Document:

Exhibit 10.2

 

AGREEMENT
BETWEEN

OWNER AND DESIGN BUILDER

 

THIS
AGREEMENT

 

made as of this 5th day of April in the year
of 2005.

 

BETWEEN the Owner:

 

Great Plains Ethanol, LLC

27716 – 462nd
Avenue

Chancellor, SD 57015

 

And the Design Builder:

 

Broin
and Associates, Inc.

2209 East 57th
Street North

Sioux Falls, SD 57104

 

For the following Project:

 

Project X upgrades including
two new fermenters

Environmental and efficiency
controls

 

The Owner and Design
Builder, in consideration of the mutual covenants hereinafter set forth, agree
as follows:

 

ARTICLE I
— GENERAL PROVISIONS

 

1.1                                BASIC DEFINITIONS

 

1.1.1        The
Contract Documents consist of this Agreement, the Design Builder’s Exhibits and
written addenda identified in Article 14, the Construction Documents approved
by the Owner and Modifications issued after execution of this Agreement A
Modification is a Change Order or a written amendment to this Agreement signed
by both parties, or a Construction Change Directive issued by the Owner in
accordance with Paragraph 8.3.

 

1.1.2        The term “Work” means the construction
and services provided by the Design Builder to fulfill the Design Builder’s
obligations.

 

 

1.2                                  EXECUTIONS, CORRELATION AND
INTENT

 

1.2.1.       It is the intent of
the Owner and Design Builder that the Contract Documents include all items
necessary for proper execution and completion of the Work. The Contract
Documents are complimentary, and what is required by one shall be as binding as
if required by all; performance by the Design Builder shall be required only to
the extent consistent with and reasonably inferable from the Contract Documents
as being necessary to produce the intended results. Words that have well-known
technical or construction industry meanings are used in the Contract Documents
in accordance with such recognized meanings.

 

1.2.2        If the Design Builder believes or is
advised by another design professional retained by the Design Builder to
provide services on the Project that implementation of any instruction received
from the Owner would cause a violation of any applicable law, the Design
Builder shall notify the Owner in writing. Neither the Design Builder nor
another design professional retained by the Design Builder shall be obligated
to perform any act which either believes will violate any applicable law.

 

1.2.3        Nothing contained in this Agreement
shall create a contractual relationship between the Owner and any person or
entity other than the Design Builder.

 

1.3                                OWNERSHIP AND USE OF
DOCUMENTS

 

1.3.1        Drawings, specifications, and other documents
and electronic data furnished by the Design Builder and other design
professionals retained by the Design Builder, are instruments of service. The
Design Builder and other providers of professional services shall retain all
common law, statutory and other reserved rights, including copyright in those
instruments of service furnished by them. Drawings, specifications, and other
documents and electronic data are furnished for use solely with respect to this
Agreement. The Owner shall be permitted to retain copies, including
reproducible copies, of the drawings, specifications, and other documents and
electronic data furnished by the Design Builder for information and reference
in connection with the Project except as provided in Subparagraphs 1.3.2 and
1.3.3.

 

1.3.2        Drawings, specifications, and other
documents and electronic data furnished by the Design Builder shall not be used
by the Owner or others on other projects, for additions to this Project or for
completion of this Project by others, except by agreement in writing and with
appropriate compensation to the Design Builder.

 

2

 

1.3.3        Submission or distribution of the Design
Builder’s documents to meet official regulatory requirements or for similar
purposes in connection with the Project is not to be construed as publication
in derogation of the rights reserved in Subparagraph 1.3.1.

 

ARTICLE 2
- OWNER

 

2.1                                The Owner shall designate a representative
authorized to act on the Owner’s behalf with respect to the Project. The Owner
or such authorized representative shall examine documents submitted by the
Design Builder and shall render decisions in a timely manner and in accordance
with the schedule accepted by the Owner. The Owner may obtain independent
review of the Contract Documents by a separate architect, engineer, contractor,
or cost estimator under contract to or employed by the Owner. Such independent
review shall be undertaken at the Owner’s expense in a timely manner and shall
not delay the orderly progress of the Work.

 

2.2                                The Owner shall cooperate with the Design
Builder in securing building and other permits, licenses and inspections. The
Owner shall not be required to pay the fees for such permits, licenses and
inspections unless the cost of such fees is excluded from the Design Builder’s
Scope of Services.

 

2.3                                The Owner shall disclose, to the extent known
to the Owner, the results and reports of prior tests, inspections or
investigations conducted for the Project involving: structural or mechanical
systems; chemical; air and water pollution; hazardous materials; or other
environmental and subsurface conditions. The Owner shall disclose all
information known to the Owner regarding the presence of pollutants at the
Project’s site.

 

2.4                                The Owner shall furnish all legal, accounting
and insurance counseling services as may be necessary at any time for the
Project, including such auditing services as the Owner may require to verify the Design Builder’s Applications for Payment.

 

2.5                                Those services, information, surveys and
reports required by Paragraphs 2.3 and 2.4 which are within the Owner’s control
shall be furnished at the Owner’s expense. The Design Builder shall be entitled
to rely upon the accuracy and completeness thereof, except to the extent the
Owner advises the Design Builder to the contrary in writing.

 

2.6                                If the Owner requires the Design Builder to
maintain any special insurance coverage, policy, amendment, or rider, the Owner
shall pay the additional cost thereof, except as otherwise stipulated in this
Agreement.

 

3

 

2.7                                If the Owner observes or otherwise becomes
aware of a fault of defect in the Work or nonconformity with the Design Builder’s
Scope of Services or the Construction Documents, the Owner shall give prompt
written notice thereof to the Design Builder.

 

2.8                                The Owner shall promptly upon the request of
the Design Builder, furnish to the Design Builder reasonable evidence that
financial arrangements have been made to fulfill the Owner’s obligations under
the Contract.

 

2.9                                The Owner shall communicate with persons or
entities employed or retained by the Design Builder through the Design Builder,
unless otherwise directed by the Design Builder.

 

 

ARTICLE 3—
DESIGN BUILDER

 

3.1                                SERVICES AND
RESPONSIBILITIES

 

3.1.1        Standard of Care: Design Builder shall
perform or furnish Design Professional Services and related services in all
phases of the project. The standard of care for all such services performed or
furnished under this Agreement will be the care and skill ordinarily used by
members of the engineering profession practicing under similar conditions at
the same time and locality.

 

3.1.2        The Design Builder shall be responsible
to the Owner for acts and omissions of the Design Builder’s employees,
subcontractors and their agents and employees, and other persons, including
other design professionals, performing any portion of the Design Builder’s
obligations under this Agreement.

 

3.2                                BASIC SERVICES

 

3.2.1        The Design Builder’s Basic Services are
described below and in Article 14.

 

3.2.2        The Design Builder shall designate a
representative authorized to act on the Design Builder’s behalf with respect to
the Project.

 

3.2.3        The Design Builder, with the assistance
of the Owner, shall file documents required to obtain necessary approvals of
governmental authorities having jurisdiction over the Project.

 

3.2.4                        Unless otherwise provided in the Contract
Documents, the Design Builder

 

4

 

shall
provide or cause to be provided and shall pay for design services, 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.

