended (the “General Conditions”),
for the construction of an approximately 279,100 square ft. conventionally
constructed facility which will house a casino, gaming facility, entertainment
center covered parking facility and hotel, located at One South Stone Street,
Wheeling, West Virginia (the “Site” or “site”), as is more fully set forth in the
Project Manual, Drawings and Specifications, which are incorporated by
reference into the Prime Contract. Included in the Project are all costs
associated with development of the Site, and acquisition and installation of
all steel, masonry, carpentry, electrical, plumbing and HVAC work, together
with the costs associated with the acquisition and installation of all
Improvements to complete the Project, Including but not limited to, developing
the casino theme.

 

ATTACHMENT II

 

THIS DOCUMENT HAS IMPORTANT LEGAL
CONSEQUENCES, CONSULTATION WITH AN ATTORNEY IS ENCOURAGED WITH RESPECT TO ITS
COMPLETION OR MODIFICATION. 
AUTHENTICATION OF THIS ELECTRONICALLY DRAFTED A/A DOCUMENT MAY BE MADE
BY USING A/A DOCUMENT D401.

 

This document has been approved
and endorsed by the American Subcontractors Association and the Associated
Specialty Contractors, Inc.

 

[LOGO]

 

©1997 A/A®

A/A DOCUMENT A401 - 1997

CONTRACTOR - SUBCONTRACTOR
AGREEMENT

 

The American Institute of
Architects

1735 New York Avenue, N.W.

Washington, D.C. 20006-5292

 

 

which Contract is  hereinafter
referred  to  as  the  Prime  Contract  and
which provides for the furnishing of labor, materials, equipment and
services in connection with the construction of the Project.  A copy of the Prime Contract, consisting of
the Agreement Between Owner and Contractor (from which compensation amounts may
be deleted) and the other Contract Documents enumerated therein has been made
available to the Subcontractor.

 

The
Architect for the Project is:

(Name, address and other information)

 

The
Contractor and the Subcontractor agree as follows.

 

ARTICLE 1       THE SUBCONTRACT
DOCUMENTS

1.1                                 The Subcontract Documents consist of (1) this
Agreement; (2) the Prime Contract, consisting of the Agreement between the
Owner and Contractor and the other Contract Documents enumerated therein; (3)
Modifications issued subsequent to the execution of the Agreement between the
Owner and Contractor, whether before or after the execution of this Agreement;
(4) other documents listed in Article 16 of this Agreement; and (5)
Modifications to this Subcontract issued after execution of this Agreement.
These form the Subcontract, and are as fully a part of the Subcontract as if
attached to this Agreement or repeated herein. 
The Subcontract represents the entire and integrated agreement between
the parties hereto and supersedes prior negotiations, representations or
agreements, either written or oral.  An
enumeration of the Subcontract Documents, other than Modifications issued
subsequent to the execution of this Agreement, appears in Article 16.

 

1.2                                 Except to the extent of a conflict with a
specific term or condition contained in the Subcontract Documents, the General
Conditions governing this Subcontract shall be the edition of AIA Document
A201, General Conditions of the Contract for Construction, current as of the
date of this Agreement,  attached to the Prime Contract, but as modified
herein by Schedule A attached hereto and made a part hereof.  Every time a reference is made herein to any
General Conditions.  It shall mean the
ones attached to the Prime Contract as modified by ScheduleA hereto.

 

1.3                                 The Subcontract may be amended or modified
only by a Modification.  The Subcontract
Documents shall not be construed to created a contractual relationship of any kind
(1) between the Architect and the Subcontractor, (2) between the Owner and the
Subcontractor, or (3) between any persons or entities other than the Contractor
and Subcontractor.

 

1.4                                 The Subcontractor shall be furnished copies
of the Subcontract Documents upon request, but the Contractor may charge the
Subcontractor for the reasonable cost of reproduction.

 

ARTICLE 2       MUTUAL RIGHTS AND
RESPONSIBILITIES

2.1                                 The Contractor and Subcontractor shall be
mutually bound by the terms of this Agreement and, to the extent that the
provisions of the edition of AIA Document A201 current as of the date of this
Agreement General Conditions that apply to this Agreement pursuant
to Paragraph 1.2 and provisions of the Prime Contract apply to the Work of the
Subcontractor, the Contractor shall assume toward the Subcontractor all
obligations and responsibilities that the Owner, under such documents, assumes
toward the Contractor, and the Subcontractor shall assume toward the Contractor
all obligations and responsibilities which the Contractor, under such
documents, assumes toward the Owner and the Architect.  The Contractor shall have the benefit of all
rights, remedies and redress against the Subcontractor which the Owner, under
such documents, has against the Contractor, and the Subcontractor shall have
the benefit of all rights, remedies and redress against the Contractor which
the Contractor, under such documents, has against the Owner, insofar as
applicable to this Subcontract.  Where a
provision

 

2

 

of such documents is inconsistent with a
provision of this Agreement, this Agreement shall govern.

 

2.2                                 The Contractor may require the Subcontractor
to enter into agreements with Sub-subcontractors performing portions of the Work
of this Subcontract by which the Subcontractor and the Sub-subcontractor are
mutually bound, to the extent of the Work to be performed by the
Sub-subcontractor, assuming toward each other all obligations and
responsibilities which the Contractor and Subcontractor assume toward each
other and having the benefit of all rights, remedies and redress each against
the other which the Contractor and Subcontractor have by virtue of the
provisions of this Agreement.

 

ARTICLE 3       CONTRACTOR

3.1                                 SERVICES PROVIDED BY THE CONTRACTOR

3.1.1                        The Contractor shall cooperate with the
Subcontractor in scheduling and performing the Contractor’s Work to avoid
conflicts or interference in the Subcontractor’s Work and shall expedite
written responses to submittals made by the Subcontractor in accordance with
Paragraph 4.1 and Article 5. As soon as practicable after execution of this
Agreement, the Contractor shall provide the Subcontractor copies of the
Contractor’s construction schedule and schedule of submittals, together with such
additional scheduling details as will enable the Subcontractor to plan and
perform the Subcontractor’s Work properly. 
The Subcontractor shall be notified promptly of subsequent changes in
the construction and submittal schedules and additional scheduling details.

 

3.1.2                        The Contractor shall provide suitable areas
for storage of the Subcontractor’s materials and equipment during the course of
the Work. Additional costs to the Subcontractor resulting from relocation of
such facilities at the direction of the Contractor, except as previously agreed
upon, shall be reimbursed by the Contractor.

 

3.1.3                        Except as provided in Article 14, the
Contractor’s equipment will be available to the Subcontractor only at the
Contractor’s discretion and on mutually satisfactory terms.

 

3.2                                 COMMUNICATIONS

3.2.1                        The Contractor shall promptly make available
to the Subcontractor information, including information received from the
Owner, which affects this Subcontract and which becomes available to the
Contractor subsequent to execution of this Subcontract.

 

3.2.2                        The Contractor shall not give instructions or
orders directly to the Subcontractor’s employees or to the Subcontractor’s
Sub-subcontractors or material suppliers unless such persons are designated as
authorized representatives of the Subcontractor.

 

3.2.3                        The Contractor shall permit the Subcontractor
to request directly from the Architect information regarding the percentages of
completion and the amount certified on account of Work done by the
Subcontractor.

 

3.2.4                        If hazardous substances of a type of which an
employer is required by law to notify its employees are being used on the site
by the Contractor, a subcontractor or anyone directly or indirectly employed by
them (other than the Subcontractor), the Contractor shall, prior to harmful
exposure of the Subcontractor’s employees to such substance, give written
notice of the chemical composition thereof to the Subcontractor in sufficient
detail and time to permit the Subcontractor's compliance with such laws.

 

3.2.5                        The Contractor shall furnish to the
Subcontractor within 30 days after receipt of a written request, or earlier if
so required by law, information necessary and relevant for the Subcontractor to
evaluate, give notice of or enforce mechanic’s lien rights.  Such information

 

3

 

shall include a correct statement of the
record legal title to the property, usually referred to as the site, on which
the Project is located and the Owner’s interest therein.

 

3.2.6                        If the Contractor asserts or defends a claim
against the Owner which relates to the Work of the Subcontractor, the
Contractor shall make available to the Subcontractor information relating to
that portion of the claim which relates to the Work of the Subcontractor.

 

3.3                                 CLAIMS
BY THE CONTRACTOR

3.3.1                        Liquidated
damages for delay, if provided for in Paragraph 9.3 of this Agreement, shall be
assessed against the Subcontractor only to the extent caused by the
Subcontractor or any person or entity for whose acts the Subcontractor may be
liable, and in no case for delays or causes arising outside the scope of this
Subcontract.

 

3.3.2                        The
Contractor's claims for services or materials provided the Subcontractor shall
require:

.1               seven days' prior written notice except
in an emergency;

.2               written compilations to the
Subcontractor of services and materials provided and charges for such services
and materials no later than the fifteenth day of the following month.

 

3.4                                 CONTRACTOR’S REMEDIES

3.4.1                        If the Subcontractor defaults or neglects to
carry out the Work in accordance with this Agreement and fails within three
working days after receipt of written notice from the Contractor to commence
and continue correction of such default or neglect with diligence and
promptness, the Contractor may, after three days following receipt by the
Subcontractor of an additional written notice, and without prejudice to any
other remedy the Contractor may have, make good such deficiencies and may
deduct the reasonable cost thereof from the payments then or thereafter due the
Subcontractor.

 

ARTICLE 4                     SUBCONTRACTOR

4.1                                 EXECUTION AND PROGRESS OF THE WORK

4.1.1                        The Subcontractor shall supervise and direct
the Subcontractor’s Work, and shall cooperate with the Contractor in scheduling
and performing the Subcontractor’s Work to avoid conflict, delay in or
interference with the Work of the Contractor, other subcontractors or Owner’s
own forces.

 

4.1.2                        The Subcontractor shall promptly submit Shop
Drawings, Product Data, Samples and similar submittals required by the
Subcontract Documents with reasonable promptness and in such sequence as to
cause no delay in the Work or in the activities of the Contractor or other
subcontractors.

 

4.1.3                        The Subcontractor shall submit to the
Contractor a schedule of values allocated to the various parts of the Work of
this Subcontract, aggregating the Subcontract Sum, made out in such detail as
the Contractor and Subcontractor may agree upon or as required by the Owner,
and supported by such evidence as the Contractor may require.  In applying for payment, the Subcontractor
shall submit statements based upon this schedule.

 

4.1.4                        The Subcontractor shall furnish to the
Contractor periodic progress reports on the Work of this Subcontract as
mutually agreed, including information on the status of materials and equipment
which may be in the course of preparation, manufacture or transit.

 

4.1.5                        The Subcontractor agrees that the Contractor
and the Architect will each have the authority to reject Work of the
Subcontractor which does not conform to the Prime Contract.

 

4

 

The Architect’s decisions on matters relating to aesthetic effect shall
be final and binding on the Subcontractor if consistent with the intent
expressed in the Prime Contract.

 

4.1.6                        The
Subcontractor shall pay for all materials, equipment and labor used in
connection with the performance of this Subcontract through the period covered
by previous payments received from the Contractor, and shall furnish
satisfactory evidence, when requested by the Contractor, to verify compliance
with the above requirements.

 

4.1.7                        The
Subcontractor shall take necessary precautions to protect properly the Work of
other subcontractors from damage caused by operations under this Subcontract.