 

3.2.5        Design Builder shall supervise, inspect
and direct the Construction competently and efficiently, devoting such
attention thereto and applying such skills and expertise as may be necessary to
provide the Construction in accordance with the Contract Documents. Design
Builder shall be solely responsible for the means, methods, techniques,
sequences and procedures employed for the provision of Construction. Design
Builder shall be responsible to see that the complete Construction complies
accurately with the Contract Documents and shall keep Owner advised as to the
quality and progress of the Construction.

 

3.2.5        The Design Builder shall keep the Owner
informed of the progress and quality of the Work.

 

3.2.7        The Design Builder shall be responsible
for correcting Work which does not conform to the Contract Documents.

 

3.2.B
The Design Builder warrants to the Owner that materials and equipment furnished
under the Contract will be of good quality and new unless otherwise required or
permitted by the Contract Documents, that the construction will be free from
faults and defects, and that the construction will conform with the
requirements of the Contract Documents. Construction not conforming to these
requirements, including substitutions not properly approved by the Owner, shall
be corrected in accordance with Article 9.

 

3.2.9        The Design Builder shall pay all state
sales, consumer, use and similar taxes which had been legally enacted prior to
the date of this Agreement, and shall secure and pay for building and other
permits and governmental fees, licenses and inspections necessary for the
proper execution and completion of the Work which are either customarily
secured after execution of a contract for construction or are legally required
prior to the date of this Agreement.

 

3.2.10      Laws and Regulations

 

1.     Design Builder shall give all notices and
comply with all Laws and Regulations of the place of the Project which are
applicable to furnishing and performance of the Work. Except where otherwise
expressly required

 

5

 

by
applicable Laws and Regulations, Owner shall not be responsible for monitoring
Design Builder’s compliance with any Laws or Regulations.

 

2.     If Design Builder performs any Work knowing
or having reason to know that it is contrary to Laws or Regulations, Design
Builder shall bear all costs arising therefrom.

 

3.     Changes in Laws and Regulations not known
or foreseeable on the date of receipt of Proposals having an effect on the cost
or time of performance may be the subject of a claim under Article B.

 

3.2.11      Design Builder shall pay all license fees
and royalties and assume all costs incident to the use in the performance of
the Work or the incorporation in the Work of any invention, design, process,
product or device which is subject of patent rights or copyrights held by
others. If a particular invention, design, process, product
or device is specified in the Conceptual Documents for use in the performance
of the. Construction and if to the actual knowledge of Owner its use is
subject to patent rights or copyrights calling for the payment of any license
fee or royalty to others, the existence of such rights shall be disclosed by
Owner in the Conceptual Documents. To the fullest extent permitted by Laws and
Regulations, Design Builder shall indemnify and hold harmless Owner, from and
against all claims, costs, losses and damages (including but not limited to all
fees and charges of engineers, architects, attorneys and other professionals
and all court or arbitration or other dispute resolution costs) arising out of
or resulting from any infringement of patent rights or copyrights incident to the
use in the performance of the Work or resulting from the incorporation in the
Work of any invention, design, process, product or device not specified in the
Conceptual Documents.

 

3.2.12      Use of Site and Other Areas

 

1.     Design Builder shall confine construction
equipment, the storage of materials and equipment and the operations of
construction workers to those lands and areas permitted by the Owner and other
land and areas permitted by Laws and Regulations, rights-of-way, permits and
easements, and shall not unreasonably encumber the premises with construction
equipment or other materials or equipment. Design Builder shall assume full
responsibility for any damage to any such land or area, or to the owner or
occupant thereof or of any adjacent land or areas, resulting from the
performance of the Construction. Should any claim be made by any such owner or
occupant because of the performance of the Construction, Design Builder shall
promptly settle with such other party by negotiation or otherwise resolve the
claim by arbitration or other dispute resolution proceeding or at law. Design
Builder shall, to the fullest extent permitted

 

6

 

by
Laws and Regulations, indemnify and hold harmless Owner, Owner’s Consultants
and anyone directly or indirectly employed by any of them from and against all
claims, costs, losses and damages (including, but not limited to, fees of
engineers, architects, attorneys and other professionals and court and
arbitration or other dispute resolution costs) arising out of or resulting from
any claim or action, legal or equitable, brought by any such owner or occupant
against Owner, or any other party indemnified hereunder to the extent caused by
or based upon Design Builder’s performance of the Construction.

 

2.     During the performance of the Construction,
Design Builder shall keep the premises free from accumulations of waste
materials, rubbish and other debris resulting from the Construction. At the
completion of the Construction Design Builder shall remove all waste materials,
rubbish and debris from and about the premises as well as all tools,
appliances, construction equipment, temporary construction and machinery and
surplus materials. Design Builder shall leave the Site clean and ready for
occupancy by Owner at Substantial Completion. Design Builder shall restore to
original condition all property not designated for alteration by the Contract
Documents.

 

3.     Design Builder shall not load nor permit
any part of any structure to be loaded in any manner that will endanger the
structure, nor shall Design Builder subject any part of the Work or adjacent
property to stresses or pressures that will endanger it.

 

3.2.13      The Design Builder shall notify the Owner
when the Design Builder believes that the Work or an agreed upon portion
thereof is substantially completed. If the Owner concurs, the Design Builder
shall issue a Certificate of Substantial Completion which shall establish the
Date of Substantial Completion, shall state the responsibility of each party
for security, maintenance, heat, utilities, damage to the Work and insurance,
shall include a list of items to be completed or corrected and shall fix the
time within which the Design Builder shall complete items listed therein.
Disputes between the Owner and Design Builder regarding the Certificate of
Substantial Completion shall be resolved in accordance with provisions of Article 10.

 

3.2.14      The Design Builder shall maintain at the
site for the Owner one record copy of the drawings, specifications, product
data, samples, shop drawings, Change Orders and other modifications, in good
order and regularly updated to record the completed construction. These shall
be delivered to the Owner upon completion of construction and prior to final
payment.

 

7

 

3.2.15
Unless otherwise provided in the Contract Documents, Design Builder shall
directly or through one or more Subcontractors obtain and pay for all permits
and licenses necessary for construction. Owner shall assist Design Builder,
when necessary, in obtaining such permits and licenses. Design Builder shall
pay all governmental charges and inspection fees necessary for the prosecution
of the Construction, which are applicable on the date of this Agreement. The
Owner is responsible for paying any and all utility company connection charges
and/or capital costs related thereto.

 

3.2.16      Design Builder’s General Warranty and
Guarantee

 

1.     Design Builder warrants and guarantees to
Owner that all Construction will be in accordance with the Contract Documents
and will not be defective. This warranty shall be effective for a period of
twelve months from the date of substantial completion and will cover all labor
and materials to correct any deficiencies. Design Builder’s warranty and
guarantee hereunder excludes defects or damage caused by:

 

a.               Abuse, modification or improper maintenance
or operation by persons other than Design/Builder, Subcontractors or Suppliers;
or

 

b.              Normal wear and tear under normal usage.

 

2.     Design Builder’s obligation to perform and
complete the Work in accordance with the Contract Documents shall be absolute. None of the following will constitute an acceptance of Work that is
not in accordance with the Contract Documents or a release of Design Builder’s
obligation to perform the Work in accordance with the Contract

Documents:

 

a.               Observations by Owner;

 

b.              The making of any progress or final payment;

 

c.               The issuance of a certificate of Substantial
Completion;

 

d.              Use or occupancy of the Work or any part
thereof by Owner;

 

e.               Any acceptance by Owner or any failure to do
so;

 

f.                 Any review and approval of a Submittal;

 

g.              Any inspection, test or approval by others;
or

 

8

 

h.              Any correction of defective Construction by Owner

 

3.2.17      Operational
Phase: During the Operations Phase, Design Builder shall:

 

1.     Provide assistance in connection with the
start-up, testing, refining and adjusting of any equipment or system.

 

2.     Assist Owner in training staff to operate
and maintain the Project.

 

3.     Assist Owner in developing
systems and procedures for control of the operation and maintenance of and
record keeping for the Project.

 

3.3             ADDITIONAL SERVICES

 

3.3.1        The services described in this Paragraph
3.3 are not included in Basic Services unless so identified in Article 14,
and they shall be paid for by the Owner as provided in this Agreement, in
addition to the compensation for Basic Services. The services described in this
Paragraph 3.3 shall be provided only if authorized or confirmed in writing by
the Owner.

 

3.3.2        Making revisions in drawings,
specifications, and other documents or electronic data when such revisions are
required by the enactment or revision of codes, laws or regulations subsequent
to the preparation of such documents or electronic data.

 

3.3.3        Providing consultation concerning
replacement of Work damaged by fire or other cause during construction, and
furnishing services required in connection with the replacement of such Work.

 

3.3.4        Providing services in connection with a
public hearing, arbitration proceeding or legal proceeding, except where the
Design Builder is a party thereto.

 

3.3.5        Providing coordination of construction
performed by the Owner’s own forces or separate contractors employed by the
Owner, and coordination of services required in connection with construction
performed and equipment supplied by Owner.

 

3.3.6        Submitting Construction Documents for
review and approval by the Owner. Construction Documents may include drawings,
specifications, and other documents and electronic data setting forth in detail
the requirements for construction of the Work.

 

9

 

3.3.7        Preparing a set of reproducible record
documents or electronic data showing significant changes in the Work made
during construction.

 

3.3.8        Providing additional assistance for
training personnel, preparing manuals or consulting during operation outside of
the Scope of Basic Services.

 

ARTICLE 4
- TIME

 

4.1                                Unless otherwise indicated, the Owner and the
Design Builder shall perform their respective obligations as expeditiously as
is consistent with reasonable skill and care and the orderly progress of the
Project.

 

4.2                                Time limits stated in the Contract Documents
are of the essence. The Work to be performed under this Agreement shall
commence upon receipt of a Notice To Proceed unless
otherwise agreed and, subject to authorized Modifications, Substantial
Completion shall be achieved on or before the date established in Article 14.

 

4.3                                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 the Owner
ban occupy or utilize the Work for its intended use.

 

4.4                                Based on the Design Builder’s Scope of
Services, a construction schedule shall be provided consistent with
Paragraph 4.2 above.

 

4.5                                If the Design Builder is delayed at any time in the progress of the
Work by an act or neglect of the Owner, Owner’s employees, or separate
contractors employed by the Owner, or by changes ordered in the Work, or by
labor disputes, fire, unusual delay in deliveries, adverse weather conditions
not reasonably anticipatable, unavoidable casualties or other causes beyond the
Design Builder’s control, or by delay authorized by the Owner pending
arbitration, or by other causes which the Owner and Design Builder agree may
justify delay, then Contract Time shall be reasonably extended by Change Order.

 

ARTICLE 5
- PAYMENTS

 

5.1                                PROGRESS PAYMENTS

 

5.1.1        The Design Builder shell
deliver to the Owner itemized Applications for Payment in such detail as
indicated in Article 14.

 

10

 

5.1.1.1     Application shall be made on AlA forms G702
and G703 or similar documents. Two percent retainage shall be held by the owner
on up to fifty percent value of the original contract value after which no
additional retainage will be held.

 

5.1.2        Within ten (10) days of the Owner’s
receipt of a properly submitted and correct -Application for Payment, the Owner
shall make payment to the Design Builder.

 

5.1.3        The Application for Payment shall
constitute a representation by the Design Builder to the - Owner that the
design and construction have progressed to the point indicated; the quality of
Work covered by the application is in accordance with the Contract Documents;
end the Design Builder is entitled to payment in the amount requested.

 

5.1.4        Upon receipt of payment from the Owner,
the Design Builder shall promptly pay the other design professionals
end each contractor the amount to which each is entitled in accordance with the
terms of their respective contracts.

 

5.1.5        The Owner shall have no obligation under
this Agreement to pay or to be responsible in any way for payment to another
design professional, or a contractor performing portions of the Work.

 

5.1.6        Neither progress payment nor partial or
entire use or occupancy of the Project by the Owner shall constitute acceptance
of Work not in accordance with the Contract Documents.

 

5.1.7        The Design Builder warrants that title
to all construction covered by an Application for Payment will pass to the
Owner no later than the time of payment. The Design Builder further warrants
that upon submittal of an Application for Payment all construction for which
payments have been received from the Owner shall be free and clear of liens,
claims, security interests or encumbrances in favor of the Design Builder or
any other person or entity performing construction at the site or furnishing
materials or equipment relating to the construction.

 

5.1.8        Upon substantial completion, the Owner
shall pay the Design Builder the retainage, if any, less the reasonable cost to
correct or complete incorrect or incomplete Work. Final payment of such
withheld sum shall be made upon correction or completion of such Work.

 

11

 

5.2.         FINAL PAYMENT

 

5.2.1        When the Work has been completed and the
contract fully performed, the Design Builder shall submit a final application
for payment to the Owner, who shall make final payment within ten (10) days
of receipt.

 

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

 

5.2.2.1     liens, claims,
security interests or encumbrances arising out of the Contract and unsettled;

 

5.2.2.2     failure
of the Work to comply with the requirements of the Contract Documents; or

 

5.2.2.3     terms of special
warranties required by the Contract Documents

 

5.2.3        Acceptance of final payment shell
constitute a waiver of all claims by the Design Builder except those previously
made in writing and identified by the Design Builder as unsettled at the time
of final Application for Payment.

 

5.3
INTEREST PAYMENTS

 

5.3.1        Payments due to the Design Builder under
this Agreement which are not paid when due shall bear interest from the date
due at the rate specified in Article 13, or in the absence of a specified
rate, at the legal rate prevailing where the Project is located.

 

ARTICLE 6
- PROTECTION OF PERSONS AND PROPERTY

 

6.1           The
Design Builder shall be responsible for initiating, maintaining and providing
supervision of safety precautions and programs in connection with the
performance of this Agreement.

 

6.2           The Design Builder shall take reasonable precautions for
the safety of, end shell 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 end materials and equipment to be
incorporated therein, whether in storage on or off the site, under care,
custody, or control of the Design Builder or the Design Builder’s contractors;
and (3) other property at 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.

 

12

 

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

 

6.4           The Design Builder shall promptly remedy damage and loss
(other than damage or loss insured under property insurance provided or
required by the Contract Documents) to property at the site caused in whole or
in part by the Design Builder, a contractor of the Design Builder or anyone
directly or indirectly employed by any of them, or by anyone for whose acts
they may be liable.