 

4.1.8                        The
Subcontractor shall cooperate with the Contractor, other subcontractors and the
Owner’s own forces whose Work might interfere with the Subcontractor’s
Work.  The Subcontractor shall
participate in the preparation of coordinated drawings in areas of congestion,
if required by the Prime Contract, specifically noting and advising the
Contractor of potential conflicts between the Work of the Subcontractor and
that of the Contractor, other subcontractors or the Owner’s own forces.

 

4.2                                 LAWS, PERMITS, FEES
AND NOTICES

4.2.1                        The
Subcontractor shall give notices and comply with laws, ordinances, rules,
regulations and orders of public authorities bearing on performance of the Work
of this Subcontract. The Subcontractor shall secure and pay for permits and
governmental fees, licenses and inspections necessary for proper execution and
completion of the Subcontractor’s Work, the furnishing of which is required of
the Contractor by the Prime Contract.

 

4.2.2                        The
Subcontractor shall comply with Federal, state and local tax laws, social
security acts, unemployment compensation acts and workers’ compensation acts
insofar as applicable to the performance of this Subcontract.

 

4.3                                 SAFETY PRECAUTIONS AND
PROCEDURES

4.3.1                        The
Subcontractor shall take reasonable safety precautions with respect to
performance of this Subcontract, shall comply with safety measures initiated by
the Contractor and with applicable laws, ordinances, rules, regulations and
orders of public authorities for the safety of persons and property in
accordance with the requirements of the Prime Contract.  The Subcontractor shall report to the
Contractor within three days an injury to an employee or agent of the
Subcontractor which occurred at the site.

 

4.3.2                        If
hazardous substances of a type of which an employer is required by law to
notify its employees are being used on the site by the Subcontractor, the
Subcontractor’s Sub-subcontractors or anyone directly or indirectly employed by
them, the Subcontractor shall, prior to harmful exposure of any employees on
the site to such substance, give written notice of the chemical composition
thereof to the Contractor in sufficient detail and time to permit compliance
with such laws by the Contractor, other subcontractors and other employers on
the site.

 

4.3.3                        If
reasonable precautions will be inadequate to prevent foreseeable bodily injury
or death to persons resulting from a material or substance, including but not
limited to asbestos or polychlorinated biphenyl (PCB), encountered on the site
by the Subcontractor, the Subcontractor shall, upon recognizing the condition,
immediately stop Work in the affected area and report the condition to the
Contractor in writing. When the material or substance has been rendered
harmless, the Subcontractor’s Work in the affected area shall resume upon
written agreement of the Contractor and Subcontractor.  The Subcontract Time shall be extended
appropriately and the Subcontract Sum shall be increased in the amount of the
Subcontractor’s reasonable additional costs of demobilization, delay and
remobilization, which adjustments shall be accomplished as provided in Article
5 of this Agreement.

 

5

 

4.3.4                        To
the fullest extent permitted by law, the Contractor shall indemnify and hold
harmless the Subcontractor, the Subcontractor’s Sub-subcontractors, and agents
and employees of any of them from and against claims, damages, losses and
expenses, including but not limited to attorneys’ fees, arising out of or
resulting from performance of the Work in the affected area if in fact the
material or substance presents the risk of bodily injury or death as described
in Subparagraph 4.3.3 and has not been rendered harmless, provided that such
claim, damage, loss or expense is attributable to bodily injury, sickness,
disease or death, or to injury to or destruction of tangible property (other
than the Work itself) including loss of use resulting therefrom and provided
that such damage, loss or expense is not due to the sole negligence of a party
seeking indemnity.

 

4.4                                 CLEANING UP

4.4.1                        The
Subcontractor shall keep the premises and surrounding area free from
accumulation of waste materials or rubbish caused by operations performed under
this Subcontract.  The Subcontractor
shall not be held responsible for unclean conditions caused by other
contractors or subcontractors.

 

4.4.2                        As
provided under Subparagraph 3.3.2, if the Subcontractor fails to clean up as
provided in the Subcontract Documents, the Contractor may charge the
Subcontractor for the Subcontractor’s appropriate share of cleanup costs.

 

4.5                                 WARRANTY

4.5.1                        The
Subcontractor warrants to the Owner, Architect and Contractor that materials
and equipment furnished under this Subcontract will be of good quality and new
unless otherwise required or permitted by the Subcontract Documents, that the
Work of this Subcontract will be free from defects not inherent in the quality
required or permitted, and that the Work will conform to the requirements of
the Subcontract Documents and will be performed in a good and workmanlike
manner and with the degree of skill and care as would be expected of other
contractors performing similar work in the locale of the Project. Work not
conforming to these requirements, including substitutions not properly approved
and authorized, may be considered defective. 
The Subcontractor’s warranty excludes remedy for damage or defect caused
by abuse, modifications not executed by the Subcontractor, improper of
insufficient maintenance, improper operation, or normal wear and tear under
normal usage.  This Warranty shall be in
addition to and not in limitation of any other warranty or remedy required by
law or by the Subcontract Documents.

 

4.6                                 INDEMNIFICATION

4.6.1                        To
the fullest extent permitted by law, the Subcontractor shall indemnify and hold
harmless the Owner, Contractor, Architect, Architect’s consultants, and agents
and employees of any of them from and against claims, damages, losses and
expenses, including but not limited to attorney’s fees, arising out of or resulting
from performance of the Subcontractor’s Work under this Subcontract, provided
that any such claim, damage, loss or expense is attributable to bodily injury,
sickness, disease or death, or to injury to or destruction of tangible property
(other than the Work itself), but only to the extent caused by the negligent
acts or omissions of the Subcontractor, the Subcontractor’s Sub-subcontractors,
anyone directly or indirectly employed by them or anyone for whose acts they
may be liable, regardless of whether or not such claim, damage, loss or expense
is caused in part by a party indemnified hereunder.  Such obligation shall not be construed to negate, abridge, or
otherwise reduce other rights or obligations of indemnity which would otherwise
exist as to a party or person described in this Paragraph 4.6.

 

4.6.2                        In
claims against any person or entity indemnified under this Paragraph 4.6 by an
employee of the Subcontractor, the Subcontractor’s Sub-subcontractors, anyone
directly or indirectly employed by them or anyone for whose acts they may be
liable, the indemnification obligation under Subparagraph 4.6.1 shall not be
limited by a limitation on the amount or type

 

6

 

of damages, compensation or benefits payable by or for the
Subcontractor or the Subcontractor's Sub-subcontractors under worker’s
compensation acts, disability benefit acts or other employee benefit acts.

 

4.7                                 REMEDIES FOR
NONPAYMENT

4.7.1                        
If the Contractor does not pay the Subcontractor through no fault of the
Subcontractor, within seven days from the time payment should be made as
provided in this Agreement, the Subcontractor may, without prejudice to any
other available remedies, upon seven additional days’ written notice to the
Contractor, stop the Work of this Subcontract until payment of the amount owing
has been received.  The Subcontract Sum
shall, by appropriate adjustment, be increased by the amount of the
Subcontractor’s reasonable costs of demobilization, delay and remobilization.

 

ARTICLE 5       CHANGES IN THE WORK

5.1                                 The
Owner may make changes in the Work by issuing Modifications to the Prime
Contract.  Upon receipt of such a
Modification issued subsequent to the execution of the Subcontract Agreement,
the Contract shall promptly notify the Subcontractor of the Modification.  Unless, otherwise directed by the
Contractor, the Subcontractor shall not thereafter order materials or perform
Work which would be inconsistent with the changes made by the Modifications to
the Prime Contract.

 

5.2                                 The
Subcontractor may be ordered in writing by the Contractor, without invalidating
this Subcontract, to make changes in the Work within the general scope of this
Subcontract consisting of additions, deletions or other revisions, including
those required by Modifications to the Prime Contract issued subsequent to the
execution of this Agreement, the Subcontract Sum and the Subcontract Time being
adjusted accordingly.  The
Subcontractor, prior to the commencement of such changed or revised Work, shall
submit promptly to the Contractor written copies of a claim for adjustment to
the Subcontract Sum and Subcontract Time for such revised Work in a manner
consistent with requirements of the Subcontract Documents.

 

5.3                                 The
Subcontractor shall make all claims promptly to the Contractor for additional
cost, extensions of time and damages for delays or other causes in accordance
with the Subcontract Documents. A claim which will affect or become part of a
claim which the Contractor is required to make under the Prime Contract within
a specified time period or in a specified manner shall be made in sufficient
time to permit the Contractor to satisfy the requirements of the Prime
Contract.  Such claims shall be received
by the Contractor not less than two working days preceding the time by which
the Contractor’s claim must be made. Failure of the Subcontractor to make such
a timely claim shall bind the Subcontractor to the same consequences as those
to which the Contractor is bound.

 

ARTICLE 6                     MEDIATION AND
ARBITRATION

6.1                                 MEDIATION

6.1.1                        Any
claim arising out of or related to this Subcontract, except claims as otherwise
provided in Subparagraph 4.1.5 and except those waived in this Subcontract,
shall be subject to mediation as a condition precedent to arbitration or the
institution of legal or equitable proceedings by either party.

 

6.1.2                        The
parties shall endeavor to resolve their claims by mediation which, unless the
parties mutually agree otherwise, shall be in accordance with the Construction
Industry Mediation Rules of the American Arbitration Association currently in
effect.  Request for mediation shall be
filed in writing with the other party to this Subcontract and the American
Arbitration Association.  The request
may be made concurrently with the filing of a demand for arbitration but, in
such event, mediation shall proceed in advance of arbitration or legal or
equitable proceedings, which shall be stayed pending mediation for a period of
60 days from the date of filing, unless stayed for a longer period by agreement
of the parties or court order.

 

7

 

6.1.3                        The
parties shall share the mediator’s fee and any filing fees equally.  The mediation shall be held in the place
where the Project is located, unless another location is mutually agreed
upon.  Agreements reached in mediation
shall be enforceable as settlement agreements in any court having jurisdiction
thereof.

 

6.2                                 ARBITRATION

6.2.1                        Any
claim arising out of or related to this Subcontract, except claims as otherwise
provided in Subparagraph 4.1.5 and except those waived in this Subcontract,
shall be subject to arbitration.  Prior
to arbitration, the parties shall endeavor to resolve disputes by mediation in
accordance with the provisions of Paragraph 6.1.

 

6.2.2                        Claims
not resolved by mediation shall be decided by arbitration which, unless the
parties mutually agree otherwise, shall be in accordance with the Construction
Industry Arbitration Rules of the American Arbitration Association currently in
effect.  Demand for arbitration shall be
filed in writing with the other party to this Subcontract and with the American
Arbitration Association, and a copy shall be filed with the Architect.

 

6.2.3                        A
demand for arbitration shall be made within the time limits specified in the conditions
of the Prime Contract as applicable, and in other cases within a reasonable
time after the claim has arisen, and in no event shall it be made after the
date when institution of legal or equitable proceedings based on such claim
would be barred by the applicable statute of limitations

 

6.2.4                        Limitation on Consolidation or Joinder.
Except by written consent of the person or entity sought to be joined, no
arbitration arising out of or relating to the Subcontract shall include, by
consolidation or joinder or in any other manner, any person or entity not a
party to the Subcontract under which such arbitration arises, unless it is
shown at the time the demand for arbitration is filed that (1) such person or
entity is substantially involved in a common question of fact or law, (2) the
presence of such person or entity is required if completed relief is to be
accorded in the arbitration, (3) the interest or responsibility of such person
or entity in the matter is not insubstantial, and (4)such person or entity is
not the Architect, the Architect’s employee, the Architect’s consultant, or an
employee or agent of any of them. This agreement to arbitrate and any other
written agreement to arbitrate with an additional person or persons referred to
herein shall be specifically enforceable under applicable law in any court
having jurisdiction thereof.