 

ARTICLE 7
- INSURANCE AND BONDS

 

7.1          PERFORMANCE, PAYMENT AND OTHER BONDS

 

7.1.1        If it is required by the Primary Lender,
Design Builder shall furnish performance and payment Bonds, each in an amount
at least equal to the Contract Price as security for the faithful performance
and payment of all Design Builder’s obligations to furnish, provide and pay for
Construction and related materials under the Contract Documents. These Bonds
shall remain in effect at least until one year after the date when final
payment becomes due, except as provided otherwise by Laws or Regulations or by
the Contract Documents. Design Builder shall also furnish such other Bonds as
are required by Article 14. All Bonds shall be in the form prescribed by
the Contract Documents except as provided otherwise by Laws or Regulations, and
shall be executed by such sureties as are named in the current list of “Companies
Holding Certificates of Authority as Acceptable Surety Companies” as published
in Circular 570 (amended) by the Audit Staff, Bureau of Government Financial
Operations, U.S. Treasury Department. All Bonds signed by en agent must be
accompanied by a certified copy of such agent’s authority to act. The cost of
the performance and payment bonds shall be paid by the Owner.

 

7.1.2        If the surety on any Bond furnished by
Design Builder is declared bankrupt or becomes insolvent or its right to do
business is terminated in any state where any part of the Project is located or
it ceases to meet the requirements of paragraph 7.1.1, Design Builder shall
within thirty days thereafter substitute another Bond and surety meeting the
requirements of paragraphs 7.1.1 and 7.9.

 

7.2          DESIGNIBUILDER’S LIABILITY INSURANCE

 

7.2.1        The Design Builder 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 Owner and Design Builder

 

13

 

from
claims set forth below which may arise out of or result from operations under
this Agreement by the Design Builder.

 

7.2.1.1     Claims under workers’ compensation,
disability benefits end other similar employee benefit acts;

 

7.2.1.2     Claims for damages because of bodily
injury, occupational sickness or disease, or death of Design Builder’s
employees; -

 

7.2.1.3     Claims for damages because of bodily
injury, sickness or disease, or death of any person other than Design Builder’s
employees;

 

7.2.1.4     Claims for damages insured by customary
personal injury liability coverage which are sustained (i) by any person
as a result of an offense directly or indirectly related to the employment of
such person by Design Builder, or (ii) by any other person for any other
reason;

 

7.2.1.5     Claims for damages, other than to the Work
itself, because of injury to or destruction of tangible property wherever
located, including loss of use resulting therefrom; and

 

7.2.1.6     Claims for damages because of bodily injury
or death of any person or property damage arising out of the ownership,
maintenance or use of any motor vehicle.

 

7.2.2        The policies of insurance required by
paragraph 7.2.1 shall:

 

7.2.2.1     With respect to insurance required by
paragraphs 7.2.1.3 through 7.2.1.6 inclusive, include as additional insureds
Owner and any other persons or entities Indicated in Article 14, all of
whom shall be listed as additional insureds, and include coverage for the
respective officers and employees of all such additional insureds;

 

7.2.2.2     Include at least the specific coverages and
be written for not less than the limits of liability provided in 7.2,2.2.a
through 7.2.2.2.c or required by Laws or Regulations, whichever is greater;

 

a.            Worker’s Compensation
under Paragraph 7.2.1.1 of the General Conditions:

 

	
  1.

  	
   

  	
  State:

  	
   

  	
  Statutory

  
	
  2.

  	
   

  	
  Applicable Federal:

  	
   

  	
  Statutory

  
	
  3.

  	
   

  	
  Employer’s Liability:

  	
   

  	
  $500,000

  

 

14

 

b.              Design Builder’s General Liability (under
paragraphs 7.2.1.2 through 7.2.1.6) which shall include completed operations
and product liability coverages.

 

	
  1.

  	
   

  	
  General Aggregate:

  	
   

  	
   

  
	
   

  	
   

  	
  (Except Products — Completed Operations)

  	
   

  	
  $2,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Products — Completed Operations Aggregate

  	
   

  	
  $2,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Personal and Advertising Injury

  	
   

  	
   

  
	
   

  	
   

  	
  (Per Person/Organization)

  	
   

  	
  $1,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  Each Occurrence

  	
   

  	
   

  
	
   

  	
   

  	
  (Bodily Injury and Property Damages)

  	
   

  	
  $1,000,000

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Property Damage liability insurance will provide
  Explosion,

  
	
   

  	
   

  	
  Collapse and Underground coverages where
  applicable.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  Excess Liability

  	
   

  	
   

  
	
   

  	
   

  	
  General Aggregate

  	
   

  	
  $5,000,000

  
	
   

  	
   

  	
  Each Occurrence

  	
   

  	
  $5,000,000

  

 

	
  c.

  	
   

  	
  Automobile Liability:

  	
   

  	
   

  
	
   

  	
   

  	
  Combine Single

  	
   

  	
   

  
	
   

  	
   

  	
  Limit (Bodily Injury and Property Damage)

  	
   

  	
  $1,000,000

  

 

7.2.2.3
include completed operations insurance;

 

7.2.2.4     Include contractual liability insurance
covering Design Builder’s indemnity obligations under paragraphs 3.2.11, 3.2.12
and 11.4;

 

7.2.2.5
Contain a provision or endorsement that the coverage afforded will not be
canceled until at least 30 days’ prior written notice has been given to Owner
and each other additional insured indicated in Article 14 to whom a
Certificate of Insurance has been issued (and the Certificate of Insurance
furnished by the Design Builder pursuant to paragraph 7.9.2 will so provide);

 

7.2.2.6.
Remain in effect at least until final payment and at all times thereafter when
Design Builder may be correcting, removing or replacing defective Construction in accordance with Article 9;
and

 

15

 

7.2.2.7     With respect to completed operations insurance, and any other insurance coverage written on a
claims-made basis, this insurance shall remain in effect for at least one year
after final payment.

 

7.2.3        Design Builder’s insurance agency shall
agree in writing to give to owner notice of cancellation of insurance by either
party.

 

7.3          OWNER’S LIABILITY INSURANCE

 

7.3.1        The Owner shall be responsible for
purchasing and maintaining the Owner’s General, Auto and Workmen’s Compensation
liability insurance. Optionally, the Owner may purchase and maintain other
insurance for self-protection against claims which may arise from operations
under this Agreement. The Design Builder shall not be responsible for
purchasing and maintaining this optional Owner’s liability insurance unless
specifically required by the Contract Documents.