 

6.2.5                        Claims and Timely Assertion of Claims. The
party filing a notice of demand for arbitration must assert in the demand all
claims then known to that party on which arbitration is permitted to be
demanded.

 

6.2.6                        Judgment on Final Award. The award
rendered by the arbitrator or arbitrators shall be final, and judgment may be
entered upon it in accordance with applicable law in any court having
jurisdiction thereof.

 

ARTICLE 7       TERMINATION, SUSPENSION OR ASSIGNMENT OF
THE SUBCONTRACT

7.1                                 TERMINATION
BY THE SUBCONTRACTOR

7.1.1                        The
Subcontractor may terminate the Subcontract for the same reasons and under the
same circumstances and procedures with respect to the Contractor as the
Contractor may terminate with respect to the Owner under the Prime Contract, or
for nonpayment of amounts due under this Subcontract for 60 days or
longer.  In the event of such
termination by the Subcontractor for any reason which is not the fault of the
Subcontractor, Sub-subcontractors or their agents or employees or other persons
performing portions of the Work under contract with the Subcontractor, the
Subcontractor shall be entitled to recover from the Contractor payment for Work
executed and for proven loss with respect to materials, equipment, tools,

 

8

 

and construction equipment and machinery, including reasonable
overhead, profit and damages.

 

7.2                                 TERMINATION BY THE
CONTRACTOR

7.2.1                        If
the Subcontractor persistently or repeatedly fails or neglects to carry out the
Work in accordance with the Subcontract Documents or otherwise to perform in
accordance with this Subcontract and fails within seven days after receipt of
written notice to commence and continue correction of such default or neglect
with diligence and promptness, the Contractor may, after seven days following
receipt by the Subcontractor of an additional written notice and without
prejudice to any other remedy the Contractor may have, terminate the
Subcontract and finish the Subcontractor’s Work by whatever method the
Contractor may deem expedient. If the unpaid balance of the Subcontract Sum
exceeds the expense of finishing the Subcontractor’s Work and other damages
incurred by the Contractor and not expressly waived, such excess shall be paid
to the Subcontractor.  If such expense
and damages exceed such unpaid balance, the Subcontractor shall pay the
difference to the Contractor.

 

7.2.2                        If
the Owner terminates the Contract for the Owner’s convenience, the Contractor
shall deliver written notice to the Subcontractor.

 

7.2.3                        Upon
receipt of written notice of termination, the Subcontractor shall:

.1               cease
operations as directed by the Contractor in the notice;

.2               take
actions necessary, or that the Contractor may direct, for the protection and
preservation of the Work; and

.3               except
for work directed to be performed prior to the effective date of termination
stated in the notice, terminate all existing Sub-subcontracts and purchase orders
and enter into no further Sub-subcontracts and purchase orders.

 

7.2.4                        In
case of such termination for the Owner’s convenience, the Subcontractor shall
be entitled to receive payment for Work executed, and costs incurred by reason
of such termination, along with reasonable overhead and profit on the Work not
executed, completed.

 

7.3                                 SUSPENSION BY THE
CONTRACTOR FOR CONVENIENCE

7.3.1                        The
Contractor may, without cause, order the Subcontractor in writing to suspend,
delay or interrupt the Work of this Subcontract in whole or in part for such
period of time as the Contractor may determine.  In the event of suspension ordered by the Contractor, the
Subcontractor shall be entitled to an equitable adjustment of the Subcontract
Time and Subcontract Sum.

 

7.3.2                        An
adjustment shall be made for increases in the Subcontract Time and Subcontract
Sum, including profit on the increased cost of performance, caused by
suspension, delay or interruption.  No
adjustment shall be made to the extent:

.1               that
performance is, was or would have been so suspended, delayed or interrupted by
another cause for which the Subcontractor is responsible;

.2               that
an equitable adjustment is made or denied under another provision of this
Subcontract.

 

7.4                                 ASSIGNMENT OF THE
SUBCONTRACT

7.4.1                        In
the event of termination of the Prime Contract by the Owner, the Contractor may
assign this Subcontractor to the owner, with the Owner’s agreement, subject to
the provisions of the Prime Contract and to the prior rights of the surety, if
any, obligated under bonds relating to the Prime Contract. In such event, the
Owner shall assume the Contractor’s rights and obligations under the
Subcontract Documents.  If the Work of
the Prime Contract has been suspended for more than 30 days, the
Subcontractor’s compensation shall be equitably adjusted.

 

9

 

7.4.2                        The
Subcontractor shall not assign the Work of this Subcontract without the written
consent of the Contractor, nor Subcontract the whole of this Subcontract without
the written consent of the Contractor, nor further subcontract portions of this
Subcontract without written notification to the Contractor when such
notification is requested by the Contractor.

 

ARTICLE 8                     THE WORK OF
THIS SUBCONTRACT

8.1                                 The
Subcontractor shall execute the following portion of the Work described in the
Subcontract Documents, including all labor, materials, equipment, services and
other items required to complete such portion of the Work, except to the extent
specifically indicated in the Subcontract Documents to be the responsibility of
others:
                                                                 .

 

	
   

  
	
   

  
	
   

  
	
   

  

 

(Insert a precise description of the Work of
this Subcontract, referring where appropriate to numbers of Drawings, sections
of Specifications and pages of Addenda, Modifications and accepted Alternates.)

 

ARTICLE 9                     DATE OF
COMMENCEMENT AND SUBSTANTIAL COMPLETION

9.1                                 The
Subcontractor’s date of commencement is the date from which the Contract Time
of Paragraph 9.3 is measured; it shall be the date of this Agreement, as first
written above, unless a different date is stated below or provision is made for
the date to be fixed in a notice to proceed issued by the Contractor.

(Insert the date of commencement, if it
differs from the date of this Agreement or, if applicable, state that the date
will be fixed in a notice to proceed.)

 

9.2                                 Unless
the date of commencement is established by a notice to proceed issued by the
Contractor, or the Contractor has commenced visible Work at the site under the
Prime Contract, the Subcontractor shall notify the Contractor in writing not
less than five days before commencing the Subcontractor’s Work to permit the
timely filing of mortgages, mechanic’s liens and other security interests.

 

9.3                                 The
Work of this Subcontract shall be substantially completed not later than

(Insert the calendar date or number of
calendar days after the Subcontractor’s date of commencement. Also insert any
requirements for earlier Substantial Completion of certain portions of the
Subcontractor’s Work, if not stated elsewhere in the Subcontract Documents.)

 

, subject to adjustments of this Subcontract Time as provided in the
Subcontract Documents.

(Insert provisions, if any, for liquidated
damages relating to failure to complete on time.)

 

9.4                                 With
respect to the Obligations of both the Contractor and the Subcontractor, time
is of the essence of this Subcontract.

 

9.5                                 No
extension of time will be valid without the Contractor’s written consent after
claim made by the Subcontractor in accordance with Paragraph 5.3.

 

10

 

ARTICLE 10     SUBCONTRACT SUM

10.1                           The
Contractor shall pay the Subcontractor in current funds for performance of the
Subcontract the Subcontract Sum of Dollars ($    ), subject
to additions and deduction as provided in the Subcontract Documents.

 

10.2                           The
Subcontract Sum is based upon the following alternates, if any, which are
described in the Subcontract Documents and have been accepted by the Owner and
the Contractor:

(Insert the numbers or other identification
of accepted alternates)

 

10.3                           Unit
prices, if any, are as follows:

 

ARTICLE 11               PROGRESS PAYMENTS

11.1                           Based
upon applications for payment submitted to the Contractor by the Subcontractor,
corresponding to applications for payment submitted by the Contractor to the
Architect, and certificates for payment issued by the Architect, the Contractor
shall make progress payments on account of the Subcontract Sum to the
Subcontractor as provided below and elsewhere in the Subcontract Documents.
Unless the Contractor provides the Owner with a payment bond in the full penal
sum of the Contract Sum, payments received by the Contractor and Subcontractor
for work properly performed by their contractors and suppliers shall be held by
the Contractor and Subcontractor for those contractors or suppliers who
performed Work or furnished materials, or both, under contract with the
Contractor or Subcontractor for which payment was made to the Contractor by the
Owner or to the Subcontractor by the Contractor, as applicable.  Nothing contained herein shall require money
to be placed in a separate account and not commingled with money of the
Contractor or Subcontractor, shall create any fiduciary liability of tort
liability on the part of the Contractor or Subcontractor for breach of trust or
shall entitle any person or entity to an award of punitive damages against the
Contractor or Subcontractor for breach of the requirements of this provision.

 

11.2                           The
period covered by each application for payment shall be one calendar month
ending on the last day of the month, or as follows:

 

11.3                           Provided
an application for payment is received by the Contractor not later than the day
of a month, the Contractor shall include the Subcontractor’s Work covered by
that application in the next application for payment which the Contractor is
entitled to submit to the Architect. The Contractor shall pay the Subcontractor
each progress payment within three working days after the Contractor receives
payment from the Owner. If the Architect does not issue a certificate for
payment or the Contractor does not receive payment for any cause which is not
the fault of the Subcontractor, the Contractor shall pay the Subcontractor, on
demand, a progress payment computed as provided in Paragraphs 11.7,11.8,11.9.

 

11.4                           If
an application for payment is received by the Contractor after the application
date fixed above, the Subcontractor’s Work covered by it shall be included by
the Contractor in the next application for payment submitted to the Architect.

 

11.5                           Each
application for payment shall be based upon the most recent schedule of values
submitted by the Subcontractor in accordance with the Subcontractor Documents.
The schedule of values shall allocate the entire Subcontract Sum along the
various portions of the Subcontractor’s Work and be prepared in such form and
supported by such data to substantiate its accuracy as the Contractor may
require. This schedule, unless objected to by the Contractor, shall be used as a
basis for reviewing the Subcontractor’s applications for payment.

 

11.6                           Applications
for payment submitted by the Subcontractor shall indicate the percentage of
completion of each portion of the Subcontractor’s Work as of the end of the
period covered by the application for payment.

 

11

 

11.7                           Subject
to the provisions of the Subcontract Documents, the amount of each progress
payment shall be computed as follows:

 

11.7.1                  Take
that portion of the Subcontract Sum properly allocable to completed Work as
determined by multiplying the percentage completion of each portion of the
Subcontractor’s Work by the share of the total Subcontract Sum allocated to
that portion of the Subcontractor’s Work in the schedule of values, less that
percentage actually retained, if any, from payments to the Contractor on
account of the Work of the Subcontractor. Pending final determination of cost
to the Contractor of changes in the Work which have been properly authorized by
the Contractor, amounts not in dispute shall be included to the same extent
provided in the Prime Contract, even though the Subcontract Sum has not yet
been adjusted;

 

11.7.2                  Add
that portion of the Subcontract Sum properly allocable to materials and
equipment delivered and suitably stored at the site by the Subcontractor for
subsequent incorporation in the Subcontractor’s Work or, if approved by the
Contractor, suitably stored off the site at a location agreed upon in writing,
less the same percentage retainage required by the Prime Contract to be applied
to such materials and equipment in the Contractor’s application for payment;

 

11.7.3                  Subtract
the aggregate of previous payments made by the Contractor; and

 

11.7.4                  Subtract
amounts, if any, calculated under Subparagraph 11.7.1 or 11.7.2 which are
related to Work of the Subcontractor for which the Architect has withheld or
nullified, in whole or in part, a certificate of payment for a cause which is
the fault of the Subcontractor.