 

7.4          PROPERTY INSURANCE

 

7.4.1        Unless otherwise provided in Article 14,
Owner shall purchase and maintain property insurance upon the Construction at
the Site in the amount of the full replacement cost thereof (subject to
deductible amounts not exceeding $5000 per occurrence). This insurance will:

 

7.4.1.1
Include the interests of Owner, Design/Builder, Subcontractors, and any other
persons or entities indicated in the Supplementary Conditions, each of whom is
deemed to have an insurable interest end shell be listed as an insured or
additional insured;

 

7.4.1.2     Be written on a Builder’s Risk “all-risk”
or open peril or special causes of loss policy form that shall at least include
insurance for physical loss and damage to the Construction, temporary
buildings, falsework and all materials and equipment in transit, and shall
insure against at least the following perils or causes of loss: fire,
lightning, extended coverage, theft, vandalism and malicious mischief,
collapse, debris removal, demolition occasioned by enforcement of Laws and
Regulations, and such other perils or causes of loss as may be specifically
required by the Supplementary Conditions;

 

7.4.1.3     Include expenses incurred in the repair or
replacement of any insured property (including but not limited to fees and
charges of engineers and design professionals);

 

16

 

7.4.1.4     Be maintained in effect until final payment
is made unless otherwise agreed to in writing by Owner and Design/Builder with
thirty days written notice to each other additional insured to whom a
certificate of insurance has been issued; and

 

7.4.1.5     Allow partial utilization in accordance
with paragraph 7.8.

 

7.4.2        All the policies of insurance (and the
certificates or other evidence thereof) required to be purchased and maintained
by Owner in accordance with paragraph 7.4 will contain a provision or
endorsement that the coverage afforded will not be canceled until at least 30
days’ prior written notice has been given to Design Builder and to each other
additional insured to whom a Certificate of Insurance has been issued and will
contain waiver provisions in accordance with paragraph 7.5.1. In addition, the
insurance agency representing the Owner shall agree in writing to give to
Design Builder notice of cancellation by either party.

 

7.4.3.       Owner shall not be responsible for
purchasing and maintaining any property insurance to protect the interests of
Design Builder, Subcontractors, Supplies, Engineers or others in the Work to
the extent of any deductible amounts. The risk of loss within such identified
deductible amount, will be borne by Design Builder,
Subcontractor or others suffering any such loss and if any of them wishes
property insurance coverage within the limits of such amounts, each may
purchase and maintain it at the purchaser’s own expense.

 

7.5          WAIVER OF RIGHTS

 

7.5.1        Owner and Design Builder intend that all
policies purchased in accordance with paragraph 7.4 will protect Owner, Design
Builder, Engineers, Subcontractors, and all other individuals or entities
indicated in Article 14 to be listed as insured or additional insureds in
such policies and will provide primary coverage for all losses and damages
caused by the perils or causes of loss covered thereby. All such policies shall
contain provisions to the effect that in the event of payment of any loss or
damage the insurers will have no rights of recovery against any of the insureds
or additional insureds thereunder. Owner and Design Builder waive all rights
against each other and their respective officers, directors, employees and
agents for all losses and damages caused by, arising out of or resulting from
any of the perils or causes of loss covered by such policies and any other
property insurance applicable to the Work; and, in addition, waive all such
rights against Subcontractors, Suppliers, Engineers and all other individuals
or entities indicated in the Supplementary Conditions to be listed as insureds
or additional insureds under such policies for losses and damages so caused. None
of the above waivers shall extend to the rights that any party making such
waiver may have to the proceeds of insurance held by Owner as trustee or
otherwise payable under any

 

17

 

policy so
issued. In addition, Owner waives all rights against Design Builder,
Subcontractors, Engineers and Suppliers and the officers, directors, employees
and agents of any of them for business interruption, loss of use of Owner’s
property and any other consequential damages caused by, arising out of or
resulting from any of such insured perils or causes of loss or any other peril
or cause of loss whether or not insured.

 

7.6          RECEIPT AND APPLICATION OF PROCEEDS

 

7.6.1        Any insured loss under the policies of
insurance required by paragraph 7.4 will be adjusted with Owner and made
payable to Owner as fiduciary for the insureds, as their interests may appear,
subject to the requirements of any applicable mortgage clause and of paragraph
7.6.3.

 

7.6.2.       Owner shall deposit in a separate account
any money so received, and shall distribute it in accordance with such
agreement as the parties in interest may reach. If no other special agreement
is reached the damaged Work shall be repaired or replaced, the moneys so
received applied on account thereof and the Work and the cost thereof covered
by an appropriate Change Order or Written Amendment.

 

7.6.3.       Owner as fiduciary
shall have power to adjust and settle any loss with the insurers unless one of
the parties in interest shall object in writing within fifteen days after the
occurrence of loss to Owner’s exercise of this power. If such objection be
made, Owner as fiduciary shall make settlement with the insurers in accordance
with such agreement as the parties in interest may reach, If no such agreement
among the parties in interest is reached, Owner as fiduciary shall adjust and
settle the loss with the insurers and, if required in writing by any party in
interest, Owner as fiduciary shall give bond for the proper performance of such
duties.

 

7.7          ACCEPTANCE OF BONDS AND INSURANCE;
OPTION TO REPLACE

 

7.7.1        If either party has any objection to the
coverage afforded by or other provisions of the Bonds or insurance required to
be purchased and maintained by the other party in accordance with Article 7
on the basis of their not complying with the Contract Documents, the objecting
party shall so notify the other party in writing within ten days after receipt
of the certificates. Owner and Design Builder shall each provide to the other
such additional information in respect of insurance provided as the other may
reasonably request If either party does not purchase or maintain all of the
Bonds and insurance required of such party by the Contract Documents, such party
shall notify the other party in writing of such failure to purchase prior to
the start of the Work, or of such failure to maintain prior to any

 

18

 

change in
the required coverage. Without prejudice to any other right or remedy, the
other party may elect to obtain equivalent Bonds or insurance to protect such
other party’s interests at the expense of the party who was supposed to provide
such coverage, and a Change Order or Written Amendment shall be issued to
adjust the Contract Price accordingly.

 

7.8          PARTIAL UTILIZATION — PROPERTY
INSURANCE

 

7.8.1        If Owner finds it necessary to occupy or
use a portion or portions of the Work prior to Substantial Completion of all
the construction, such use or occupancy may be accomplished; provided that no
such use or occupancy shall commence before the insurers providing the property
insurance have acknowledged notice thereof and in writing effected any changes
in coverage necessitated thereby. The insurers providing the property insurance
shall consent by endorsement on the policy or policies, but the property
insurance shall not be cancelled or permitted to lapse on account of any such
partial use or occupancy.

 

7.9          LICENSED
SURETIES AND INSURERS; CERTIFICATES OF INSURANCE

 

7.9.1        All Bonds and insurance required by the Contract Documents to
be purchased and maintained by Owner or Design Builder shall be obtained from
surety or insurance companies that are duly licensed or authorized in the
jurisdiction in which the Project is located to issue Bonds or insurance
policies for the limits and coverage’s so required. Such surety and insurance
companies shall also meet such additional requirements and qualifications as
may be provided in Article 14.

 

7.9.2     Design Builder shall deliver to Owner, with
copies to each additional insured indicated in Article 14, certificates of
insurance (and other evidence of insurance requested by Owner or any other
additional insured) which Design/Builder is required to purchase and maintain
in accordance with paragraph 7.2.1. Owner shall deliver to Design Builder, with
copies to each additional insured indicated in Article 14, certificates of
insurance (and other evidence of insurance requested by Design Builder or any
other additional insured) which Owner is required to purchase and maintain in
accordance with paragraphs 7.4.1 and 7.4.2.

 

19

 

ARTICLE 8
- CHANGES IN THE WORK

 

8.1 CHANGES

 

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

 

8.1.2                        A Change Order shall be based upon agreement
between the Owner and

the Design
Builder; a Construction Change Directive may be issued by the Owner without the
agreement of the Design Builder; an order for a minor change in the Work may be
issued by the Design Builder alone.