 

11.8                           Upon
the partial or entire disapproval by the Contractor of the Subcontractor’s
application for payment, the Contractor shall provide written notice to the
Subcontractor. When the basis for the disapproval has been remedied, the
Subcontractor shall be paid the amounts withheld.

 

11.9                           SUBSTANTIAL COMPLETION

11.9.1                  When
the Subcontractor’s Work or a designated portion thereof is substantially
complete and in accordance with the requirements of the Prime Contract, the
Contractor shall, upon application by the Subcontractor, make prompt application
for payment for such Work. Within 30 days following issuance by the Architect
of the certificate for payment covering such substantially completed Work, the
Contractor shall, to the full extent allowed in the Prime Contract, make
payment to the Subcontractor, deducting any portion of the funds for the
Subcontractor’s Work withheld in accordance with the certificate to cover costs
of items to be completed or corrected by the Subcontractor. Such payment to the
Subcontractor shall be the entire unpaid balance of the Subcontract Sum if a
full release of retainage is allowed under the Prime Contract for the
Subcontractor’s Work prior to the completion of the entire project.  If the Prime Contract does not allow for a
full release of retainage, then such payment shall be an amount which, when
added to previous payments to the Subcontractor, will reduce the retainage on
the Subcontractor’s substantially completed Work to the same percentage of
retainage as that on the Contractor’s Work covered by the certificate.

 

ARTICLE 12               FINAL PAYMENT

12.1                           Final
payment, constituting the entire unpaid balance of the Subcontract Sum, shall
be made by the Contractor to the Subcontractor when the Subcontractor’s Work is
fully performed in accordance with the requirements of the Subcontract
Documents, the Architect has issued a certificate for payment covering the
Subcontractor’s completed Work and the Contractor has received payment from the
Owner.  If, for any cause which is not
the fault of the Subcontractor, a certificate for payment is not issued or the
Contractor does not receive timely payment or does not pay the Subcontractor
within three working days after receipt of payment from the Owner, final
payment to the Subcontractor shall be made upon demand.

(Insert provisions for earlier final payment
to the Subcontractor, if applicable)

 

12

 

12.2                           Before
issuance of the final payment, the Subcontractor, if required, shall submit
evidence satisfactory to the Contractor that all payrolls, bills for materials
and equipment, and all known indebtedness connected with the Subcontractor’s
Work have been satisfied.

 

ARTICLE 13               INSURANCE AND BONDS

13.1                           The
Subcontractor shall purchase and maintain insurance of the following types of
coverage and limits of liability:  AS
PER SCHEDULE A ANNEXED

 

13.2                           Coverages,
whether written on an occurrence or claims-made basis, shall be maintained
without interruption from date of commencement of the Subcontractor’s Work
until date of final payment and termination of any coverage required to be
maintained after final payment to the Subcontractor.

 

13.3                           Certificates
of insurance acceptable to both the Contractor and the Owner
shall be filed with the Contractor prior to commencement of the Subcontractor’s
Work.  These certificates and the
insurance policies required by this Article 13 shall contain a provision that
coverages afforded under the policies will not be canceled or allowed to expire
until at least 30 days’ prior written notice has been given to the Contractor.
If any of the foregoing insurance coverages are required to remain in force
after final payment and are reasonably available, an additional certificate
evidencing continuation of such coverage shall be submitted with the final
application for payment as required in Article 12. If any information
concerning reduction of coverage is not furnished by the insurer, it shall be
furnished by the Subcontractor with reasonable promptness according to the
Subcontractor’s information and belief.

 

13.4                           The
Contractor shall furnish to the Subcontractor satisfactory evidence of
insurance required of the Contractor under the Prime Contract.

 

13.5                           The
Contractor shall promptly, upon request of the Subcontractor, furnish a copy or
permit a copy to be made of any bond covering payment of obligations arising
under the Subcontract.

 

13.6                           Performance
Bond and Payment Bond:

(If the Subcontractor is to furnish bonds,
insert the specific requirements here)

Subcontractor shall provide a payment and performance bond in the
amount of 100% of the amount of Subcontractor’s Work under this Subcontract
with such bonding company, such bond provisions, and naming such obligees as
are reasonably satisfactory to both Owner and Contractor. Both Contractor and
Owner shall receive original or duplicate original bonds.

 

13.7                           PROPERTY
INSURANCE

13.7.1                  When
requested in writing, the Contractor shall provide the Subcontractor with
copies of the property and equipment policies in effect for the Project. The
Contractor shall notify the Subcontractor if the required property insurance
policies are not in effect.

 

13.7.2                  If
the required property insurance is not in effect for the full value of the
Subcontractor’s Work, then the Subcontractor shall purchase insurance for the
value of the Subcontractor’s Work, and the Subcontractor shall be reimbursed
for the cost of the insurance by an adjustment in the Subcontract Sum.

 

13.7.3                  Property
insurance for the Subcontractor's materials and equipment required for the
Subcontractor's Work, stored off site or in transit and not covered by the
Policy property insurance, shall be paid for through the application for
payment process.

 

13.8                           WAIVERS
OF SUBROGATION

13.8.1                  The
Contractor and Subcontractor waive all rights against (1) each other and any of
their Subcontractors, sub-subcontractors, agents and employees, each of the
other, and (2) the

 

13

 

Owner, the Architect, the Architect’s consultants, separate
contractors, and any of their subcontractors, sub-subcontractors, agents and
employees for damages caused by fire or other causes of loss to the extent
covered by property insurance provided under the Prime Contract or other
property insurance applicable to the Work, except such rights as they may have
to proceeds of such insurance held by the Owner as a fiduciary. The
Subcontractor shall require of the Subcontractor’s Sub-subcontractors, agents
and employees, by appropriate agreements, written where legally required for
validity, similar waivers in favor of the parties enumerated herein. The
policies shall provide such waivers of subrogation by endorsement or
otherwise.  A waiver of subrogation
shall be effective as to a person or entity even though that person or entity
would otherwise have a duty of indemnification, contractual or otherwise, did
not pay the insurance premium directly or indirectly, and whether or not the
person or entity had an insurable interest in the property damaged.

 

ARTICLE 14               TEMPORARY
FACILITIES AND WORKING CONDITIONS

14.1                           The
Contractor shall furnish and make available to the Subcontractor the following
temporary facilities, equipments and services; these shall be furnished at not
cost to the Subcontractor unless otherwise indicated below:

 

14.2                           Specific
working conditions:

(Insert any applicable arrangements
concerning working conditions and labor matters for the Project)

 

ARTICLE 15               MISCELLANEOUS
PROVISIONS

15.1                           Where
reference is made in this Subcontract to a provision of another Subcontract
Document, the reference refers to that provision as amended or supplemented by
other provisions of the Subcontract Documents.

 

15.2                           Payments
due and unpaid under this Subcontract shall bear interest from the date payment
is due at such rate as the parties may agree upon in writing or, in the absence
thereof, at the legal rate prevailing from time to time at the place where
the Project is located.

(Insert rate of interest agreed upon, if
any.)

“prime rate” of interest published from time to time in the Wall Street
Journal.

 

(Usury laws and requirements under the
Federal Truth in Lending Act, similar state and local consumer credit laws and
other regulations at the Owner’s, Contractor’s and Subcontractor’s principal
places of business, the location of the Project and elsewhere may affect the
validity of this provision. Legal advice should be obtained with respect to
deletions or modifications, and also regarding requirements such as written
disclosures or waivers.)

 

15.3                           Retainage
and any reduction thereto is as follows:

10% of each progress payment shall be retained from Subcontractor until
the Contractor’s Work is fully completed, at which time Subcontractor shall be
paid all funds so retained.

 

15.4                           The
Contractor and Subcontractor waive claims against each other for consequential
damages arising out of or relating to this Subcontract, including without
limitation, any consequential damages due to either party’s termination in
accordance with Article 7.

 

ARTICLE 16               ENUMERATION OF
SUBCONTRACT DOCUMENTS

16.1                           The
Subcontract Documents, except for Modifications issued after execution of this
Subcontract, are enumerated as follows:

 

16.1.1                  This
executed 1997 edition of the Standard Form of Agreement Between Contractor and
Subcontractor, AIA Document A401-1997;

 

16.1.2                  The
Prime Contract, consisting of the Agreement between the Owner and Contractor
dated as first entered above and the other Contract Documents enumerated in the
Owner-Contractor Agreement;

 

14

 

16.1.3                  The
following Modifications to the Prime Contract, if any, issued subsequent to the
execution of the Owner-Contractor Agreement but prior to the execution of this
Agreement:

 

	
  Modification

  	
   

  	
  Date

  

 

16.1.4                  Other
Documents, if any, forming part of the Subcontract Documents are as follows:

(Lists any additional documents that are
intended to form part of the Subcontract Documents Requests for proposal and
the Subcontractor’s bid or proposal should be listed here only if intended to
be part of the Subcontract Documents.)

 

This Agreement entered into as of
the day and year first written above

 

	
   

  	
   

  	
   

  
	
  CONTRACTOR (Signature)

  	
   

  	
  SUBCONTRACTOR (Signature)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Printed name and title)

  	
   

  	
  (Printed name and title)

  

 

15

 

Wheeling Island Gaming, Inc.

 

DOCUMENT 00450

 

SUPPLEMENTARY CONDITIONS

 

The following supplements,
modify the “General Conditions of the Contract for Construction”, “AIA Document
A201, 1997 Edition. Where a portion of the General Conditions is modified or
deleted by these Supplementary Conditions, the unaltered portions of the
General Conditions shall remain in effect. These modify the General conditions
to the Prime Contract which are a part of the Subcontract by reference.

 

ARTICLE
1; GENERAL PROVISONS

 

1.1                       Basic
Definitions

 

Add to 1.1 the following
Subparagraph 1.1.8:

 

1.1.8              Miscellaneous
Definitions

 

.1                                       Indicated:
Shown on drawings by notes, graphics or schedules, or written into other
portions of contract documents. Terms such as “shown”, “noted”, “scheduled” and
“specified” have same meanings as “indicated”, and are used to assist the
reader in locating particular information.

 

.2                                       Directed,
Requested, Approved, Accepted, etc.: These terms imply by the Architect and/or
Construction Manager, unless otherwise indicated.

 

.3                                       Approved
by Architect and/or Construction Manager: In no case releases Subcontractor
from the responsibility to fulfill requirements of Contract Documents.

 

.4                                       
Project Site: Space available to Subcontractor at location of project, either
exclusively or to be shared with separate contractors, for performance of the
work.

 

.5                                       Furnish:
Supply and deliver to project site, ready for unloading, unpacking, assembly,
installation and similar subsequent requirements.

 

.6                                       Install:
Operations at project site, including unloading, unpacking assembly, erection,
placing, anchoring, applying working to dimension, finishing, curing,
protecting, cleaning and similar requirements.

 

.7                                       Provide:
Furnish and install, complete and ready for intended use.

 

.8                                       Installer:
Entity (firm or person) engaged to install work by Subcontractor or
subsubcontractor. Installers are required to be skilled experts in work they
are engaged to install.

 

	
  Louis P.
  Ciminelli

  	
   

  	
  00450-1

  	
   

  	
  February 22,2002

  
	
  Consrtuction
  Co., Inc

  	
   

  	
   

  	
   

  	
   

  

 

SCHEDULE A TO SUBCONTRACT

 

1

 

.9                                       Or
Equal Approved By Architect and/or Construction Manager.  Where products named in specifications are
followed by this clause or by other language of similar effect, comply with
provisions of this project manual concerning substitutions and for obtaining
Architect and/or Construction Manager approval to provide an unnamed product.

 

1.1.8.10                                                         Contractor:
Where the term “Contractor” is used in the General Conditions and elsewhere
throughout the Contract Documents, it shall mean the Contractors who have been
engaged by the Construction Manager for the work.  The terms “Contractor” and “Subcontractor” may be used
interchangeably throughout the Contract Documents.

 

1.1.8.11                                                         Construction
Manager: The Owner has retained Louis P. Ciminelli Construction Co., Inc. as
Construction Manager for the project. 
Sometimes referred to herein as “Construction Manager” and sometimes as
“CM”.

 

1.2                       Execution,
Correlation and Intent

 

Add to 1.2.3 the following
Subparagraph 1.2.3.1:

 

1.2.3.1               In
the case of overlapping or conflicting requirements, the most stringent
(generally most costly) applies and will be enforced, unless more detailed
language written directly into Contract Documents clearly indicates that a less
stringent requirement is acceptable. 
Refer uncertainties to Architect and/or Construction Manager for
decision before proceeding.

 

Add to 1.2 the following
Subparagraphs 1.2.4, 1.2.5, 1.2.6 and 1.2.6.1:

 

1.2.4                        General
Requirements: Sections of Division 1 – General Requirements, govern the
execution of all Sections of the Specifications.  All Sections are subject to the administrative and procedural
requirements as specified in Division 1 as well as the broader requirements of
the General Conditions of the Contract.

 

1.2.5                        Minimum
Requirements: Indicated requirements are for a specific minimum acceptable
level of quality, as recognized in the industry.  Actual work must comply (within specified tolerances), or may
exceed minimums within reasonable limits. 
Refer uncertainties to Architect and/or Construction Manager before
proceeding.

 

1.2.6                        Abbreviations,
Plural Words: Abbreviations, where not defined in Contract Documents, will be
interpreted to mean the normal construction industry terminology, determined by
recognized grammatical rules, by the Architect and/or Construction
Manager.  Plural words will be
interpreted as singular, and singular

 

2

 

words will be
interpreted as plural where applicable for context of Contract Documents.

 

1.2.6.1               Where
abbreviations or acronyms are used in Contract Documents, they mean the well
recognized name of entity in building construction industry; refer
uncertainties to Architect and/or Construction Manager before proceeding, or
consult Encyclopedia of Associations by Gale Research Co.

 

ARTICLE
2; OWNER

 

2.1                       Definition

 

2.1.1                        Add
the following to Paragraph 2.1.1: The Owner shall be defined as Wheeling Island
Gaming, Inc., One South Stone Street, Wheeling, West Virginia 26003.

 

2.2                                 Information
and Services Required of the Owner.

 

2.2.2                        Add
the following clause to subparagraph 2.2.2: “2.2.2.1 Data concerning site,
size, access to site, staging and storing, present obstructions on or near the
site, conditions of existing adjacent structures, locations and depths of
sewers.  Conduits or pipes, gas lines,
position of sidewalks, curbs and pavements, and other data concerning site
conditions, has been obtained from sources Owner believes reliable.  Accuracy of such data, however, is not
guaranteed and is furnished solely for accommodation of Contractor.  Use of such data is made at Contractor’s
sole risk and expense.”

 

ARTICLE
3; CONTRACTOR

 

3.3                                 Supervision
and Construction Procedures

 

3.3.1                        Add
the following to the end of Paragraph 3.3.1: “Each Contractor agrees that it
will be solely responsible for the organization, supervision, safety practices
and equipment employed in executing its work for the Project.  Each Contractor therefore agrees that it
shall defend and hold the Owner, Construction Manager and Architect/Engineer
harmless from any claim including all attorney’s fees asserted by any of
Contractor’s agents or employees and will pay any defense cost of the Owner,
Construction Manager or Architect/Engineer, if a suit is brought against them.”

 

3

 

3.3.4                        Add
the following Paragraph 3.3.4: “The Contractor shall ensure that the
Contractors’ employees and subcontractors, and their agents and employees,
conform to project requirements for proper conduct, safety practices, labor
harmony and protection of the Owner’s property.”

 

3.4                       Labor and
Materials

 

Add to 3.4 the following
Subparagraphs 3.4.4, 3.4.5, 3.4.6, 3.4.7, 3.4.8, 3.4.9, 3.4.10, 3.4.10.1,
3.4.10.2, 3.4.10.3 & 3.4.10.4:

 

3.4.4                        Contractors
shall not employ men, means, materials, or equipments that may cause strikes,
work stoppages, or any disturbances by workmen employed by the Contractor, or
other Contractors or Subcontractors, on or in connection with the work of the
project, or the location thereof.  Contractors
agree that all disputes regarding jurisdiction of trades shall be adjusted in
accordance with any plan for the settlement of jurisdictional disputes that may
be in effect either nationally or in the locality in which the work is being
done and that it shall be bound and abide by all such adjustments and
settlements of jurisdictional disputes, provided that the provisions of this
article shall not be in violation of or in conflict with any provisions of law
applicable to the settlement of such disputes.

 

3.4.5                        Contractors
shall make every reasonable effort to avoid labor disputes and to insulate the
Owner, Construction Manager and other Contractors from the effects of labor
disputes should any arise.

 

3.4.6                        Add
the following Paragraph 3.4.6: “Contractors shall be advised the Owner is
signatory to a Project Labor Agreement. 
A copy of that agreement is attached to the Prime Contract.

 

3.4.7                        Add
the following Paragraph 3.4.7: “Not later than 10 days from the Contract date,
the Contractor shall provide a list showing the name of the manufacturer’s
proposed to be used for each of the products identified in the Specifications
and, where applicable, the name of the installing Subcontractor:”

 

3.4.8                        Add
the following Paragraph 3.4.8: “The Construction Manager will promptly reply in
writing to the Contractor stating whether the Owner or the Construction
Manager, after due investigation, has reasonable objection to any such
proposal.  If adequate data on any
proposed manufacturer or installer is not available, the Construction Manager
may state that action will be deferred until the Contractor provide further
data.  Failure of the Owner or the
Architect to promptly advise the Construction Manager of any reasonable
objection or failure shall constitute notice of no reasonable objection.
Failure to object to a manufacturer shall not constitute a waiver of any of the
requirements of the Contract Documents, and all products furnished by the
listed manufacturer must conform to such requirements.”

 

4

 

3.4.9                        Add
the following Paragraph 3.4.9: “After the Contract has been executed, the
Owner, the Architect and the Construction Manager will consider a formal
request for the substitution of products in place of those specified only under
the conditions set forth in the General Requirements, Division 1.”

 

3.4.10                  Add
the following Paragraph 3.4.10: “By making requests for substitutions based on
Subparagraph 3.4.8 above, the Contractor.”

 

3.4.10.1         Add
the following Subparagraph 3.4.10.1: “represents that the Contractor has
personally investigated the proposed substitute product and determined that it
is equal or superior in all respects to that specified;”

 

3.4.10.2         Add
the following Subparagraph 3.4.10.2: “represents that the Contract will provide
the same warranty for the substitution that the Contractor would for that
specified;”

 

3.4.10.3         Add
the following Subparagraph 3.4.10.3: “certified that the cost date presented is
complete and includes all related costs under this Contract except the
Architect's redesign costs, and waives all claims for additional costs related
to the substitution which subsequently become apparent, and”

 

3.4.10.4         Add
the following Subparagraph 3.4.10.4: “shall coordinate the installation of the
accepted substitution, making such changes as may be required for the work to
be complete in all respects.”

 

3.7                       Permits,
Fees and Notices

 

3.7                                 Delete
Paragraph 3.7.1 in its entirety and substitute the following:

 

“3.7.1 The
Construction Manager will obtain required building permits.  This action will not relieve any Contractor
from other fees and permit requirements.

 

Other trade
permits, required by the City of Wheeling, West Virginia, will be the
responsibility of the respective Contractors.

 

5

 

Each
Contractor, in securing other permits for construction or any other aspect of
the work associated with this project which requires a permit, notwithstanding
language in the agreement, shall at his own cost and expense, make the
necessary arrangements to complete, file and have sealed by a Professional
Engineer licensed in the jurisdiction, any and all preliminary affidavits of
certification that may be required by the governing agency or agencies having
jurisdiction for issuing permits for construction for this project, prior to
stating construction.”

 

3.7.6              Add the following
Subparagraph:

 

“3.7.6 Each
Contractor shall secure approval of and comply with requirements of all
authorities and deliver certificates of approval to the Architect, and shall
prepare all documents, including Drawings, necessary to secure approval.”

 

3.7.7              Add the following
Subparagraph:

 

“3.7.7 In the
event any violations are placed upon the premises by the public authority as a
result of the Contractor’s fault, in connection with the work, said Contractor
shall be solely responsible therefore and shall bear all costs attributable
thereto.”

 

3.9                       Superintendent

 

3.9.2              Add the following of
the end of Paragraph:

 

“3.9.2 The Contractor’s site representative(s) shall be satisfactory to
CM and Owner, based upon credentials to be submitted by Contractor, and such
representatives shall be changed only with consent of/CM and Owner.  If, for any reason, Contractor’s representatives
and unsatisfactory, and upon request of /CM or Owner, other qualified
representatives shall be substituted.”

 

3.10                 Contractors
Construction Schedules

 

3.10.3                  After
the word “schedules”, delete the Period (.) and insert “, but shall not exceed
the time limits under the Contract Documents.”

 

3.17                 Royalties,
Patents and Copyrights

 

3.17.1                  Add
the following to the end of subparagraph 3.17.1:

 

“...In the
event of legal action arising out of such infringement for which the Contractor
is responsible and which action has the effect of stopping the work, the CM or
Owner may require the Contractor to substitute other products of like kinds as
will makes it possible to pursue and complete the work.  Costs and expenses caused thereby shall be
borne by Contractor”.

 

6

 

3.18                 Indemnification:

 

Add the following to the end of
Paragraph 3.18.1:

 

“3.18.1 In
addition to the obligations of the Contractor set forth in paragraph 3.18.1, to
the fullest extent permitted by laws and regulations, and Contractor shall indemnify
and hold harmless Owner, Construction Manager, agents and employees for all
claims, damages, losses and expenses, direct, indirect or consequential
(including but not limited to fees and charges of engineers, architects,
attorneys and other professionals and court and mediation costs) arising out
of, or resulting from, the act or omissions of the Subcontractors, Suppliers
and other persons and organizations performing or furnishing any of the work
under a direct or indirect contract with Contractor.”

 

Add the following new
Subparagraphs 3.18.3 and 3.18.4

 

“3.18.3 Unless
otherwise stated in the Agreement, each Contractor shall, before commencing
work, take out and pay for such insurance as may be required to complete with
the indemnification and hold harmless provisions outlined under Articles 3.18.1
and 3.18.2. Such insurance shall be with such companies as may be satisfactory
to the Owner and Architect.  Insurance
shall be so written as to prevent cancellation without at least 30 days written
notice to Owner, Architect and Construction Manager.”

 

“3.18.4 A
certificate of the required insurance naming the Architect, Engineer,, Owner,
Construction manager, Consultants or any such other professional parties shall
be submitted prior to start of work.  Said
insurance shall be maintained through the entire project life.”

 

ARTICLE
4; ADMINISTRATION OF THE CONTRACT

 

4.2                       Architect’s
Administration of the Contract

 

Add to 4.2.7 the following
Clause 4.2.7.1:

 

4.2.7.1               In
general, allow 15 calendar days for Architect review of submittals.  Review time begins on the day that the
Architect actually receives and submittals and does not includes mailing
times.  The Architect reserves the right
to require longer review times for major items and for large volumes of submittals.