 

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

 

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

 

8.2          CHANGE ORDERS

 

8.2.1     A Change Order is a written instrument
prepared by the Design Builder and signed by the Owner and the Design Builder,
stating their agreement upon all of the following:

 

1.  a 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.

 

8.2.2     If the Owner requests a proposal for a
change in the Work from the Design Builder and subsequently elects not to
proceed with the change, a Change Order shall be issued to reimburse the Design
Builder for any costs incurred for estimating services, design services or
preparation of proposed revisions to the Contract Documents.

 

20

 

8.3          CONSTRUCTION CHANGE DIRECTIVES

 

8.3.1     A Construction Change Directive is a
written order prepared and signed by the Owner, directing a change in the Work prior
to agreement on adjustment, if any, in the Contract Sum or Contract Time, or
both.

 

8.3.2     Except as otherwise agreed by the Owner end
the Design Builder, the adjustment to the Contract Sum shall be determined on
the basis of reasonable expenditures and savings of those performing the Work
attributable to the change, including the expenditures for design services and
revisions to the Contract Documents. In such case, the Design Builder shall
keep and present an itemized accounting together with appropriate supporting
data for inclusion in a Change Order. Unless otherwise provided in the Contract
Documents, costs for these purposes 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 end equipment exclusive of hand tools, whether rented from the Design
Builder or others;

 

4.  costs of premiums for all bonds and insurance
permit fees, and -sales, use or similar taxes;

 

5.  additional
costs of supervision and field office personnel directly attributable to the
change; and fees paid to other design professionals.

 

8.3.3        Pending final determination of cost to
the Owner, amounts not in dispute may be included in Applications for Payment. The
amount of credit to be allowed by the Design Builder to the Owner for deletion
or change which results in a net decrease in the Contract Sum and Contract
Time, such agreement shall be effective immediately and shall be recorded by
preparation and execution of an appropriate Change Order.

 

8.4          MINOR CHANGES IN THE WORK

 

8.4.1        The Design Builder shall have authority
to make minor changes in the Construction Documents and construction consistent
with the intent of the Contract Documents when such minor changes do not
involve adjustment in the Contract Sum or extension of the Contract Time. The
Design Builder shall

 

21

 

promptly
inform the Owner, in writing, of minor changes in the Construction Documents
and construction.

 

8.5          CONCEALED CONDITIONS

 

8.5.1        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 Contract Sum shall be equitably adjusted for
such concealed or unknown conditions by Change Order upon claim by either party
made within 21 days after the claimant becomes aware of the conditions.

 

8.6          REGULATORY CHANGES

 

8.6.1        The Design Builder shall be compensated
for changes in the construction necessitated by the enactment or revisions of
codes, laws or regulations subsequent to the submission of the Design Builder’s
Proposal.

 

ARTICLE 9
- CORRECTION OF WORK

 

9.1                                The Design Builder shall promptly correct
Work rejected by the Owner or known by the Design Builder to be defective or
failing to conform to the requirements of the Contract Documents, whether
observed before or after Substantial Completion and whether or not fabricated,
installed or completed. The Design Builder shall bear costs of correcting such
rejected Work, including additional testing and inspections.

 

9.2                                If, within one (1) year after the date
of Substantial Completion of the Work or, after the date for commencement of
warranties established in a written agreement between the Owner and the Design
Builder, 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 Design Builder shall correct it
promptly after receipt of a written notice from the Owner to do so unless the
Owner has previously given the Design Builder a written acceptance of such
condition.

 

22

 

9.3                                Nothing
contained in this Article 9 shall be construed to establish a period of limitation
with respect to other obligations which the Design/Builder might have under the
Contract Documents. Establishment of the time period of one (1) year as described in Subparagraph 9.2 relates only to
the specific obligation of the Design Builder to correct-the Work, and has no
relationship to the time within which proceedings may be commenced to establish
the Design Builder’s liability with respect to the Design Builder’s obligations
other than specifically to correct the Work.

 

9.4                                If the Design Builder fails to correct
nonconforming Work as required or fails to carry out Work in accordance with
the Contract Documents, the Owner, by written order signed personally or by an
Agent specifically so empowered by the Owner in writing, may order the Design
Builder to stop the Work, or any portion thereof, until the cause for such
order has been eliminated; however, the Owner’s right to stop the Work shall
not give rise to a duty on the part of the Owner to exercise the right for
benefit of the Design Builder or other persons or entities.

 

9.5                                If the Design Builder defaults or neglects to
carry out the Work in accordance with the Contract Documents and fails within
fourteen (14) days 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 give a second written notice to the Design Builder
and, fourteen (14) days following receipt by the Design Builder of that second
written notice and 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 Design Builder, the
costs of correcting such deficiencies. If the payments then or thereafter due
the Design Builder are not sufficient to cover the amount of the deduction, the
Design Builder shall pay the difference to the Owner. Such action by the Owner
shall be subject to dispute resolution procedures as provided in Article 10.

 

ARTICLE 10
- DISPUTE RESOLUTION — MEDIATION AND ARBITRATION

 

10.1                         Claims, disputes or other matters in question
between the parties to this Agreement arising out of or relating to this
Agreement or breach thereof shall be subject to and decided by mediation or
arbitration. Such mediation or arbitration shall be conducted in accordance
with the Construction Industry Mediation or Arbitration Rules of the
American Arbitration Association currently in effect.

 

10.2                         In addition to and prior to arbitration, the
parties shall endeavor to settle disputes by mediation. Demand for mediation
shall be filed in writing with the other party to this Agreement and with the
American Arbitration Association. A demand for

 

23

 

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 on such claim, dispute or other matter in question
would be barred by the applicable statutes or repose or limitations.

 

10.3                         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
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 on such claim, dispute or other matter in question would be
barred by the applicable statutes of repose or limitations.

 

10.4                         An arbitration pursuant to this Article may be joined
with an arbitration involving common issues of law or fact between the Design
Builder and any person or entity with whom the Design Builder has a contractual
obligation to arbitrate disputes. No other arbitration arising out of or
relating to this Agreement shall include, by consolidation, joinder or in any
other matter, an additional person or entity not a party to this Agreement or
not a party to an agreement with the Design Builder, except by written consent
containing a specific reference to this Agreement signed by the Owner, the
Design Builder and any other person or entities sought to be joined. Consent to
arbitration involving an additional person or entity shall not constitute
consent to arbitration of any claim, dispute or other matter In question not
described in the written 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 the parties
to this Agreement shell be specifically enforceable in accordance with
applicable law in any court having jurisdiction thereof.

 

10.5                   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. Any and all
arbitration or mediation hearings shall be held in Sioux Falls, SD.

 

ARTICLE 11 - MISCELLANEOUS PROVISIONS

 

11.1.                Unless
otherwise provided, this Agreement shall be governed by the law of the place where
the Project is located.