 

ARTICLE
7; CHANGES IN THE WORK

 

7.3                       Construction
Change Directives

 

7

 

“The allowance
for overhead and profit for all changes in the work shall be calculated based
on the following:

 

For work
performed by a Contractor’s or Subcontractor’s own forces, the Contractor or
Subcontractor shall add 10% for overhead and profit.  For work performed by a Subcontractor, the Prime Contractor shall
add 5% for overhead and profit to the total value of the Subcontractor’s
price.  The allowance for overhead and
profit shall include supervision, field office and general expenses, overhead
and profit.”

 

ARTICLE
8; TIME

 

8.1                       Definitions

 

Add the following clause to
Subparagraph 8.1.3:

 

8.1.3.1               “Pursuant
to Subparagraph 8.1.3: as supplemented hereinafter as between the Owner and the
Contractor: as to all acts or failures to act occurring prior to the relevant
Date of Substantial Completion, any applicable statute of limitations shall
commence to run and any alleged cause of action shall be deemed to have accrued
in any event and all events not later than the date of issuance of the final
Certificate of Payment.”

 

ARTICLE
9; PAYMENTS AND COMPLETION

 

9.3                       Applications
for Payment

 

9.3.1                        Add
the following to the end of Article 9.3.1: Until final completion, the Owner
shall pay 90% of the amount due to the Contractor on account of each progress
payment, less an amount necessary to satisfy any claims, liens or judgments
against Contractor which have not been suitably discharged.

 

9.6                       Progress
Payments

 

Change Paragraph 9.6.1 to read
as follows:

 

9.6.1                        After
the Architect has signed a Project Certificate for Payment, the Owner shall
make payment in the following manner:

 

The Owner
shall make payment to CM within 30 days following receipt of the Certificate
for Payment.  Payment by CM to the
Contractors will be made within 10 days of such receipt from Owner.

 

Add the following to the end of
Paragraph 9.6.2:

 

8

 

9.6.2                        To
the extent permitted by West Virginia law, Contractors shall include pay when
paid language in their subcontracts establishing the subcontractors shall not
be entitled to payments until payment has been received by the CM from the
Owner

 

ARTICLE
10; PROTECTION OF PERSON AND PROPERTY

 

10.1                 Safety
Precautions and Programs

 

10.1.1.1                                     Add
Subparagraph 10.1.1.1:

 

“10.1.1.1 If
so directed by the Construction Manager, the Contractor shall immediately
correct any unsafe conditions and shall implement continued correctional
measures to the unsafe conditions identified by the Construction Manager.”

 

10.3                 Hazardous
Materials

 

10.3.4        Add the following
Subparagraphs 10.3.4 and 10.3.5:

 

“10.3.4 The
Contractor, when providing, using, storing, delivering or disposing of any
toxic, hazardous or potentially dangerous materials, shall advise the Owner and
CM in writing of the condition of such hazardous materials in advance of
conducting any work and is responsible for protecting their own employees, the
Owner, and CM and all agents from the hazards associated with such
materials.  The contractor shall furnish
written directions, precautions, or training, provided or made available from
the supplier of the materials, or other acceptable source, for use by all
persons who may be subject to the hazard. 
The Contractors shall comply with all applicable regulations and
laws.  The Contractor shall dispose of
any hazardous or toxic substances in accordance with all applicable regulations
or laws, including E.P.A and D.O.T., and shall provide the Owner and CM with
the appropriate generator E.P.A. number. 
The Contractor shall perform all required procedures necessary to insure
that there will be no discharge, spillage, uncontrolled loss, seepage, or
filtration of any hazardous or toxic waste on the site caused by their
operations.  Contractor is responsible
for any and all costs and liabilities associated with the clean-up of any such
spillage etc., or as required by regulating authorities having jurisdiction,
and holds the /CM Owner and its agents, harmless against any current or future
liabilities resulting from such incidents.”

 

“10.3.5 All
material and equipment furnished under the Contract shall be free of asbestos
and polychlorinated biphenyl (PBC).  Any
materials or equipments containing these hazardous materials shall be
considered effective and shall be removed by the Contractor at their own
expense.”

 

9

 

ARTICLE
11; INSURANCE AND BONDS

 

11.1                 Contractors
Liability Insurance

 

11.1.2        Add the following
Subparagraphs 11.1.2.1, 11.1.2.2 and 11.1.2.3 to 11.1.2:

 

11.1.2.1         It
is understood and agreed that the insurance coverage and limits, required
below, shall not limit the extent of the Contractor’s responsibilities and
liability specified within the Contract Documents or by law.

 

11.1.2.2         The
insurance required by Subparagraph 11.1.1 shall be written for not less than
the following or greater if required by law.

 

	
  (1)

  	
   

  	
  Worker’s
  Compensation and Employer’s Liability Insurance

  	
   

  	
  As required
  by Statute.  No exclusions for
  partners, proprietors or executive officers.

  
	
  (2)

  	
   

  	
  Comprehensive
  Automobile Liability (including owned, non-owned, leased and hired
  automobiles)

  	
   

  	
  Limit not
  less than $2 million combined single limit for bodily injury or property
  damage.

  
	
  (3)

  	
   

  	
  Commercial
  General Liability:

  Insurance for liability due to personal injury, bodily injury or property
  damage sustained or alleged to have been sustained by any person with the
  following limits:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a) General
  Aggregate

  	
   

  	
  $66,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (b) Products
  and Completed Operations and Aggregate

  	
   

  	
  $2,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (c) Personal
  and Advertising Injury

  	
   

  	
  $2,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (d) Each
  Occurrence

  	
   

  	
  $2,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  All coverage
  shall be on an Occurrence Form. 
  Claims-made coverage is not acceptable.  General Aggregate limit to apply separately to each project
  (per project aggregate endorsements).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (4)

  	
   

  	
  Umbrella
  Liability

  	
   

  	
  $5,000,000
  each occurrence and aggregate.

  

 

10

 

11.1.2.3         In
addition to the above coverage’s, Contractors performing asbestos abatement,
lead abatement and/or other environmental work shall provide Pollution
Liability Insurance to cover their operations with a limit of $2,000,000 per
occurrence and aggregate coverage.

 

11.1.3        Add the following clause
11.1.3.1:

 

11.1.3.1         “All
policies shall name Owner and also name Louis P.  Ciminelli Construction Co., Inc. and the Architect/Engineer and
their consultants as Additional Insured (Form B) and providing that such
insurance is Primary insurance as respects the interest of the /Owner and the
Construction Manager and that any other insurance maintained by the Owner
and/or Construction Manager in excess.”

 

11.4                 Property
Insurance

 

11.4.1                  First
line, delete the word “Contractor” and substitute “Construction Manager”.

 

11.4.2.1         Add
the following sentence to Subparagraph 11.4.2.1:

 

“The property
insurance is written with a deductible of $25,000 and each Contractor is
responsible to pay costs not covered because of such deductible.”

 

11.5                 Performance Bond
and Payment Bond

 

11.5.1        Add the following to the
end of Paragraph 11.5.1:

 

“Each
Contractor shall provide a 100% Performance Bond and a 100% Labor and Material
Payment Bond on Forma A312.  The total
cost of such bonds shall be included in the Contract price.  Bonds are to be issued as Dual Obligee
Bonds, naming Wheeling Island Gaming, Inc. and Louis P. Ciminelli Construction
Co., Inc. as Obligees.”

 

ARTICLE
12; UNCOVERING AND CORRECTION OF WORK

 

12.2.2.2                                     Add
the following to the end of Paragraph 12.2.2.2:

 

“12.2.22
Contractors’ warranties shall commence on the date of final completion and
acceptance of the Project in Prime Contract. 
In the event that systems and/or equipment are started and operated, or
areas and materials on the Project are utilized prior to the date of final
completion of the Project, the warranty for said items shall be appropriately
extended at no additional costs to the owner, in order that the specified
duration of the warranty will be in full force and effect upon completion of the
Project.”

 

11

 

ARTICLE
13; MISCELLANEOUS PROVISIONS

 

13.5                 Tests and
Inspections

 

Add to 13.5 the following
Subparagraph 13.5.7:

 

13.5.7                  “Provide
for Tests and Inspections under the provisions of the General Requirements
(Division 1 of the Specifications).”

 

ARTICLE
14; TERMINATION OF SUSPENSION OF THE CONTRACT

 

14.1.3                  After
the word “profit”, insert a period (.) and delete the remainder of the
sentence.

 

END
OF DOCUMENT

 

12

 

ASSIGNMENT AND ASSUMPTION AGREEMENT

 

OWNER:                                   Wheeling Island
Gaming, Inc., One South Stone Street, Wheeling, WV 26003

 

	
  CONSTRUCTION MANAGER:

  	
  Louis
  P.  Ciminelli Construction Company,
  Inc.

  
	
   

  	
  The
  Cyclorama Building, Buffalo, NY 14202

  

 

PROJECT:
The “Project” consists of the construction of an approximately 279,100
square ft. conventionally constructed facility as is more fully set forth in
the agreement between Construction Manager and Owner, AIA Document A121/CMc
1991 Edition - Electronic Format dated September 1, 2001 (the “Prime
Contract”), with General Conditions of the Contract for Construction, annexed
thereto and made a part thereof, being AIA Document A201-1997 - Electronic
Format, as amended (the “General Conditions”), which will house a casino,
gaming facility, entertainment center, covered parking facility and hotel,
located at One South Stone Street, Wheeling, West Virginia.  Included in the Project are all costs
associated with development of the site, and acquisition and installation of
all steel, masonry, carpentry, electrical, plumbing and HVAC work, together
with the costs associated with the acquisition and installation of all
improvements to complete the Project, including but not limited to, developing
the casino theme.

 

SUBCONTRACT:                             The
attached contract between the Owner and other party to the attached contract
(“Subcontractor”), for the construction and/or supply of labor and/or materials
for some or all of the Project.

 

DATE:                                          

 

IN CONSIDRATION of
the agreements contained herein, and other good and valuable consideration
exchanged between Owner and Construction Manager, the receipt and sufficiency
thereof being hereby acknowledged, it is agreed as follows:

 

1.                             Assignment.
Owner hereby assigns all of its rights and obligations under the Subcontract to
Construction Manager such that Subcontractor is now deemed to have performed
all of its duties and obligations under the Subcontract for Construction
Manager in furtherance of Construction Manager’s duties and obligations to
Owner to complete the Project pursuant to the Prime Contract as supplemented by
the General Conditions.

 

2.                             Assumption.
Construction Manager hereby assumes all of Owner’s obligations and duties under
the Subcontract as if Construction Manager were the original signatory thereto,
subject, however, to the provisions of the Prime Contract as supplemented by
the General Conditions.

 

IN WITNESS
WHEREOF, this Agreement has been executed effective the day and year first
above written.

 

	
  Wheeling
  Island Gaming, Inc., Owner

  	
   

  	
  Louis P.
  Ciminelli Construction Company, Inc.,

  Construction Manager

  
	
  By

  	
   

  	
  By

  
	
   

  	
   

  	
   

  

 

ATTACHMENT III

 

 

	
   

  	
  Upper Ohio Valley Building

  and Construction Trades Council

  
	
  [Upper Ohio Valley Building

  and Construction Trades Council LOGO]

  	
  President: Bill Dean

  Secy-Treas: Gary Kosky

  Vice-Pres: Tom Gray

  	
  304-232-2660

  304-232-2540

  304-243-7000

  	
  329 North 4th Street

  Steubenville, Ohio 43952

  740-283-1429

  Fax 304-232-7241

  

 

[SEAL]

 

August 22, 2001

 

Mr. Gary Bichler President
& COO

Louis P. Ciminelli Constr. Co. Inc.