 

24

 

11.2                   RELATED CONSTRUCTION OF SITE

 

11.2.1
Owner may perform other Work related to the Project at the Site by Owner’s own
forces, or let other direct contracts therefore or have other work performed by
utility owners. If the fact that such other work is to be performed was not
noted in the Conceptual Documents then (i) written notice thereof will be
given to Design Builder prior to starting any such other work and (U) Design
Builder may make a claim therefore as provided in Article 8 if Design
Builder believes that such performance will involve additional expense to
Design Builder or requires additional time and the parties are unable to agree
as to the amount or extent thereof.

 

11.2.2                          Design Builder shall afford each other
contractor who is a party to such a

 

direct
contract and each utility owner (and Owner, if Owner is performing the
additional work with Owner’s -employees) proper and safe access to the Site and
a reasonable opportunity for the introduction and storage of materials and
equipment and the execution of such other work and shall properly connect and
coordinate the Construction with theirs. Unless otherwise provided in the
Contract Documents, Design Builder shall do all cutting, fitting and patching
of the Work that may be required to make its several parts come together
properly and integrate with such other work. Design Builder shall not endanger
any work of others by cutting, excavating or otherwise altering their work
without the written consent of Owner and the others whose work will be
affected. The duties and responsibilities of Design Builder under this
paragraph are for the benefit of such utility owners and other contractors to
the extent that there are comparable provisions for the benefit of Design
Builder in said direct contracts between Owner and such utility owners and
other contractors.

 

11.2.3
If the proper execution or results of any part of Design Builder’s Work depends
upon work performed or services provided by others under this paragraph 11.2,
Design Builder shall inspect such other work and appropriate instruments of
service and promptly report to Owner in writing any delays, defects of
deficiencies in such other work or services that render it unavailable or
unsuitable for the proper execution and results of Design Builder’s Work. Design
Builder’s failure so to report will constitute an acceptance of such other work
as fit and proper for integration with Design Builder’s Work except for latent
or nonapparent defects and deficiencies in such other work.

 

11.2.4      Coordination

 

11.2.4.1   If Owner contracts with others for the
performance of other work on the Project at the Site, the following will be set
forth in Article 14:

 

25

 

a.      The individual or entity who will have authority and responsibility for coordination
of the activities among the various prime contractors will be identified;

 

b.      The specific matters to be
covered by such authority and responsibility will be itemized; and

 

c.      The extent of such
authority and responsibilities will be provided.

 

11.2.4.2   Unless otherwise provided in Article 14,
Owner shall have sole authority and responsibility in respect of such
coordination.

 

11.3        CLAIMS FOR DAMAGES

 

11.3.1      If either party to this Agreement suffers
injury or damage to person or property because of an act or omission of the
other party, of any of the other party’s employees or agents, or of others for
whose acts such party is legally liable, 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 first observance. The notice shall
provide sufficient detail to enable the other party to investigate the matter.
Ifs claim of additional cost or time related to this claim is to be asserted,
it               shall be filed in
writing.

 

11.4 INDEMNIFICATION

 

11.4.1      To the fullest extent permitted by law,
the Design Builder shall indemnify and hold harmless the Owner’s, the Board of
Managers, Officers, Owner’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
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, but only to the extent caused in whole or in part by negligent acts
or omissions of the Design Builder, anyone directly or indirectly employed by
the Design Builder or anyone for whose acts the Design Builder may be liable. 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 11.4.

 

11.4.2      To the fullest extent permitted by law,
the Owner shall indemnify and hold harmless the Design Builder, Broin’s Board
of Directors and Officers, Design Builder’s consultants, and agents and
employees of any of them from and against

 

26

 

claims,
damages, losses and expenses, 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, but only to
the extent caused in whole or in part by negligent acts or omissions of the
Owner, anyone directly or indirectly employed by the Owner or anyone for whose
acts the Owner may be liable. 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 11.4.

 

11.4.3      In claims against any person or entity
indemnified under this Paragraph 11.4 by an employee of the Design Builder,
anyone directly or indirectly employed by the Design Builder or anyone for
whose acts the Design Builder may be liable, the indemnification obligation
under this Paragraph 11.4 shall not be limited by a limitation on amount or
type of damages, compensation or benefits payable by or for the Design Builder
under worker’s compensation acts, disability benefit acts or other employee
benefit acts.

 

11.5                         SUCCESSORS AND ASSIGNS

 

11.5.1      The Owner and Design Builder,
respectively, bind themselves, their partners, successors, assigns and legal
representatives to the other party to this Agreement and to the partners,
successors and assigns of such other party with respect to all covenants of
this Agreement. Neither the Owner nor the Design Builder shall assign this
Agreement without the written consent of the other. The Owner may assign this
Agreement to any institutional lender providing construction financing, and the
Design Builder agrees to execute all consents reasonably required to facilitate
such an assignment. If either party makes such an assignment, that party shall
nevertheless remain legally responsible for all obligations under this
Agreement, unless otherwise agreed by the other party.

 

11.6                         EXTENT OF AGREEMENT

 

11.6.1      This Agreement represents the entire
agreement between the Owner and the Design Builder and supersedes prior
negotiations, representations or agreements, either written or oral. This
Agreement may be amended only by written instrument and signed by both the
Owner and the Design Builder.

 

27

 

ARTICLE 12
- TERMINATION OF THE AGREEMENT

 

12.1                         TERMINATION BY THE OWNER

 

12.1.1      This Agreement may be terminated by the
Owner upon 14 days’ written notice to the Design Builder in the event that the
Project is abandoned. If such termination occurs, the Owner shall pay the
Design Builder for Work completed and for proven loss sustained upon materials,
equipment, tools, and construction equipment machinery, including reasonable
profit and applicable damages.

 

12.1.2
If the Design Builder defaults or persistently fails or neglects to carry out
the Work in accordance with the Contract Documents or fails to perform the
provisions of this Agreement, the Owner may give written notice that the Owner
intends to terminate this Agreement. If the Design Builder fails to correct the
defaults, failure or neglect within fourteen (14) days after being given
notice, the Owner may then give a second written notice and, after an
additional fourteen (14) days the Owner may without prejudice to any other
remedy terminate the employment of the Design Builder and take possession of
the site and of all materials, equipment and finish the Work by whatever method
the Owner may deem expedient. If the unpaid balance of the Contract Sum exceeds
the expense of finishing the Work and all damages incurred by the Owner, such
excess shall be paid to the Design Builder, If the
expense of completing the Work and all damages incurred by the Owner exceeds
the unpaid balance, the Design Builder shall pay the difference to the Owner.
This obligation for payment shall survive termination of this Agreement.

 

12.2                         TERMINATION BY THE DESIGN/BUILDER

 

12.2.1
If the Owner fails to make payment when due, the Design Builder may give
written notice of the Design Builder’s intention to terminate this Agreement.
If the Design Builder fails to receive payment within fourteen (14) days after
receipt of such notice by the Owner, the Design Builder may give a second
written notice and, fourteen (14) days after receipt of such second written
-notice by the Owner, may terminate this Agreement and recover from the Owner
payment for Work executed and for proven losses sustained upon materials,
equipment, tools, and construction equipment and machinery, including
reasonable profit and applicable damages.

 

ARTICLE 13
- BASIS OF COMPENSATION

 

The Owner shall compensate
the Design Builder in accordance with Article 5, Payments, and the other
provisions of this Agreement as described below.

 

28

 

13.1                         COMPENSATION

 

13.1.1      For the-Design Builder’s performance of
the Work, as described in Paragraph 3.2 and including any other services listed
in Article 14 as part of Basic Services, the Owner shall pay the Design
Builder in current funds the Contract Sum as follows:

 

Four
Million Eight Hundred Fifty Nine Thousand Two Hundred Sixty Two Dollars and
Thirty cents ($4,859,262.30). This
price includes sales and excise tax and will remain valid as long as
construction is started by May, 2005. A Start date after that time will cause
the price to be reviewed and adjusted accordingly.

 

13.1.2      For Additional Services, as described in
Paragraph 3.3 and including any other services listed in Article 14 as
Additional Services, compensation shall be at a negotiated price.

 

13.2                         REIMBURSABLE EXPENSES

 

13.2.1      Reimbursable Expenses are in addition to
the compensation for Basic and Additional Services, and include actual
expenditures made by the Design Builder and the Design/Builder’s employees and
contractors in the interest of the Project.

 

13.2.2      FOR REIMBURSABLE EXPENSES, compensation
shall be a multiple of (1.1) times the amounts expended.

 

13.3                         INTEREST PAYMENTS

 

13.3.1      The rate of interest for past due payments
shall be as follows:

 

(1.5%)
one and one half percent per month.

 

ARTICLE 14
— OTHER CONDITIONS AND SERVICES

 

14.1                                The Basic Services to be performed shall be
commenced on issuance of Notice to Proceed and, subject to authorized adjustments
and to delays not caused by the Design Builder, Substantial Completion shall be
achieved in Eight (8) months following the start of concrete work. The
Basic Services beyond those described in Article 3 are as follows:

 

None

 

14.2                                Additional Services beyond those described in
Article 3 are as follows:

 

None

 

29

 

14.3                                The
Design Builder shall submit an Application for Payment on or about the 15th
day of each month. -

 

14.4                                The Design Builders Exhibits include the
following documents:

 

Exhibit 1 -           Scope
of Work consisting of two (2) pages.

Exhibit 2 -           Schedule of
Contract Values and Project Estimate consisting of one (1)

page.

Exhibit 3 -           Notice
to Proceed consisting of one (1) page

Exhibit 4 -           Confidentiality
and Nondisclosure Agreement consisting of seven (7)

Pages.

 

14.5  Other Conditions.

 

NO
OTHER CONDITIONS
ARE NEITHER EXPRESSED NOR IMPLIED OTHER  THAN THOSE STATED ABOVE.

 

IN WITNESS WHEREOF, OWNER
and DESIGN BUILDER have signed this Agreement in duplicate. One counterpart
each has been delivered to OWNER and DESIGN BUILDER. All portions of the
Contract Documents have been signed, initialed or identified by OWNER and
DESIGN BUILDER.

 

 

This Owner — Design Builder
Agreement will be effective on the day and year first written above.

 

30

 

	
  OWNER: GREAT PLAINS
  ETHANOL, LLC

  	
   

  	
  DESIGN
  BUILDER:

  	
   

  
	
   

  	
   

  	
  Broin
  and Associates, Inc.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  BY:

  	
  /s/ Darrin Ihnen

  	
   

  	
  BY:

  	
  /s/ Robert Broin

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:Darrin Ihnen

  	
   

  	
  Name:

  	
     Robert Broin

  	
   

  
	
  Title: Chairman

  	
   

  	
  Title:

  	
      CTO

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  [CORPORATE SEAL]

  	
   

  	
  [CORPORATE SEAL]

  
	
   

  	
   

  	
   

  	
   

  
	
  Attest:

  	
  /s/ Julie Carter

  	
   

  	
  Attest:

  	
  /s/ Rick Serie

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Address for giving notices:

  	
   

  	
  Address for giving notices:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Greet Plains Ethanol, LLC

  	
   

  	
  Broin and Associates, Inc.

  	
   

  
	
  27716 –462nd Avenue

  	
   

  	
  2209 East 57th Street North

  	
   

  
	
  Chancellor, SD 57015

  	
   

  	
  Sioux Falls, SD 57104

  	
   

  
																		

 

31

 

NOTICE TO PROCEED

 

Dated:         

 

TO:                           Broin
and Associates

 

ADDRESS:             2209 East
57th Street North

 

Sioux
Falls, SD 57104

 

Contract:                 Agreement
Between Owner and Design Builder

 

Project:                                                            To perform and furnish design, engineering,
and construction services for upgrades to existing ethanol processing plant.
The project is located at 27716 - 462nd Avenue, Chancellor, SD.

 

You are notified that the
Contract times under the above Contract will commence to run on                                     .
By that date, you are to start performing your obligations under the contract Documents. In accordance
with Article 14 of the Agreement the date of substantial Completion is 8
months following the start of concrete work.

 

Before you may start any Work, you must deliver to
the Owner (with copies to other identified additional insureds) certificates of
insurance which you are required to purchase and maintain in accordance with
the Contract Documents.

 

Also, before you may start any Work at the Site, you
must

 

	
   

  
	
   

  
	
   

  
	
   

  
	
   

  

 

	
   

  	
  Great Plains Ethanol, LLC

  	
   

  
	
   

  	
  (Owner)

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Darrin Ihnen

  	
   

  
	
   

  	
  (Authorized Signature)

  
	
   

  	
   

  
	
   

  	
  Chairman

  	
   

  
	
   

  	
  (Title)

  
						

 

32EXHIBIT 10.1

 

CONSENT OF SENIOR SECURED NOTE
HOLDER FOR EXTENSION OF MATURITY DATE OF SENIOR SECURED NOTE

 

Power Efficiency Corporation

3900 Paradise Road

Suite 283

Las Vegas, NV 89109

 

March 14, 2005

 

To: 15% Note Holders

 

Dear             :

 

                We
refer to the 15% promissory notes (the “Notes”) of Power Efficiency
Corporation, a Delaware corporation (the “Company”) due October 26, 2005 (the
“Original Maturity Date”).

 

                In
consideration of the Company’s agreement evidenced by this letter to continue
to pay interest on the Notes in accordance with their terms through the New
Maturity Date (as defined below), we understand that you are agreeable to
extending the Original Maturity Date to October 26, 2006 (the “New Maturity
Date”).

 

                Please
confirm your agreement to the extension of the Original Maturity Date to the
New Maturity Date by signing and dating a copy of this letter in the space
provided below and returning such copy to us. 
On receipt of your agreement, your Note(s) shall be amended to mature on
October 26, 2006, and to provide for the payment of interest quarterly on each
January 26, April 26, July 26 and October 26 through the New Maturity
Date.  The Notes shall remain in full
force and effect in accordance with their terms as so amended.

 

                Please
also affix a copy of this letter to the original Note or Notes held by you to
evidence their amendment.

 

	
   

  	
  Very truly yours,

   

   

   

  
	
   

  	
  Steven Strasser, Chairman
  & CEO 

  
	
   

  	
  POWER EFFICIENCY
  CORPORATION

  

 

 

The undersigned holder of Notes
hereby agrees to the amendment of such Notes to extend their maturity date to
October 26, 2006, on the terms and conditions set forth above:

 

	
   

  	
   

  
	
  Signature of Noteholder 

  Dated: March     , 2005

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00085-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00085-of-00352.parquet"}]]