369 Franklin St.

Buffalo, NY. 142020-1790

 

RE: Wheeling Downs Gaming
Complex, Phase II

 

Dear Mr. Bichler:

 

I want to thank you on behalf
of the Upper Ohio Valley Building Trades Council for the brief overview of the
proposed phase II expansion at the Wheeling Downs Gaming Complex.  The Council is looking forward too working
with Louis P. Ciminelli Constr. Co. Inc. in making this dream of Delaware North
Companies a reality.  All affiliated
Locals, except Plumbers Local #83 and Elevator Constructors Local #6, have
signed the Project Labor Agreement and agree to work on the Phase II expansion
under the terms and conditions of the agreement for the duration of the project
or until the expiration date of December 31, 2002, whichever comes first.

 

If you have any questions or
concerns please call.

 

 

Sincerely

 

	
  /s/ Gary
  Kosky

  	
   

  
	
  Gary Kosky

  Secretary/Treasurer

  Upper Ohio Valley Building Trades Council

  

 

	
  cc:

  	
  Roy Olsen,
  Delaware North Companies

  Scott Cooper, Wheeling Downs

  Tom Cerra, O.V.C.E.C.

  File

  

 

ATTACHMENT IV

 

 

WHEELING DOWNS GAMING COMPLEX

Wheeling, West Virginia

 

Project
Labor Agreement

 

The Owner will require the
Construction Manager [Louis P. Ciminelli Construction Co., Inc.] to use only
Trade Contractors who are signatory to the Trades Council’s current collective
bargaining agreements (“Agreements”) for the on-site construction of the
Project.  This commitment will apply to
all trades performing work on the Project, except for landscaping work and any
specialty work that will be performed by other separate contractors under
direct contract to the Owner, such as delivery, handling and installation of
furniture, fixtures and equipment which includes, but is not limited to, gaming
and security equipment, telephone and computer/date, equipment, food service
and bar equipment and specialty stage and lighting equipment.  As agreed, these items are excluded to the
extent they involve sensitive security matters and specialty, theme-related or
proprietary systems work.

 

In consideration for this
commitment by the Owner, the Trades Council and its member unions agree to the
following:

 

1.               There
will be no strike or picketing whatsoever by the Trades Council, its member
unions or their members for the duration of the Project.

 

2.               The
wage rates stipulated for journeyman in each and every current and/or future
Agreements will be reduced by ten (10) percent.  This 10% wage reduction will stay in force for the duration of
the Project or until December 31, 2002, whichever comes first.

 

3.               If
work on the Project is to be suspended, all Trade Contractors shall be
responsible for providing workers employed by them with actual notice of the
work suspension.  If a worker does not
receive actual notice of the work suspension prior to arriving at the Project,
the workers shall receive one hour of show-up time.  If work is suspended after worker has commenced a shift on the
Project, workers shall be paid for all time actually spent on the shift.

 

4.               The
Trade Contractors and/or Construction Manager may schedule four (4) ten (10)
hour shifts during the work week, using Friday as a voluntary make-up day
because of inclement weather only, Saturday will be paid time-and-a-half, and
all Sunday work shall be paid double-time. 
The Trade Contractors and/or Construction Manager may schedule five (5)
eight (8) hour shifts during the work week, using Saturday as a voluntary
make-up day because of inclement weather only, and all Sunday work be paid
double-time.

 

5.               The
apprenticeship ratio in Agreements will be increased to allow for additional
apprentices at the Trade Contractors’ discretion.

 

 

6.               Shift
differentials will be eliminated in all Agreements.

 

In order to construct the
Project, the Owner requires assurances that value pricing will be obtained through
competitive bidding.  The Construction
Manager shall be required to obtain, in a timely fashion, a minimum of three
bona fide bids from Trade Contractors who are signatory to the Agreements for
each segment of work that is bid as a separate bid package, and, the amount of
submitted bid(s) for each segment of work must be considered acceptable by the
Construction Manager and the Owner.  If
the Construction Manager experiences a lack of bona fide bids or unacceptable
pricing, the Trade Council and its member unions will cooperate with the
Construction Manager and the Owner in an effort to obtain additional bids from
competent Trade Contractors and/or reduced bids from Trade Contractors who have
already tendered bids by taking various steps that might include such measures
as making further contractual modifications in the Agreements and/or allowing
Trade Contractors to become signatory to collective bargaining agreements on a
single project basis.

 

The terms established in this
agreement shall be incorporated by reference in the agreement between Owner and
Construction Manager, such that Construction Manager will be bound to the Owner
in accordance with this agreement. 
Similarly, the bids and subcontracts on the Project will necessarily
refer to, and incorporate, the requirements of this agreement.

 

 

[ILLEGIBLE]

 

DEED

 

THIS DEED,
made this 18th day of April, 2000, by and between THE OHIO COUNTY
COMMISSION, Ohio County, West Virginia, party of the first part, and WHEELING
DOWNS RACING ASSOCIATION, INC., a West Virginia corporation, with its principal
office and place of business in Wheeling, Ohio County, West Virginia, party of
the second part.

 

WITNESSETH:
That for and in consideration of the sum of Ten Dollars ($10.00) and other good
and valuable consideration, the receipt of which is hereby acknowledged, the
party of the first part hereby grants and conveys to the party of the second
part, with covenant of special warranty, the following described parcels of
real estate, together with all improvements situate thereon and appurtenances
thereunto belonging, situate in the City of Wheeling, County of Ohio, State of
West Virginia, that is to say:

 

A parcel of
land situate in Wheeling-Madison District, City of Wheeling, Ohio County, West
Virginia, the boundaries of which are the exterior wall lines and exterior
stairs of a Clubhouse Addition to the Graridstand of Wheeling Downs Racing
Association, being more particularly described as follows

 

Beginning at
the easternmost corner of the exterior block wall of said Clubhouse Addition,
said corner was found to bear S. 25° 14’07” W., 888.95 feet from a
cross (+) In a concrete sidewalk and found in the westerly line of South Penn
Street, Said cross (+) was found to bear N. 06° 35’W., 454.20 feet along the
westerly line of South Penn Street, from its intersection with the southerly
line of Stone Street. Said cross (+) was also found to bear
S. 69° 49’08” E., 877.81 feet from a 1” pipe found at the
intersection of the westerly line of Lane N and the northerly property line of
Wheeling Downs Racing Association, Inc. (Deed Book 434, at page 371).

 

Thence from
said point of beginning and with the exterior wall lines and the perimeters of
exterior concrete stairs, the following twenty-four (24) courses:

 

(01)                                    S. 30° 31’ 43” W., 36.00
feet;

(02)                                    S. 59° 28’ 17” E., 9.65
feet;

(03)                                    S. 30° 31’ 43” W., 7.87
feet;

(04)                                    N. 59° 28’ 17” W., 9.65
feet;

(05)                                    S. 30° 31’ 43” W., 28.38
feet;

(06)                                    S.
59° 28’ 17” E., 8.72 feet;

(07)                                    S. 30° 31’ 43” W., 7.65
feet;

(08)                                    N. 59° 28’ 17” W., 8.72
feet;

(09)                                    S. 30° 31’ 43” W., 52.70
feet;

(10)                                    S 59° 28’ 17” E., 5.90
feet;

(11)                                    S. 30° 31’ 43” W., 7.76
feet;

(12)                                    N. 59° 28’ 17” W., 5.90
feet;

(13)                                    S. 30° 31’ 43” W., 18.28
feet;

(14)                                    N.
59° 28’ 17” W., 4.01 feet;

(15)                                    S. 32° 00’ 55” E., 4.65
feet;

(16)                                    N. 75° 10’ 01” W., 96.49
feet;

(17)                                    N.
15° 08’ 09” E., 112.00 feet;

 

ATTACHMENT V

 

 

(18)                                    S. 75° 37’ 33” E., 0.80 feet;

(19)                                    N. 15° 40’ 09” E., 73.11 feet;

(20)                                    S. 74° 35’ 03” E., 23.88 feet;

(21)                                    S. 15° 41’ 45” W., 73.03 feet;

(22)                                    S. 78° 37’ 33” E., 1.04 feet;

(23)                                    N. 30° 28’ 48” E., 73.99 feet;
and

(24)                            S. 59° 28’ 08” E., 101.07 feet
to the point of beginning containing 20,893.77 square feet, more or less, as
surveyed in June of 1981 by Michael T. Stahl, WV LLS #613.

 

Being the same
property conveyed by Wheeling Downs Racing Association, a West Virginia
corporation, to the Ohio County Commission, Ohio County, West Virginia, by Deed
dated June 17, 1981, and recorded in the Office of the Clerk of County
Commission of Ohio County, West Virginia, in Deed Book 502, at Page 146.

 

IN WITNESS
WHEREOF, the party of the first part has caused these presents to be signed,
and its seal to be hereto affixed and attested, by authority duly given, as of
the date aforesaid,

 

	
   

  	
  THE OHIO
  COUNTY COMMISSION

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ David J.
  Sims

  
	
   

  	
   

  	
   

  
	
   

  	
  Its

  	
  President

  
	
   

  
	
  ATTEST:

  	
   

  
	
   

  	
   

  
	
  /s/
  [ILLEGIBLE]

  	
   

  
	
  Title:

  	
  Administrator

  	
   

  
					

 

STATE OF WEST VIRGINIA,

 

COUNTY OF OHIO, To-wit:

 

The foregoing
instruments was acknowledged before me this 18th day of April 2000,
by David J. Sims of The Ohio County Commission, Ohio County, West Virginia, on
behalf of said Commission.

 

	
   

  	
  /s/ Sara J.
  Bowman

  
	
   

  	
  Notary
  Public

  
	
   

  
	
  My
  Commission Expires:

  
	
  March 25,
  2007

  	
   

  
			

 

2

 

Liquidity and Capital Resources

 

As of December
31, 2001, we had cash and cash equivalents of $9.9 million.  Our principal source of liquidity during the
year ended December 31, 2001 consisted of cash from operating activities and
the proceeds from the Offering.  As of
December 31, 2000, we had cash and cash equivalents of $5.0 million.  Our principal source of liquidity during the
year ended December 31, 2000 consisted of borrowings under our original
revolving credit facility which was repaid upon the closing of the Offering,
Cash provided by operating activities was $12.2 million for the year ended
December 31, 2001 as compared to $0.5 million for the year ended December 31,
2000.  The $11,7 million increase was
due primarily to the timing of payments of management fees to shareholders as
well as the impact of higher net income and non-cash depreciation for the year
ended December 31, 2001.

 

Cash used in
investing activities for the years ended December 31, 2001 and 2000 was $111.8
million and $17.1 million, respectively. 
The $94.7 million increase in cash used for investing activities was due
to the $105.0 million stock purchase transaction consummated on December
19,2001 offset partially by a $10.3 million decrease in capital expenditures
due to the capital expenditures made in 2000 for the Island Room expansion.

 

Cash provided
by financing activities for the year ended December 31, 2001 and December 31,
2000 was $104.5 million and $14.2 million, respectively.  The $90.3 million increase in cash provided
by financing activities was due primarily to the $125.0 million in proceeds
from the Offering offset partially by the June 30, 2000 closing of our original
revolving credit facility.  At the time
of the closing of the original revolving credit facility, we borrowed $16.5
million which was reduced to $14.5 million by December 31, 2000. During 2001,
we made further repayments of $2.5 million against the original revolving
credit facility reducing the balance to $12.0 million. We repaid the remaining
$12.0 million balance of the original revolving credit facility from a portion
of the net proceeds from the Offering. The increase in cash provided by
financing activities was offset further by $5.9 million in debt issuance costs
relating to the Offering and the new $40.0 million revolving credit facility.  We had no debt outstanding during the fiscal
year ended December 31, 1999.

 

We used part
of the proceeds from the Offering to purchase all of the shares of our common
stock owned by WHX Entertainment Corp. Of the $105.0 million total
consideration paid for the repurchase, $90.0 million is attributable to the
purchase price for the shares and $150.0 million is attributable to a
non-compete agreement entered into WHX. 
As a result of the stock purchase, the management services agreements
with WHX and Sportsystems Corporation terminated and we no longer incur
management and administrative services fee expenses under such agreements.  We have entered into an administrative
services agreement with Sportsystems and Delaware North, which became effective
upon the closing of the Offering. Pursuant to this administrative services
agreement, Sportsystems receives an annual administrative services fee that is
equal to the greater of 1.5% of preceding year total operating revenues or $1.2
million for certain administrative support services provided to us by
Sportsystems and Delaware North.  In
addition, at the closing of the Offering we paid a one-time advisory fee of
$1.3 million to Delaware North, pursuant to an advisory services agreement, for
advisory services provided in connection with the negotiation, structuring and
financing of the stock purchase transaction.

 

Simultaneously
with the consummation of the Offering, we entered into a new revolving credit
facility.  The total commitment under
the new revolving credit facility is $40.0 million.  As of the date of this prospectus, we have approximately $37.3
million available to be drawn down under the new revolving credit facility, non
of which has been drawn down.  The
stated maturity date of the new revolving credit facility, none of which has
been drawn down.  The stated maturity
date of the new revolving credit 
facility is five years from the closing, and commencing on December 31,
2003, the commitment will be reduced by $2.5 million at the end of each quarter
until the commitment is reduced to $20.0 million.  The new revolving credit facility is secured by all of our
assets, including a first mortgage on our property, and is guaranteed by our
wholly owned subsidiaries.  See the
section “Description of Certain Indebtedness.”

 

ATTACHMENT VI

 

 

WHEELING DOWNS GAMING CENTER

OWNER BUDGETED ITEMS

7/17/02

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  BUDGET AS
  OF:

  	
   

  
	
  #

  	
   

  	
  ITEM

  	
   

  	
  OWNER

  	
   

  	
  8/20/01

  	
   

  	
  9/10/01

  	
   

  	
  10/28/01

  	
   

  	
  11/28/01

  	
   

  	
  3/13/02

  	
   

  
	
  1

  	
   

  	
  Artwork

  	
   

  	
  SC

  	
   

  	
  25,000

  	
   

  	
  25,000

  	
   

  	
  25,000

  	
   

  	
  25,000

  	
   

  	
  25,000

  	
   

  
	
  2

  	
   

  	
  Banquet/Meeting Rooms

  	
   

  	
  RO

  	
   

  	
  300,000

  	
   

  	
  150,000

  	
   

  	
  150,000

  	
   

  	
  100,000

  	
   

  	
  100,000

  	
   

  
	
  3

  	
   

  	
  Bar Equipment

  	
   

  	
  MS

  	
   

  	
  120,000

  	
   

  	
  120,000

  	
   

  	
  120,000

  	
   

  	
  100,000

  	
   

  	
  119,950

  	
   

  
	
  4

  	
   

  	
  Bar Furniture

  	
   

  	
  MS

  	
   

  	
  75,000

  	
   

  	
  125,000

  	
   

  	
  125,000

  	
   

  	
  100,000

  	
   

  	
  31,700

  	
   

  
	
  5

  	
   

  	
  Bar Smallwares

  	
   

  	
  MS

  	
   

  	
  10,000

  	
   

  	
  10,000

  	
   

  	
  10,000

  	
   

  	
  10,000

  	
   

  	
  10,000

  	
   

  
	
  6

  	
   

  	
  Bus Lobby Furniture

  	
   

  	
  RO

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  10,000

  	
   

  
	
  7

  	
   

  	
  Cage Equipment

  	
   

  	
  SC

  	
   

  	
  130,750

  	
   

  	
  130,750

  	
   

  	
  130,750

  	
   

  	
  130,750

  	
   

  	
  130,750

  	
   

  
	
  8

  	
   

  	
  Conference Rooms

  	
   

  	
  RO

  	
   

  	
  35,000

  	
   

  	
  35,000

  	
   

  	
  35,000

  	
   

  	
  0

  	
   

  	
  0

  	
   

  
	
  9

  	
   

  	
  Drapes, Linens, etc.

  	
   

  	
  RO

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  151,000

  	
   

  
	
  10

  	
   

  	
  Exercise Equipment

  	
   

  	
  RO

  	
   

  	
   

  	
   

  	
  25,000

  	
   

  	
  25,000

  	
   

  	
  0

  	
   

  	
  25,000

  	
   

  
	
  11

  	
   

  	
  Foodservice Equipment

  	
   

  	
  MS

  	
   

  	
  656,790

  	
   

  	
  656,790

  	
   

  	
  656,790

  	
   

  	
  425,000

  	
   

  	
  700,195

  	
   

  
	
  12

  	
   

  	
  Foodservice Furniture

  	
   

  	
  MS

  	
   

  	
  143,750

  	
   

  	
  143,750

  	
   

  	
  143,750

  	
   

  	
  100,000

  	
   

  	
  110,350

  	
   

  
	
  13

  	
   

  	
  Foodservice Installation

  	
   

  	
  RO

  	
   

  	
  216,831

  	
   

  	
  218,831

  	
   

  	
  218,831

  	
   

  	
  125,000

  	
   

  	
  164,000

  	
   

  
	
  14

  	
   

  	
  Foodservice Smallwares

  	
   

  	
  MS

  	
   

  	
  150,000

  	
   

  	
  150,000

  	
   

  	
  150,000

  	
   

  	
  100,000

  	
   

  	
  100,000

  	
   

  
	
  15

  	
   

  	
  Freight

  	
   

  	
  MS

  	
   

  	
  101,188

  	
   

  	
  51,188

  	
   

  	
  51,188

  	
   

  	
  30,000

  	
   

  	
  In Each Item

  	
   

  
	
  16

  	
   

  	
  Hotel Equipment

  	
   

  	
  RO

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17

  	
   

  	
  Hotel Furniture

  	
   

  	
  MS

  	
   

  	
  1,196,800

  	
   

  	
  1,048,800

  	
   

  	
  1,048,800

  	
   

  	
  1,046,800

  	
   

  	
  397,640

  	
   

  
	
  18

  	
   

  	
  Hotel Furniture Installation

  	
   

  	
  RO

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  105,700

  	
   

  
	
  19

  	
   

  	
  Hotel Smallwares

  	
   

  	
  MS

  	
   

  	
  In Furniture

  	
   

  	
  In Furniture

  	
   

  	
  In Furniture

  	
   

  	
  In Furniture

  	
   

  	
  In Furniture

  	
   

  
	
  20

  	
   

  	
  Housekeeping Equipment

  	
   

  	
  SC

  	
   

  	
  15,000

  	
   

  	
  15,000

  	
   

  	
  15,000

  	
   

  	
  15,000

  	
   

  	
  15,000

  	
   

  
	
  21

  	
   

  	
  IT systems

  	
   

  	
  WC

  	
   

  	
  2,126,890

  	
   

  	
  1,126,890

  	
   

  	
  1,452,122

  	
   

  	
  1,052,122

  	
   

  	
  1,241,200

  	
   

  
	
  22

  	
   

  	
  Man lift

  	
   

  	
  RO

  	
   

  	
  15,000

  	
   

  	
  16,000

  	
   

  	
  16,000

  	
   

  	
  16,000

  	
   

  	
  16,000

  	
   

  
	
  23

  	
   

  	
  Misc. Gaming Equipment

  	
   

  	
  SC

  	
   

  	
  200,000

  	
   

  	
  2,00,000

  	
   

  	
  200,000

  	
   

  	
  100,000

  	
   

  	
  100,000

  	
   

  
	
  24

  	
   

  	
  Office Equipment

  	
   

  	
  RO

  	
   

  	
  89,445

  	
   

  	
  89,445

  	
   

  	
  88,770

  	
   

  	
  68,770

  	
   

  	
  72,184

  	
   

  
	
  25

  	
   

  	
  Office Furniture

  	
   

  	
  RO

  	
   

  	
  188,000

  	
   

  	
  178,700

  	
   

  	
  178,700

  	
   

  	
  53,700

  	
   

  	
  173,800

  	
   

  
	
  26

  	
   

  	
  POS System

  	
   

  	
  WC

  	
   

  	
  166,827

  	
   

  	
  125,827

  	
   

  	
  125,727

  	
   

  	
  125,727

  	
   

  	
  134,527

  	
   

  
	
  27

  	
   

  	
  Public Address/Sound System

  	
   

  	
  RO

  	
   

  	
  93,376

  	
   

  	
  93,376

  	
   

  	
  93,376

  	
   

  	
  93,376

  	
   

  	
  93,378

  	
   

  
	
  28

  	
   

  	
  Retail Fixturing

  	
   

  	
  RO

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  50,000

  	
   

  
	
  29

  	
   

  	
  Satellite System Rework

  	
   

  	
  WC

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  30,000

  	
   

  
	
  30

  	
   

  	
  Security Systems

  	
   

  	
  MF

  	
   

  	
  1,974,123

  	
   

  	
  1,500,000

  	
   

  	
  1,500,000

  	
   

  	
  1,100,000

  	
   

  	
  1,292,152

  	
   

  
	
  31

  	
   

  	
  Signage

  	
   

  	
  SC

  	
   

  	
  250,000

  	
   

  	
  250,000

  	
   

  	
  250,000

  	
   

  	
  200,000

  	
   

  	
  200,000

  	
   

  
	
  32

  	
   

  	
  Slot Machines

  	
   

  	
  SC

  	
   

  	
  10,270,000

  	
   

  	
  10,270,000

  	
   

  	
  10,270,000

  	
   

  	
  7,000,000

  	
   

  	
  5,500,000

  	
   

  
	
  33

  	
   

  	
  Spending through 8-20-01

  	
   

  	
  RO

  	
   

  	
  397,811

  	
   

  	
  397,911

  	
   

  	
  397,911

  	
   

  	
  397,911

  	
   

  	
  397,917

  	
   

  
	
  34

  	
   

  	
  Stage Equipment

  	
   

  	
  SC

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  300,000

  	
   

  
	
  35

  	
   

  	
  Telephone System

  	
   

  	
  WC

  	
   

  	
  262,175

  	
   

  	
  97,500

  	
   

  	
  122,720

  	
   

  	
  122,720

  	
   

  	
  158,595

  	
   

  
	
  36

  	
   

  	
  Temporary Relocations

  	
   

  	
  SC

  	
   

  	
  50,000

  	
   

  	
  50,000

  	
   

  	
  50,000

  	
   

  	
  50,000

  	
   

  	
  50,000

  	
   

  
	
  37

  	
   

  	
  TV/Video Systems

  	
   

  	
  WC

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  160,500

  	
   

  
	
  38

  	
   

  	
  TOTAL BUDGETED ITEMS

  	
   

  	
   

  	
   

  	
  $

  	
  19,260,856

  	
   

  	
  $

  	
  17,296,758

  	
   

  	
  $

  	
  17,626,835

  	
   

  	
  $

  	
  12,687,876

  	
   

  	
  $

  	
  12,188,530

  	
   

  
																						

 

ATTACHMENT VII

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00049-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00049-of-00352.parquet"}]]